HUMAN RESOURCE MANAGEMENT, MB- 203

Course Instructor: Harleen Mahajan

Course Book: Gary Dessler Human Resource Management, Ninth, K Aswathappa Class Room Policies

The following are the policies regarding class behavior required in Human Resource Lect.

1. Attendance will not be marked if the student is late by more than 5 min in the class.2. 75 % of the attendance is required to appear in the final exams.3. Late assignments will not be accepted. 4. All the topics of presentation are already in the mail so 100 % attendance is required on

presentation day.5. If you will be absent on the day of test you will have to pre pone it.

Course Requirements and Grading

1. Readings and case studies : (3 marks) These will be mentioned with each lecture in the course break up and all the students are required to read them before coming to the class and at the end of semester each student will submit 3 page written format on the analysis of all the readings and 3 page written format on the analysis of all the case studies done in the class.

2. Assignments: (7 marks). The assignments will be mentioned in the course breakup and students are required to submit that assignment after three days. First and second assignment would be a general assignment which would be given individually to each student and it will be of 2.5 marks each. Third assignment would be an e-mail assignment which would be given one day before and will be corrected and evaluated at the same time of the submission and it will be of 2 marks.

3. Hourly Tests: (10 marks). First hourly test would be open book class test which would be of 5 marks. other test would be general would be of 5 marks.

4. Class presentations: (5 marks)

5. Mid-semester Examinations (15 marks)

Assignments: 3 Cases :4

Total Lectures: 44 Tests: 2 Presentation:1Activities:3

Lecture Number

Topics Date Assign Test

1 Ice breaking session in which the students will be told the success stories of HR managers and they will be asked to pick any of the company, in which they will study the role of HR manager during the whole semester.They will be asked to create login in the site citehr.com to indulge themselves in HR discussions.

Warm up session: Hidden Battleground2 Introduction: Meaning

HR is a series of integrated decisions that form the employment relationship, their quality contributes to the ability of the organizations and the employees to achieve their objective. Scope of HRMNature of HRM, Employee hiring, Remuneration, motivation, maintenance, and industrial relations.

3 ObjectivesSocietal, Organizational, Functional, PersonalFunctionsLegal Compliance, Union management relations, HR planning, selection, training, placement , assessment, compensation and appraisalPolicies & roles Are the plans of action, Organisations need to have HR policies as it ensures the consistency.

4 Importance of Human Resource ManagementEvolution of HRM and its progressBest employers by Business Today will be discussed.

5 HRM & HRD a comparative analysis

6 Organizing the Human Resource Management department in the organization.Various Forms of HR structures like Line, Line and Staff

7 Human Resource Management practices in India. 1

Discussion of Assignment No. I

7 Human Resource Planning: DefinitionHRP is the process of forecasting a firm’s future demand and supply of the right person at the right place.objectives Future personnel needs, Part of strategic planning, are creating talented personnel, International strategies.

8 HRP process

9 Job analysis, description, specification & job evaluationJob Analysis is the process of studying and collecting information relating to the operations and responsibilities of a specific job.

10 Recruitment, selectionRecruitment involves attracting and obtaining as many applications as possible from eligible job seekers.Sources Internal and external SourcesRecruitment process Recruitment process of British gas will be discussed in detail, attached herewithSelection Is the process of differentiating between applicants in order to identify and hire those with a greater likelihood of success in job.Selection Process Prelim interview, Psychological test, Employee interview, Reference check, selection decision, medical exam, job offer, employment contract.

11 Placement and induction process.Induction is the systematic and planned introduction of employees to their jobs, their co workers and the organization.Formal/ Informal, Individual/collective, serial/disjunctive, Investiture/Divestiture.

12 Class test 1-11 1

13 Human Resource Development: Concept.Is improving current or future employee performance by increasing employees ability to perform.

14 Employee training

Is the process of teaching new employees the basic skills they need to perform their jobs.MethodsOn the job training, Apprenticeship ,Simulated, Electronic,

15 Employee developmentCase study 2:

16 Career Planning Making career choices and decisions – the traditional focus of careers interventions. The changed nature of work means that individuals may now have to revisit this process more frequently now and in the future, more than in the past.

17 Career development The study of career development looks at:

how individuals manage their careers within and between organizations

and how organizations structure the career progress of their members, it can also be tied into succession planning within some organizations.

18 Discussion on Presentation

19 Performance management: Is an objective assessment of an individual’s performance against well-defined benchmarks.ProcessObjectives of performance appraisal, establish job expectations, design a programme, and appraise performance review.

20 Methods of Performance appraisalRating scales, Checklist, Vestibule, Simulations, Field Enquiry, Forced Distribution, Critical incident, Behaviorally anchored rating scales Essay method, Ranking method, Paired comparison.

21 Potential appraisalReading 4: Avoiding 360- Degree Paperwork, page 260, Human Resource Management, Gary Dessler, Ninth edition.

22 Job Compensation:

23 Wage administrationIs the administration of the hourly rates of pay, irrespective of the number of hours put in by an

employee.Components of good package-Monetary and non-monetary benefits.

24 Salary administration Factors affecting employee remuneration like Labour markets, Going rate, Productivity, Cost of living, Labour Unions, Labour Laws, Society.

25 Incentive plansGroup and Individual Incentive Plans like Taylor’s plan, Rowan’s, Beaudex, Gantt, Merrick, Priestman .

26 Fringe benefitsFringes embrace a broad range of benefits and services that employees receive as part of their total compensation package pay or direct compensation.Principles of Fringes

27 PromotionsMeans improvement in pay, prestige, position, and responsibilities of an employee within an organization.Types of promotions: Horizontal, Vertical and DryDemotionsMeans decrease in pay, prestige, position, and responsibilities of an employee within an organization.

28 TransfersInvolves a change in job along with it a change in place without change in pay, position or responsibilities.Types: Production, Replacement Versatility, shift Remedial.SeparationLayoffs, resignations and dismissals separate employees from the employer.

29 Absenteeism & turnover. Refers to the failure on the part of employees to report to work though they are scheduled to work.Causes of AbsenteeismCauses of Absenteeism in IndiaTurnoverRefers to employee leaving the organization and the need to be replaced.

Causes of Turnover30 Test 2; Lectures 13-29 2

31 Quality of work life (QWL): Meaning,- is ensured when the important personal needs of employees are being fulfilled through their experiences in the organization.Origin of QWL Factors contributing towards QWL.

32 Development and various approaches to QWL

33 Techniques for improving QWL. Reading 7: Family Friendly Benefits, pg 386, Human Resource Management, Gary Dessler, Ninth edition. Benefits and Employee Leasing, pg 390.

34 Quality circles: concept – is the group of persons within the same work area in an organization who meet frequently to discuss and analyse quality related problems.Structure, Role of management quality circles in India

35 Job satisfaction Job satisfaction has been defined as a pleasurable emotional state resulting from the appraisal of one’s job an affective reaction to one’s job and an attitude towards one’s job.Employee Morale.Affect TheoryDispositional TheoryTwo-Factor Theory

36 Health, Safety & Employee welfare. Refers to all those factors of employers, trade unions, voluntary organizations and govt. agencies which help employee feel better .Employee welfare in India.

