John Travolta Takes to the Factory Floor - Essay Example

Educational Toy Company was formed to cover the gap of those educational toys in the market that would challenge the thinking of children. The company from the beginning only left a great impact on the customers. Now after a span of twenty years the company is in need of some change. Though ETC has a large production site in Melbourne and employs around 200 staff, it still needs to refresh. They need to create competitive advantage that is not just a function of how well a company plays by the existing rules of the game but it depends on the firms ability to radically change those rules as said by Vijay Govidarajan and Anil K. Gupta (2001) in their article "Strategic Innovation: A Conceptual Road Map. (Competitive advantage)". This strategy is the same for new comers like eBay or experienced firms like Ford Motor Company or General Electric. The details of the changes that need to be brought in would be discussed in detail as we move further. When we look at ETCs progress there are a number of issues, which need to be resolved. When we bring in any kind of a change within the organization, each change would have its own good and bad attributes attached to it. We need to look at all the issues with great concern and plan out the solutions accordingly. Aysar Philip Sussan and William C. Johnson (2003) say in their article "Strategic capabilities of business process: looking for competitive advantage" that the organizations need to become fast, flexible, participative and focused on customers, competition, teams, time and process. Lets proceed with the issues that exist and solutions that are available. Need to innovate There is currently a need of innovation within the company as the current sales have dropped and customers are looking for a fresher look within the product line. The Asian market has commended our product quality. Innovation as we know is a multi-faceted process that is going to incorporate creativity, invention and commercialization. Above all, innovation is a social process, where both individuals and systems are important dynamic elements. Hence we will have to think it seriously. Looking from the perspective of our Australian market, Simon Lloyd in his article "A game for the brave" (June 2004) states that Australians love innovation and in 2004 Grey Advertising/Sweeney Research Eye on Australia study found that the most admired companies were those which went for innovation and tried innovative products and brands. Ninety-three per cent of those surveyed were happy to try new brands and 78% were willing to pay more for something that is innovative and original. ACNielsen on the other hand estimates that 70% of new products and brands do not last more than two years, so it is not surprising that Australian companies often seem reluctant to experiment with innovation. Launches of new products in recent years in Australia have been rare because companies consider the investment needed for genuinely innovative brands and products is far outweighed by the risks. Our product can succeed after innovation only if they appeal at various levels. Findings confirm that innovative Australian Small and Medium Enterprises display strategic human resource management related practices such as career development, ongoing learning and development and strategic rewards. Sam Burd (2006) the President at Medical and Biotech Developments Inc. says that "the product redevelopment is the process of taking a critical look at a product that is not living up to its market potential and making the changes necessary to bring about success." When we talk of innovation we need to think of all the processes that would come under research and development and the capital that would be used to achieve all of it. But one should learn from the experience of others. P.M. Rao. (2005) states in his research named "Sustaining competitive advantage in a high-technology environment: a strategic marketing perspective" that how research and development plays role in companies, can be seen in the fortunes of U.S. companies and how the new economy are increasingly dependent on intangible capital, which comprises of two main components: intellectual capital and marketing capital. Intellectual capital includes research and development capability, human resources, and organizational practices. Marketing capital encompasses the reputation associated with brand name and other marketing assets. Both are essential to the new economy. The information and communication technology (ICT) sector, the power behind the new economy, epitomizes the growth and importance of intangible capital. It has been estimated that roughly one-third of the growth in gross domestic product (GDP) since 1995 has come from the ICT sector, although that sectors share of GDP is only 8 percent (Economic Report of the President, ERP, 2001). Staffing The next issue to consider is staffing. ETC does not have Human Resource professionals to look after the recruitment activities. It is costly to keep such professionals. Kris Miracle (2004) states in his "Case study: the city of Virginia Beachs innovative tool for workforce planning" that rapidly evolving technology, dramatically shifting workforce demographics, ever-increasing globalization, and a maturing workforce have combined to challenge human resource professionals of the 21st century. The administrative