Strategic Human Resource Management is an approach to the practice of human resources that addresses business challenges and makes a direct contribution to long-term objects. It is termed as practice of attracting, developing, rewarding and retaining employees for the benefit of both employees and organisation. This report is based on two organisations one is The Entertainer founded by Donna Benton in the year 2001. It is situated in Dubai and performs functions with team of 180 employees. Build-A-Bear Workshop is another organisation situated in Missouri, US and works in toys from 1997 (Bailey and et.al., 2018). In this report information regarding HR policies and practices in the organisation, external factors force that effect HR decision is mentioned. Together with this method used to deliver human resource policies and practices are mentioned.
1. Analysis of HR policies and practices within the organisation
The Entertainer and Build-A-Bear Workshop both works in toy industry. The Entertainer is smaller than Build-A-Bear Workshop as it only employees approx. 200 employees and another one employee 6000 employees. Human resource of both the organisations helps them to achieve set objectives. Policies of the organisations must be effective in order to have productive results. Practices and policies of the human resource in Build-A-Bear Workshop are focused on improving contribute twards organisational performance. This HR polices of firm are mainly used to increase labour turnover, reduce absenteeism, improve employee’s behaviour and attitude, improve quality and consumer service (Armstrong and Taylor, 2014). There are set of HR practices which can increase the productivity and organisational performance.
However, High Commitment HRM focuses on extensive training, learning and development where training and learning makes employees of the organisation more productive and capable to perform multiple activities. Build-A-Bear Workshop is dealing in toys sector and possess emphasis more on quality and consumer services after sales. Providing training to the employees helps organisation to turn the workforce as best and highly productive. Training gives competitive advantage to the company as employees are ready to take challenges in the day-to-day activities. Training helps to boost morale of the employees and set them for new challenges and turn it as opportunity. Different training programs should be designed for staff members and trained on the basis of skills that is already existed in them. As Build-A-Bear Workshop directly deals with its consumers so staff members must have communication that is important to communicate with consumers (Taylor, Doherty and McGraw, 2015).
Team working: It is defined as a fundamental component of organisation success. When employees in the organisation performs various activities in a team then it will lead to better decision making and achievement of more creative solutions. Spirit of a team is always high then individual to achieve set goals. It is seen then over the last decade team working is provided with more and more importance. Team working in Build-A-Bear Workshop is termed as pooling ideas and improving work process in response to competition. While performing in a team strengths and weakness of individuals are identifies and turned in best productive manner for the organisation.
High compensation contingent on performance: There are two elements in the practice one is higher then average compensation and other one is performance related rewards. As per this practice employees in the organisation must be awarded for their superior contributions. Motivation is termed as key of productive results and it comes from rewards. Employees in Build-A-Bear Workshop needs to be rewarded for their performance and hand work. This will make them more enthusiastic towards work. Awarding employees for their good performance helps to retain and attract qualified workforce in the organisation.
Practice that is followed by HRM of The Entertainer is Hard and Soft HRM practice that is defined as follows-
There are variety of ways to approach the management of HR in a business. There are two broad approaches to HRM termed as hard and soft HRM. These two approached are totally different from each other. As hard HRM treats employees as a resource of the business-like other resources such as machines and buildings. Resources have huge contribution in business planning regarding what resources are required and how (Hollenbeck and Jamieson, 2015). In this HRM retention of employees in the organisation is for short duration. Minimum communication takes place from top to bottom.
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Soft HRM treats employees as the most important resource in business and a source of competitive advantage. Each employee is treated as individual and their needs are planned accordingly. Organisation focuses on roles, rewards, motivation of the employees. Soft HRM must be followed by The Entertainer as retention of employees for long term is important for success of the organisation (Storey, 2014).
2. External forces and effect of these forces on HR strategic decisions
External factors influence a business that leads a business towards success or failure. Both the organisations are working in toy sector and external factors are affecting operations of the organisation. These external factors include stakeholders who are individuals that affects or get affected by the organisation's actions, policies and objectives. Some of the key stakeholders of The Entertainer and Build-A-Bear Workshop are creditors, employees and government. As both of the organisations are operating in toy industry where the HR may have to face various type of issues while formulating strategies. In this sector low skilled employees are required who can be hired by the HR whenever the organisation requires. (Collings, Wood and Szamosi, 2018). All such types of employees are the part of unionised labour where there is a leader who controls the union and all the members follow the instructions of that leader. These are the forces that highly effects the HR decisions. All the effects are described below:
- Low level of trust: In both the organisations low skilled workforce is required that are the low level workers. HR of the companies have to face issues because there is lack of trust as it is not possible for HR to trust all the employees. Workers also don't trust the management as they are unionised they follow the instruction of their leader. It also results in strikes that are done by the employees in order to show their aggression against management. The HR have to change the judgements that are made earlier due to demands of the workforce.
