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GAC fails in
three Human Resource Causes
Executive Summary:
GA Consultancy is one
of the most prestigious and a well known consulting company in Asia with 20
branches all over the world. It services is diverse in the field of
engineering, architectural, mining, construction and environments. The
structure consists of two matrix streams
namely, the knowledge which is
for training and developing employees resulting to productivity, effectiveness,
and efficiency among employees and the business streams which involved in the
growth of the business, acquiring contract from the business sectors, managing
projects and delivering these projects to the satisfaction of the clients.
Although the company is successful in consultancy business sector,
there are situational problems that cause the company to prevent its growth sustainability
in the marketplace. During the management audit the following are the operational
drawbacks of GCC:
·
A mismatch between the present market growth
potential over the current employee specialization.
·
Lack of planning and outdated operational
strategy
·
Lack of motivations among employee
·
Outdated knowledge streams that are relevant to
the technologically market sphere
·
Mission , Vision
goals and objectives are not emphasized and practice among employees
·
Employee engagement and commitment are lacking
The above mentioned weaknesses pre-suppose the GA
Consultancy weaknesses that hinders the process of growth and expansion of the
company.
Introduction:
The effects of increased economic pressures and demands for
greater competitiveness have drawn attention to the structural variables. The
movement towards tighter and leaner organizations has emphasized the importance
of alternative forms of structure and the demand of flexibility. According to
Eden, M, 2004, “ It is important to design at least part of the organization so
that it can recognize early the
direction in which uncertain situations will unfold, and so respond to change
and uncertainty in an opportunistic, flexible and effective manner”.
GA Business and Management Consultancies and Management
Today carried out a survey of 1,200 managers, from all types of organization,
in order to understand their attitudes to their employers and how they are
likely to change in the future. The survey draws attention to the changing
relationship between organizations and individuals and that ties to the
workplace will increasingly cease to be a hindrance.
There are four interconnected forces that have brought about
the changing environment:
·
Changes
in the shape of organizations themselves with outsourcing leading to a range of
previously in house processes and functions fulfilled elsewhere.
·
Changing
pattern of people’s working days with constant reference to flexibility. More
than two thirds of respondents spent a significant amount of time working
outside the organization.
·
The
pattern of people’s working lives taking a very different shape with the ending
of jobs for life and the active pursuit of career changes. Individuals
increasingly choose employment that allows them to work from home or provide
the latest technology;
·
The
impact of new technology enabling greater workforce mobility. However, although
technology is usually an enabler, it cans also disabling. For example, e-mail
is the most important activity in helping people get their job done but it is
also a burden.
2. Description of Management Function
Managers and
employees of GA Consultancy throughout an organization should participate early
and directly in strategic implementation decisions. Their role in strategy
implementation should build upon prior involvement in strategy formulation
activities. GA Consultancy personnel commitment to implementation is a
necessary and powerful motivational force for managers and employees. The
rationale for objectives and strategies should be understood clearly
communicated throughout an organization. Major competitors” accomplishments, products,
plans, actions and performance should be apparent to all organizational
members. Major external opportunities and threats should be clear and managers’
and employees’ question should be answered. Top down flow of communication is
essential for developing bottom up support.
GA
Consultancy needs to develop a competitor focus at all hierarchical levels by
gathering and widely distributing competitive intelligence; every employee of
GA Consultancy should be able to benchmark her or his effort against best in
class competitors so that the challenge becomes personal.
GA
Consultancy Management Issues Central to Corporate Strategies is:
1. Establish annual objectives
2. Devise policies
3. Alter existing organizational
structure
4. Restructure and Engineer
5. Revise reward and incentives plan
6. Match managers with strategy
7. Develop a strategy-supportive culture
8. Develop an effective human resources
function
9. Link performance and pay to
strategies
Annual Objectives
Establishing
objectives is decentralized activity that directly involves all managers in an
organization. GA Consultancy personnel should actively participate in
establishing annual objectives which can lead to acceptance and commitment.
Annual objectives are essential to GA Consultancy because they 1) serve as a
basis for allocating human resources 2) evaluate managers in their performance
appraisal are 3) as the main instrument
to monitor progress of the employee in achieving a long term objectives 4) establish organizational, divisional and
departmental priorities. It is always a procedure that the objective are to be
approved, revised or be rejected. The purpose of annual objectives can be
summarized as follows Padilla, J, 2010
“Annual objectives serve as guidelines for
action, directing and channeling efforts and activities of organization
members. They provide a source of legitimacy in an enterprise by justifying
activities to stakeholders. They serve as standards of performance. They serve
as an important source of employee motivation. They provide a basis for organizational
designs”.
