Understanding The Use Of Human Resource Management Policy For Competitive Advantage - Primark Case Study

1. Explain and justify how effective HRM policy and process can help organisations deliver strategic effect, by contributing to competitive advantage. Use at least one evidenced example of an organisation that has achieved this in the last 15 years, with clear analysis of how their HRM practice has contributed to organisational success.

2. Provide three evidenced examples of how Internal (Organisational) or External Environment factors have affected the delivery of HRM policy and practice within the United Kingdom in the last 25 years. Clearly demonstrate how HRM practice has been affected along with any legislation that is relevant to the issue.

Background on Primark

Understanding the Use of Human Resource Management Policy for Competitive Advantage

Human resource management is the manner by which human resources, namely employees working for a business enterprise are organized and managed in order for them to be able to work in collaborative fashion with peers and supervisors to attain the goals and objectives of that business enterprise. Human resource management therefore forms a crucial component of the strategic management policy of just about any organization. This essay looks at the case of Primark in the UK, with the aim of understanding how the company has used its human resource management policy in order to attain strategic growth via competitive advantage. For this purpose, the assignment provides a brief background regarding the company and its work and then proceeds to analyze the human resource practices that are followed by the organization in detail.

Primark is one of the largest clothing companies in the United Kingdom and it came into existence in the year of 1969 in a place called Mary Dublin Street. It initially operated under the aegis of PENNEY’s and opened as many as four more branches in the exact same location in the very first year of its operations. The first store was officially opened in the Irish city of Cork in the year of 1971, and this was followed by the opening of at least twelve more stores in the northern part of Ireland over the next few years (Cook 2018). It was in 1973 that Primark expanded its operations to the country of Great Britain, with the very first multiple acquisition taking place in 1984, with five of the Woolworths stores being purchased in Ireland. In the decade between 1984 and 1994, Primark was able to open as many as twenty five new stores all across the United Kingdom as well as in Ireland. In the year of 1992, a BHS store was also bought as well as added to the Primark chain. It was in 1995 that Primark expanded considerably in the UK, in a manner by which it was able to achieve prominence. It was in this year that Primark opened sixteen more new stores in the United Kingdom with most of the stores being based in the capital city of London, and being of significant sizes (Moon et al. 2018).

Primark’s first all European venture took place in 2006 in the month of May, when the company opened one of its branches in Spain. Yet another store was opened in Murica in the same year and in the year of 2007, the company opened a few more stores in both Spain as well as Xanadu. Primark established its presence in the country of the Netherlands in 2008, by setting up a store in the city of Rotterdam and in the year of 2009, several more stores were opened in countries such as Germany, Portugal as well as Belgium. Today, there are as many as 196 stores operating in Europe and the United Kingdom, making it one of the most significant and well known retail businesses in the region (Thompson and Maclarney 2017).

HR Policy of Primark

The human resource management policy that is followed by Primark is one that is fairly decent. For instance, employees are provided with a handbook about the company’s HR policies at the time of joining so that they do not remain in the dark about the approaches taken by the company to keep its employees satisfied and well protected. Employees get to know first hand exactly what they can hope to expect from the company management when it comes to things like taking and applying for leave, receiving incentives and appraisals, working beyond shift timings among others (Dach and Allmendinger 2014). The HRM policy is therefore one that is quite transparent and open, allowing employees to have full knowledge of what it is they can hope to expect and never expect from the company management.
Care is taken by the HR of the Primark company to pay its employees an additional sum of money if they work beyond their shift timings. Employees who are found to be working for long hours into the night or who are seen to be taking night shifts on a regular basis, are given some additional payment as a reward for the extra effort that they are putting in for the company’s benefit. It is important to note that while this sum of money is not much at all, it is a gesture that is greatly appreciated on the part of the company officials, who like being acknowledged for all the surplus work that they do for the company, even if it means staying back into the late hours of the night to get a job done (Dach and Allmendinger 2014).

The shift timings that are followed by the Primark Company could definitely be more flexible than what they are at the moment, but no employee is forced to work at one particular shift timing continuously. For instance, employees who are working the morning shift, will get the scope after a few months have passed to work the night shifts as well. It is not that they will always have to report to work in the morning hours, and the same applies for those who work the night shifts at Primark. Employees are made to alternate between the night shift and the day shift and in this way the company makes sure that no segment of the employee population feels discriminated against (Mitra 2018).