staff at ETC has been handling the payroll and personnel issues but there is really no one to look at the staffing issue. Payroll is not creating much of a problem currently therefore staffing issue needs to be seriously looked at. Solution ETC here needs to contact the recruiting agencies to overcome their staffing issue. The recruitment agencies would help them search for staff, which the company urgently requires. Recruitment Agencies need to be paid once and save time. The administrative staff need not to worry about staffing. The recruiting agencies have all the details of an applicant. We would just need to give them the details of job description and within a few days only our problem is resolved. Resistance to Change ETCs current staff profile mostly consists of older workers. These workers have a very good knowledge of existing work processes but are quite resistant to change. Solution Mark L Scott, Anna Whelan, John Dewdney and Anthony B Zwi (2004) report in their journal that the Australian Labor market is facing major skill shortages in the future due to brain drain factor and an increase in ageing and retiring population. Australias population is not growing at the rate required to maintain a healthy economic climate, and without policy change it will begin to decline in about 25 years and this is said to have negetive impact in the businesses states Business Asia (April 2002) in its article " The population debate - Recruitment - Australia faces problem of aging population ". ETC needs to compete with local and global competitors with a proper strategic plan. They need to effectively manage their present employees, conduct regular and adequate training and development programs, and uncompromisingly adapt new and efficient methods of attracting the high calibre of young people who are presently leaving our shores in droves to excel in overseas markets. The businesses may have to increase the retirement ages. Though ETC should bring in new young skills as Scott McLachlan Manpower Managing Director states in an article "Hiring Prospects On TheRise" (September 2006) that "The skills shortage is creating very real structural changes to the workforce already, meaning that companies must now be rethinking their strategies to ensure they can attract and keep the right talent," but ETC should also keep their older workers happy by means of making them attracted towards their job. With the above mentioned issues of innovation and staffing, we can see that change within the company is inevitable. Therefore we need to take steps to keep the current workers happy and bring in the change simultaneously. We need to implement a three-step change managing strategy that was initially proposed by a highly noted psychological researcher, Kurt Lewin. This strategy was stated in the journal article "Leading your firm through changes" by Richard A. Wiener (2005). Firstly, we need to "unfreeze" the existing behavior. We can do this by recognizing the need for change and setting goals and gain the companys commitment by showing a side-by-side comparison of the "old" ways of doing things with the "proposed ways" of doing things. Secondly, we must implement the "change". In this step, the company would roll out the new protocols and models of behavior, and the means by which the employees can learn the new procedures. Lastly we would "refreeze", the new attitudes and strategic vision and become entrenched with the company. There are certain recommendations to alleviate problems that arise due to older workers being resistant to change. J.W. Gilsdorf (1992) gives some tips in the form of recommendations in his article "The New Generation: Older Workers" to handle the older workers when it come to bringing in the change. Stay current: as skills would become outdated inevitably, the older workers would automatically adjust themselves to it. Older workers need to communicate with others in the workplace so that they are exposed to organizational values, plans, and trends as they evolve. Older workers who are from the beginning only made to stay current dont feel threatened when they are no longer considered the experts. Older workers who stay current enjoy much better work lives Be receptive to change. Change is normal, but it is upsetting for the older workers, it usually means some kind of loss to them. They find change threatening when the see younger workers charge of making decisions based on ideas that they dont understand or approve of. We know that change in the workplace is inevitable. Older workers should be made attuned to organizational goals. One more recommendation is to let older workers view their work as objectively as possible. If they can acknowledge flaws sooner, theyll discover solutions sooner, too. Build common ground. Older workers should avoid succumbing to generational clichés. They should continue the sports they enjoy, see new movies and plays, and be willing to give due credit to co-workers. Listen. In conversations, older workers should be made to actively listen to others and to themselves. Avoid reinforcing stereotypes. Older workers should try to counter stereotypes about them by setting examples. But they should do so courteously and not become fanatics. Get support. Older workers should use trusted friends and family members as sounding boards. Prevent burnout. Burnout is an illness. It is the final stage of a dysfunctional