Organisation and People Management - Essay Example

Organisation and People Management Name Course Name and Code Instructor’s Name Date Abstract According to Boxall and Purcell (2011), organization’s people management practices should be embedded in a firm’s socio-political and economic environment and its business strategy. Strategic business management is a human resource practice faced with both intellectual and political challenges. The manner in which organizations manage their strategic management process depends on how successful they manage their managers. Using secondary data from Emirates Airline this paper seeks to analyse how business strategies affect HR management. Following the analysis the following HR implications need to be addressed: Recruitment, training, retention, and motivation. This paper is limited only to the secondary data used to analyse the company. However, a comprehensive understanding will be obtained by using primary data for further investigation of Emirates Airline. Introduction The success and sustainability of any organization primarily depend on the environment in which the business is situated. Business environments include social, political and economic. Economic environment entails the economic factors that influence the business organizations and their operations (Wirtz, Heracleous & Pangarkar, 2008). These factors may include economic conditions, economic policies, and economic systems. Social environment of the business comprise of social factor like customs, traditions, poverty, literacy, life expectancy rate, values and beliefs that affect the business organization (Boxall & Purcell, 2011). Political environment on the other hand includes political systems, the government policies, and the attitude towards the business community. This paper seeks analyse the environmental factors affecting strategic management of Emirates Airline human resources. Secondly, the paper will briefly describe the company’s competitive strategy. In addition, this paper will identify and explain the key HR challenges faced by Emirates Airline with regard to its competitive strategy. Strategic business management is a human resource practice faced with both intellectual and political challenges (Wirtz, Heracleous & Pangarkar, 2008). The way organizations manage their strategic management process depends on how effective they manage their managers (Boxall & Purcell, 2011). In order to understand key environmental factors affecting strategic management of Emirates Airline human resources both internal and external environment will be discussed. Internal Environment The Company’s SWOT analysis is essential in describing the internal environment in relation to HRM management. Strengths The company has a big capital base; this has made it possible for company to recruit, train, employee, reward, and maintain highly qualified personnel (Wirtz, Heracleous & Pangarkar, 2008). Job vacancies at Emirate are lucrative and ones employed at the firm it is hard for one to leave because of the high pay package. The company provides high quality services; this has been made possible by the company’s recruitment process. The company has a large capital together with its strategic positioning it has attracted skilled and talented employees that provide exclusive services to customers and other stakeholders (Horth & Alwyn, 2005). The company emphasizes innovation; this is a true confirmation of the availability of skilled personnel who are empowered to make autonomous decisions with regard to improving company’s viability and sustainability in the long run. The firm provides its services to global market; this has opened a window for the company to recruit employees from a wide pool of professional across the globe (Bosilie, 2010). In addition, the firm encourages cultural diversity among its employees by employing its crew from over 100 countries around the world. The staffs of the firm are kept professional, young and attractive to portray youthful image. This image has continued to attract young, qualified and skilled professional the world over to desire working for the company. This has culminated into the firm maintaining superb and classy service delivery to its customers (Bosilie, 2010). Weaknesses Emirates Airline not cater for middle class and budget travellers; this narrowed the chances of the company staying in the market as it has cut off a substantial number of potential customers (Wirtz, Heracleous & Pangarkar, 2008). The implication on HRM is that they are forced to employ a limited number of employees (Bosilie, 2010). Opportunities To develop continuously new generations of more advanced airline and aviation services; this will streamline employee’s behaviour hence focusing on delivering high quality aviation services. It will also mould the firm’s operational culture (Wirtz, Heracleous & Pangarkar, 2008). Threats Rising fuel cost is critical to the overall returns of the company. High fuel prices have direct impact on the cost of operation, which automatically results into retrenchment of employees in order to maintain company’s profitability. External Environment PEST analysis will be used to describe the firm’s external environment Political Aspects The physical location of Emirates Airline is less turbulent politically, economically and socially. The political environments within the Asian Pacific countries are favour business sustainability and expansion; these countries signed trade agreements amongst themselves to facilitate business operations particularly in the Aviation sector. In addition, European countries, the US and even African countries have also encouraged the growth