Brunel’s Analysis and the Recommendable HRM Practices
Brunel Company has a lucrative business model. It produces cars’ engine parts independently. Therefore, its customers are comprised mainly of car manufacturers. This essay will analyze the internal and external environment accounting for its current state. The essay shows that the company’s internal environment’s positive aspects are hardworking employees and competent leaders. The negative aspects of the company’s internal environment are lack of employee engagement, poor staffing, task inflexibility, and a high employee turnover rate.
On the other hand, the external environmental component favoring the company is the opportunity for large-scale production. However, the company is also threatened by stiff competition, technological obsolescence, and inflation. Additionally, the essay aims at unveiling three HRM practices that positively impact the company’s future success. The three HRM practices are performance-based compensation, training, and performance appraisal human resource management practices. To increase the effectiveness of these human resource management practices in positively impacting the company’s future success, it should establish clear goals and create employee involvement plans.
SWOT Analysis is a suitable analytic method. Therefore, I have the leverage to analyze Brunel Company’s environment. SWOT Analysis stands for a company’s Strength (S), Weakness (W), Opportunity (O), and Threat (T). Thus, Strength (S) and Weakness (W) analysis have helped me study the company’s internal environment. Whereas, Opportunity (O) and Threat (T) analysis have aided me in studying the company’s external environment.
McGregor’s X and Y’s theories unveil practices of enhancing a conducive environment suitable for employees. It advises managers to give employees full work autonomy, less supervise the workers, and assign challenging tasks to the staff’s purpose of nurturing a hardworking culture (Galani and Galanakis 2022). Likewise, the company has established an influential employees-hardworking culture. The case study shows the company occasionally accepted very difficult or impossible orders for the existing staff to deliver to cultivate handwork. Additionally, the instituted culture of hardworking employees is attributed to the company’s hiring of skillful employees. Appraising, the company’s senior managers regard the employees as loyal, hand working, and committed. The company is happy with its staff working hard towards company objectives.
Transformational Leadership theory offers instructive notions characterizing an effective leader. It reveals a competent leader is charismatic and inspirational. Additionally, it shows a good leader initiates transformational changes and cultivates positive relationships with followers (Mach, Ferreira, and Abrantes 2022). Therefore, the organization has recruited capable leaders with desirable characteristics. For instance, the chief executive, Andy Brunel, is skilled since he interacts well with employees. The case study illustrates his routine remark that he wouldn’t trade his staff for anybody else’s; such a remark positively affects employee motivation and a sense of belonging.
In addition to the chief executive, the directors of Brunel are charismatic. They were amenable to my suggestion that people issues may be a means of adding value to the car manufacturers’ demand for quicker order times, lower contract prices, and high-quality standards. Additionally, the directors are inspiring. They recommended recruiting HR specialists to determine if staffing concerns threaten the company’s ability to meet auto manufacturer demand. According to the case study, the company recruited two qualified HR managers, Caroline O’Kane and Oki Adeyemi, on a project basis to examine the staffing issue. Caroline O’Kane was tasked with examining issues related to how people worked that could impair the company’s capacity to “deliver” in the new environment. On the other hand, Oki Adeyemi was only required to report on the current HR policies for cross-examination purposes.
The democratic leadership theory cautions managers against the seldom involvement of workers in decision-making processes. According to the democratic leadership theory, failing to involve employees fosters a hostile work environment characterized by low innovation, high staff turnover, and dissatisfied workers (Liggett 2022). The corporation disregards the democratic leadership theory’s dire warning and excludes its people from decision-making. As reported by O’Kane, its managers maintained a relatively tight grip on their respective departments, making decisions individually. Negatively, O’Kane remarked that by not involving employees in day-to-day decision-making activities, the corporation missed an opportunity to collect clear views on improving staff management. In addition, the organization had an issue with high levels of absenteeism; on average, 9 percent of employees reported having willfully missed work at some point.
SHRM discourages managers from employing conventional human resource strategies. It tarnishes the utilization of traditional human resource procedures since workers become less productive, competitive, and competent (Hamid, Muzamil, and Shah 2022). Nevertheless, the company employs conventional human resource methods. For example, the organization lacked an HR director with total responsibilities. In addition, it employs a human resource personnel officer with expertise in traditional human resource management. The HR personal officer pays employees using a fixed compensation plan instead of an incentive-based payment plan that fosters employee engagement.
The company fails to include bonus incentives that modern companies prevalently use to increase workers’ overall output. The case study reveals that the company banned production bonuses in the late 1970s and had not replaced them. Worse, the company uses the traditional performance appraisal method that emphasizes observing employees’ performance and regularly conducting performance appraisals for cost reduction. The case study reveals that the company held performance appraisals if the employees failed to meet the required tasks’ standards.