response to stress. Keep in mind that many of the above recommendations overlap. For example, older workers who dont stay current and who dont adapt to change are susceptible to burnout. Complains from our young employees The young employees at ETC also have some issues. According to them work is boring and routine. There is lack of empowerment. We know that young workers are an asset for us considering the increase in brain drain and decrease in population growth. We cannot lose them at any cost. H. Pillay, G. Boulton-Lewis, L. Wilss & S. Rhodes, Journal of Education and Work, v.16, n.4, 2003, pp.427-44. The authors conclude that because the new capitalism requires workers to keep abreast of changes in work practices, young workers need to be encouraged to participate in formal courses so they maintain and upgrade their skills continuously. Solution When a company wants to keep its employees happy and retain them for the success of the company, they have to take certain measures. Those measures are in the form of benefits and compensation. Some changes that can be brought in would be: Compressed workweek Compressed workweek is an arrangement of work hours that permits employees to fulfill their work obligation in fewer days than the typical five day workweek. Companies having such arrangements have been reported to have greater job satisfaction. Such a workweek offers a better use of leisure time for family life, personal business and recreation. Some employers have been reported to have increased productivity and reduced turn over and absenteeism. Flextime This is the practice of permitting employees to choose their own wqorking hours within certain limitations. Now what happens is that the employees would work the same number of hours per day as they normally would, but on a standard schedule. The employees would be permitted to work these hours within a bandwidth, which is the maximum length of work day. There would exist a core time where all the employees would be present and flexible time would be the period where the schedules of different employees would be allowed to vary. Empowerment Empowerment is the process of enabling or authorizing an individual to think, behave, take action, and control work and decision-making in autonomous ways. It is the state of feeling self-empowered to take control of ones own destiny. This system would make our employees more independent and would find their tasks more challenging when decision-making would be in their hands. They would leave them with lesser time to get bored. Empowerment could be also called as self-directed way of performing the job tasks. Simone Kauffeld (2006) in his article "Self-directed work groups and team competence" tells that British Psychological Society conducted a study to see if self-directed teams were more competent then traditional work groups. There were 83 production groups from 20 medium-sized enterprises: 44 self-directed work groups and 39 traditional work groups. The results showed that self-directed teams were more competent than traditional work groups on seven out of 12 aspects of competence. Self-directed teams showed greater methodological competence, as well as greater professional and self-competence as compared to the traditional work groups. Jasmine Tata and Sameer Prasad (2004) say in their article "Team self-management, organizational structure, and judgments of team effectiveness" that the use of self-managed teams has become a popular strategy for many organizations. Surveys indicate that 68% to 70% of Fortune 1000 companies are using teams. Job rotation Job rotation is the movement of our employees between different jobs. This system would also avoid our employee from getting bored as with job rotation they are doing different jobs all the time and learning new skills in other words applying knowledge of one task to others. Moreover, exposing employees to other types of jobs within the company promotes a better understanding of what others in the firm do and how each job contributes to the whole. Finally, a multi-skilled workforce can more readily adapt to changing markets. HRM Guide states in its article "Job Seekers Want Traditional Employer Characteristics" (September 2006) that 4,100 entry-level and experienced job seekers in 21 countries in the Asia-Pacific region, North and South America, and Europe were surveyed online to identify the career goals they valued most. They found that Challenging and interesting work was selected as a priority employer characteristic by 60 per cent of all respondents. Older workers have issues with young workers Older workers are quite dismissive of the younger workers, they think that young staff has a poor attitude to job quality. The company needs to alleviate the communication gap that develops as a result of the above-mentioned issue as well as the tendency of older workers to isolate themselves from younger workers; there is also a need to alleviate the entire negative stereotype that older workers are slow, inefficient and difficult to train. Solution Anne Hatton, President & CEO of Hudson Australia and New Zealand has said in one of the articles of HRM Guide "Employers Still Not Making Use Of Older Talent" that " Australias employment landscape is being shaped by the specter of an ageing workforce and an intensifying skills shortage". We know that both the older and younger workers are part of the company. We