This assignment will analyses the business environment that the Jaguar Land Rover organization is operating in, and identify and examine the internal and external forces that affect the company approach to Human Resource Management (HARM). It will offer suggestions as to how changes in their HARM methodology have helped to maintain and/or improve business performance, focusing on how Jar’s recruitment, and retention policies underpin their approach to HARM, and how they have allowed the organization to overcome adversity and gain competitive edge in the automotive industry.
Tyson (201 2, p. 62) explains that from the period of the 1 ass’s to the mid sass’s, the specialist occupation tasked with the management of people was known as ‘personnel management’. French defines personnel management “The recruitment, selection, development and utilization of, and accommodation to human resources by organizations. ” (French 1978, p. 3. Cited by Tyson 2012, p. 62).
It is a common school of thought (Armstrong 2012, Touring et al 2011 ) that the concept of ‘human resource management’ began to emerge from the USA in the mid sass’s thanks to the work of American academics such as Michael Beer and Charles Bombproof, and their ‘Harvard framework’. Touring explains that HARM is more contemporary approach to handling the staff functions of an organization than personnel management, and that it relies n putting policies in place that support each other and reinforce the overall business strategies of on organization.
Traditional personnel management is more often linked with autocratic management, where an organization has clear rules and procedures for staff to follow. Conversely, HARM is more strategic in its approach, and uses more sophisticated methods of management designed to nurture and get the most from individuals. By involving staff and gaining their commitment, the expectation is that it will create a motivated workforce that understands the strategic aims and shares he core values of the organization, which will in turn generate a competitive advantage.
Storey states that HARM is: A didst incentive approach to employment management which seeks to achieve competitive advantage through the strategic deployment of a highly committed and capable workforce, using an array of cultural, structural and personnel techniques. ” (Storey 2007, p. 7. Cited by Farewell & Clayton 201 0, Jaguar Land Rover (JELL) is a British company that was founded when Data Motors, an Indian automotive manufacturing company, purchased the iconic, premium Jaguar and Land Rover brands from Ford in 2008.
PESTLE analysis as conducted in order to assess the macro environment in which JELL operate (Appendix 1 PESTLE analysis allows an organization to comprehend the political, economic, social, technological, environmental and legal forces that affect the market and may have implications for the business. It allows an organization to develop strategies to deal with any changes in the market. Johnson et al (2009) states: “Future trends and requirements for change based on these trends can be identified through this analytical tool. (Johnson et al 2009, p. 25). SOOT analysis was conducted in order to assess the micro environment in in which JELL operate (Appendix 2). SOOT analysis is used by businesses to examine the internal factors that affect the business by identifying its strengths, weaknesses, threats and opportunities. Despite struggling under the ownership of Ford, JELL has undergone somewhat of a renaissance under its new owners, and the businesses performance has improved vastly. JELL state: “Revenues rose 17% to El 5. Billion, while underlying earnings jumped by 19% to ?2. 4 billion, representing a return on sales margin of 15. 2%. Pre-tax profits rose to El . 67 billion with free scofflaws of IEEE million. ” LOUR 201 3, This is in spite of the parent company suffering elsewhere in the automotive market. In fact]Ghanaian (2014) explains that if it wasn’t for dividends from JELL, the profits of the mother company before tax would have been negative, and that it is more than likely that JELL will be driving Data Motors for the foreseeable future.
The successful performance of the JELL operation can be attributed in large parts to the implementation of HARM processes that underpin the strategies of the organization. It could be argued that the catalyst for the upturn in the fortunes of JELL was the retraining of all 1 500 of its management staff from rent line to board room level in 2008. Changes in ownership (the company had also been owned by BMW), coupled with the global economic crisis necessitated a change in the culture of the organization.
Whereas personnel management is based on compliance, HARM theories work on the premise that each individual is committed to the cause and buys into the strategic aims and core values of its employers. For this reason these aims and values must be clearly defined. The Human Resource Management International Digest journal (201 1) explains that this was problematic for a company which had en derived from separate companies and existed under different owners.
