STUDENT NAME: Hajra Nadeem

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PROGRAMME: BA (Hons) Business

BHL5000Management with HRM Assignment 2

STUDENT NUMBER: st20013327

Module Number: BHL5000

YEAR: 2
Term: 2

and

GROUP: 6

Module Title: HRM in Context

Tutor Responsible For Marking This Assignment: Kathryn Addicott

Module Leader: Kathryn Addicott
Assignment Due Date: 30th April 2013

Hand In Date: 30th April 2013

ASSIGNMENT TITLE: Assignment 2

FEEDBACK DATE(Return of assignments to students):
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HRM in Context
BHL5000
Assignment 2
4/30/2013
Hajra Nadeem (st20013327)
Cardiff Metropolitan University

Assignment 2

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Section A
Consult Capital (Synopsis)

Consult Capital is an HR consultancy firm based in Cardiff, Wales. The experienced

consultants that make up the firm claim that it is a one-stop shop, offering a
multitude of services to any type of business. Clients may range from small
enterprises to multi-national companies. Indeed, the firm also caters to non-profit and
governmental organizations.

The unique selling point Consult Capital uses is that its services are entirely tailored
towards the client in question. Whereas some consultancies offer set packages for
particular prices, Consult Capital makes the effort to understand the context of the
business and asks exactly what is needed and for how long. Even the prices vary
depending on the organizations.

The company is passionate about its values, which include approachability, integrity,
boldness, excellence and clarity. The goal of Consult Capital, unlike the majority of
businesses, is not to make profit but to increase knowledge and solve problems in an
innovative manner.

The current economic climate has resulted in the redundancy of many employees.
Consult Capital can help these employees by offering outplacement services,
wherein the firm tries to locate new jobs and help the clients transition, and by
offering career management advice.

John Lewis (Synopsis)

John Lewis is a highly successful chain of department stores all over the United
Kingdom. It has a unique arrangement in that all employees, from janitors to CEOs,
are given a share of the company. This is known as the John Lewis Partnership. The
partnership operates with the definitive goal of ensuring the happiness of all its
members. The partnership is an innovative way of making employees involved and
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motivated in the business. The company has strong values rooted in responsibility,
principles and personal development. These are the three commitments of John
Lewis employees.

It can be difficult to run such a distinctively structured organisation, as there will

always be instances of employees taking advantage of the care they are given. It is
therefore necessary to be ruthlessly efficient to ensure that everyone is working
their hardest.

Planning is the key to running a successful business, which is why John Lewis has
mapped out an ambitious strategy to become Britains leading retailer. This is in
accordance with one of the three commitments mentioned earlier: development.
The organisation is also invested in the development of its employees. It supports
workers by providing university services in the University of John Lewis.

Furthermore, employees are encouraged to map out a clear career path which they
are welcome to discuss with managers. Employees can ask for training in a certain
subject if they feel so inclined, and this can be brought up at a Personal
Development Plan meeting.

Essentially, John Lewis has managed to bring out the best in employees by making
them feel valued. Staff are willing to work because the better they perform, the more
successful John Lewis is and the more valuable their shares become.

(485 words)

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High Street Heaven

Analysis Report
Section B
4/30/2013
Hajra Nadeem (st20013327)

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Table of Contents
1.

Introduction .......................................................................................................... 7
1.1. Briefing .......................................................................................................... 7
1.2. Purpose of Report ......................................................................................... 7
1.3. Methods Used ............................................................................................... 7

2.

Problems/Challenges........................................................................................... 8
2.1. PESTLE Findings .......................................................................................... 8
2.2. SWOT Findings ............................................................................................. 9

3.

Strengths/Opportunities ..................................................................................... 10
3.1. PESTLE Findings ........................................................................................ 10
3.2. SWOT Findings ........................................................................................... 11

4.

Suggestions ....................................................................................................... 12
4.1. Suggested Actions ...................................................................................... 12
4.2. The Role of HRM ........................................................................................ 13

5.

Conclusion ......................................................................................................... 14

6.

