Sheds Critical Light On Human Resource Management

Human Resource Management issues in Qatar Petroleum Company

Discuss about the Sheds Critical Light on Human Resource Management.

Human resource management is one of the key elements in an organization. Labour force is viewed as an indispensable part of an organization. Thus, management of the human resources is viewed as one of the critical areas in an organization (Weinstein 2014). Organizations channelize a major and significant portion of their energy and strategies in managing human resources. Thus, it becomes a critical area of concern regarding the management of human resources. However, the current age has seen various issues and loopholes in human resource management. The incidents of conflicts, strikes, lockouts, growing trend of dissatisfaction among employees highlight the issues in the human resource management avenue (Warr and Inceoglu 2012). Qatar petroleum is a petroleum company that is owned by the state in Qatar. The activities undertaken by the company includes exploration, transportation, storing, refining, and production of oil and gas. The human resource management is systematic and integrated in the company. The company is ranked third as the largest oil company in the company.

Management of labour and skills of labour is seen to be a major role of the human resource management of a company. In Qatar Petroleum Company, human resource management is viewed as a major area in the management of the company. The company has integrated and systematic method of management of human resource. According to reports and current findings, it has been seen that there are certain issues that are noticed in the human resource management issues. Motivating and retaining employees is seen to be a major issue in the human resource management issues in the company (Afioun, Ruël and Schuler 2014). It is seen that the company faces major shortcomings and issues in increasing the motivation among employees and retaining the employees. This is the human resource management issues that have risen in the company in the last few years. Motivation and retention are two sides of the same coin. The two elements go hand in hand. Retention is not possible without motivation. It is seen that employees leave organization because they lack the motivation and the level of morale that is needed for the employees to continue in the organization. It is a major cause of concern for the human resource management team. The human resource team of the company has witnessed major shortcomings and loopholes in increasing the motivation level among employees. One of the facts that are visible in this case is that motivation is influenced by both external as well as internal factors. The work environment, interpersonal relationship and the nature of the job profile is seen to be contributing factors of internal job motivation factors (Anthony and Hong 2014). The human resource management team has not been able to motivate the employees and increase their morale. The retention ration has decreased and the company has witnessed a major increase in the labour turnover ratio and absenteeism among employees. The human resource managers of the company believe in the notion that the employees would have the feeling of motivation within themselves. However, it is not true and it can be seen that motivation is about inducing people to discharge their responsibilities and duties to the best of their abilities.

Effect of the issue on Qatar Petroleum Company

The increasing rate of labour turnover has resulted in the shortage and scarcity of labour. The increasing rate of absenteeism and labour turnover has resulted in the sharp decline of the productivity and performance of the company. There have been growing incidents and episodes of conflicts and resistance from the end of the workers (Al Maita et al. 2015). It is a major cause of concern for the employees since it is seen that such conflicts would hamper the image and the productivity of the employees. The increasing labour turnover issue is an evil that stunts the growth of the company and acts as a major hindrance to the productivity issue of the company. Thus, it is a growing concern in Qatar Petroleum Company regarding these human resource management issues in the company. Various negative inferences of labour turnover can be seen. It has affected the financial performance of the company and it has escalated the expenditure level of the company. It can be seen that the cost of training and development of the new employees and the company has to compromise with its financial functioning that is noticed in the company. The lack of efficiency of the new employees has resulted in the company losing out on chances and opportunities to increase the productivity of the company. The financial performance of the company has received a major setback in terms of low profitability of the company. Thus, labour turnover and lack of motivation among employees and the inability of the company to retain employees have severe adverse effect on the financial performance of the company.

