13011413 Robert AlexandruTutu Moray College

1




HRM: An introduction
LO2

Robert Alexandru Tutu
13011413












13011413 Robert AlexandruTutu Moray College
2

Escape to the Wild is a successful company, which sells specialist clothing for
outdoor leisure pursuits through mail order and through a small number of retail
outlets. In the last few years the company grew and developed significantly thus
resulting in a workforce close to 300. Without a dedicated human resource function
the senior management is facing a lot of problems which would be better dealt by a
HRM department.
1.1 One of the key issues the company faces is when it comes to the training of new
staff members. Most of the times the process is chaotic and ad hoc. This means that
staff wont receive a proper training and wont know how to deal with many problems
that theyll have to face in the future thus resulting in unsatisfied clients, unsatisfied
employees and eventually profit loss. Therefore a proper training and development
programme is required. Having a HRM department to deal with the training and
development process will be very useful for the company. First of all the existing line
managers will be free to deal with their own problems. Also the staff will receive
proper training. This will increase their working skills and will also boost their
motivation which will decrease the chance of staff leaving the company and also
lower the absenteeism. By investing in a good training programme the company can
develop and promote its own managers which can focus on certain departments
meaning that the efficiency and the effectiveness of the business will increase. In
order to do quality training a research or an analysis is needed before to see which
will be the best option. Staff should attend the training at all times and be evaluated
periodically to see how the training goes. Also feedback should be provided in order
to improve the training and eliminate possible mistakes.
1.2 Another urgent issue would be the recruitment and selection programme. At this
moment senior managers recruit new staff. They also set their initial salary levels and
pay raises. Also the company continues to expand so more staff is needed meaning
that a recruitment and selection programme is required. This should also be done by
a HRM department in order to free the senior managers from the administrative
tasks. In order to apply this programme a few steps need to be undertaken:
Create and place advertisements (internally as well as externally)
Send application packs
Register all recruitment and application forms
Arrange and set up interviews and other selection activities
Inform the ones who passed the interview and direct them towards the training
programme
1.3 The finance director also deals with requests that should be addressed to a
different department. Therefore a fair compensation systems should be introduced
which will help with the following:
If an ideal compensation system is designed, it will have positive impact on the
efficiency and results produced by workmen.
13011413 Robert AlexandruTutu Moray College
3

Such system will encourage the normal worker to perform better and achieve
the standards fixed.
This system will encourage the process of job evaluation. It will also help in
setting up an ideal job evaluation, which will have transparency, and the
standards fixing would be more realistic and achievable.
Such a system would be well defined and uniform. It will be apply to all the
levels of the organization as a general system.
The system would be simple and flexible so that every worker/recipient would
be able to compute his own compensation receivable.
Such system would be easy to implement, so that it would not penalize the
workers for the reasons beyond their control and would not result in
exploitation of workers.
It will raise the morale, efficiency and cooperation among the workers. It, being
just and fair would provide satisfaction to the workers.
Such system would help management in complying with the various labor
acts.
Such system would also bring about amicable settlement of disputes between
the workmen union and management.
The system would embody itself the principle of equal work equal wages.
Encouragement for those who perform better and opportunities for those who
wish to excel. (Human Resource Management, n.d.)
1.4 In order to keep the staff motivated and continuously improve their skills a
performance management system should be implemented. Performance
management is integral to the success of any business or enterprise. It is
indispensable when it comes to tracking, sustaining and boosting the companys
performance and staying a mile ahead of the competition. Performance management
techniques can be understood to be industry specific practices that enable a
company to clearly formulate their goal plans and apply the same to achieve greater
results each time. This would be very useful for Escape to the Wild because it would
help them improve their further growth and development as a business. This will also
help the company to keep track of all the good things done by certain individuals and
reward them. (Patrick Alain, c. 2012-2014)






13011413 Robert AlexandruTutu Moray College
4

2.a












The HR office should be divided into 5 individual departments in order to increase the
efficiency and the quality of the work. All 5 departments respond directly to the head
HR manager. The recruitment department will deal with all the problems regarding
new staff. The new staff should be then trained by the training and development
department. The performance management and compensation/benefits departments
should work in close relation in order to keep the employees satisfied and motivated.
The career management department should offer consultation to any employee or
staff member willing to improve his job status within the company. The HR managers
and the line managers will be on the same level thus creating trust and security
amongst employees and will also help to minimise any potential issues where
existing managers feel power has been taken away. Both of them will respond
directly to the Financial Director which is under the Senior Managers department.
2.b Senior line managers should have a saying when it comes to recruitment and
training. This is important because they are the ones who know which way the
company is heading and which kind of resources are needed in order to achieve the
goals they set. They should also retain the responsibility of determining the initial
salary levels for new recruits because, as with any organisation that operates within
many different geographical locations, it is the local managers who will understand
local factors and pay rates. It is important that they meet the staff during the training
period in order to see who they are going to work with, what is their potential and how
they can improve their skills and motivate them so that they can maximize every
strong points and try to eliminate weaknesses.
HR Managers

Recruitment
Training
Development
Career
Management
Performance
Management
Compensation
Benefits
Line Managers

