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The human resource management is crucial to any organization to be successful and have a good performance and profits in the organization, as employees’ satisfaction, their productivity help any company to achieve this and all of these depends on the HR practices in the company that keep employees’ motivated. Horwitz, F. (2017) studied the MNCs of South Africa for the organizational performance and the HRM practices, that are, performance management, diversity, training & development, and culture and these practices affect the performance. The conclusion is that they are an important part of the better performance of the organization and hence, need to be more focused on the HR management system for development and profits. A case study of an aircraft company ‘No Name’ profits are falling as the quality is falling of its products. Also, the share price is also falling which is putting the company at international risk. The headquarter of the company is in Australia and its subsidiaries in Singapore, China, and Vietnam, where China and Vietnam produce the parts of the aircraft, and Singapore and Australia assemble them. The designs are also done by Singapore.
The problems company is facing due to mismanagement of HR in majorly 4 areas, culture, and diversity (discussed in section 2), performance management, training & development (discussed in section 3). ‘No Name’ has not so good management of performance among the headquarters and its subsidiaries which is impacting the coordination and the performance as a result. Training and development are provided by HR are only according to the Australia company without considering the different working environments of its subsidiaries which makes time-taking for the employees to adjust in the different environments. Diversity matters in every organization, as it results in a good reputation of the company as well. 'No Name' has no excitement for the diverse culture, and not encouraging the different people to work in the company. This impacts the satisfaction of the employees and the reviews for the protentional employees of the company. The culture includes the beliefs of the company and the working environment and that totally depends on the human resource managers and its practices to make it satisfactory for the employees. The major finding is these factors are important and have to take some steps to improve it, human resource management should be more considerate about the employees and their performance to improve the organization’s performance and the profits, which will be further discussed in the conclusion and recommendations section.
The ‘No Name’ having some internal organizational problems which are making the culture of the company worse. As a result, the company’s reputation, profits, and shares’ value are going down. The organization at the hometown and its subsidiaries are having problems in coordination and people's beliefs. In personal, employees can have their own beliefs but for an organization to be successful, the employees should follow the same beliefs for the betterment of the company.
Human resource management is one of the important factors that affect the diversity and the culture of the organization and hence, the organization’s performance (Al-bahussin, S.A. & El-garaihy, W.H., 2013). According to Farndale, E. & Sanders, K. (2016) cultural values (tight/loose) affect the employees’ behavior and their HRM system. A concept of HRM system strength states the strengthening of the organization via better communication among employees and regarding the information, where the attribution theory comes into the picture, where the employees need clear and adequate information regarding work to work efficiently and not create any gaps. Also, the culture of the company is important for the working environment as well as for the potential competent employees to be a part of the company (Jabbour, C.J.C., 2011). HRM is a crucial part of maintaining a good working environment, as they make the strategies to maintain a good communication level among the employees. Raj, R. & Srivastava, K.B.L. (2013) states that learning and with a time-evolving attitude in the organization is the most important thing to maintain the organization’s culture, and innovativeness. Changing attitudes in HRM practices leads to a better culture, which leads to innovations and new skills.
‘No name’ has having several cultural issues, the employees are not communicating with each other, not providing sufficient information on their queries, people are having beliefs of not working as HR management is not good. The HRM system has to improve themselves by increasing the interaction among the employees, changing the working environment by coming up with some new ideas so that employees interact with each other among and across the teams. Managers have to be more interactive with their employees.
Diversity is every organization’s crucial part, as it binds the organization across the world with different people. Managing diversity is what keeps the diversity alive in an organization, any kind of discrimination (race, ethnicity, age, experience) hampers the working environment as well as the performance of the company. It is the HRM’s responsibility to prevent such kind of differentiation among employees in the organization. This will motivate and satisfy the employees to work and improve their retention in the company as well. This will improve the company’s reputation and profits.
Akinnusi, D.M., Sonubi, O.O. & Oyewunmi, A.E. (2017) states that HRM practices include the socio-cultural, economic, political, and legal ones. Diversity has 4 levels, personality, organizational, internal, and external that includes the varieties of the different cultures on which basis the diversity exists. The maintenance of the working environment along with the diversity is in the hands of the HRM, and for that, they should use the strategic approach and creative thinking such that each employee respects each other and have a friendly working environment. Abidi, O. et al. (2017) also pointed out that HR practices and diversity management policies are positively related, as better management of different background people results in changes in HR practices to bring harmony and discrimination prevention among the employees. HR efforts in pay, training, and other kind investments can bring a better diverse culture. Other approaches are social justice (where are legally get justice), affirmative actions (to bring gender equality by hiring an equal ratio), and providing legally equal opportunities.
'No Name' has several diversity issues where employees not ready to work with different age group people, with lower experience people, and many other reasons. One of the malpractices done by HR is not hiring the opportunities to the handicapped people which is ethically is unfair. This is affecting the performance of the organization as employees not happy working with each other.
Managing the performance of the employees is crucial for the better performance of the organization, and the maintenance of it depends on the HRM system, to keep employees motivated and satisfied with their jobs which will lead to profits in the organization. It is also necessary to keep the subsidiary companies to perform better, if there will be no coordination among the companies, the overall performance of the company will be impacted.
