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Introduction

This paper aims to critically explore the key benefits and challenges of managing diversity within the workplace. It begins by examining the concept of diversity and the drivers for it, and then, drawing on examples from the current literature, reviews the different benefits and challenges of managing diversity in the workplace. The paper also identifies some of the different approaches organisations can take to effectively implement the management of diversity at work, and concludes by summarising the key learning points.

Understanding workplace diversity

In essence, the concept of diversity incorporates values and behaviours associated with acceptance and respect. It requires the understanding that each individual is unique, a recognition of individual differences, and goes beyond a simple tolerance of each other to a more embracing approach to the valuable dimensions of diversity contained within every individual (Patrick and Kumar, 2012).

The term ‘managing diversity’ itself first originated in the United States in the late 1980s and emerged as a result of anti-discrimination law and social equality issues (McDougall, 1996). It has since become to be viewed as a contemporary alternative to the more traditional equal opportunity approaches (Noon, 2007), and asserted to be proactive and results-focussed (CIPD, 2005).

The issue of workplace diversity has become increasingly debated in management circles due to expanding globalisation, changing demographics in the labour market and a greater awareness and acknowledgment more generally that there are differences between individuals (Hite and McDonald, 2010). This has meant that the issue of managing diversity has become one of importance and significance in both public and private sector organisations (Kirton and Greene, 2009; Farhad, 2007). According to Patrick and Kumar (2012), the biggest driver for high level management of diversity is the need to tap into the creative, cultural, and communicative skills of all employees and to use those skills to improve organisational policies, products, service, and customer experiences.

Other drivers for diversity include changes in legislation and societal awareness of it as an issue and this has meant that organisations are being forced to give a greater focus to the issue of managing and promoting diversity (Holbeche, 2009). In the UK, the Equality Act came into force in 2010 and consolidated all grounds of discrimination, and previous legislation, into a single statute. This Act placed new duties on employers around the management of diversity within their workforces and employment practices and requires organisations to visibly demonstrate what action they are taking to address it (Kumra and Manfredi, 2012).

Benefits of workplace diversity

There are numerous cited benefits for organisations that have a diverse workforce, such as it acting as a source of real competitive advantage (Herring, 2009) and being associated with increased profitability (Ng and Wyrick, 2011). It is claimed that diversity in the workforce can increase productivity and organisational effectiveness by harnessing the contribution of a wider range of perspectives (Choi and Rainey, 2010) and through the creation of stronger teams (Herring, 2009). In addition, it is argued that successfully managing diversity can result in more satisfied and committed employees delivering potentially enhanced financial performance for the organisation (Patrick and Kumar, 2012).

It has been suggested that organisations which are considered to be inclusive have a wider talent pool from which to recruit the most qualified and effective candidates thereby giving them competitive advantage over rivals (Edwards, Watkins, and Stevens, 2007). Similarly, it has been proposed that organisations that actively promote diversity in its workforce benefit from increased retention rates of existing employees (McKay et al., 2007).

In relation to innovation and creativity, it has been argued in the literature that a diverse workforce can enhance this. In particular, it has been found that racial and gender heterogeneity can result in more diverse types of information and ideas being shared within an organisation leading superior problem solving and decision-making (Richard, Kirby and Chadwick, 2013).

Furthermore, diversity in the workforce can deliver business advantage when dealing with diverse customer bases or international markets (Podsiadlowski et al, 2003), as organisations with diverse employees tend to have a better understanding of the requirements and obligations of the legal, political, social, economic, and cultural environments in which they operate (Patrick and Kumar, 2012). Diversity also helps in this respect by expanding an organisation’s perspective and its strategic tactics, the design of new operations, and the assessment of emerging trends within its sphere of business (Martin, 2014).

Challenges of workplace diversity

A number of challenges associated with diverse workforces and their management have also been identified. According to Ewoh (2013: 109), one of the main barriers that exist to managing diversity in the workplace relates to the language and terminology that is used to discuss it. He claims that many commentators on diversity claim that the problem stems from its definition and how the concept of diversity can be distinguished from those relating to positive action and equal opportunities. Foster and Harris (2005) claim that this ambiguity can make the implementation of diversity management problematic, and it has been claimed that the conceptual relationship between diversity and equal opportunities is blurred making it a complex issue to address for managers (Maxwell, 2004).

It has been argued that diversity has the potential to reduce group cohesiveness and increase conflict in teams and between employees and managers (Skerry, 2002). In particular, cultural diversity amongst employees has been found to be problematic. Culturally diverse employees have different opinions, beliefs, norms, customs, values and traditions and when such workers are placed in a group setting to achieve an organisational goal with mutual effort and collaboration, these differences of views and beliefs have the potential to hinder the development of unity (Martin, 2014). Some studies have also shown that this can also lead to reduced staff morale and productivity (Roberson and Kulik, 2007; Wrench, 2005).

Furthermore, approaches to managing diversity have been criticised for failing to sufficiently take into consideration the structural disadvantage that exists for many minority groups within the workforce (Wrench, 2005) and for not being able to adequately confront the dominant ideologies and power relations that exist (Noon, 2007).

Challenges also exist in relation to developing human resource policies and practices that meet the needs of a diverse workforce. According to Tung and Baumann (2009) people from different ethnic groups and cultural backgrounds hold different values when it comes to areas such as pay, reward and incentives and therefore organisations cannot assume that individuals from different ethnic groups will react in the same way to monetary based performance systems or financial schemes. Similarly, people from different cultural backgrounds may also hold different work ethics (Moran et al, 2014), and there may be variances in terms of acceptance of authority which has implications not only for policy development but also day to day management practice (YA±ldA±z, 2013).

As well as considering diversity in terms of the ‘protected characteristics’, organisations also have the challenge of embracing diversity in a wider sense. For example, Hunter and Ogungbure (2013) explore diversity in the workplace in relation to contemporary appearance such as hairstyles, tattoos and body piercings, and argue that they may impact on corporate culture and other organisational employment practices. In particular, they claim it can become particularly problematic for organisations when it is claimed that such outward body alterations are associated with religious beliefs. This is an area that is relatively unexplored but may also present practical challenges for organisations.

Implementation approaches for managers and leaders of diversity

According to Stevens, Plaut and Sanchez-Burks (2008), approaches to cultivating and managing diversity in organisations can be done in a number of ways. They claim that some organisations demonstrate their commitment to promoting diversity via a range of ‘diversity initiatives’ that are implemented into daily practice, whereas others choose instead to adopt a ‘colour blind’ approach to diversity.

The colour blind approach focuses on realigning workforce group identities with an overarching identity (Hogg and Terry, 2000), with the aim of decreasing the emphasis on individual differences. It stems from the notion of ‘treating everyone the same’ but has been criticised for being exclusionary and appealing only to nonminority groups (Markus et al, 2000). In contrast, the multi-cultural approach is based on the assumption that the differences between people are a source of strength for organisations and these differences need to be embraced and nurtured (Stevens, Plaut and Sanchez-Burks, 2008). With such an approach, a range of strategies are used to promote diversity including targeted networking and mentoring programmes aimed at specific minority groups, ‘diversity days’ where the cultural background of different groups of staff is celebrated, and the provision of targeted and generic diversity training (Paluck, 2006).

However, it has been claimed that with both of these approaches, organisations face real challenges in that neither approach will be welcomed by all staff. The multicultural approach can be seen by non-minority groups as posing a threat to their social identity (Verkuyten, 2005), and the colour blind approach is felt to take insufficient account of the structural disadvantages faced by minority groups (Noon, 2007). To overcome these limitations, Stevens, Plaut and Sanchez-Burks (2008) propose a new approach to managing diversity which they term ‘all-inclusive multi-culturalism’. They claim that this approach offers an alternative to the more traditional colour blind and multicultural ideologies by having a specific focus on employee inclusion, and the formation of high quality authentic relationships between employees that are resilient, transparent and which promote on-going learning. They claim that in order to implement such an approach, organisations need to create environments that are considered to be more inclusive by all members of the workforce with the implementation of policies and practices that are framed as benefiting everyone and the use of language and communication that does not label different groups or single them out.

Similarly, Richard, Kirby and Chadwick (2013) argue that in order for diversity management to be effectively implemented, and to avoid the common pitfalls, organisations must develop mechanisms whereby cooperation and collaboration across all roles is supported and create an inclusive environment that promotes belongingness.

According to Ewoh (2013: 114), in order to create such an environment that enables diversity to be managed, diversity leaders across an organisation must be identified and supported. In addition, clear objectives relating to diversity must be communicated alongside the provision of appropriate training to help managers and leaders deliver these. He further claims that support and commitment from ‘the top’ is essential along with recognition that ‘bottom-up’ input and engagement from diverse workers is needed to enhance the quality of decision making and the development of more innovative and sustainable policies. In agreement with this, Guillaume et al (2014), argue that effective leadership is essential to making any strategy for managing diversity in an organisation work. They identify leadership at the middle management level as being particularly crucial given that it is most likely that it is individuals at this level who will be tasked with implementing in practice an organisation’s diversity management policies and procedures, and be responsible for reinforcing the enactment of related diversity management practices in day to day work.

Conclusion

From the critical review presented above it is clear that there is increasing focus on the issue of diversity within the workplace as a result of increasing globalisation, changes in the labour market and external regulatory drivers.

There are many benefits identified from effectively managing workplace diversity including increased productivity, innovation and creativity, improved employee relations, and more effective working with diverse customer bases and international markets.

There are also, however, a number of challenges for organisations in implementing the management of diversity effectively and in avoiding some of the identified disadvantages which can result in negative outcomes such as increased team conflict and reduced team cohesion. In addition, the ambiguity around the term ‘managing diversity’ itself adds another level of complexity for organisations and individual managers in embracing this agenda effectively.

A number of strategies and approaches have been identified for implementing the effective management of diversity and all focus on creating inclusive cultures within organisations which require strong leadership and reinforcement in practice. It is clear that with the ever increasing diversity in the labour market, this is an important issue that organisations need to continue to review and address both now and in the future.

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Introduction

Employee stress is becoming an increasing problem for many managers across the world to combat. It has escalated to such an extent that the World Health Organisation has declared “occupational stress as a worldwide epidemic” (Avey, et al., 2009, p. 677). Furthermore, it can hold a number of negative impacts on the performance and profitability of a company, so managers should be consistently attempting to reduce the levels of employee stress in the workforce.

This essay will define what exactly employee stress is and what the predominant factors are that are affecting its rise. Furthermore, an analysis will be conducted on the negative effects that employee stress can have on the workforce and company, and how managers should try and reduce the levels of employee stress in their workforce.

Employee Stress

tress can be defined as “the physiological and psychological reaction, either consciously or subconsciously, to a perceived threat or undesirable condition beyond one’s immediate capacity to cope” (Chaing, et al., 2010, p. 26). Employee stress can have a number of negative effects on employee performance, with problems in health, increased accidents and burnouts being common issues for stressed out employees (Bernard & Krupat, 1994).

A variety of researchers attribute different factors to causing stress. These factors are commonly referred to as ‘stressors’. Colligan & Higgins (2006) attributes technological change, global competitive pressures, toxic work environments and managerial bullying as the main components to an increase in employee stress.

Furthermore, a study by Dahl (2010) heavily pins organisational change to the main factor that can impact on employee stress. It is thought that the majority of companies do not pay heed to the psychological affects that organisational change can have on employees, as they often focus on how the company’s performance will be benefitted. Primarily, organisational change can result in firm failure (Haveman, 1992; Barnett & Freeman, 2001). However, other theorists suggest that “the emotional and psychological wellbeing of employees are potentially affected by organizational change” (Dahl, 2010, p. 2).