Annual
objectives should be consistent, measurable, consistent, clear, challenging and
be communicated throughout the organization that are the characteristics by
appropriate time dimension and with rewards and punishment, reasonable,
challenging, clear, communicated throughout the organization, characterized by
an appropriate time dimension with rewards sanctions. Too often, objectives are
stated in generalities, with little operational usefulness. To improve GAC
communications and performance are to be specific , clear and measurable. Objectives should state quantity, quality,
cost and time –and also be verifiable. Terms and phrases such as maximize,
minimize, as soon as possible, and adequate should be avoided.
Policies
Changes in GA Consultancy strategic
direction do not occur automatically. On a day to day basis, polices are needed
to make strategy works. Policies facilitate solving recurring problems and
guide the strategic action. Broadly defined, policy refers to specific guidelines,
methods, procedures, rules, forms and administrative practices established to
support and encourage work towards stated goals. Policies are boundaries,
constraints, and limits on the kinds of administrative actions that can be
taken to reward and sanctions behavior of GAC personnel; they clarify what can
and cannot be done in pursuit of GAC objectives.
Policies let
both employees and managers know what is expected of them, thereby increasing
the likelihood that strategies will be implemented successfully. They provide a
basis for GA Consultancy management control, allow coordination across
organizational units, and reduce the amount of time managers spend making
decisions. Policies also clarify what work is to be done and by whom. They
promote delegation of decision making to appropriate managerial levels where
various problems usually raise, Wall Street Journal, (2001).
The Strategic Business Units
As the
number, size and diversity of divisions in an organization increase,
controlling and evaluating divisional operations becomes increasingly difficult
for GA Consultancy managers. Increases in sales often are not accompanied by
similar increases in profitability. The span of control SBUs accords to certain
common characteristics, such as competing in the same industry, being located
in the same area, or having the same customers.
Two
disadvantages of an SBU structure are that it requires an additional layer of
management, which increases salary expense. Also, the role group vice president
is often ambiguous. However, these limitations often do not outweigh the
advantages of improved coordination and accountability. Another advantage of
the SBU structure is that it makes the tasks of planning and control by the
corporate office more manageable.
Restructuring and Reengineering
Restructuring
and reengineering are becoming commonplace in the corporate landscape across
the United States, Europe, Asia and GCC countries. Restructuring also called
downsizing, rightsizing, de-layering, involves reducing size of the firm in
terms of number of employees , number of divisions or units, and number of
hierarchical levels in the GA Consultancy organizational structure, S. Ghostal
and C.A Bartlett, (2005) . This reduction in size is intended to improve both
efficiency and effectiveness in KTG. Restructuring is concerned primarily with
shareholder well-being rather than employee well being. Recessionary economic
conditions forced company to downsize, lying off managers and employees.
In contrast
reengineering is concerned more with employee and customer well being than
shareholder well being. Reengineering also called process management, process
innovation, or process redesign-involves reconfiguring or redesigning work,
jobs and process for the purpose of improving cost, quality, service and speed.
Reengineering does not usually affect the organizational structure or chart,
nor does it imply job loss or employee layoffs. Whereas restructuring is
concerned with eliminating or establishing, shrinking or enlarging and moving
organizational departments and divisions, the focus of reengineering is
changing the way work is actually carried out.
GAC can
employ restructuring when various ratios appear out of line with competitors as
determined through benchmarking. Benchmarking involves comparing a firm against
the best firm in the industry on a wide variety of performance related
criteria. GA Consultancy will benchmark ratios such as head count to sales
volume, corporate staff to operating employees, or span of control figures.
GA
Consultancy primary benefit is from restructuring cost reduction. It can rescue
the firm from global competition and demise. But the downside of this strategy
can reduced employee commitment, creativity, and innovation accompanies by
uncertainty and trauma associated with pending and actual employee layoffs, Sue
Shellenbarger, 2010.
GA
Consultancy manage more people spread
over different locations, travel more, manage diverse functions, and are
changed agents even when they have nothing to do with the creation of the plan
or disagree with its approach. GAC must look for people who can do things, not
for people who make other people do things. GAC managers need to be counselors,
motivators, financial advisors and psychologists. They also run the risk of
becoming technologically behind in their expertise.
GA
Consultancy present set up has led managers’ and employees’ mind set being
defined by their particular functions rather than by overall customer service,
service quality, or corporate performance
which are GA Consultancy weaknesses , Suzanne Vranica, (2010). The logic
is that GAC tend to bureaucratize over time. As routines became entrenched,
turf becomes delineated and defended, and politics takes precedence over
performance. Walls that exist in the physical workplace can be reflections of “mental”
walls.
