International Human Resource Management At Iceland Business Essay

Current business changes have also led to difference in viewpoint and opinion of strategists who now believe that HRM and Personnel management are two completely different scenarios where HRM is a broader concept mainly responsible for managing a large number of manpower for efficient working of the firm. On the contrary Personnel management is more inclined towards supervision and administration related to payroll and legal scenarios of labour employment.

Looking at the working environment of Iceland and other food companies, the difference between personnel management and human resources is quite clear. In the sense that, Human resource management of Iceland encompasses and promotes personnel management tasks and also develops and groom the workforce for attaining maximum efficiency and improving the working of the organization. As personnel management is reactive, human resource management is proactive, involving a holistic approach to continuous development of employee skills to handle personnel related tasks and activities

A major difference between the two lies in the fact that personnel management is responsible for employee satisfaction which is realized through incentives , bonuses, rewards etc whereas HRM practice in the firm works on the ground that enhanced performance of employees through challenging work, job creativity etc leads to employee satisfaction.

HR Specialist’s Role and Responsibilities

HR specialists are quite influential and have a unique role in managing the human workforce of the firm. Iceland too recognizes the importance of a HR specialist who is mainly responsible to attain and extract the maximum potential and capacity through the firm’s human workforce.

They are involved in functions of staffing, training and development, labor relations etc. on the whole a HR strategists role can be categorized under three main heads, the strategic process, the legal aspects and the operational aspects (Carolyn W, 1992).

Under strategic process, HR specialists are involved in:

Strategic planning

They perform the role of a consultant who advices the management in all key areas

A diagnostician who identifies the various loopholes and recommends necessary action for the same

innovator/change agent who implements the dynamic changes in the corporate practices of the firm

A catalyst who triggers the positive areas of business

A cost manager who minimizes cost and maximizes returns.

Under legal process, HR specialist performs the role of:

Auditor/controller who assesses the company’s personnel policies and strategies

A consultant who advices the company on personnel matters and issues related to employment laws and other areas

A conciliator who acts as a peace maker and negotiator for resolving conflicts and issues arising between different employees and existing workforce (Carolyn W, 1992).

From operational perspective, HR specialist

Deals with handling daily operations such as staffing, compensation, appraisal, rewards etc

Interface between employees and management regarding the framing of employee policies and procedures

Coordinating and motivating employees (Carolyn W, 1992).

1.3 Line Managers are Responsible to Manage People at Work

Line managers have a special role to play in managing people as they reside in the lower layers of management hierarchy and deal with people who have no obligation or any sort of managerial responsibility (Hutchinson S HYPERLINK “http://www.cipd.co.uk/research/_bringpolstolife.htm”&HYPERLINK “http://www.cipd.co.uk/research/_bringpolstolife.htm” Purcell J, 2003). Line managers execute a critical role in implementing HR policies and strategies. Their role revolves around:

Managing people effectively

Minimizing operational costs to maximum possible extent

Extending and forwarding technical advice and guidance

Assigning work and allocating tasks

Continuous monitoring and supervising work

Detect errors and take prompt corrective actions

Handling customers effectively

Setting standards for measuring operational performance of the firm

When it comes to managing people effectively, line managers perform vital functions such as

Performance appraisal of employees

Imparting training and counselling to new recruits and existing workforce

Maintaining proper communication and employee involvement

Maintaining work life balance etc

Giving due recognition to employees (HYPERLINK “http://www.cipd.co.uk/research/_bringpolstolife.htm”Hutchinson S HYPERLINK “http://www.cipd.co.uk/research/_bringpolstolife.htm”&HYPERLINK “http://www.cipd.co.uk/research/_bringpolstolife.htm” Purcell J, 2003)

Thus well managed front line managers help in leading high productive and high performing workforce. It is the organizations and senior management responsibility to promote and support capable and efficient line managers by clearly drafting their role and responsibility.

RECRUITMENT AND SELECTION PROCESS

Human Resource Planning Process in Iceland

Iceland being one of the renowned frozen food chains depends a lot on the human resource department which is well managed through s systematic human resources planning process that helps in anticipating the end results of the applied business strategy in regard to the firm human resources. The HR planning also involves the need of required workforce with special skill and competencies to perform the necessary tasks and activities.

