1. Explain the importance of effective HR strategies in term of creating competitive advantage and for companies operating in the global marketplace.
2. Indentification of the strategic HR issues relevant to the overall performance of the organisation.
3. Recommended chages to overcome the problems facing the company, using evidence from reading to support these points sand underpinning arguments with theoretical explanations and models.
1. The importance of effective HR strategies in terms of creating competitive advantage and for companies operating in the global market
The Human resource management is essentially a part of the management process that make, enhances, manages and develops on the human aspects of the organization in terms of the talents, skills, creativity, knowledge and the potentials that contribute to the organization objectives (Armstrong and Taylor, 2014). The human resource is an important source for the competitive advantage for an organization. To tape on the effectiveness of the human resource there is need to follow the standard policies that can promote on the promises and foster on the inclination of the employees to act flexible to the interest of the organization and the need to achieve the set goals and objectives. In any business the four Ps compels how to differentiate on the company goods, services, and those of the competitors (Bamberger, Biron and Meshoulam, 2014). Moreover, as one plans to get the business off the ground there is a need to consider more than the marketing strategies in order to be able to achieve the competitive advantage no matter the market the firm is situated (Boella and Goss-Turner, 2013). One of the most aspect of the business is what is regarded as the HR strategy and the human capital that entails the team in the organization and the employees themselves (Banfield and Kay, 2012). There is need to look at the important of an effective HR strategy to create the competitive advantage. The company aimed for this research is Nestle.
Background information of Nestle Company
The Nestle Company is a multinational packaged food organization that was founded and its headquarters is in Vevey, Switzerland. The trade mark of the company ks a bird in the nest, which was derived from Henri Nestle personal coat of the arms. The company has global renowned on their brand and this has made the company to be the global leader in different product lines. The company is one of the most known FMCG Company (Boxall and Purcell, 2011). To every part off the world, the name of the Nestle represents a commitment or the promise to the customers that the product that their products are of high standards and they are safe for the consumption. The company has supported the United Nations Global Compact. The UNGC they act on the guiding principles that of the human rights, aims and the labor to offer. An example of this is better labor practices and the human rights in all of the activities of the business (Bratton and Gold, 2012). The aspect of the Human resource to an organization it can provide it with a competitive advantage over the competitors especially in a fast changing environment. In order to achieve this there is need to have a strategic management plan for the human resource to accomplish on the corporate objectives of the company (Buller and McEvoy, 2012). There is need to have strategic goals in order to be able to enhance and develop on the organization culture, performance and be able to foster on the innovation, flexibility and a competitive advantage.
HR strategies for Nestle Company
The strategic management for the human resource helps in the creation of the competitive advantage for the organization over the company rivalry by building on a unique human resource based competence (Campbell, Coff and Kryscynski, 2012). Various aspect like recruitment of the organization, selection, training and the performance management processes, and the compensation can influence on the competency of the employees (Chang, 2016). The workforce in the organization should be capable if they have identified, and selected on the right individuals to work. The appraisal aspect in the organization takes place based on the performance of the workers and the focus to improving them in the future through counseling, and training.
The human resource strategy of the business should thus be able to reflect and support on the strategy of the corporate (Chan and Marchington, 2013). An effective human resource strategy entails how the organization develops on the employees and how they provide them with the opportunities, and better working conditions thus they can perform optimally. The company aims to increase on the business, the number of the customers, profits and the sales. Moreover, there is need to improve on the standard of living of the employees and provision of high quality of products for everyone (Chen, Tang, Jin, Li and Paillé, 2015). The company is convinced that the employees act as the strength of the organization and it is impossible to achieve anything without their participation and commitment, which makes them to be a significant asset. For the worker to show their involvement and their interest to all the levels it should start with the basic information in the activities of the company and how to meet them (Delahaye, 2015).
Importance of the human capital
If an organization can effectively and efficiently be able to manage on the human capital through Leverage to achieve the business objectives they can achieve success in the marketplace. Nonetheless, the failure to undertake these aspects through planning and implementation can lead to the reduced productivity and profits (Dundon and Wilkinson, 2014).
In most cases many of the entrepreneur overlook on the aspect of the human resource planning especially at the early stages of the business. Some think that the human resource starts when the firm grows large to have the department of the human resource. The truth of the matter is that HR strategies should always start when the firm is at the creation. It does not matter where there is a formal plan for the human resource at the start up stages in order to handle the entrepreneurial education, the aspect of compensation and the working hours (Gatewood, Feild and Barrick, 2015). The HR strategies should set the stage on how to handle on these issues when one decide on when to hire the employees. Additionally, it also provides on the guidelines when one is acquiring on the business services in order to fulfil on the different functions of the business that you do not adequate time to fulfil or even perhaps to subcontract (Grant, 2016). It is vital to approach on this decision strategically from the start-up of the business. Moreover, not all that have the expertise in HR at this stage of creation.