37 Counseling for effective Human Resource Development.

38 Human Relations: definition, objectives & approaches to human relations, Discussion of e-mail assignment 3

2

39 Employee grievances Refers to any conflict between the employees and employerCauses of disputeSettlement of Grievances- Collective Bargaining

- Code of Discipline- Grievance procedure- Conciliation

40 Participation & empowerment,Employee participation is the process whereby employees are involved in decision making processes, rather than simply acting on orders. Employee participation is part of a process of empowerment in the workplace.Principles of empowermentDemonstrate You Value PeopleShare Goals and DirectionTrust PeopleDelegate Authority and Impact Opportunities, Not Just More Work

41 Introduction to collective bargainingIs a process by which representatives of employees meet the representatives of management in order to determine wages, salaries and other issues.Process of collective bargaining

42 HR Audit.Is a tool which helps in assessing the effectiveness of HR functions in the organization.Approaches to HR Audit - Outside Authority Approach - Statistical Approach - Compliance Approach - MBO

43 Introduction to Business EthicsRefers to good and bad, right and wrong, just and unjust actions of the business people.SourcesReligionCultureLegal System

44 Class Test: 3, Whole syllabus 3

WARM UP SESSION

Case 1) The hidden battleground: the case

Acquisition talks are at an advanced stage between two software giants when the HRD head of the acquiring company demands a place at the negotiating table. What impact will her inclusion in the team have on the deal? Ashish Malhotra, CEO of Gentech Solutions Ltd and Narain Bhattacharya, CEO of Hindustan

Computer Corporation (HCC) wound up their hour-long quasi-informal discussion on the acquisition their companies were contemplating with a warm handshake. Their faces beamed with satisfaction as they walked out of the elegant interiors of The Oberoi's exclusive members-only executive club overlooking the Arabian Sea.

"See you tomorrow," said Ashish. "Same place, 11.00 a.m.?" Narain seemed unsure. "Excellent," answered Ashish, suppressing his impatience as he entered his BMW. "How am I ever going to pull them away from their public sector mindset?" wondered Ashish casting a last glance at Narain's Maruti heading the other direction. He quickly glanced at his watch. It was already 3.45 pm. He had just fifteen minutes before a scheduled appointment with his colleagues, Sushil Acharya, Vice President Finance, and Jacob Mathew, Vice President Strategic Initiatives.

At Gentech Headquarters

Gentech, one of India's largest software and Services Company is close to signing a deal to acquire HCC, a leading government owned domestic provider of end-to-end IT solutions and services. Gentech's primary motive for this acquisition is to consolidate its market leadership in India. And the government's divestment policy is helping Gentech realize this objective. As Ashish briskly walked into one of Gentech's conference rooms, he was welcomed by two senior Gentechies, as all employees at Gentech are internally known.

"Did the talks go well?" Jacob asked excitedly. "Yes, they did," Ashish responded. "Our team will meet theirs tomorrow to finalize the deal." "Good, perhaps we should now discuss ways to tighten our bargaining position," urged Sushil. "Before that why don't we quickly update ourselves on the core strategic and financial benefits coming out of this deal?" Ashish looked at the duo for a response. "Fine, that would serve as a warm up too," replied Jacob as he poured freshly brewed Darjeeling tea into their cups.Jacob began with the strategic benefits. "HCC has expertise in facilities management and also in handling large turnkey project execution. They have a wide range of service offerings and complementary domain expertise. Gentech can benefit from their nationwide sales and support network and also from their large domestic client base. Moreover, their reputation with the government will help increase our market share further. The key attraction is their strong domestic market focus and that would very much complement our international market expertise."

Ashish nodded in agreement as he turned to Sushil. "Exactly," Sushil took over. "Nearly 80% of their total revenue came from their domestic operations during the last fiscal and this represents 4.6% of the total market share. The government and public sector market together accounted for nearly 51% of the total domestic IT market last year. Maintenance and support is an Rs 4.5 billion domestic market and HCC is the unquestionable leader there with an awesome 70% market share."

"And that surely will help us strengthen our position in the domestic market. It's a pity that we hardly have any presence in the Rs 95 billion domestic market for IT services that is growing by 45%. Though we grew faster than the global market, the global market grows at just under 15%. Besides, the US slowdown is reducing it further," added Ashish. "We should strengthen our bargaining position tomorrow by enlightening them on how they could benefit by joining our family. If we try, we should be able to sail through the deal with a price even lower than the currently quoted price," Sushil reiterated his point.

Ashish turned to answer the knock on their door. It was Aditi Saxena, Gentech's Vice President HR. "Yes Aditi, what's up?" asked Ashish. "Can I join you for a short while?" she sounded

disturbed. "Sure, any problems?" Ashish was concerned. Aditi is known to have her finger on the pulse of the company. "You are discussing HCC, right?" she asked. "Yes, relax. Would you like some tea?" Jacob took up his familiar role. "Yes please. Do you have any role for HR in tomorrow's discussion?" she asked. "Don't worry. We'll put you in charge of integration. At least wait till we clinch the deal," Sushil quipped.

"I'm serious. We'll have to discuss this. The correct spelling of acquisition begins with HR," Aditi retorted. Ashish jumped in to save the situation, "Aditi, what's actually bothering you?" "Are you going to discuss culture issues tomorrow?" she looked at Sushil. "Why so early?" he asked with surprise. "I knew that culture simply wouldn't be on your map. Not only incompatible cultures but also issues like loss of key talent and clash of management styles will pop up one after the other as soon as the deal goes through. Don't underestimate these problems. It's better to talk about them early on," Aditi wanted to get her point across.

"I don't want to sound like a typical HR person who lacks business breadth. I'm fully aware of the strategic and financial benefits HCC would bring to Gentech, but I would like you to ponder over people issues too. Lack of attention to people issues could ruin the perfect fit between the companies. Unlike in a manufacturing company, people are the assets of Gentech and HCC. The talk about acquisition is already having its impact on employee morale. Valuable people, especially from HCC are planning to migrate ahead of the deal to rival companies. When we acquire HCC we buy their talent and if HCC loses its people it loses its charm too. At our end, Gentechies are worried about losing their positions to people from HCC." Aditi stopped to sip her tea but continued before anyone could react.

"As all of us know, they have a very different PSU culture. I still have no clue on how we could integrate them into our fold. Our global oriented culture demands greater accountability. We will have to induce our performance driven culture into them. Moreover, the 3,100 employees at HCC take pride in the fact that they developed the Rs 6.5 billion company on their own. This would surely lead to inertia against any incoming new culture. We have to talk about what people roles would be and what the reporting structure would be, early on. We have to talk about issues of compensation, benefit shifts and so on, and communicate the decisions to people on both sides. This would go a long way in bringing down anxiety levels and aid in the smooth transition towards the post acquisition integration process. What do you think?" Aditi tried to gauge their reactions.

"We'll try to get your views across tomorrow," Sushil broke the short silence. "No, I want a seat at the table tomorrow. I believe these are important issues which have to be dealt with tactfully. Sushil, you wouldn't want me to discuss financials and bargain on the price tomorrow, would you?" Aditi made her stand clear. The trio anxiously looked at Ashish for a verdict. "Aditi, we'll see you tomorrow at 11.00 am," Ashish put an end to the three hour long session. "Does Mr Bhattacharya know who would be in from our side?" asked Jacob. "Not anymore," smiled Ashish as he switched off his Sony Vio.

… And over at HCC headquarters

Amidst celebrations on a new project completion, CEO Narain Bhattacharya, Rajiv Aggarwal, Vice President Strategic Initiatives, and Akil Trivedi, Vice President Finance, managed to pull in sometime together to discuss the merger deal. "Are things looking up?" enquired Akil. "Almost. We are meeting them tomorrow to finalize a few major issues," answered Narain. "We shouldn't budge on the price tomorrow," stressed Akil. "Let's see," was Narain's answer. "Do we really benefit from this deal? I somehow feel that they are better placed in the deal," remarked Akil. "I

wouldn't say we are in a fantastic position," continued Rajiv sipping his filter coffee, "but we definitely stand to gain. We could benefit from the international market expertise of Gentech. We would be able to leverage our capabilities in the international market. Gentech posted 31% growth over the last five years. More importantly, we'll be part of a highly profitable giant," Rajiv commented. Narain nodded approvingly.

"Where does our independence stand? Not only that, our people are already worried about the pink slips," that was Pramod Jain, Vice President HR, who overheard Rajiv's comments. "Don't worry about pink slips too much. Our 3,100 employees will easily be assimilated into Gentech's 20,000," replied Rajiv. "Assimilated? In what positions? People are worried about this and many of our key talent are already leaving us. They've lost the sense of belonging. Gentech or Sipron, it makes no difference to them," muttered Pramod.