Although outdated, one of the most comprehensive frameworks that identify stressors is provided by Murphy (1995, p. 42). He lists thirteen key factors that attribute to an increase in employee stress, which include; physical environment, role conflict, role ambiguity, interpersonal conflict, job future ambiguity, job control, employment opportunities, work load, variance in work load, responsibilities, underutilisation, demands and shift work. Furthermore, he suggests that these factors can be affected by “non-work factors” such as domestic demands. However, these factors would generally be out of the control of management. Murphy concludes that all of these factors that cause employee stress can lead to job dissatisfaction, accidents, complaints, substance abuse or even more serious, illnesses.

Although it seems that employee stress can only hold negative outcomes for a company, it has been found that it can provide a number of positive benefits. This can include increased creativity (Le Fevre, et al., 2003) and enhanced performance (Marino, 1997). However, despite the possible benefits that employee stress can hold, it also provides a plethora of more serious and negative effects. It is because of this negativity that managers must closely watch, and actively attempt to reduce employee stress.

Reducing Employee Stress

There are a variety of studies which outline a number of different ways in which a company can reduce employee stress. A study by Murphy (1995) outlines two significant ways in which to combat employee stress. These are:

Employee Assistant Programmes (EAP): These programmes have existed in the workforce for over 70 years now, with their main focus to treat “troubled” employees in the workforce. However, as workplace stress got more and more attention, it became more about providing wellbeing and care for all employees in a workforce. The programmes have since been expanded to deal with more intense stress relating incidents, such as the loss of a fellow employee, with these called stressor-specific programmes. Although these programmes seem positive, they do have their downfalls. This is primarily the fact that it is hard for feedback to be related back to managers, and that the programmes do not analyse how the organisation may be affecting stress, but focus on employees’ personality or characteristics.
Human Resource Management (HRM): The responsibilities of HRM can vary across different companies, but usually include the following; personnel management issues, performance appraisal, discrimination, team building and labour relations. Although not specific to employee stress, all of these areas can be attributing factors to employee stress levels. Furthermore, they act as an opposite to EAPs, as they act in relation to the organisation and not in relation to an employee’s personal traits or characteristics.

The study goes on to conclude that the best way to manage employee stress is to combine both of these practices. This allows employee stress to be monitored from a personal level with the EAPs and an organisational level from HRM.

Furthermore, the study by Avey, et.al.(2009) outlines a more modern approach on how managers can reduce employee stress. They call this approach the ‘Emerging Positive Approach’. This approach basically aims to focus on the positive side of things, highlighting employee strengths instead of focusing on their weaknesses. This can be called ‘Positive Organisational Behaviour’ (POB), which is “the study and application of positively oriented human resource strengths and psychological capacities that can be measured, developed, and effectively managed for performance improvement” (Luthans, 2002, p. 59).

Although this approach doesn’t specifically address employee stress, the nature of it helps reduce or even avoid it. As it seeks to highlight the strengths, it should increase performance of employees and allow them to work in an environment that is enjoyable to them. Instead of waiting until an employee is unhappy or stressed, this approach will actively try to combat the thirteen factors that Murphy defines as key ‘stressors’.

The aforementioned approaches all rely on heavy involvement from internal or external forces. However, there are a number of smaller things that managers can do to try and maintain a happy workforce and reduce employee stress. These are outlined by (Hengst, 2015), and include:

Support management: Management should be supporting their employees on all levels of the company hierarchy. Employee stress is obviously important to deter, but managers can also get stressed in the workplace. Maintaining support through every level of the organisation helps ensure that stress is not passed on from a manager to their employees or team.
Little rewards: Giving little rewards to employees can help reduce employee stress significantly. This could be in the form of bonuses for reaching certain goals, or a quarterly trivial reward system that hands out achievements of certificates. This does not cost the organisation a lot of money, but will help reduce the levels of employee stress.
Encourage fun: Although the workplace must maintain a serious atmosphere, there is no harm for encouraging employees’ to have fun. This can be organised after work, or during particularly slow times of business. Holding parties or events to encourage fun also provides an opportunity to build upon team-working and iron out any interpersonal issues.
Healthy lifestyle: Employees should be trained to work in a safe manner, and to not be afraid to ask for support if needed. Looking after employee wellbeing is one of the most significant factors for reducing employee stress. Any workplace injuries will most likely cause stress to the individuals involved, but may also cause tension with other employees in the company.

All of these factors do not need rigid implementation, but can be done throughout the year to maintain a positive work environment and reduce employee stress levels. They are all reliant on a manager being involved with their employees, and taking a genuine interest in maintaining employee wellbeing.

Conclusion

It becomes quickly apparent that employee stress can cause many issues for a company and an individual. The negative effects heavily outweigh the limited number of positive effects that it can hold. Although there are a number of external forces that can effect employee stress, a lot of responsibility is placed on managers on how to reduce levels of employee stress.

One of the earliest methods was with the use of EAPs. However, this did not take into consideration how the organisation is affecting stress levels, and so a collaboration of EAPs and HRM is a more optimum method. Furthermore, as an EAP can be sourced externally, it reduces some of the responsibility on the manager to reduce employee stress levels, as they only need to monitor how HRM are handling any issues.

Furthermore, the more modern approach to reducing employee stress is to stop it, before it can begin. This is shown through the emerging positive approach, as it encourages companies to maintain a positive atmosphere in the workplace, and deter employee stress before it can begin.

Although there are a variety of approaches to managing or reducing employee stress, there is no quick fix. Managers should be constantly monitoring employee stress levels, and implementing consistent processes to help reduce it. Stress levels cannot be reduced by a one-time incentive, but must be slowly reduced over time by the help and support of the management team.

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Introduction

In recent years there has been an upsurge in the Internalization of markets as various organisations are extending their services to different countries of the world in a bid to either flow with the competition existing within its industry, reducing costs etc. Managers of multinational firms are now increasingly realizing the significance of people management practices in ensuring the profitability and viability of their business operations (Brewster, 2002).

This act of internationalization introduces the human resource manager to the intricacies and issues that come with the internationalization of a corporation. These issues and intricacies have led to the introduction of the International Human Resource management which according to Dowling and Welch (2004) is defined as ‘going beyond the spectrum of management of expatriates and extends to the worldwide management of people.’

Scullion (1995, cited in Scullion & Collings, 2006) defines as ‘the Human resource issues and problems arising from the internationalization of business, and the Human Resources management strategies, policies and practices which firms pursue in response to the internationalization process.’ These Human Resources Management Policies though from the Parent Country (PCN) cannot always be applied in the various subsidiaries. Thus the aim of this work is to find out the factors human resource managers must consider when preparing IHRM policies.

Recruitment and Selection

Recruitment and selection according to Price (2004) are major issues for human resource managers. Recruitment is often described together with selection, which in time follows immediately after or is often closely connected with recruitment.

Anderson (1994: cited in Beardwell & Claydon, 2007) states that these issues are concerned with identifying, attracting and choosing suitable people to meet organisations’ human resource requirements. Though these processes are at times used simultaneously an attempt to differentiate its meaning is pertinent.

Recruitment is an instrument of the company’s HR policy, concerning decisions to be taken in a company or another organisation. It is a HR practice to attract appropriate individuals or groups for an organisation. It is defined by Dowling and Schuler (1990, cited in Beardwell & Claydon, 2007) as “Searching for and obtaining potential job candidates in sufficient numbers and quality so that the organisation can select the most the appropriate people o fill its job needs’.

While Hackett (1991: cited in Beardwell & Claydon, 2007) defines Selection as being more concerned with

‘Predicting which candidates will make the most appropriate contribution to the organisation- now and in the future’

According to Edward and Rees (2006) it involves testing and evaluating the skills and attributes of these individuals to determine which are the best for the job at hand. Either way the importance of a good recruitment and selection process is very important and has now become quite obvious as managers of multinationals have become increasingly aware that in order to succeed in their international strategies and business their human resources have an important role to play in their success as an international organisation.

Approaches to Recruitment and selection

When an organisation becomes international another factor that affects its Recruitment and Selection Policies are the organisation’s corporate culture which according to Perlmutter (1969, cited in Harzing and Ruysseveldt, 2000) could be Ethnocentric, Polycentric, Regiocentric or Geocentric.

Briscoe and Schuler (2004) are of the view that these approaches to staffing is usually a progressive one as it changes over time as a firm develops greater international experience and sophistication. Some other scholars are of the view that these approaches also change due to the political stability and legislations of the various countries where these subsidiaries are situated etc.

Ethnocentric Approach

This approach reflects a focus on the home country values and ways of operating thus organisations who apply this approach are organisations that are primarily home-country oriented. Key positions in the headquarters (HQ) and subsidiaries are filled by parent country nationals or citizens of the country where the HQ is located. Perlmutter (1969) noted that in these organisations home based policy, practice and even employees are viewed as superior and foreigners can be viewed as, and feel like second class citizens.

Research though has shown that ethnocentric approach to the staffing of an international organisation is usually most appropriate during the early stages of internationalization when the need for control is greatest. Mayrhofer and Brewster (1996, cited in Harris et al, 2003) have however advised against a wholehearted rejection of an ethnocentric approach to international staffing.

Polycentric Approach

This approach is based primarily on the host country orientation. The foreign subsidiaries are primarily staffed by the host country nationals or managers from the subsidiary location. This staffing approach according to Perlmutter is likely to be evident where organisations serve heterogeneous product markets and where products and services must be adapted and marketed to suit specific national tastes.

Regiocentric Approach

This approach is based on recruiting on a regional basis and according to Scullion and Collings (2004) International transfers are restricted to regions as managers are selected based on ‘the best in the region’.

Geocentric Approach

This approach according to Scullion and Collings (2006) involves the filling of positions at both HQ and subsidiary level with the best persons for the job regardless of the nationality. According to Evans et al (2002 cited in Scullion and Collings; 2004) ‘The skill of the person is more important than the passport’. This approach though is usually used when the organisation is at a mature stage.

These approaches usually come to play when there is a need to staff the subsidiaries of a multinational corporation and also when it has to do with the staffing policies for key positions within the Multinational Corporation especially since lower levels are, according to Harzing (2004) inevitably filled by host country nationals and third country nationals.

And also these approaches are not fixed but tend to change as the need for control changes and according to Welch (1994) the staffing need of an organisation changes with the organisation’s stage of internalization. (See case study 2)

Factors Affecting Transfer of IHRM Policies (Recruitment and Selection)

According to Koen (2005 cited in Mullins, 2007) ‘

The methodology of recruitment and selection has never been uniform across the world. Moreover, whether a specific personnel selection practice should be adopted universally remains an unresolved issue. However, given the crucial role played by this personnel function, especially in managing a multinational workforce, understanding the similarities and dissimilarities of existing practices in different nations ought to be the first step taken by human resource managers and researchers.

From this definition it can deducted that various countries have various recruitment practices and according to Harris et al (2003) this is due to the fact that organisations are increasingly recruiting beyond their national borders and this trend is not just to staff International corporations but also for domestic purposes. Also recent research has revealed that companies in different countries differ with respect to their HRM practices and policies (Ferner, 1997) not just in their recruitment and selection processes.

It has also been noted that transferring HR policies and practices to different countries can be quite problematic (Bae et al., 1998; cited in Myloni et al, 2004). Some of the major obstacles for these difficulties in transferability of culture according to Myloni et al (2004) are closely related to the host country’s cultural and institutional environment.

