Module Title: Managing People.

Assignment Type: Case Study Report

Submitted by: Rafiq Miazi Begum

Student ID: S214379

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Table of Contents
Task 1: Identifying issues (Introduction) ........................................................................................ 1

Task 2: Relevant HRM models and Theories used in FarmBox .................................................... 2

Task 3: Assessing the appropriateness of the models ..................................................................... 3

Task 4: Identifying and recommending models to FarmBox ......................................................... 6

Conclusion ...................................................................................................................................... 8

References ....................................................................................................................................... 9

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Table of figures
Figure 1: Michigan Model of HRM (Rosanna, 2012) .................................................................... 4
Figure 2: Human Capital theory effects (source: Author) .............................................................. 5

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Task 1: Identifying issues (Introduction)
FarmBox is apparently a fast-growing company struck by good fortune during the pandemic. The
company has introduced an online-based fresh vegetable ordering business before and during the
lockdown period the business took off. The FarmBox Company was previously using only two
farmhands along with labour from the owners to perform the value creation activities of the firm,
but as the demand has risen, they are having to expand their operations. This is where the problems
started. The company have very little time for expansion as the demand is growing very swiftly
and the company needs to ensure a superior level of customer service unless it wants to be filled
with custom reports. The new recruitment policy of the company is not working for it. The recruits
are facing increasing problems with working in the company, they are not being able to give their
best or simply are not good enough for the performance enhancement of the company. The
company is currently using a very cursory method of bringing in recruits. The applicants are not
properly examined and understood. The twenty-minute interview may as well be an organizational
formality meaning nothing. The main problem with the company at this moment lies with the fact
that the company is failing to properly implement a recruitment and selection strategy. The
company is also giving too little time for introducing the recruits in the workplace, which shows
the disorientation of the recruits with the organizational environment and processes. However, the
main problem lies with reforming the recruitment practices and managing the motivational factors
in the organization. This will ensure the recruitment of the right people and retaining them in the
near future so that they continue to create value for the organization. This assignment focuses on
just that.

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Task 2: Relevant HRM models and Theories used in FarmBox
The company is making use of a crude form of the Michigan model and 5Ps model of human
resources administration. Michigan model implies that the firm needs to follow the external and
internal variables that define the HRM strategies of the firm (Armstrong, 2017). While external
demands go up, the firm is supposed to recruit employees. When the external demand for the firm's
products goes down, the firm is supposed to furlough employees or outright downsize. Also, the
HRM policies of the firm need to review in light of the existing external forces and industry
standards (Kew and Stredwick, 2016). FarmBox Company is currently focusing on the demand
and supply part only. The demand for the firm's products have gone up, so based on this situation
the firm is trying to recruit new employees to meet that higher demand and create value for the
organization. The wages and benefits of these employees are being set by the industry standard.
As the company is not very large, it doesn't have the ability to pay out large bonuses or large
salaries. It is giving what it can under the circumstances.

5Ps model of HRM administration implies that the firm, at any given time, must coordinate the
five most important elements that govern the productivity of the human resources of the firm
(Marchington, 2016). These factors are principles, purpose, people, processes and performance.
Aligning all these factors take work, also given so many moving pieces, the problem becomes
much convoluted and create inefficiencies (Rees and French, 2013). The administrators and the
owners of the firm are not trained in HRM, therefore they are using crude methods to build up a
strategy that will ensure the alignment of all these factors in no time. The firm doesn't have any
clearly defined set of principles, which kind of puts the firm at a disadvantage while trying to build
a coherent human resource strategy. But the firm has clearly defined processes that enable it to
provide some unique products to the customers. The firm has minimal support or emphasis for the
people who work for them. This is quickly envisioned by the fact that the firm is spending too little
time on due diligence while getting recruits for the firm and is giving them too little time to adjust
to the new working environment. According to the theory though, the firm needs to spend enough
time and resources to ensure proper rules and regulations while introducing new employees and
having clearly defined guidelines that govern the training needs of the employees, both new and
old. However, the firm is currently working without the support of a clearly defined framework
which is making the process inefficient and possibly insidious.

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Clear performance management is also a pillar of the talent management process (Barrett, 2021).
Performance management and its subsequent actions define whether the firm will be able to retain
good workers the firm or not. If the firm fails to introduce a proper performance evaluation system
in place, the employees, especially the high performing employees, will lose heart and think of
leaving the organization (Salome and Joy, 2021). This is happening at the firm at this moment,
some employees are contemplating leaving the firm for alternative employment options as that
will provide them with some better options and benefits. Also, they will likely be appreciated better
in those companies. It is very dangerous for a firm when the ambitious good workers find
themselves in an impasse in their careers in the firm (Charlee, 2015).

