7HRC – Human Resource Management in Context

Section A – Case Study

Note: In your responses, you are allowed to improvise or add to the case study details provided below. However, the case study should not be changed or compromised in any way.

Trufflebags Ltd is a long-established family business. The company manufactures up-market confectionery products (chocolates, fudge, toffees, soft drinks and ice creams) at a factory in the Midlands which employs 50 people. The product range is then mainly sold through a chain of thirty small, branded Trufflebags shops which are prominently located on high streets in cities and towns across the UK. The retail division employs around 150 people at any one time, many of whom work on a part-time basis. There is a head office located adjacent to the factory at which a further team of 20 people are employed in management and administrative roles.

The Chairman and Managing Director of Trufflebags is the formidable Kassia Candy, who inherited the company from her father who founded it sixty years ago. She has run it for the past thirty years, for most of the time with considerable success. She oversaw the opening of a flagship shop in London’s Covent Garden and greatly extended the company’s product range. Under her leadership the brand was consolidated, Trufflebags shops becoming well- known as excellent places for people to purchase gifts and treats for themselves. The company continues to enjoy high levels of brand recognition in the UK and remains popular with its loyal, older customer base who have shopped for its products for many years.

In the past few years, however, business conditions have become much more challenging. The company has lost about 30% of its overall market share and has seen its retail sales dwindle rapidly. The biggest concern is that the average footfall on the high streets where Trufflebags’ shops are located has declined by around 4% year-on-year for the past five years. The company has also received some reports from mystery shoppers it has employed which have given poor feedback on levels of customer service offered in its stores. Meanwhile new competitors with a more sophisticated, original and up-to-date brand image have attracted a lot of business away from the company’s outlets, building a prominent online and global reputation which the company has been unable to match.

At the same time it is costing Trufflebags a great deal more to import the core products that go into their most popular products, while many fixed costs associated with running high street retail outlets have increased. In the last year the company went into the red for the first time in its history. Losses of over £500,000 were reported by its accountants.

On the HR front things have been going badly too. Staff turnover levels are higher than at any time in the company’s history and managers are struggling to recruit new staff to work in the retail outlets who have either the experience or the aptitude required to meet the company’s expectations. Absence levels are running at high levels too, requiring a degree of overstaffing to ensure that stores can open and close on time.

Just when Kassia thought that things couldn’t get any worse, Trufflebags has been the subject of a series of negative stories in a local newspaper that have been picked up on social media. The firm’s factory operation has been labelled the worst place to work in the county it is based in. Some former staff members have been interviewed complaining that they were all employed on insecure contracts on minimum wage rates and that insufficient attention is given to health and safety training. Poor reviews have also been posted by employees on the Glassdoor website. A week later further stories then circulated in social media criticising the unhealthy nature of the company’s products and the amount of single-use plastic packaging it uses. Claims are also made that it imports products grown on plantations that use “slave labour”. These stories are all considerable exaggerations and in some respects untrue, but they are doing a lot of damage to Trufflebags’ hard won corporate reputation.

You work for a firm of consultants that has been hired to advise Kassia Candy about the steps she needs to take to start turning round the fortunes of Trufflebags over the next year. You are asked to make a number of contributions to a briefing paper that will be sent to her. The following questions and tasks are assigned to you. In each case set out the key points you would make and how you would justify them:

1) What different factors are combining to reduce over time the number of people walking down high streets in towns and cities?

2) Provide an analysis which explains why Truffebags’ general and HR business costs are increasing.

3) Drawing on examples of published research or organisational practice explain what general steps Trufflebags managers might take to reverse the company’s poor recent record as far as recruitment, retention and absence are concerned.

4) What advice would you give Kassia about the financial and HR steps she should take to re-establish Trufflebags’ corporate reputation?

It is recommended that you spend around 25% of your time on each of Tasks 1, 2, 3 and 4

Section B

Answer FIVE questions in this section, ONE per subsection A to E. You may include diagrams, flowcharts or bullet points to clarify and support your answers, so long as you provide an explanation of each.

1. It is often argued that we are currently seeing a profound change in the way that organisations are managed. This is often characterised as representing a shift from a ‘mechanistic’ form of organisational design and management style to approaches which are ‘organic’. The change manifests itself in fewer levels of management hierarchy, less bureaucracy, decentralised decision-making and less tightly defined job boundaries.

i) Drawing on published research or examples of practice, explain how far you agree with this observation and why.

ii) What factors in our business environment strengthen the case for those who would like to see the evolution of a more organic approach to management?

