Human Resource Management- Employment Relations - Case Study Example

Running Head: Case Study on Aqua and EasyBottle Your name Course name Professors’ name Date Introduction This paper presents a detailed investigation of Aqua and EasyBottle in terms of management styles of employee relations. The first task is to analyse employee relations management styles as discussed by Purcell and Sisson then proceed to show the ones displayed at Aqua and EasyBottle. This will require the use of research evidence to support the argument. Concisely, Aqua and EasyBottle assume pluralist and unitarist ideologies respectively. This part will be succeeded by recommendation to senior management team on key employment issues that must be addressed in the short run and long run for achieving an integrated employee relations strategy. Some of these identified employment issues include power, integration of management roles, training, employee involvement, and communication, and unionization. The last part of the essay is a detailed discussion on the impact of recommendation made to the management. Included in the impact is implementation issues and pressure that accompanies the recommendations made. Employee Relations Management Styles defined In a research conducted by Purcell and Sisson (1983), employee relations management styles fall under five classes namely: authoritarian, paternalistic, consultative, constitutional, and opportunist. Under authoritarian approach, Purcell and Sisson argue that employee relations are insignificant. In the same note, the researchers argue that existence of policies and procedures for grievances and disciplinary measures follows legislative requirements hence is a matter of necessity. This means that people’s issues are not given any attention until something goes amiss i.e. worker dismissal. An illustrative example is an employer who goes ahead to dismiss a worker who made a mistake simply because warnings were not given or rather disciplinary procedures were not clarified. In paternalistic style, Purcell and Sisson are convinced that its characteristics are similar to authoritarian style but have a positive attitude towards employees. Managers following a paternalistic style prides in consulting with employees irrespective of existence of unions. The focal point for this employee management style is staff retention and reward. The constitutional style postulated by Purcell and Sisson assumes that trade unions exist. Management style is more adversarial as opposed to consultative. Nonetheless, the constitutional style shares characteristics with other styles. While describing opportunist style, Purcell reiterates that local circumstances determine how workforce relations are managed. From the definitions above, Purcell concluded that management style simply points to the presence of distinct guiding principles either written or unwritten that outlines how workforce is treated or how a specific event is handled. Employee management styles evident in EasyBottle and Aqua Autocratic style of management is evident in EasyBottle. The style is under unitarist view where management have the right to make decision by instituting strict control and discipline in addition to showing aggression towards unions. Managers make all decisions whilst employees are expected to execute them without questioning or challenging the orders. This style of managing employee relations uses punishment and reward system to motivate employees. The pending court case, which followed worker dismissal, shows how punitive measures such as dismissal were used in EasyBottle. Bearing in mind that management through autocratic style lacks two-way communication; leaders pursuing this style fail to invest any trust in their employees (Gennard, 2005). Apparently, EasyBottle does not have any mechanism to engage or communicate with employees. Moreover, the company concentrates on its own objects and disregards development needs of employees. In fact, EasyBottle have no training or formal employee involvement aside from the few health and safety manuals. This can be contrasted with paternalistic style in Aqua, which has employee welfare at heart. A situation where unionisation was discouraged is a clear indicator of autocratic style of management. It is alluded to in the essay that the managing director at EasyBottle unilaterally sets wage increases without any consultation with employees thus acting as a pointer of autocratic style of management. Management at EasyBottle further displays opportunistic characteristics where trade unions are barred simply because they are viewed as interfering with management privileges and so will not allow the concept of unionisation. The former Managing director at EasyBottle actively discouraged formation of unions, a fact that he communicated to new employees. At the same time, opportunistic style is featured by minimal investment in employee. In the same vein, employees at EasyBottle are not subjected to any kind of training or employee participation and empowerment. Contrary to unitarism that exists in EasyBottle, Aqua can be classified under pluralist view. Pluralist accepts presence of unions that fights for worker rights. The ideology is that an organization is made up of different sections and groups. Even though these sections and groups might share some interests and objectives, they also can vary. A study of Aqua shows that active trade unions are upheld. These unions frequently meet with senior managers at the company to address issues affecting all grades of employees. In terms of power, management provides the way and followers have the liberty to challenge or question management’s leadership. Power under pluralist is further compared with fluid hence the ability to change dominance at any