But Hayden and Edwards (2001, cited in Edwards and Rees 2006) state that the ease with which an organisation can transfer its policies and practices to its subsidiaries is shaped partly by its dependence on ‘supportive and distinctive extra-firm structures’

This means that when HR managers are preparing their R&S policies that they can apply in their worldwide operations there are certain factors they have to take into account while at the same time ensuring that in line with all Human resource Policies and practices their recruitment and selection Policies must be linked to the overall strategy and objectives of the International organisation.

Various authors have various views as to what these factors that affect the transferability of HRM staffing policies might be. Vance and Paik (2006) are of the view that such factors include issues such as the firm’s business strategy, stage of international development, specific foreign market experience host government restrictions and incentives, host country sociocultural restrictions and plans for individual and organisation development.

Hayden and Edwards (2001) have also argued that the differences between national business systems also limit the transferability of employment practices as their introduction to other countries is subject to the ‘constraints’ posed by the recipient systems. There also can be situational factors such economic trends and conditions, the nature and duration of the international work itself, MNC resources available, and the availability of willing and able candidates.

Harris et al (2003) are of the view that the following are the factors that an International HR manager must take into account;

The type of labour legislation.( in the Host Country)

The type of labour market

Appropriate recruitment sources

Host-Country Factors (Macro-environment Factors)

While Gronbaug and Nordbaug (1992) are of the view that there are both Micro and Macro environmental factors that affect International Organisation’s Shen(2006) is of the view that here are also two factors that influence transferability and terms them as Host Factor and Firm specific factors.

The Micro factors according to Gronbaug and Nordbaug are divided into two -including primary issues such as a subsidiary’s relationship to other parts of the international organisation, and the secondary factors embracing external issues such as customers, competitors etc. While the Macro factors (which concerns this work) include –

Socio-economic Factors – This refers to the standard of living in terms of wages, and which also includes the field of economic compensation, differences in national education and training system which according to Beardwell and Claydon (2007) are likely to mean that the skill and competence profile of the workers available on the labour market will differ from country to country.

Political/Legal Factors – Legal requirements touch on every aspect of relationships between employers and employees according to Morrison (2006) and since what is legally and socially acceptable in a firm’s operations in one country may not acceptable in another (Beardwell & Claydon, 2007) political and legal factors may contribute to structuring recruitment and selection policies and as such host country legal regulations represent a strong environmental pressure on MNC subsidiaries (Schuler et al, 1993 cited in Myloni et al, 2004); and the legal environment in which the MNC subsidiary is embedded can constrain the transfer of HRM practices from its parent (Beechler and Yang, 1994).

Culture

Differences in management cultures may mean that some management styles are more appropriate in some national settings than others (Beardwell and Claydon, 2007)

Firm specific factors

International Strategy

International organisational culture

Organisational Culture

Stage or mode of Internalization

Type or niche of industry

Size of international Operation

Reliance on international markets

Top management’s perception of home HRM systems

Host Contextual factors

Political factors

Legal Factors

Economic Factors

Socio-cultural factors

International recruitment and selection policies and practices.

Other Factors

Trust

Personal Moral Merits

A model of factors that affect international recruitment and Selection (sourced from Shen, 2006 – an adaptation of Hamil 1987 and Welch, 1994

Firm Specific Factors

Type of Industry – The type of industry that the International organisation is into will also determine the ability of the PCN to impose its policies and practices on the subsidiary (Welch 1994). For example if it were a banking sector the transfer of human resource policies will be low especially where the country has a strong union like in Greece. (Myloni et al, 2004) Boyacigiller (1990) also argues that HCNs might have more important links or connections that might benefit the organisation more and will thus have a lower potential of having PCNs.

Stage of Internationalization – organisations go through a learning process as they move towards becoming international. This process might be gradual, it might take place in stages, or development might be in leaps (Hedlund, 1986), and research has shown that the older the International organisation gets the lower the level of HRM transfer in comparison to middle-aged ones. Thus according to Miliman et al (1991) there exists an association with an organisation’s international experience and its use of PCN

Taylor et al (1996) are also of the view that there exists a link between the Size of an international Operation and its reliance on international markets. It also seems to have a link with international experience as it affects senior management’s orientation or approach to staffing which will as the MNC gets older shift from Ethnocentric to Geocentric.

Organisational Culture – In managing people to achieve organisational goals, organisations prefer clarity, certainty and perfection according to Pascale and Athos(1981) Simply defined it is the way we do things here (Bowler, 1966) and MNCs will tend to merge their organisational culture with that of the host country so as to be able to maximize their operations within the subsidiary.

Conclusion

From this work it can be deducted that the ability of an International Organisation to transfer its policies and Practices depends on many factors and these factors also depend on the time factor. This is due to the fact that it is easier for an International Organisation to transfer its policies to the subsidiaries and also enforce these policies (or forms of control) when the subsidiary is just at its inception stage and usually at this point most governments of these Host countries in their bid to encourage foreign might consider waiving certain legislations for the International Organisation. But as time passes these policies will be eroded as the subsidiary gains experience.

SWEDCO

(Adapted from Edward and Rees,2006)

Swedco is a Swedish Organisation and is a highly internationalized firm that produces high-tech manufactured goods and it employs tens of thousands of employees, approximately half of whom are outside Sweden. From the case study it will be assumed that Swedco has subsidiaries both in the UK and also in Belgium.

Culture

Swedco had the tendency to spread a ‘ democratic’ approach in their management style , also they tended to boycott or bypass hierarchy in the sense that the organisational actors according to Hedlund (1981) did not feel constrained by formal authority relationships thus the employees do not think it to be anything to jump hierarchy in order to put forward their ideas( which according to Hayden and Edwards (2001) was a typical trait or characteristics of the Swedish in terms of culture) but in recent times the evidence shows that the country of origin effect is being eroded as senior management have now tended to draw on Anglo – Saxon styles of management.

From the case study it appears that the Swedco Subsidiary in UK does seem to have a hand in the making and establishment of these policies that affect the whole organisation. This goes to show that as the International organisation gains more experience there is a fusion of the cultures of both the Parent country cultures and that of the Host country.

International Experience – In recent times as shown by the case study there has been policies set out based on the development of a cadre of managers from across the company. Subsidiaries are being encouraged to submit suggestions for individuals who should be considered for promotion to positions elsewhere in the firm.

This makes it clear that the management are of the view that the Subsidiaries have gained enough experience and have the right cadre of managers to be able to run the subsidiary without the use of an expatriate as would have been the case where the country had just recently internationalized.

From the case study it is clear that though the country of origin did have some form of control over its subsidiaries either in its staffing options or in the way their carry out their jobs and functions, with the passage of time there has been a change in the way things are done as the various cultures are merging.

HSBC: The International Manager Program

HSBC is a major financial services organisation that employs about 170,000 people and operates in over 80n countries. The bank has colonial roots and was originally based in Hong Kong. It was managed by ‘international officers’ who were largely British expatriate. In the early 1990’s, Midland Bank was acquired. Major acquisitions in North America have also made HSBC the largest foreign bank in Canada and the USA. The corporate centre is now UK. The bank’s vigorous advertising campaign features the need to be sensitive to local culture and customs in order to succeed in business, proclaiming it to the world’s Local Bank’

The expanding geographical reach of HSBC and its growth through acquisitions have increased the need for international deployment of people. This currently outweighs the decreasing need for expatriates in some of HSBC’s earlier markets, where most highly skilled local people are now available. HSBC has retained a specific group of international managers’ (IMs). Individuals are recruited direct to the International Manager program either from higher education or internally. The career deal for IMs is clear. They can be sent anywhere at a short notice, and so give high commitment to the organisation. In return, the individual has a good employment package, a wide variety of challenging jobs and good career prospects leading to general management positions. – Harris et al (2003)

From this case study it can be seen that though HSBC started with an ethnocentric approach to its recruitment and selection process it later had to switch to geocentric in a bid to adapt to the various cultures where it has its subsidiaries.

References

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Case Study 1 Adapted from Harris, Hilary, Brewster, Chris and Sparrow, Paul (2003) International Human Resource Management, London: CIPD

Case Sudy 2 Adapted from Edwards Tony and Rees, Chris (2006) International Human Resource Management: Globalization, National Systems and Multinational Companies, Essex: Pearson Education

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Page, London,

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Throughout the 20th century, businesses thrived by making their production methods more and more efficient by improving production processes and developing better ways for making things. However, efficiency in production methods is no longer the only success factors in today’s business world. The excellence of 21st century lies in Information management i.e. having the right thing, on the right time, in the right quantity. Information is one of the most critical elements for the success of a business. Information has become one of the most significant assets for a business. The performance of a business depends on how it manages this asset like every other assets such as finance, humans, buildings, products, customers, etc. (Ward, 1995). The advancements of Information and Communication technology have provided various tools to effectively manage information. Using information and communication technologies, businesses and organizations nowadays rely largely on Information systems to store and manage and analyse data. Information system is a combination of various subsystems that coordinate with each other to collectively gather, store, manage, retrieve, distribute, and transfer information. Information systems help businesses to enhance their productivity by increasing the efficiency and value of business processes (Porter & Millar 1985).

Using information technology tools for managing information in conducting business is referred to as E-Business. E-business is a very wide concept comprising of different aspects of business transaction or transferring information by means of Internet. E-business can be classified into three categories. It can be within an organization which may include of various information systems such as Accounting Information System, Knowledge management system, Decision support system, Executive support system, etc. This type of communication technology is called Intranet. The standards used for Intranet are the same as for Internet communication. Accessibility to the Intranet is limited to organization-specific applications or web sites. These web sites and applications are protected against any unauthorized personal by firewalls and other security measures. The second category is involves business-to-business (B2B) communication conducted via Extranet. The Extranet integrates two Intranets which are inter-connected to each other via Internet, which facilitates two separate organizations to communicate and share confidential data. Thirdly category is the business-to-consumer (B2C) communication which occurs over the Internet. The business-to-consumers activity is the most prominent feature of e-business (Amor, 2001).

Purpose of Information Systems

The purpose of an information system is to empower its users. There is a wide difference in a simple database which stores data and return it to its users upon request. A database can be created in a way that manages and retrieves information in a sorted manner. This information can help make decision at various levels within an organization. Information system recognize that there are different levels of workers in an organization who have their specific duties and thus provides them information is different ways (Heinrich, 2002). Its purpose is to make sure that the users of the system are quickly able to access, comprehend, and react to the information provided to them. Wiseman (1985) mentions that the information system improves business functionality by automating some of the fundamental information procedures. He further mentions that the information system increases the effectiveness of the management by satisfying their information demands.
Information demands of businesses vary at different organizational levels. Various business functions at strategic, tactical and operational level have different types of subsystems of information system to serve their information demands. Some of the commonly used subsystems are as follows:

• Management Information Systems (MIS)
• Decision Support Systems (DSS)
• Knowledge Management Systems (KMS)
• Expert Systems (ES)
• Executive Information Systems (EIS)
• Transaction Processing Systems (TPS)
• Accounting Information Systems (AIS)

E-commerce

An important component of the information and communication technology and indeed one of its most momentous impacts is the provision and empowerment of electronic commerce. Electronic commerce is a process of buying and selling of products or services by means of electronic systems involving the Internet and e-mails (Graham 2008).
Commercial activities performed through e-commerce are either business-to-business (B2B) or business-to-consumers (B2C). E-commerce is a very cost-efficient mode of conducting business-to-consumers commercial activities (Graham 2008). E-commerce allows economic agents to reduce the transactional cost to a great extent (Porter 2001). Instead of internal hierarchies, it empowers the market itself to organize economic activities, which in turn increases the efficiency of the not just the business but across the entire commodity chain (Malone et al. 1987).