need to make them united and let them play as teams. Once they would be given the team incentives they would automatically adjust with one another and over come the existing issues. In many organizations, team or group working is now considered the norm so why not use the same strategy at ETC. We need to form team building, which is the process of motivating and enabling that group of people to reach their goal. Max Dorando and Josef Grun says in his article "Making teamworking work. (Managing Change in the Workplace)" that in many public and private sector organizations, team or group working is now considered the norm. Our group of people here at ETC would be a combination of old and young workers. We will have to take a few steps, which are illustrated below: To clarify the team goals To build ownership and commitment to those goals across the team To identify those issues which inhibit the team from reaching their goals To address those issues, remove the inhibitors and thereby enable the goals to be achieved After forming the teams we will have to give our employees the incentives to work in teams and achieve the goals. We will need to motivate them to work in unity. Lets see an example of Nucor, a high performing steel company, who divides its workers into work groups of around 25 to 30 people and pays work group members a bonus based on their groups production over a certain predetermined standard. If they produce 50 % above the standard they get 50 % bonus and if they produce 100 % above the standard they get a 100 % bonus. These work groups consist of employees of all the ages. During the past decade Nucors sales have grown by 850 percent and profits have grown by 1250 percent. Do we need expatriates or outsourcing? There is a need for a more electronic focus in the design of toys and for that young electronic technicians need to be recruited. There are some interested highly skilled and motivated technicians in Singapore who are willing to work in Australia. We know from different articles that the brain drain is increasing in Australia and the population growth is decreasing. After a few years we would be left with older workers and lesser of the young blood would be available. So now the question is to avail the opportunity of new blood that we can hire for the benefit of the company. Solution In order to derive solutions that whether to bring in the expatriates from Singapore or outsource our requirements, we will have to study the past events that have already occurred on the above-mentioned choices. We will have to see which method has succeeded in Australia before taking over the big step. Expatriates One of the interviews conducted in the book "Escape From America" (1996) tells us about a US based expatriate currently working in Australia. According to him it takes years to get to know a culture; approximate five to ten years. You can’t adapt in three weeks. He says it is the same opportunity today, or probably similar. The key is that the newcomers take time to establish themselves and understand the culture. This may inadvertently take some time for the expatriate to settle. There is usually a greater degree of possibilities in a smaller expanding economy than there is in a large slow moving economy. Natvisas (2006) reports in Expat Focus that Australias Department of Immigration and Multicultural Affairs has released figures indicating that foreign workers are arriving in the country at a rate of 158 per day. Expatriates get a better chance of investing in properties within Australia. Outsourcing Lets see what some of the companies have benefited after outsourcing and then decide upon bringing in the expatriates or to outsource. Asia Pulse News (February 2002) reports about Travel agency Harvey World Travel Ltd that it expects to benefit from increased call centre efficiency after outsourcing the division and moving it to Melbourne. Asia Pulse News (March 2002) reports that Vodafone Australia has outsourced its mobile handset distribution as part of an ongoing review of its business operations. Computer World IT Management (June 2005) reports about Carmaker Mitsubishi Motors Australia Ltd. that it has outsourced its enterprise server operations in a five-year, multimillion-dollar deal with IT services provider Vectra Corp. Baymont Inns & Suites will use InnLink Corp. to manage the Milwaukee-based brands reservation system. The contract with InnLink means Baymont will cease operations of its home reservation center in November and transfer them to InnLinks facilities in Nashville. Baymont decided to outsource reservations because of long lead time and huge technology costs associated with updating its current procedures. The garment industry in Australia outsources most of its work. A website on Call Centers (2006) reports that The National Australia Group (NAG) has awarded a five-year outsourcing contract to UK company beCogent to handle its Scottish call center. We have looked at some of the relevant pointers concerning hiring expatriates and outsourcing. But our findings show that most of the top Australian companies have been using outsourcing as their means of cutting down extra costs and helping them in time saving. We should know that when a successful company opts for any thing they do so after thorough research. These top companies have outsourced some of their operations. Their outsourcing of procedures gives us a good