While the pay that is on offer at the Primark Company tends to be lower than the rate that is currently being offered for the same job positions in the UK, efforts are made on the part of the company’s HR department to make sure that both men as well as women working for the company get an equal pay. There is no discrepancy in pay in this respect as men and women are equally rewarded for their labor and for their efforts (Ryding et al. 2015).

How HR Policy Helps Primark Attain Strategic Growth

The Primark Company is known to offer excellent appraisals to all of its employees in the form of gift cards. The gift cards are usually valued at between 20 and 30 pounds, and it is a gift card that can be used only when shopping at one of the Primark outlets. The Primark Company thus manages to do good business and keep its employees happy at the same time. Employees do not have to feel out of place at all when they render service for the Primark Company (Arriaga et al. 2017).

The recruitment methods that are followed by the Primark Company are fair and equal in every sense of the term. Employees are selected on the basis of their talent and their merit and not for any reason that may be deemed as unfair. Only the most worthy and gifted of candidates are called for an interview and those who manage to answer the interview questions successfully are taken into the company’s employee base immediately. Efforts are also made by the Primark Company to recruit all types of people into the company’s employee population, with members of the third gender and disabled people also being given a chance to work for the company (Woods 2017).

Primark as a company thus follows an HR policy which enables the company to aim for strategic growth via competitive advantage. Employees feel happy and satisfied working for this company because they are rewarded for their efforts, they are given regular incentives and appraisals, their salary is one that is at par between both male and female workers and the leave policy is also fairly decent. Employees therefore feel the motivation that is needed on their part to work in a spirit of collaboration in order to achieve the business goals and objectives of the company (Henninger et al. 2017). They feel the urge to take on rival companies by doing their best for Primark, working long hours as and when needed as they know full well that their needs and requirements will be taken care of. Also, the fact that Primark recruits all types and categories of people into its employee set up makes the people at the company all the more secure and happy. They know that they work in a fair and just environment where people from diverse backgrounds are given the scope of doing good work for the Primark Company and that too for the long term (Rashid and Barnes 2017).

External Factors That Affect HRM Policy in the UK

Thus, there is no doubt that the decent, rewarding and flexible HR policy that is followed by the Primark Company is one that has definitely made it possible for the company to keep its employees happy and which has also gone a long way in getting such employees to work well enough and hard enough for the company to be able to take on its business rivals successfully. Competition is something that the Primark Company is able to fight and face easily because of its loyal and trusted employees who always feel motivated to do their maximum for company growth and benefit.

Part 2 – Understanding How External Factors have Affected HRM Policy in the United Kingdom in the Last 25 Years

The Human Resource Management policy in the United Kingdom in the last twenty five years has undergone a significant change, largely due to political, economic and social developments in addition to technological and legal developments.

Political – The United Kingdom has witnessed a good deal of turbulence due to the Brexit movement, a movement that has been opposed by the labor party with all its might but which managed to fall through anyway because of the support the right wing party got in seeing it through. The announcement of Brexit resulted in the shocking resignation of British Prime Minister David Cameron and his party, followed by the takeover by Theresa May and the Tories. Brexit had been resisted by the migrant population in the UK for a good number of years and continues to be opposed by them, given that this is a phenomenon that allows Britain to come out of the European Union and focus efforts more on local business and the local economies rather than on globalization. In a way it implies that Britain has shut its doors to any type of collaboration on the trade and commerce front, with other European countries, making life quite precarious for the foreign business ventures operating in the UK as well as the lives of so many migrant populations who were depending on global economic collaboration in order to thrive and prosper in the UK, The rigid political environment that prevails in the UK post Brexit makes it difficult for companies like Primark among others, to follow an HR policy that is global and progressive in its nature and scope. It is now not possible to recruit migrants to top positions in a company or for performing specific jobs as easily as it had been in the past, with the emphasis now being on hiring more local and consequently more white people for jobs instead, regardless of whether this is good or bad for business (Collings et al. 2018).