E-commerce creates a dimension of ‘spacelessness’ for economic activities which is one of its most distinctive features. Since the emergence of the Internet and increasing use of e-commerce, the imminent “death of distance” and creation of an ‘eight continent’ has been highlighted by researchers which is spurred by the increasing trade and commerce activities conducted electronically. They assert that constraints such as space and distance are becoming less significant for conducting economical activities (O’Brien 1992; Cairncross 1997). A large literature exits regarding various firms having used e-commerce to achieve competitive advantage by finding new and distant customers (for example see Daniel and Grimshaw 2002; Hamill and Gregory 1997; Kim and Mauborgne 1999; O’Keefe et al. 1998; Poon and Swatman 1999). Thus information systems also serve the purpose of communication with external business entities for trade and commerce activities.

Analysis of the problems of gathering data and analysing information

Information systems are a vital tool in achieving competitive advantage for a business by properly managing and analysing the information. However there are many security concerns that have being in the corporate agenda since its early usage. Today organizations are challenged by various and complex information security matters for handling distributed computer networks. Large amount of e-commerce activities, increased usage of internet, and ever changing technologies means new threats and risks and vulnerabilities for businesses as more and more business functions and procedures are becoming paperless. For this purpose, right controls are required within an organization to reduce the risks and ensure effective functioning of the information systems (Sushil & Leon, 2004).
Information Systems requires certain controls to be implemented for its smooth and effective functionality (Boczko, 2007). Information security managers can put these controls in place to ensure the system is secure against threats, exposure, and risks. (Gertz, 2003).

• A threat can be any possible unwanted occurrence or event that could harm the Accounting Information System or the business.
• The exposure is the possible loss of money that would occur as a result of the threat becoming a reality.
• The risk is the chance that the threat will become reality.
The controls that secure information systems against unfavourable outcomes are as follows:
• Preventive Controls
• Input Controls; Input controls checks upon the information that is being entered into the system.
• Processing Controls; Processing controls checks whether the data is processed properly after it is entered in to the system.
• Output Controls; The output controls ensure the completeness, validity, and accuracy of the data in various output mediums.
• Storage Controls; The storage controls ensures that the data in stored in such a manner that it cannot be tampered with.
• Files Controls; Files controls reduce the errors that occur due the improper storage of files.
• Hardware Security; Hardware security control is very important as any damage or harm to the hardware would mean that the failure of the system therefore the hardware for the information system must be kept in a secure place and with only reliable and relevant personal having access to it. Proper protection against high temperature or power failures and incidents should be made along with backup support.
• Standardization; Standardization controls involves usage of already laid down standards by the developers and operators for the methodology of the system development and operation respectively.
(Basset, 1993)
• Detective controls
• Testing; Testing is required to detect any problems occurring in the system and is thus performed before it is made operational. Testing can shows problems that can occur in the processing and any other errors. It is recommended that testing should be performed on a routine basis or after any new developments.
• Training; the training of the data processing staff ensures proper functioning of the system. The awareness of the staff also helps in pointing any defects in the system which could then be resolved.
• Operation Controls; Operation controls in Dean Plc are controls which record what computer systems and the employees have been doing. The operational controls can include tasks such as rotation of shifts, duty logs, manual of operating instructions, attendance controls and computer logs, etc. which can referred to whenever a problem is reported.
(Basset, 1993)
• Corrective controls
• When any problem in the system is detected, the management along with the help of Business Analysts and Expert can take relevant steps to correct the problems in the system.
• Certain procedure can be set for reoccurrence of the problems.
Apart from security concerns, there are several other challenges and issues associated with managing information systems. These are:
• Increase costs of a technological solution (developing, implementing and maintaining of the information technologies and systems)
• Reliability for certain processes (information systems require thorough testing before they could be used and are difficult prone to errors leading to potential losses)
• Software tools are not fixed but constantly evolving (information communication technology tools require timely upgrades to meet prevailing standards)
• Integrating digital and non-digital sales and production information (for e-commerce activities)
• Customer fear of personal information being used wrongly (privacy issues)
• Customer have high expectations regarding efficiency and real time responses
• Vulnerability to fraud and other crimes
• Higher employee training required to effectively using the information technology.

Another technological concern regarding information technology is the high volume of data generated from its use and its management. Organizations are required to create robust middleware application that are capable of handling the high amount of data and route it to the appropriate information systems in a timely manner (Ngain and Gunasekaran 2009).

Major sources of relevant data used for management information systems

As mentioned previously, businesses and organizations have a variety of information requirements. Executives at strategic level require information to help them with their planning and strategic decision making. They require a summarized form of information that can give an overview of the business. Middle management requires more detailed information in order to oversee and control business activities. Operational level employees need basic routine information to carry out their day to day duties. Therefore, businesses have several information systems working altogether at the same time. Different information systems have different sources of gathering data according their purpose. The following presents a list of most commonly used information system and their likely sources of data and users.

Executive Support Systems

Executive Support System helps the senior management of an organization in making strategic decisions. Executive Support Systems shows the status of all key business activities and involves large data analysis to help strategic decision making. Therefore, it is likely to have information from all the internal and external sources which is gathered, analysed and summarized for strategic decision making. Internal sources include information collected from other information systems. External information system can include external data gathered by e-commerce activities, external market analysis and etc.

Management Information Systems

Management information system is concerned with the summarized data of the business transactions that helps middle management to monitor business activities. Therefore it is likely to have information from all the internal sources such as transaction processing systems. It summarizes information into management reports.

Decision-Support Systems

Decision Support Systems are designed to assist middle and top level management in making decisions at uncertain conditions. It informs the user about the possible consequences of their decisions. It gathers internal information to analyse the available options and alternatives. It has a predefined set of logic which is part of its design. It uses complex tools spreadsheets, and databases for creating ‘what if’ models.

Knowledge Management Systems

Knowledge Management Systems are created to help organizations and businesses create and share information. The source of such information systems is typically the employees who create new knowledge through their own expertise and then share it along with others within an organization. This share pool of information is created to search new commercial opportunities. Examples of such information systems are web-portals and Intranet portals created by professional lawyers, management consultants and etc. these information systems categorize and distribute information efficiently among users. Information could be contained in any form and formats such as word processed documents, presentations, web pages and etc.

Transaction Processing Systems

Transaction Processing Systems are created to process daily repetitive activities and transaction in an automated efficient manner. The automation increases the accuracy of the information. A business usually involves several reoccurring transactions. Therefore, there are several Transaction Processing Systems such as Billing systems, Payroll systems, Inventory management systems, etc. The sources of these information systems are the employees at the operational level or the organization. Sometimes automated identifications are also used to input data to these systems such as Radio Frequency Identification.

Office Automation Systems

Office Automation Systems are tools that help improve the productivity of employees processing data. Such systems usually work as standalone programs and do not link data to other information systems. Examples of such systems include Microsoft Office Tools, and Computer Operating Systems.

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1.0 Critical Recent Development

As this is being written Carphone Warehouse is part of

The Carphone Warehouse Group PLC

which consists of the Carphone Warehouse, a retail and distribution business and Europe’s leading independent retailer of mobile phones and services with over 2,400 stores in 9 countries and TalkTalk Group a fixed line telecommunications business that is currently one of the UK’s largest broadband provider with more than 4.1m broadband customers and 1.1m voice-only and narrowband customers. The two operations are being split into separate companies and it is planned that TalkTalk will begin trading as separate companies as of 29 March 2010. This obviously has had a major impact on the management and organizational culture as they preparations for the separation of the two elements of the company prepared to operate as individual entities. Each would by definition have their own managements, board of directors, and will develop a unique and individual corporate culture. It is also likely that there will be considerable shifts in management emphasis in the operation of the retail business.

2.0 The Management and Leadership of Carphone Warehouse

Carphone warehouse is in actuality a subsidiary of the US corporation Best Buy Co Inc as the result of a purchase and sale agreement with The Carphone Warehouse Group PLC consummated on 30 June 2008. Based on the Press release of 19 January 2010 Best Buy continues to operate The Carphone Warehouse in most respects as a separate and stand-alone business, but Best Buy controls it. In a dynamic situation such as the acquisition of CPW by Best Buy there is an obvious problem with the maintenance of management continuity even if there is not a turnover in personnel. The Best Buy relationship is unusual in that the company is still publicly traded in Europe, but is effectively controlled by Best Buy. There is also a close relationship with Best Buy’s European operations and it is difficult to actually separate them in terms of reporting and as entities. Combined with the sale of TalkTalk the internal situation must be very dynamic at this time. To understand the management dynamics of the company it is necessary to understand that it is involved in a very challenging period in its development with the sale of the TalkTalk group and its interest in Best Buy Europe that is basically a big box store operation compared to the historically physically small stores that comprised Carphone Warehouse operations.
The problem with the use of Carphone Warehouse relative to the questions of effective management and leadership development is that the company is going though a dramatic change in its operational format. Historically, the small stores involved close employee client interface. Essentially people came to Carphone Warehouse as much to get advice and help in choosing a handset and a service provider and provider plan as in simply buying a portable telephone handset. The stores were small, relatively easily managed and the relationships within the stores between “The Management” and the commission compensated employees were close and personal. The stores were usually staffed with a general manager and three or four sales associates. The stores typically comprise about 600 square feet and are open 60 to 80 hours per week and 7 days a week.

In contrast the Best Buy Big Box store in the US and Canada have 30,000 plus square feet, approximately 100-150 salaried employees and “grab and go” merchandise. It is clear that the required interface between the customer and the organization employee is far different in the two types of operation.

3.0 Leadership and Management

There is a huge body of research on the topics of leadership and management and the relationship between the two. Krishnan and Park however point out that, “researchers have confined their studies to exploring the impact of observable upper echelon characteristics, namely the demographic traits on corporate strategies and performance. The question is what characteristics are important in developing effective management in Carphone Warehouse. In a retail environment an effective management and leadership development programme is based on duplication. The basic Carphone structure is the small store with a single manager and few subordinates all of whom have the same responsibilities. These store manager reports to area managers who report to district managers in a classic pyramid structure. The question here is not creativity or innovation, but following a successful formula in terms of operation and presentation of product to the customer. It is interesting that the duplication is if anything more important in the “big box” environment of the Best Buy store where there is minimal customer interface. Here the focus is on stocking the shelves, and creating displays according to predetermined plans and collecting and getting paid for the merchandise purchased. The management structure is more complex because of the larger number of individuals involved, but the duplication concept is identical. Tesco is a master of this, and all Tesco supermarkets look virtually identical inside in terms of layout and display. The underlying function of the management is to see employees do what they are told in the manner prescribed. The HRM model is almost martial. There are doubtless at headquarter and senior levels room for creativity, but for most of the employees duplication is the key to their responsibilities. The need for more knowledgeable salespeople is pointed out below in opportunities. This will however require extensive training in complex technology, which will be a challenge to management under the duplication approach to HRM.

4.0 SWOT Analysis

The

strengths

of the Carphone Warehouse operation are mass purchasing power as the largest vendor of portable phones in Europe, a well-recognised brand name with a good image, and pervasive presence in the nature of vast numbers of retail outlets is desirable locations. The other key strength is the increase pervasiveness of portable information access devices. This same element will be used below as a weakness of the business model.

The

weakness

the Carphone Warehouse business model is embodied in the word phone in its name. It grew to its present size and prominence as a vendor of telephones, devices people talked to each other over. The modern “smartphone” like the iPhone is a far more sophisticated and complex device. It can obviously be used as a telephone, but it is effectively a personal communications device. It is rapidly becoming a pocket computer that provides navigation, games, Internet access and more new uses almost daily. As of the time this is being written there are 154,726 applications available for the iPhone, and almost 9,000 new applications are being added per month. This is a far cry from the simple original business model of Carphone Warehouse.

