Strategic human resource management in Unitel

Questions: Unitel is one of the largest telecommunications companies in the Asia Pacific region. Like most large telcos it was formerly government-owned, but was privatised in the early 1990s. Since privatisation, however, Unitel has faced increased competition from foreign and local competitors. Unitel remains profitable, but the telecommunications industry has seen considerable innovation in terms of both products and services in recent years, and senior management are concerned that the culture needs to be improved at Unitel if the telco is going to continue to grow its presence and maintain its profitability in a continually developing and changing market. Last year, Unitel senior management unveiled a new corporate strategy to guide Unitel into the next decade. Called Vision 2020, it is an ambitious programme that aims to place customers in a pivotal position and to seek excellence in products, customer service, product delivery and corporate image. Developed by an external management consulting firm, Vision 2020 aims to reposition Unitel as the best enterprise in the region by developing action teams and change teams whose role is to encourage possibility thinking and customer comes first values in the large industry incumbent. Vision 2020 has been enthusiastically embraced by many senior managers at Unitel. It is bringing field staff and high-level management together for the first time, remarked one plant coordinator. Problems are heard, solutions sought and, once found, their implementation is pursued. Unitel has a lot of internal problems, said another manager, and I see in Vision 2020 the possibility of salvation. I don't see anything wrong in trying to produce more trust in the company, commented a technical officer. The regular Vision 2020 de-briefings help to let all staff know what is going on and offer all of us a chance to have input into things. Some managers see Vision 2020 as creating a bottom-to-top communications system and inaugurating a new style of management founded on a renewed commitment to staff, getting employee involvement in problem-solving, improving customer service and creating a family-type environment. Yet there is also a considerable degree of scepticism about Vision 2020 among Unitel's 96 000 staff. I don't think Vision 2020 is accepted by my workmates, observed one customer service operator. They generally regard it as a joke. Indeed Vision 2020 has many critics at Unitel. As one senior technical officer commented, I hold a serious concern that some managers and staff have an almost fanatical and single-minded belief in the ability of Vision 2020 to save the company. They do not tolerate others who do not share their views, remarked another. I believe a climate is being generated where people who dissent are marked out and discriminated against. Vision 2020 has led to much standardisation at Unitel (from the timing of coffee breaks to the introduction of new forms of financial reporting) and improvements in internal communication (e.g. through the institution of a company e-newsletter). It has involved the development of goals or milestones that each of the restructured Unitel departments are expected to meet. These include enabling decisions to be made at the lowest possible level, the development of a customer needs tracking facility (called UNICATS) and the implementation of a decision-making process called the U-test. The U-test is essentially a diagram that asks Unitel management and employees to consider the following three questions when making any decision: (1) If I were a customer, would this satisfy me?, (2) If it was my business, would I do this? and (3) If it is done this way, will the team support it? But the benefits brought by the new strategy are often contested even by some managers. I find the Vision 2020 programme a complete waste of money, commented one regional manager. Most staff members seem to have accepted that Vision 2020 has created a rift between believers and non-believers at Unitel, and has exacerbated rather than solved many pre-existing problems. Some departments have even taken to sending Vision 2020 material straight to the small circular filing system (i.e. the rubbish bin). Where once there was a team spirit, complained a senior maintenance officer, now we are being told all our problems are self-inflicted and that it is our attitude that most requires changing. Other staff spoke of cheerleaders and puppets when describing advocates of Vision 2020 who worked in their departments. Management are deaf, claimed one sales officer. Our office has been faced with constant understaffing, excessive overtime and a shortage of materials and products. The rank and file, complained another, are expected to work smarter, but management seem only to care about buying the cheapest equipment and about belt-tightening on bread-and-butter items such as computers and photocopiers. The union is also suspicious that Vision 2020 is merely an attempt to undermine its standing among Unitel's employees. Senior management has made it clear that the union can get on the bus, but can't be a driver, as Unitel's CEO put it to the press. According to him, Vision 2020 is all about leadership about achieving cultural change. Senior Unitel management largely hails from engineering backgrounds, however, and according to one union delegate their understanding of social science is, to put it politely, not profound. A union research officer more categorically claimed, It is all about marketing to their employees Vision 2020 is largely a campaign to attack the union. Yet many Unitel managers regard Vision 2020 as a great success, a necessary response to the greater competition the large telco faces in an increasingly competitive, globalised world. Source: Contributed by Dr Bernard Mees, School of Management, RMIT University. Required: Explain the role of HRM in executing