The company’s recruitment, training, and selection processes are outdated, accounting for a high turnover rate. Adeyemi shows that the recruitment processes are often achieved by word of mouth, while the selection procedures are carried out via informal references and interviews. He further unearthed that the staff is regularly dispatched on training courses if something relevant comes up, as opposed to regular training the employees to equip them with relevant skills. Finally, the company fails to unionize its employees fully for coordination purposes. Adeyemi’s findings note only 25 percent of employees are members of the Unite union, explaining why its staffing issues are undetected promptly. Due to low employee unionization, the union paid little attention to collectively negotiating the annual pay rise and complaints of employees’ grievances.
Strategic human resource management appraises flexible work policies. It recommends that managers establish flexible policies allowing free labor movement across departments for the sake of task effectiveness and efficiency (Hamid, Muzamil, and Shah 2022). However, the company ignores strategic human resource management advocates for creating flexible work procedures. Anchored on O’Kane’s findings, the company has an inflexible order processing mechanism explaining why the car manufacturer’s request for a shorter lead time is unattainable. The ineffectiveness is caused by the difficulty moving the staff between finishing machines, press machines, and assembly machines.
Because of ineffectiveness, O’kane notes some people are under-worked while others are over-burdened. Additionally, the car’s engine parts are slowly produced, and their quality is affected, justifying the car manufacturers’ decision to raise the standards of the engine parts. The case study reveals the company’s emphasis on departmental projects to be the leading cause of inflexibility. Departmental projects immobilize workers’ rotation plans as employees lack the skills to move from one job to another.
Rather than complying with Abraham Maslow’s theory’s advice for awarding employees appropriate incentives, the company rewards the employees with fixed wages only. The company further fails to issue employees performance bonuses highly appraised by Abraham Maslow’s theory. Maslow’s theory recommends availing incentives and bonuses as they both positively impact employees’ retention rate since they feel acknowledged (Chan 2022). Negatively, the failure to reward employees with bonuses and incentives-based rewards explains the high employee turnover rate of 35 to 40 percent. The case study shows that individuals who voluntarily terminate their employment contracts with Brunel are frequently poached by competitors who offer superior terms and conditions.
Open system theory is a pioneer for large-scale production opportunities. It recommends companies enlarge their production capacity for future preparation for increased demand for goods and services (Castelle, Bradley, and Chesterman 2022). However, the theory advises managers to plan to expand their production capacity if the current data shows a steady increase in demand. Therefore, the company has an opportunity for large-scale production. In the future, it will produce car engine parts primarily since car manufacturers, as debited by the case study, need additional supplies to meet the rising demand for cars. The increased demand for cars is empirically confirmed by the car manufacturers’ request for a shorter lead time to produce cars’ engine parts. To effectively enlarge its production plants, the company opts to avail quality car engine parts and automate the production process for cost reduction. The reduced production cost will enable the company to meet the car manufacturers’ demand for low contract prices.
monopolistic competition model plays a significant role in projecting future-based stiff competition among companies operating in the same industry. The model reveals that companies in an industry with many firms offering similar but not identical products are threatened by stiff competition (Sebestyén and Szabó 2022). Therefore, it is empirical to predict the company is threatened by future stiff competition. Currently, the company encounters stiff competition from engine specialists from northeast England. As a result, the company’s current customers selling cars look forward to sourcing engine parts from companies located in the northeast of England as they can also avail of quality products. Also, to reduce transportation costs, the customers consider sourcing cars’ engine parts from the north-east of England due to convenience. If the company fails to reduce stiff competition imposed by northeast of England companies, it is threatened by insolvency.
Open system theory reveals that failing to embrace advancing technology exposes companies to obsolescence (Castelle, Bradley, and Chesterman 2022). Therefore, Brunel Company is threatened by obsolescence. Due to a shortage of capital, the company is now utilizing a small, outdated plant. In addition, its current machinery and technological systems are functional but obsolete, contributing to the delayed manufacture of engine parts for automobiles. The lack of initiative to obtain extra funds to finance sophisticated production equipment required to manufacture automobile engine components may endanger the company’s survival. It might become insolvent as car manufacturers need supplies with modern technology availing high-quality cars’ engine parts within a shorter lead time.
Projectable, the company, will encounter an inflation threat. Due to high inflation, the company’s capacity to avail cars’ engine parts at an affordable price will paralyze. Empirically, due to inflation, the company will instead increase its price for cars’ engine parts as the high cost of purchasing raw materials will be transferred to car manufacturers. The increased demand for cars and scarcity of raw materials for producing cars’ engine parts are foreseeing causes of future inflation. However, gradual steps for outsourcing raw materials from third parties are an effective weapon for hedging against future inflation.
Performance appraisal is a lucrative human resource management practice. It is defined as regularly evaluating or measuring employees; performance against a given standard (Lohman 2021). The company’s objectives, leadership straits, and ethical practices are performance standards used prevalently by managers to measure the worker’s performance. The commonly used performance appraisal methods are management by objectives, 360-feedback, and critical.
If Brunel uses performance appraisal practice, its future success will be attainable. Notably, it will fulfill its customers-the cars’ manufacturers- demand for quality products. The produced cars’ engine parts will be high quality as the employees’ performance will be regularly evaluated. As a result, the performance gaps will be unearthed, enabling the company to design training programs that equip its employees with appropriate skills. Therefore, the company should substitute its current traditional performance appraisal with a modern performance appraisal practice. The adopted modern performance appraisal practice should entail a formal procedure of measuring employees’ performance and state a given time framework used to appraise the employees’ productivity.