It was for this reason then that the ownership took the measures employ learning and development specialist Ashore Hill to develop a accompanied performance management program. The Hick and Upton explains: “This initiative was to underpin the launch of their new behavior framework and performance management process designed to increase the pace of organizational change to meet competitive market demands. ” (Hick and Upton 201 0, p. 247). The 2012/2013 JAR annual report identified several of the brands core values:
Commitment to innovation quality and collaboration Commitment to sustainable growth Exceeding customer expectation and delivering outstanding customer experience Engaging our people, customers and partners Delivering new and refreshed products driven by advanced sustainable technologies Introducing these and other core values to 1 500 of the company’s management however would not be enough to change the entire beliefs and behavioral framework of a company that employs 29,000 employees worldwide, and there would have to be a way to spread the new framework throughout the entire workforce of JELL.
Hick and Upton go on to explain that the training programmer not only developed the managers’ knowledge of the framework and functional details of performance management, but also improved their ability to engage with their employees and instill the same set of beliefs within the workforce: “Alongside these objectives it was also important that the program generated a new alignment in business thinking and instilled an impetus for driving transformational change across the organization.
This performance management program is therefore inextricably linked to the new business vision, and its success will be critical to the future success of Jaguar Land Rover. ” (Hick and Upton 201 0, p. 248). Armstrong (201 2, p. 256) explains that talent management is the process Of ensuring a company has all the talented people it requires to attain its business goals. Recruitment and selection plays a vital role in this. As Touring et al (201 1) states: “There is always a need for replacement employees and those with new skills that business growth or change make necessary. (Touring et al 201 1). This is particularly the case for a company in an ever changing, rapidly developing industry such as car manufacturing, and as such recruitment is en HARM function within JELL that has an extremely proactive and strategic approach. Job Test Prep (2014) explain Thatcher have a rigorous recruitment policy that involves an application form and situational judgment test various psychometric tests, presentations and group and role play exercises.
Whereas dated personnel management was focused more on how well an individual could do specific task, HARM places more importance that the individual not only has the required academic and physical attributes, but also that their personality and mentality will fit into the behavioral remark of the organization, and that they will share the core JELL values. The ‘high performance behaviors’ Thatcher look for in the recruitment process are: Strong teams: Having the ability to support and contribute to the work of the team.
Effective relationships: To be able to help the company grow, you cannot do it on your own so you have to demonstrate the ability to get along with people who share a common goal. Efficient delivery: This means being able to structure tasks in a way to be completed on time and within budget without compromising on quality. Agility and flexibility: You eve to show creativity and innovation in a constantly changing world. Clear direction: Showing that you have the drive and ambition to take the company forward.
High performance: Showing that you are always striving to improve and show belief in the company vision. (Job Test prep 2014). Setting such a high standard for new recruits presents problems however, and as SOOT analysis identified, a potential threat to JELL was a shortage of skilled engineers. A shortage of skilled workers could threaten the company’s ability to meet capacity demand for its vehicles should demand increase.
Off ND Murray Brown of the Financial Times state: “A surge in demand for British engineers by carmakers is exposing the chronic skills-shortage threatening the future growth of the UK supply chain. ” (Off and Murray Brown 2013). As JELL (2013) explains that partnerships with universities, colleges and specialist trainers have been created with an emphasis on delivering technical and academic skills through industry leading to ensure that this doesn’t happen. Furthermore, JELL are also well known for their graduate and apprenticeship schemes, as they look to employ the best possible talent available.
Off and Murray Brown (2013) explain that children as young as nine are being encouraged by JELL to pursue a career in engineering, a drastic step, but one they hope will prevent them moving more of their manufacturing overseas. Additional innovative ideas such as beginning a specific personal development programmer for women (who currently only account for 18% of the graduate intake and 8% of apprentices), reinforce Slur’s modern and sophisticated approach to recruitment One negative fjords efficient recruitment policy is the knock on effect it might have on the rest of the Auk’s manufacturing industry.
With JELL looking to recruit the best home grown engineers, there is a fear that core engineering staff from suppliers will leave to work for JELL for all the benefits that working for a global company brings, creating a large skills shortage in the supply chain, and potentially forcing many smaller companies out of business. This is an area of great concern for the UK government as they look to rebalanced the economy and place less emphasis on finance and more on manufacturing. It is one thing being able to recruit the best staff, but quite another to keep them happy and retain them.