hint of doing the same. We should know that since these top companies have not brought in expatriates and outsourced their technical operations hence it means that outsourcing has some weight. Therefore ETC should also look into the idea of outsourcing their coming up of new products utilizing the technicalities and skills available in Singaporeans. Conclusion We know for sure that there exists no company, which may have no issues concerning their operations. All the successful companies have passed through this inevitable stage. This stage is not periodical; it may come and go depending on the changes in the political, social, economical and technological policies. It is the duty of the companies to study them and react accordingly. ETC has no doubt quite a few issues. But that does not mean that we have no solutions. We surely have solutions and means of applying and implementing those solutions. ETC needs to react immediately but move slow and steady. Reference List Websites 1. Interview with An American Expatriate in Australia (1996). Interview with An American Expatriate in Australia. Retrieved September 21st 2006, from http://www.escapeartist.com/australia/expat_interview.htm. 2. Expat Focus (2006). Australia: Foreign Workers Increased This Year. Retrieved September 21st 2006, from http://www.expatfocus.com/index.php?name=News&file=article&sid=609. 3. Asia Pulse News, B. B. (2002). Australias Harvey World Outsources Call Centre. Retrieved September 21st 2006, from http://www.findarticles.com/p/articles/mi_go1523/is_200202/ai_n6698893 4. Asia Pulse News. (2002). Vodafone Australia Outsouces Handset Distribution. Retrieved September 21st 2006, from http://calbears.findarticles.com/p/articles/mi_go1523/is_200203/ai_n6829325. 5. IDG. (2005). Global Dispatches. 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The population debate - Recruitment - Australia faces problem of aging population. Retrieved September 21st 2006, from http://findarticles.com/p/articles/mi_m0BJT/is_3_10/ai_85878912. 12. News Limited. (2006). Hiring prospects on the rise. Retrieved September 21st 2006, from http://www.news.com.au/business/story/0,23636,20396776-31037,00.html. 13. HRM Guide. (2006). Job Seekers Want Traditional Employer Characteristics. Retrieved September 21st 2006, from http://www.hrmguide.com/international/job-priorities.htm. 14. HRM Guide. (2006). Australians More Ambitious Than Most. Retrieved September 21st 2006, from http://www.hrmguide.net/australia/leader/ambitious-australians.htm. 15. HRM Guide. (2006). Employers Still Not Making Full Use Of Older Talent. Retrieved September 21st 2006, from http://www.hrmguide.net/australia/diversity/older-talent.htm. Journal Articles 1. Case study: the city of Virginia Beachs innovative tool for workforce planning. Kris Miracle. Public Personnel Management 33.4 (Winter 2004): p449(10).  2. Making teamworking work.(Managing Change in the Workplace). Max Dorando and Josef Grun. Management Decision v34.n5 (Sept 1996): pp24(2).  3. Self-directed work groups and team competence. Simone Kauffeld. Journal of Occupational and Organizational Psychology 79.1 (March 2006): p1(21). 4. Strategic capabilities of business process: looking for competitive advantage. Aysar Philip Sussan and William C. Johnson. Competitiveness Review 13.2 (Summer-Fall 2003): p46(7).  5. Sustaining competitive advantage in a high-technology environment: a strategic marketing perspective. P.M. Rao. Advances in Competitiveness Research 13.1 (Annual 2005): p33(15).  6. Team self-management, organizational structure, and judgments of team effectiveness. Jasmine Tata and Sameer Prasad. Journal of Managerial Issues 16.2 (Summer 2004): p248(20).  7. Leading your firm through changes. Richard A. Wiener.  New Jersey Law Journal (June 6, 2005): pNA.  8. Older and younger workers conceptions of work and learning at work: a challenge to emerging work practices.(Employment & training)(Brief Article). Sue Headley. Youth Studies Australia 23.2 (June 2004): p61(1).  9. Stabilizing the destabilized work force. Marilyn Moats Kennedy. Physician Executive v22.n6 (June 1996): pp40(2).  10. Strategic Innovation: A Conceptual Road Map.(competitive advantage). Vijay Govidarajan and Anil K. Gupta. Business Horizons 44.4 (July 2001): p3.  11. Teachers, technology and training: the UPS School-to-Career partnership: innovative approaches to workforce development.(United Parcel Service). Jim Donlevy. International Journal of Instructional Media 28.4 (Fall 2001): p329(4).  12. The new generation: older workers. (tips for training older workers). J.W. Gilsdorf. Training & Development v46.n3 (March 1992): pp77(3).  13. When Teams Work Best. Frank LaFasto and Carl Larson. Thousand Oaks, CA Sage Publications. 2001. 221 pages. 14. British Journal of Industrial Relations 43:1 March 2005 0007–1080 pp. 93–116 © Blackwell Publishing Ltd/London School of Economics 2005. Published by Blackwell Publishing Ltd, 9600 Garsington Road, Oxford OX4 2DQ, UK and 350 Main Street, Malden, MA 02148, USA. Peter Haynes and Peter Boxall are at the University of Auckland Business School. Jack Vowles is at the Department of Political Studies, University of Auckland. Explaining the Younger–Older Worker Union Density Gap: Evidence from New Zealand Peter Haynes, Jack Vowles and Peter Boxall 15. Accomodating Older Workers Needs For Flexible Work Options. Ivey Business Journal. July/August 2005. Read More