Вы находитесь на странице: 1из 13

1

NAME: Lindiwe Mhlanga

FACULTY: Economics and Management Sciences

DEPARTMENT: Namibia Business School

SUBJECT: Human Resource Management Strategy

SUBJECT CODE: CBPM 5999

STUDENT NUMBER: 201800411

ASSIGNMENT: 01

LECTURER: Dr. OLEGUN


2

Executive summary

Asian paints began with a humble start in 1942 and become a second largest paint company, the
company was so large in that it operated in 19 countries and had 26 paint manufacturing facilities
in the world. The management was so ambitious to sustain the status quo in such a way that it
ventured into diverse product and even abroad. This continuous expansion at some point got out
of control such that the production and productivity in the company started declining in 1992
causing the company to work at loss. It is argued though that during this extravagant expansion
thought about change management never crossed the minds of the management to apply the
strategies, yet is evident that the company had HR personnel. It is the HR personnel role to
advice the company about the ideal steps in implementing change (acting as a change agent and
participating in formulating strategies). The company had signed an increment settlement with its
workers union and it was agreed that salaries will be frozen for 3 years after the settlement. It
was the aftermath of the Gulfwar that oil prices escalated causing inflation of products across the
world and elevating the standard of living. It went not easy for the Asian paints employees to
meet their personal needs thus they resorted to their employee through their union to ask for
interim of INR 500. Negotiations did not go well as the management declined related to 3 years
freeze agreement and also company was running at a loss because of decreased production and
productivity. Conflict between the employer, employee and union began, the company had lost
its loyalty by the employees as it declined the interim. On the other hand the union wanted to
prove itself to the workers to gain their loyalty and also wanted recognition from management. It
is thus the conflict turned into a labour dispute. Things turned ugly at the company, employees
became violent, acting in misconduct, sabotage, threatening and evening assaulting those who
continued with work. The work environment became unsafe and hazardous. The managemet
acted soft avoiding the situation hoping it will calm down to no avail. Employees were
victimized and dismissed from work without hearing. Immediate strategies of HRM were needed
to intervene to resolve and mediate with these problems. It called to immediate calm situation,
regain employee loyalty through social contracts, collective bargaining for involvement and
recognition of all parties and involvement of the union third party for recognition.

Problem identification

“Human resource management (HRM) is adopted by many companies because of its benefits.
But at the same time, various challenges and issues may emerge in front of managers of human
resource department while performing their duties” (Maharjan, 2019). Any capable HR manager
would work on these issues and challenges to prevent the organizational activities from being
obstructed. The main thing is to first identify these issues.

In this case study HRM problems that could be identified include, employer- employee conflict,
lack of employee discipline, employee compliance with laws and regulations, employee and
3

productivity and performance, job satisfaction, employee quality of life, employee safety and
management changes or even more.

Organisational decreased Productivity and performance

Maximizing profit and minimizing cost is the essence of productivity and the main goal why
businesses exist. Higher the productivity level, more successful will be the company. HRM
should always focus on maintaining high productivity level. If the company does not perform
well, not making profit obviously stake holders will be affected including employees as there
might be retrenchment, or shutting down of firm or stagnant salaries for a long period. In this
case Asian Paints was performing well since the establishment in 1942, then its production and
went down in 1992 which became a major problem to the management as the company could not
meet the main goal of maximizing profit. The plant was incurring losses and could not reach
breakeven such that could not make positive adjustments to salaries of employees leading
dispute.

Employer- employee conflict

Handling employee – Manager Conflict is a critical and crucial task taken care of by the Human
Resource. This usually arise from disagreements in employer and employee negotiations
especially on increment of salary wages or welfare of employees. In this case unions usually
come in to the negotiations represent employees, which then become a labour dispute if
agreements are not reached. Once the unions have entered they become a challenge for the HRM
with their attitudes perpetuating the disputes, making them violent and leading to legal actions.
The negotiations may be related to change in diversity, globalization which increases the
standard of living. With the Asian Paints case, the conflict emerged in February 1992 when the
workers union made negotiations with management on increase of employee salaries only to find
that the management did not agree as per their agreement with workers about freeze of salaries
for 3 years after an increment in 1991. The conflict escalated in April 1992 after an annual
performance appraisal whereby the management announced special increments for only three
white-collared employees related to their outstanding performance the previous year. The union
felt that these workers were still part of the union settlement, so there were not supposed to be
treated with exception and that all the workers should be awarded same increment or else
withdraw the increase from the awarded. This led to tension at the plant between the
management and union causing a hostile environment.
One would pick up an argument though why the union was basing its demands on the appraisal
as the reward policy supports that. “The philosophy recognizes that if HRM is about investing in
human capital from which a reasonable return is required, then it is proper to reward people
differentially according to their contribution (ie the return on investment they generate)” (
Amstrong,2010). Henri Fayol in his theory second principle states that In order to get things
done in an organization, management has the authority to give orders to the employees. Of
4

course with this authority comes responsibility. According to Henri Fayol, the accompanying
power or authority gives the management the right to give orders to the subordinates. The
responsibility can be traced back from performance and it is therefore necessary to make
agreements about this. In other words, authority and responsibility go together and they are two
sides of the same coin.

The unitarist perspective implies that the organization should be an integrated group of people
with single authority and loyalty structure, sharing same objectives and values. In this case
usually there are no conflicts or if any are easily resolved, in the case of third party especially
unions there increase conflict because the union also wants authority and loyalty with its
members. The workers will be loyal to their unions as they believe that they are only the mouth
of peace for them in negotiations and have much value as they are registered.

Employee quality of life and productivity

Employees have responsibility for their dependents to provide them with the basic physiological
needs and also to balance with their work life with good performance and productivity, this is a
challenge to HRM as the personal life of the employees and organization productivity especially
related to organizational costs or finances against employees‟ wages. The Maslow hierarchy
theory of needs emphasizes that in order for anyone to have quality life must go through the five
stages, beginning with first stage of having physiological needs (food, shelter and security) thus
every employee work towards meeting these. In this case, there was tension and a hostile
environment at a workplace between managers and workers because of salary increment
negotiations. This began after changes globally that occurred after the Gulf War and oil prices
that had escalated across the world. Increase in Consumer price index (CPI) causing rises in
inflation and commodity prices escalation. The workers could not meet basic life demands as
tabulated by Maslow, their personal life and work were imbalanced, they could not afford the
high prices so they opted to negotiate with their employer for interim. The employers were acting
in good faith knowing they had a privilege to appeal to their employer as per employer-
employee relationship in times of need. Unlucky for them they did not know the company was in
its dark days of recession, were all in dilemma cause of the environmental changes.

In contrast Henri fayol states that organizational goals come first than employee personal
interest. The theorist furthermore says “…in order to have an organization function well,
personal interests are subordinate to the interests of the organization (ethics). The primary
focus is on the organizational objectives and not on those of the individual. This applies to all
levels of the entire organization, including the managers”.
5

Discipline

This is one of the important issues that HRM needs to handle at present days. Lack of discipline
causes various problems which ultimately affect the productivity of the company. Fayol in his
theory illustrates that management is about obedience which is discipline. The theorist went on
to say “It is often a part of the core values of a mission statement and vision in the form
of good conduct and respectful interactions. This management principle is essential and
is seen as the oil to make the engine of an organization run smoothly”. RHMs usually
face big challenge in maintaining discipline to the workers in times of conflict especially related
to salary increment negotiations and when union is involved. Despite of high demands in cost of
living, workers should remain disciplined at work for a harmonious employer- employee
relationships and a healthy environment. In this case it is understandable that the workers were
having financial crises in meeting the cost of living but that did not give them reason to sabotage
work, damaging machines, threatening and beating up managers. The workers acted
undisciplined even when they refuse a free will gift from their employer and refused 75 INR
offer.

