Understanding HRM Essay At Tesco And Sainsbury.

You are required to write a report that demonstrates academic understanding of some of the themes covered on the module and apply these to one or two organisations.

You are required to analyse one or two organisations covering some of following themes:

1. An analysis of HR policies and practices within the organisation(s) against selected theoretical concepts, e.g. high commitment HRM (HCHRM), best fit HRM or hard and soft HRM
   
   
2. An analysis of some specific external forces and the effect of these forces on HR strategic decisions within the organisation(s), e.g. the employment market in which your organisation operates, whether the work force is high skilled or low skilled, unionised or non-unionised
   
   
3. An analysis of how the HR function is organised and how HR policies and practices are delivered, e.g. do they follow Ulrich’s model or other forms of delivery; what is the role and the challenges of line managers in the delivery of HRM? (This may be easier to ascertain if you have worked in the organisation or have contacts that work in the organisation.) 

Stakeholder management at Tesco and Sainsbury

Key stakeholders

The key stakeholders for Tesco as well as Sainsbury include the Government. This is mainly because both the companies are public limited companies and are funded by the Government (Lawrence and Weber 2014). Apart from this, the employees and the customers form the other main stakeholders. The employees are the resources that help in the growth of the productivity of the companies.

The employees at Tesco enjoy a healthy relationship with the employers due to a proper communication system. The level of trust among the employees is high in Tesco. On the other hand, the communication system between employee and employer are not effective in Sainsbury. Hence, the employee involvement at the workplace is low. Most people tend to leave the company due to lack of motivation (Armstrong and Taylor 2014).

One of the major strengths of both the companies is the high level of skilled workers. This is one of the most contributing factors towards sustainable management. According to Sparrow, Brewster and Chung (2016), in order to employ skilled employees, it is necessary that the company have a good recruitment system. As evidenced by the type of employees, Tesco, as well as Sainsbury, follow a systematic and precise recruitment system.

Tesco and Sainsbury employ labours of all types. This includes part-time as well as full-time labours. The demography characteristic of the country allows for migrants from other countries to seek employment in retail organisations. This helps in improving the labour force of the country and creates a diverse work environment within the organisations.

The managers of Tesco and Sainsbury need to comply with the rules and regulations stated in the Employment Rights Act 1996. The act covers the basic payment of the employees and the interference of the trade unions (Storey 2014). Apart from this owing to diverse nature of employees, the managers need to keep in mind the ethical considerations that are set up as organisational policies.

Tesco and Sainsbury may be affected by the changes that occur in the trading policies. This is mainly because of the fact that both companies in trading activities with other countries (Budhwar and Debrah 2013). The negative political ties between the UK and other countries can decrease the rate of supply and demand of products. Apart from this, economic factors may bring down the rate of supply and demand of the products sold by the companies. Based on the five-force analysis of Porter one can say that Tesco and Sainsbury can be considered as rivals of one another. This is because of the same industry to which the companies belong. However, with the restrictions from the political field, the threat of new companies cannot be considered for the companies. Similarly, both companies have high threats from the buyers and sellers as the industry in which the companies operate are the same. Despite this due to proper managerial expertise and reputation, Tesco have an edge over Sainsbury in the retail market of UK. Thus, Tesco can be considered to have a better competitive advantage than Sainsbury (Budhwar and Debrah 2013).

Employee involvement and communication systems

Approaches to strategy

Tesco uses a more collaborative approach to strategy. This results in the high process of work along with the high input of employees. This is a more classical approach as the company have a rich tradition of high-quality supplies. On the other hand, Sainsbury uses the administrative approach, which focuses more on the high process that is used in the company.

According to Armstrong and Taylor (2014), hard and soft approach defines the manner in which resources are utilized in an organisation. In the case of both Tesco and Sainsbury, the companies apply a soft HRM approach in which the employees are considered as the most important resource and a source of competitive advantage.

Following HC HRM

Tesco and Sainsbury try to maintain a High Commitment Human Resource Management system (HC HRM). This signifies that the companies believe the employees to have a high potential towards the development and commitment of an organisation.

• Employment security and using internal labour markets

It is stated that relationship between employees and employers need to be of a give and take nature (Beardwell and Thompson 2014). Every company need to ensure the security of the job to the employees before expecting good quality returns. In the case of Tesco, such job security is provided to the employees unlike in Sainsbury. Sainsbury focuses more on profit-making.

• Selective hiring and sophisticated selection

Both Tesco, as well as Sainsbury, focuses on the selection and recruitment of employees that have a highly skilled level. The selection criteria of the employees are based on the qualifications of the employees and the experience they possess as per the job role available in the company.

• Extensive training, learning and development

Training is provided to the employees of Sainsbury in order to be more efficient in the line of work. Tesco selects the best individuals to work for the company and training is provided in order to help it to maintain their best services. Organisational learning needs to be provided based on the job role that is delegated to the employees.

• Employee involvement, participation and worker's voice

According to Reiche et al. (2016), employee involvement in Tesco is different from that of Sainsbury. In Tesco, the employees are involved in the strategic decision-making of the company due to a good communications system with the superiors. On the other hand, Sainsbury does not allow employees to be involved in top-level activities of the company.  

• Self-managed teams/team-working

Teamwork helps in maintaining efficiency in the workplace. Better decisions can be taken that involve achieving the organisational objectives. Tesco, as well as Sainsbury, believe in teamwork and self-managed teams. The leaders motivate the team members and provide an excessive solution to the employees in the case of problems. This is one way of motivating the employees and ensuring the productivity of the organisation is maintained (Aswell 2013).