References ........................................................................................................ 15

7. Appendices .......................................................................................................... 17
7.1. PESTLE Analysis........................................................................................... 17
7.2. SWOT Analysis.............................................................................................. 18

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1. Introduction
1.1.

Briefing

High Street Heaven is a fairly successful chain of ten retail departments dispersed
over Wales and England. Established in 2004, the store was originally based in
Cardiff and sells a variety of items. The store was originally extremely successful and
produced an admirable amount of profit, but because of the economic depression
High Street Heaven is suffering along with many other high street retailers. There
has been a recent outcry from retailers complaining of business remaining stagnant
and even declining (Stewart and Elliot, 2013).

1.2.

Purpose of Report

A vital contributor towards success is full knowledge of the strengths and

weaknesses of oneself and ones opponents (Tzu, 1913; cited by Hagos and Pal,
2010). It can therefore be extrapolated that it is crucial for businesses to continuously
reflect on themselves and to evaluate the outside environment in order to ensure that
their planning processes and strategies are relevant.

This report is an in-depth analysis of the internal organisation itself and the external
environment in which the organisation operates. It will provide the information
necessary to guide the company into facing their problems and challenges and
exploiting their strengths and weaknesses, thus remaining successful in the face of
adversity.

1.3.

Methods Used

This investigation was carried out by performing thorough SWOT and PESTLE
analyses. The obstacles faced by the organisation were identified and evaluated, as
well as the strengths of the company. Lastly, the report will proffer suggestions to
address the aforementioned issues with a particular emphasis on Human Resource
Management (HRM).

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PESTLE analysis stands for political, economic, sociological, technological, legal and
environmental factors. It provides a comprehensive examination of the context in
which the business operates (Murray-Vebster, 2010).

SWOT analysis is an acronym for strengths, weaknesses, opportunities and threats.

Such an investigation gives internal insight as to the organizations fortes and
liabilities (Henry, 2008).

2. Problems/Challenges
2.1.

PESTLE Findings

As previously described, the PESTLE is an analytical tool that facilitates a broader

understanding of the surroundings relevant to a business. A thorough PESTLE
analysis has been conducted and can be found in Appendix 7.1. It can be seen from
the analysis that a number of pertinent issues are affecting business at High Street
Heaven.

The most obvious obstacle for High Street Heaven is the economic downturn that
has been affecting the United Kingdom since late 2008 (Monaghan, 2009). The
impact of the recession has critically impacted High Street Heaven, as can be seen
by the dramatic 15% decline in profit in poorer regions like Swansea and Newcastle.
The economic slump has made banks wary of companies, thus prompting them to
cut overdrafts and increase monthly loan repayments. Lloyds TSB has proven this to
be true by decreasing High Street Heavens overdraft by 35% and increasing
monthly loan repayments by 7%.

People are also inevitably affected by the recession. According to Mulhearn and Vale
(2012), incomes tend to decrease in the face of a depression, and thus people are
more likely to save money.

Although the recession and its impact on individuals is an economic issue, it has
clear sociological underpinnings. Consumer psychology is significantly impacted and
individuals feel insecure about spending money (Hawkins et al., 2010). High Street
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Heaven is well-equipped to deal with this phenomenon as it sells products at a

reasonable price.

The PESTLE further goes on to discuss technological issues. Craven (2013) reports
that in March 2013, there has been a 12% increase in online sales. This is a stark
contrast to the 0.4% rise at department stores. High Street Heaven is at a distinct
disadvantage as the company does not offer multi-channel distribution. By lacking
this necessary complement, High Street Heaven is losing out on an entire
demographic of consumers.

The last challenge that the PESTLE uncovered was related to legislation. In the
midst of implementing cost-cutting measures, it is crucial that High Street Heaven
maintains the fulfillment of all relevant legislation. This includes but is not limited to
ensuring that appropriate protocol is applied when terminating employees, providing
at least the minimum wage ordained by law, and upholding Health and Safety
regulations. Adhering to appropriate legislation is highly pertinent for organizations
regardless of the context. Breaching the law can have heavy financial repercussions
and taint a companys reputation (Herbert, 2011; Wallop, 2011; Nichol, 2013).