Effective HR strategies in creation competitive advantage
There are different ways in which human resource can help in order to enhance on the competitive advantage especially for the companies that operate on the global market like our case Nestle Company. The company can achieve this through offering of the low price on the market. This can be achieved through ensuring that their operating expenses are very low in order to optimize on the profit made (Hendry, 2012). Moreover, this can be accomplished by deriving on the human capital from the pool of the contractors who are independent in order to minimize on the HR expenses and combining with other methods of reducing of the expenses to achieve profits. This company can use the offshore vendors to leverage on this strategy and they can achieve huge profits (Jiang, Lepak, Han, Hong, Kim and Winkler, 2012). Another effective strategy to employ on the HR is to use different perspectives that can be able to yield on the lucrative ideas and how to differentiate on the products and the services of the company. These ideas may come from the employees, equity partners can be the source of the innovations (Kehoe and Wright, 2013). The company can have a good internal culture for nurturing on the innovation of the employees by allowing the workers sometime in the course of the week to work on the projects that they are interested in, even though the company will not apply them immediately. Another way to achieve effective HR strategies to enhance competitive advantage is to allow the most skilled employees to offer the product that can charge a high premium. Such can be the product and the services that are regarded as luxury in the company (Mathis, Jackson, Valentine and Meglich, 2016). In most of the cases, it may cost a lot of money especially in the recruitment, training and retaining some high skilled employees who will add value in the organization, this cost should be passed to the consumer in form of the premium pricing on the goods. Another way to have effective HR strategies is to build on the teams in the organization. When the organization is hiring ensure that those employees who are hired should be aligned on the strategy and the tactics of the business (Need, 2006). The organization should not just hire because they can do that, each of the new worker who will be employed should be able to accomplish on some of the aspects of the organization strategic plans. Moreover, there is need to formalize on the planning of the human resource. Nestle company may have been reluctant on the formalizing the plans of the HR, they can achieve this through hiring of the necessitates at the beginning of the long-term planning of the human resource (Nyberg, Moliterno, Hale and Lepak, D.P., 2014). Additionally, to achieve on an effective strategy is to pay attention to the culture of the firm. A combination of the cultures of all the employees, businesses, and the equity partners to create something unique in the business. If the relationship of these individuals is not cultivated, well it will create a negative impact on the entire operation of the business (Park and Shaw, 2013). The culture in the business should be cultivated well and relationship established in order to enable the employees to perform well and optimally on the objective of the business.
2. Examine on the strategic HR of the organization to identify the issues affecting the overall performance of the organization.
The human resource management function has faced many battles to justify on the position of the organization. At the good times when the firm has enough budget, they can easily justify on the expenditure in regards to training, staffing, and the reward of the employee as a way to motivate them. It is thus important to examine on the strategic plan of the human resource of Nestle Company and identify on the issues that affects on the overall performance of the organization (Ployhart, Nyberg, Reilly and Maltarich, 2014). The research of the study is Nestle Company the strategic plan will focus on the recruitment process carried in the company and the problems issues that have affected the performance of the organization. The recruitment entails the process of developing and maintaining on the adequate work force of the resources. The recruitment attempts to get the interest of the applicants and create a pool of the prospective employees in order for the management select the right individual for the right job. The process of recruitment in Nestle Company is essentially clearly defined. The company matches the candidates with the value and the culture employed in the organization. The recruitment process takes place at the head office and all at the other branch level. Employees who have existing are promoted to the higher post as its one of the requirements (Snell, Morris and Bohlander, 2015). The company does not offer lateral recruitments and they sometime recruit at the campus through a placement program and the human resource consultancies. Various issues have affected on the performance of this organization and these aspect are the following; one of them is there are ineffective HR measurement that are in place (Stahl, Björkman and Morris, 2012). Improvement of the performance of the employees cannot happen without the right tools to measure on the HR effectiveness. There is need to measure on the transaction management of the profession as well as the terms of the positive influence on the business. There is need to utilize on the metrics that determines on the effectiveness of the HR role in the administrative functions (Stone, 2013). Another aspect that may affect the employee performance is when there is