Natural Knibbles Case Study

Natural Knibbles, an established health food company, is facing a number of challenges due to changes within the market and business environment. To fix these problems, it is important to outline the role of the HR manager, as well as identify the HRM activities and steps that Natural Knibbles would need to take to develop an effective HR plan. It is important for the HR manager to be involved in the management team, and have the opportunity to contribute to the organisations’ strategic decisions.

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HR managers take a more strategic approach by gaining a better understanding of the organisation, the employees, stakeholders, products and finances, helping them fulfil their role by translating business strategy into action. While HRM is responsible for managing employer/employee relationships, it also involves ‘the acquisition, development, reward and motivation, maintenance and departure of an organisation’s human resources’ (Stone, 2008 p11). HR Planning involves planning, organising and reviewing human resource activities to ensure that the right people are employed at the right time to help achieve organisational strategic objectives.

In order to address these issues, relevant factors affecting the organisation in this change process will be outlined. Management of Natural Knibbles will be informed of the policies and procedures, as the report outlines the importance of developing an effective HR plan to achieve the organisations’ strategic objectives. In order to develop an effective HR plan that will support the proposed changes and be fair to all employees, the HR manager at Natural Knibbles needs to be able to forecast the organisation’s future HR requirements. Three sets of forecasts are required; a forecast for demand for human resources, a forecast for supply of external human resources and a forecast of the supply of human resources available within the organisation’ (Stone 2008 p60). 3. 0Problem Analysis and justification Natural Knibbles is currently facing a number of challenges due to changes within the business and market environment. To fix these problems, the following HR issues and challenges need to be addressed by the company. 3. 1The Role of the HR manager The HR manager is a crucial part of the management team.

The role of the HR manager is to administer employer/employee relationships. In order to perform these tasks, the HR manager must understand his/her role, and constantly review it, so that management can gain a better understanding of what HR is. HR managers are becoming more aware of internal and external changes, and are incorporating a more strategic approach by linking business strategies to HR policies and procedures. Since Cherrie is responsible for all administrative and HR issues, it is important that she develops and maintains a business insight and understands her role as HRM.

She needs to develop a new strategic approach to overcome the changes that are occurring within Natural Knibbles. 3. 2Strategic Partner It is important for the HR manager to be involved in the management team, and have the opportunity to contribute to the organisations’ strategic decisions. HR managers take a more strategic approach by gaining a better understanding of the organisation, the employees, stakeholders, products and finances, helping them fulfil their role by translating business strategy into action. Natural Knibbles will be faced with the challenge of linking business strategies with HR policies and practices.

By integrating the HRM role with the management team, this will allow the HR manager to become a strategic partner of the organisation 3. 3Administrative Expert For an HR manager to create value for the company, he/she must re-engineer HR activities through the use of technology and the re-design of work (Stone, 2008 p9). One way Natural Knibbles can redesign their work practices is by introducing a specially designed Human Resource Information Management System (HRIMS) to assist with any future changes and staff issues.

While HRIMS lead to an efficient and effective workplace, they can be costly as they involve training, on-going development and maintenance (Stone, 2008 p95). 3. 4Employee Champion As an Employee Champion, the HR manager must be able to relate to the employees, and meet their needs (Stone, 2008 p9). In order to fulfil this role, the HR manager must interact with employees and understand any issues or concerns they may have, to become a voice for them by passing on these concerns to management. By doing this, employees will be able to outline their goals and objectives, and ‘perform their jobs successfully’ (Stone, 2008 p10).

Since Cherrie looks after all HR issues, it is important that she becomes a voice for the employees at Natural Knibbles, and addresses any concerns they may have to Brandon. 3. 5Change Agent HRM is constantly changing and developing as new trends and changing environments affect businesses and HR functions. It is important that in these situations, HR managers know how to manage change, and can act as a medium for when change occurs. The purpose of becoming a change agent is to develop and maintain a ‘learning environment, where knowledge, creation, sharing and dissemination are valued’ (Stone, 2008 p11).