2. Every organisation has a range of stakeholders who have a legitimate interest in its survival and long-term success. The extent to which managers take account of these groups tends to vary depending on how much power stakeholders exercise over them.

You are asked to undertake and present a brief analysis of your own organisation’s main stakeholders and stakeholder groups. Identify AT LEAST FOUR distinct examples, in each case explaining why they should be considered legitimate stakeholders, the nature and extent of their power and how far their interests are, in practice, considered when managerial decisions are taken.

3. You attend a meeting to which all the managers employed by your organisation have been invited. Your Chief Executive Officer (CEO) is there to brief everyone about key strategic objectives for the coming three years.

After setting out her broad vision, when answering a question she states that her preference is to pursue an 'emergent strategy' rather than a 'rational strategy'.

You are asked by your colleagues to explain this distinction with some examples. You are also asked to explain the circumstances in which each approach is likely to be more effective. What would you say? Justify your answer.

4. When new managers are appointed to senior jobs in organisations they are often advised to avoid falling into the trap of trying to achieve too much all at once. When this is attempted limited achievement often results because attention and energy is spread too thinly. They are thus well advised to set themselves a small number of realistic, strategic objectives to prioritise. Achieving these then serves both to increase their confidence as managers and the confidence their organisations have in them.

Assume that you have been promoted into a senior (or more senior) HR management role in your own organisation. What THREE initial, strategic objectives would you set yourself? Justify your choice, explaining why you consider these to be priorities. State what specific measures you will use to track progress towards achieving them in practice.

5. The globalisation of the world trading and economic system has been one of the most significant trends in the business environment for some years now. The current spell of globalisation is generally considered to have started over fifty years ago, moving at a faster pace since the early 1990s. Its consequences for product markets and labour markets, both domestically and internationally have been profound.

i) Drawing on research explain why the trend towards greater globalisation has occurred and why it appears to have accelerated over the past twenty-five years.

ii) What do you think will be the most significant consequences for your industry if the trend towards greater globalisation continues? Justify your answer.

6. You receive the following e-mail from a friend who works in HR for a growing technology company employing 1000 people which is based in your country.

“Hi. I need your advice. Awesome news. My company has just announced its intention to take over a competitor which employs 350 people across three continents! Suddenly we are going to be managing an international workforce. We are going to need to send some of our managers overseas to manage these operations over the next three months. I have been asked to brief the CEO about the main HR actions that need to be taken to help ensure the takeover goes well. What should I say?”

Draft a helpful response setting out and justifying FOUR key points, making reference to research.

7. In nearly every country of the world populations are ageing. Since 1950, according to the Organisation for Economic and Cultural Development (OECD), the median age in industrialised countries has increased from 29 to 39. In the UK in this time the median age increased from 35 to nearly 41. There is every reason to anticipate that this trend towards an older population will further increase in the future.

i) Explain why populations are ageing so rapidly.

ii) What are the most important implications of this trend for:

a. commercial organisations

AND

b. HR management.

Justify your answers, drawing on published research and/or examples.

8. Your manager reads an article in which it is stated that the early 2020s will see the widespread adoption of IT devices which create a ‘virtual reality’ allowing their users to simulate the experience of being present in different places. Such devices will enable us to interact ‘face to face’ with others who are in fact physically located some distance away, potentially on the opposite side of the world. Such devices are also likely to be able to offer ‘augmented reality’ for their users, for example by translating conversations simultaneously into other languages so that two people can talk directly to one another despite having no knowledge of one another’s languages.

You are asked to write a briefing paper speculating about what the advent of virtual reality may mean for working practices and HR activities in your organisation. What key points would you make? Justify your answer.

9. Political debate in industrialised countries has traditionally focused primarily around issues relating to economic policy such as competitiveness, free markets, taxation and spending on public services. Over time, however, different debates are achieving much greater prominence. One example is the rise of concern about the environment and ways of achieving more sustainable forms of economic development. Another is a form of ‘identity politics’ which gives much greater prominence to debates about, for example social mobility, nationhood, overseas migration, gender, race, ethnicity and sexuality.

i) Why do you think that this apparent shift in the nature of our political environment is occurring?

ii) What are the major potential future implications for organisations and for HR management in your country if the trend continues?

10. Your organisation’s HR department has been asked to organise a one day training event for line managers to brief them on areas of employment law. They need to know more about these in order to ensure that the need to defend costly and time consuming Employment Tribunal cases is avoided. You are asked to lead a session lasting for around an hour.

i) What area of employment law would you choose to focus on in your session and why?

ii) What THREE major, specific learning outcomes would you want your audience to meet? Justify your answer.

END OF THE EXAMINATION

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