"I believe we would blend with the Gentechies very well," Rajiv held on to his point. "Forget about blending, we would be lost," Pramod insisted. "There won't be any more celebrations like this. They would force their tough culture onto us. Their average revenue per employee is higher by a good 20% than ours though our billing rate is high at $73 per hour. They spend less than 20% of revenues on salaries and wages, much below the industry average and certainly less than us. Though they talk of giving us our independence, independence would remain in the periphery."

News about their demands is spreading like wildfire. They seem to want top line to grow at 30-35%. People already feel they have begun bossing over us and talking of bringing about improvements in margins, enhancing return on capital employed and many others. Our existing senior management would supposedly continue, but there will be two managers for each post especially at the top and senior levels, and they are bound to induct key personnel from their side. We would just be puppets in their demanding hands," Pramod continued.

"Given that we have no choice in the merger, we have several pressing financial and strategic issues to sort out before tomorrow's meeting," said Akil, trying to side-step Pramod. "We are being bought, gentlemen! HR becomes more important for us. We really have to get our views across and try to get a better deal for our people," Pramod made his final remark. "I can't think of any better buyer than Gentech. People issues will surely be settled once the deal is signed. Stay assured," Narain tried to comfort Pramod and put an end to the argument. Pramod was clearly unhappy. He felt the pressing need to be present at the meeting the next day, but had no other option but to stay back. Perhaps he was not forceful enough.

The talks begin

The day began with Ashish and Aditi signing in early. By 11.00 am Sushil and Jacob joined them. It was 11.15 am and the Gentechies were awaiting the arrival of Narain and others from HCC. "Sorry, we were caught in a traffic jam," Narain excused his side for being late. "I'm Sushil Acharya…I'm Akil Trivedi." They shook hands one by one. When it came to Aditi, Narain enquired, "Aren’t you a new addition? I'm Narain Bhattacharya and it's a pleasure to meet you". "Well, Mr Bhattacharya," continued Ashish "We had a new development yesterday and couldn't find time to inform you. Aditi is our Vice President HR. We decided to bring up some people issues as well," smiled Ashish as he turned to Aditi who in turn nodded approvingly. "Isn't it too early for that?" Narain was taken aback. "Nothing is too early, Mr Bhattacharya," replied Ashish. Narain seemed surprised as he whispered something to Rajiv.

Should Narain have included Pramod in the HCC team sitting at the negotiating table? Was Ashish wise to have brought Aditi along for the talks? What impact will the decision to include a HR head have on the acquisition talks?

Case 2:

Employer Branding at McDonald's: Redefining McJobs

This case is about the employer branding strategies adopted by McDonald's Corporation, one of the largest fast food chains in the world. Since the 1980s, entry-level jobs at McDonald's had come to be associated with low-paying dead end jobs.

The term 'McJobs' had become synonymous with low-prestige, low-benefit, no-future jobs in the service or retail sector particularly at fast food restaurants and retail stores. Though the term was coined to describe jobs at McDonald's, it was later used to refer to any low-status job where little training was required and workers' activities were strictly regulated

Because of its common usage, the term appeared in the online version of the Oxford English Dictionary (OED) in March 2001 and the Merriam-Webster Collegiate Dictionary (Merriam-Webster Dictionary) in 2003.

The case discusses how McDonald's systemically tried to redefine the term 'McJobs' and improve its employer brand since the early 2000s. According to McDonald's, this negative interpretation of McJobs was not only inaccurate but also demeaning to the thousands of people working in the service sector. As employer branding was a critical management tool for companies to attract the right talent, McDonald's decided to try and revise the image associated with McJobs. This it did by taking various initiatives that also included advertising campaigns aimed at showcasing the benefits of working at McDonald's and bridging the divide between people's perceptions of the McJob and the real employment experience of people actually working for the fast-food chain.

Experts felt that these were some of the best examples of a company successfully planning and implementing an employee branding strategy. However, the case also highlights the challenges faced by McDonald's in attracting new talent as derogatory comments continued to be made about McJobs and this could discourage prospective employees from taking up such jobs.

Issues:

» Understand the importance of employer branding and its relationship with the ability of a company to attract talent.

» Understand the issues and challenges in planning and implementing an employer branding initiative.

» Understand the strategic role of Human Resource Department.

» Evaluate the initiatives taken by McDonald's to bridge the gap between people's perceptions of McJobs and the real employment experiences of people actually working at its restaurants.

» Explore strategies that McDonald's could adopt in the future to enhance its employer brand.

What it did brilliantly was make an assessment of the large gap between external perceptions and the internal reality of work at McDonald's. They then worked hard to redefine the meaning of 'McJob' by putting forward irrefutable evidence about the quality of jobs they offer."1

- Andy Dolby, managing director of Barkers Resourcing2, in November 2008.

"But bridging the divide between people's perceptions of the McJob and the positive employment experience of people actually working for the brand is not going to be easy. While our employees tell me that they find the comments made about 'people like them' upsetting and demeaning, if we argue our case too stridently, we risk the old Shakespearian dilemma of seeming to be "protesting too much". We intend, instead, to acknowledge the McJob and all it has come to represent, and respectfully offer objective evidence that might challenge people's preconceptions." 3

- David Fairhurst, senior vice president people (UK and Northern Europe), McDonald's Corporation, in March 2006.

Introduction

In early 2009, when an outlet of the world's leading fast food chain, McDonald's Corporation (McDonald's), in western Ireland put up a "Now Hiring" banner on its site, it received more than 500 applications. These included applications from bankers, architects, and accountants.4 Analysts viewed this as a sign of the troubled times with a recessionary trend setting in. But experts also pointed out that it was an indication that the company had been largely successful in bridging the gap between external perceptions of work at McDonald's and the internal reality through effective employer branding initiatives.

Background Note

Headquartered in Oak Brook, Illinois, McDonald's is one of the largest fast food restaurant chains in the world with about 31,967 restaurants serving more than 58 million people in 118 countries as of 2008. The group's principal activity includes operating and franchising restaurant businesses under the McDonald's brand...Origin of the Term 'McJobs'

In 1977, McDonald's launched an advertising campaign using its icon Ronald McDonald to create a 'McLanguage' specifically associated with McDonald's. 'McLanguage' involved formulation of words by combining the 'Mc' prefix with a variety of nouns and adjectives...

The 'McJob' Issue

McDonald's complained about the definition of the term 'McJobs' after it was recorded in the OED. The company claimed that the meaning of the term as described in the dictionaries was offensive to McDonald's employees all over the world and that it brought negative publicity to the brand...Redefining McJobs

Since the 1980s, McJobs had become synonymous with low-paying jobs with no growth opportunities. Analysts felt that such jobs imparted a few skills to workers that would be more or less of no use to them in the future...

"My First Job" Campaign

In September 2005, McDonald's launched a television campaign to promote the advantages of a McJob and to enhance its image as an employer brand. The campaign, titled "My First Job" was designed to position McDonald's as a preferred place of employment and McJobs as stepping stones to a successful career...

Mcdonald's People Project

During this time, McDonald's Ireland commissioned Cawley Nea/TBWA launched the 'People Project' in Ireland to change the negative perception about McDonald's as an employer..."Not Bad for a McJob" Campaign

In April 2006, in order to shed its low-paid 'McJob' label, McDonald's UK started a nationwide poster campaign highlighting the positive business practices of the company and the advantages of working at McDonald's (Refer to Exhibit V for employment benefits offered to McDonald's employees in the UK)...

Change the Definition" Petition Campaign

In March 2007, McDonald's launched a petition campaign to get the dictionary definition of a McJob changed. The petition aimed at garnering public opinion about the change in definition was circulated across McDonald's restaurants in 40 British cities for signatures from supporters...'My McJob' Campaign

In April 2008, McDonald's UK redesigned its staff uniforms to give its employees a modern and professional look and to narrow the gap between the perceptions and reality of work at McDonald's...

Campaigns in Other Countries

With McDonald's launching campaigns in the UK to address the image of the McJob, its US counterpart too launched advertising campaigns to depict the advantages of working at McJobs...Results

The sustained campaign of McDonald's forced OED to analyze the situation. In 2007, in order to prove that the interpretation of the term McJob was correct in the dictionary, OED invited the public to submit opinions on the definition of a McJob...