With the financial and time costs of the acquirement process being so high, as well as the aforementioned shortage of skilled engineers, it is absolutely imperative that JELL keep hold of its best talent in order to maintain a competitive advantage. JELL acknowledge the importance of its staff: “Our greatest asset is our people, nothing is more important than their well-being. ” (JELL 2014, p. 16). In order to ensure a high morale amongst the work force, employers need to be aware of their employees’ other motivational factors. Armstrong (201 2, p. 82) explains that motivation is a complex theory involving extrinsic and intrinsic motivation. Extrinsic motivation is defined as when things are done to or for employees including rewards such as incentives, pay rises, promotion and alternatively punishments including disciplinary action and criticism. Intrinsic motivation on the other hand is related to the work itself, and is linked to employee engagement. Personnel management and early control and command management theory has in the past argued that workers are motivated by extrinsic factors, specifically financial rewards. Armstrong (201 2, p. 84) explains that Taylor (191 1) had a school of thought whereby motivation was dependent on rewards and punishment being erectly related to performance. Armstrong also explains that Moscow (1954) and Alder (1972) developed theories whereby the motivation of employees was related to their needs. As J_R are employing highly skilled and intelligent workers, it is likely that the factors that drive their motivation are complex and various. However it is a function of the HARM department to identify these needs and deliver them to keep the work force highly motivated, highly productive, and away from the clutches of rival firms.
JELL identifies that employees sometimes want challenges such as developing their own skills ND trying new roles, and this is something it is happy to facilitate with training in order to maintain the wellbeing of its employees and retain the best talent. One initiative Thatcher has put in place is allowing staff members to bring family members in to work to test drive cars. JELL identifies that if a staff member is happy in their job that they will be more productive, and likely to stay with the company for a longer period of time.
As mentioned earlier, JELL have clearly defined core values and strategies that are fed down throughout the hierarchy. Sharing these values with the staff and encouraging them to strive for the completion of the goals and objectives is linked to keeping them engaged and motivated. Sharing further information regarding the workings of an organization can further engage employees. Cushman states: “Transparency isn’t just a matter of PR; more importantly, it can also be a significant driver of productivity, as business clarity can bring a greater sense of ownership and meaning to staff.
Giving people clarity about the value of their work and the impact that it has on the rest of the business gives them a greater sense of purpose. ” (Cushman 2014). JELL explain that regular communication with their staff is key to their relationships with them and allows the employees to form loyalty towards the company: “This emotional attachment to the company is nurtured and reinforced through regular communication and a commitment to working in partnership with employees and their representatives to deal with challenges. ” (JELL 2013, p. 80).
The Porter and Lawyer motivation model (Appendix 3) illustrates that motivation alone however is not a guarantee of performance. Ability and role expectations are also required in order to ensure high performance. Human Resource Management is a complex and function of an organization that performs many important roles, and underpins the strategic goals of the business. Rather than being solely responsible for controlling human resources, it is accountable for the employment and the development of people in a strategic manner that will enable the company to achieve its aims and objectives.
The HARM when it is implemented correctly can vastly improve the efficiency and maximize the output of an organization. Jaguar Land Rover as an organization has embraced HARM, and used it to improve business performance since 2008. The organization identified a need to improve its culture and develop flatter structures between management and staff, which has led to greater sense of purpose from employees as they feel involved with decision making processes.
Despite the retraining of the management no doubt having a large financial cost, it was merely an investment in the strategic goals of the organization, and JELL are now reaping the rewards of refining internal communication and improving the productivity of its work force. Despite their forward thinking and innovative approach to recruitment, the fundamental problem with Slur’s core value that ‘commitment to sustainable growth,’ is that the company may well have become a victim of its own success, and it may not be able to meet increasing demand.
Globalization however could be the answer to these problems. The solution it seems would be to continue moving into different global markets with growing economies, and manufacturing vehicles in other countries and there are skilled engineers in abundance and labor costs may also be lower such as Asia and India. Despite being competitive and prosperous at the present time, JELL must continue to be aware of changes in the market, as the industry hey are in is hypersensitive and prone to change.