Natural Knibbles’ HR manager must be able to manage change and use a diagnostic approach by considering the nature of the external and internal environment so that they can implement a change strategy that will improve the business operations. 3. 6HRM Activities While HRM is responsible for managing employer/employee relationships, it also involves ‘the acquisition, development, reward and motivation, maintenance and departure of an organisation’s human resources’ (Stone, 2008 p11). As an HR manager at Natural Knibbles, Cherrie will be responsible for the following (Stone, 2008 p11, 12) Job Analysis Identifying and defining the abilities, skills, knowledge, qualifications, tasks and responsibilities needed to perform a job successfully. -Human Resource Planning

The process of finding the right number of qualified people in the right jobs at the right time. This helps HR to be more effective and efficient by enhancing employee satisfaction and achieving the organisations strategic objectives. -Recruitment ‘Seeking and attracting a pool of applicants’ for a job by using recruitment methods such as advertising, job posting, recruitment consultants or agents (Stone 2008 p11). Selection Selecting applicants that have the appropriate skills and attributes needed for the position. This process involves reviewing applicants, testing, interviewing, background checks and reference checks. -Performance appraisal Involves reviewing employees’ performance to determine how well they are doing their jobs. -Human Resource Development activities Activities focusing on employee training, to provide the right skills and knowledge required to perform tasks, resulting in increased motivation and job satisfaction. -Career planning and development activities

These activities benefit both the employer and employee by identifying future career opportunities. -Employee motivation Involves motivating employees by providing them with rewards to ensure that they are satisfied with working conditions. -Remuneration Paying employees a sufficient amount of money for the work they put into the organisation. This includes base pay, incentives, bonuses and allowances. -Benefits Relates to non-cash benefits that improve employee job performance, such as superannuation, insurance and leave. 3. 7Organisational Stakeholders

In order to produce an effective HR plan, it is important that the company determines who their stakeholders are, and ensures that their needs are met. Stakeholders all share a common interest in companies, such a Natural Knibbles. Natural Knibbles must ensure that they achieve strategic objectives and to satisfy both internal and external stakeholders. 3. 8Strategic Intent Strategic Intent refers to the ‘sustained obsession to achieve a challenging long-term objective’ (Stone, 2008 p16). Natural Knibbles will be faced with the challenge of developing strategic objectives, as the company is currently facing a number of changes.

Natural Knibbles needs to establish a core HR value that provides a clear statement of the company’s vision. 3. 9Strategic Management Strategic Management is the process of obtaining a competitive advantage over other companies. It ‘establishes an organisations long-term direction and sets specific performance objectives’ (Stone 2008 p16). Natural Knibbles are currently facing a number of changes, which is why it is essential that strategic management decisions are linked to their overall goals and objectives.

Natural Knibbles is about to enter a new market by catering to those with special dietary needs and must make sure that they don’t lose sight of their core business concepts. While the expansion of entering a new market will offer greater opportunities to Natural Knibbles, they are also faced with threats. One challenge that Natural Knibbles will have to focus on is the fast growth in the health-food market. With new trends and larger product lines, this is resulting in increased competition. The competition is beginning to impact on Natural Knibbles’ sales, with a 2% decrease being recorded over the last 2 years.

If this issue is not handled appropriately, then future sales and profitability will continue to decrease. Natural Knibbles needs to establish its strengths, weaknesses, opportunities and threats in both the external and internal environment to ensure that the company maintains its success. 3. 10HR Planning HR Planning involves planning, organising and reviewing human resource activities to ensure that the right people are employed at the right time to help achieve organisational strategic objectives.

Forecasts are made to ensure that the right numbers of people are being used at appropriate times. An example of this would be Natural Knibbles’ seasonal products. It is important that HR managers predict the appropriate amount of people to work during the summer and winter seasons to minimise the number of implications relating to production, sales and staff. One of the main difficulties that Natural Knibbles is having with seasonal products is that it is difficult to satisfy steady demand. Another difficulty is that there is not enough manpower or facilities to store these seasonal products.

Natural Knibbles needs to match the company’s strategic and HR objectives with people requirements and should consider offshoring or outsourcing, rather than hiring seasonal staff. 3. 11Environmental Factors and HR Planning Both internal and external environmental factors play a major role in HR planning. This is because HR planning must reflect environmental trends and issues that affect an organisation The external environment includes political, economic, legal, social, demographic and technological trends involving laws regarding pay, equal employment opportunity, job security, labour skills and shortages, aging population, etc.

Within the business, the company needs to examine the internal environment, involving organisational strategies, culture, structure and systems. Eg: Defining the company’s core values, business and strategic objectives (Stone 2008 p56). 3. 12Globalisation Globalisation is having a major impact on organisations. While it is a more recent environmental factor, it is ‘allowing skilled labour to move like capital across the world to locations that offer the best compensation and the best future’ (Stone 2008 p57). Natural Knibbles are competing against other countries to attract more skilful and knowledgeable employees. . 13Forecasting and Research methods It is important that as a HR manager, analytical problems, such as forecasting and predicting labour trends are applied effectively. In this process, two research methods are used; quantitative and qualitative. Quantitative research is based on the use of mathematical techniques to forecast supply and demand. These methods include projecting trends and econometric modelling and multiple predictive trends (Stone, 2008 p60). Natural Knibbles is currently facing a challenge, and cannot effectively forecast the supply for internal resources.

It is important that they consider using a skills inventory method which analyses skills, knowledge, capabilities of their employees. Another method that can be used includes exit interviews, which determine the reason why employees wish to leave the organisation. 3. 14Outsourcing and Offshoring Outsourcing has both positive and negative effects on Australia’s employment opportunities. Outsourcing can be positive in that it can cost significantly less to outsource operations across international borders (known as offshoring).

Australia outsources to countries such as China, India, Singapore and Malaysia to reduce labour costs, however this decreases the demand for production, manufacturing and IT jobs creating labour shortages. A problem that Natural Knibbles faces is whether they are maintaining their knowledge of the external supply of human resources so that they have the ability to meet the needs of changing labour conditions. 3. 15HRMIS Confidentiality and management concerns ‘HR data is generally confidential and sensitive’ (Stone 2008, p92). Natural Knibbles operates on a very informal basis, with open communication and employees moving to jobs as required.

If Natural Knibbles operates in such an open environment, a key problem that the company’s HR manager needs to adhere to is the invasion of employee privacy by both authorised and unauthorised personnel. To ensure that confidential information of employees and management is secure, HRIMS security is used. Natural Knibbles are focusing on redesign their work practices by introducing a specially designed HRIMS to assist with any future changes and staff issues. While HRIMS lead to an efficient and effective workplace, they can be costly as they involve training, on-going development and maintenance (Stone, 2008 p95). . 16Employment Law Successful HR professionals must be familiar with the legal issues to manage the employer/employee relationship. The HR manager at Natural Knibbles needs to be familiar with the law of employment and industrial laws to minimise the organisation’s exposure to dispute and litigation (Stone, 2008 p112). Written employment contracts exist between employers and employees, as they outline factors relating to pay, duties, supervision, work hours, overtime, benefits, policies and procedures, leave and other confidential information.

The advantage of this is so that both employers and employees understand what is expected of them, and their role within the company (Stone, 2008 p114). Natural Knibbles are constantly moving employees between jobs as and when needed. In order to reduce doubts and disputes between parties as to what employees are and aren’t entitled to, it is important that the HR manager of Natural Knibbles develops fixed term contracts. These contracts outline specific tasks and dates employees commence and end employment. 4. 0Alternative solutions

Natural Knibbles will need to make changes to the problems outlined. To support these changes, alternative solutions have been suggested to assist Brandon and Cherrie. 4. 1Recruitment Process Natural Knibbles have to focus on maintaining efficient production. While the company already has a recruitment process, it is important that this process is improved by analysing each individual based on the requirements of the job. Natural Knibbles needs to ask themselves, who are they employing? Will this benefit the organisation?

What does the prospective employee have to offer? Do they share the same or similar values as the company? Are they qualified? Will training be needed? Is this candidate looking for a long term or short term contract? All of these questions need to be taken into account when hiring new staff members, as Natural Knibbles needs to obtain the most out of their employees to attain strategic objectives. 4. 2Human Resource Information Management Systems To assist with future changes and staff issues, Michael suggested that Natural Knibbles design a customised system.

While a customised system would be good for the company, realistically, it is not affordable and has a number of disadvantages. Natural Knibbles may not have sufficient funds to provide the large upfront cost to use this system. The customised system can be frustrating with cost overruns, programming errors and the inability to complete projects within reasonable timeframes. As a solution, Natural Knibbles could buy an ‘off-the-shelf’ system but work with a vendor to modify it to better satisfy the organisation’s requirements.

The ‘buy and modify’ option is used to get the ‘best of both worlds’ (Stone, 2008 p96). The vendor takes care of the painful and costly development work and modifies the system to suit the organisation’s needs. Since this system often has a large user base, the vendor is motivated to provide ongoing maintenance and, even more importantly, future development (Stone, 2008 p96). 5. 0 Conclusion/Recommendation Natural Knibbles’ success ultimately depends on how well its human resources are managed.

For a successful HR plan, the company must ensure that HR personnel understand the HR planning process, that top management is supportive of these decisions, that the organisations doesn’t over complicate the system, the communication between HR managers and their employees are healthy and that there is a balance between quantitative and qualitative approaches to HR planning. All of these factors have been outlined within the case, and it is important that management not only recognise these factors, but that they also make the right decision for company.

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