The growing importance of portable computing communications devices is also a huge

opportunity

for the operation. Most people already have at least a conventional mobile phone in Europe. According to “netimperative”, in October of 2008 there were 592 million mobile phone subscribers in Europe of 119% market penetration. As the consumer demands more sophisticated devices they will replace their existing phones with more expensive and complex devices and will require the assistance of knowledgeable sales people to guide them. It will also imply larger stores handling larger numbers of products with more personnel and higher skill and knowledge levels among the salespeople. If Carphone Warehouse can meet the challenge of recruiting and training the requisite human resources it will have a considerable competitive advantage relative to most outlets for mobile phones.

The increasing complexity of the technology is also a

threat

. With the development of net books, iPads, and a host of other devices that are not phones but offer many of the same capabilities the industry environment is and will continue to change dramatically. Carphone Warehouse is responding with a new “midsized’ Store format that will permit it to carry and display a far larger variety of devices the current relatively small stores can accommodate. The question is the existence of more than 2,400 existing small format stores that will not remain competitive in the new environment that is developing. These must be replaced or expanded to remain viable. This can involve a considerable capital outlay and considerable time. These existing stores may become uncompetitive before they can be replaced.

5.0 PEST Analysis
Political

considerations are minor in the Carphone Warehouse operation. Communications regulation could have an impact, but it probably would not have significant business implications for the operation. The

economy

is obviously a consideration in any retail operation and sales and profits will respond to the economic environment. Inventory levels and new store openings will doubtless reflect economic conditions to some extent, but the tech market has been relatively resistant to the current economic softness. The

social

impact of tech developments such as social networking will obviously spur conversion of existing phones to more sophisticated handsets.

Technology

is having an impact on society as great as mass production and the auto did in the 20th century. This can do nothing but help a company dedicated to the sale of products utilizing the rapidly developing technology. The elements of

social and technological

are key to the development and future of the company.

6.0 Developing an effective leadership and management programme

The key consideration in the development of Human Relations Management for a company such as Carphone Warehouse is the training of the salespeople to deal with the increased complexity of the products they are selling to what is, in large part, customers with limited knowledge and understanding of their products. In a retail operation there obviously is a cadre of trained and sophisticated managers and strategic planners at the apex of the pyramid, but for the bulk of the workforce the key is duplication. In the case of Carphone Warehouse the level of complexity of the training to produce this duplication will have to be far higher than that of a McDonalds, but is fundamentally similar. The use of commission compensation provides a strong element of incentive to learn and perform on the part of the staff, and should facilitate the effectiveness of the training program.

At the higher management levels the control of Carphone Warehouse by Best Buy implies that the development of management and leadership must originate with what is now effectively the parent company. The question devolves to the management and leadership of Best Buy.

References

148Apps.Biz. (2010). App Store Metrics. Retrieved from http://148apps.biz/app-store-metrics/
Best Buy Form 10-K filed April 29, 2009 for the period ending February 28, 2009 p.7
Krishnan, H., & Park, D. (1998). The Influence of Top Management Team Leadership on Corporate Refocusing: A Theoretical Framework. Journal of Leadership Studies, 5(2), 50.
Netimperative. (2009, September 17). Mobile phone market penetration across Europe. Retrieved February 12, 2010, from http://www.netimperative.com/news/2009/september/mobile-phone-market-penetration-across-europe/view
The Carphone Warehouse Group PLC. (2009). Annual Report 2009 [Brochure]. London: http://media.corporate-ir.net/media_files/irol/12/123964/AR09/CPW_AR09.pdf
The Carphone Warehouse. (2010, January 29). Press Release Circular and TalkTalk and New CPW Prospectuses. Retrieved February 11, 2010, from http://www.cpwplc.com/phoenix.zhtml?c=123964&p=irol-home

Appendix

The concept of duplication in training in large organizations is not discussed in any academic reference found. It is however a widely accepted principal in military training, franchising and multi-level marketing training. It simply is the concept that the trainee performs the same action in response to a given stimulus exactly the same way each time. The training is repeated until the desired response is produced each time the stimulus is applied. Military close order drill is a classic example. Troops are trained so that on the command “column left” every soldier in the group automatically turns left in the same way at the same point.

In an environment like Carphone Warehouse the training might include greeting each customer with the appropriate “good morning sir” or “good afternoon madam” as opposed to “can I help you?” It would also include extensive training on the qualities and features of each model of handset sold. The concept is that every customer in every store is greeted exactly the same way and provided with exactly the same information in the same way. This has been determined by the sales training department and disseminated throughout the operation. This does not preclude rewarding or recognising outstanding performance. Even the military gives medals for performance above and beyond the call of duty. What it does is standardize the product presentation so it is done in the most effective manner. With 2,400 stores, it is imperative that performance and procedure be standardized.

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Over recent years, a small number of key concepts have become very significant to Operations Managers.

Four of these concepts are:

Customer Care

Kaizen

Just-in-Time

Total Quality Management

Your task is to compare and contrast each of these four concepts, clearly describing each. Your work should help the reader to understand how each interrelates to the others and how, if properly applied, they will help any organisation to be a success.

In order to understand the four concepts of customer care, kaizen, just-in-time and total quality management, there is a need to understand operations management and what this entails in the relationship between the four concepts and operations management. It is vital to the task to understand the meaning of each of the concepts in relation to operations management as well as to the business in which it is situated.

Operations management is the area of business practice which is associated with the production of goods and services. It involves the responsibility of ensuring that business operations are efficient through the use of as little resources as possible and also that the customer requirements are met in and effective and efficient manner. According to Bartol et al (1998: p. 53), operations management ‘Is the function, or field of expertise, that is primarily responsible for managing the production and delivery of an organisation’s products and services.’

The main use of operations management is the management of the process that converts inputs into outputs. Every organisation has an operational function, because every organisation produces a good or service for its consumers. According to Slack (1999: p. 122), operations managers are ‘the staff of the organisation who have particular responsibility for managing some, or all of the resources which comprise the operations function.’

The main aim of operations management is to increase the organisation’s value added activities within any given process. This organisational aim is helped along by the four concepts mentioned earlier – customer care, Kaizan, Just-in-Time and Total Quality Management (TQM). Each of these concepts are integral to the productivity of the organisation and to its overall success within the business environment.

Customer service is often referred to as customer support operations and this provides the activities which support the customer in the use of the organisation’s products as well as providing the means by which the equipment is serviced. Customer care is the after sales service which is often regarded as the need to satisfy warranty requirements. According to Slack (1999: p. 30) many organisations mistakenly believe that this is relevant after a sale has been made, ‘However, customer service and support is influenced by, and should influence, earlier stages in the contact with customers and the design and production of products. This philosophy is one of a consistency of service for customers by means of a designed and built-in serviceability of products.’

The role of customer care should be an integral part of the organisation’s service strategy. Customer care is driven by three factors:

It’s initial purchase price

The cost of failure to customers, and

Its reliability index.

Customer care is important to any organisation and in order to gain customer approval, the organisation must concentrate on not only the quality of the product or service but also on the customer service both while the customer is in the process of buying the product but also in the aftercare period of the product.

Kaizen is the Japanese word for improvement and refers to the philosophy that focuses on continuous improvement in manufacturing and business activities. The concept of Kaizan was implemented first in Japan during the post-war economic miracle and has spread through the global business environment. Kaizan refers to the continual improvement of all the business functions of the organisation, from the manufacturing of the product to the management of the organisation, from senior management to assembly line workers. Kaizan’s aim is to eliminate waste through the improvement of standardised business activities and processes. The process of Kaizan when completed correctly ensures that the workplace is humanised and sees the elimination of overly hard work, and through this process increases productivity. In order for the concept of Kaizan to work, there is the need for the participation of all of the organisation’s employees from senior management to the assembly line. The key elements which are crucial to the process of Kaizan are

Quality

Effort

Involvement of all employees

Willingness to change

Communication.

It is important to the concept of Kaizan that the theories of teamwork are established as well personal discipline and an improved morale from the employees as well as the establishment of quality circles and suggestions for improvement.

Just-in-Time is the modern day Western approach which has been developed from Japanese companies in the 1950’s and 1960’s. The primary objective of Just-in-Time is to make the time between the order of the customer and the payment of cash. Just-in-Time is the process which is the integration of philosophy and techniques which are used to improved performance. According to Slack (1999: p. 85) ‘only the customer is free to place demand when he or she wants: after that the JIT system should take over to assure the rapid and co-ordinated movement of parts throughout the system to meet that demand.’

The key philosophy behind Just-in-Time is to squeeze out waste at every junction. Waste, by definition in this context is defined by any activity which does not add value. Just-in-Time can be defined as a quest for superior performance manufacturing. Just-in-Time operations are done as and when they are needed. According to Waters (2002 p. 454) ‘In essence, just-in-time or JIT organises all operations so the occur at exactly the time they are needed. They are not done too early (which would leave products and materials hanging around until they were actually needed) and they are not done too late (which would give poor customer service).

The management philosophy of Total Quality Management (TQM), according to Slack (1999 p.224) embraces ‘all activities through which the needs and expectations of the customer and the and the community, and the objectives of the organisation are satisfied in the most efficient and cost effective way by maximising the potential of all employees in a continuing drive for improvement.’

Total Quality Management places emphasis on the planning and organisation features which are integral to the quality improvement process. There is a need for a long term approach for Total Quality Management which needs to be integrated with the other strategies such as information technology, operations and human resources, organisational business plans etc, in order for the business to compete within the environment. For the Total Quality Management process to be successful, effective use of the quality systems and procedures are imperative to the running of the system. Total Quality Management has become a particularly important development and the effects of this process are likely to remain in good organisations. This concept is the realisation that poor quality can cost the organisation in terms of cash and loss of the future market share, whereas excellent quality can offer the organisation a definite competitive advantage.

These four key concepts of operations management are essential to operations managers in determining the future of the business and are important in significance to the nature of success of the business and how it is run. All four concepts of customer care, Kaizan, Just-in-Time and Total Quality Management are all interrelated to each other through their respective processes and if these concepts are properly applied they can guarantee the success of the organisation. The concepts are all essential to the workings of the organisation and these concepts are overseen by the operations manager. The concept of customer care is seen by the operations manager as essential to the overall success in the organisation through the value which the product or service has added as well the aftercare service which is provided whether this is by technical support or through a warranty which the organisation has provided. According to Bartol et al (1998: p. 588) on the subject of managing customer contact
‘Experts argue that the degree to which a service can be efficient is directly related to the extent of the customer contact.’ This can be related to the other concepts especially with regards to wastage. The more time the employ has to manage contact with the customer, the more time they are neglecting other aspects of the operation. Contact with the customer can lead to a greater prospect of requests from the customer, changes in the instructions which had been finalised or the desire for the customer to chat can be seen as wastage. The role of the operations manager is to control this contact in a manageable and reasonable fashion so that there is no major loss to the company.

This in turn can be linked to the Just-in-Time system which controls the inventory as described by Bartol et al (1998: p. 565) ‘an approach to inventory control that emphasises having materials arrive just as they are needed in the production process.’
It is important in supply and demand as well as the value chain when adding value to the service, the product and the company that this inventory system is vital to the successful running of the organisation. This inventory system is also overseen by the operations manager and like customer care it is necessary to allow little wastage in order for the implementation of successful future planning. With the Just-in-Time system high quality is a vital necessity as the production is reliant on the materials being provided by the supplier in a timely manner. It is up to the operations manager to monitor and stay on top of this operation to allow production to be continuous.