Management Changes

As cited by the Atlaas staffing article accessed (9,07,2020), “ As a business grows, its strategies,
structure, and internal processes grow with it. Some employees have a hard time coping with
these changes. A lot of companies experience decreased productivity and morale during periods
of change. This is evident with Asian paints as the production and productivity decreased in
relation to the extravagant expansion.

Employee safety

Health and safety standards are probably one of the more obvious human resource challenges.
Not only does labor law govern these concerns, but they‟re also of great importance to general
employee wellbeing. According to the Maslow hierarchy of needs theory safety is in the second
stage meaning it is so important for any human being. Safety needs include security, employment
and resources. A safe environment will yield to an affective commitment by an employee to his
organization. This also brings loyalty and emotional attachment. In this case feeling safe at work
is something far to be reached. The company surroundings have turned to a hostile and violent
environment, there is no feeling of being safe, one goes to work not knowing he will come back
home safe or injured, emotional harassed, worse being dismissed from work. The workers had
indulged in misconduct, abusing and threatening managers and other workers who continued
with their work making them feel unsafe. It went even worse when the employers started
assaulting the engineers; this was the outmost unruly behavior.
6

Compliance with laws and regulations

It‟s the Human Resource team‟s job to ensure that all employment rules and regulations of the
government and company regulations are maintained by the employees. This is easier said than
done as getting all employees to abide by the company policy is a huge task, especially in Multi-
National Companies consisting more than a thousand of employees. Job regulation aims to
provide a framework of minimum rights and rules. Internal regulation is concerned with
procedures for dealing with grievances, redundancies or disciplinary problems and rules
concerning the operation of the pay system. External regulation is carried out by means of
employment legislation, the rules of trade unions and employers‟ associations, and the regulative
content of procedural or substantive rules and agreements. Employees with their unions should
ensure that negotiation actions are in accordance with the existing laws, acts, regulations,
policies and procedures. This includes the constitution of the country which is the supreme law,
Employment act, Labour relations act, the organizational culture, and standard operating
procedures. With Asian Paints it is so glaring to anyone that the union and the workers defied the
laws and regulations in their strike action. No law that allows damage of property, misconducts,
sabotages, neglect of duty and assault of other employees. Bezuidenhout ( 2007,10) in the rights
of an employee illustrate that the Labour Relations Act gives right of an employee to strike and
collective bargaining providing the following of rightful procedures. Seriously on these note
there is no law that warrants unruly behavior, the strike action and the lockout were non
procedural and unlawful.

It can be argued that the workers were reacting to the management negative responses of
discriminating, victimization by dismissal but the Industrial Relations Act states clear that for
any grievances launched by employees to the employer must be done procedural and lawful.

Employee job satisfaction

Attaining employee satisfaction is by far one of the most difficult tasks handled by Human
Resource. Satisfaction is to each employee, it is owned and is impossible to have global
processes to ensure complete employee satisfaction. A job in satisfaction is identified in this case
during the job rotation when Ramesh was being transferred from a QA department where he has
worked for a long period to a production department. The employee expresses himself to the
management that he was doing well in the previous department and feels demoted with the new
department which is not at par with his credentials. A job rotation is meant to capacitate an
employee with variety skill known as job enrichment. The manner which the employee received
the message of transfer did not sank well with him, had no positive significance as he was not
involved in the decision. The new department also came with high targets difficult to attain. Yes
the company was running at a loss and needed new strategies, innovated and committed men
power, but still he felt was not support to come as surprise.
7

STATEMENT OF MAJOR PROBLEMS

The role of human resource manager is vital in any organization to attain its goals and for a
harmonious working environment. From the above discussion of identifying HRM problems
with the Asian Paints company, it is evident that there were lot of these problems inclined to
each other. As much as these problems were explored earlier, it is best to generate solutions of
the major ones and in the process the others will be automatically resolved as they are inclined.
In this discussion will concentrate on the solutions for organizational performance and
productivity, employer- employee conflict and the balance of employee quality of life and
productivity.