The quantity and the rate of production according to a given amount of time is defined and described as productivity. Qatar Petroleum Company has boasted of skilled and efficient employees and it has been seen that the inability of the company to retain employees and motivate employees has resulted in high labour turnover ratio in the last few years of the company. Thus, the productivity and performance of the company has suffered from major shortcomings (Bakker, Demerouti and Sanz-Vergel 2014). The induction of new and fresh employees has resulted in major drop in the level of performance of the company. This has a direct correlation with the competencies and skills of the workers. It has been seen that the company has a pool of new and fresh employees that has major shortcomings in the skills and competencies. Employees with shorter duration of work experience have issues in achieving production goals. The efficiency can also be linked with the evils of low employee retention in Qatar Petroleum Company. The lack of experience and competencies of the employees have turned to be a major issue for the company. As a result, the company has lower level of efficiency in the performance and productivity (Carpentier and Mageau 2014).

Cause of the issue

Another issue that high labour turnover and low retention of employees that exists is that it has given a negative image of the company to the public and as a result, it impacts the customer satisfaction aspect as well. The lack of experienced employees and the increase in fresh talent in the organization has given way to the inability of the company to meet the standards of the industry. High labour turnover causes experienced employees to shift from the company to different companies in search for better scope of growth and expansion of career. It can be seen that the company suffers from shortcomings in such aspects and as a result, the increase in inexperience employees has caused the company to suffer from inability to sustain the standards of quality that has been set according to the industry standards (Cherian and Jacob 2013).  Thus, one can say that it has majorly impacted the goodwill of the company.

Another effect of labour turnover issues is that it makes the company relatively and comparatively incompetent to sustain the competition in the industry. One thing that can be seen is that the low retention and low motivation quotient among experienced employees lead to low retention of such employees. In the light of these events it can be seen that the productivity and the ability of the company to sustain the competition depends on the experience and competency of the employees (Jerome 2013). Fresh and new employees might take a considerable amount of time to improve and harness the skill and to increase their level of competency and skills. The gestation period might make the company instable and incompetent to sustain the level of competition and it stunts the scope of growth and expansion of the company (Ealias and George 2012).  In addition to this, it has jeopardized the existence and the profitability of the company.

Figure: Qatar Crude oil exports 1986-2013

(Source: Afiouni, Ruël and Schuler 2014)

There is a cause and effect relationship between everything. One thing that needs to be kept in mind is that one needs to finds the roots of this evil. In other words, one needs to decipher the cause behind the low, motivation and low retention rate in Qatar Petroleum Company. There are various points that contribute to this issue. A significant fact that has to be assessed is that there are significant changes in the oil and gas companies. These changes have paved the way for the rising human resource management issues in the company. On carefully evaluating the changes in the industry, one can view that there are various external factor that are instrumental in creating such issues. Firstly, the increase in the competition can be viewed as a major issue in the rise of human resource management issues (Dedousis and Rutter 2015).  Initially, there were not many companies that belonged to the oil and gas industry. Thus, it can be said that there was a dearth in the competition in this industry. However, there was an initiative from the government to increase the production level in the country. This would require the setting up of many more companies in this industry that could contribute to the increased production, which on the other hand could increase the profitability of the government and could contribute to the positive economic growth. The consequence of this initiative could be viewed from this angle that this move has led to an increase in the number of local oil and gas companies in addition to international oil and gas companies. The numbers of ancillary and relative companies have also increased in the Qatar Market. One startling aspect of this change was the presence of cut throat competition in the industry. The escalation of the level of competition led to many employees terminating their service with national oil and gas companies and government organization in the quest of joining these companies in the oil and gas industry (Cerasoli, Nicklin and Ford 2014).  The rationale of these employees of making this move was regarding the pay scale and the remuneration. The pay scales of the government companies were limited and not attractive in comparison to the new private an international companies. The incentives schemes, work life balance and the scope of growth and expansion appeared limited in comparison to these companies. Thus, the experienced employees of Qatar Petroleum Company started leaving the company for greener pastures due to the low motivation level among them. This low motivation level contributed to the high labour turnover in the company. Secondly, another fact that could be evaluated as a cause for this issue is that, the increase in the number of private and public companies meant that the increase in the number of companies in the Qatar market would correlate to the issue of scarcity of labour (Faisal Ahammad et al. 2015). The shortage of labour and the growing scale of companies in the industries made this problem extremely critical. The scarcity of labour is not only pertaining to the Qatar market but it is a global phenomenon. Thirdly, one issue that could be spotted is that the expenditure of hiring and recruiting a local Qatar employee would be half compared to the cost of hiring and recruiting an employee from a different of country. The import and mobilization of labour could be costly for the oil and gas companies in the Qatar market (Kirat 2015).  This has led to an increase in the demand of local Qatar employees. Consequently, the pay scales of the new private and international companies were higher and more efficient compared to the Qatar Petroleum Company. It created resentment and low morale level among the employees of Qatar Petroleum Company and it contribute to one of the major issue of Human Resource Management in the company (Kossowska et al. 2014) The inability of the company to compete with new private and international companies in terms of pay scale and incentive schemes and the demand of local labour could be viewed as the reasons and the root cause for employees of Qatar Petroleum Company leaving their employer and this led to the issue of low motivation and low retention of employees in the company, which made the human resource management ponder over this critical issue.