Adhikari, D.R. (2010) studied the Nepalese economy's open market economy to study the firm's competitiveness, performance, and development of employees and thee failed HRM and found that the HR is a crucial part to connect the company’s goals and the results by developing the human capital by creating a learning environment. Hope-Hailey, V. & Kelliher, C. (2009) found that the organization and the employees’ trust are the major links between the HRM practice of performance management and the employees’ commitment. The education sector has a strong and positive result regarding performance management systems. Decramer, A. et al (2013) found that there is a high consistency in the education system for performance management and higher satisfaction that is due to tight control among the employees. It also depends on other factors such as tenure, policies of universities, and so on. To improve the employees’ performance management, the managerial approach in the HRM system is also effective in the improvement of the performance (Neher, A. & Maley, J., 2019). Dr. Lottholz, P. & Dr. Billerbeck, S.V. (2019) report found that the gaps between the employees among the different levels of the organization also impacts the performance of the organization. They have done the mapping exercise at 3 IO levels and 5 key areas of performance management and concluded that at some levels the management is quite good, but on some levels, the gaps are still there and persistent. Also, the complexity of the organization’s level makes it difficult to study this qualitative nature of gaps in the levels.
Performance management in ‘No Name’ is awfully bad. The management in Australia for the same is properly done by HR, but there is poor management by the HRs at the subsidiaries level. International management among the headquarters and its subsidiaries is necessary for the company's success. Also, the company is not considering the economic factors and could use a managerial approach instead of an Ad-hoc approach, and tight and disciplined control among the employees. The coordination of the HRs and their management should also be supervised.
Training and development mean training the employees that lead to the development of the employees and the organization, which in turn leads to better performance and profits of the organization. Training and development are the responsibility of the HRM, in which the HRs have to take care of the needs and/or requirements of the skills in the organization. Also, it makes the new employees in the organization comfortable in their environment.
Jasim, S. S. showed that HRM practices such as training & development lead to significant positive results in satisfaction, motivation, retention, commitment, and presence among the employees. This in turn leads to improved profit, customer satisfaction, quality, productivity in the organization. Sriviboon, C. & Jermsittiparsert, K. (2019) has considered 3 HRM practices that are selection, compensation, and training and development, along with the significant role of HRM in the performance of Thai pharmaceuticals company. Also, used a resource-based theory that states that there are some resources that help to sustain the competitive advantage of the organization, and the social capital theory that states the relationship between performances and the practices. HRM saves time and costs for the organization to keep a competitive advantage. (Zeebaree, S.RM. et al, 2019). Companies are adopting E-HRM which helps the HRs to make decisions and help them to manage the activities of the organization. Digital HRM is also helping the companies to become more competitive (Dr. Fenech, R. et al, 2019). Presbitero, A. (2017) studied the impact of HRM practices (rewards and training and development) in hospitality and tourism and proves that there is a positive and significant impact on employees’ engagement of these practices.
From the case study, it can be clearly seen that 'No Name' HRs are not providing any training and development to its new as well as existing employees, which affects their productivity as it takes time for them to adjust to the new working environment. HR is asking the assumption that the employees who are moving to subsidiaries need no different training and the resources that are used in headquarters, also used in its subsidiaries. HRs also not taking feedbacks for any improvements in training. The seniors of the company are also not getting engage with its juniors because of fear of increasing competition for their promotions which is creating gaps between senior and junior levels’ employees.
Organizational HRM system is a necessary part for an organization to have high profits and human resource management practices help to achieve this goal. The employees' motivation, satisfaction, and performance depend on the practices of the HRs that they do in the organizations, which in turn impact the performance and the profits of the company. From the given case study, we have concluded that the main 4 areas, performance management, culture, diversity, and the training and development are not in a good shape and requires improvement in the HR management system to improve the position of the company in the market, as thee poor performance in these areas impacting the production and the quality of the aircraft and reducing the customer satisfaction level. Using the research papers and referencing, the conclusion is that HR management and practices are crucial to the company. Also, they have to evolve with time to indulge more with the employees and keeping the working environment lively. It can also be noticed that all these 4 areas are inter-related and all these 4 lies within each other and results in the same goal of better performance of the organization by improving the employees’ motivation and their satisfaction.
It can be noticed that the culture (rules and regulations) results in diversity in the organization, and vice versa, as diversity, brings adjustment in rules and regulations in the organization as per the requirements. Training and development result in better performance, though the training and development and performance management are specifically coming under HR as culture and diversity also depend on the employees and the organization rules. Under culture, the interactions among the employees need improvement which in turn impacts the diversity of the company which is an important aspect for the company (Bakhri, S. et al, 2018). Also, the different approaches should be followed such as legal practices, creative approach, and so on to bring diversity. For performance management, employees’ attitude towards the company also affects the company’s performance that can be brought by some tight control over the employees. Training and development are also important to enhance the skills and satisfaction of the employees for the better performance of the company.
Factors in the study case that could also make the impact are the competitors as a fall in profits may be due to the better performance in the organization, lack of innovations, pay issues to the employees, and so on. The organization is only focusing on these 4 areas on a very broader aspect and should do the deeper research to know the actual facts, as the performance, training, and diversity due to the gaps among the seniors and junior levels as well, also that diversity considers the different aspects, though the study has evaluated that HR didn’t hire the handicap people irrespective of their skills, some further study could be done on that. Though the major key areas for HRM are these 4, apart from, within the HR there could be mismanagement because of which they are unable to perform better in these 4 areas.
It would be suggested that there should be some supervision and some feedbacks on regular intervals for the employees including the HRM to improve the organization. Also, need to adapt to the learning and creativity approach. The HRM should evolve by bringing the digital HR system to make their management easy, as some papers have concluded in the positive results of the same. On intervals have some activities for the employees to know each other more and bring the interaction among the employees of the different countries as well, to eliminate the commination and coordination gaps.
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