Entrepreneurship Business & Economics – Wesfarmers Limited

Models and Frameworks

Discuss About The Entrepreneurship Business And Economics.

Wesfarmers Limited is an Australian conglomerate dealing in chemical, fertilizers, coal mining and industrial and safety products. The company is earning the highest revenues by using its resources. Wesfarmers is the largest private player in Australia and has around 220000 employees (Wesfarmers, 2017a). Wesfarmers is found in 1914 as a cooperative to provide services and merchandise to the Western Australian farmers. The company was listed on the Australian Securities Exchange and grew into the large retail conglomerate. The competitors of Wesfarmers are Woolworths, Tesco, and Kroger and sprouts farmers market (Wesfarmers, 2017b).

Wesfarmers is a type of public company and has a composition of the board of directors which includes 9 directors including the eight non-executive directors in the company. The directors of the company have sufficient skills, expertise, and experience to enable the company to grow and develop more in the future and can sustain for the long period of time. The company has earned more than $3 billion (approx.) in the year 2017. The company has a different human resource department to the employee only these resources which qualify the requirement of the company criteria. