Organizational Commitment and Turnover - Assignment Example

Managing People for Competitive Advantage (JNB324) (Assignment 2) Student: D Student ID: 09542X Lecturer: Allison James Subject: Managing People for Competitive Advantage (JNB324) Course: Bachelor of Business (J3N Maritime & Logistics Management) Due Date: 14 May 2012 Word Count: 2706 (excluding background information) Abstract This paper sets out to identify and discuss how various HRM activities, functions and task are used to improve employee retention and subsequently build and sustain competitive advantage. In doing so the paper will focus on various human resources functions, tasks and activities which include but are not limited to: manpower planning, recruitment and selection, employee motivation, employee evaluation, industrial relations, provision of employee services and training and development. When all the functions, tasks and activities related to human resource manager in an organization are handled correctly and in the right manner there will be improvement in the rate of employee retention in the organization which will in turn lead to the building and sustainability of competitive advantage of the organization as compared to other companies in the same industries. Contents Abstract 1 1 Contents 2 Background information 3 Employee Retention 6 Manpower Planning 7 Recruitment and Selection 8 Employee Motivation 9 Employee Evaluation 10 Industrial Relations 11 Provision of Employee Services 11 Training and Development 12 Recommendations 13 Conclusion 13 Bibliography 15 Background information VISA global logistics is a logistics company which is located in Australia and was founded back in the year 1980s and over time it has became one of the largest as well as privately owned global freight forwarding company in Australia and also in New Zealand. VISA global logistics company offers a diverse range of services that consists of aspects such as warehousing, forwarding, distribution, clearance and value added services by the use of the firms own resources and the company does not depend on any third parties so as to offer its services. The company also offers international shipping’s to various destinations in the world. The company was operating under the company name VISA Australia Pty Ltd until 1st February 2011 when it changed its name to VISA global logistics. The company has a total of forty two employees. The table below shows the organizational structure of VISA global logistics which start with the employees at the administrative level and these employees are followed by employees at the research and development level, the other category of the employees is executive leadership and the last group is the employees at the sales and marketing department. Human Resource Functions, Tasks and Activities HRM functions consist of various activities and other tasks that a human resource manager in an organization is tasked with. One major function or task among them is the staffing of the organization and also the decision on the types of employees to use in the organization. In relation to staffing organization must make a choice on the kind or type of employees to use. A company may either opt on using contractors or hiring permanent employees based on the needs of that specific organization. Various other human resource functions exist and they include: recruitment and training, performance measures, making certain that are performing their duties in accordance to the expectations and also making sure that the staff members adhere to the set personnel and management practices within the organization (Beer 1997, p. 53). Employee retention is vital aspect in most organizational since when employees leaves an organization they take with them vital investments for the company, relationships and the intellectual property. Therefore Organizations ought to put into practice strategies to make certain that there is effective employee communication that will ultimately improve employee commitment to the organization and improve personnel support for key business ideas (Brown 1996, p. 240). This will in turn lead to the building and sustainability of competitive advantage of the company. HRM tasks, activities and function are progressively been viewed as to add to the productivity, superiority and other organizational goals through attracting and sustaining of organizational actions. Through their proper use an organization is able to retain their employees and at the same time build and sustain a competitive advantage. Employee Retention Traditional managers and other employees at the administrative levels have individuals neglected the importance of how employee in an organization are managed and developed at the workplace and this traditionally this aspect was seen a waste of the company resources. Though over time the managers have now realized the important role played this aspect in the management and development of employees at the work place and it has been discovered that for an organization to achieve the required level of improvement in terms of performance employees ought to be managed and developed (BQF 1998,p. 6). This is evidently mirrored by the use of various idioms that organizations uses such as some organizations may say that employees in the organization are the most vital assets (Accenture 2001, p. 4). it is highly accredited a similar characteristic that is shared by most successful organizations is that they tend to value and invest more on their employees (Anand 1997, p. 63). Consequently human resource management perceived as a way for the organization attaining competitive advantage (Delery & Doty 1996, p. 815). Dependable to this viewpoint is an evenly vital issue for organizations, which is the retention of employees. A large number of companies operating in the modern day business world are struggling with retaining of core employees since most of them rely greatly on increments of salary and bonuses alone as a way of preventing employees from leaving (Accenture 2001). Basically more and more organizations are currently upholding employee retention as a strategic issue to the organization and also as a source of competitive advantage (Walker 2001). The HRM tasks activities and functions play an important role in the employee retention. Each of the aspects is clearly discussed below and how it contributes to employee retention at Visa global logistics which will hence build the sustainability and act as a source of competitive advantage for the company in relation to other logistics companies. Manpower Planning Manpower planning in an organization