Introduction
Most companies today especially those playing in the global market have undergone a lot of changes basically to address the issues and problems confronting the company and some for strategic reasons. Whether due to problems faced by the company or as part of the company’s strategy to remain competitive and improve sales, or both of these reasons, organizational development and changes are necessary. These changes may include change in the company’s objective, change in strategy, location, operational techniques or organizational structure.
A company’s organization comprises of individuals, teams and management who are all behind the company’s success or failure. Each individual or team in an organization has different tasks which must be performed effectively in line with the goals and objectives of the company. A company undergoing organizational changes in order to solve problems and improved the company’s present situation needed to use strategies in human resource management, making each individual and team within the company perform their tasks efficiently. Strategic HRM requires good leadership that can effectively motivate, communicate and lead the company to its success. However, most problems in businesses are people problems; that is why strategic HRM is important in every organization.
This paper discusses about the issues in strategic HRM by evaluating and analyzing the case study of HRD and Change at FumeGo Ltd. By analyzing a company’s situation and identifying its problems, the paper has come up to possible solutions backed up by some theories on strategic HRM. The paper includes discussion of organizational development, techniques that can possibly identify and solve problems, and the importance of organizational change as strategy of HRM.
Company Overview
FumeGo Ltd. is a company which manufactures customized cupboards for the laboratories of pharmaceutical companies and universities. The company manufactures the cupboards according to the specification and needs of the customer. Currently, the company is divided into several department departments such as the sales, design, manufacturing and support function departments which includes the payroll, accounting, FIRM, and the administration. The manufacturing department is further divided into different team or section depending on its function or task, which include the plumbing section, electrical section, sheet metal cutting and folding, protective coating application section, and the assembly section. All in all the company employs about 220 individuals of whom 175 belong to the manufacturing department. Although most people in other departments such as those who perform supervisory, sales and design roles seems satisfied with their jobs, there are higher turnover in the manufacturing department.
During the recent years, the company has been experiencing sales decline, lower financial returns, and a noticeable decline on the number of repeat orders from its past clients due mainly to poor quality and delivery performance as well as failure to meet the customers’ needs. To address these issues, the company hired a new Managing Director, MD. With the initiatives and strategies that will be formulated by its new MD, the company hopes for improvement of the company’s organization, gaining new orders and winning back past customers. In other words, the company relies on the efficiency and leadership of its new MD.
In order to identify the company’s problems, the new MD conducted a thorough investigation on the company’s current activities and reviewed the company’s past performances. He found out several problems in the manufacturing and the design departments. First, the manufacturing departments allowed delivery of products with some defects for the sake of meeting delivery dates which led to customer complaints and modification of the products. This wrong process involves additional costs in the part of FumeGo. Another problem found out by the new MD is that the production process of FumeGo lacks efficiency and that the standards used by the company is not enough to be able produce high quality customized products. Aside from these, lack of concern for the company and for the customers, and laziness are evident to the workers in the manufacturing process because of the untidy workplace. In the design departments, there are also some problems which cost a lot to the company such as unnecessary additional features of the products and the department does not involve manufacturing with its design process.
Problems/Issues Identification
From the case study, different problems can be identified. The primary problem is lack of adequate skills and knowledge for the employees, not only with the specified departments in the case study like the manufacturing and the design departments, as well as with other departments since, as an organization, different departments are linked directly or indirectly with each other, causing chain reactions which means that a problem with one department may cause problems with the other departments.
In the individual level, the problem is that they lack of skillful leaders that will guide and motivate them especially in the manufacturing process. A good leader in the manufacturing department should be well knowledgeable in producing high quality products. High quality products yield to more sales and profits which is the primary reason why the business exists. A good leader is also a good motivator, encouraging his subordinates to perform efficiently with concern to both the company and the customers. Also, the manufacturing department must be involved in the design process in order for the design and manufacturing to be aligned with each other. The design department should regularly check if the products are manufactured according to the design and specifications, while the manufacturing department must inform the design department of the processes that are involved, if there are some specifications that may be altered or can not be done.
Furthermore, the individuals comprising the design departments lack the ability to integrate cost-effectiveness while maintaining the quality of the products. These individuals must be focused on how to integrate customers’ specifications while meeting their needs. Also, individuals involve in the design of the products must conduct further research on how to improve the quality of the products they design especially today that most manufacturing companies are driven by technology, making more improved and advanced designs that satisfy customers.
In the organizational level, company seems to lack of established mission and objectives that must be formulated by its leaders. The company is seemed to be focus on gaining profit without the realization of how it can gain more profit. The company is focus only on production but not on the quality, on customer satisfaction and improving company performance. The entire company needs good leadership and management that have enough knowledge, skills, and experiences in strategic management, customer relations and human resource management. The company has no goals of satisfying employees, in return, its employees have no concern over the company and its customers, and high labor turnover happened. Another problem is the reason behind the company’s sales decline which is poor responsiveness to customers’ needs. The company’s employees are not oriented in satisfying customer care and satisfying customers’ needs, thus the company is losing loyal customers and having hard times gaining new customers.
Behind all these problems, HR management seems to have failure in identifying the problems in the company. The company became aware that problems exist only after a period of sales decline and when the financial return of the company becomes unsatisfying.
Credit:ivythesis.typepad.com
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