The Importance of Incentives and Rewarding Employees - Assignment Example

Topic: Operation Management "Take Home Exam" Name: ID no: Unit code and name: Lecturer name: Assignment No: Due Date: Human resource management The human resource department is a pillar operational concept in any business. The department deals with the recruitment of the employees, their welfare in the organization, remuneration and termination of their employment. In the organization, the human resource carries out the task of employees’ development through training and promotions. One of the main functions of this department is employees’ motivation and dedication in the company (Sullivan, 2000). This is done through offering of incentives, pay increase and promotions. The human resource management is categorized into management and operational functions sections. These two sections form the most important aspects of human resource management in today’s working environment. The managerial part of human resource department deals with planning, staffing, organizing, controlling and giving instructions. Operative functions of the human resource department involve procurement, compensating employees, career development, motivation of employees and maintenance (Che Rose & Kumar 2007). Service industry In service industry, human resource department acts as the major player in running of the business. Hotel industry is one of the main areas where the concept of human resource can be applied. This is due to the importance attached to this department by the companies’ employees. The human resource department acts as the face of the company where workers can take their grievances as well as welfare. To manage employees in a service industry, the human resource manger has to make efforts to cater for the employees’ welfare. The employees must be well motivated to be able to serve the customers in a proper manner. Managers in service industries such as hotels and in some cases suffer from high turnover rates (Benitez, Martin & Roman, 2007). This can be attributed to failed managerial skills in human resource department or incompetent managers. The service industry managers need to devise methods of managing their employees through effective human resource department. For the hotel business to maintain the employees, the human resource department must make efforts to know what can greatly motivate the employees and hence retain them in the industry. This is due to the mobility that exists in the service industry labor market. The human resource department in the service industry must always make sure that the relationship between them and the employees is maintained at all times (Benitez, Martin & Roman, 2007). Tasks of management serve an important part in business growth (Chopra, Sunil, and Peter, 2001). Planning involves determining the programs in place so that they are in line with the organization goals. The company future plans are all outlined by use of plans which can avoid crisis. Most of the companies that have experienced crisis have in most cases failed to plan and anticipate them. Through planning, all the errant procedures that could have brought disaster are avoided in the company. This function requires the human resource management to be actively involved in recruiting, training and selecting the employees who are qualified in delivering to company. Through effective planning, the human resource department can be able to maintain the working attitudes of the employees at the best levels. The human resource department must also put its focus on anticipated employees needs and make them available (Halan, 2005). Another important aspect in any business is organizing. Through good organization, business is able to achieve the goals set. Companies that have failed in organization leads to collapse as the goals set are not attained. Organizing is the main ingredient of the management and must be carried out to the completion. The human resource department is charged with responsibility of proper arranging all the activities of the personnel involved. This is done through a well laid out structural framework which enables in interactions among employees creating a good relationship. The command chain of authority in the company must be well laid out so that information is delegated appropriately. This helps in attaining the company’s goal. Controlling is a management aspect in any business. This involves measuring the output from the employees and making sure that there are no barriers to achieving the companies’ goal. In controlling, individual employees get insights of their performance through reports that are made available. The plans are all made to follow a laid out procedure to make it possible to attain the company’s goal. This is done by making sure that the company is not deviating and correcting any deviation. To carry out control, the human resource department has to conduct training, interviews and motivate workers. This is all carried out to make sure that the company will achieve the set goals. Directing is a managerial aspect which involves giving directions to the employees. This helps the organization to achieve its plan. To effectively direct employees, motivation, leadership and mentorship are some of the key requirements. The ability to tap maximum potential from the employees lies in the ability to motivate them adequately. The basis of directing is to form good industrial relationship and enhance employees’ contribution to well being of the company. The human resource management has to be fully engaged in giving directions in a firm. The human resource department works to bring together all levels of management to create harmony in issuing directions. For the function of directing to be successful, the human resource department has to do this while taking care of the employees’ expectations and feelings at all levels. The industrial relationships that are created by directing are between the employee and management. The human resource makes it possible for the selected employee to communicate with the management in an effective manner. This is by making a simple