In relation to the concept of Kaizan, it is up to the operations manager to guide their employees through the process. There is no set group through which Kaizan can be initiated, it can be through the individual, a small group or a large group. Through this concept of Kaizan, the process can generate in organisations Total Quality Management and helps free up the efforts through improvements in productivity through the organisation’s employees. Total Quality Management as part of the operations management process is important in conjunction with the other three concepts. Bartol et al (1998: p. 544) defines the process as ‘A management system that is an integral part of an organisation’s strategy and is aimed at continually improving product and service quality so as to achieve high levels of customer satisfaction and build strong customer loyalty.’

All four of these concepts are interrelated and cannot be separated from each other in a successful organisation.

It is important that the operations manager understand the needs for these concepts and how they affect the overall success of the business and how both customer loyalty and employee morale are important to the direction of the organisation for future planning. It is important to the role of the operations manager for these concepts to be installed in the organisational ethos and so that they are not separated and can be worked in conjunction with each of the concepts. The role of the operations manager within the organisation is to oversee the production side of the organisation and with the four concepts implemented successfully, this can place both a greater emphasis on future planning and success of the organisation as well as building customer loyalty and employee morale, therefore allowing the organisation, the customer and the employee to have an element of satisfaction.

Bibliography

Bartol, K.M., & Martin, D.C., (1998) Management, McGraw Hill
Bettley, A., Mayle, D., & Tantoush, T., (2005) Operations Management: A Strategic Approach, Sage Publications/ The Open University
Bicheno, J., & Elliott, B.B.R., (2002) Operations Management: An Active Learning Approach, Blackwell Publishers Ltd
Brown, S., Blackmon, K., Cousins, P., & Maylor, H., (2001) Operations Management: Policy, Practice and Performance Management, Butterworth-Heinemann
Greasley, A., (2008) Operations Management, Sage Publications
Lewis, M., & Slack, N., (2003) Operations Management: Critical Perspectives on Business and Management, Routledge
Lowson, R.H., (2002) Strategic Operations Management: The New Competitive Advantage, Routledge
Needham, D., Dransfield, R., Harris, R., & Coles, M., (1995) Business for Higher Awards, Heinemann
Shim, J.K., & Siegel, J.G., (1999) Operations Management, Barron Educational Series
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Waters, D., (2002) Operations Management: Producing Goods and Services, FT/ Prentice Hall

This work was produced by one of our professional writers as a learning aid to help you with your studies

Is leadership a skill that can be taught or is it an innate ability that only a few can possess?

The question that leaders are born or made has long been debated in the academia (Avolio, 2005). Like the debate on chicken and egg this debate has become timeless. Researchers have taken sides proving one point over another for many decades. Before venturing into answering this question a discussion as to what leadership is according to the major theories of leadership will be undertaken.

What is Leadership According to Major Theories?

The question “What exactly is Leadership” was asked when leadership started gaining acceptance as a subject in the early 19^th century (Stogdill, 1974). The subject of leadership needed content and definitions, and this led to the emergence of early theories of leadership known as The Trait Theories. In the absence of a well-documented research on the subject the researchers looked at live subjects (leaders) around the world and came up with most common traits among them (Costa and Mccrae, 1998). Kirkpatick and Locke (1991) concluded that the great leaders may have many different traits but common traits among them make them great leaders. Some of these traits were recognised as honesty, confidence, job related knowledge, and ambition. The trait theories simply perceived the appearance of leadership. They helped to make leadership an academic subject and laid the foundation for further research. The theory looked at the aspects which distinguished the leaders from their followers and came up with certain traits. The theory’s basic assumption was that since traits are acquired by nature, leaders are born. Anyone who possess specific traits can become a great leader (Northouse, 2012) . However the theory came under criticism in the 1940’s when researchers started proving that not everyone with these traits can go on to become a leader let alone a great leader. The specific criticism of the theory was that if traits are the only facet predicting the leadership then organisations just need to hire the people with the right traits and achieve great results with exceptional leadership, however in reality this was not the case ( Hogan et al., 1977).

Yukl and Van Fleet (1992) noted that the criticism on trait theories led to the emergence of another school of thought known as behavioural theories. As the name states the behavioural theories focus on specific behaviours rather than traits. It looked at what leaders do rather than what qualities they possess. Where on one hand the traits are believed to be inborn, and on the other the behaviours are believed to be learned over a period of time. The earliest theory in the behaviour school of thought is Kurt Lewin’s (1944) theory of Autocratic, Democratic and Laissez-faire styles of leadership. In this theory Lewin identified that leaders have specific leadership styles which have been learned over a period of time. One of them was the Autocratic leadership style which believed on giving orders and expecting the orders to be obeyed. No questions are likely to be asked and followers only do what they are told. The specific style can be seen in armed forces around the world where soldiers only obey the orders without asking questions. The other style he suggested is known a Democratic style, which is currently followed around the world in democracies. Democratic leaders take into consideration the opinions of stakeholders or the representatives of stakeholders and take decisions accordingly (Lewin, 1944). Conger and Kanungo (1987) noted that the basic assumption of behaviour theory was very different from the trait theories. Behaviour Theories basically assumed that leadership is not about the traits but it is about the behaviours which means leaders are not born, rather they can be trained to become good leaders. Lewin’s theory was followed by Black and Mount’s Managerial Grid Theory, University of Michigan Theory, and Ohio State University Theory, all focusing on certain behaviour of leaders, majorly known as production and people oriented styles of leadership ( Davis and Luthans, 1980).

The behavioural theories were replaced by contingency theories in the 70’s. Although the behaviour theories presented a logical answer to what is leadership it came under heavy criticism when researchers proved that one style of leadership will not work in all situations. An example was famous corporate leader Al Dunlap, Dunlap famous of his tough an autocratic approach was often hired by companies who were looking to revive, downsize and get back on track after heavy loses. Dunlap always helped the companies with ruthless axing of employees, freezing salaries and cutting back costs. He helped several companies till he ended up in a company which was doing just fine in the market. However due to his autocratic style he soon became unpopular and loyal employees started leaving the company due to his attitude. This led to the eventual firing of Dunlap from the company. This real life example is one of many where a certain behaviour did not work due to a different situation (Robbins and Judge, 2012). Yukl (2002) commented that contingency theories basic assumption was that leaders have to adopt certain styles of leadership according to the situation. The most famous theory of it is Fiedler’s model which suggested that a leader’s style is fixed, which is either production oriented or employees’ oriented, but the situation can change. The situation was defined by leader member relationship, task structure, and position power. The theory, supported by research, suggested that every situation requires a different kind of leader’s style. It was proven by research that a situation in which leader member relationship is good, positon power is strong, and task structure is high, a leader with production oriented approach will perform best (Fiedler, 1967). Another famous contingency theory was situational leadership theory which suggested that the leader has to change its style according to followers’ readiness. Followers readiness was defined as the extent to which followers are able and willing to do something for the leader (Graeff, 1983).

These famous theories define leadership in different ways. It is hard to find an agreement on one common definition of leadership in the literature. However when we differentiate between a leader and a manager we find agreements that a leader has followers not subordinates and a leader inspires and does not authorise, lastly a leader gives vision towards achievement of a common goal.

Leadership can be taught or it’s an inborn ability:

After concluding what is leadership the next question that needs answering is are leaders’ born or made?

The “Made” school of thought over a period of time has gained popularity. One survey among the top executives of government and private sector organisations in the USA suggested that 54% believed leaders can be made while 19% felt they were born and 28% thought they are both born and made ( Stringer, 2004). Ruvolo et al. (2004) claimed that since the early theories looked at the appearance of leadership they believed that leaders were born. The examples were taken from great leaders of that time including Martin Luther King and Gorge Washington. The researchers who believed that leaders are born strongly believe that nature plays a much higher role in personality development as compared to environment, education and training. One very famous example quoted by these researchers is the study of twins separated at birth. This study took 100 sets of twins who were separated at birth due to different reasons. The separation meant that these twins were brought up by different people, they had different education and environments at home. Logically the choices that these people made in life later should have been influenced by the way they were brought up, but the study proved otherwise. With several examples from the 100 sets it was seen that the twins, although separated at birth, had striking resemblances in the choices they made in life. One set of twins (men), 30 years later, had the same model of car with the same colour, they both owned a dog with the same name, and they both had similar choices in holidays (Newman et al., 1937). Another famous study in this regard was done on young children. These children, all under 5, were judged for the traits they possessed. The study revealed that their dominating traits such as shyness, confidence, and arrogance was adopted from their genes, which meant someone in the family from maternal or parental side had these traits ( McCrae et al., 2000). These two studies have presented evidence which suggests that leadership is a born trait and only a few may possess it. Over the years other studies have taken place which have focused on proving the same.De Neve et al. (2013) described a study conducted at UCL which suggested that the people who had supervisory positions in companies had a Gene called RS4950 in them. The critics of such research claim that these studies are flawed and they only consider a certain number of variables while ignoring the others that may play a considerable role in leadership positions. For instance there is a possibility that many people with Gene RS4950 have no supervisory or leadership positions and they may be living their normal lives. However since the research did not consider including such people in their sample the research is flawed ( Parkay and Hall, 1992).

The other school of thought which believes that leaders are made have their own arguments for it. This school of thought simply argues that if nature plays its role in creating great leaders, for example, why a certain region or country has more leaders as compared to others. For instance current fast developing countries such as China, Malaysia and Turkey are producing effective leaders which are helping these countries progress. On the other hand most of the countries in Africa and some in Asia (such as India and Pakistan) lack supply of effective leaders right now (Ridley, 2003 ). Gregersen et al. (1998) similarly suggested that majority of Fortune 500 companies belong to America, for which the credit is given to the exceptional corporate leadership. This shows that the culture, education, and training plays more of a role as compared to genes of a leader. Day (2001) emphasized that this school of thought feels that culture and education help people gain certain skills. One of these skills is leadership which is seen more in some countries as compared to others. A study in different universities in America revealed that Stanford University produces the highest number of entrepreneurs in the country. This study shows that education and skills developed at Stanford are different as compared to other universities in America and that’s why they have the highest number of entrepreneurs ( Eesley and Miller, 2012). Again, this strengthens the belief that the nurturing of an individual will play a vital role in taking and acquiring the leadership skill as compared to nature. Another study by Goldsmith and Morgan (2004) researched 88,000 managers who participated in leadership development programs. These programs were focused on teaching managers how to be effective leaders. Interestingly many of these managers came back from training and applied the knowledge learned in their professional lives. On the other hand the managers who did not go through the program showed no improvement (Goldsmith and Morgan, 2004). However the critics of this school of thought ask the question if the leaders can be made why does everyone not go on to become a leader? The question seems logical considering that even the best universities will produce 15-20% exceptional corporate leaders who will become the pride of the University, but what about rest of the 80% people, why do they not assume leadership roles ( Goleman, 2003). Nurture et al. (2004) answered the question by claiming that leadership in a group of people is like a bell curve, in which the bottom 15% will not have the potential and ability to acquire this skill. The top 15-20% are the exceptional talent who do not need leadership development. However it is about the vast majority that lies between top and bottom 15%, who if trained well, can acquire the skill of leadership.

Conclusion:

It is hard to conclude a debate which has such strong arguments and research to support both sides. There is no denying the fact that nature plays a vital role in leadership. Many traits are seen commonly in great leaders. These traits have helped us identify what leadership is. These traits have also helped organisations recruit the right people. However nature may not be the only answer to effective leadership. Looking around and going back in history it can be seen that leaders come from different places, different background and a leader’s children will not always turn out to be leaders. On the other hand it is noted that certain cultures instil confidence in children at a very early age, they develop opinion and often go on to make better choices as compared to children who come from a culture where choices are imposed and respect is so embedded that it stops them from asking questions and they end up making poor and limited choices in life. There is no denying that some people are born leaders, but there are no universally accepted traits which define the born leadership. On the other hand training and development focus on producing leaders without the assumption of born traits and produce better results. So it can be concluded that nature and nurture both play a role in leadership, however nurture has a more important role as compared to nature.