The Iceland human resource planning process involves the following steps:

Analyzing the already existing organizational plans

Secondly to forecast the demand of the total headcounts required in the firm

Then forecasting the supply, that is obtaining data about current human resource present in the market and future changes

Fourthly, the net human resource requirements are finalized considering all the departments of the firm

After which, the deployments, retrenchments etc are taken into consideration and future demand is planned

In case future deficits are confronted, reference plans are also chalked out.

Lastly, the plan to modify and adjust the organizational plan in accordance with the market changes is also taken into account.

Analysis

After analyzing the human resource planning process of Iceland Company, it can be deducted that the information system regarding human resources is still inadequate. The internal deficiencies are well accounted for but the external market changes are not acknowledged such as the labour market, the current trends in human resources etc are not well adapted into the human resource system. Thus, the global perspective needs to be included in the entire process for giving the procedure a holistic view.

The stages involved in the planning process in Iceland consist of:

2.2 Link Between Human Resource Planning and Organization Structured Process.

The human resource planning of the firm has a deep impact on the structure of the organization, the needed information and the three stages including strategic, intermediate and operational levels of the planning process in various forms which involve:

Organization’s work culture is affected if things are taken in a casual and unsystematic manner such as a distance is created between the key decision makers and the workforce, secondly senior management no more remains trustworthy, reduces the contribution from the workforce in terms of creativity, risk taking, new talent is reluctant to be a part of the company, the image of the company is hindered, infact the entire process is impeded.

The human resource succession planning is affected which may further lead to improper promotions or demotions, team evaluation, inappropriate performance reviews leads to hindered employee development etc.

The operation costs are intensely affected by human resource decisions such as high turnover cost, replacement cost, slack time , hampered motivation, restructuring of employee cost, health cost , increase in insurance costs etc

Ultimately the workforce is affected which in turn

has an impact on the organization’s working and performance such as reduced productivity, sub standard customer service quality etc.

2.3 Interview Selection Technique Evaluation

Most of the organizations depend mainly on the interview technique to select the required workforce. Iceland is also one of them where potential candidates are screened and selected by conducting various interviews at different stages of selection process. Iceland is now the only food retailer recognized among the best 25 companies of UK having more than 200 stores running in different countries. Such wide network requires huge labour that is selected after conducting various interviews such as:

Preliminary interview

Core interview

Decision Making Interview

Various levels of interviewing help the organization to extract the best talent from the market as the initial rounds help to better general interaction with the candidate and judge his suitability for the job. Many candidates who are not suitable for the organization and its work culture are eliminated right in the beginning of the process that saves a considerable amount of time and cost to the company.

Selection by Invitation: one of the methods of selection could be inviting the key executives of competitors by constantly observing their performance and offering them attractive incentives and benefits. Such technique helps in saving tremendous cost and time to the company and attracting the best and experienced candidates.

Leasing: Company may benefit by leasing that is employee expert and depute the employees to the needy companies on a lease basis. In regard to which the leasing company charges a reasonable amount. Such kind of activity helps the organization to utilize the resources in the best optimum manner and select candidates as and when required without much hassles.

360° Selection Programme: Involvement of subordinates, employees working at the same level of job are better in determining the skills, knowledge and performance of potential candidates as they are accustomed and tuned to the specific job environment. A 360° appraisal is the best fit between the job and the candidate and at the same time lessens the burden of the superior administrators as well.

Thus the above procedure and techniques can help Iceland to put into practice a rigorous and dynamic selection process for attracting the best talent within the organization.

The core interviewing is conducted for potential candidates where major emphasis lie on stress interview and probing technique as the candidates are required to deal with customers of various nature and temperament. Depth interviews are also considered where special skills of candidates are examined by judging critical answers to posed questions. Such drilling exercise helps in understanding the mental capacity of individual to handle stress and intense situations. The candidates behaviour during the interview process is a good criteria to determine his reasoning and analytical abilities.

Finally the decision making or the final interview is conducted whereby the top authorities or managers examine the interest level of the candidates for the job and find about his acceptance and decide whether to select the candidate or not.

Iceland’s interviewing process is rigorous and in-depth which eliminates the changes of wrong decisions and adding extra cost to the company. Various aspects of interviewing are taken into account which renders the entire process a structured approach. The company is able to select the best pool of talent through its own skills and capabilities.

Alternative methods of selection

Thus the above procedure and techniques can help Iceland to put into practice a rigorous and dynamic selection process for attracting the best talent within the organization.