encompasses the evaluation of organizations present and future needs and this is later compared to the current resources and predicted resources for the organization. The organization ought to ensure that there is a balance between demands and supply (Fitz-enz 1990, p. 27). VISA global Logistics Company should aim at avoiding both overstaffing and understaffing since both aspects have their own weaknesses which do not act in the favor of the organization. Understaffing in the organization leads to loss of economies of scale in the business while overstaffing on the other hand leads to waste of company’s resources and at times it tends to be expensive if sustained for a long period of time (Zeffane 1994, p. 30). Visa global logistics need to assess and determine the kinds of employees to use in the organization that is whether casual or permanent employees. This is because the permanent and core employees in an organization offer flexibility within the organization and at the same time their valuable skills can be easily moved to other areas within the organization if change arises. The company is supposed to use temporary kind of employment since they are all-around and cross trained and they will make possible for a speedy and even employment of employees. With good manpower planning Visa global logistics Company will have a high employee retention rate which will contribute to the building of a competitive advantage for the company over the other companies in the same industry. Recruitment and Selection This is another important function of the HR and it plays a pivotal role in enhancing the success of an organization. The parameters and procedures used in the recruitment and selection of employees have undergone radical alterations, at the same time organizations objectives have became more multidimensional, and the organizational business environment continuously present new challenges (Withers 2001, p. 40). In this current business environment and with the increase of practices like poaching, the HR manager tasks, functions and activities have become more complex since the HR is more apprehensive in employing the best talent with the skills that are appropriate to the organizations needs (Cohen 1993, p. 1150). Recruitment and selection as a HRM functions is a vital role of almost all HRs in different organizations and they are tasked with the duties that underlie human resources management and they include: the acquiring, rewarding and development of employees. Recruitment and selection forms a vital aspect of the duty of a human resource manager. Nevertheless, and prominently, recruitment and selection results that are made by line managers. The HR at Visa global logistics company needs to apply the right measures and standards when recruiting and selecting new employees. With the application of the correct procedures the company will be able to get the best choices and qualities in the employees chosen this will in one way lead to the employees staying more in the organization since they possess the required skills. This will enable the organization have a competitive advantage since they will not be recruiting and selecting employees time and again. Employee Motivation Organization aim at retaining their best staff and at the same time encourages the employees to provide their best when working and thus employee motivation call for both financial and psychological rewards. Motivation is commonly used as a tool to join and hold the talented lot of employees in the organization and with motivation the employees tend to perform better, organization therefore should focus on continuous motivation of the employees in order to gain success and have a better competitive advantage (Hunt & Morgan 1994, p.1570). Employee motivation is mainly done in form of rewards and for those employees who have performed well. The HR department at Visa global logistics need for monitor the performance of the employees and those who have exceeded expectations should be compensated for their actions. Those who have performed below expectation ought to be motivated to enable them to perform in accordance with the expectations of the company. It is widely believed that by rewarding employees with exceptional performance, the employees will be motivated thus been loyal to the organization (Williams 1999, p. 80). Motivation of employees is a vital aspect in the sustainace of the business and it also builds a close connection between the employees and the organization this in one way creates a sense of loyalty in the employees (Handy 1999, p. 45). The rewards that Visa logistics can apply so as to retain their employees is by increasing the salaries of the employees, offering flexible working hours, giving the employees end of year benefits and also the giving them holiday offers. Therefore Visa logistics should reward their employees for them to achieve high retention rate. Employee Evaluation Organizations should aim at enhancing continuous employee evaluation since it plays a major role in the retention of employees. An organization should constantly monitor the workforce in the organization and monitor the performance of the employees as well as the organization performance (Lee et al. 1992, p. 20) With continuous employee evaluation there will be an improved level of organizational performance and the manager will be able to find potential employees to fill vacant position in the organization and also in offering a reasonable method that in essence connects the payment of an individual to his/her performance (McGovern 1995, p.50). With increments in pay and with promotions of employees, the employees within the organization tend to more committed to the organization and there is a reduction of instance of employee turnover within the organization since the employees are more committed thus high retention rate in the organization. Also employees tend to feel more comfortable when working in high performing organizations hence this will contribute to a high retention rate for the company (Eskildesn & Nussler 2000, p. 585). Therefore Visa global logistics need to have a continuous evaluation of their employees so as to keep the organization at a competitive advantage as compared to other companies. The HR should have a manageable number of employees within the organization and the employees need to be assessed from time to time so as to identify the best performers and the non performers. By the use of continuous evaluation the human resource managers will able to select the best employees out of the applicants so as to fill higher positions in the organization. Also