The human capital model is somewhat applicable in the situation of the firm. The human capital
model focuses on building human resources based on the activities and abilities brought in by the
recruits and the workers of the firm (Sylvester, 2021). The model supports wage discrepancy. If a
worker brings in more value for the firm than the other workers then he or she is entitled to have
more wages and greater benefits (Egbert, 2021). This is a reason why recruits are often paid less
than experienced workers even when they are doing the same job. The experienced workers receive
more compensation because of his or her higher experience level and better standards of working.
FarmBox Company is probably using it to ensure the retention of the older workers who have more
experience in handling the inner processes of the company. However, it is not enough to ensure
talent retention and growth of the firm.

Task 3: Assessing the appropriateness of the models

The previous section enunciated that the FarmBox Company is currently using three models to
govern its human resource management and policymaking. This section aims to elaborate on the
appropriateness of using these models and the positive and negative aspects of using them.

The company is making use of the Michigan model to make sure that the firm's HRM practices,
salaries and wages, in particular, are in line with the industry standard. This prevents the firm from
being blindsided by the industry practices and being side-lined by the prospective workers because
of lower relative benefits and salaries. However, the ability of the firm is also limited by the fact
that it is a small company with a small operation that is only recently undergoing some expansion
(Nixon, 2017). The company is not even sure that such expansion is going to be permanent.

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Therefore, the benefits and salaries offered by the firm will hardly ever cross the median industry
salaries and wages for the jobs done. Relying too much on the industry standards will also prevent
the firm from being innovative. Managing talents and retaining the people who work for the firm
will require tact and innovation, blindly following industry standards will erase any advantage the
firm has over the other firms to ensure talent retention and correct performance management
(Rosanna, 2012). Also, the firm needs to understand that every organization has a different formula
for creating value. Therefore, their processes are also unique. The human resource management
practices should reflect that fact and ensure proper procedures in place.

Figure 1: Michigan Model of HRM (Rosanna, 2012)

5Ps model, on the other hand, is a very important and relevant theory for the firm. The firm is
following the 5Ps model very crudely. The owners and the administrators of the firm are not well
acquainted with the models and practices of human resource management, which is forcing them
to use crude methods to align the people, processes and performance. The firm is spending only
twenty minutes on average on interviewing and evaluating a recruit, this opens up a host of
opportunities for mishaps to happen. The choices of the firm are not properly evaluated and their
abilities are not properly tested before putting them to work. The processes of the firm are being
hampered by the fact that the firm is spending very little time to orient the employees into the new
working environment. 2 weeks are not enough to ensure proper orientation and training which
would allow the firm to achieve maximum productivity and effectiveness (Jayceon, 2021). It is
already mentioned in the case study the firm is suffering from a level of productivity loss and

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mismanagement of resources. All of these can be traced back to the fact that the firm is spending
way too little time properly evaluating and training the recruits to handle the activities and value
creation of the firm.

Figure 2: Human Capital theory effects (source: Author)

Finally, using human capital theory is not the best possible method for the firm to ensure proper
investment in human resources (Timotha, 2018). While it is true that people having higher
qualifications and abilities will expect greater reward from the organization, keeping the
discrepancy in pay too much will harm the organizational reputation and motivation of the
workers, particularly the new workers. The new workers want to be assured that they have picked
the right organization and therefore will not see favourably when they see too much of a gap in
payments made out to them and the experienced workers (Colby and Flanagan, 2015). Also, large
pay gaps may harm the organizational culture and create sub-groups which will increase
organizational conflicts (Barrett, 2021). It is recommended that the firm should pay the
experienced workers more, but strong vigilance must be exercised on the pay gaps and
motivational situation of the workers. Organizational culture is something that is not easily going
rid of. Therefore, the organization must pay extra attention to building up a reliable and good
organizational culture. Pay gaps may become a hurdle to deal with when the firm tries to expand
the workforce and bring in new workers as it directly serves as a warning sign for the recruits

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(Salome and Joy, 2021). The human capital theory also dehumanizes the workers to some extent
and only values the amount of work they do for the organization. Several works cannot be
measured with a human capital theory-based performance management. For example, customer
service is not a measurable criterion while it is a valuable part of worker interaction for any given
organization.