2.4 Recruitment and Selection Process of Iceland

Iceland is regarded to be one of the highest rated among the big companies to hire the best talent available and provide complete staff satisfaction like pay and benefits. The practices and procedures adopted in the selection process by the company are best taking into perspective the legal framework as well. The recruitment and selection procedures of the firm comply with the IPCC’s diversity policy which includes the requirement of the following acts:

The Sex Discrimination Act, 1975

The Race Relation Act, (1976, 2003)

The disability Discrimination Act, 1995

The Employment Equality(Sexual Orientation) Regulation, 2003

The Employment Equality (Religion or Belief) Regulation, 2003 (IPCC, retrieved on 17th September, 2010)

All interviews are conducted by authorized panel who design competency based questions. Proper pre and post arrangements for interviews are made and decisions for appointment are based on the content, qualification, performance and the right to work norms in the UK (IPCC, retrieved on 17HYPERLINK “http://docs.google.com/viewer?a=v&q=cache:ZzAuwNGdp24J:www.ipcc.gov.uk/foi/agreed_recruitment_and_selection_policy-4.pdf+legal+requirements+of+selection+in+UK&hl”thHYPERLINK “http://docs.google.com/viewer?a=v&q=cache:ZzAuwNGdp24J:www.ipcc.gov.uk/foi/agreed_recruitment_and_selection_policy-4.pdf+legal+requirements+of+selection+in+UK&hl” September, 2010)

. Proper reference and security checks and clearances are made. Iceland follows complete legal norms to select candidates, hence no major discrepancies are found in the selection procedure.

PRINCIPLES AND PROCEDURES FOR MONITORING AND REWARDING EMPLOYEES

3.1 Iceland Job Evaluation Process

Job evaluation is conducted in the firm in order to rank the jobs on the basis of certain duties, responsibilities and performance attached with the job. In accordance to which the pay package is designed and defined keeping the minimum and maximum limits intact.

Information about every job type is retrieved through the medium of job analysis questionnaire, job descriptions, observations and interviews involving 360 ° selection processes. Based on the above information, each job is rated based on evaluation factors which comprise of:

Education

Experience (Technical and Commercial)

Problem Solving

Impact

Physical Effort

Executive ability

Analytical skills

Complexity of job

Iceland makes use of both the Non quantitative techniques as well the Quantitative Techniques of job evaluation such as the Ranking Methods including paired comparison, simple ranking, points rating method as well.

The Equity motivational theory is applicable in Iceland also where the concerned managers should consider the balance between the input and resulting rewards taking into consideration the input factors such as loyalty, diligence, ability, skill, enthusiasm, support, patience, sincerity, trust, relation with superior etc , backed by reward or output in form of financial and no financial rewards such as wage increase, increased job responsibility, recognition, appreciation , tangible monetary benefits, job security etc (Baxamusa N B, retrieved on 17HYPERLINK “http://www.buzzle.com/articles/equity-theory-of-motivation.html”thHYPERLINK “http://www.buzzle.com/articles/equity-theory-of-motivation.html” September, 2010).

The equity theory works best when the over recognized and benefitted employees are able to produce higher output and quality service and on the contrary the less rewarded employees tend to decrease their output when they compare themselves with other employees.

It becomes the utmost responsibility of the managers to link the rewards with the performance and efficiency of the employee. For this consistent development programmes, regular meetings, and discussions can be undertaken to communicate with employees and make things more clear for better understanding and fairly link reward with performance.

Such kind of evaluation process is logical and objective in nature as it helps to include the newly created job in the pre existing structure of the firm. The undesirable factors of evaluation are eliminated such as fluctuations in market rate etc and help to attain fair wage and uniformity in fixing wages for all employees. Maximum employee satisfaction is realized by maintaining wage equity and sound evaluation structure.

3.2 Reward System

There are different reward systems that can be linked to the organizational compensation packages offered by Iceland to boost up the morale and productivity of employees (Stockley D. 2006)HYPERLINK “http://www.google.co.in/search?hl=en&q=Motivation+and+financial+and+non-“.

