Describe about the Human Resource Management for Appropriate Implementing.
This particular case study has provided an in-depth analysis on the importance of implementing appropriate recruitment policy for running a business organization successfully. From case scenario, it has been observed that Hong Kong Furniture Company has successfully occupied a predominant place in the realm of furniture industry all over Hong Kong. YK Chan the CEO of this company does not believe in maintaining any stereotyped recruitment policy at the workplace. Therefore, this particular individual intended to involve family persons within the business organization. However, after expanding the business process from Hong Kong to Melbourne, YK Chan has decided to hand over the responsibility of Melbourne office to Patrick as this person is well acquainted with the market structure and demand of Australia.
However, after the business expansion, this particular company has faced innumerable difficulties for maintaining organizational image and reputation due to two distinguished cultures and market strategy of Hong Kong. This particular study has focused to deal with necessary plans and policies of Hong Kong Furniture that should be implemented at the workplace of organization for running the business process successfully. SWOT analysis has been conducted for evaluating the strength, weakness, opportunities and threats of Hong Kong Furniture after business expansion in Melbourne. The different aspects of selection criteria for holding the position of manager have also been discussed in this specific study.
With the help of SWOT analysis, the organization has evaluated the strength, weakness, opportunities and threats of Hong Kong Furniture that can have a major influence on the business organization for expanding the entire wings in various geographical boundaries. However, the necessary strength, weakness, opportunities and threats of Hong Kong Furniture include:
Ø Varieties of product designs in affordable price range
Ø Effective unity among the employees
Ø The organization does not care to maintain proper hierarchy at the workplace
Ø Cultural conflict of Hong Kong and Melbourne
Ø The organization fails to maintain proper employee selection process at the workplace
Ø Lack of professional training of the employees
Ø To expand the entire process of business in different geographical boundaries
Ø To provide effective training process for enhancing the communication skill of the employees
Ø Competitors market strategy is one of the major threats in the current market for maintaining furniture business in the realm of Australia
Ø Threat of continuous growth of substitute market in the current business industry
Table 1: SWOT Analysis
(Source: Arnold and Boggs 2015)
Hong Kong Furniture is able to provide various designing furniture in affordable price range. As a result, people from various geographical boundaries can draw their attention for using the products and services of this particular organization. Moreover, the business employer likes to take collective decision before forming any business strategy and policy for fulfilling customers’ needs and demands (Becker, Kugeler and Rosemann 2013). The CEO prefers to appoint family businesspersons within the organization for holding high position. As a result, the business strategy can be kept confidential for becoming a threat in current market.
Cultural conflict is one of the major weaknesses of Hong Kong Furniture. As per Hong Kong market strategy, the organization has to implement low cost strategy for drawing the attention of large number of customers. As per Australian culture and consumer behavior tendency, the customer focuses on brand value. Most of the customers can be categorized under premium cost (Davenport 2013). As a result, product quality is highly important based on which Hong Kong Furniture would be able to create a market demand for a long time. In addition, the product designing method of Hong Kong Furniture is not suitable for Australian consumers. In this kind of situation, the organization has faced innumerable challenges for establishing their business process in the market of Australia.
The organization is possessed with major opportunity for expanding their entire business process beyond going the Australian market (Davis and Tama?Sweet 2012). The business experts can expand their business process in the market New Zealand as well. In addition, the organization like Hong Kong Furniture should provide an effective training process to the employees in order to enhance their professional skills and competencies. As a result, the customers’ service process of Hong Kong Furniture would automatically be increased.
While enhancing the entire business process of Hong Kong Furniture, the entrance of European Furniture Company has rendered a major threat. The business experts of European Furniture Company have formed business strategy and policy as per the current needs and demands of Australian market. In this kind of situation, Hong Kong furniture had to face innumerable difficulties for drawing the attention of Australian customers. In addition, the emergence of substitute market such as plastic, rot iron has also become a major threat for Hong Kong Furniture.