Organizational performance and productivity

Organizational performance and productivity is the main HRM challenge as discussed earlier.
This is because solemnly a reason for Business Company to exist is to maximize profit. In the
case this is not achieved there will be lot of problems in the Company like with Asian paints and
this is where the HRM comes in. The role of the HR function is to enable the organization to
achieve its objectives by taking initiatives and providing guidance and support on all matters
relating to its employees. The HR ensures that the organization develops HR strategies, policies
and practices that cater effectively for everything concerning the employment and development
of people, and the relationships that exist between management and the workforce. An HR who
fully understands this function can play a major part in the creation of an environment that
enables people to make the best use of their capacities and to realize their full potential to the
benefit of both the organization and workers.

In addition HR functions aim to achieve strategic integration and synergy in the development and
operation of HRM policies and employment practices. Strategic integration could be either
vertical or horizontal, vertical being the process of ensuring that HR strategies are integrated
with or „fit‟ business strategies. “The concept of coherence could be defined as horizontal
integration – the development of a mutually reinforcing and interrelated set of HR employment
and development policies and practices” ( Amstrong, 2006). HR forms part of management in
strategic planning, organizing, directing and controlling. It is within these stages that he/she
guides the company to achieve its goals, and have sustained performance and productivity.
Functions and roles of HRM in an organization are to increase the work efficiency, to maintain
the relationship between organizations and employees, To Stand on Competition and to make a
company exists in this competitive business world.

In terms of company expansion and venturing to diversity of productivity, HRM has to


participate in the change management plan act as a change agent, delivering organizational
transformation and culture change. Purcell (1999) as cited in Amstrong (2006) illuminates that
management should be much more sensitive to processes of organizational change and avoid
8

being trapped in the logic of rational choice. HR may be involved in initiating change and also
act as a stabilizing force in situations where change would be damaging as highlighted by
Mohrman and Lawler (1998). In the case of Asian paints performance and productivity of the
company dropped related to the change of expansion and diverse products, this is where the
change management strategy was supposed to come in. HR is in the right position to safeguard
both management and workers by making them understand the need for change, the importance
of their involvement and commitment to see through the change, the benefits of the change to
both parties and coping strategies towards the change, win the loyalty of both parties to the
company. Understanding and implementing all these will yield to a sustained organization and
minimize employer-employee problems.

Employer- employee conflict

Like it has been highlighted before in the discussion that HRM problems are inclined to each
other, good planning and implementation of HR strategies can minimize the conflicts between
the two parties. HR act as a shock absorber between the two parties and avoids taking sides by
ensuring loyalty, emotional attachment of employees to avoid staff turnover and conflicts such
that a third party like workers union will not cause more confusion and come in between the
employer and the employee. There are a variety of strategies could be implemented as solutions
to conflicts at work. “Conflict is defined as clash between hostile parties” (Gillies, 1989), was
assumed undesirable in the past. Today it is considered as a natural phenomenon that strengthens
an organization and resolving differences to bring about new change. The most common
solutions to conflict uses the soft approach HRM model implies avoidance, competition,
collaboration, accommodation, dominating and compromise. Each of these approaches
depending to the nature of conflict can be effective.

Starting with avoidance which is characterized by lack of assertive behavior and collaboration, It
is usually adopted when trivial issues are at stake, no chance of fulfilling personal desires and
people need to calm down first or obtain more information.

Accommodation approach is characterized by no self-assertion and collaboration. It is usually


adopted when other people‟s ideas seem to be better than yours, issue is far important to others
than it is to you and when accommodation builds up credit for the future. The approach is also
ideal when want to let others learn from their mistakes and when one wants to avoid enmity to
maintain harmonious relations.