time. Through its employee involvement techniques such as meetings, attitude survey, and appraisal, employees are able to place their views and criticism consequently checking management dominance. Pluralists are convinced that conflicts are inherent, unavoidable, and health. Ultimately, strike, which is a form of industrial action, expresses conflict in a legitimate manner. To settle disputes, pluralist believes that rules, art of negotiation, and collective bargaining should be deployed. Characteristics of “Sophisticated human relation” are observable within Aqua. Proponents of this theory have a conviction that workers are organisational assets hence management should move towards identifying employees with the company aims. Policies propounded by sophisticated HRM tend to remove the need for opposition by the employees given that managers care about the employees as opposed to outcomes and profits. Paternalistic style, a part of sophisticated HRM, places employees at the centre of the organization. This is noticeable in Aqua, which has invested in its employees by offering continuous certificated training specifically in the use of new technology. Besides, sensitivity to employee welfare and development is evidenced by recent internal supervisory management training course introduced to guide employees through their career path. Introduction of a reward scheme for a successful achievement of targets and existence of contributory pension scheme for all employees clearly demonstrates Aqua’s commitment to employee happiness and motivation. There is no doubt therefore that Aqua sees its employees as valuable assets contrary to EasyBottle that perceives employees as disposable factors in a production chain. In some instance, Aqua display consultative style of managing employee relations. This style is less formal and more flexible in approaching employee relations. Unions are recognised and encouraged to participate in decision-making and solving problems in a company. Aqua recognises the value of trade unions and often meets with senior managers to discuss pertinent issues facing employees. Union participation in Aqua is manifest when it agreed on a 10% wage premium based on target achievement after negotiating with line managers. Recommendations for an integrated strategy The first employment relations issue that should be addressed by management is recognition of both vertical and horizontal integrative strategies that would have the effect of developing long-term brand of the company. This means that an approach to employee relations ought to be multi-dimensional in nature since some variables aids in achieving long-term goals of a company. Ability to merge short-run horizontal and vertical integrative strategies would have the long-term effect of building the company’s brand. A good example is employee involvement, which is part of horizontal integration. This is a short-term strategic option where employees are empowered through training, open communication channels, and formal involvement. In EasyBottle, employees are not empowered in any way divergent to Aqua where employees are trained, allowed to hold regular meetings, and get a chance to air their grievances. Even though the managers might feel that their roles have been usurped by giving employees too much say in company activities, it is appropriate to consider a way to satisfy both parties. The ability to establish a common ground for both companies would have the long run effect of satisfaction and eventual achievement of company goals. The act of putting too much power on a single or few positions affects daily operation of a company. Warehouse manager at EasyBottle is responsible for employment relations. A small team of advisors appointed to look into payroll administration and to manage sickness absence limits participation of other employees in the short-term basis and in the long-run slow down implementation of policies. If employees were empowered to contribute to policy formulation, implementation of such policies would be fast. Communication eliminates misunderstanding and eases implementation of policies. Communication should be both horizontal and vertical. In a move to formulate an integrated employee relations strategy, the management is obliged to consider how to make communication effective in the short-run. Communication takes place daily in an organization thus calling for its effectiveness i.e. developing a robust information management system for long-term usage in an organization. Businesses in the present world are capitalising on internet as a tool to execute business engagements. Most customers place their orders online and receive deliveries within a few days. While formulating an integrated employee relations strategy, it is necessary to make communication effective through MIS. Unions are avenues for employees to air their grievances and should be addressed in the short-run if an organization is looking forward to a stable company in the future. EasyBottle and Aqua are not at congruence in relation to unionization. Employees at EasyBottle tend to be passive and execute what management have planned without challenging or questioning them. Conversely, Aqua supports formation of trade unions that meet with management to discuss issues that affect employees. An integrated approach to employee relation must therefore look into how unions can be enhanced to respond to company and employee needs. The other factor that must be considered by top management in its bid for an integrated employee relation strategy is the possibility for vertical integration. Through vertical integration, there is a tendency for pay equalisation and training on management issues. It is important to note that EasyBottle did not allow employees to participate