the business strategy at Unitel. Identify key issues relating to the introduction of the new corporate strategy by Unitel senior management. Propose some potential solutions to the problems relating to the introduction of the new corporate strategy at Unitel. Discuss how Unitel may benefit from using four (4) human resource management practices (covered throughout the BUSM3201 course) to improve organisational performance at Unitel. Answers: Executive Summary: The study focuses on Unitel considered as among the largest companies on telecommunications implementing a strategy named Vision 2020. Vision 2020 is a big initiative taken by Unitel in order to compete with local and foreign companies. As telecommunication industry is going through a sea change in technical field, Vision 2020 emphasizes on the innovation in regard to services and products. The senior management in the company considers the enhancement in cultural needs must need to be included in the strategy. This project aims to make the customers position in the pivotal area. Here as many people are supporting the strategy there many are against the change. This project is a report focusing on the role for Human Resource manager in executing vision 2020. It explains the key issues and challenges regarding the implementation o the strategy and recommendations on the key issues. The project ends with the potential solutions and how the company is going to get benefit from using human resource practices to improve the performance of the Organization as a whole. Introduction: Unitel is amongst one of the largest telecom companies in the Asia-Pacific region. It was formerly government owned but was privatised in the early 90`s. The privatisation of the company brought in many new opportunities but the market expanded and many new foreign companies entered the market with much competition. The company is doing good but in order to come on the top the company`s CEO has designed a corporate strategy and named it vision 2020. It is the guide to the next decade. The motivational programme aims to bring excellence in product line and increase the value to its customers. The main issue that the company is facing right now is to implement this new corporate strategy; many employees who do not believe in the feasibility of the plan. The organization is divided into two groups the believers and the non-believers. The company has to apply a new strategic human resource management plan which would turn the non-believers into the believers. A well-planned strategy that would help the employees acclimatizes into the new corporate strategy. The employees will have to believe in the vision of the company. Role of HRM in implementing the strategy at Unitel: According to contingency theories there is no single process of leading. Leadership styles should differ according to situations. This means te degree of performance differs according to situations (Smith and Lewis, 2011). Similarly the role of an HR differs according to the situation, like in Unitel; there is a sheer requirement of setting up a strategy for employees to accept Vision 2020. Implementation of strategy is concerned with supporting the organization structure, processes and systems with the new corporate strategy. A wholesome corporate strategy involves man, processes and systems. The coordination of these three is very important or else a well-planned strategy will also fail. When an organization takes new leap, the work force of the organization has many delusional thoughts regarding the success of the plan (Armstrong and Armstrong, 2011). These plans will never succeed if the human resource of the organization does not believe in the plan. Here starts the roles of human resource management, the team of human resource has to first believe in the concept of new strategy and then prepare a well-planned strategy to deal with the human resource (Dessler, 2013). The human resource management has to make the employees believe in the strategy. There are various steps that have to be followed by the human resource department to achieve the goals. Various issues w ould come in front, which have to be tackled meticulously. The steps that are included in converse the strategy to the employees include: 1. Communication: Communication is an essential part of a strategy. If the strategy is not properly communicated to, the employees then the there are no chances of its success (Dessler, 2013). It`s the employees who are actually going to carry out the plans and procedures. 2. Top-bottom approach: The employees will feel included when the top management would them self communicate with the employees on a new strategic plan. If a huge corporate strategy is made and is directly ordered to be implemented, then the employees will never understand the motive of the strategy. At Unitel the human resource management needs to act as a bridge between the employees and the management (Hillier, Grinblatt and Titman, 2012). 3. New motivational plans: The human resource department can go for some motivational training that would motivate the employees in understanding the vision of the company. 4. Employee satisfaction measure: The Company after the trainings should look for feedbacks from the employees regarding their view on the new strategies (Krug, 2009). 