2.2.

SWOT Findings

The SWOT (found in Appendix 7.2) uncovered several key problems and challenges
to be dealt with.

Gregory (2009) highlights the importance of employee satisfaction, emphasizing that

it is the key to any successful organization. Unfortunately, an annual staff survey at
High Street Heaven completed by 65% of employees conveyed that the majority of
staff were unsatisfied with the opportunities the company provided for promotions
and the chance to be involved in decision-making. Indeed, the lack of employee
engagement can be gauged from the 35% of employees who didnt even complete a
survey. This explains the increasing staff turnover that has risen to above average
levels in 2012. The company has no choice but to resort to further recruitment, which
is an expensive, time-consuming, and possibly even futile process. Rather than

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repeating the cycle of recruiting and losing staff, it would be more feasible to find
ways to reduce staff turnover.

A further issue related to staff dissatisfaction could be the gross inequality of gender
distribution at management level. Medland (2012) discusses a survey conducted by
executive search firm RSA, explaining that women bring empathy and intuition to
leadership (p1). Moreover, it is of vital importance that companies do not
discriminate gender in the workplace from a legal perspective. The glaring contrast
of the vast number of men and the few women at management level has been more
or less constant since 2009. The gender discrimination is obvious and is likely to be
called into question if continued.

Another weakness High Street Heaven has experienced has been the steep decline
in profits from Swansea and Newcastle. Suggestions to combat this loss have been
made in Section 4.

External threats to the retailer include the fierce economic recession, which has led
to mistrust from banks and a decreased working capital, and competition from other
high street retailers.

3. Strengths/Opportunities
3.1.

PESTLE Findings

The PESTLE analysis revealed numerous opportunities that High Street Heaven can
exploit.

First of all, political interest in the success of high street retailers is at an all-time
high. Prime Minister David Cameron has expressed concern for high street
department stores multiple times, even appointing retail expert Mary Portas with the
task of investigating the issue (Kollewe, 2012). The success of the high street is
important for the government because it is widely believed that consumer spending
will drive the economy out of recession (Crutsinger, 2013). Local Growth Minister
Mark Prisk is a fundamental part of changing the high street retail industry to help it
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survive. He did this by establishing the Future High Streets Forum, an organization
with the role of facilitating high street retail business (www.gov.uk, 2013). The
government is further looking to enliven town centres by renovating unused offices
as areas of residence, thus increasing resident population and local footfall
(www.gov.uk, 2013; p1). Political involvement has therefore led to a supportive
institution and access to a larger customer base. These factors are certain to help
High Street Heaven in its endeavours to succeed.

High Street Heaven is currently seeking to promote a positive image to both

employees and the wider community. Examining the sociological aspects of the
business context displays a distinct rise in ethical consumption, showing that there is
an ongoing social trend of consumers caring about corporate social responsibility
and ethics (Pelsmacker et al., 2005). This insight provides an opportunity to High
Street Heaven, showing what customers care about and thereby providing the
company with an idea of what kind of image to build. This prospect is closely linked
with the environmental factor of the PESTLE analysis.

The PESTLE next investigates technological elements. This is an area that provides
ample opportunity to attract a wider clientele using innovation and technology
efficiently. This can be done by opening up the channel of distribution and exploring
the avenue of e-commerce. This is certain to appeal to a broader demographic,
thereby boosting sales exponentially.

3.2.

SWOT Findings

As a retail department store that until now has been vastly successful, High Street
Heaven has various strengths that it has built over the eight years it has been
running. The company has a strong established customer base on a national level,
which is imperative for a business to succeed. It is unlikely that High Street Heaven
will lose these customers as further strengths of the store include good quality
products, excellent customer service and reasonable prices.