of the airline by providing conducive political environment thus helping the airline open up to the rest of the world. The peaceful political environment has enabled the Airline to recruit skilled employees across the world (Horth & Alwyn, 2005). Economical aspects The United Arab Emirates region has an economic environment suitable for nurturing its economy. For instance, the per capita income in UAE countries is significantly high and hence it has made it possible for many people to afford using Air transport. The economic policies within the UAE are being streamlined to suit the airline industry (Wirtz, Heracleous & Pangarkar, 2008). The calm and encouraging economic environment has ensured future viability of the business. The HR department is therefore confident to recruit, train, employ, and maintain highly qualified personnel for quite a long period of time (Horth & Alwyn, 2005). Social aspects The airline is fortunate to operate in a region where there is labour abundance and most workers rarely demand high remunerations. It has been established that in the UAE only eight percent of operating cost is used to pay workers. With the ever changing world, labour issues are affecting employers and Emirates Airline is no exemption (Zheng, 2009). Employees are constantly realizing their potentials by especially comparing their pay with what other airline industries offer and now they are demanding for more. In most cases you will find different aircrafts are operated by different types of pilots and engineers who belong to dissimilar workers union. The HR department find it had and difficult to prepare payment schedules for their employees given the fact that some workers operate instable economies (Horth & Alwyn, 2005) Technological aspects In the advent of IT and the internet influenced how the Emirates Airline has operated over the past years. Across the world there is no any business that can operate globally without embracing the use of IT and IS systems. Emirates Airline reach its customers around the world via the internet and hence it knows the latest trends in the global business (Zheng, 2009). The HR department on the other hand is using technology to advertise, recruit and employ qualified personnel. Consequently, technology has been used to a great extent in improve the efficiency of its production and operations (Horth & Alwyn, 2005). Legal aspects Most governments within the Asian Pacific over the past years used to operate under a paternal government where they protected their airlines against external factors. This has long been changed and Airline industries are now open to competition, which has considerably helped Emirate to grow and expand at a high rate (Zheng, 2009). Rules of economics have been allowed to sustain the competitive advantage rather than worrying about government obstruction. The HR department at the Emirates is now able to employ its own personnel without the government interference (Horth & Alwyn, 2005). Strategies: According to Zheng et, al (2000) sustaining organizations competitive advantage is challenging; firm’s specific advantages are temporary in nature due to internal and external factors. These factors are responsible for competence-destruction and causing discontinuities in many firms across the globe (Wirtz, Heracleous & Pangarkar, 2008). Furthermore, Fields, et al, (2000) observed that revolutionary new business models, disruptive technologies, fast diffusing and access to information together with increased emphasis on growth based on innovation versus maintaining margins and stability has completely changed the way of doing business. Based on these key issues, firms are called upon to come up with business strategies that are viable and which seek out sustained advantages. Around the globe, firms are adjusting to business strategies that will sustain and enhance their competitive advantage in the market and Emirate Airline is never an exemption. With regard to this, the company’s corporate strategy and the entire business management illustrate the process of directing business activities by maximizing the use of the available resources to achieve its objectives (Zheng, 2009). The airline has been in operation for approximately twenty three years. It has gained a global position and in fact it is one of the most reputable Airline companies (Fields, et al, 2000). The company is also one of the five airline industries that operate in the wide-body feel. The company has gained competitive position and advantage in the market place due to its favourable marketing and business strategies. The airline leadership is one of the most influential and essential in the world; they are the ones who have made everything possible for the industry (Strategic Management Society, 2008). The Emirates Airline is always on the forefront in the aviation industry. With this strategy the company has managed to survive in the market regardless of turbulent market environment. The leadership of the firm has always and still is on the lead encouraging innovation and championing excellence (Strategic Management Society, 2008). Furthermore, recruitment and training is one of the key strategies that the firm has adapted to equip the company with skilled employees. The company’s corporate strategy encourages diversity especially by flying to numerous destinations across the globe, it has made it possible for the firm to recruit employees globally. Diversified management approach of the company has ensured that clients receive salient services by passionate employees. Employees are recruited from a global perspective (Bamberg, et al. 2005). The company commitment to providing their