channel of communicating that is acceptable by the employee and management through a consensus. This is due to the fact that authority does not rely on management but it’s with the employees will to cooperate. Assumptions of the Economic Order Quantity (EOQ) model? The economic order quantity is an inventory control technique that has been utilised in deciding what could be the company’s optimal order quantity which can be achieved using the least price. This model utilises assumptions which are demand is known and consistent, the lead time is known and consistent, the inventory is received instantaneously, there is no quantity discounts, the variable cost are only ordering and holding cost and orders are placed to avoid stockouts (Chou & Chien-Chang 2009). The assumptions used are realistic and achievable as demonstrated through its use. The results that are achieved by using this model have also demonstrated that these assumptions are realistic. In these assumptions, the business is able to try and make it possible to have an ideal situation. The current holding method of the business should be made reasonable so as to have recommended results. Incase the company want to increase their holding cost; they have to store more in the inventory. This goes in line with the assumption that the only variable cost should be holding cost and ordering cost. Ordering cost becomes variable due to changes in inventory levels. The model gives have the optimal order quantity the moment holding cost and order costs are minimized. The lead time is assumed to be known and consistent. Lead time refers to the time that it takes from the ordering to receiving the product. This time can be determined by the company through efficient process of inventory. This is also further justified by the fact that replenishing the lead time across the suppliers and retailers is in most cases determined. The outcome is that this leads to a little variation (Chou & Chien-Chang 2009). These assumptions can all be established by the company before calculating EOQ. The online customers in most cases place their orders in advance which make it possible for efficient delivery. This makes it to determine the lead time more accurately. The company products demand can be estimated using the previous record and forecasting. This makes it possible to assume that the demand is consistent and known. The issue of quantity discount can also be easily assumed and quantified by the business before making calculations on EOQ (Zhang Patuwu and Chu, 2003). Safety stock can be incorporated in EOQ and re-order point (RP) while ordering inventory. To maintain sufficient safety stock is a task that requires dedication of time and effort. The problem lies from the fact that it’s hard to determine the demand and lead time. This leads to the situation where overreliance on the model can bring stock-out in the company. To make sure that this does not happen, the companies utilises safety stock. Safety stock refers to the amount of the inventory that is carried out in according to expected demand. The quantities should only be ordered at certain instances known as re-order point. The re-order point functions well in situations where the supplier has information on the exact amount and lead time needed for a product. In real life situation, demand varies from day to day. To protect the company from the stock outs, the safety stock must be maintained at all times. The approach that is used by a company should cater for the variations experienced in the demand (Wang and Toktay 2008). One of the approaches that can be used by the companies is probability approach model. The demand in this model is assumed to be distributed according to a certain mean and standard deviation. The main aim of this approach is to look into the probability of running out of stock in the company. This is carried out by plotting a normal distribution curve showing the expected demand and checking where the amount available is in the map (Wang and Toktay 2008). Another model which can be put to monitor stock levels is a quantity model with safety stock. Using a fixed order quantity system, the monitoring of the inventory level can be made possible and a new order placed when stock reaches a certain level. A reorder point is established and set to cater for the expected demand in the lead time. The reorder point is determined by considering the demand, shortage cost and the cost incurred in ordering. Different companies utilises different procedures to come up with their safety stock. These procedures include; fixed safety stock, time based calculation and statistical calculations (Wang and Toktay 2008). Uses of the EOQ model in practice The Economic Order quantity (EOQ) model is still widely used by many companies. This is to help the companies remain competitive in the market. The model main application in today companies operation is reducing stock-outs and back orders. Those companies utilizing this model have cited its importance in setting the costs for optimal order amount. Most of the current models that have been in place fail to appropriately forecast which leads to losses. This has made the Economic Order Quantity model to be of choice to the most of companies. Various software packages that are available have inaccuracies that come about from wrong data. Those companies that have failed to use EOQ have attributed this to bad experience with the available inventory models. Other management personnel do not have adequate knowledge on how the model works. This makes them use software packages that are in most cases unreliable. The software systems that are available are supposed to aid the models that are in place but can not replace them (Wang and Toktay 2008). Types of layout performance criteria Airport The design layout of the airport serves an important part in its operations and performance. The airport must provide customer with convenience, give the requirements for the best material handling and capital investment. The layout maximises the effectiveness of the process of handling the customers. This achieved by making an airport that can