In reengineering, GA Consultancy should use technology to
break down functional barriers and create a work system based on processes,
services, or outputs rather than on functions or inputs. Cornerstone of
reengineering is decentralization, reciprocal interdependence, and information
sharing. The Wall Street Journal, 2011 noted that reengineering today must go
beyond knocking down the external walls that prohibit or discourage cooperation
with other firms-even rival firms.
GA
Consultancy benefits of reengineering are that it offers employees to see more
clearly how their particular jobs affect the final services being marketed by
the firm. However, reengineering can also raise manager and employee anxiety,
which, unless calmed, can lead to corporate trauma.
3. The Environment in GA Consultancy
GA
Consultancy should strive to preserve, emphasize and build upon aspects of an
existing culture that support proposed new strategies. Aspects of an existing
culture that are antagonistic to a proposed strategy should be identified and
changed. Substantial research indicates that new strategies are often market
driven and dictated by competitive forces. For this reason, changing GA
Consultancy culture to fit a new strategy is usually more effective than
changing a strategy to fit an existing culture. There are numerous techniques
that are available to alter an organization’s culture, including recruitment,
training, transfer, promotion, and restructure of an organization’s design,
role modeling, positive reinforcement, and mentoring.
Schein, L,
2004 indicated that the following elements are most useful in linking culture
to strategy:
·
Formal
statements of organizational philosophy, charters, creeds, material used for
recruitment and selection, and socialization
·
Designing
of physical space, facades, buildings
·
Deliberate
role modeling, teaching, and coaching of leaders
·
Explicit
reward and status system. Promotion criteria
In the
personal and religious side of life, the impact of loss and change is easy to
see. Memories of loss and change often haunt individuals and organization for
years. Ibsen, N 2005 wrote “Rob the average man of his life illusion and you
rob him of his happiness at the same stroke”. When attachments to a culture are
severed in an organization’s attempt to change direction, employees and
managers often experience deep feelings of grief. This phenomenon commonly
occurs when external conditions dictate the need for a new strategy. Managers
and employees struggle to find meaning in a situation that changed many years
before. Some people find comfort in memories; others find solace in the present.
Weak linkages between GA Consultancy management
Human Resource Concern when
implementing strategies
The job of
human resource manager is changing rapidly as GA Consultancy continues to
downsize and reorganize. Strategic responsibilities of the human resource
manager include assessing the staffing needs and costs for alternative
strategies proposed during the strategic planning and developing a staffing
plan for effectively implementing strategies. This plan must consider how best
to manage spiraling health care insurance care. Employer’s health coverage
expenses consume an average 26% of firm’s net profit, even though most
companies now require employees to pay part of their health insurance premiums.
The human
resource department must develop performance incentives that clearly link
performance and pay to strategies. The process of empowering managers and
employees through involvement in strategic management activities yields the greatest
benefits when all GAC members understand clearly how they will benefit
personally if the firm does well. Linking company and personal benefits is a
major new strategic responsibility of human resource managers. Other new
responsibilities for human resource may include establishing and administering
an employee stock ownership plan (ESOP), instituting an effective child care
policy, and providing leadership for managers and employees in the way that
allows them to balance work and family.
1. Disruption of social and political
structures
2. Failure to match individual’s
aptitudes with implementation tasks
3. Inadequate top management support for
implementation activities.
Strategic
implementation poses a threat to many managers and employees in GA Consultancy.
New power and status relationships are anticipated and realized. New formal and
informal groups’ values, beliefs, and priorities may be largely unknown.
Managers and employees may become engaged in resistance behavior as their
roles, prerogatives, and power in the firm change. Disruption of social and
political structures that accompany strategy execution must be anticipated and
considered during strategy formulation and managed during strategy
implementation.
A concern in
matching managers with strategy is that jobs have specific and relatively
static responsibilities, although people are dynamic in their personal
development. Commonly used methods that match managers with strategies to be
implemented include transferring managers, developing leadership workshops,
offering career development activities, promotions, job enlargement , and job
enrichment , Dale McConkey, (2001) .
A number of
other guidelines can help ensure that human relationships facilitate rather than
disrupt strategy implementation efforts. Specifically managers should do a lot
of chatting and informal questioning to stay abreast of how things are
progressing and to know when to intervene. Managers of GAC can build support by
giving few orders, announcing few decisions, depending heavily on informal
questioning and seeking to probe and clarify until consensus emerges. Key
thrusts that succeed should be rewarded generously and visibly.
