hrm in marks

8/6/2019 HRM in Marks

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HRM in Marks & Spencer

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Introduction

In the face of increasing competitive environment organizations have to focus on the value ofinvestments in human resources as a major source of competitive advantage. Although businessstrategy as a means of competition is common conversation in the executive suite, taking a

strategic approach can be especially beneficial for staff functions within companies, as they oftenare required to justify their need for resources and their contribution to the company.

The following report presents the analysis of human resource management (HRM) issuesprovided in the case study on Marks and Spencer's (M&S) organizational change. Discusses

strategic HRM issues facing the company in deciding to create business units and adoptstructural change, and the extent to which M&S needs to overhaul HRM and its core business.

The author also emphasizes the importance of HRM styles and approaches for the company's

medium term business practices, being integrated into an overall organizational strategy.

2.0 Strategic HRM Issues for M&S's Organizational Change

The received wisdom in the literature on organisational change is that employee involvement iscrucial to successful change, especially in situations that require attitudinal and cultural change.

Therefore, any rapid organisational transformations can only be successful if they focus onstructural as reverse to cultural change. The case with M&S is a scenario of rapid organisational

transformation, which was based on a vision imposed on the company in a mainly directivefashion, down from the top, by its management and CEO, but which could potentially lead to a

widespread change of attitudes and behaviours in the company. This change in the middle of thetrading period was a risky action and would bring a big confusion for the staff, putting a high

pressure on their performance. It was an emergent change where staff had to develop and adjustto new ways of a flatter organisational structure and new ways of operations under new business

units.

In the case of M&S, it can be seen that the company deliberately set out to change the basis onwhich it competed by reinventing itself as a service-based organisation. One of the standard

perceptions for successful organizations is that they should know their own strengths andweaknesses, their customers' needs and the nature of the environment in which they operate.

Hence, by introducing new business units M&S aimed to create them fully profit-accountable,putting more emphasis on the individual performance of the departments. This would enable

M&S to effectively control their operations and show where the improvements need to be

implemented. Hence, by this new approach to business practices, the company had to closelyconsider strategic issues of HRM.

One of the reasons behind the proposed change is to modify the attitudes and behaviours of the

staff. People are being required to reconsider their attitudes towards how work is performed andtheir attitudes to their counterparts externally. Whatever form it takes, if it is to be successful,

there are three people-related activities that need to be undertaken: creating willingness tochange; involving people, and sustaining the momentum (Doorewaard and Benschop, 2003;


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Burnes, 2004). M&S in seeking to create willingness and a readiness for change need to beaware that stressing the positive aspects of the proposed change may have much a negative

impact on the company's performance. Therefore, M&S have to make people fully aware of thepressure for such change during the trading period, giving them an on-going feedback on the

performance and areas of activity within the organisation, and understanding staff's fears and

concerns. A constant communication and involvement will have to be present, providingresources and explanations for change. Aligned line managers will have to give all supportneeded to the change agents, develop new competence and skills and reinforce desired

behaviours, such as increased pay or bonus.

The new changes to business units and flatter company structure are likely to increase employeeempowerment and responsibility, increasing more of the direct contacts with customers and

building new knowledge. Post-Modern theories suggest better flexible strategies,accommodating change in the structure of power relationships, where they specialise in their

field of tasks (Johnson and Scholes, 2002; Francis, 2003), To become more flexible M&Sdecided to apply a more horizontal management organization style. Through a clear leadership

role of appointed heads of business units, centralisation will also be high only to a certain degree,not to prevent adaptability and flexibility of staff. Coordination will need to be in a form of a

clear structured hierarchy and division of labour. To encourage job enrichment and staffsatisfaction, M&S may establish one or more specific coordinating roles. Liaisons, individual or

departmental, committees, task forces, project groups, and the like are all examples of possiblestructural coordinating devices.

Many modern theorists believe that in order to succeed business culture needs to be change-

oriented and, hence, M&S need to adapt to differentiating changing environments and internalworkforce diversity.

3.0 HRM Approaches for M&S's Medium Term PerformanceThe interpretation of HRM is based on incorporating either a "soft", developmental humanist

approach or a "hard", situational contingent approach (Liao, 2005). Schneider (1994) hassuggested that in the "soft" approach, effective HRM is seen necessarily to involve a focus upon

fostering employee motivation, commitment and development. It is an approach thatacknowledges the importance of HRM to the aims of the business, whilst reflecting attempts by

management to create a work environment that emphasises employee development, throughpractices such as training, participation and communication, and the importance of having

innovative, flexible, committed employees who are valued resources.

"Hard" HRM is, as Liao (2005) has noted, closely aligned with what is often termed strategicHRM. In these instances, HRM is closely linked with business strategy. Accordingly, it views

employees as resource to be used dispassionately and in a formally rational manner. As such,HRM effectiveness can be more contingent upon cost minimisation measures rather than upon

significant investment in human resources. A "hard", contingency-based approach to HRM isoften seen as an essential part of a cost-minimisation strategy. However, in the case of M&S it is

suggested that for a successful implementation of changes, there is a more need of " soft "approach for the medium term success, as everyone within the company needs to cooperate and

understand the importance of the changes.