The Other View

But some observers felt that McDonald's was using the McJobs issue to promote its brand. According to a marketing expert, "McDonald's have been clever in a tactical sense. They have taken the opportunity to win public sympathy and support, and show they are good employers at the same time."...

Looking Ahead

According to analysts, the biggest challenge for McDonald's would be to attract new talent as derogatory comments that were still being made about McJobs would discourage prospective employees from working in such jobs...

After Reading this case , suggest some HR practices…..YOU THINK… that Mc Donald’s can follow

Case 3:

Philips India - Labor Problems at Salt Lake

Selling Blues

The 16th day of March 1999 brought with it a shock for the management of Philips India

Limited (PIL). A judgement of the Kolkata1 High Court restrained the company from giving

effect to the resolution it had passed in the extraordinary general meeting (EGM) held in

December 1998. The resolution was to seek the shareholders' permission to sell the color

television (CTV) factory to Kitchen Appliances Limited, a subsidiary of Videocon. The

judgement came after a long drawn, bitter battle between the company and its two unions

Philips Employees Union (PEU) and the Pieco Workers' Union (PWU) over the factory's sale.

PEU president Kiron Mehta said, "The company's top management should now see reason.

Ours is a good factory and the sale price agreed upon should be reasonable. Further how

come some other company is willing to take over and hopes to run the company profitably

when our own management has thrown its hands up after investing Rs.70 crores on the

plant."

Philips sources on the other hand refused to accept defeat. The company immediately

revealed its plans to take further legal action and complete the sale at any cost

Souring Ties

PIL's operations dates back to 1930, when Philips Electricals Co. (India) Ltd., a subsidiary of

Holland based Philips NV was established. The company's name was changed to Philips

India Pvt. Ltd. in September 1956 and it was converted into a public limited company in

October 1957. After being initially involved only in trading, PIL set up manufacturing

facilities in several product lines. PIL commenced lamp manufacturing in 1938 in Kolkata

and followed it up by establishing a radio manufacturing factory in 1948. An electronics

components unit was set up in Loni, near Pune, in 1959. In 1963, the Kalwa factory in

Maharashtra began to produce electronics measuring equipment. The company

subsequently started manufacturing telecommunication equipment in Kolkata.

Souring Ties Contd...

In the wake of the booming consumer goods market in 1992, PIL decided to modernize its

Salt Lake factory located in Kolkata. Following this, the plant's output was to increase from

a mere 40000 to 2.78 lakh CTVs in three years. The company even expected to win the

Philips Worldwide Award for quality and become the source of Philips Exports in Asia. PIL

wanted to concentrate its audio and video manufacturing bases of products to different

geographic regions.

In line with this decision, the company relocated its audio product line to Pune. In spite of

the move that resulted in the displacement of 600 workers, there were no signs of discord

largely due to the unions' involvement in the overall process. By 1996, PIL's capacity

expansion plans had fallen way behind the targeted level.

The unions realized that the management might not be able to complete the task and that

their jobs might be in danger. PIL on the other hand claimed that it had been forced to go

slow because of the slowdown in the CTV market. However, the unconvinced workers

raised voices against the management and asked for a hike in wage as well. PIL claimed

that the workers were already overpaid and under productive. The employees retaliated

by saying that said that they continued to work in spite of the irregular hike in wages.

These differences resulted in a 20-month long battle over the wage hike issue; the go-slow

tactics of the workers and the declining production resulted in huge losses for the

company.

In May 1998, PIL announced its decision to stop operations at Salt Lake and production

was halted in June 1998. At that point, PWU members agreed to the Rs 1178 wage hike

offered by the management. This was a climbdown from its earlier stance when the union,

along with the PEU demanded a hike of Rs 2000 per worker and other fringe benefits. PEU,

however, refused to budge from its position and rejected the offer. After a series of

negotiations, the unions and the management came to a reasonable agreement on the

issue of the wage structure.

Selling Troubles

In the mid-1990s, Philips decided to follow Philips NV's worldwide strategy of having a

common manufacturing and integrated technology to reduce costs. The company planned

to set up an integrated consumer electronics facility having common manufacturing

technology as well as suppliers base. Director Ramachandran stated that the company had

plans to depend on outsourcing rather than having its own manufacturing base in the

future. The company selected Pune as its manufacturing base and decided to get the Salt

Lake factory off its hands

In tune with this decision, the employees were appraised and severance packages were

declared. Out of 750 workers in the Salt Lake division, 391 workers opted for VRS. PIL then

appointed Hong Kong and Shanghai Banking Corporation (HSBC) to scout for buyers for

the factory. Videocon was one of the companies approached. Though initially Videocon

seemed to be interested, it expressed reservations about buying an over staffed and under

utilized plant.To make it an attractive buy, PIL reduced the workforce and modernised the

unit, spending Rs 7.1 crore in the process. In September 1998, Videocon agreed to buy the

factory through its nominee, Kitchen Appliances India Ltd. The total value of the plant was

ascertained to be Rs 28 crore and Videocon agreed to pay Rs 9 crore in addition to taking

up the liability of Rs 21 crore. Videocon agreed to take over the plant along with the

employees as a going concern along with the liabilities of VRS, provident fund etc.

The factory was to continue as a manufacturing center securing a fair value to its

shareholders and employees. In December 1998, a resolution was passed at PIL's annual

general meeting (AGM) with a 51% vote in favor of the sale. Most of the favorable votes

came from Philips NV who held a major stake in the company. The group of FI shareholders

comprising LIC, GIC and UTI initially opposed the offer of sale stating that the terms of the

deal were not clearly stated to them. They asked for certain amendments to the

resolutions, which were rejected by PIL

Commenting on the FIs opposing the resolution, company sources said, "it is only that the

institutions did not have enough time on their hands to study our proposal in detail, and

hence they have not been able to make an informed decision." Defending the company's

decision not to carry out the amendments as demanded by the financial institutions,

Ramachandran said that this was not logical as the meeting was convened to take the

approval of the shareholders, and the financial institutions were among the shareholders

of the company. Following this, the FIs demanded a vote on the sale resolution at an

EGM.After negotiations and clarifications, they eventually voted in favor of the resolution.

The workers were surprised and angry at the decision. Kiron Mehta said, "The

management's decision to sell the factory is a major volte face considering its efforts at

promoting it and then adding capacity every year." S.N.Roychoudhary of the Independent

Employees Federation in Calcutta said, "The sale will not profit the company in any way.

As a manufacturing unit, the CTV factory is absolutely state-of-the-art with enough

capacity. It is close to Kolkata port, making shipping of components from Far Eastern

countries easier. It consistently gets ISO 9000 certification and has skilled labor. Also, PIL's

major market is in the eastern region."The unions challenged PIL's plan of selling the CTV

unit at 'such a low price of Rs 9 crore' as against a valuation of Rs 30 crore made by Dalal

Consultants independent valuers. PIL officials said that the sale price was arrived at after

considering the liabilities that Videocon would have along with the 360 workers of the

plant. This included the gratuity and leave encashment liabilities of workers who would be

absorbed under the same service agreements. The management contended that a VRS

offer at the CTV unit would have cost the company Rs 21 crore. Refuting this, senior

members of the union said, "There is no way that a VRS at the CTV unit can set Philips by

more than Rs 9.2 crore."

They explained that PIL officials, by their own admission, have said that around 200 of the

360 workers at the CTV unit are less than 40 years of age and a similar number have less

than 10 years work experience. The unions

also claimed that they wrote to the FIs' about their objection. The workers then

approached the Dhoots of Videocon requesting them to withdraw from the deal as they

were unwilling to have Videocon as their employer. Videocon refused to change its

decision. The workers then filed a petition in the Kolkata High Court challenging PIL's

decision to sell the factory to Videocon. The unions approached the company with an offer

of Rs 10 crore in an attempt to outbid Videocon They claimed that they could pay the

amount from their provident funds, cooperative savings and personal savings. But PIL

rejected this offer claiming that it was legally bound to sell to Videocon and if the offer fell

through, then the union's offer would be considered along with other interested parties. PIL

said that it would not let the workers use the Philips brand and that the workers could not

sell the CTVs without it. Moreover the workers were taking a great risk by using their

savings to buy out the plant. Countering this, the workers said that they did not trust

Videocon to be a good employer and that it might not be able to pay their wages. They

followed it up with proofs of Videocon's failure to make payments in time during the course

of its transactions with Philips. In view of the rejection of its offer by the management, the

union stated in its letter that one of its objection to the sale was that the objects clause in

the memorandum of association of Kitchen Appliances did not contain any reference to

production of CTVs. This makes it incompetent to enter into the deal. The union also

pointed out that the deal which was signed by Ramachandran should have been signed by

at least two responsible officials of the company. As regards their financial capability to

buy out the firm, the union firmly maintained that it had contacts with reputed and

capable businessmen who were willing to help then. In the last week of December 1998,

employees of PIL spoke to several domestic and multinational CTV makers for a joint

venture to run the Salt Lake unit. Kiron Mehta said, "We can always enter into an

agreement with a third party. It can be a partnership firm or a joint venture. All options are

open. We have already started dialogues with a number of domestic and multinational TV

producers." It was added that the union had also talked to several former PIL directors and

employees who they felt could run the plant and were willing to lend a helping hand.

Clarifying the point that the employees did not intend to takeover the plant, Mehta said, "If

Philips India wants to run the unit again, then we will certainly withdraw the proposal. Do

not think that we are intending to take over the plant."

In March 1999, the Kolkata High Court passed an order restraining any further deals on the

sale of the factory. Justice S.K.Sinha held that the transfer price was too low and PIL had to

view it from a more practical perspective.The unrelenting PIL filed a petition in the Division

bench challenging the trial court's decision. The company further said that the matter was

beyond the trial court's jurisdiction and its interference was unwarranted, as the price had

been a negotiated one.The Division bench however did not pass any interim order and PIL

moved to the Supreme Court. PIL and Videocon decided to extend their agreement by six

months to accommodate the court orders and the worker's agitation.

Judgement Day

In December 2000, the Supreme Court finally passed judgement on the controversial

Philips case. It was in favour of the PIL. The judgement dismissed the review petition filed

by the workers as a last ditch effort. The judge said that though the workers can demand

for their rights, they had no say in any of the policy decisions of the company, if their

interests were not adversely affected. Following the transfer of ownership, the

employment of all workmen of the factory was taken over by Kitchen Appliances with

immediate effect. Accordingly, the services of the workmen were to be treated as

continuous and not interrupted by the transfer of ownership. The terms and conditions of

employment too were not changed.Kitchen Appliances started functioning from March

2001. This factory had been designated by Videocon as a major centre to meet the

requirements of the eastern region market and export to East Asia countries. The Supreme

Court decision seemed to be a typical case of 'all's well that ends well.' Ashok Nambissan,

General Counsel, PIL, said, "The decision taken by the Supreme Court reiterates the

position which Philips has maintained all along that the transaction will be to the benefit of

Philips' shareholders." How far the Salt Lake workers agreed with this would perhaps

remain unanswered

Case 4:

Introduction

For right or wrong reasons, Bata India Limited (Bata) always made the headlines in the financial dailies and business magazines during the late 1990s. The company was headed by the 60 year old managing director William Keith Weston (Weston). He was popularly known as a 'turnaround specialist' and had successfully turned around many sick companies within the Bata Shoe Organization (BSO) group. By the end of financial year 1999, Bata managed to report rising profits for four consecutive years after incurring its first ever loss of Rs 420 million in 1995. However, by the third quarter ended September 30, 2000, Weston was a worried man. Bata was once again on the downward path. The company's nine months net profits of Rs 105.5 million in 2000 was substantially lower than the Rs 209.8 million recorded in 1999. Its staff costs of Rs 1.29 million (23% of net sales) was also higher as compared to Rs 1.18 million incurred in the previous year. In September 2000, Bata was heading towards a major labour dispute as Bata Mazdoor Union (BMU) had requested West Bengal government to intervene in what it considered to be a major downsizing exercise.

Background Note

With net revenues of Rs 7.27 billion and net profit of Rs 304.6 million for the financial year ending December 31, 1999, Bata was India's largest manufacturer and marketer of footwear products. As on February 08, 2001, the company had a market valuation of Rs 3.7 billion. For years, Bata's reasonably priced, sturdy footwear had made it one of India's best known brands. Bata sold over 60 million pairs per annum in India and also exported its products in overseas markets including the US, the UK, Europe and Middle East countries. The company was an important operation for its Toronto, Canada based parent, the BSO group run by Thomas Bata, which owned 51% equity stake The company provided employment to over 15,000 people in its manufacturing and sales operations throughout India. Headquartered in Calcutta, the

company manufactured over 33 million pairs per year in its five plants located in Batanagar (West Bengal), Faridabad (Haryana), Bangalore (Karnataka), Patna (Bihar) and Hosur (Tamil Nadu). The company had a distribution network of over 1,500 retail stores and 27 wholesale depots. It outsourced over 23 million pairs per year from various small-scale manufacturers Throughout its history, Bata was plagued by perennial labor problems with frequent strikes and lockouts at its manufacturing facilities. The company incurred huge employee expenses (22% of net sales in 1999). Competitors like Liberty Shoes were far more cost-effective with salaries of its 5,000 strong workforce comprising just 5% of its turnover. When the company was in the red in 1995 for the first time, BSO restructured the entire board and sent in a team headed by Weston. Soon after he stepped in several changes were made in the management. Indians who held key positions in top management, were replaced with expatriate Weston taking over as managing director. Mike Middleton was appointed as deputy managing director and R. Senonner headed the marketing division.They made several key changes, including a complete overhaul of the company's operations and key departments. Within two months of Weston taking over, Bata decided to sell its headquarter building in Calcutta for Rs 195 million, in a bid to stem losses.

The company shifted wholesale, planning & distribution, and the commercial department to Batanagar, despite opposition from the trade unions Robin Majumdar, president, co-ordination committee, Bata Trade Union, criticized the move, saying: "Profits may return, but honor is difficult to regain." The management team implemented a massive revamping exercise in which more than 250 managers and their juniors were asked to quit. Bata decided to stop further recruitment, and allowed only the redundant staff to fill the gaps created by superannuation and retirements. The management offered its staff an employment policy that was linked to sales-growth performance. In 1996, for the first time in Bata's 62-year-old history, the company signed a long-term bipartite agreement. This agreement was signed without any disruption of work. Recalls Majumdar: "We showed the management that we could be as productive as any other union in the country." In the six-year period 1993-99, Bata had considerably brought down the staff strength of its Batanagar factory and Calcutta offices to 6,700. In fiscal 1996, Bata was back in the black with the company reporting net profits of Rs 41.5 million on revenues of Rs 5.9 billion (Rs 5.32 billion in 1995). In fiscal 1997, Bata further consolidated the gains with the company reporting net profits of Rs 167 million on revenues of Rs 6.7 billion. A senior HR manager at the company admitted that with an upswing in Bata's fortunes, even its traditionally intransigent workers were motivated to do better. In 1997, Bata workers achieved 93% of their production targets. The management rewarded the workers with a 17% bonus, up from the 15% given in 1996. By the end of 1997, Bata still faced problems of a high-cost structure and surplus labour. Infact, the turnaround had made the unions more aggressive and demanding. Weston had failed to strike a deal with the All India Bata Shop Managers Union (AIBSMU) since the third quarter of 1997. The shop managers were insisting that Bata honor the 1990 agreement, which stipulated that the management would fill up 248 vacancies in its retail outlets. It also opposed the move to sack all the cashiers in outlets with annual sales of less than Rs 5 million, which meant elimination of 690 jobs. In 1999, the Bata management in a bid to further cut costs announced the phasing out of several welfare measures at its Batanagar Unit. Among the proposals was near total withdrawal of management subsidies, canteen facilities, township maintenance, electricity and health care schemes for the employees' families.Other measures were aimed at increasing productivity, reorganizing some departments and extending working days for some essential services. On January 14, 1999, the BMU submitted their charter of demands to the management. The wish list mainly revolved around economic issues. In the list of non-economic issues was the demand for reinstatement of the four dismissed employees 1. The