• Higher than average pay and performance related pay

Recruitment and selection strategies

Tesco believes in providing higher than the average pay to the employees. The rate of paying salary in Tesco is higher than the average rate of paying the employees in the market. On the other hand, Sainsbury uses provide high pa based on the performance of the employees. Employees can receive incentives if the target provided to them is fulfilled.

The HR practices of Tesco and Sainsbury have many similarities as well as dissimilarity. However, the efficiency at which these strategies are implemented is different as compared to the Top 100 companies that are identified by the Sunday Times (Appointments.thesundaytimes.co.uk 2017). The list includes all type of companies that are located all over London. This suggests that Tesco and Sainsbury need to improve more on the application of HRM strategies.

Some of the promoting factors of HC HRM for Tesco include the motivation of the employees and the control of the employees. This helps Tesco to maintain the HC HRM practice effectively in the company. In the case of Sainsbury, the organisational culture is the main factor that promotes the working of HC HRM in the organisation.

As established earlier, Tesco adopts motivation of employees while Sainsbury adopts the organisational culture for promoting HC HRM. The life cycle of the organisations is at the maturity stage as both companies have a high rate of revenue. According to Purce (2014), Tesco believes in cost reduction and innovation of products and services. On the other hand, Sainsbury adopts the quality enhancement in order to be competitive in the market. One of the most important areas in management is the motivation of the employees. By utilising Maslow’s motivation theory and Herzberg’s theory Tesco and Sainsbury can identify the needs of the employees. Maslow’s hierarchical theory states that employees need to be motivated based on the needs of the employees that start from minimum and moves up the order. Herzberg’s theory opines that the factors that affect the performance of the employees need to be divided into hygiene factors and motivation factors. Tesco utilises these techniques in order to motivate the employees and ensure that employees can be retained in the organisation.

Level of HRM department functioning

The HRM level of both the organisations is at the maturity level, as both Tesco and Sainsbury believe in increasing the revenue of the companies. The presence of the HR at the director level is high in Tesco as the involvement of employees and employers in organisational decisions prevail in the company. However, such involvement is absent in the case of Sainsbury. With the application of the maturity model of Kearns, both companies can identify the manner in which the company have evolved. It can be seen that Tesco have evolved through the stages owing to its reputation in the market. The scale represents the transition from personal administration to personal management. In this case, Tesco is more matured than Sainsbury as the companies have different of opinions in terms of handling expenses and motivating employees. The HRM activity is also shown to be superior in Tesco as the strategies formed by the company is directed more towards satisfying customers with quality. This leads to the development of Human Capital Management that is utilised in order to maintain the resources of the organisation.

Motivation theories at Tesco and Sainsbury

The future strategic focus of Tesco involves maintaining strategic partner and change agents. This involves people and procedures that are essential for the growth of the company (Tesco.com 2017). On the other hand, Sainsbury outsources HR activities to other departments of an organisation and consults external agencies in regard to any business strategies outside the UK (Sainsburys.co.uk 2017).

The role of line managers is to recruit talented employees in order to fill up the vacant positions. They need to provide training to the employees so that they can provide effective services to the organisation. In the case of failure of meeting targets, it is necessary that the line managers take corrective actions (Veloso, Tzafrir and Enosh 2015).

The contributions made by the HR are measured by the profit earned by Sainsbury. The numbers of sales that are conducted by the company over the years are analysed to determine the contributions of HR. On the other hand, the motivation of employees and the manner in which loyalty of the employees are maintained are analysed by Tesco.

Lack of identifying organisational goals

The managers of Tesco and Sainsbury are nor reluctant to take decisions that may be risky for the company. The lower level employees can approach the managers of both companies and proper solutions regarding any complaints are provided. The managers are not threatened by empowerment from internal or external sources.

According to Jackson, Schuler and Jiang (2014), the excessive workload is one of the de-motivating factors for employees. In the case of Tesco and Sainsbury, the companies ensure that every employee is rewarded for the work done. The basic focus is to reduce the amount of work and provide proper time for balancing work and family life.

Investment in training requires organisations to lose a day of production. Tesco and Sainsbury provide training for the betterment of the employees and the organisation. However, investment is made less in training as the managers make the changes in the organisations frequently (Michael 2017). However, the investment of Tesco in training is more than the investment made by Sainsbury.

It is necessary for every manager to develop rules for the company in order to impose control over the employees. Managers of Tesco and Sainsbury need to adapt to the rules but at the same time remain flexible in the case of changes that are applied in the organisations. These rules are based on the rules and regulations that are provided by the Government.

HRM level and maturity model

It is seen that the employees due to various reasons break the organisational rules (Budhwar and Debrah 2013). This reason can be either accidental or due to the fact that employees remain unaware of the rules. It is the duty of the managers of the companies to implement the rules and ensure it is followed effectively.

It can be recommended that Sainsbury need to perform the performance appraisal system frequently in order to ensure that the employees are motivated and the skills are enhanced. On the other hand, Tesco needs to reduce the investment that they make for training the employees so that the company can restore its financial stability. The recommendations can also come in the form of motivating employees. Both companies need to identify the ways by which employees can be motivated and the make provisions for ensuring such kind of motivation is provided to the employees. Tesco and Sainsbury are reputed organisations that need employees as resources to succeed. Hence, such motivation factors can help the companies to maintain its reputation in the business.

Conclusion

Thus, it can be concluded in order to attain success in the business market, Tesco and Sainsbury need to ensure that the best practise related to HRM is carried out. The managers keeping in mind the interests of the stakeholders of the company direct the manners in which these practises need to be carried out. The mode of motivation provide to the employees need to be improved so that the companies can identify retain employees and ensure that proper working in the organisations take place. Thus, Tesco and Sainsbury are two companies that need the adoption of the relevant theories to ensure competitive advantage in the market.

References

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