CIMA E1 Official Learning System - Enterprise Operations Aug 2009

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MANAGING HUMAN CAPITAL

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1.6

Advantages

●

empowerment/delegation strengthened

●

in touch with detailed issues

●

greater local knowledge

●

visible.

Disadvantages

●

lack of central control

●

lack of specialist knowledge

●

may lead to ‘maverick’ actions/policies

●

HR function may be diluted

●

uneven provision within organisation.

1.7

Organisational Individual candidates

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Job description

●

Completed application

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Person speciﬁ cation

●

Structure and other detail

●

References

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Standard assessment form

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Letter of application

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Pay scales

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Policies

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Terms and conditions of service

Solution 2

2.1 (D)

2.2 (B)

2.3 (C)

Solution 3

(a) Draft Human Resource Plan

The human resource plan should include:

Strategic review

●

Maintain taxi service at current level

●

Continue expansion of tyre ﬁ tting service by continuing to offer unbranded low

price tyres and develop electronic wheel alignment service as an additional optional

service.

Audit of Existing HR Staff

●

Owner-manager 1

●

Taxi driver 8

●

Reception/Taxi Co-ordinator 1

●

Tyre Fitter 1

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Demand for additional staff due to change in strategy and labour turnover

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Replacement of taxi driver 2 (possibly 2 more in the summer)

●

Appointment of co-ordinator 1

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Appointment of tyre ﬁ tter 1

Action plans to reconcile gap between demand and supply

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Recruitment and selection of two taxi drivers

●

Recruitment and selection of a tyre ﬁ tter or of a person capable of training to be a

tyre ﬁ tter

●

Training of taxi drivers

●

Training of tyre ﬁ tters in use of electronic wheel alignment equipment

●

Justiﬁ cation of each aspect of the human resource plan.

It is necessary to review the strategy of the organisation because changes in strate-

gic direction usually have implications for human resources. In this case, we have an

emergent strategy that is proving very successful in that it is resulting in the rapid

expansion of a tyre ﬁ tting business. The expansion not only is affecting the tyre ﬁ t-

ting side of the operation, but is also impacting on the human resources of the organ-

isation as a whole. The owner-manager can no longer cope with the demands on his

time as a manager/operator and so it is necessary for the company to employ addi-

tional staff to cope with the co-ordination of the taxi service and reception work.

The audit of the existing staff is necessary to provide a kind of stock-take of what

the organisation already has in terms of human resources. In this case, the numbers

are small and we can work out mentally what the current human resource situation is.

The demand for additional staff is once again easy to estimate for the company

because small numbers are involved and requirements are for a limited range of skills.

The principle involved, however, is just the same as if we were looking at the addi-

tional demand for workers of many different skills working in a very large and com-

plex organisation. We need to know about any extra numbers demanded because of a

change in strategy, or some other reason for extra demand or alternatively for a con-

traction in demand. It is also necessary to take into account numbers lost through

labour turnover during the planning period, so that extra employees with the required

skills can be recruited to compensate.

When we have the ﬁ gures of existing employees, we can use these as a basis to

calculate the gap between what we have and what we need by estimating what the

expansion is, caused by the change in strategy, entails. This ﬁ gure plus an adjustment

for labour turnover will provide us with the number of employees we need to recruit.

The activities to reconcile demand with supply follow simply from our calculation.

It may, as in this case, be difﬁ cult to recruit people with speciﬁ c skills we want and so

it may be necessary to recruit unskilled people and provide them with the necessary

training (e.g. the use of wheel alignment equipment).

(b) In addition to training and development, and recruitment and selection, the com-

pany will need to ensure that other aspects of human resource management are car-

ried out so that the performance of the workforce is maximised.

Two of the most important human resource activities that are necessary in order to

ensure good performance of employees are:

1 ﬁ rst, a system of performance appraisal, so that each worker’s performance can be

evaluated

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2 second, a system of rewards and beneﬁ ts that will both compensate workers fairly and

motivate them to perform to an appropriate standard.