Task 4: Identifying and recommending models to FarmBox

The organization may try to use AMO theory to make the process of human resource management
better. AMO theory introduces three main concepts for administering human resource
management (Charlee, 2015). The concepts are ability, motivation and opportunity for the
workers. The ability of the workers is governed by their training and the starting level of efficiency
and effectiveness they bring to the organization. Motivation depends on the subsequent treatment
they receive, the distribution of organizational reward and the overall culture of the organization
(Sylvester, 2021). Finally, the opportunity for the workers defines the future involvement of the
workers with the organization. If the workers believe that their future has hit an impasse with the
organization, they are not going to stay at the organization for long. Firstly the organization needs
to ensure a proper understanding of the abilities of the prospective workers. Only a twenty-minute
interview is not enough for that. Several methods can be used for a real-life understanding of the
effectiveness the workers are capable of bringing to the organization. For example, the simulation
might be a good idea to test the ability of the worker to handle situations and evaluating how they
react to the different types of customer responses. The ability of the workers also depends on the
training and orientation he or she receives. The organization must spend more time or make the
training and orientation process more effective to improve the abilities of the workers in the short
and long run. Depending on the execution, the true nature of the human resource of the firm will
be evaluated (Egbert, 2021). The motivation of the workers will also depend on the overall
organizational culture and distribution of organizational resources. The use of human capital
theory, in this case, is insidious and might prove to be counterproductive to organizational
productivity and organizational justice. The opportunity for the workers will depend on the future
expansion and sustenance of the business in the long run (Nixon, 2017). To achieve that, the
business must be focused on achieving a competitive advantage and provide financial
advancement for the workers.

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Improved implementation of the 5Ps model is necessary for the firm. 5Ps model is very relevant
in the case of FarmBox and therefore must be used with enough importance. The people part of
the model ensures that the firm has the right people at the right time which ensures the most
productivity (Rosanna, 2012). Managing people involves the overall administration of the talents,
skills and motivation at the whole company. The company must create a coherent purpose that
guides the human resource management of the firm. The purpose will make it easier for the firm
to focus on the right type of people and the overarching goal of the firm. The processes that create
value for the organization also might create some problems if the organization fails to properly
introduce the recruits in the working environment and they are not given enough training on
performing the tasks for the organization. The organization also needs to maintain morale and
motivation by properly introducing an effective performance management system that can ensure
better talent retention and performance evaluation. This might help the organization to some extent
with the level of brain drain being experienced by the organization. Better performance
management leads to a better distribution of organizational resources, which in turn ensures better
causality between effort put by the workers and the level of organizational rewards received by the
worker. This leads to better motivation according to Vroom's expectancy theory (Jayceon, 2021).

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Conclusion
Based on the given information, the main problem of the company is adopting primitive and
inappropriate models of human resources administration and not using proper methods to evaluate
and strengthen the organizational workforce. By implementing the right choices and the right
models, the organization can benefit from better human resources and save itself from the current
predicament where its business is gradually becoming unprofitable because of poor human
resources administration. The assignment tries to evaluate the situation and point out the relevant
issues that are causing this thing to happen. Furthermore, it provides the company with some
recommendations as to how to recover from this situation and prevent future occurrences of the
same thing.

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References
Armstrong. M. (2017). Handbook of Human Resource Management Practice, 12th Edition, Kogan
Page.

Barrett, K. (2021). Reaping the Dividends of Training. Journal of Finance and Investments,
2021(6), pp.12-14.

Charlee, T. (2015). Valuing Human Resources and its Contribution. Journal of Finance and
Investments, 2017(17), pp.19-45.

Colby, M. and Flanagan, A. (2015). A Quantitative Study of Leadership and Human Resource
Management. Journal of Managerial Sciences, 2017(5), pp.65-67.

Egbert, F. (2021). Why Human Resource Management Matters. Journal of Human Resource
Development, 2021(5), pp.5-16.

Jayceon, T. (2021). Building Organizational Culture as a Part of Competitive Advantage. Journal

of Cultural Studies, 2019(2), pp.12-14.

Kew, J. and Stredwick, J. (2016). Human Resource Management in a Business Context, 3rd
Edition, CIPD

Marchington, et al., (2016). Human Resource Management at Work, 6th Edition, CIPD

Nixon, N. (2017). Values behind Human Resource Management and Leadership. Journal of
Human Resources, 2017(9), pp.8-11.

Rees, G. and French, R. (2013). Leading, Managing and Developing People, 4th Edition, CIPD

Rosanna, H. (2012). How Leadership Changes an Organization. Journal of Leadership and

Cultural Studies, 2020(3), pp.65-78.

Salome, G. and Joy, A. (2021). How to ensure a smooth transition in the organization while
acquiring other companies. Journal of Finance, 2021(8), pp.56-57.

Sylvester, K. (2021). Measuring the Return on Investment from Human Resources. Journal of
Finance and Investments, 2021(9), pp.21-22.

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Timotha, H. (2018). Good versus Bad Leadership and Their Implications for the Larger
Firm. Journal of Management Studies, 2020(6), pp.13-15.

Torrington, D., Hall, L., Atkinson, C. and Taylor, S. (2016). Human Resource Management, 10th
Edition, Pearson.

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