Planning for Employee
Resources and Profits
Elizabeth Dehn
Minnesota School of
Business
Professor Craig
Morris
5/27/2014
Abstract
The human resources of an organization are the strongest
asset that most firms possess. The balance necessary to compensate these
employees appropriately while maintaining a profit-focus is one of the most
difficult tightropes in business. Therefore, you must develop a Human Capital
Management Plan that builds upon the newest financial goals and utilizes modest
yet modern values and structure to ensure that the strengths of the business
increase along with the loyalty of its strongest asset, the employees and
stakeholders. The people. This paradox can be easily navigated by combining a
cocktail of the organizational goals with a conservative yet engaging employee
management plan. As per this case study regarding XYZ Company, I will describe
in detail my suggestions for Mary James’ plan to be a team player yet preserve
and engage the loyalty and legacy created by her and her kin.
Table of
Contents
Planning for Employee
Resources and Profits
Introduction
In this case study I think that the
HR manager and stake holders of the firm need to create an opportunity for a
win-win situation. (Thenor-Martin, 2013) The HR manager Mary
James can create a Human Capital Management (HCM)[1] Plan that will reduce
costs yet foster sustainable growth by strategically nurturing existing loyalty
and legacy of XYZ Company yet still reducing HCM overhead. In analyzing the ethical
issues at hand for what makes an employee happy yet showing the financial
benefits of creating conservative and modern objectives, I conclude that these
goals are complimentary and should be considered necessary in creating
exponential profits. The goal is to fulfill the needs for more profits and cash
flows, yet support employee engagement and investment so that strong growth is
fostered and sustainable.
Profits versus Overhead
Treating employees well and
increasing engagement investment in turn increases employee loyalty and
therefore reduces costs in HR. This is because it takes quite a bit of money
these days to scout, interview, hire, train, and onboard an employee. Not
everyone agrees with this opinion yet there are increasing studies in this
area. I understand the stake holder’s position in this scenario of wanting to increase
cash flow and meet expansion goals (Thenor-Martin, 2013) . I think that XYZ Company
should foster the loyalty it has by narrowing in on top talent and analyzing
the big picture regarding organizational goals. Top talent would include some that are already
in leadership but would also include an analysis of the highest producers and
new talent with vision. This can still accomplish the goal of increasing
profits.
Some of the biggest mistakes that
American industries have made per our text on page 536 include, “too much
emphasis on short-term profits and too little on long-term planning. [..and]
too little emphasis on quality and continuous improvement.” (Goree, Manias, & Till, 2011) Increasing profits cannot just be about
decreasing costs. When there is a direct correlation between the ‘happiness’
and productivity of a firm, there then needs to be the proper investment in
fostering that growth.
Engagement for Profits
An ‘awesome’ work environment has
college graduates falling over themselves to work for companies that are fun.
Insight Global has 1,255 reviews on Glassdoor.com with an average rating of 4.4
out of 5 stars from employees. A startling 90% of employees would recommend this
company to a friend. By reading further into the reviews I see that the senior
management, career opportunities, and employee satisfaction receive great marks
from most. (glassdoor.com, 2014)
Per Human Resources Magazine, “higher
levels of employee engagement lead to higher sales revenues and profits.” (Minchington,
2011)
This article goes on to describe an effort on behalf of Sears to increase this
engagement and measure any increase or decrease in profits per that investment.
“Sears found that a five percent increase in employee satisfaction drives a 1.3
percent increase in customer satisfaction, which results in a 0.5 increase in
revenue growth.” (Minchington, 2011) Companies need to
balance desired outcome between modest and conservatively-designed overhead
objectives while increasing opportunities to engage and sustain happy
employees.
Minchington makes a compelling
call-to-action: “Shift your talent attraction strategy, […] allocate sufficient
resources to develop and implement an employer brand strategy […] communicate
and seek feedback from new hires, […] consider the full life cycle stages of an
employee’s tenure and develop engagement strategies which are most appropriate
for the stage.” (Minchington, 2011) These objectives can
have exponentially larger benefits than the investment. Designing a life cycle
of the position and tailoring to create mentorships and other engagement
opportunities can greatly strengthen a team and have compounding benefits.
Summary Analysis of Case Study
The main
issue at hand here is that Mary James is the HR Director of a firm that has
been overtaken by new owners who want to drastically change compensation
procedures and employee percentages to reduce overhead and therefore increase
profits and cash flow of the XYZ Company. While Mrs. James has many relatives
who previously worked for the business, she is expected to be a ‘team-player’
and create a plan that will satisfy the stakeholders. (Thenor-Martin, 2013) She is ethically
conflicted because she knows although it is legal for them to implement the
changes, it could drastically change the work environment, employee
satisfaction rate, and engagement level of the company she has worked at for 30
years.
Per the
research and situations outlined in my analysis, I conclude that employee
engagement/satisfaction should be appropriately fostered regardless of the size
of your budget or interest in profits. When employee engagement is fostered and
employees are happy, they work harder and are more loyal, which in-turn
sustains exponential increases in profits! The following section is an outline
and plan for Mary to enact in efforts to create a win-win scenario for this new
ownership situation.