Compromise is a fair measure of self- assertion and collaboration hence it is adopted when the
two parties feel it is necessary to reconcile naturally excluding goals. It also works well when
temporary solutions to complex issues have to be implemented and when conflicting goals are
only moderate important.
9

Lastly but not least the dominating approach which seems to fall under the hard HRM model and
power oriented. It requires that the dominating party to have sufficient power to force its
resolutions on the other party. It is effective in times of emergency when immediate action is
needed to save a situation like in term of retrenchment and dismissals.

“Procedural rules are intended to regulate conflict between the parties to collective bargaining,
and when their importance is emphasized, a premium is being placed on industrial peace…”(
Amstrong,2006). Collective bargaining can be regarded as an exchange relationship in which
wage–work bargains take place between employers and employees through the agency of a trade
union. The HR can aim at achieving satisfactory employment relationships, taking into
consideration the importance of psychological contracts, can form stable and cooperative
relationships with employees which can make them feel recognized as vital stakeholders in the
organization and minimize conflict. Ensure commitment through employee involvement and
communications processes, develop mutuality in achieving the organization‟s goals through the
development of organizational cultures based on shared values between management and
employees, involvement of trade unions to make them recognized and clarify industrial relations
processes with trade unions and build harmonious relationships with them on a partnership basis.

Involvement of the third party (union) can be another brilliant strategy to resolve conflict. These
include conciliation, arbitration and mediation.
Conciliation refers to an attempt to organize informal discussions which will enhance them to
reach their own agreement. In this regard the third party does not impose the settlement instead
the discussions will assist retain ownership of the resolution of the problem by the parties,
prompting the parties obligation with implementation.

With arbitration outsource or consult an independent third party (arbitrator) for deliberation of
the issues to come up with conclusive decision. The parties would have agreed in advance to
accept this decision and it will be final whether infavour or not in favour of any. a means of
finally resolving the matter.

Improving the employee quality of life

Every individual goes to work to meet his needs so that can be independent, satisfy his interest
and to gain power to control their own destinies Muller at al (2006). Balanced quality of life for
an employee takes into account the physical work environment safety, social environment within
organization work climate and the personal life which is life outside job. A well balanced
employee quality of life will contribute to affective commitment at work, job satisfaction,
increased performance, effectiveness and increased productivity thus an organization will meet
its targets, goals and maximize profit. Strategies to improve employee quality of life include
understanding benefits of packages, participatory management, management by objectives, job
enrichment.
10

Understanding the benefits of packages

Benefits of packages is a company strategy to take care of social responsibility for its employees.
These include, wellness programs, medical aid scheme, financial scheme, free snacks packages,
unlimited vacation time, flex time and commuter benefits. HR has to make employees
understand and appreciate these benefits that they are added on top of their salaries. Employees
need to understand that the employer is giving them on free will and will enable them to
maintain an acceptable standard of living while working in the institution. It is not always or
only salaries that can balance their quality of life.

Participatory management

This strategy decentralizes and delegates authority from top managers downward to the people
who report to them. “In doing so, objectives and duties are assigned, authority is granted, and an
obligation and responsibility are created by acceptance, the employee is thus accountable for
results ( Swansburg and Swansburg, 1999:422). This process increases motivation as the
employees are involve and made accountable.

Management by objectives (MBO)

It involves three psychological foundations, namely goal setting, feedback and participation. The
successful use of MBO depends on the ability of participants to define their objectives in terms
of their contributions to the total organization and to be able to accomplish them.