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Introduction

Statt (2000) defines motivation as “a general term for any part of the hypothetical psychological process which involves the experiencing of needs and drives and the behaviour that leads to the goal which satisfies them.” In essence, the motivational theories provide explanations as to why people behave the way they do. This paper explores the importance of motivation as a management skill. In so doing, it delves on the major motivation theories and subsequently identifies which of those theories have been proven effective within the context of management. The structure of this paper is as follows: first, it identifies and explains the following motivation theories: need theories; expectancy theory; equity theory; and goal setting theory. The need theories include the following: Maslow’s Hierarchy of Needs Theory, Alderfer’s ERG Theory, Herzberg’s Dual Structure Theory and David McClelland’s Need Theory. Next, it evaluates the effectiveness of the abovementioned motivation theories in the development of management skills.

Motivation Theories

In 1953 Viteles insisted that in the absence of a good theoretical foundation, applied research follows a path of trial and error; and becomes misdirected and inefficient. Indeed, there has been a significant body of literature that delved on the theories of motivation. These diverse motivation theories helped identify and determine the myriad of factors that drive people to behave in particular ways. There are numerous motivation theories with more than one may of grouping or classifying them. However, the most common one is to classify them according to four general types, namely: need theory; expectancy theory; equity theory; and goal setting theory. These are considered as the formal motivation theories. Additionally, there are also some informal motivation theories that are classified under the following general classes: (1) Theory X; and (2) Theory Y.

A. Need Theories

Need theories buttress the assumption that people have “psychological needs arising out of, though going far beyond, basic biological drives like hunger, thirst, sex or the avoidance of pain” Motivation in this case, is referred to the content of satisfying such needs; and the need theories are referred to as the ‘content theories’. Maslow’s Hierarchy of Needs Theory, Alderfer’s ERG Theory, Herzberg’s Dual Structure Theory and David McClelland’s Need Theory all belong to this group of theories.

1. Maslow’s Hierarchy of Needs Theory –
According to Maslow, there are five key categories of needs that are arranged in a hierarchy. Needs belonging to the lower levels must be satisfied first, “before the higher level needs become important.” Physiological needs (e.g. food, water, air) occupy the lowest level in the hierarchy. This is followed by the safety needs such as security, freedom from danger, good health, etc. Next, are the social needs which are exemplified by love, affection and group acceptance? Next are the esteem needs which are achieved through “recognition and respect from colleagues and by voiced approval from others.” At the topmost level are self-actualisation needs which are associated with skills and potentialities; and “relate to finding self- fulfilment opportunities on which to build a career.”

2. Alderfer’s ERG Theory

Alderfer’s ERG theory is similar to Maslow’s Hierarchy of Needs theory. However, instead of five key categories of needs, the ERG theory only has three major needs categories, namely: (a) existence needs, which are the same as the physiological needs in Maslow’s Hierarchy of Needs theory; (b) relatedness needs, which are associated with successfully relating to others; and (c) growth needs, which are associated with self-development and growth. These three needs categories are also arranged in a hierarchical manner.

3. Herzberg’s Dual Structure Theory

This theory posits that “motivation factors affect one dimension, ranging from satisfaction to no satisfaction.” This theory groups needs into two general categories, namely: hygiene needs and motivator needs. Moreover, this theory assumes that people’s attitudes toward aspects of their jobs that are regarded as motivators, influenced job satisfaction and not motivation. These are referred to as hygiene factors, which include the following: interpersonal relations, company policies, working conditions, supervision, and salary and benefits. On the other hand, the motivators include the following: “achievement, independence, recognition, and responsibility, challenge and so on”. This theory is particularly applied in a technique used for structuring employee tasks called ‘job enrichment’. Herzberg’s Dual Structure theory suggests that managers adopt a two-stage process, wherein the first stage requires the elimination of factors that cause dissatisfaction in order to enhance motivation in the workplace; and the second stage necessitates increasing opportunities for “achievement, recognition, responsibility, advancement and growth.”

4. David McClelland’s Need Theory

The Acquired Needs Theory posits that certain types of needs are acquired during a particular individual’s lifetime. Hence, people are not automatically born with such needs, but acquire them through their various life experiences. These needs are grouped into the following categories: (a) achievement needs; (2) affiliation needs; and (3) power needs. McClelland explains that people with a strong need for achievement are more likely to enjoy entrepreneurial and innovative activities; while those who have a high need for affiliation are commonly successful integrators; and those that have strong power needs often attain top levels in the organisational hierarchy.

B. Expectancy Theory

The Expectancy Theory presupposes that motivation is largely dependent on an individual’s mental expectation about their ability to perform tasks and subsequently receive desired rewards. In contrast to the needs theories discussed above, the expectancy theory does not focus on understanding the various types of needs, but rather, on the specific thinking process that individuals utilise in order to achieve their rewards. This theory places a particular focus on the relationships among the following factors: (1) the individual’s efforts; (2) the possibility of high performance; and (3) the desirability of outcomes arising from the high performance. Thus, in essence, the expectancy theory posits that motivation is largely dependent on how much a particular individual wants something and how likely that individual thinks that he is to get it. Moreover, this theory suggests that managers need to recognise that: (a) employees work for many reasons; (b) such reasons may change over time; and (3) “it is necessary to show employees how they can attain the outcomes they desire.”

C. Equity Theory

The Equity Theory presupposes that people are motivated to achieve and “preserve equitable treatment for themselves.” In this case, equity is construed to mean the “distribution of rewards in direct proportion to the contribution of each employee to the organization.” Hence, this theory focuses on “the exchange relationships among individuals and groups and the motivating effects of a perceived imbalance in the exchange.” This theory could be further exemplified in the following manner: first, an input-to-outcome ratio is developed by the individual concerned. Inputs in this case, pertain to the contributions of the individual to the organization such as time, effort, skills, education, experience, etc. Outcomes, on the other hand, pertain to the rewards that are obtained from the organisation such as “pay, benefits, recognition, and promotions.” Next, the individual compares the input-to-outcome ratio with what he perceives as the input-to-outcome ratio for some other individual, who could be a co-worker, or a friend working for another organization, or even an average person in his organization. If the two ratios being compared are approximately similar, the individual concerned may feel that the organization is treating him equally or fairly. On the other hand, if his input-to-outcome ratio is higher than that of the ‘comparison other’, he may feel under- rewarded and is, thus, motivated to make changes. Such changes may include decreasing his own inputs; try to increase his total outcome by demanding for an increase in pay; leave the organization; or carryout a new comparison with a different individual. Since pay is a most relevant outcome within the context of the equity theory, it suggests that managers avoid problems arising from inequity by ensuring that rewards are distributed equitably – that is, on the basis of employee performance; and that “ everyone clearly understands the basis of his or her own pay.”

D. Goal Setting Theory

The Goal Setting Theory posits that “behaviour is a result of conscious goals and intentions.” Thus, this theory was underpinned “on the premise that human action is purposeful, in that it is directed by conscious goals.” It has been observed that employees are more likely to be motivated to attain goals that are established by both their managers and themselves. This theory suggests that the manager must develop a thorough understanding of the goal setting processes of employees and the manner by which they attain such goals. Thus, in applying this theory, a manager can formulate and implement a reward system that “fit employee needs, clarify expectations, maintain equity and provide reinforcement.” Moreover, this theory essentially provides an understanding of the goal that a particular employee intends to achieve and the subsequent rewards that the employee could get if the goal is attained. The Goal Setting theory is characterised by two attributes, namely: goal difficulty and goal specificity. Goal difficulty is the degree or extent by which the goal becomes challenging and requires effort. On the other hand, in terms of goal specificity, “goal content can be vague (“work on this”) or specific.” It is recommended that a goal be specific, moderately difficult and one that the employees is motivated to achieve.

Effectiveness of Motivation Theories

There is a dearth in available studies that explore the effectiveness of motivation theories in the context of management in general, and in the development of management skills in particular. However, there are a few studies that explored such topics. One such research undertaking was the study conducted by Kini and Hobson in 2002 which evaluated the relationship between motivational theories and successful total quality initiatives. In particular, the researchers tested the effectiveness of the following motivational theories in the success of total quality initiatives: (a) Maslow’s Hierarchy of Needs Theory; (2) Alderfer’s ERG Theory; (3) McClelland’s Theory of Needs; (4) Expectancy Theory; (5) Goal Setting Theory; and (6) Equity Theory . In this study, the researchers constructed and distributed a survey instrument which was designed so that “the participants can enter a score between 0 to 10 to indicate the extent to which each of the item in the question was utilized in participant’s organization’s approach to total quality” and performed a regression analysis on the collected data. The results indicated that Maslow’s Hierarchy of Needs theory; Alderfer’s ERG theory; McClelland’s Theory of Needs and Equity Theory were ineffective in promoting “organizational commitment to employee morale, cross training and performance recognition.” In contrast, however, the results of the study suggested that “a combination of major elements in goal setting and expectancy theories were most likely to produce success in the implementation of total quality initiatives.” Hence, this study found that the goal setting and expectancy theories were indeed effective in developing management skills in terms of developing an effective system to monitor TQI progress; of facilitating clear communication of performance expectations; and empowerment of work teams. In contrast, however, in a study conducted by Tesone in 2005, it was found the Maslow’s Hierarchy of Needs Theory had significant implications “for managers in organisations from the standpoint of recruitment, selection, employee retention, and performance improvement.” The results of the study indicated that younger workers prioritise socialization needs, “only to be replaced by more self-actualizing and self-esteem needs with age.” Managers may employ this understanding of “human intrinsic needs to develop effective strategies in the areas of employee recruitment, selection, and retention, as well as performance management.”

Conclusions

The motivation theories discussed in this paper, namely: need theories; expectancy theory; equity theory; and goal setting theory; indeed have management implications, and thus, are deemed important as a management skill. For example, Maslow’s Hierarchy of Needs Theory can be used by managers in developing training programs that target the specific needs of the employees, for such training programs to be effective and subsequently produce positive outcomes. In the same vein , understanding of Herzberg’s Dual Structure Theory can help managers eliminate the factors that cause dissatisfaction in order to enhance motivation in the workplace; and subsequently increase opportunities for employee achievement. Similarly, an understanding of The Goal Setting Theory can enable a manager in formulating and implementing appropriate reward systems that meet employee needs, offer reinforcement and maintain equity. The Equity Theory, on the other hand, can help managers prevent problems emanating from inequity by ensuring that rewards are equitably distributed.

Indeed, the motivation theories explained in this paper has important management implications. However, there is a dearth in empirical studies that confirm the effectiveness of such motivation theories in management in general; as well as their importance a management skill. Thus, theoretically, motivation theories are important as a management skill. However, there is a need for further research in this area if we are to confirm such claims empirically.

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Stress is a major issue for modern businesses and managers in the contemporary working environment. Not only do stress related illnesses have a cost for organisations in terms of lost working hours and productivity, but higher levels of stress have also been associated with lower level of satisfaction, poorer quality service delivery, and higher levels of turnover (George and Zakkariya, 2015). This essay will thus look to carry out a critical review of theory and research into the various options and approaches which can be used to manage employee stress and ensure it does not reach an excessive level which could harm organisational performance and outcomes.