5. Persuading cross-system cooperation: When an organization is realising transformations, the coordination between departments tends to slow down. In this, regard the human resource management has to take steps and divide the work groups in such a way that they are bound to coordinate with each other. The employees should be made to rotate their jobs from one department to another so that they understand the new working procedures (Mondy and Mondy, 2012). The above diagram explains the strategic contribution of an HR (Dowling, Festing and Engle, 2013): The strategic contribution of an HR are, decision making, fast change, market driven connectivity and cultural management. The HR also requires having business knowledge and the Hr has to enhance and update his knowledge according to time. The personal credibility includes effective relationship, personal results ad achieving remarkable results which happens after the HR delivery process. The HR delivery process includes Organizational structure, Organizational development, performance management and Staffing. Key issues in implementing new business strategy: The company would face various issues initially in implementing the new business strategy. These issues have to be resolved for the successful implantation of the strategy. The key issues are: 1. Lack of coordination between new processes and people: The employees who were habituated working with old processes and systems will take time in understanding the new processes and machines. 2. Wastage of time in implementation of the strategy: The new strategy is undoubtedly a huge decision and has many things to be taken care off. From people, processes and machines everything in the organization will have to be changed. This will need a lot of time to implement these strategies. The company will lose a lot of potential time of generating more revenues. The wastage of time has to be compensated (Pollack, 2011). 3. Additional training programmes for the employees for orientation: The new processes that will be installed in the organization will have new working procedures. The employees of the organization will have to learn the operations and which will need a lot of intense training. This training will have to be provided partly by the human resource department and partly by the technical department. The cost of these trainings will be accounted as extra cost to the company. 4. Issue of customer satisfaction: The customers satisfaction highly depends on the quality of the product and if the quality of the products is not good then the issue of good customer service will arise. 5. Pre existing challenges the organization is facing in the global market: The telecom industry is very huge and many organizations that are already in the market. Competing with these firms is very tough. Some of them are the global market leaders. They are already very popular in the market. 6. Cost of new technical resources: New strategies would begin with new resources; these technical resources would do extra costs to the company. 7. Acceptance of the new strategy by the employees: The major issue the company, which it will face internally, will be of acceptance of the new business strategy by the employees. 8. Shortage of material and understaffing, overtime: It is seen that after implementing the new strategy the company is suffering major issues of understaffing, and overtime. This clearly means less number of employees in the organization and less job satisfaction among the employees (Torrington, 2011). 9. New process would require new skilled labour force at higher salaries: The recruitment of a new skilled labour force is another issue. The value of a skilled labour is always more. The company has to pay more salaries and time to recruit skilled labours. The criteria of selection for the new workforce will have to be high. Solutions to the problems on implementing the strategy: Coordinating of process and people: The people of the organization need to be well acquainted with the process that is going to be implemented. The company got privatized in the early 90s, which changed the total climate of Unitel, but Vision 2020 seems to bring another change in the work climate (Irani and Kamal, 2014). There is ample possibility for the employees to go against the strategies of vision 2020. This requires a brief orientation for the people to have a thorough knowledge that would convince the employees that the strategy is more advantageous. Time management: The implementation of Vision 2020 is considered as a long process that would require a longer time to be executed. This is because the workers need to be convinced first and apart from that the financial budget requires to be made. But in the year 2020 the cost of raw materials, labor force and the technologies would be higher. Thus a proper market speculation needs to be done in order to have an idea of future prices. Another solution for time management is that improving the economic condition of the company by increase the scale of production with the help of the existing force. Resolving Training programs and its issues: Training involves cost of training. Training and development schemes are necessary for a company to adapt technological advancement. Similarly vision 2020 also requires skilled labor for specific technology. But training involves cost and so does hiring. Hiring is the alternative for training. Training people who are sufficiently skilled and quick learners would reduce the cost. In fact if few efficient employees are engaged in vocational training and then if they are promoted to lead a group of employees so that not only they would guide the employees but they would also train the employees. This process will be effective because the leader or representative will be able to communicate and relate with other employees because other employees would easily rely on them. Customer satisfaction: If the employees are not satisfies the product quality and the quality of service will reduce (Chand, 2010). Through the discussion of Vision 2020 it was found that the workers are not ready to accept the proposed strategies. Though it is expected that with the help of new strategy the customers will be able to have more facilities from their products, yet the customers might not agree to access the new change. In order to solve this problem the company must provide proper information through service, and for proper service the required employees also needs to know the information about the product. A simple demonstration by the