Union had also demanded the introduction of a scheme for workers participation in management.On the economic front, the Union had demanded a wage hike of around Rs. 90 per week, additional allowances as provident fund over the statutory limit by the management, increase in 'plan bonus' and introduction of attendance bonus for migrant workers. In July 1999, BMU was finally able to strike a deal. It signed a three-year wage agreement that included fiscal benefits such as a lumpsum payment of arrears of Rs. 4,000 per employee. The management agreed to include 10% of the 400 contract laborers at Batanagar in its staff. Other gains included an average increase of Rs. 45.50 in the weekly pay of the 5,600 employees in Batanagar, an improved rate of DA and increase in tiffin allowance. However, canteen rates had been doubled from Rs. 0.75 for a meal to Rs. 1.50. For the 500 families staying at Batanagar, the electricity rates had been doubled to Rs. 0.48 per unit. BMU was successful in scuffing the management's plan of dismantling the public health unit in which 80 people were employed. In September 1999, the West Bengal State labour tribunal in an order justified and upheld Bata's action of suspending and subsequent dismissing of three executive members of the BMU. The tribunal had provided no relief to the dismissed members who had been found guilty of assaulting the chief welfare officer at the Batanagar unit on November 26, 1996.

Assault Case

More than half of Bata's production came from the Batanagar factory in West Bengal, a state notorious for its militant trade unions, who derived their strength from the dominant political parties, especially the left parties. Notwithstanding the giant conglomerate's grip on the shoe market in India, Bata's equally large reputation for corruption within, created the perception that Weston would have a difficult time. When the new management team weeded out irregularities and turned the company around within a couple of years, tackling the politicized trade unions proved to be the hardest of all tasks. On July 21, 1998, Weston was severely assaulted by four workers at the company's factory at Batanagar, while he was attending a business meet.The incident occurred after a member of BMU, Arup Dutta, met Weston to discuss the issue of the suspended employees. Dutta reportedly got into a verbal duel with Weston, upon which the other workers began to shout slogans. When Weston tried to leave the room the workers turned violent and assaulted him. This was the second attack on an officer after Weston took charge of the company, the first one being the assault on the chief welfare officer in 1996. Soon after the incident, the management dismissed the three employees who were involved in the violence. The employees involved accepted their dismissal letters but subsequently provoked other workers to go in for a strike to protest the management's move. Workers at Batanagar went on a strike for two days following the incident Commenting on the strike, Majumdar said: "The issue of Bata was much wider than that of the dismissal of three employees on grounds of indiscipline. Stoppage of recruitment and continuous farming out of jobs had been causing widespread resentment among employees for a long time." Following the incident, BSO decided to reconsider its investment plans at Batanagar. Senior vice-president and member of the executive committee, MJZ Mowla, said2: "We had chalked out a significant investment programme at Batanagar this year which was more than what was invested last year. However, that will all be postponed." The incident had opened a can of worms, said the company insiders. The three men who were charge-sheeted, were members of the 41-member committee of BMU, which had strong political connections with the ruling Communist Party of India (Marxist). The trio it was alleged, had in the past a good rapport with the senior managers, who were no longer with the organization. These managers had reportedly farmed out a large chunk of the contract operations to this trio. Company insiders said the recent violence was more a political issue rather than an industrial relations problem,

since the workers had had very little to do with it. Seeing the seriousness of the issue and the party's involvement, the union, the state government tried to solve the problem by setting up a tripartite meeting among company officials, the labor directorate and the union representatives. The workers feared a closedown as the inquiry proceeded.

Industrial Relations

For Bata, labor had always posed major problems. Strikes seemed to be a perennial problem. Much before the assault case, Bata's chronically restive factory at Batanagar had always plagued by labor strife. In 1992, the factory was closed for four and a half months. In 1995, Bata entered into a 3-year bipartite agreement with the workers, represented by the then 10,000 strong BMU, which also had the West Bengal government as a signatory.

It was in 1998, that the company for the first time signed another long-term bipartite agreement with the unions without any disruption of work. Apprehensive about labor problems spilling over to other units, the company entered into similar long-term agreements with the unions at its manufacturing units at Bangalore and Faridabad. In February 1999, a lockout was declared in Bata's Faridabad Unit. Middleton commented that the closure of the unit would not have much impact on the company's revenues as it was catering to lower-end products such as canvas and Hawaii chappals. The lock out lasted for eight months. In October 1999, the unit resumed production when Bata signed a three-year wage agreement. On March 8, 2000, a lockout was declared at Bata's Peenya factory in Bangalore, following a strike by its employee union. The new leadership of the union had refused to abide by the wage agreement, which was to expire in August 2001. Following the failure of its negotiations with the union, the management decided to go for a lock out. Bata management was of the view that though it would have to bear the cost of maintaining an idle plant (Rs. 3 million), the effect of the closures on sales and production would be minimal as the footwear manufactured in the factory could be shifted to the company's other factories and associate manufacturers. The factory had 300 workers on its rolls and manufactured canvas and PVC footwear. In July 2000, Bata lifted the lockout at the Peenya factory. However, some of the workers opposed the company's move to get an undertaking from the factory employees to resume work. The employees demanded revocation of suspension against 20 of their fellow employees. They also demanded that conditions such as maintaining normal production schedule, conforming to standing orders and the settlement in force should not be insisted upon. In September 2000, Bata was again headed for a labour dispute when the BMU asked the West Bengal government to intervene in what it perceived to be a downsizing exercise being undertaken by the management.BMU justified this move by alleging that the management has increased outsourcing of products and also due to perceived declining importance of the Batanagar unit. The union said that Bata has started outsourcing the Power range of fully manufactured shoes from China, compared to the earlier outsourcing of only assembly and sewing line job. The company's production of Hawai chappals at the Batanagar unit too had come down by 58% from the weekly capacity of 0.144 million pairs. These steps had resulted in lower income for the workers forcing them to approach the government for saving their interests.

PS: Weston resigned on January 30, 2001. This came as a severe setback to the Bata management

Activity 1:

The first stage in the process is to make sure that the job required is made clear. There are two important

documents that are likely to be part of this process - the job description and the person specification.

Job DescriptionThe job description will have been drawn up based on an analysis of the job itself. This may have been

discussed beforehand by various members of the department and senior managers. The job description

will contain details of what the job entails. It would normally include the following information:

Job title: for example, Senior lecturer in business studies.

Department: for example, Faculty of Business and Management

Hours of work: for example, 35 hours per week

Responsible to: for example, Moses Kabba, Faculty Manager

Responsible for: for example, two junior members of the faculty

Scope of the post: for example, teaching on the BTEC and AS/A2 business programme and for

managing the adult learning facility in the college.

Responsibilities: for example, the post holder will contribute to the teaching of the BTEC

Business programme throughout the college and be expected to teach AS/A2 business studies etc.

The job description gives the applicant details about what they would be expected to do and helps them to

decide whether they have the skills, experience and qualifications to carry out the job. Applicants should

therefore be able to demonstrate that they can do most of the tasks specified. The job description also

gives the selection team a clear outline of what the job involves and helps them to match the skills of

applicants with the job they are expecting them to do.

Person SpecificationThe person specification will provide the applicant with details about the sort of person that the

organisation is seeking to fill the post. This will include details about the person's qualifications and skills,

their communication skills, the experience they are expected to have and their ability to work as part of a

team or individuality. Many organisations classify these in two groups - 'essential' and 'desirable'. The

table below gives a brief example.

Your first task is to devise a job description and person specification for the post at your college/school.

You can either devise this from scratch or use an existing example on which to base the task. You could

ask your teacher/lecturer for a copy of their job description and person specification or go to the human

resources department and ask them for help in this. You could also try looking at existing job adverts and

getting a copy of the job description and person specification from this - remember, however, that these

things cost money to produce, so be careful about obtaining information in this way.