Organizational change is one of the means of giving direction to the business, which is implemented for the organization to sustain growth and expansion in the longer run. The purpose of implementing organizational change is to cast a positive impact on the organization (Federici and Skaalvi 2012). However, it can be seen that managing such changes is a challenging task. The same was seen in the case of Qatar Petroleum Company. A starting fact that was seen was that organizational change in the company had a significant impact on the performance of task by the employees due to the perception of these changes by the workers (Fernandez and Ali 2015).

The effect of organizational change in Qatar Petroleum Company led to a rise in the level of doubts and stress among the workforce of the company. The labour force viewed these changes as a threat and a major challenge and it led to growing discontentment, tension and resistance to change among the employees. A major example of these changes was the increase in the number of strikes and retaliations from the employees. There were different kinds of change within the organization. One of them was the “total quality management” change in the organization. This was implemented with the intention that the company wanted to change the quality aspect of its operation, which could enable to survive the growing competition (Fernandez and Ali 2015). However, the company faced resistance and challenges due to the growing incompetency within them. This increased the low motivation index among the employees.

Figure: Employee’s Importance

(Source: Pinder 2014)

One of the common and conspicuous inferences among the employees regarding organization change was the increase in mental stress. The changes that were implemented by the management across the organization were viewed by the employees as a threat to their job profile and their tenure of work in the organization (De Baerdemaeker and Bruggeman 2015).  Some of the factors for this stress level were due to the perception of the changes as unfair move and as means to exploit the workforce of the organizations. The lack of communication by the management and the apprehension of similar changes in the future led to the growing discontentment among the employees (Pinder 2014). 

The organizational change that was implemented in Qatar Petroleum Company led to the decrease in the loyalty of workers towards the company. This was the product of low motivation among employees. The quality management change by the company had an adverse effect of the motivation and morale level of the employees. They viewed this as a means and the strategy to manipulate with their salaries and incentives (Miner 2015).  This loss of loyalty resulted in many employees shifting to different companies with a better scope of growth and expansion. The employees that continued in the company had low motivation and loyalty towards the company, which in itself was an adverse condition that the company had to face. It had a severe impact on their performance and productivity, which consequently impacted on the performance of the company (Kim and Scullion 2013).

Another significant impact of organizational change on motivation of employees was absenteeism and avoiding work. One inference that was majorly noticed was that those who resisted the organizational change started spending excess time away from work, which contributed to the extra incident of absenteeism at work. This was a major condition that could not be avoided. The low morale and low motivation among the employees and the implementation of organizational change resulted in a situation that was critical for the company. The growing incident of absenteeism at work was a major inference and impact of organizational change at work. The employees simply avoided the change and the work that was given to them.