stagnant grow in the organization. Another factor that affects on the performance of the employees is the aspect of organizational and the job factors. These factors outside the control of the employee may affect the employee on their ability to meet on the expectations of the business (Storey, 2014). Such factors may include but not limited to poor leadership in the organization, inadequate tools or the support of the employer, cumbersome processes of work and the lack of rewards for an effective performance may affect the performance of the employees. When the cause of the performance problem related to the organizational and the control the employee control should be the responsibility of the employer to correct the problem or bring the issue to the next department especially the Human resource that is concerned in recruiting of better leaders in the business (Stredwick, 2013). Another issue found to cause low performance of the employee is low motivation. Motivating of the employees to complete on their job duties at satisfactory levels can be quire challenging. The members of the staff show motivation when they are self-inspired to undertake on the various tasks and when they are proud of their job. In Nestle Company, it has been found that some of the employees do not have the drive to succeed at the company and this has adversely affected on the productivity and performance of the company (Tyson, 2014). On the strategy employed by the company, do not have an appropriate motivational scheme to motivate the employees to love their job. When there is dissatisfaction in the work environment, it would likely lead to no motivation of the workers. Moreover, it has been shown that the employees who are not motivated are likely perform at a level that is lower than the other staff. In the case where there no excitement for the mission of the organization it could be very difficult to maintain the momentum, which is needed to complete on a given project (Tyson, 2014). The aspect of the low productivity is usually a consequence of not being motivated, and the other workers usually feel that they should work hard in order to compensate for the tasks that are unfinished. The company should highlighted down on the companies goals and the objectives of the employees in order for them to see the significant of their positions in the company. The strategic HRM has been focused on the theories and practices of the in the organization, and consequently on the follow up on the use of the HRM measurement system. The overall performance of the organization is essential towards making the entity to have competitive advantage (Tyson, 2014). Models can be used to explore on the issues affecting the overall performance on the organization and how this organization can apply to reduce on these challenges. The model to use is the resource-based approach. The model looks at the internal resources of the organization, which are the principal factors for the sustainable of the competitive advantage. The main core of the approach is the human resource in which flexibility be applied in order to reduce the cost and increase on the efficiency (Ulrich, 2013). In the problem of lack of motivation of the employee was highlighted as a means of the low productivity in the workplace. The model can be used integrated in the strategy of human resource management to foster for the change on the commitment of the employees.
Another factor affecting on the performance of the employee is the non-existence brand of the employer in this company. For many of the companies, the brand of the company fulfils many multiple functions (Ward and Peppard, 2016). The brand usually help the company to be able to differentiate on their products, they help to create a brand loyalty for the company, and it helps to provide a platform for the new products. The employer branding is usually a targeted, and a long-term strategy used for the management of awareness and perceptions of the employees. The use of this strategy could be used to drive on the recruitment, the retention, and the productivity of the management efforts (Youndt, Snell, Dean and Lepak, 1996). Nonetheless, if there was non-existence of the brand to the employer there would be likely low performance of the employees. The aspect of the employer branding is the expression on the corporate culture and the brand. If these is not clearly defined there would be effects on the consumer performance in that they do not know what they relates or be associated with in the organization. The employee are influenced on the relevance of the brand and if there in non-existence of the brand by the employer, the employee cultural aspect would not be addressed. Lastly, another issue that has affected on the performance of the employee in Nestle Company is the low productivity. In any business a high workers productivity is usually regarded as the heartbeat of the success of the business. When the employee become distracted and they are unhappy, their work become affected ultimately this trend affect the company. Moreover, if the workers experiences problems, they do not perform to their full potential (Banfield and Kay, 2012). It has been found some employees in the Nestle Company the reason why their productivity is low become they are affected by problems such as financial stress. This may entail the problems of the money concerns that affects them on their life (Boxall and Purcell, 2011). There is need for the organization to teach the workers how to manage their money or how to prepare for the financial security hence will help improve on their quality of work and this will help increase the overall productivity of the organization.
