Introduction
Today’s businesses are facing many problems and challenges that relate to human resource management. While the human resource section is the most important arm of any organisation, it is also one of the most challenging areas to manage to ensure maximum productivity.
In recognition of the challenges that face human resource managers and organisations in managing this vital resource, many studies and approaches have been suggested to offer important insights into how organisations can effectively manage the human resource for good productivity and outcomes for the organisations (Caliskan, 2010). Despite the availability of the suggested approaches, implementing them is also a major issue.
Organisations find themselves in major problems and challenges with their human resources. The situation can lead to poor performance, non-attendance, low morale, low job satisfaction, and high rates of turnover that make it difficult for an organisation to achieve its goals (Krishnan & Singh, 2006).
A good example of an organisation that is facing human resource challenges is evident in the new owners of a mining company where there have been higher levels of conflicts that have led to strikes, low productivity, and absenteeism among other problems.
This paper aims at identifying the challenges the organisation is facing and making important strategic human resource management strategies that the organisation should adopt to turn around the current relations between the management and employees.
Major Problems that the Organisation’s Human Resource is Facing
It is evident that the new owners have inherited a myriad of challenges in the human resource from the previous management. This case has greatly affected the company’s ability to achieve its potential in terms of productivity. These challenges must be addressed appropriately to ensure that the organisation can meet its production capacity and financial obligations in the highly competitive sector.
The company is facing major problems in the area of employee motivation and commitment to work. In this case, the high levels of absenteeism and underperformance, which have been witnessed in the company, have greatly hindered its overall performance. Secondly, the company has a limited control and authority over the employees.
Besides causing major rifts between the management and the employees, the situation has led to the establishment of a big divide of employees versus the management. Lastly, the company also lacks elaborate strategies regarding recruitment and selection, training and development, and employees’ welfare.
This gap has led to the formation of informal unionism, which has worked to the disadvantage of the organisation, thus leading to many strikes and industrial actions that are too costly to the organisation. In this case, it is evident that the management must find new strategic human resource management approaches to turn around its current situation into a more robust management and employee performance, which will benefit the organisation and employees.
Key Factors of Consideration in Formulating HRM and ER Strategy for the Company
In the process of formulating a strategic HRM and ER strategy, many factors must be considered to ensure that the adopted strategies give the organisation the best opportunity towards effectiveness, efficiency, and productivity. The first factor of consideration is the organisation or stakeholders’ aims and goals.
According to Nankervis, Baird, Shields, and Coffey (2014), each organisation has its main agenda or a central goal. The company’s main goal is geared towards the production of coal for profit making purposes. Therefore, any issues that are preventing it from achieving this goal must be addressed.
The company’s human resource is the biggest challenge, owing to the low productivity, low morale, and frequent strikes among other challenges that emanate from the employees (Ross & Bamber, 2009). The organisation must review its recruitment and selection strategies to ensure that workers who have the right skills and motivation receive the opportunity to work for the company.
Situational factors also affect the organisation from outside and from within. The Harvard HRM model provides situational factors as a key area of consideration when coming up with a strategic HRM (Zheng, Rolfe & Di Milia, 2007).
Workforce characteristics, labour market, unions, laws and societal values, and task technology among other considerations are very critical in coming up with an elaborate and effective strategic human resource management approaches (Hutchings, De Cieri & Shea, 2011). It is evident that the coal-mining sector is still deeply unionised. Hence, many organisations follow the tenets of the pluralist theory.
The company needs to change the current structures of the informal workers union to ensure that they are registered in a lawful and recognised union as guided by the labour regulations. The third important factor is the human resource policy in place. The role of human resource relations is to ensure the recruitment and retention of highly qualified individuals to guarantee the achievement of the organisation’s goals.
In this case, the role of HR at the organisation has not been well defined. The situation has allowed the thriving of a low performance culture and poorly qualified and trained human resources (Edwards, 2013). The human resource department needs to take its rightful place in ensuring competency, employee motivation, job satisfaction, and high employee discipline (Ross & Bamber, 2009).
For instance, when attracting and retaining highly qualified employees, the organisation must apply specially designed selection strategies that focus on good remuneration and employee safety, which will warrant the recruitment of the best personnel (Zheng et al., 2007). The role of the management is another major factor that the organisation must consider.