- Repetitive work: When employees have to perform same activities daily then it is considered as repetitive work. In manufacturing companies like The Entertainer and Build A Beer the workers have to repeat their work daily which results in decreased interest of them in their jobs. It is very difficult for the HR to deal with this problem because it is not possible for the manger to change their job profile due to lack of activities there. It affects the HR while formulating strategic decisions as the main responsibility of the manager is to enhance work quality of the employees.
- Lack of employee involvement: When employees are not much involved in the work it means they are not taking interest in the job. It is a huge issue for the Human resource manager because it will affect the organisation's performance as well as the market image (Brewster, Mayrhofer and Morley, 2016). It affects the decision making process of HR because new strategies are required to motivate employees to work hard and put higher efforts to complete all the tasks related to their jobs.
- Government or legal factors- Policies that are designed by government for business affects the HR decisions because the changes are required to be made according to those regulations. Policies designed by law must be followed by both the organisations to have smooth business operations and reduce government intervention. HRM of the organisation helps businesses to cope up with the changes in legal system. Effect of BREXIT on Build-A-Bear Workshop was more in comparison to The Entertainer as it operates in more countries. It has resulted in higher salary related issues of employees because company has started to reduce their salaries and terminate them. It has affected the HR decisions because the HR have to deal with all the workforce related problems.
3. Analysis of organisational function organised and policies are practised and delivered
Ulrich Model is meant specifically to organise human resource functions. It suggested that in large-scale businesses and giant organisations, HR functions should be compartmentalized into four segments such as strategic partner, change agent, administration expert, employee champion. As HR is responsible for keeping employees happy, hard working to an organisation that helps to achieve long term objectives. Build-A-Bear Workshop is large organisation and follows this model to practice and deliver organisational functions. This model is not suitable for The Entertainer as its operations are not scattered and giant and other source is used to practice and deliver HRM policies and strategies (Albrecht and et.al., 2015).
To deliver HR policies and practices shared service is used by Build-A-Bear Workshop through which activities are available to number of parties. This model reduces cost and avoid duplication of efforts and allows a greater focus on HR strategy. On the other hand business partner model is used by The Entertainer which is responsible for aligning business objectives with employees and management. This helps to serve as a consultant to management on human resource and related issues.
Role of line managers in the delivery of HRM
Line manager is a person who directly manages other employees and operations of a business while reporting to a higher-ranking manager. Line manager can be considered as direct manager. Role of Line manager in both the organisation is to helps in recruitment and hiring new talents. Provide training and support to new hires, ensures cross training and job rotation. Communicating departmental goals and monitoring individual and team performance. Ensuring quality standards for all processes and reviewing team performance. Role of line manager are not different in both the organisations (Strategic HRM,2019).
Challenges of line managers in the delivery of HRM
Challenges differs of both the organisations as Build-A-Bear Workshop is large organisation and demands long hours on job that The Entertainer do not required. Responsibility for overall operations will be more in Build-A-Bear Workshop organisation.
- Lack of identification with management: The line manager of both the organisations have to face this challenge because there is no identification with management
- Lack of knowledge and skills:
- Insufficient training:
From the above report it is concluded that human resource is considered as one of the most important resource that contribute towards success of the company. Strategic human resource management helps to manage resources effectively in the organisation. Human resource policies and practices should be analysed as per implication of model in order to achieve goals and objective of the organisation. External factors must be studied well to minimise the its impact on strategic decision taken by the organisations.. Line manager in the organisation have critical role to manage HR of both the companies.
- Albrecht, S. L. and et.al., 2015. Employee engagement, human resource management practices and competitive advantage: An integrated approach. Journal of Organizational Effectiveness: People and Performance. 2(1). pp.7-35.
- Armstrong, M. and Taylor, S., 2014.Armstrong's handbook of human resource management practice. Kogan Page Publishers.
- Bailey, C. and et.al., 2018.Strategic human resource management. Oxford University Press.
- Brewster, C., Mayrhofer, W. and Morley, M. eds., 2016.New challenges for European resource management. Springer.
- Collings, D. G., Wood, G. T. and Szamosi, L. T., 2018. Human resource management: A critical approach. InHuman Resource Management(pp. 1-23). Routledge.
- Hollenbeck, J. R. and Jamieson, B.B., 2015. Human capital, social capital, and social network analysis: Implications for strategic human resource management.Academy of management perspectives. 29(3). pp.370-385.