The annual staff survey shows that employees are content with the training they are
provided, the environment they work in, and the teamwork structure. Whereas the
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majority of organizations have a higher ratio of male to female employees

(Stevenson, 2012), the net ratio of all staff at High Street Heaven favours women.
This is an asset unique to the company and is likely to contribute to the positive
image it is trying to perpetuate amongst employees and consumers.

Although staff have expressed dissatisfaction with their low level of involvement, the
company has made it clear that it does care about employee contribution and is
willing to make a marked effort to retain talented employees.

The opportunities that has arisen from the SWOT analysis include promoting gender
equality at a management level and building a positive reputation. Further
opportunities are explored in Section 4.

4. Suggestions
4.1.

Suggested Actions

There are two main courses of action that would strongly benefit High Street
Heaven.

The primary problem faced by High Street Heaven is the decrease in working capital.
This can be countered by securing funding from the growing number of institutions
interested in helping high street retailers succeed (as was discussed in Section 3.1.).
There are many government grants and financial organizations willing to invest
money in promising projects. One such company is the UK Business Funding Centre
(www.ukbusinessgrants.org, 2013).

The second recommended course of action is to implement a form of e-commerce to

provide consumers with a more convenient, multi-channel distribution. The important
of using relevant, up-to-date technology has been discussed briefly in Section 2.1.
Online shopping would increase the customer base, thus boosting sales.

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4.2.

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The Role of HRM

HRM is a fundamental building block of running a business. In the case of High

Street Heaven in particular, the stress placed on HRM can simply not be enough.
This is because the most efficient way to cut costs in an organization is to utilize all
of the resources as efficiently as possible and the most important resources in an
organization are the employees.

There are numerous key issues that must be discussed in relation to HRM. The first
of these is the importance of increasing employee engagement. Feedback from staff
has shown that this was dissatisfactory in the past, and it would be pertinent to
improve. It has also been agreed that the HR team must delegate work to line
managers to give them a more hands-on approach to work. For instance, the line
managers have been tasked with handling the issues uncovered in the staff survey.
This increase in responsibility has several results. Work efficiency is increased,
which means the company is saving money and time by having one capable
employee handle different tasks. Secondly, employees feel more involved and
engaged in the workplace as their contribution has increased. Thirdly, increased
responsibility can be perceived as an intrinsic reward. In times of recession, it is
granted that organizations are unlikely to provide extrinsic rewards. Intrinsic rewards
like praise and a show of trust towards employees can sometimes be more than
enough to boost morale.

Another suggestion that would have multiple results is the promotion of women into
management level. This would firstly dissolve any brewing accusations of gender
discrimination in the workplace. Office morale would improve infinitely, as the
prospect of employees being promoted is a clear result of the feedback from the
annual surveys. Employees would feel heard and appreciated. Lastly, this would
contribute hugely to the positive image the company is trying to shape.

Finally, when expanding the retail chain, it is important to outsource employees to

ensure high quality work from an experienced source, for as cheap as possible.

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5. Conclusion
High Street Heaven is a typical example of a retailer suffering from the economic
slump. However, if managed correctly, the business can still succeed. This report
shows the importance of analysing internal and external factors that affect the
company and how to use this information most effectively.

To prosper, the company must take certain measures to increase its working capital
and to reach out to as many consumers as possible. It must further ensure that
employees are satisfied and feel like they can grow professionally working with this
company. It is vital that the staff turnover rate decreases and there is retention of
talented staff members.

(Total word count of Section B: 2,163 words)