3. Recommendations devise and justification of changes to the HRM strategies of Nestle Company
Strategic Human resource management provide a direction for building of the foundation for the strategic advantage by the creation of an effective organizational structure and the design, workers value proposition, culture and a communication strategy that is effective (Bratton and Gold, 2012). The strategic HRM usually emphasizes on the organizational code of ethics, the management of the decision for the business and the role of the human resource professional towards the improvement of a quality of life of the employees, and the society. Performance in regards to the context of an organization, has been used in the synonymously with aspects of productivity, the efficiency, and of recent in competitiveness of which has been the subject of the study for the social scientist (Buller and McEvoy, 2012). An example, the labor productivity has been the concern of the labor economist like Marx and Smith. Within this framework, one of the Marx’s fundamental insight on how to extract labor from the labor power is regarded as the basic problem of management. In recent efforts there have been made by the HRM theorist to establish the HRM and the performance of the employees (Chang, 2016). There have been a growing number of studies that examine on the potential contribution that a good human resource strategy policy can help to improve on the performance of an organization. The human resource theory helps to achieve two outcomes; more efficient and effective job performance and the increase employee motivation. One of the theory that the organization could adapt is the Henri Fayol theory, which argue that the workers usually perform more efficiently when the management is more efficient. Four functions can be adapted from this theory; these are planning, leading, controlling and organizing. The human resource management could adapt these functions to monitor effectively on the performance of the employees (Delahaye, 2015). Another theory Nestle Company could adapt is Maslow theory developed by Abraham Maslow on the motivation of the employees. In accordance to Maslow, the human beings usually have the needs, which are organized into hierarchy. The theory has provided a personal focus on the reason as to why people should work. This individual argued that people were satisfied from an ascending series o needs from the survival, through security until eventually self-actualization. There are certain needs that should be met at every level and any employee who fears for their job cannot focus on the high performance of the job in the work place (Grant, 2016). The organization should aim at providing all the needs an individual needs in order for them to performance effectively on their jobs. This can be achieved through better pay, recognition if they do something good, and the need to make them feel what they are doing is fulfilling.
There are certain changes of HRM strategies of Nestle Company can undertake to improve on the productivity and the performance of the individuals and ultimately the overall performance of the company improves (Hendry, 2012). One of the changes is the increase of the productivity through the in-house skill training and outsourcing. Training is usually a human resource management tool that is used in the development of the skills and knowledge to the employee who ultimately improve on the performance of the organization in terms of the efficiency, effectiveness and productivity (Need, 2006). On the member of staff growth, the theorists have argued that this is merely an additional management tool, yet the investment created is generally for the long-term performance of the individuals as well as the organization, that could be linked with the organization aims for the near future (Park and Shaw, 2013). This administration tool is consequently accustomed to improve both the expertise and the capabilities that the individual need to shift along the organization also to have the capacity to undertake an occupation, which is in the distinct the requirements that are evolving on every company element (Storey, 2014). The training as well as the development of the workers may also be vital for the business if it plans to achieve the competitive advantage by means of the highly qualified employees who are versatile thus providing quality performance and high productivity levels. The human resource management commitment to the training and the development of the employees in the attempt to improve on their quality of the product and the delivery of the service shows importance in that it sends the signals to the workers that they are highly valued in the company (Stredwick, 2013). This may raise on the morale of these employees and encourage them on the commitment to the company. Moreover, the training these employees get would enable them to effectively do their jobs much better and provide them with more responsibilities and creativity on their work; hence more job satisfaction on their part (Tyson, 2014).
The company should also be aimed at motivating of the employees. Various ways may be put in place to motivate the employee; these can be through bonuses, promotions, team building retreats and salary increments (Ulrich, 2013). A workforce that is motivated may cut the cost of the supervisions, as they possess the drive and the while to effectively perform on their objectives. The use of the motivators reward the employees for not only doing their jobs, but also doing the job with all enthusiasm. The motivators are also aimed at retaining the normal levels or the morale of the employees (Ward and Peppard, 2016). The important part to the improvement of the employee motivation and the performance should be clear and attainable goals. Employees highlighting on the goals they have for the organization helps to improve focus and cohesion of the team. HR strategies should incorporate more awareness programs to aid the employees for far better understanding of the policies for the business (Kehoe and Wright, 2013). Much more incentives ought to be presented to the employees who may have provided solutions to the business for longer than two years consistently.
The human resource of Nestle organization to be able to enhance on the productivity of the business they could offer soft Human resource policies. The job satisfaction, the dedication of the workers and the motivation are thought to be essential dimensions of the Human resource techniques when it comes to the performance of the organization (Mathis, Jackson, Valentine and Meglich, 2016). In accordance enthusiasts of the soft model on the concern of HRM debate, employee should always be treated as important assets, a source of the competitive advantage by way of aspects of commitment, their versatility as well as the excellent of the skills they have (Need, 2006). The workers usually are proactive but rather passive inputs into the productive processes. These people are equipped for the advancement of the worth of the trust and collaboration. The management should shift from the managerial strategy on imposing of the control to elicit commitment (Delahaye, 2015). Human resource management should be content on just securing of the employees compliance through the conception of the labor contract but they should aim at winning the hearts of the employees by designing on a broad design of the job, and by encouraging flexibility and involvement of the employees on the affairs of the organization.
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