List of selection criteria for the position of a manager in Melbourne office
Effective communication skill:
As per the Hong Kong organizational culture, the employees and the managers have the lack of proper communication skill based on which they fail to make effective conversation with each other (Golmohammadi and Mellat-Parast 2012). Customers as well showed their level of dissatisfaction while communicating with the employees effectively. However, the inhabitants of Australia are endowed with strong communication skill. Therefore, while selecting an employee for the post of manager, the organization needs to focus on the communication skill of that individual. An effective communication skill reflects on the personality of an individual so that the person can maintain an effective interaction with the employees.
Strong Decision making skill:
While selecting a person for the post of manager the human resource managers should focus on the decision-making skill of the person. In order to run an organization successfully, the business managers should have an effective decision making skill based on which the individual would be able to handle any kind of organizational crisis (Govindan et al. 2015). If the business organization faces any challenges, the managers have to play a major responsibility with the help of which organizational strategy and policy can be changed. Therefore, decision-making skill is one of the most important aspects that a manager should have for keeping a constant a control the entire process of business.
Competency to handle sudden crisis:
Manager should have the capability to control the any kind of sudden crisis that a business organization has to face (Yu, Zhang and Xu 2013). When the business process of Hong Kong furniture faced a major downfall due to the entrance of European Furniture Company in Australian market, the organization was lacking an efficient manager to handle the crisis. Hong Kong Furniture should select that individual in the post of manager who has the capability to handle any kind of sudden crisis at the workplace.
To understand the psychology of Australian consumers and form the business strategy in accordingly:
Before forming business strategy and policy, the manager should understand the needs and demands of Australian consumers (Jeston and Nelis 2014). The products should be designed in such a way that Australian consumers tend to show their interest for purchasing products and services of Hong Kong Furniture. The manager should have the skill to make appropriate business strategy and policy for the organization. Based on the business organizational strategy the success of business is highly dependent (Stone 2013). Therefore, Hong Kong Furniture should select the person for the position of manager who is possessed with the capability of forming effective business strategy and policy to reach organizational goal.
The suggestions for YK prior to the Australian expansion of Hong Kong Furniture:
As mentioned by Al-Sarayrah et al. (2016) for successful cross-culture management, the executives need to identify the cultural variables of that society. Hence, before expanding to the Australian market, YK needed to make a business culture research on that market. It would help the organization to understand the culture and value of the countrymen. Moreover, depending on the labor policy of Australia and the business culture report, a well-written and structured HR policy was needed to be formulated. On the other hand, as discussed by Vaiman and Brewster (2015) in the context of cross-culture management, the organization needs to appoint the local staffs in the management positions. Moreover, YK needed to understand, for managing the staffs with different culture, the company needed to frame structured communication policy, clear hierarchical order and unambiguous code of conduct, so that people face no issues in maintaining a positive organizational culture.
The suggestions for YK after the failure of Hong Kong Furniture in Australian market:
As a HR manager, I would suggest that YK needs to create a board for decision-making at least for the Australian office. Moreover, the employees need to be integrated in the decision-making process at least via representatives. The Australian society advocates democracy in the organizational set-up. Hence, YK needs to introduce an open communication channel for the employees so that they become able to raise their concerns. Moreover, the company needs to introduce a structured and clear HR policy for eliminating all kind of confusion and contradiction in employee management. As opined by Den Hartog and Boon (2013) the companies need to formulate a clear set of criteria for employee’s professional growth, unambiguous and equal code of conduct and structured staffing and training procedure for successfully managing the human resources and addressing employee conflicts. Moreover, the company needs to change its value from being a profit-making company to an employee-centric and pro-environmental and flexible organization, to be successful in the external and internal context in a sustainable basis.
The internal and external environmental factors that have affected Hong Kong Furniture:
The socio-political scenario of Australia and Hong Kong is significantly different. It has also influenced the internal organizational factors of Hong Kong Furniture.