Thus, it can be seen that organizational change severely and majorly hampered the motivation level of employees and in case of low motivation among employees it severely aggravated the situation leading to resistance and conflict. It led to increased tension, stress among the employees and it cause loss of loyalty, which resulted in labour turnover and consequently the human resource management had to deal with low retention issue and mismanagement and miscommunication among the employees were seen. The performance and productivity of the employees were severely hampered by the organizational changes in Qatar Petroleum Company (Kumar, Hossain and Nasrin 2015).

Presently, the feedbacks of the employees are being evaluated to bring about positive change and more training sessions are being conducted to communicate and explain the reason of change to the employees and in the process reduce their grievances and dissatisfaction.

Figure: Factors of employee motivations

(Source: Parker 2014)

Work culture is another aspect that needs to be analysed and evaluated to develop a comprehensive idea of the issue of low motivation and low morale among employees.  Every organization is unique in its own way. This unique feature of the organization paves the way for the definition of the term “work culture.” The term work culture refers to a system of value and norms that is shared within the organization and it contributes to the governance of the company. This has a strong and deep impact on the psychology of an employee and in the process affects the motivation of the employees. In the case of Qatar Petroleum Company, the organizational culture was based on achieving outcome and an aggressive culture in the organization to fight the competition in the industry.

In the current years it is seen that the work culture of the company has been viewed to be tentative and vulnerable to the extent that it caused negative energy and feelings among the employees. In the bid to sustain the increasing the competition in the oil and gas industry, it has been viewed that the company had increased its working hours and the level of performance to ensure quality performance (Parker 2014).  This had a negative effect on the employees leading to growing resentment and frustration among employees. This led to a decrease in the motivation level of employees. It reduced the employee participation in strategic operations and decision making of the employees. This was characterized by resentment and conflict from the employees, in order to change the organizational culture. This led to decease in the motivation and morale of the employees of the organization. It adversely affected the performance of the employees leading a decline in the standard of perform of the employees. The work culture had a detrimental effect on the motivation of the employees and made them incapable of achieving their goals, which in turn made the organization incapable of achieving its goals (Mowday, Porter and Steers 2013). The increasing mental stress and resentment among the employees due to work culture led to decrease in the quality of the performance of the employees and subsequent increase in the productivity of the employees.

The effect of work culture of Qatar Petroleum Company was that it led to emotional pressure on the employees. The aggressive work culture led to feeling of fear, apprehension and resentment among employees, which all led to the decrease in the motivation and morale of the employees. The work culture along with organizational changes in the company threatened the workers of the security of tenure and the revised nature of work. All of this led to high rate of labour turnover within the organization. The nature of work of the company was highly resisted by the employees and this led to the result of low productivity and low performance. It resulted in reduced potential of the employees since they did not believe that work would enhance their future prospective and identity.  It has been seen that the work culture in certain instances have led to positive changes in the organization, in terms of increasing the competency and skill of the employee. It did provide purpose and vision to achieve the goals. Mission and vision of the organization plays a major role in the work culture, which in turn has a major role on the motivation level of the employee (Sheikh, Newman and Al Azzeh, 2013).  The dissatisfaction of the employees regarding their purpose of work and the lack of the intrinsic motivation played a major role in reducing the motivation of the employees, which consequently led to labour turnover in the company.  The lack of scope of growth and expansion also led the employees to shift to different companies for better career growth and expansion and in the process improve and expand their career. The increasing competition in the oil and gas industry led to an aggressive work culture in the company, which led to the growing dissatisfaction and low motivation among employees (Skudiene and Auruskeviciene 2012).

Currently, the company is taking certain steps and measures to modify the work culture in the organization and shed more light and equal treatment of employees so that it increases their motivation and their loyalty towards the company. Assessment of different ideologies and goals of the company is made to induce a favourable work culture that would bring about a positive change in the organization (Sheikh, Newman and Al Azzeh 2013).