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6. References
1. Craven, N. (2013) MPs prepare for marathon inquiry to save Britains troubled
high streets. This is Money.co.uk [Online] Available at
http://www.thisismoney.co.uk/money/news/article-2316092/MPs-preparemarathon-inquiry-save-Britains-troubled-high-streets.html?ito=feeds-newsxml
(Accessed 28 April 2013)
2. Crutsinger, M. (2013) Economy speeds up on consumer spending. MPRNews.
[Online] Available at
http://minnesota.publicradio.org/display/web/2013/04/26/business/economyspeeds-up-on-consumer-spending (Accessed 28 April 2013)
3. De Pelsmacker, P., Driesen, L., Rayp, G. (2005) Do consumers care about
ethics? Willingness to pay for fair-trade coffee. The Journal of Consumer Affairs
39 (2). [Online] Available at
http://www.people.fas.harvard.edu/~hiscox/Depelsmacker.pdf (Accessed 15 April
2013)
4. Gov.co.uk (2013) High street need to change to prosper. [Online] Available at
https://www.gov.uk/government/news/high-streets-need-to-change-to-prosper
(Accessed 15 April 2013)
5. Gregory, K. (2009) The Importance of employee satisfaction. [Online] Available
at
http://www.neumann.edu/academics/divisions/business/journal/review2011/greg
ory.pdf (Accessed 15 April 2013)
6. Hawkins, D., Mothersbaugh, D., Mookerjee, A. (2010) Consumer Behavior:
Building Marketing Strategy. Tata McGraw-Hill Companies, Inc., New York.
7. Henry, A. (2008) Understanding Strategic Management. Oxford University Press,
Oxford.
8. Herbert, L. (2011) Tesco fined for safety breaches. Bracknell Forest Standard.
[Online] Available at
http://www.getbracknell.co.uk/news/s/2090343_tesco_fined_for_safety_breaches
_ (Accessed 15 April 2013)
9. Kollewe, J. (2012) Up to 40%of high street shops could close over next five
years. The Guardian. [Online] Available at
http://www.guardian.co.uk/business/2012/mar/20/high-street-shops-close-deloitte
(Accessed 15 April 2013)
10. Medland, D. (2012) Women and the Workplace: The benefits of gender diversity
put to the test. Financial Times [Online] Available at
http://www.ft.com/cms/s/0/1fc8a3dc-0d65-11e2-97a100144feabdc0.html#axzz2Rv92eNHi (Accessed 15 April 2013)
11. Melles, T. H. and Guban, P. (2010) The means of analysis and evaluation for
corporate performances. Annales Universitatis Apulensis Series Oeconomica 12
(1) [Online] Available at
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12.

13.
14.
15.

16.

17.

18.

19.

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http://www.oeconomica.uab.ro/upload/lucrari/1220101/43.pdf (Accessed 15 April

2013)
Monaghan, A. (2009) UK recession: Its now official. The Telegraph. [Online]
Available at http://www.telegraph.co.uk/finance/recession/4321414/UKrecession-Its-now-official.html (Accessed 15 April 2013)
Mulhearn, C. and Vane, H.R. (2012) Economics for Business, 2nd edition,
Palgrave Macmillan, London
Murray-Vebster, R. (2010) Management of Risk. The Stationary Office, Norwich
Nichol, S. (2013) Workers at risk in safety breach at Newcastle store. Chronical
Live. [Online] Available at http://www.chroniclelive.co.uk/news/localnews/workers-risk-safety-breach-newcastle-1352773 (Accessed 15 April 2013)
Stevenson, A. (2012) Statistics confirm its still a mans world. The Sydney
Morning Herald. [Online] Available at http://www.smh.com.au/executivestyle/statistics-confirm-its-still-a-mans-world-20120727-22zki.html (Accessed 15
April 2013)
Stewart, H.,and Elliot, L. (2013) Fall in high-street activity raises fears of triple-dip
recession. The Guardian. [Online] Available at
http://www.guardian.co.uk/business/2013/apr/24/retail-sales-fall-fears-recession
(Accessed 25 April 2013)
UK Business Funding Centre. (2013) South West Business Grant. [Online]
http://www.ukbusinessgrants.org/qa/qa.php?id=South-West-Retail-BusinessGrants (Accessed 15 April 2013)
Wallop, H. (2011) Marks and Spencer hit with 1m asbestos fine. The Telegraph.
[Online] Available at
http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/8640384/M
arks-and-Spencer-hit-with-1m-asbestos-fine.html (Accessed 15 April 2013)

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7. Appendices
7.1. PESTLE Analysis

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7.2. SWOT Analysis

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