The potentiality of a business is largely dependent on the cultural preference of demography of a society. The product design that was popular in the Hong Kong market failed to attain desired popularity in the Australian market. As discussed by Warner (2014) the Australian customers are largely influenced by the European fashion, whereas the rest of the Asian markets are more conservative and prefer to stick to their traditional choices. Hence, by declining the requirement of changing the product design, Hong Kong Furniture failed to acquire customer popularity.
As per the global regulations, the protected rainforests and its resources are prohibited to be used in any commercial purpose without any legal permit (WWF.com 2016). The company collected its raw materials from rain forests which was a clear violation of the environmental laws. This led the company to hart their brand image and customers cancelled the contracts.
As per the Australian labor laws, the employer are prohibited to make a dismissal without a prior notice and providing appropriate reason for it (Fairwork.gov.au 2016). Here, the employees are entitled to obtain compensation for unfair dismissal. In the Australian office, the management failed to comply with this legal boundary, which created a huge media buzz against the organization. Moreover, it created dissatisfaction among the employees. The incident of the unfair dismissal of an employee made the company face legal trials and financial compensations. Moreover, it created mistrust and lack of commitment among the existing staffs.
The Australian economy is strong enough that offers a tight labor market (Lo and Budde-Sung 2013). There is more job opportunity than the supply of labor. Hence, the labor compensation is higher in Australia than in Hong Kong. The company faced increased cost for employees which hart the financial base of the organization.
Use of technology is highly influential in the market success of a company. Australian market is more technologically advanced than its Hong Kong counterpart (Warner 2014). Hence, the customers are more likely to choose the products those are technologically updated. However, Hong Kong Furniture had the opportunity of changing the product design in Australia. However, the company did not meet it and failed in attracting the market demand.
Cultural conflict and organizational culture:
As mentioned by Warner (2014) the culture of Australia is individualistic, which advocates the democratic decision-making pattern in the organizational aspect. According to the Australian culture, the staffs are equal individuals and there is no need of showing personal obedience. However, the management of Hong Kong Furniture concentrated on the need of showcasing obedience to the leaders. It directed towards a cultural conflict as the power gap among the employees is low in Australia than Hong Kong.
On the other hand, as discussed by Miller et al. (2014) the leadership pattern is largely influential in shaping the organizational culture. Hong Kong Furniture was maintaining an autocratic leadership as it was successful in the Hong Kong office. However, it was a complete failure in the democratic and professional work culture of Australia. Patrick and YK failed to identify it and the organization faced lack of employee morale. Moreover, the lack of trust of Patrick on the employees of Australia branch, created an environment of mistrust and disregard between the management and the employees. It decreased the productivity and potential of market success in Australia.
As mentioned by Miller and Gordon (2014) in the organizational setup, maintaining a clear and well-structured communication pattern is critical. Moreover, while opting for cross-cultural management, knowledge of a common official language is vital for eliminating ambiguousness in direction and information flow. The gap of the language in the two branches increased operational cost time for delivering a job. Moreover, the lack of a clear code of conduct and the pattern of top-down communication created employee dissatisfaction and conflict between the employees and the management.
As the Australian labor market was tight, Patrick had to hire employees with lower educational background and experience. As mentioned by Meijerink et al. (2016) employee competency is crucial for successful market performance of a company. Here, lack of competency of the employees in attaining a substantial level of sales can be identified as a cause of the market failure of the organization. Moreover, the lack of competency of the Hong Kong employees in communicating in English increased the operational cost of the company.
Hence, from the above-discussed case study, it can be concluded that the company was successfully operating in the Hong Kong market as its organizational culture was significantly conforming to the societal values. However, the same culture which was strength proved to become a failure in the different cultural set-up of Australia. Moreover, the lack of structured HRM policy made the situation more complicated as there were no structured procedures to address the conflicts or maintaining the employee relation. The Hong Kong Furniture needed to focus on its human resource management procedure by keeping the cultural difference in focus. Moreover, while opting for expanding in a different economy, the management needed to be more flexible in the decision-making processes. Depending on the environmental variables the management needed to introduce necessary changes within the organizational set up. With a structured and unbiased HRM policy and strategic management approach the company would be successful in the new market.
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