Emergence of conflicts is one of the most severe issues in an organization and it can significantly impact the behaviour and motivation of the employees. In general, conflicts in organizations led to lower productivity, decrease in the quality of performance and increase in the stress level of employees, which results in lower motivation and morale of the employees working in an organization. It reduces the belief and faith in the organization, resulting high labour turnover and low retention of employees in the organization.

It is seen that there were growing incidents of conflicts in Qatar petroleum Company. It resulted in strikes and hindrances in the operations of the company. These incidents compounded the current issue of low motivation among employees in the organization and resulting in low retention of employees due to high labour turnover ratio. The conflicts were a result of disagreements with regards to interests and ideologies. The growing incompatibility of ideologies between workers and management led to reduction in the productivity and performance of the workers and the motivation of the employees continued to decrease (Medina 2016).  The aggressive work culture and the growing competition in the industry led to an environment of resentment and frustration since the competitive ideology of the company resulted in negative conflicts in the workplace. However, more efforts are being made to induce healthy competition in the organization to give rise to positive. This could and to an extent has increased the productivity of a small section of employees (Parker 2014). The increasing level of conflicts within the organization has caused an increase in the level of labour turnover within the organization. The growing level of conflicts has resulted in dissatisfaction and low employee motivation (Scurry, Rodriguez and Bailouni 2013). The increase in the incidents of conflicts has led to a decrease in the productivity and performance of the employee, which consequently has a detrimental effect on the motivation of the employees. The interpersonal relationship between employees and management deteriorated, resulting in poor communication (www.emeraldinsight.com 2016). This hampered and dampened the morale of the employees. There have been positive aspects of conflicts within the organization since it induced creativity among human resource team to solve issues and formulate new policies that could be viewed as positive change in the organization backed by alignment of organizational goals and goals of the employees. However, generally it has majorly caused low motivation among employees and high rate of dissatisfaction among employees (Soutschek et al. 2014).

Currently, Qatar Petroleum Company is viewing these conflicts as the means to incorporate creative solutions to combat conflicts. The human resource team are taking measures to listen to the grievances and the point of debate from various members to induce amiable environment in the organization and facilitate better team work (Vaara et al. 2013).

There are certain recommendations that are made to improve the human resource issue in Qatar Petroleum Company. Some of these are:

Attractive Remuneration and incentives

One of the most important ways of improving motivation among employees is by rewarding the employees for the work they do. Paying quality incentives and remuneration increases the motivation of the employees. Paying bonuses based on the performances improves the motivation among employees. This would help to retain experience and quality employees and limit the rate of employee turnover in the organization.

Better work-Life Balance

Another way of improving the motivation among employees is by creating healthy work-life balance for the employees. This tends to increase the morale and motivation among the employees and in turn, increases the productivity and performance of the employees.

Better training programs

Better training programs need to be conducted to improve the skill and development of the employees. These training programs can be used to communicate about the rationales of organizations change and the evolving work culture of the organization. Training and development increases the motivation and morale of the employees.

Better communication

Better communication in the organization tends to bring about positive change in the organization. It results in better resolutions of conflicts and grievances in the organizations. At the same time it can be used to increase employee participation, which could increase the employee motivation and morale.

Conclusions

It can be viewed that low employee motivation and low employee retention is the human management issue in Qatar Petroleum Company. Low employee motivation, low employee retention and labour turnover are interrelated issues that exist in the company. It can be seen that increase in the competition in the oil and gas industry has contributed to the human resource issues in the company. In addition to this, scarcity of labour is also seen to be a cause of this evil. The current issue has resulted in low productivity, sub-standard performance and reduced profitability of the company. It has also resulted in the incompetency of the company to sustain the competition. The current organizational change, corporate culture and conflicts have resulted in negative impacts on employee motivation. The overall implications and conclusions that can be drawn is that there is a growing discontentment, low motivation among employees that have contributed to low employee retention and increasing labour turnover in the company.

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