Economic – Economically, the United Kingdom has seen a number of downs in the years between 2007 and 2011. This in turn has affected the purchasing power of the people, who are not able to spend as easily as they were able to before. In this period of economic downturn however, companies like Primark have been favored by consumers because of the fact that Primark clothes and garments are so affordably priced. Where other companies have had to let go of employees in large numbers because of the economic downturn, Primark has been able to recruit a considerable number of people to work at its stores both in the United Kingdom as well as outside of it, largely because of the huge demand that there is in the UK and Europe for garments manufactured by Primark. The Primark garments and outfits are priced quite affordably and cater to customers of all budgets. As a result, the company has not only been able to do good business in the period of economic downturn, but it has also managed to hire people to various positions at its stores and outlets, generating employment, retaining employees and doing good business all at the same time (Bratton and Watson 2018).

Social – The social fabric in the United Kingdom is one that has undergone a significant change in the last 25 years largely due to the fact that the UK is the preferred destination for most people looking to migrate to and settle down in Europe. As a result, most of the population residing in the UK today is a mixed population, with every third person in the UK being brown, black or of Asian ethnicity. This diversity in population is also witnessed in the HR policies that are adopted by companies doing business in the United Kingdom. Efforts are made on the part of business enterprises, including companies like Primark to recruit people from diverse ethnic backgrounds rather than only from the white native population. No discrimination is also made between white and Asian or black employees by such companies, and every attempt is made to make people of other ethnicities feel as welcome and as included as possible. Diversity is something that is recognized by the human resource management of most companies operating in the UK as essentially and profitable for business, especially given the global nature of businesses in the UK today. It is therefore no surprise to come across people who are natives of third world countries working in different positions in UK companies like Primark (Qudah et al. 2018).

Legal – Due to the Brexit movement in the UK in recent times, there are a number of controls and restrictions that have been imposed on companies in the UK as far as the recruitment of employees is concerned. Only those who have a legitimate work permit and residence permit in the United Kingdom will be allowed to stay and work in the UK and even such work permits will be those that are subject to continuous evaluation and scrutiny and of course renewal. Most of the migrant populations in the UK who are employed by companies in the UK in large numbers usually will have to be let go from their jobs, if this has not happened already. Post Brexit many migrant communities living in the UK are threatened with deportation, and this has generated a good deal of precariousness not only for such communities but also for the businesses they have been working for, who are unable to recruit cheap labor as easily and as conveniently as they had been able to in the past. The HR departments of companies such as Primark are faced with restrictions when it comes to recruiting certain types of people like migrant workers, which in turn makes it tough to achieve business goals and objectives as readily as had been feasible before (Andersen et al. 2017).

Technological – The technological advancements in the United Kingdom have been many, where the last 25 years are concerned. The use of computers and mobile phones has revolutionized shopping processes and transactions, with people taking recourse to the internet to buy the garments and groceries that they want and desire, and making transactions for them via internet banking methods. PayPal and the use of debit and credit cards are common modes of financial transactions in the UK today. The quick and easy online shopping process and the fact that customers can get to buy goods and services by using mobile apps and by logging into shopping websites online, has also made the remuneration process a more hassle free one for companies in the UK. The HR departments of the UK based companies are now able to pay their employees in an instant via internet banking methods, with the money being credited to their salaried accounts as soon as the transaction process is through. The employee recruitment process is also one that is carried out online, with job profiles being selected and reviewed on the internet and then candidates being asked to come and appear for an interview only if their profiles have been shortlisted. The Primark Company for instance follows an online recruitment process, and also pays its employees timely through internet banking services, with employees seldom finding the reason to complain about things such as non payment or delayed payment (Di Marco et al. 2017).

Environment – Concern about the environment is something that has been very well expressed in recent times by NGO’s and environmental activists operating in the UK. As a result, most of the companies that do business in the UK are those that have environmental concern and wellbeing as part of their policies and agendas. The human resource management in companies in the UK are seem to request their employees to show concern for the environment by not using plastic within the office premises, to avoid the wastage of water, among other things (Holbeche 2016).

Thus, the economic, political, social, legal and technological developments that have taken place in the United Kingdom in the last 25 years have indeed impacted the manner in which companies do their business in the UK and in particular, the manner in which human resource policies are conducted. The imposition of Brexit especially has made it tough for business houses in the UK to recruit cheap migrant labor in large numbers due to the several visa and other restrictions that now apply to them. 

References and Bibliography

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