Write an essay on The referred Steel Company.
The referred Steel Company is a small scale manufacturing company. The owner manager and some of the employees are active in the company. There are about 65 people, with full time, permanent as well as unskilled people. The company is segmented into two departments, one is the sales team, and other is the manufacturing team. The divisional director divided the employees into four groups each with a team leader for more efficiency of the company. Implementation of the formal statement and the formal rule were formulated by the division director to manage the individual team and individual management of the teams. Finally, the divisional director formulated a new staff forum through which the employees could raise their issues of concern (Patel et al. 2012). The director expected that the employees would do the certain jobs by which they could increase the manufacturing rate. After one year of implementation of new management rules, the divisional director reviewed the situation. After realization he was disappointed enough for less and nil productivity of the employees.
Individual performances for the improvement:
Employees at Steel Co. were not fully committed to their work. Freeze in payment further worsened the situation. The effort of bonus schemes by division of work among different team also failed. Despite implementing a forum for concerns of employee, they were not able to enhance performance of employees. The need is for the implementation of specific HR strategy that allows goals to be integrated through performance management in each employee. The human resource manager should be vested with the responsibility of recruiting the employee with greater skills. Senior leader has the duty in allotting responsibilities to the employees and other staffs of the company. The responsibilities of the business leaders include definite factors such as plan; do; check; and act. This PDCA cycle or the plan-do-check act increases the service for the improvement of the company. Different staffs of the company have to undergo the PDCA cycle or the plan-do-check act. Here they have to take definite responsibilities of their own. As a result contribute to the betterment of the company. The primary posts follow the PDCA cycle or the plan-do-check act, and follow strategic factors such as: business leaders, process owner, operational manager, process operator, and team leader. HR managers should align employee development plan with business goals. They need to have a face-to-face discussion with each team to determine their expectation and aspirations in career. They should identify what skills employee needs to progress in their career and accordingly develop an action plan. Mentoring skill is important to influence and inspire employees. They should consider investing in employees betterment to achieve better profitability and reputation.(Akyildiz et al. 2015)
Importance of performance management in improving employee development and communications:
Steel Co. was failing in its business because of poor performance and little profit in a market with increased competition and difficult trading conditions. It forced the owner to freeze all employees’ salary for three years and removing all additional pay schemes. This was not a clever step by the owner as it naturally lead to resentment among employees. He should learn ways of implementing performance management system in his organization.
Performance management process is important in evaluating individual performance and optimizing productivity. It involves aligning employee’s daily objective with business objectives. It gives visibility and clarity to performance expectations. It is an approach to documenting individual performance and enhancing growth in career. The major focus is on looking after employees concern. But all these approach was missing in Steel Co. The owner had an autocratic style of leadership. He never viewed employee as an asset to the company, but rather he imposed decisions on them. He regarded them as a cost to business and so he invetsed little on them. This might be the factor for least employee engagement.
In the case study, the Steel Company had less frequent communication between the employees and the leaders. Therefore, the surprising decrease in the job skills of the employees came into focus. Communicating clear goals and expectations to the employees is necessary in performance management. (Lee et al. 2014). The majority of the employees want to be a part of the compelling future. The productivity level matters the most in establishing and maintaining a definite stand point of a company. Sharing of the information through every level of the company influences the management and the job skills. Employees are to be informed with respective information to keep communication hopeful and trust.
Effective practices in performance management system include:
- Communicating clear performance expectation to employees.
- Linking performance to reward system.
- Setting influential career path for employees.
- Delivering reward and payment scheme in a fair manner.
The primary reason for adapting performance management system in organization is that it has enabled them creating link between strategic business goals and daily activities. The atmosphere in the organization should be such that employee feels a sense of belonging in the organization. They should not just be limited to shift timings. They should be willing to contribute more and more for the betterment of the company. This will become possible when employees grievances are addressed properly. Performance management gives options for technology based solution where information is effectively disseminated among all employees. It helps to maintain corporate competencies and fill skill gaps among employees. It helps in identification of appropriate training and development plan for workforce (Den Hartog et al. 2013). The divisional director of the respective Steel Company only had the interest in formulating few management plans and job skills for the employees. He did not focus on the innovation and encouragement for the employees. Encouragements serve as the major and the primary factor for acquiring the work and utilize the entire job processing from the employees.
Integrated management systems:
There was a significant gap in communication between owner and employees at Steel Co. Despite creation of employee forum, the performance of employees did not improve. Performance management is the key to improving communication in organization. The integrated management system is critical to modifying an organization's real-time analysis of the performance and provides insights of the decisions across the enterprise. It optimizes the work performances, and improves the demand planning in operational areas such as sales, marketing, and production. The Steel Company had two sections, the first is the sales department and the second is the production department (Jiang et al. 2012). Therefore, the integrated management system is the central aspect to managing the ethical values, customer probability, external reporting, and meeting the integration to achieve technical advancements. However, no matter how sound the strategy or advanced the technology is, solutions that do not prioritize integration fail to meet expectations. The approaches which are to be focused on the industrial domains are energy, retail, manufacturing, and distribution. Other factors are the high-tech duty, manufacturing, production, and construction, transportation, and consumer production sectors (Asif et al. 2013).
Effectiveness to financial reward:
Even after Divisional Director’s effort of implementing bonus schemes and staff forum for raising employee voice, he could not bring change in performance management. When asked from employees about bonus scheme, they revealed that it did not have substantial impact on their standard of living. Thus a better way of linking reward to performance was needed to enhance employee engagement and commitment at Steel Co. Performance based reward culture is a tool for achieving success as it helps to unlock hidden potential of employees. It motivates them to perform in a better way. Appropriate performance based reward system leads to clearer goal alignment, reducing employee turnover rate, greater financial savings and more productivity. When employee’s efforts are appreciated and rewarded, they get more focused in their job. It is an efficient way of effective performance management in organization. Talent management and succession planning is possible by aligning employee objective to business goals. Regular performance appraisal, recognizing employee’s effort and giving them support to further develop their skills helps in building a strong relationship with owners of organization. Well-structured organization has access to all necessary information to reward employees for exceptional performance. They track employee performance against defined goals and reward them accordingly. Performance based reward culture is also beneficial in saving money on unnecessary activities which has no direct impact on success of organization. Retaining more employees means reduced expenditure in advertising and recruitment process to fill back vacant positions (Van Dooren et al., 2015).
According to the case study, it can be concluded that several factors are responsible for the improvement in the job skills. The communication and the innovations proved to be the best aspect which helps the company reach the epitome of success. The respective Steel Company, which was discussed in the case study, showed that the leaders and the employees had no connections and there was a lack of good communicative relationship. These elements are the basic factors for establishing a company. Moreover achieving the desired results from the productivity of the company also depends on this. The salary structure which was delivered to the employees did not hold the interests of the employees and therefore the director could not get the desired results out of the employees. It can also be concluded that producing different financial plans build up a good company with high productivity results. But the leaders of the company should hold up the plans which demonstrate the good future of the employees. High salary and bonus scales with no mental satisfaction and no disciplines would decrease the job productivity at the end of the season. The Divisional Director, who imposed the staff management facts, would ensure the work efficiency of the staffs and the production scales of the company.
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