production department about the increased facility would educate the service providers. Cost of production and shortage of materials According to economics the cost of production includes two basic resources, they are capital and labor. As the capital is always considered fixed, the labor becomes the variable factor in production. The Vision 2020 is a strategy for technological transformation, but the extent to which the labors are included is not clearly mentioned. Thus the labor and labor unions seems to have issue on the implementation. A fear of retrenchment and termination remains, but vision 2020 promises that it would also highlight the benefit of the employees. There had been several complaints that the work hours, and over were more compared to their work. With a collaborative effort by employees and improved machinery the production level will increase and the work time would reduce. This can be done by motivating the present employees for participation and equal treatment for the employees. The shortage of raw materials is a general issue that depends on the availability of resources; the resources are land labor capital and organization. Capital can be adjusted with the profitability of the company. Changing perspective and understaffing With changing perspective Organizations often faces a challenge to cope up with it. Change is hard to be adopted and get accustomed with as already since the early 90s the company is facing a big change as it turned from government owned to private owned. The employees newly got accustomed with the change and now they have to get accustomed with the transformation of technologies. In this stage the employees need motivation and appraisal for psychological effectiveness. Understaffing problems like Stressful conditions, overwork, reaching goals etc creates resentment among the employees (Boonstra-Hrwein, Punzengruber and Grtner, 2011). This can be overcome by providing incentive and other forms of appraisal. How Unitel could benefit from using four human resource management practices. The HRM practices are a system which motivates, develops, retains and attracts employees for survival of the organization and effective implementation of their strategies. The HRM practices are also known as a set of internally consistent practices and policies which are designed to implement plans for the organizations sustenance. The main four HRM practices are Performance Appraisal: Performance appraisal is tools that help to evaluate, assess and review the individual performance of an employee. It is used to explore the possibility job growth of an employee. In Unitel Vision 2020, many employees see that it is merely an attempt to undermine its standing among employees. Performance appraisal helps the employees to think differently in accordance with that idea (Chang, Oh and Messersmith, 2013). Performance appraisal highlights the area of weakness to improve. It is also a form of motivation to the employees. Training: For technological advancement the employees also need to be upgraded for their tasks. Like unitel proposing the making of Biofuels from microalgae, special skilled people are required to operate this process. It is not that the existing employees are not that potential, but in order to engage them the employees must have a know-how of the process. Training helps to fulfil the gap between what is required and what can be done (a review on the benfits of training and development for individuals, teams, firms, and society, 2014). Reward system: Reward system is more like a motivation for the employees so that they could devote their precious time and labor with self-consent (Solinas, Goldberg and Piomelli, 2008). The process would help in changing the mindset of the existing employees who are going dead against Vision 2020 strategy. Recruitment. Recruitment process is mostly considered as one of the alternative for training. Training requires time and money, whereas hiring would require money but within a specific time the company would have skilled employees who can easily get accustomed with the new strategy. A strategic implementation reference: According to the annual report presented by the CEO of a reputed E-commerce company the remarkable feature was that of strategic human resource management focusing of employee empowerment. The proposal was accepted by the company and it agreed to pay 95% of tuition fees for the employees who would take up the course and the also agreed to a program named pay to quit where the company would pay up to US$ 5000 for employees who would want to quit (Bezos, 2014). This sort of initiative was taken for the employees because they felt that people with low enthusiasm for their job results in low productivity. Good companies are not for everyone, if the employees are not satisfied then they will be paid to quit their job. The strategy became very effective. In Unitel certain programs can be included but keeping in mind the budget and how the company and the employees both would get benefit from that. Conclusion: The company will face many issues while implementing a new corporate strategy but these strategies will be very fruitful in the near future. The company has to resolve much issue before implementing these strategies in various directions. The human resource department has a huge role to play in strategically implement the new business strategy of vision 2020. The managers of the company have enthusiastically clinched the new strategy but there are employees who do not believe in the feasibility of the plan. The organization has divided into believers and non-believers, the huge task of the human resource department is to convert the non-believers into the believers this can be done by giving them proper orientation programmes and make them understand the actual vision and mission of the organization for the next decade. 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