Performance appraisal is a systematic process of evaluating each employee’s contribution,

his or her strengths and weaknesses and ways of determining how to improve perform-

ance. Such an evaluation may provide the basis for the allocation of merit payments that

can be used to motivate workers. The information gained can also be used to move staff

either between jobs by way of promotion or even out of the company because of under-

performance. It can also be used as a means of identifying training and development needs

and it provides an opportunity to provide feedback to employees on their past and present

performance and to set targets for future performance.

The reward system is also important; ﬁ rst to compensate workers for their efforts. This

is the function of base payments. The company might also make use of incentive payments

of various kinds in order to motivate employees to work harder. Taxi drivers, for example,

might be rewarded on the basis of their overall takings per week, tyre ﬁ tters on the number

of extra services they sell, such as number of customers who are persuaded to have wheel

alignments carried out.

There are, of course, other important human resource activities that need to be covered

such as health and safety provision, which is very important when working with heavy

equipment.

Solution 4

(a) Explain how a more systematic approach to the training and development of qualiﬁ ed

staff might be adopted.

Establish responsibility for the process

In order that a systematic approach is adopted, then a process should be developed

and led by Human Resourcing. They should be accountable to ZNZ executive for the

successful delivery of training and development for this group. It is likely that ZNZ is

organised into departments or divisions and these should be involved throughout.

A more systematic approach to the training and development of qualiﬁ ed staff might

involve the following stages (or similar).

Establishing a base line

From what information is available the following is known (or can reasonably be

guessed at):

●

ZNZ invests heavily in training and development and employs a number of trainees

who are studying for their professional examinations. Dependent upon staff turnover

rates and retention of this group of employees, it is reasonable to assume that quali-

ﬁ ed staff might represent a substantial number.

●

ZNZ employs several hundred staff performing a wide variety of roles, implying that

there are a number of professional groups to be catered for.

●

The HR planning group has not indicated that the resource directed to the training

and development of qualiﬁ ed staff is too little, more that it could be more system-

atically applied. It may be that different professional groups are being dealt with in

different ways.

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As part of establishing the present position, Human Resourcing should identify the

numbers of staff involved, the professional groupings they belong to and the level of

training and development they have received to date.

Training and development: Professional requirement

Most professional bodies (including CIMA) require their members to engage in con-

tinuing professional development (CPD) in order that the currency of their members

skills and knowledge is maintained. This requirement should be readily available for

each group involved by reference to the professional bodies/the departments concerned.

Training and development: Organisational requirement

Functional plans (such as the HR plan) should be consistent with and support the

overall corporate plan or strategy. An assessment should be made of the knowledge,

skills and competencies required of the workforce in order to deliver ZNZ’s strategy

successfully. This will undoubtedly imply management and other business skills that

qualiﬁ ed staff will require.

Training and development: Personal requirement

A training needs analysis (or similar) could be conducted whereby the existing skills

and competences of an individual is mapped against the organisational and profes-

sional needs and an individual training plan developed. Similarly, training needs iden-

tiﬁ ed as part of the appraisal processes might usefully be collated. The outcome of this

process could then be discussed and agreed with departments.

Establish options for training and development provision

The next stage is to identify the most appropriate means of ﬁ lling the training and devel-

opment gaps identiﬁ ed. Attention should be given to the following main considerations:

●

Methods of feasible delivery methods (such as classroom delivery, distance learning,

on the job training, technology supported learning, etc. or some blended combina-

tion).

●

In house provision or external provision. ZNZ may already have in-place trainers

who are part of the payroll and/or specialist providers and consultants who have suc-

cessfully worked on their behalf in the past.

●

Onsite or offsite provision. There are advantages and disadvantages of each and it

may be that a mixed approach rather than either/or might be adopted. Provision

onsite would require adequate training facilities to be available to ZNZ.

●

Availability of externally provided support and courses. Rather than a bespoke provi-

sion it may be sufﬁ cient to meet some individuals needs by sending them to other

commercial providers or educational or professional establishments.