Senior
Managers

Financial
Director

13011413 Robert AlexandruTutu Moray College
5

2.c Modern businesses have been leveraging management information systems
(MIS) to manage, order, organize and manipulate the gigabytes and masses of
information generated for various purposes. MIS helps businesses optimize business
processes, address information needs of employees and various stakeholders and
take informed strategic decisions. However, budget allocation and monitoring issues
can affect the efficacy of MIS. It has its advantages and disadvantages depending on
organizational deployment and usage.
Advantages:
Decentralization is one of the biggest advantages; it allows monitoring of
operations at low levels and frees up resources for departmental managers to
devote time to strategic activities.
Coordination of specialized projects and activities is much better and decision
makers in the organization are aware of issues and problems in all
departments.
It minimizes information overload, which can be quite common with
conventional businesses in the modern era.
The purpose of MIS is to generate synthesized and processed information
from computerized/automated and certain manual systems. Information
distribution to all levels of corporate managers, professionals and key
executives becomes quite seamless with streamlined MIS.
Managers are able to make quick, timely and informed decisions. Top
management and board members can take strategic decisions, plan future
growth and business expansion activities based on the data and information
generated by MIS.
Ensures better planning for all activities and better ways to measure
performance, manage resources and facilitate compliance with industry and
government regulations.
Control helps in forecasting, preparing accurate budgets and providing the
tools and vital information to employees, top management and business
partners.
Disadvantages:
Allocation of budgets for MIS upgrades, modifications and other revisions can
be quite difficult at times. If budgets are not allocated uniformly or as per
immediate requirements, key functionalities might get effected and benefits
might not be realized consistently.
Integration issues with legacy systems can affect the quality of output and vital
business intelligence reports.
Change in management, exits or departures of department managers and
other senior executives have a broad effect on the working and monitoring of
certain organization practices including MIS systems.
13011413 Robert AlexandruTutu Moray College
6

MIS is a critical component of an organization's risk management strategy and
allied systems, constant monitoring is necessary to ensure its effectiveness.
Quality of inputs into MIS needs to be monitored; otherwise consistency in the
quality of data and information generated gets affected. (eHow, c. 1999-2014)
Bearing this in mind it obvious that Escape to the Wild should invest in a
computerized MIS. Although there are some negative aspects of using this system it
is clearly that the advantages overcome disadvantages. It will allow senior line
managers to deal with important matters while it will monitor the companys
operations and will free up resources. It will optimize the business process and will
increase productivity, efficiency and effectiveness.
3. A psychological contract most often refers to the unspoken agreements made
between an employer and an employee that communicates each others
expectations of the relationship. The terms of the contract exist in a mostly implied,
intangible form. The employee does not sign any papers and the employer makes no
formal promises, yet each party comprehends what the other is suggesting in terms
of input and outcome. Psychological contracts serve an important purpose when
honoured by both parties.
Loyalty - When both parties honour the psychological contract, a bond of loyalty is
formed between the two. When the employee shows that he is willing to put in as
much work as he implied and the boss' expectations prove fair, both parties will go
out of their way to maintain this positive relationship. The boss may offer the
employee a raise after the next annual review while the employee may pass up a
higher-paying job because he knows he will be treated well at his current job. This is
good for Escape tot the Wild because thy invest money in training and developing
their staff so its always better to try and keep the current employees.
Empathy - In this kind of working relationship, the ability to perceive one another as
human beings can make a big difference. A productive psychological contract
depends on the employer's ability to occasionally let an employee's shortcomings
slide, which will then result in the employee returning the favour. For example, a line
manager of Escape to the Wild may allow a good employee to miss a couple of extra
days of work due to a family emergency, even though this is against company policy.
The employee might return the favour by speeding up when his stressed-out boss is
under a tight deadline instead of becoming uncooperative.
Open Communication - When trust has been established through the psychological
contract, it makes it easier for both parties to exhibit openness and honesty. When
neither the employee nor the boss fear the possibility of betrayal, it is easier for each
to open up about personal needs, frustrations or experiences. This allows each to
respond in a healthy, productive manner. For example, if an employee finds himself
frustrated that his manager only gives him a two-hour notice before a report is due,
he may request a half-day's notice if he trusts the boss. This open communication
can prevent building animosity, which could deteriorate the psychological contract.
13011413 Robert AlexandruTutu Moray College
7

Satisfaction - When the terms of the psychological contract are honoured, all aspects
of the working relationship should run more smoothly. This greater degree of trust,
respect and understanding can lead to a positive, healthy relationship, a workplace
that is run in a more efficient manner and a greater degree of job satisfaction by both
parties. Greater enthusiasm for the job and higher morale go hand in hand, and may
feed positively into all other areas of the job. (eHow, c. 1999-2014)
Having an HR department is essential for any business no matter its size. Escape to
the Wild realised this as problems started building up. By investing into a quality HR
department you will free your other staff from doing unnecessary tasks and focus on
specific matters. This will show an increase in the overall well-being of the company.
It will also improve the business by making the employees happier and creating and
safe and pleasant work environment. All of these benefits will be reflected on the
companys efficiency and effectiveness thus increasing the profits, market share,
customer base, things that are paramount when wanting to improve or maintain a
successful business as Escape to the Wild is.
List of references
1. Human Resource Management (n.d.) Advantages of Fair Compensation
System [Online] available from
http://corehr.wordpress.com/compensation/reward-management/
2. Patrick Alain (c. 2012-2014) Performance Management [Online] available from
http://www.patrickalain.com/effective-management/performance-management/
3. eHow (c. 1999-2014) Advantages & Disadvantages Of Information
Management Systems [Online] available from
http://www.ehow.com/about_5494879_advantages-disadvantages-
information-management-systems.html
4. eHow (c. 1999-2014) The Advantages of Psychological Contracts [Online]
available from http://www.ehow.com/info_8469176_advantages-psychological-
contracts.html
5. Power Point presentations and other materials available on blackboard