in wage increase negotiations or any other management issues. The managing director unilaterally determined wages without consulting. On the other hand, Aqua has a sophisticated HR team that manages activities to do with employee benefits. The performance award scheme developed at Aqua made it possible for employees to earn an additional 10% in the event that sales targets are met. In the end, employees are motivated and remain productive. The subject of equalising pay should therefore be considered by management when formulating an integrated strategy. Impact of the recommendations The first identifiable impact of the recommendations above stems from the issue of power. It will be difficult for autocratic managers from EasyBottle to assume a new system of governance where power is shared. In Aqua, management is participatory whist employees are free to challenge decisions made by the seniors. After the takeover, it is observed that former managing director of EasyBottle discouraged unionisation by making it clear to prospective employees that unions were disallowable. This shows how the director attempts to make decisions by his own without consulting with other stakeholders. Implementation of an integrated employee relations strategy may therefore be hampered by the concept of power. To counter this problem, re-training of managers is an effective tool to be used. This training will cover on new management styles and the need for a change. EasyBottle has a deeply rooted culture and this is affirmed by situation where former managing director at EasyBottle discourages unionisation even after the takeover by Aqua. The possible impact is confusion and tension amongst original Aqua employees who had been allowed to join trade unions. To deal with this problem, psychological change is necessary. Workshops and mentorship programs will assist employees adapt to the new ways of doing things. This is a short-term strategy and goes a long way to change the perception of employees. Owing to the fact that business takeover is a form of change, ways of conducting business often change and requires subsequent training of not only managers but also staff members. In EasyBottle, employees were passive and played a single role of executing policies and proposals laid down by top managers. Most communication avenues were closed hence minimal interactions both vertically and horizontally. A recommendation to open up horizontal communication channels after the takeover has the effect of enhancing interpersonal relationships, gaining compliance, and improving understanding. Interpersonal relationships amongst employees at EasyBottle are poor simply because of undefined horizontal communication. Integration of employee relationships by opening up horizontal communication culminates to good worker relationships. Employees are always in need of companions and colleagues they can talk to both formally and information. To gain compliance, communication is indispensible. Managers who want their employees to comply must always communicate effectively. Lastly, communication leads to understanding. For an employee to be well versed with work environment, communication must be developed. After acquisition of EasyBottle Company, employees in the new integrated company must gain knowledge of the new environment and this is made possible through communication. Unionization has the impact of improving worker benefits. This is supported by union bargaining power and union voice. Wage premium obtained after negotiation with employers is the impact of union voice. Consequently, there might not be harmony. Nonetheless, stable and constructive employment relationships are developed. Often, unions concentrate on sides where workers have more problems. By raising awareness of the problems and attempting to rectify them by negotiating with management tends to increase information flow to employees. The effect is a heightened awareness of employer inadequacy and more criticism thus raising awareness. In a literature by Hirschman (1970), union’s voice further motivates employees to handle problems faced at work as opposed to quitting when faced with dissatisfaction. The employer benefits from this impact of worker voice by reducing costs associate with recruitment and training. This is true given that workers opt to fight for their rights while working as opposed to quitting. In line with this discussion, Freeman (1984) demonstrated extended job tenure in an environment with unions. Freeman went ahead to address improved performance within an environment where employers are supportive unions. Conclusion This paper began by discussing five different styles of managing employee relations. These styles were then applied in analysing the case of EasyBottle and Aqua companies limited. Recommendations covering on employment relations issues, both long term and short term, were covered. These recommendations were based on the need for an integrated employee relations strategy. Lastly, the paper elaborated on the possible impact of recommendations and issues that may arise during implementation. One of the likely impacts of recommendations is unwillingness by managers to share power. Additionally, the essay scrutinized how unionisation benefits both the employer and employee. Reference List Freeman, R. and Medoff, J., 1984. What Do Unions Do? New York: Basic Books. Gennard, J., and Graham, J., 2005. Employee relations. London: CIPD Publishing. Hirschman, A., 1970. Exit, Voice and Loyalty: Responses to Decline in Firms, Organizations and States. Cambridge, MA: Harvard University Press. Purcell, J. and Sisson, K., 1983. Strategies and practice in the management of industrial relations. In Bain, G. Ed. 2005. Industrial Relations in Britain, Oxford: Blackwell. Read More