Activity 2:( Recruitment Process)

A medium sized business was seeking to recruit a product development manager in its research and development (R&D) section. The new person would be responsible for overseeing the process by which the new products the business was developing were prepared for launch onto the market.

The recruitment process involved placing adverts in trade magazines and the national press and the adverts resulted in over 60 applications. There were 5 people involved in the short listing process: the direct line manager; the head of the HR division; the assistant head of that

division; and two members of the new product development department - one from R&D and one from the launch team.

A short list of 7 candidates was drawn up. However, the assistant head of HR heard that a former trainee of the firm wanted to apply but could not get the application in by the deadline - she would be a strong candidate and the firm knew of her qualities. The head of HR agreed to let the application come in three days late and she was duly added to the shortlist.

On the day of the selection, each candidate had to do a presentation on the extent to which they matched the job description and person specification and what they felt they could bring to the job to further the company's objectives. This was followed by an interview. The candidate who had put in the late application did not turn up and the head of HR phoned her up. She said that she had not received a letter inviting her for interview and was not therefore aware that she was wanted. She agreed to come in and was allowed to miss doing the presentation although would be questioned on it in the same way that other candidates were.

At the end of the process, two clear candidates emerged, one of which was the late applicant. It was decided that she would be offered the position and after receiving the phone call from the assistant manager of the HR department, she duly accepted. The rest of the selection team took the responsibility of contacting the other candidates to tell them they were unsuccessful and to give them some feedback about their performance and why they were unsuccessful.

Later that evening, the head of HR received a phone call from the successful candidate telling her that she had gone back to her company where she had been working part time and told them of her success. They had responded by offering her a full time position and increasing her salary and she had decided to stay with them and thus did not want the position.

This meant that the candidate who was second had to be contacted and have the position explained to him. Fortunately for the firm, he understood and was happy to accept the position. Had he not, it could have involved the business in another round of selection which is an expensive process.

Things to do

Critically assess the recruitment and selection procedure of the firm in the light of this experience and write a 500 word report to the head of Human Resources on recommendations for any changes to the recruitment process for the firm.

The following questions are provided to guide you in your thinking and critical analysis.

Is the method of advertising for new positions appropriate?

Is the method of sifting through the applications and shortlisting efficient and effective?

How effective a means of discrimination between candidates is the presentation and interview

process?

How far would you say that the firm's process meets employment legislation in terms of equal

opportunities?

Activity 3(On selection procedure)

Part of the recommended assessment procedure for this unit is to take part in role-play activities.

Divide the class into four groups:

Group 1 is the recruitment team. Their task is to identify the key questions they are going to ask

candidates in an interview for a fictional job.

Group 2 will consist of the candidates - they must write a short letter of application (no more than

100 words) for the post.

Group 3 will identify, construct and assess an in-tray exercise for the candidates. This should not

take more than 20 minutes.

Group 4 will be observing the work of the three groups for feedback discussion.

Group 1 will interview each of the candidates - in private - but this could be videoed for later discussion.

They will then compare notes with Group 3 - then, together, make a decision as to who they would offer

the job to and why. The group should also identify some brief key points of feedback to the rest of the

unsuccessful candidates. Group 4 will offer their judgements on the process in a discussion session

following the activity.

Group 2: You should make your application on the basis that you have a degree and two years'

experience in a similar business environment. You are at liberty to sell yourself as much as possible

but remember, the interviewers may well ask you searching questions about the claims in your

application so ensure you can back up whatever you say!

Assignment 1: go to citehr.com, press registration, do the registration and then the verification code will be sent to you on your email id being provided by you.Continue and post a thread for the relevant answer of the query being asked by me on it.

Assignment 2:

Students are required to bring either a movie clip/ any video depicting the training being provided.

Assignment 3:

Lect 1:((Motivation through HR practices)

SAP is the largest producer of business software in the world.

Motivating its staff is a big job as it has some 29,000 of them in 50 different countries, and yet it claims to be among the best at doing this.

Indeed SAP has won awards for its innovative ways of keeping its staff happy.

It starts with the most obvious incentive of all - money.

After all, ask most people why they work and they'll answer in order to get paid and make a living and at SAP the staff are very well rewarded indeed.

"Our average basic salary here is around £45,000," says Adrian Farley, human resources director at SAP.

"It's a very good package and our staff enjoy exceptional benefits, as well as a bonus scheme, but we're competing for the very best people out there and often they will dictate their own terms."

Flexibility

Unlike a manufacturer which may see its machinery or equipment as its most valuable asset, SAP's success as a business depends fully on the brainpower of its employees and their ability to serve its clients - hence its efforts to keep them happy.

SAP has tried to create a flexible working environment and an incentive-based pay structure is designed to improve overall operational performance and productivity. To motivate and encourage, every employee's package includes fixed, flexible and incentive-based portions.

The flexible portion of each salary can be used to buy and sell annual leave, for dental or medical services, for pensions, life assurance and concierge services.

Pleasant offices

Furthermore, workers are provided with free lunch in the top-class restaurant, and the building is designed to encourage team-work and creativity.

Staff and their families are given private dental and health care, and access to other services like dry-cleaning. "The coffee lounges and workspaces are nice and bright throughout the building and this is good for teamwork," says Rachel Cortes, a customer relations manager.

"It cheers you up, and we've also got flexible benefits so I can buy holiday time or choose to contribute more to my pension, and a lot of the benefits are extended to family too."

But what if you're not a giant software conglomerate, and still want your staff to enjoy working for you?

Taking pride

Take Savoir Beds in west London for instance,

It's a much smaller, more traditional manufacturing business, but still has its own unique ways of motivating its workers.

Savoir has been making beds since 1905; each one costs £6,000 and it produces only six a week, so speed isn't the priority, quality is.

Workers here don't get bonuses for making more beds quicker, and the firm could not afford to match the salaries that SAP pays for example.

"Bonuses don't work here; instead we want the staff to take pride in what they do by working on the product from start to finish," says Alastair Hughes, managing director of Savoir.

Work of art

"Rather than have a production line with workers just operating on one part of the bed we actually encourage them to do the whole thing, and then when it's finished we ask them to sign the bed. Customers come in and meet the staff."

Customers write thank you letters to the person who made their bed, and everyone in the business has a sense of pride in what they do.

Two very different companies, but what they both make is an effort to motivate their workforce.

Whatever the business, the customers matter - or else!

Businesses large and small must look after their employees if they are going to meet the needs of customers.

The personal approach

SAP and Savoir Beds both believe in the personal approach. Staff are human beings whose needs differ - so the approach needs to be flexible.

SAP has a flexible remuneration package, a mix of fixed, flexible and incentive based parts.

The flexible part allows people to choose from these benefits:

Choice to take pay instead of holiday and visa versa medical care life assurance. It allows people to start early, finish late, work part-time for a period, have a sabbatical or take periods of unpaid leave.

The organisation is "flat" so there are few layers of management.

Benefits packages are common to all. The best benefits are not reserved for the top level staff.

The difference comes from salaries and bonuses - which are earned through incentive schemes.

The business has a strong bonus/reward culture so people expect those who do well to be paid well. There are no "fat cat" secrets. Everyone is on the same terms. They each have a contract - and no more.

If senior management fail they won't get a big pay-off when they are pushed out!

The staff have asked to see how the system works and SAP is working on making everything as transparent as possible.

How does the choice of benefits give opportunities to different sorts of people, young and old, married and single, parents and non-parents?

How does the mix of incentives to earn greater financial reward and the non-financial rewards stimulate staff to achieve?

Presentation Topics

Students will visit an industry to study the HR procedures being followed in that particular company preferably after interviewing the HR manager For Example, Fringe benefits given, leave procedures, bonuses, recruitment and selection procedures, Quality of work life, etc.

After this they are going to prepare the project including the HR manager’s interview and the above mentioned points and will be presenting through presentation.