It would be a good idea to liaise with departments and professional staff when making

decisions over the options available.

Costing of options and agreement of a budget

The ﬁ nancial cost should be equated as should other resource commitments including

the number of days release required from work. These should be presented to ZNZ’s

management and approved as appropriate.

Feedback and means of measuring effectiveness of training and development

provision.

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This should include the establishment of criteria for provision and the establishment

of measures and performance indicators. With this information monitoring can take

place, and improvements brought about.

It is also important that regular structured feedback should be received from quali-

ﬁ ed staff both as individuals and as small focus groups.

(b) Evaluate the positive role the individual career coach scheme could play within ZnZ.

(You may wish to consider culture, HR initiatives, key groups and cost effectiveness

issues.)

The proposed scheme, if properly introduced and operated should be capable per-

forming a positive role within the organisation at a number of levels. Speciﬁ cally, it

should help to:

Strengthen the existing culture

ZnZ is likely to have a distinctive culture that could be further strengthened by the

proposals. The organisation may be diverse in its operations but it is distinctive due to

the fact that it is a public sector body and it has (an apparently) caring, people-orien-

tated culture. The scheme should fulﬁ l the role of reinforcing the organisation’s com-

mitment to people development and conﬁ rm in deed as well as word. The fact that it

is a genuine equal opportunity employer is evidenced by its attention to diversity, and

support for minority and disadvantaged groups through effective career coaching.

The scheme may strengthen organisational communication, positively contribute

to knowledge sharing and erode departmentalism (a commitment to ones department

rather than the organisation more widely) particularly if participants and coaches are

from different working areas. (There is no suggestion of departmentalism from the sce-

nario but this often the case in large diverse organisations).

The scheme might be viewed as an example of best practice and a demonstration of

a considerate attitude by the organisation, so reinforcing the overall culture.

Support HR initiatives

Career coaching can assist current HR initiatives and strategies in the following ways:

●

By enhance a total employment package by offered to existing and potential employ-

ees. This should make both recruitment and retention less problematic. Dedicated

individual support through career coaching might be viewed as an additional valued

part of the employment package and an incentive for those groups who may feel

alienation (the disadvantaged, the minorirty groups, those studying and under pres-

sure middle managers).

●

By offering new training and challenges for career coaches who are involved in

the process. This might lead to greater personal development, motivation and job

enrichment.

●

The scheme will certainly increase the effectiveness of ZnZ’s heavy investment in

training and development, particularly for trainees.

●

The scheme might be viewed by the organisation as a way of maintaining harmoni-

ous relationships in the workplace so avoiding damaging and confrontational indus-

trial relation tensions.

ZnZ’s future human resource plan is currently being reviewed and career coaching

should enhance future provision.

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Support key groups

The Diversity Committee has recommended that the scheme should be introduced

for minority and disadvantaged groups and the Director of Human Resourcing has

expanded the suggestion to include all trainees and those middle managers that have

been identiﬁ ed as having promotion potential. All these are key groups within the

organisation who should now feel better supported by the proposal.

In particular vulnerable groups will feel more valued and less marginalised. The

scheme should help avoid organisational discrimination (which is undesirable and pos-

sibly illegal). It should also avoid the isolation of disadvantaged groups. Trainees study-

ing for their professional examinations should feel encouraged knowing that ‘help is at

hand’. Middle managers that have been identiﬁ ed as having promotion potential are

a group who require nurturing as part of career development plan. It would be coun-

terproductive if this group were to feel isolated or disaffected and leave. Mentoring

should help them.

Organisational behaviour is shaped by the so-called ‘psychological contract’ (an

unwritten series of mutual expectations of rights, privileges, duties and obligations). It

involves a process of giving and receiving by both the organisation and the individual.