Job enrichment

Decisions/recommendations

The role of a company human resource personnel is vital than most people think. HR personnel
act as a moral compass which preserve company culture, oversee the employee‟s entire life cycle
while fkeeping the employees well trained, happy and productive, Organizational performance
and productivity, conflict management and improved or balanced employee quality of life
remain the key issues in sustaining an organization, HRM strategies concentrating on these key
issues in an organization will minimize problems, cultivate loyalty, build trust, create
commitment of employees and yield to the ultimate goal of an organization. A good
understanding of the ultimate goal of the company by HR, her functions and roles in the
organization of being part of management planning, organizing, directing and controlling, will
ensure company good performance and productivity. In reality best human resource solving
strategies involve good planning, vigilance in any risks or arising problems and managing
change.
11

In managing conflict the best strategies in this case could be collective bargaining and involving
the third party. This is because Collective bargaining is an exchange relationship in which wage–
work bargains take place between employers and employees through the agency of a trade union.
it aims at achieving satisfactory employment relationships, taking into consideration the
importance of psychological contracts, can form stable and cooperative relationships with
employees which can make them feel recognized as vital stakeholders in the organization and
minimize conflict. Collective bargaining ensures commitment through employee involvement
and communications processes, develop mutuality in achieving the organization‟s goals through
the development of organizational cultures based on shared values between management and
employees. It also involves trade unions to make them recognized and clarify industrial relations.

Involving the third party means inclusion of the union in discussions. This can be done through
conciliation and arbitration. In the case of Asian paints the two can be ideal. This is because
Conciliation allows organization of informal discussions which will enhance affected parties to
reach their own agreement. In this regard the third party does not impose the settlement instead
the discussions will assist retain ownership of the resolution of the problem by the parties,
prompting the parties obligation with implementation. In that sense the employees would accept
the interim of INR 75 than having nothing.

With arbitration the HR outsource or consult an independent third party (arbitrator) for
deliberation of the issues to come up with conclusive decision. The parties would have agreed in
advance to accept this decision and it will be final whether infavour or not in favour of any. a
means of finally resolving the matter. This would also help as there would be no favour and all
both sides deliberated independently.

To improve or balance the employee quality of life understanding the benefits of packages and
participatory management would be appropriate. This because the benefits are of free will do not
interfere with their salaries. Another thing the free wills would meet them halfway to maintain
the standard of living. Financial scheme would also prepare the employees for inflation as they
would have saved for the future.

Participatory management involves the employee in decision making, empowers them with
responsibility and task to finish. These would cultivate sense of recognition and create job
enlargement and job enrichment, empowering with more skills especially leadership.
Participatory management will also cultivate a sense of belonging (third stage) as highlighted by
Maslow in his hierarchy of needs theory, bringing loyalty and yielding to affective commitment
towards the company.

IMPLEMENTATION

Improving organizational performance and activity steps


12

1. Develop and implement high performance work practices, particularly those concerned
with job and work design, flexible working, resourcing employee development, reward,
and be employees advocate.
2. creation of a clear vision and set of values
3. ensuring a positive psychological contract and means of increasing the motivation and
commitment of employees;
4. design and implementation of policies that will meet the needs of individuals and create
conducive working environment
5. provide support and advice to line managers on their role in implementing HR policies
and practices;
6. Implement effective change management.

Managing conflictive through collective bargain

1. Preparing
2. Opening
3. Bargaining
4. Closing

Balancing employee quality of life and productivity

1. Package benefits (free snacks)


2. Part-time working
3. Care leave
4. Varying hours
5. Compassionate leave
6. Career breaks
7. Workplace counseling or stress management
8. Working from home
9. Flexi time
10. Term-time working
11. Help with child care in school holidays
13

References

Armstrong, M. (2006). A Handbook for Human Resource Management Practice. Tenth edition.
London: Kogan page.

Benzuidenhout,M,C. 2007. Managing for Healthy Labour Relations. Second edition.


Pretoria:Van Schaik.

Muller, M., Benzuidenhout, M., Jooste, K. 2006. Health Care Service Management. Cape Town: JUTA

Purcell, J, Kinnie, K, Hutchinson, Rayton, B and Swart, J (2003) People and Performance: How
people management impacts on organisational performance, CIPD, London

Ulrich, D., Brockbank, W. (2005). People Management, sixth edition. Wiley: New York