Plan for Human Capital Management
Mary James
should create a presentation that clearly outlines her plan with a timeline and
chart projecting the figures she thinks are realistic and will meet the
organizations goals. Below is a proposed outline for her presentation and plan:
v
Introduction/Call to Action/Intent Statements:
Mary James should create a strong introduction discussing the accolades of the
business under past ownership, the current goals as described to her months ago
from the new stake holders, and an intent statement making it clear that she
feels her plan delivers on all levels yet is flexible per their suggestions.
v
Plan: The plan itself must include enacting and
creating a timeline for implementation of some of the suggestions from the list
of requests she received. Specifically,
Step One – Analyze Talent and Organizational Long-Term Goals. Match the
long-term goals and positions for top talent and evaluate current workforce to
determine where the superstars and promising employees are and where they
should go to optimize organizational effectiveness and strength.
Step Two – Design a HCM budget that allows for reduced compensation in
most benefit categories and lower introductory wages yet still provides for
optional investment opportunities and employee engagement. For this part of
Mary’s presentation, having visual aids to communicate the proposed HCM budget
that clearly show the reduction in cost and fostering of assets will be
essential.
Step Three – Re-Brand the organization with a new Mission Statement,
performance-based bonuses, and an employee engagement program that not only
zeroes in on the employee and position, but also allocates for the employee
life-cycle, which will foster continued loyalty and growth in the workforce and
therefore increase effectiveness and profits.
v
Summary/Closing/Offering: In Mary James’
summary, closing, and offering; she must create a synopsis of the
research-based plan that she has created to reduce overhead with regards to HCM
while fostering new goals to increase engagement, employee loyalty, cash flows,
and profits. She should have the goal to create a no-pressure call-to-action
for the stakeholders that will help them to genuinely consider her plan to
foster current assets to the best abilities of XYZ Company. I think it would be
wise for her to mention timeline, implementation, and flexibility so that her
plan is realistic, easy to visualize and plausible to enact. Utilizing
resources to back up her interest in fostering employee satisfaction will go a
long way with stakeholders and combined with a conservative yet creative
budget, could easily create the win-win that everyone desires.
Conclusion
Per Mina Brown of Positive Coach LLC, there are seven key
leadership objectives that focus on increasing engagement and support retention
of super-star and instrumental employees: “Cultivate high trust,
Model core values, Encourage debate and risk-taking, Listen, really listen,
Leverage strengths-Mitigate weaknesses, be savvy about
organizational nuances, and lastly Imagining the future.” (Positive
Coach LLC Mina Brown)
Fostering these goals and objectives while balancing a
conservative yet creative HCM budget will ensure that the organization is on a
path towards success. The issue of fostering existing employee loyalty while
igniting the fire for future inspiration and innovation from employees lies in
creating an engaging atmosphere where employees are satisfied yet also buy-in
with the organizations goals for profits and success. This balance might be one
of the most difficult to maintain in the business world but mastery of it is
magical for a firm.
References
Brown, M. (2014, Feb). Leadership Strategies - Seven
leadership strategies that improve engagement. HR Strategy and Planning
Excellence presented by HR.com, pp. 20-21. Retrieved May 15, 2014, from
HR.com:
http://www.hr.com/en/topleaders/interactive_content/hr-strategy-and-planning-excellence-essentials-feb_hsc7aorn.html
glassdoor.com. (2014, May 27). Reviews for
Insights Global. Retrieved May 10, 2014, from glassdoor.com employment
website: http://www.glassdoor.com/Reviews/Insight-Global-Reviews-E152783.htm
Goree, K., Manias, N., & Till, J. E. (2011). Ethics
Applied (6th Globe Education Network ed.). Pearson Education.
HR.com. (2014). HR Strategy and Planning
Excellence Issues List. Retrieved May 05, 2014, from HR.com:
http://www.hr.com/en/topleaders/essentials/hr_strategy_planning_excellence/
Kataria, A., Rastogi, R., & Gary, P. (2013).
Organizational Effectiveness as a Function of Employee Engagement. South
Asian Journal of Management, 20(4), pp. 56-73.
McKinney, R. (2014, Mar). Why Does Succession
Planning Go Off the Rails? HR Strategy and Planning Excellesnce presented
by HR.com, pp. 16-17. Retrieved May 12, 2014, from
http://www.hr.com/en/topleaders/interactive_content/hr-strategy-and-planning-excellence-essentials-mar_hta9ln2p.html
Minchington, B. (2011). The Profits Versus
Engagement Paradox. Human Resources Magazine, 15(6), pp. 32-33.
Positive Coach LLC Mina Brown. (n.d.). Engagement
and Retention. Retrieved May 17, 2014, from
http://www.positivecoach.com/pdf/employee-engagement-and-retention.pdf#sthash.fRmw7mfc.dpuf
Thenor-Martin, A. (2013). Case Study in Ethics:
Human Resources. Richfield: Globe Education Network.
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