One of the main themes in the literature is the important role that an employee’s immediate managers, and particularly line managers, can play in the management of stress. According to Donaldson-Feilder et al (2008), as line managers are responsible for organising employees and directly supervising their work, they are ideally positioned to address their psychological needs and manage work related stress. This indicates that line managers need to ensure they have developed and are able to apply the necessary skills to the management of employee stress in order to maintain levels of moral and performance. At the same time, research indicates that senior managers need to focus on empowering line managers and giving them the necessary support and delegated authority to manage stress among their teams, in order to help employees “manage their stress proactively through planning, prioritizing and delegating work” (Moyle, 2006, p. 48). This is an important issue, given recent findings that many line managers are themselves too stressed to help their employees deal with work related stress (Crawford, 2013). This indicates that the management of stress is an issue which requires managerial involvement at all levels, as build ups of excessive stress in any layer of an organisational hierarchy can trigger additional issues and performance problems.

In addition to the direct management of stress, it is also important to recognise the role of leadership styles in creating an organisational environment in which the causes of stress are minimised. As noted by Huczynksi and Buchanan (2010), many managers continue to follow traditional supervisory leadership theories, through which they look to encourage and reward good performance and reprimand employees who fail to perform. However, there is a risk of this type of leadership resulting in an overly autocratic approach to the management of employees. A research study by Castledine (2004) showed that this style of leadership is associated with higher levels of stress, leading to a lack of commitment and risk of employee burn-out. This thus indicates one of the primary paradoxes in the management of stress, namely that a degree of stress is required in the form of pressure to perform and penalties for failure if employees are to be motivated to work hard, but above a certain level this stress can become destructive. As such, one of the core options for managing stress without eliminating it is to use transformational and participative leadership styles which will motivate employees to perform whilst providing them with support and motivation to avoid any issues of excess stress, and preventing a long term accumulation of stress which can cause damage to employee outcomes (Northhouse, 2011).

In addition to the specific style of leadership, it is also important to recognise the role of individual employee factors, both inside and outside the organisation, in influencing levels of stress and the negative impacts which can result. This is particularly important in light of recent developments in the nature of work, including flexible labour markets and the rise in knowledge work. According to Robbins et al (2010), this has resulted in a growth in employee expectations around the rights and the obligations of organisations and employees, and a demand for organisations to also recognise these rights. This can cause conflict between organisational and employee priorities, particularly in the area of work life balance, and the extent to which demands placed on employees by organisations are fair and reasonable (Sturges and Guest, 2004). This is of importance in the context of employee stress, given that research has shown that a positive work life balance is one of the major factors in preventing the build up of stress and helping support healthier lifestyles for employees (Gregory and Milner, 2009). Ensuring a positive work life balance, which does not place excessive demands on employees, is thus also key to managing levels of employee stress.

The role of work life balance in controlling organisational stress is also linked to the general literature around the growing importance of the psychological contract. Evidence from the literature indicates that the formation of a strong psychological contract between an employee and their manager and organisation can help to boost levels of motivation and thus drive higher levels of performance (Watson, 2001). However, the psychological contract is also based on a strong recognition of the role of the organisation in supporting the employee with any specific issues or circumstances, in order to make them feel more valued (Abendroth et al, 2012). A failure to manage the psychological contract can result in perceptions by employees that the organisation and its managers have broken the contract, which can increase levels of stress and the negative impacts of stress on organisational outcome (Houston et al, 2006). This indicates that managers must be attuned to the implied promises in the psychological contracts they have developed with their employees and must honour these promises or risk high levels of employee stress and associated dissatisfaction.

The ability of managers to identify and address these issues is also linked strongly to the level of managerial understanding around stress as an emotional issue. This in turn leads to the argument that managers who are able to deal better with stress and other emotional issues will be better at controlling them and reducing any associated negative impacts, causing Goleman et al (2002) to argue that emotional intelligence is now a vital competence for modern leaders. This argument is supported by Hughes et al (2005), who use theory to argue that emotional intelligence will help leaders to improve their level of understanding of the emotional behaviours and needs of employees, and thus allow them to respond to these issues in a supportive manner, building a more genuine relationship. This will thus improve the ability of managers to understand and address the causes of stress, helping to pre-empt the emergence of stress in the workplace. Managers can thus look to develop their emotional intelligence in order to improve their management of stress.

Unfortunately, whilst emotional intelligence is one of the areas of management competence which is seen as amongst the most prominent in the management of stress, it is also one of the most controversial. On the one hand, Sadri (2012, p. 535) states that “the components of emotional intelligence integrate with contemporary leadership development practices”, which supports the argument that emotional intelligence is key to the development of effective leadership which can help manage stress. However, research and arguments by both Antonakis et al (2009) and Lindebaum (2009) indicate that whilst there are strong theoretical arguments for emotional intelligence, there is very limited statistical evidence to support these arguments. In particular, Lindebaum (2009) argues that the value of emotional intelligence is generally supported through the use of hyperbolic claims around the value of this competence in the management of stress and achievement of positive employee outcomes, however the empirical support for these arguments is very limited. As such, whilst the management of emotional issues and their potential negative impacts is widely supported in the literature as a method of managing employee stress, the existence of a single competence or capability which can ensure effective management of these complex issues is less clear.

In conclusion, the literature indicates that there are a number of methods, techniques and approaches which can be used to ensure the effective management of stress. These include ensuring that line managers are empowered and trained in dealing with stress and are themselves protected from stress, and also ensuring that leadership styles are participative and transformational to ensure pressure to perform does not turn into high levels of stress. In addition to this, the organisation and its managers must support positive individual level factors such as work life balance and a psychological contract which establishes clear expectations and meets said expectations. There is also a strong argument that leaders and managers need to develop higher levels of emotional intelligence if they are to understand employee needs and emotional requirements and thus develop appropriate responses to address these needs and the stress they may cause. However, this argument is not well supported in the empirical literature, which indicates that the development of emotional intelligence may not be possible or feasible. Instead managers should look to respond to each situation individually and manage the stress which can result in order to keep overall levels of stress in their organisation at an acceptable level.

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Farm Management
Assess the current capacity of ‘Holly Farm’ and critically evaluate the optional ways of achieving the intended growth in the number of visitors, bearing in mind that capital investment is not available, although self-financing revenue earning ventures can be considered.
1. Introduction

This piece examines the case of Holly Farm, and the plan proposed by Gillian Giles to attempt to boost the number of visitors attending the farm. Holly Farm is currently quite a successful example of a farm that has diversified into visitor activities to boost its overall revenue levels. However, the farm has now reached a point at which visitor levels are relatively steady, and hence the farm is failing to grow its revenue significantly. This piece will thus investigate the current situation at the farm, including the current visitor numbers and the projected capacity for the farm. This data will then be used to determine the extent to which the farm can try to attract more visitors and the strategies that could be used to achieve this. This analysis will take place assuming that the farm is unable to raise further capital investment, other than through additional services that will also generate revenue.

2. Analysis and current situation
Car park capacity

Coach spaces

6

Car spaces

40

Average visitors per coach

35

Average visitors per car

3

Daily coach visitor capacity

210

Daily car visitor capacity

120

Total daily capacity

330

Current visitor numbers

April

May

June

July

August

September

October

Total

Visitors

1,200

1800

2800

3200

3400

1800

600

14,800

Days open

16

16

16

16

16

16

16

112

Weekend days open

8

8

8

8

8

8

8

56

Week days open

8

8

8

8

8

8

8

56

Average weekend day visitors

100

150

233

267

283

150

50

176

Average weekday day visitors

50

75

117

133

142

75

25

88

Daily car park capacity

330

330

330

330

330

330

330

330

Weekend utilisation

30.3%

45.5%

70.7%

80.8%

85.9%

45.5%

15.2%

53.4%

Weekday utilisation

15.2%

22.7%

35.4%

40.4%

42.9%

22.7%

7.6%

26.7%

Daily milking parlour capacity

200

200

200

200

200

200

200

200

Weekend milking parlour visitors

80

120

187

213

227

120

40

141

Weekday milking parlour visitors

40

60

93

107

113

60

20

70

Weekend utilisation

40.0%

60.0%

93.3%

106.7%

113.3%

60.0%

20.0%

70.5%

Weekday utilisation

20.0%

30.0%

46.7%

53.3%

56.7%

30.0%

10.0%

35.2%

The analysis of the current situation is based on the following assumptions:

On average, each coach visiting the farm will contain 35 visitors, and each car will contain 3 visitors. This is to account for the number of single parent families and families with only one child that may visit the farm.
The proportion of visitors by coach and by car are roughly proportional to the respective visitor capacity for coach and car visitors
The car and coach spaces cannot be used flexibly, i.e. coaches cannot park in the car spaces and vice versa
The milking sheds can support 80 people per hour for a period of two and a half hours, thus they have a daily capacity of 200
The visitors are spread roughly evenly throughout each month
90% of visitors arrive after 12:30pm, and the visitors that arrived before 12:30pm at still there at this time. As such, around 1pm all visitors to the farm are at the farm and hence all need a car park space

The analysis indicates that the farm is currently very close to its maximum visitor capacity in July and August, with 80.8% and 85.9% capacity utilisation in the car park on these days. With 80% of visitors going to the milking parlour, the parlour itself is already over capacity on these days, with capacity utilisation levels of 106.7% and 113.3% respectively. It must be assumed therefore that some visitors that would have liked to have visited the milking sheds were unable to do so due to the capacity constraints.

3. Different scenarios

Two primary scenarios have been considered. The first is where the farm engages in widespread promotional activity designed to boost overall levels of attendance by 50%. The second is where the farm engages in targeted promotional activity designed to encourage school visits during the week, thus boosting weekday attendance levels by 50%. The analysis for these two scenarios is shown below:

3.1 Boost visitor demand by 50% on all days
Projected visitor numbers

April

May

June

July

August

September

October

Total

Visitors

1,800

2,700

4,200

4,800

5,100

2,700

900

22,200

Days open

16

16

16

16

16

16

16

112

Weekend days open

8

8

8

8

8

8

8

56

Week days open

8

8

8

8

8

8

8

56

Average weekend day visitors

150

225

350

400

425

225

75

264

Average weekday day visitors

75

113

175

200

213

113

38

132

Daily car park capacity

330

330

330

330

330

330

330

330

Weekend utilisation

45.5%

68.2%

106.1%

121.2%

128.8%

68.2%

22.7%

80.1%

Weekday utilisation

22.7%

34.1%

53.0%

60.6%

64.4%

34.1%

11.4%

40.0%

Actual average weekend day visitors

150

225

330

330

330

225

75

238

Actual average weekday day visitors

75

113

175

200

213

113

38

132

Total weekend day visitors

1200

1800

2640

2640

2640

1800

600

13320

Total weekday day visitors

600

900

1400

1600

1700

900

300

7400

Total visitors

1800

2700

4040

4240

4340

2700

900

20720

Daily milking parlour capacity

200

200

200

200

200

200

200

200

Weekend milking parlour visitors

120

180

264

264

264

180

60

190

Weekday milking parlour visitors

60

90

140

160

170

90

30

106

Weekend utilisation

60.0%

90.0%

132.0%

132.0%

132.0%

90.0%

30.0%

95.1%

Weekday utilisation

30.0%

45.0%

70.0%

80.0%

85.0%

45.0%

15.0%

52.9%

It should be noted that, for this scenario, as the capacity of the car park is limited to around 330 people per day, some visitors who wish to visit the farm on weekends in July and August will be unable to do so. The farm will thus have maximum average daily weekend visitor numbers during these months of 330. A plan should thus be put in place to manage capacity on these days, and ensure that visitors do not travel a long way only to find there is no space in the car park.?

3.2 Boost visitor demand by 50% for weekdays only
Projected visitor numbers

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