Inadequate
support from GAC management often undermines organizational success. Chief
executives must be committed to strategy implementation and express this
commitment in highly visible ways. It must be consistent with actual rewards
given for activities completed and objectives reached. GAC must involve as many managers and
employees as possible in the process. Although time consuming, this approach
builds understanding, trust, confidence, commitment, and ownership and reduces
hostility and resentment.
Motivation:
Employee
Stock Ownership Plans (ESOPs)
An ESOP is a
tax qualified, defined contribution, employee benefit plan whereby employees
purchase stock of the company through borrowed money or cash contribution.
ESOPs empower employees to work as owners; this is a primary reason why the number
of ESOPs has grown dramatically to more than 12,000 firm covering 17Million
employees (Chan, M, 2012).
Beside
reducing worker alienation and stimulating productivity, ESOPs allow firms
other benefits, such as substantial tax savings. Banks lend money to ESOPs at
interest rates below prime. This money can be repaid in pretax, lowering the
debt service as 30 percent in some cases.
4.
Communication
GA
Consultancy failure to recognize and understand relationship among functional
areas of business can be detrimental to the firm, and the number of those
relationships that must be managed increases dramatically with the firm’s size,
diversity, geographic dispersion, and the number of services offered.
Communication,
perhaps play a most important word in management, is a major component of
motivation. An organization’s system of communication determines whether
strategies can be implemented successfully. Good two way communication is vital
for gaining support for departmental and divisional objectives and policies.
The strategic management process becomes a lot easier when subordinates
encouraged to discuss their concerns, reveal their problems, and provide
recommendations and suggestions.
Recommendation and Conclusion
Motivation
explains why some people work hard to accomplish specific objectives.
Objectives, strategies, and policies have little chance of succeeding if
employees and managers are not motivated to implement strategies once they are
formulated. The motivating function of management includes at least four
components: leadership, group dynamics, and communications and organizational,
Dale McConkey, (2002).
When
managers and employees of GA Consultancy strive to achieve high levels of
productivity, this indicates that the firm’s strategists are good leaders. Good
leaders establish rapport with subordinates, empathize with their needs and
concern, set a good example, and are trustworthy and fair. Leadership includes developing
a vision of the firm’s future and inspiring people to work hard to achieve that
vision. Kirkpatrick and Locke, 2005, reported that certain traits also
characterize effective leaders: knowledge of the business, cognitive ability,
self confidence, honesty, integrity, and drive.
Research
suggests that democratic behavior on the part of the leaders result in more
attitudes toward change and higher productivity than autocratic behavior.
Drucker , 2004 said
“Leadership
is not a magnetic personality. That can just as well be demagoguery. It is not
“making friends and influencing people”. That is flattery. Leadership is
lifting of a person’s vision to higher sights, the raising of person’s
performance to a higher standard, the building of a person’s personality beyond
its normal limitations”.
Group
dynamics play a major role in employee morale and satisfaction. Informal groups
or coalitions form in every organization. The norms of coalitions can range
from being positive to negative toward management. It is important therefore,
that GAC management identifies the composition and nature of informal groups to
facilitate corporate strategy.
Reference:
Chan, M.
2010, Organizational Behavior, 1st edition, Prentice Hall, pp98-100
Dale
McConkey. “Planning in A Changing Environment” Business Horizons, September-
October 2002)
Drucker, P.F (1980) P.F. Managing for Results, Heinemann
Professional (1989)
Eden, M, 2004, Outsider CEO: Inspiring Change with Force and
Grace”, USA Today (July 19, 2004):3B pp26-27
S. Ghostal
and C.A Bartlett, : Changing the Role of Management: Beyond Structure to
Processes”, Harvard Business Review 73
,1 2005; p 14
Want To Be A
Manager? Many People Say No, Calling Job Miserable . Wall Street Journal ,
April 4, 2001, 1 pp45
E, Schien ,
The Role of the Founder in Creating Organizational Culture, “ Organizational
Dynamics (Summer 2001), pp 13-28
H. Ibsen ,
The Paradox of Corporate Culture, California Management Review 28, no. 2 (1998)
pp 37- 40
Padilla, J.
2010, Strategic Management, 2nd edition, pp124-136, Prentice Hill
Sue
Shellenbarger, “Employers Often Ignore Office Affairs, Leaving Co- workers in
Difficult Spot, “Wall Street Journal , November 29, 2010 B7, pp 15-18
Suzanne
Vranica, Ad Firms Heed Diversity.” Wall Street Journal, November 29, 2010, B7
pp34-36
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