effectively handle the work operations smoothly at all times. The space in which the airport is operating in gives the facility its meaning. This should make it possible for all operations to be carried out in a fast manner as airport should be. The airport must be laid in a manner that creates a single functioning system for passengers. A passenger entering the airport s supposed to find all relevant departments with ease. The offices should be arranged in such a manner that the related operations are placed next to each other for convenience. The airport layout made must be able to accommodate future plans such as expansion and renovation. The airport must be capable of expanding in case the production needs changes (Chen & Sha, 2005). Bank The bank is another building that design layout influences its performance. The bank layout must be able to provide customer with convenience, good atmosphere, sales, financial welfare, communication and capital investment. For communication to be effected appropriately, the required facilities should be put up in the most convenient manner making it possible to communicate without a hitch. The design of the bank should allow the customers to have comfort in the waiting hall. The designing of the customer halls should be of good standards. This requires that the cost incurred by the bank in making this design should not be higher than the value brought by the employee (Chen & Sha, 2005). When receiving new customers’ in a bank, the first impression they get is the layout of the place. The building should be attractive so that it acts as a promotional feature for new investors and bankers. The bank design should allow ease of maintenance by making it possible to carry out cleaning and repair tasks effectively. Having a design of a safe banking is another feature that can enhance performance. The customers are attracted to areas and designs that will make the bank less venerable to insecurity. The employees’ morale is also affected by the design of the building. Banking halls should have bright coloured walls and spacious windows make employees’ spirits high. This ensures employees optimal performance in their tasks (Wang, Wu, & Liu 2001). Classroom A classroom design layout must ensure that there is flexibility and ease of communication between teachers and students. The design layout has a direct effect on the class performance. The classes which are well lit experiences a good communication process compared to poorly lit classes. The lighting must be made in a manner that the windows design allows maximum light while at the same time offering beauty. The classroom must also be flexible in that diverse learning activities can be carried out without any interruptions. The class space should be planned in such a way that it gives ample space to students to engage in their learning activities. Through the recommended design, the class performance can be improved to a higher level (McKendall & Shang, 2006). Product designers’ office The office should be designed in a manner to help in communicating with other related departments. The communications can be effected through use of proximity to production department. This enables ease of communication with the production managers on how the new design will be implemented. The working environment can also be improved through use of good design layout. A spacious office makes it conducive to work. The ventilation and lighting can be made to effectively improve the operation performance of the office. Through provision of good ventilation and lighting, the office can be able to carry out its duties in an aerated and lit area hence delivers efficiently (Chen & Sha, 2005). Law firm In a law firm, client is the most important person. This means that the design should provide client comfort. The law firm layout should consider a well laid out plan for the organisation structure and their offices. The design must be able to cater for the communication process. This is because the law firm depends on communications to be able to maintain their clients and build confidence. The performance of the firm is measured by the number of clients that the firm can be able to handle effectively within a specified time. When the design of the firm has been carried out in an organised manner, it’s possible to have high performance in the law firm. Other aspects of design that improve performance in a law firm include; capital investment, atmosphere and employees attitudes (Chen & Sha, 2005). References Benitez, J., Martin, J & Roman, C 2007, ‘Using fuzzy number for measuring quality of service in the hotel industry’, Tourism Management, Vol. 28, no. 2, p. 544-555. Che Rose, R & Kumar, N 2007, ‘The transfer of Japanese-style HRM to subsidiaries abroad’, Cross Cultural Management: An International Journal, vol. 14, no. 3, pp. 240-253. Chen, C & Sha, D 2005, ‘Heuristic approach for solving the multiobjective facility layout problem’, International Journal of Production Research, Vol. 43 no. 21, p. 4493-4507. Chopra, S and Peter, M 2001, Supply Chain Management, Upper Saddle River, NJ: Pearson Prentice Hall. Chou & Chien-Chang 2009, ‘Fuzzy Economic Order Quantity Inventory Model’, International Journal of Innovative Computing, Information and Control, Vol 5. No.9 , p. 167. Halan, Y 2005, Managing people, Sterling Publishers Pvt. Ltd, New Delhi. McKendall, A & Shang, J 2006, Hybrid ant systems for the dynamic facility layout problem, Computers & Operations Research, vol. 33, no. 3, p. 790-803. Sullivan, J 2000, ‘Recognize the importance of incentives and rewarding employees’, Nation’s Restaurant News, p. 36-37. Wang, T and Toktay, B 2008, ‘ Inventory management with advance demand information and exible delivery’ , Management Science, vol. 54, no. 4, p.716-732. Wang, T.Y., Wu, K & Liu, Y 2001, A simulated annealing algorithm for facility layout problems under variable demand in cellular manufacturing systems, Computers in Industry, Vol. 46, no. 2, pp.181-188. Zhang, G., Patuwu, B and Chu, C 2003, ‘A hybrid inventory system with a time limit on Backorders’, IIE Transactions, vol. 35, p. 679-687. Read More