In this case, while the management of employees and the approach towards a unionised workforce indicates a move towards pluralist approaches to management, the implementation of better human resource approaches that focus on better employee training and development, safety considerations, and better pay will give the top management more authority and legitimacy over the employees (Bowen & Barry, 2015).
Such authority and mandate will be in line with a unitarist theory and its approaches where power is concentrated on the management (Caliskan, 2010). In this case, it is important for the human resource management to implement the key tenets of its policies to guarantee high discipline requirements and effective recruitment and selection strategies so that employees can remain loyal to the management.
Conclusion
It is evident that the organisation is facing major problems in its human resource management function and hence the need for changes in how the organisation is managed. The main strategic approaches that the organisation will consider will relate to increasing employee motivation and commitment to work.
Further, the organisation will focus on ensuring that it has elaborate HR policies, which will guide the way the organisation will implement the strategies. As guided by the requirements of pluralist approach, ensuring that the organisation advocates a formal, rather than an informal union, will be a move to the right direction.
However, in ensuring more legitimacy and authority of the management, putting in place measures that address employees’ welfare in terms of training, development, and safety will be an important step towards a unitarist approach. The challenges that the organisation will face such as opposition to change, financial implications, and conformity to laws and regulations in the industry will be well addressed using the above approaches.
Recommendations
While a change is inevitable in any organisation, it attracts many challenges, which if not well handled, may derail any progress towards the required changes. At the coal-mining company, the implementation of new HRM strategies will attract various problems and challenges that must be well addressed for success to be achieved.
The first challenge is financial implications of the changes. In this case, while the main goal of the new strategies is to ensure better financial performance in the organisation, the strategies may pose big challenges in the short-term (Ross & Bamber, 2009).
In fact, implementing new training strategies, recruiting new personnel, and terminating unnecessary contracts have immediate financial implications. The organisation needs to understand that while the new strategies have immediate financial implications on the organisation, the organisation will greatly benefit in terms of organisational effectiveness and efficiency, which will lead to better financial gains.
The organisation can also implement the strategies in phases, which will ensure that the financial burden on the organisation is spread over a long duration. According to Mitchell, Obeidat, and Bray (2013), the use of expert strategists and consultants is also an important way of implementing important cost reduction approaches to minimise the overall operations cost.
The second challenge is opposition from the employees who are informally but strongly unionised as evident from the successful strikes and industrial actions that the company has faced. The current suggestion towards ensuring that workers are formally unionised may not go well with the leaders of the informal union at the company.
Such opposition may lead to ‘go-slows’ or other actions that may derail the company’s desire to move towards more effective management approaches. To counter the above challenge, the organisation should form consultative forums with employees and their informal leaders to ensure that they are part of the process and changes that the organisation will undertake.
Reference List
Bowen, B., & Barry, M. (2015). Recasting industrial relations: Productivity, place and the Queensland coal industry, 2001–2013. Journal of Industrial Relations, 57(1), 48-71.
Caliskan, N. (2010). The impact of strategic human resource management on organisational performance. Journal of Naval science and engineering, 6(2), 100-116.
Edwards, M. (2013). Industrial Relations in Mining – A Growing Cost to the Industry in Australia?. Web.
Hutchings, K., De Cieri, H., & Shea, T. (2011). Employee attraction and retention in the Australian resources sector. Journal of Industrial Relations, 53(1), 83-101.
Krishnan, S., & Singh, M. (2006). Strategic Human Resource Management: Three-Stage Process and Influencing Organisational Factors. Human Resource Management, 1(1), 1-37.
Mitchell, R., Obeidat, S., & Bray, M. (2013). The Effect of Strategic Human Resource Management on Organisational Performance: The Mediating Role of High-Performance Human Resource Practices. Human Resource Management, 52(6), 899-921.
Nankervis, A., Baird, M., Shields, J., & Coffey, J. (2014). Human Resource Management: Strategy and Practice. South Melbourne: Cengage Learning.
Ross, P., & Bamber, J. (2009). Strategic choices in pluralist and unitarist employment relations regimes: a study of Australian telecommunications. Industrial & Labour Relations Review, 63(1), 24-41.
Zheng, C., Rolfe, J., & Di Milia, L. (2007). Strategic human resource management and business performance of the regional coal mining industry in central Queensland. Web.