Training is also an instrumental human resource practice. It entails facilitating a platform where the employees are equipped with relevant skills (Souto and Rodriguez 2021). Employers often use two prevalent training methods to transfer skills to the employees. The two training methods are on-the-job and off-the-job. The on-the-job training method aims to sharpen employees’ skills by coaching the trainees while executing their allocated duties. On the other hand, the off-the-job training method equips the employees with verbal skills as the training venue is far from the workplace. On-the-job and off-the-job training methods are suitable for sharpening employees’ technical and non-technical skills.
Similarly, if Brunel leverages training practices, its future success will be attainable. The company will eventually be able to shorten the lead time of car engine parts. The lead time will decrease as the employees have the skills to speed up the production process. Additionally, using suitable training methods, the employees will have excellent skills advantaging the company’s plans of shifting the workers from one job to another. Lastly, the company will overcome the rising turnover rate enabling it to utilize the adequate workforce fully in shortening the lead time. Therefore, the company should replace its traditional training method with a modern one.
Lastly, performance-based compensation is the last practice suitable for Brunel’s future success. It dictates that monetary rewards awarded to employees and their output should relate positively (Garg, Jiang, and Lepak 2021). Therefore, an employee with the highest overall work output should be compensated lucratively. The standard rewards advocated by a performance-based compensation practice are performance bonuses, incentives, and performance-based wages. It is advocated by activists such as Abraham Maslow since it motivates employees to work harder.
Empirically, performance-based compensation is similarly a pioneer for Brunel’s future success. Specifically, its benefit of motivating employees to work harder will enable Brunel Company to meet its customers’ demands, shortening the lead time. Additionally, the company will immediately produce high-quality cars engines parts as quality-based incentives lure the employees to work precautionary by following the quality-based instructions. Therefore, the company should re-introduce the banned performance bonuses and proceed to institute incentives.
Firstly, I recommend the company establish clear goals. Clear goals give employees a sense of direction as they work towards attaining underlying goals (Van et al. 2018). Based on the car manufacturers” demand, the company should consider shortening lead time, producing quality products, and lowering production costs as long-term goals. Establishing the above goals will enable the company to design practical training, performance appraisal, and performance-based compensation practices. The management should leverage the SMART goals technique to establish clear goals effectively.
Secondly, I recommend the Brunel Company to involve the employees in the decision-making process regularly. Studies show that employees’ involvement enables companies to make rational decisions (Azim et al. 2019). Additionally, employee involvement gives workers a sense of belonging, motivating them to work harder to implement the formulated strategies. The company should create diversity, inclusion, and decision-making programs to engage the employees. The creative ideas proposed by the employees will nourish the company’s training, performance appraisal, and performance-based compensation.
Azim, M.T., Fan, L., Uddin, M.A., Jilani, M.M.A.K. and Begum, S., 2019. Linking transformational leadership with employees’ engagement in the creative process. Management Research Review. https://www.emerald.com/insight/content/doi/10.1108/MRR-08-2018-0286/full/html
Chan, T.M., 2022. Maslow’s Hierarchy of Needs. Education Theory Made Practical, Volume 4. https://books.macpfd.ca/etmp-vol4/chapter/chapter-5-maslow-hierarchy-of-needs/
Galani, A. and Galanakis, M., 2022. Organizational Psychology on the Rise—McGregor’s X and Y Theory: A Systematic Literature Review. Psychology, 13(5), pp.782-789. https://www.scirp.org/journal/paperinformation.aspx?paperid=117597
Garg, S., Jiang, K. and Lepak, D.P., 2021. HR practice salience: explaining variance in employee reactions to HR practices. The International Journal of Human Resource Management, 32(2), pp.512-542. https://www.tandfonline.com/doi/abs/10.1080/09585192.2020.1792533
Hamid, Z., Muzamil, M. and Shah, S.A., 2022. Strategic human resource management. Research Anthology on Human Resource Practices for the Modern Workforce (pp. 1-16). IGI Global. https://www.igi-global.com/chapter/strategic-human-resource-management/295326
Liggett, R., 2022. Democratic leadership in a study of school-based professional leadership culture: policy implications. International Journal of Leadership in Education, pp.1-16. https://www.tandfonline.com/doi/abs/10.1080/13603124.2021.2009036
Mach, M., Ferreira, A.I. and Abrantes, A.C., 2022. Transformational leadership and team performance in sports teams: A conditional indirect model. Applied Psychology, 71(2), pp.662-694. https://iaap-journals.onlinelibrary.wiley.com/doi/full/10.1111/apps.12342
Sebestyén, T. and Szabó, B., 2022. Market interaction structure and equilibrium price heterogeneity in monopolistic competition. NETNOMICS: Economic Research and Electronic Networking, pp.1-24. https://link.springer.com/article/10.1007/s11066-022-09155-5
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