Recruitment process of British Gas

British Gas is part of the Centric Group. It is the country’s best recognized energy brand. Centrica is a multinational company, with businesses in many countries. Centrica was formed in 1997 and consists of eight separate energy-related businesses, ranging from the supply of gas and electricity to consumers and organisations in the UK and Europe, to storage of gas for other providers, and drain and pipe work maintenance. The UK energy market is highly dynamic. Customers look for the best deals and are increasingly prepared to switch suppliers. In 2007, 900,000 customers switched energy providers. An energy company needs to show it is not just competitive on price, but that it can also provide the right levels of customer service to attract and retain customers. British Gas Services (BGS) does not supply gas – this is handled by other British Gas divisions.

The core BGS product is installation and maintenance services. BGS is the UK’s largest operator in the installation and maintenance of domestic central heating and gas appliances. It provides a maintenance and breakdown service for electrical white goods and home wiring. Through the Dyno brand, BGS also offers drain clearing services, plumbing and home security services.

To deliver these services, BGS needs high caliber staff. It employs more than 9,000 trained gas engineers to install and maintain central heating and gas appliances. This case study explores how BGS manages the recruitment and selection of new employees.

The role of human resource management

Managing a successful large business involves acquiring, developing and maintaining a wide range of resources. These resources include materials, buildings, land, equipment, technology and, crucially, people. Any organisation needs good employees who have the right skills to achieve the company’s aims and objectives. Human resource management (HRM) is the business function that focuses on the people aspects of an organisation. It ensures the efficient management of people in the business. It is responsible for ensuring that an organisation has the right people to deliver its overall business plan. Centrica, the parent corporation of BGS, has to deliver long-term profitability. Its shareholders expect the business to show a return on their investment by making profits, now and in the future. BGS needs to contribute to these profits. This means consistently meeting the needs of its customers with competitively priced products and services that give good returns to the company. BGS’s core customer base is residential consumers across the country. These customers expect top-class service at keen prices. If BGS does not meet this standard, the company may lose business to competitors.

To ensure customer satisfaction, BGS engineers must have the technical skills to undertake work to the required standard and the people skills to deliver good customer service. Through its engineer recruitment team, the British Gas Academy must therefore ensure that the company attracts and retains the best engineers. This involves

several complementary tasks. It requires planning to assess the BGS’s future needs for skilled employees. It requires a recruitment and selection programme to bring new people into the business. It requires a training operation to equip new recruits and existing employees with the right skills.

Importantly, BGS must also ensure that it retains its best people. It is much more cost effective to retain trained and highly skilled staff than recruit and train up new people. BGS seeks to retain people by offering a mix of financial and non-financial benefits. As well as good pay and a pension scheme, the company provides employees with the opportunity to buy shares in Centrica and it offers a great place to work and high-class training.

As an expanding business, BGS needed to increase its workforce to meet customer demand. At the end of 2002, BGS established the British Gas Academy. The Academy has helped to develop and refocus training facilities to handle the extra training requirement in recruiting an additional 5,000 employees into the engineering workforce.

There are several training routes:

• BGS runs an intensive apprenticeship programme. This is delivered in training centers Trainees should expect to qualify within 12 to 14 months. All domestic gas engineers become fully acquainted with the latest computer-aided diagnostic technology.

• There are also traineeships, which provide a way for new recruits to learn about the gas industry and gain relevant skills and qualifications.

• BGS provides technical training for all its engineers throughout their careers. This ensures that its employees are kept up-to-date with new information and technologies to enable them to provide the best service possible.

Training does not simply focus on technical skills and knowledge. Most employees have direct contact with customers, so it is important that they have good people skills. Awareness training is provided for employees across British Gas through an online learning package.

Recruitment

As part of its workforce planning, BGS implements a diversity and inclusion strategy using tailored action plans. This means it actively seeks new recruits from a wide range of backgrounds. The need to recruit a diverse engineering workforce is seen as critical by BGS. It plans recruitment to ensure it has a socially inclusive workforce. This is important as it will enable BGS to reflect the diversity of its customer base. For example, it is useful to have employees from different nationalities and backgrounds to communicate with customers that do not speak English as a first language. Recruiting more women engineers may help to attract female customers. To dispel the myth that only men can be good engineers, BGS runs a Georgina and the Dragon campaign. This has had some success. The British Gas Academy has won an award from Women into Science and Engineering as well as a national award from the Council for Registered Gas Installers (CORGI) for its efforts to encourage and attract women into the engineering workforce and into plumbing and associated trades. In May 2008 the recruitment team at BGS was recognised by Opportunity Now, winning the prestigious award for ‘Inspiring the workforce of the future’.BGS tries to appeal to a varied and diverse audience when promoting its apprenticeships. Toadvertise opportunities widely, BGS uses specialist Sky channels like Parliamentary Projects TV, which focuses on careers, and Passion TV, which is aimed at the black community. In print media it uses

women’s magazines; publications targeted at ethnic minorities such as The Muslim Week as well as other careers directories for the same reason. Other channels include radio, newspapers, BGS’s website (www.britishgasacademy.co.uk) and a DVD for schools. Recruiting gas engineers of the right level is important. Candidates for a British Gas apprenticeship must be at least 17 years old, have a minimum of four GCSEs at grade C or above or equivalent (e.g. NVQs) and hold at least a provisional driving license. However, they need more than academic qualifications, they must be able to show some aptitude for custom service, such as being able to listen to customers and understand their requirements. BGS uses an online application form. To help BGS decide an applicant’s suitability, this includes a value-based questionnaire. This requires responses to a series of statements about attitudes to work. There are 90 statements in all, and an applicant’s overall responses are rated either green, amber or red. The colour reflects the attitudes the applicant has about work and people. This helps to show which roles a person is best suited to. BGS does not take applicants with red ratings further as they may not show a ‘fit’ with the company requirements. However after an initial screening, green and amber applicants are invited an interview and assessment centre for the final selection process. Here, candidates must show evidence of qualifications, ID and driving licence.

Selection

At the BGS assessment centre the emphasis is very much upon ‘core competencies’ and ‘life skills’. Life skills are personal skills that are likely to affect the customer experience when someone is working in the field. British Gas engineers needs to show courtesy and politeness, for example. These are personal qualities that have a direct impact upon customer perception. Core competencies involve team working, interpersonal skills (such as dealing with people), motivation and responding to change. These are crucial skills that can affect the way an individual fits in and works within an organisation.

Candidates attend the centre for a half-day assessment. This has three elements:

1) Interview is based questions related to complete online value based questionnaire.

2) Role plays to demonstrate the customer services.

3) Manual test including a wiring exercise, to know whether the candidate is able to handle the delicate components?

The total scores from the three-part assessment help BGS to decide who receives a job offer. Candidates are notified of the outcome within 14 days. All candidates can receive feedback. For those candidates offered a job, BGS provides the usual job benefits including a van from the outset and a competitive starting salary. The new recruits then go on to benefit from BGS’ comprehensive programme of training through its Academy. This ensures that they are given the best start in their new careers. It also builds employee motivation and commitment to the

Company. Recruiting and selecting staff is an expensive process. By following a robust selection programme in this way, BGS is able to ensure it gets the right people with the right skills. It also means it maximizes the benefit from its investment.

Conclusion

Recruitment and selection at British Gas Services is driven by the need to maintain the competitive position of the company within the energy market. Domestic gas customers demand the very highest standards of service. They can be assured that BGS engineers have high-level skills and expertise through its careful specification of entry qualifications

followed by top quality training. BGS also assesses the personal attributes of staff through role play and questionnaires as these influence customers’ perceptions of the service and the company. Great care is taken in determining the organisation’s future staffing needs. This drives the recruitment and selection process to ensure BGS is seen as offering dynamic and exciting career paths for people of all backgrounds. By developing and nurturing its people, BGS ensures that new recruits have the right qualities to help the business to compete.

Questions

1. What is the main purpose of workforce planning in BGS?

2. To what extent is workforce planning important in helping BGS achieve its aims?

3. What benefits do BGS’ application, recruitment and selection processes give to both applicants and the company?

http://www.bized.co.uk/learn/business/hrm/employ/recruit/student.htm: imp for lects