through the continuous assessment the employees will know their weak areas and will try to change for the own good and for the organizations benefit. With the continuous evaluation of the employees in the organization the Visa logistics company will be able to retain more of its employees this will ultimately lead to the company having a competitive advantage over other companies they are operating or competing with. Industrial Relations Most organizations find it hard to describe good industrial relations since they fail to distinguish and describe a justifiable purpose for the organization this is so since industrial relations is comprised of creating complex relationships between the, employers, the government, and legislation, government agencies and workers (Dyer & Reeves 1995,p.666). Visa global logistics company should have adequate industrial relations in the organization. This will ensure clear and concise flow of work in Visa global logistics company. A company with no effective industrial relations cannot achieve a competitive advantage over the other companies since industrial relations are impracticable to realize if there is no collaboration of labors and harmonious relations. Provision of Employee Services Most organization are more concerned with both the mental and psychical fitness of their workforce and they generally do this as a way of retaining good staff member and attracting other new ones (Dessler 1999, p.50). Visa global logistics can apply various forms of activities which include but are not limited to schemes for occupational sick pay, and activities such as support for sports and social activities and provision of financial. It has been noted that companies which offer such services have higher levels of employee retention as compared to other companies who do not have such services. Thus the company should offer such services to its employees. With the offering of the various kinds of services to the organization employees there will be a high retention rate. Training and Development Despite the various functions, tasks and activities of the human resource manager in any organization all of them have a part to play in the enhancement of the organization. Training and development are evenly significant HR functions (Miceli & Mulvey 2000, p. 80). Training and development were viewed as a waste of organizations resources but with the dramatic change in the business world they are now viewed as investments for the company. So as to increase commitment among the employees in the organization and also enhance the provision of quality products and services most managers are now seeing the important role played by training and they are advocating for it (Davies 2001, p. 30). Most organizations are using training and development to improve their employee’s skills and the overall performance of the organization. Thus training and development plays a major role in ensuring that there is a balance between two major management goals that is the role of keeping employee’s happy and productive at all times and also exploiting company efficiency. With more happy and satisfied employees who are productive, the company will have a competitive advantage and the employees will tend to stay in the organization more. When employees are trained they will turn to perfume their duties in a more efficient manner and this will ultimately lead to efficiency within the organization. Thus the employees will tend to stay more in the organization compared to other employees who are not trained n how to perfume their duties. Employees in most cases tend to move to organization where they are able to work better based on the training and development offered (Walker 2001, p. 9). Most companies gain a competitive advantage over the other companies through training and development. Performance deficiencies in an organization are eradicated by the use of training and development thus making the employees more efficient in performing their duties thus they will be very reluctant to leave the organization since they are able to perform the required tasks and duties in the organization. Visa Logistics Company should ensure that they have a planned and continuous training and development of their employees. With these the company will be able to retain their employees and with retention of the employees the organization will be able to build and sustain a competitive advantage (Buchanan 1975, p.30). Recommendations Visa global logistics should therefore apply certain measures in the aim of reducing staff turnover hence a high level of employee retention. The logistic company ought to implement a team based management style this will in one way lead to greater employee participation. Another recommendation is that the company ought to improve selection and recruitment process this will ensure that the organization have the employees with the skills required to perform their duties in the organization. Also the company need to ensure that their is a continuous career development support for all the employee this will in one way increase the employee retention rate in the organization. Conclusion In conclusion, HRM perform various tasks, activities and functions in an organization which when performed in the right manner they lead to high levels of employee retention in the organization and how employee retention leads to the building and sustainability of the company’s competitive advantage in the company. Through the proper application of the various HRM activities, tasks and duties in visa global logistics the company will be in a better position in retaining their employees. Visa global logistics will be bale to sustain a competitive advantage in the market place this is also evident in that the company now has global contacts and destinations. Bibliography Accenture, 2001, ‘The high performance workforce: separating the digital economy winners from losers’, The battle for retention Accenture’s study pp. 1-5. Anand, K. 1997, ‘Give success a chance’, Journal of Quality progress, pp. 63-64 Beer, M. 1997, ‘The transformation of human resource functions: resolving the tension between a traditional administrative and a new strategic role’, Human resource management journal, vol. 36, no. 1, pp 49-56. British Quality Foundation 1998, ‘The X factor-winning performance through business excellence’, British quality foundation journal, pp. 5-7. Brown, R. 1996, ‘Organizational commitment: clarifying the concept and simplifying the existing constrict typology’, Journal of vocational behavior, Vol. 49, pp. 230-251. 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