customers with sage, dependable and personal transportation to their esteemed clients together with other relevant industrial services calls for highly motivated qualified and motivated employees. The company employee rewarding strategy is one of the most excellent in the world (Zheng, 2009). The company is dedicated and committed to make each flight a memorable and outstanding to every passenger (Moncarz, Zhao, & Kay, 2009). Safety, convenience, and comfort are the company’s most essential concerns as they deliver worth services to their clients (Wirtz, Heracleous & Pangarkar, 2008). According to Bamberg, et al. (2005), the airline has also adopted a focus-leadership strategy, which has positioned it as a leader in the aviation industry. The marketing approach of the firm is customer-oriented approach. For instance, the management has implemented routes to different destination across the globe in order to cater for the ever increasing customer demands. This strategy has ensured employees’ loyalty and commitment with regard to supporting the organization operations (Becker & Gerhart, 2003). Nevertheless, the strategy has helped the Emirates Airline to outperform other airline industries. For example, through the strategy, they have gained market share and improved the general demand for air travel among their clients. Competitive Strategy Emirates Airline competitive strategies are readily provided for by the environment within which the company operates and the product of intrinsic thinking from within the currier. For example, aviation industry in the Middle East is a low entry barrier industry. Given that, finance capital is easily available and technology and expertise are purchasable in Middle East (Piaza, 2005). The power of suppliers: Boeing and Airbus are the two main aircraft suppliers, competition amongst them is affordable, and the likelihood of the supplier to integrate prices vertically is unlikely. The power of buyers: the bargaining power of airline industry buyers in the Middle East is low. For instance, the ability of customers to pressure the firm and affect customer sensitivity to price changes is low. Availability of substitutes: substitute Airline services in the Middle East is limited given the distance and the fast pace at which Emirates is becoming a symbol of the area. The Airline is strategically located (Piaza, 2005) HR Challenges facing Emirates Airline Airline industries in the global market has strong competition, with regard to this Emirates Airline faces a challenge of maintaining its global competitive advantage given the fact that it comes from a geographical location where there is limited airline competition (Wilson, 2005). Secondly, the company’s home rather regional customers have poor or low bargaining power; from a global perspective, the company faces a challenge of setting favourable global travel prices. Lastly, expertise easily available and purchasable in the Middle East: for the company to operate globally it requires global employees who will attend to customers from different destinations. With regard to this, the company faces the challenge of employing employees from different countries who may demand high rates (Wilson, 2005). Conclusion Good business strategies are essential for sustaining the success of any business organization. Corporate strategies that encourage the HR department to recruit, train, retain and motivate employees are critical in managing the human resource in any business organization. Emirates Airline has good business strategies, which have ensured its sustained advantage, the ultimate success and the continued diversification of the company. The socio-political and economical environment has favoured the company to operate even in turbulent global economic environment. References Bamberger P.A, Erev I., & Oref-Chen T. (2005) Group & Organization Management: Peer Assessment, Individual Performance, and Contribution to Group Processes: The Impact of Rater Anonymity. New York: Sage Publishers Becker, B. and Gerhart, B. (2003). The impact of human resource management on organizational performance' Academy of Management Journal, 39 (4), 779–801 Boselie, P. (2010). Strategic human resource management: A balanced approach. Berkshire, UK: McGraw Hill Higher Education Boxall, P., & Purcell, J. (2011). Strategy and Human Resource Management, 3rd edition, Palgrave Macmillan, UK. Fields, D., Chan, A., & Akhtar, S. (2000). Organizational Context and Human Resource Horth, D., and Alwyn, T (2005). The next low-cost threat. What does Emirates mean for Europe?, UBS Investment Research QSeries, Retrieved from http://www.airneth.nl/serve_file.php?dType=dDocument&id=157 Management Strategy: A Structural Equation Analysis of Hong Kong Firms International. Journal of Human Resource Management, 11(2), 264-277 Moncarz, E., Zhao, J., & Kay, C. (2009). An exploratory study of US lodging properties' organizational practices on employee turnover and retention. International Journal of Contemporary Hospitality Management, 21(4), 437 - 458 Piaza A.J. (2005). Economic and Industrial Democracy: Globalizing Quiescence: Globalization, Union Density and Strikes in 15 Industrialized Countries. London Sage Publishers Resource Management, 3(3), 376-408 Wilson, G. (2005). Emirates: The Airline of the Future, London and Dubai. London: Oxford University Press. Wirtz, J., Heracleous, L., & Pangarkar, N. (2008). Managing human resources for service excellence and cost effectiveness at Singapore Airlines. Managing Service Quality, 18(1), 4 – 19 Zheng, C. (2009). Keeping talents for advancing service firms in Asia. Journal of Service Management, 20(5), 482 – 502 Read More