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For M&S the commitment of senior management and the assigned heads of the business units toHRM are crucial to company's effective operation. It would be essential to possess the

knowledge and skills necessary to implement a credible HRM programme within theorganisation. For a medium term success, M&S needs to consider the following HRM

approaches:

y A clear understanding and commitment of the management to the desirable change needto prevent any conflicts and operational barriers;

y Good dynamic and effective leadership will have to take place and be supported by themanagers of M&S;

y It is also importance to consider teamwork in decision process. The employees have to beintegrated into the change process management;

y To become more service-focused company, M&S will have to look at a culture ofcommunication, so that people can use the advantage of a good working team for the

progress and the company's success. Mayo's motivation theory also suggests thateffective communication is an essential part of organisational changes and an effective

foundation of modern organisations. Hence, M&S has to put greater emphasis onimprovement of interpersonal communication skills of all organisational members;

y As McGregor's theory proves, employees are likely to be motivated by the goals ofachievement and " self-esteem ". By rewarding staff and by leading people, M&S would

build a good management for a medium-term success;y Staff involvement and participation are likely to contribute to a sense of responsibility

and ownership and, hence, organisational commitment and loyalty. The norms and beliefsthat enhance an organisation's ability to receive, interpret, and translate signals from the

environment into internal organisational and behavioural change will promote itssurvival, growth and development;

y It may be important to clarify the strategy throughout the hierarchy to every employee(Huang, 2001). An effective two-way flow of information and communication has to take

place, so that everyone will be aware about the goals and visions of the company'sgrowth. Face-to-face, one-to-one communication through to routine bulletins on notice

boards and circulars sent around the organization might take place for effectivecommunication of the message. Staff meetings have to take place to inform everyone

about the changes and prevent misunderstanding and dissatisfaction. In order to get afeedback on the changes, two-way communication approach has to be encouraged;

y A good strategy for dealing with conflicts and contingency system is also essential formfor the operational process.

4.0 HRM and Core Business of M&SOne of the challenges for managers having to introduce change in the company is to determine

the strategy that will produce the best results. In a situation of excellence, a company has to beable not only to adapt in an outstanding way to its market conditions, but also to develop internal

practices that clearly set it aside from the competition.

Change can be costly, not only in financial terms, but in terms of management time. Thequestion should arise whether M&S has enough capabilities and is ready to manage change and,

more importantly, readiness to achieve the scope of change.


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It is not enough to adjust the performance management processes to support changing businessstrategies. Managers of M&S need to be able and willing to envisage a future where the

strategies and performance of the company are transformed by stretching the staff's capabilitiesof the organisation better than their competitors. The primary goal of M&S management has to

be in overhauling an integrated relationship between HRM and the core business to successfully

implement the changes.

Strategic capability is essentially concerned with how the resources (including people) are

deployed, managed, controlled and, in the case of people, motivated to create competences inthose activities and business processes needed to run the business (Huang, 2001).

Bergenhenegouwen (1996) states that the concept of core competences goes beyond this in asearch for those few activities that underpin competitive advantage. Nevertheless, the starting

point of successful strategies for M&S is acquiring, retaining and developing human resources.Much of the hard side of HRM is concerned with ensuring that this baseline is maintained in

the company. Such HRM activities as audits to assess HR requirements to support core businessstrategies, goal-setting and performance assessment of individuals and teams, the use of rewards,

recruitment as a key to improve strategic capability, and training would assist M&S managementin delivering about the proposed change in the most effective way for business outcomes.

M&S has been always renown for the strength of linking business and human resource strategies.

This tends to bring clarity from the business planning process. However, operating in a highlycompetitive environment, with a constant pressure from stakeholders and external forces impacts

the decisions of the management Board, as it was in this case.

In general, a strategic approach to HRM involves the designs and implementations of a set of

internally consistent policies and practices that ensure a firm's human capital to contribute to theachievement of its business objectives. Fundamental to the strategic HRM perspectives, there is

an assumption that firm performance is influenced by the set of HRM practices a firm has inplace. M&S line managers can enhance productivity by building a sound HRM system having a

set of specific HRM practices in different ways. This necessitates the development of anapproach to investigate the correlation between a firm's productivity and strategic HRM factors.

Based on that understanding, managers can adopt appropriate strategies to improve company'sHRM so as to increase the business units' total productivity. According to strategic HRM, the HR

strategy should be developed alongside the general strategy of the organization, to acquirecultural fit within and with the outside environment.

5.0 Conclusion

Every organisation wants to be successful and depends upon its employees to make that happen.Success should be viewed over the long term. A healthy organisation can go the distance and the

best metric of success should be the health of the employees.

The most important issue of M&S is to build upon the company's already existing strengths and

try to overcome the threats of the change. One of the major benefits claimed for organizationallearning is that it enables organizations to manage change in a timely and effective manner. The

organizational learning and individual development movement was largely a response to theneed for organizations to seek to sustain competitiveness and survival in a discontinuous


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environment. Management practice today is still largely driven by a closed systems view thatrelies on planning, on a consensual, top-down implementation of change interventions. M&S's

change requires time and energy for learning new approaches, but it is necessary to develop newskills and capacities. M&S has a long history of change management and HRM excellence, but

even for them, resolving their present tensions and changes represent a considerable challenge.

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hrm in marks

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