Monetary Reward System

Payment for unproductive work in form of

Hours of work

Paid holidays

Paid vacations

Security of employees

Retrenchment compensation

Lay off Compensation

Safety and Health

Workmen’s Compensation

Health Benefits

Welfare Recreational Facilities

Canteen Benefit

Housing Benefit

Legal Aid

Holiday Homes

Educational Benefit

Transportation benefit

Old Age and Retirement Benefits

Provident Fund

Insurance

Gratuity

Medical benefits

Non Monetary Reward

Treats

Free Meals

Festival bashes

Dinners

Knick Knacks

Accessories

Planners

Recognition

Letters of appreciation

Plaques

Social Acknowledgement

Informal Recognition

Solicitation of advice

Memberships

On the Job Benefit

Enhanced responsibility

Job rotation

Training

Special tasks

All the above rewards in some form or the other have a deep impact on the performance of employees as:

Positive Impact

Employees are motivated to work to the best of their potential

Build self esteem and confidence

Increased loyalty

Easy acceptance to change

Close bondage between company and self

Negative Impact

Demotivational impact on employees under conditions of biasness

Short sightedness

Unhealthy competition

3.3 Motivation Theory and Iceland’s Reward System

Iceland’s reward system could be directly linked to the ‘Adam’s Equity Theory of Motivation’ which believes that the factors of motivation can affect the performance of employees and their relationship with the employer as well (Baxamusa N B, retrieved on 17HYPERLINK “http://www.buzzle.com/articles/equity-theory-of-motivation.html”thHYPERLINK “http://www.buzzle.com/articles/equity-theory-of-motivation.html” September, 2010). The theory is based on the belief that if the employee’s inputs are more in comparison to the benefits or rewards derived, it can lead to employee dissatisfaction and reduced productivity.

3.4 Iceland Monitoring Strategy

Iceland has a well planned strategy to monitor the performance of employees that includes:

Reviewing work of employees on a consistent basis

Regularly observing the activities of employees and guiding them when require

Preparing charts, records and using techniques for measuring performance

Encouraging self reporting by employees

Timely redressal of complaints and issues for uninterrupted performance

The latest methods of performance monitoring are adopted by the company such as the Balanced Scorecard method that involves a holistic approach of monitoring by taking into various perspectives such as customer perspective, financial perspective, training and development perspective and innovative aspect as well.

After defining the various factors on which the performance is analyzed such as efficiency, growth, training, development, productivity, behaviour, relations, creativity and innovation at work etc, methods such as Gantt chart is prepared this is a pictorial description of employee’s performance.

Thus, a comprehensive performance analysis is conducted by Iceland which helps to depict a fair view of efforts put in by candidates.

4. EXIT FROM THE ORGANIZATION

4.1 Employee exit procedure in Iceland

On the contrary, when the exit procedure of Iceland was compared with ASDA it was found that the above procedure was quite similar to ASDA, however ASDA adopts an in-depth interview procedure with extra steps such as analysis of exit interview, reasons for absenteeism, Work Interview, analysis of labour turnover, comprehensive Exit Interview Data analysis judging the company benefits provided etc

Analysis

The organizations have drafted suitable exit procedures in order to determine the reasons for employee exits, yet they can’t be termed as best. They are scope for improvement and modification as little emphasis is laid on the employee background and his contribution towards the organization. A fair view can be extracted only when organizational inputs and employee outputs are compared. Thus while studying about the exit analysis, managers should also emphasize on the employee relations with the firm and subordinates. On the whole, the procedure adopted is satisfactory and solves the purpose for the same.

Employee Redundancy

Redundancy is a situation when the organization , Iceland for this case decides to dismiss an employee on the basis of ceased business or intended to cease the area of business where the concerned dismiss employee was employed. For the redundancy to actually be called legal, it is necessary that the employee under question must completely vanish.

If the organization declares any candidate redundant, it is liable to pay the necessary statutory payment in regard to it.

Iceland has adopted certain criteria’s for declaring an employee redundant, they are:

Dismissal can’t be on grounds of individual capability but organizational circumstances

When certain specific designations are no longer required in the company along with reasons for decease or reduction in business process

In the course of a business slow down

When a specific business line is altogether eliminated from the organizations business portfolio

If the employees who are to be redundant are more than twenty, then the matter is to be put forward for consultation with the employee’s representative before making a final decision

Reasons for selecting few employees from the group for redundancy

The selection criteria is not based on any unfair means such as race, age, sex or any disability

Conclusion

Iceland has been able to formulate a systematic and well organized human resource management policy and strategy in the organization, keeping into consideration all the details right from human resource planning to redundancy. Their recruitment and selection criteria are as per the norms of the UK government and in accordance with the legal requirements as well. The company aims to impart maximum employee satisfaction in all respects.

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