For instance the individual might expect of the organisation a decent, clean work-

ing environment, respect of the individual and recognition of contribution and

achievement, etc. In return the organisation might expect of the individual a respect

of authority, fellow workers, customers and suppliers, and a degree of loyalty, etc. The

mentoring scheme might be viewed by the individual as a way of valuing the individual

and seeking ways of overcoming difﬁ culties that make work difﬁ cult or unpleasant. As

such it should strengthen the psychological contract.

The cost advantages of the scheme

The scheme might be seen as cost effective in that it will:

●

increase the effectiveness of expenditure on professional training (hopefully fewer

trainees will fail their professional examinations)

●

potentially increase job satisfaction, motivation and feelings of commitment which

will be reﬂ ected in better job performance and hence greater productivity levels

●

support minority, disadvantaged groups, trainees and some middle managers which

will hopefully lead to less staff turnover negating the need to undertake expensive

recruitment of replacement staff.

scheme.

Recognising and overcoming negative attitudes

●

Undeniably there are potential beneﬁ ts associated with the proposals (see Part (a)).

●

There may be individuals and groups however who do not share the same enthu-

siasm shown by the Diversity Committee and the Director of Human Resourcing.

Indeed rather than displaying apathy for some there may be hostility to the scheme.

Some may be cynical about the schemes motives, others may believe that it is an exam-

ple of tokenism and more should be done for these groups.

For the uncommitted, the potential beneﬁ ts of the scheme will need to be commu-

nicated and the proposals positively ‘sold’. There will be need to respond to negative

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attitudes and real concerns with practical solutions that can be incorporated into the

schemes design.

Accommodating excluded groups

The scheme could be attacked for being elitist and selective. Currently the scheme is to

extend to:

●

minority groups (however deﬁ ned)

●

disadvantaged groups (however deﬁ ned)

●

all trainees

●

middle managers that have been identiﬁ ed as having promotion potential.

For those groups who are not offered the same facility there may be some resentment

and loss of motivation. The following groups will not be (apparently) eligible:

●

newly qualiﬁ ed professionals

●

ﬁ rst-line managers

●

senior managers

●

middle managers who have been identiﬁ ed as having no promotion potential.

For the latter group this may be very demotivating, particularly if the group are identi-

ﬁ ed for the ﬁ rst time. They may also feel stigmatised if they see their contemporaries

beneﬁ ting from career coaching.

HR will need to consider either the potential beneﬁ ts of expanding the scheme still

more widely or considering how they might best support those groups excluded by the

scheme.

Overcoming line manager/mentor tensions

Line managers of participants may feel that the process could undermine their author-

ity or position. Clear guidelines as to the extent of their duties will need to be issued to

coaches to overcome this potential difﬁ culty.

Setting up the scheme

There will be a number of practical difﬁ culties associated with the proposal initially

involving setting up the scheme and then operating and maintaining it. The scheme

will require careful investigation of best practice elsewhere, planning and communica-

tion and well as engaging a wide number of stakeholders in establishing the scheme.

Appropriate training for mentors will need to be organised, which has cost and

scheduling implications.

Running the scheme

Once operational, certain participants may be too demanding of their coaches in terms

of (possibly unreasonable) expectation, demands and time. Ways of overcoming these

difﬁ culties will need to be devised.

The scheme will not be cost neutral, as coaches will all be experienced and ‘on a

higher grade’. Their time therefore will involve an opportunity cost (as there is a need

for regular meetings). For the coach this might translate into making their working

lives more stressful and lead them to being less effective in their day-to-day working.

This issue will need to be considered by the HR.

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Other practical issues may arise from the operation of the scheme including:

●

The position of trainees. Should they also be allowed to continue being coached

once they have passed their examinations?

●

Coaches who leave the organisation or who do not fulﬁ l their obligations correctly.

Reviewing the scheme

There will be a need to review the effectiveness of the scheme after it has operated for

a while. It would be helpful therefore to establish appropriate criteria and performance

indicators before the scheme commences and these can be used as measures of effec-

tiveness as part of such a review. Such indicators of performance may be difﬁ cult to

arrive at and agree upon.

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Preparing for the

Examination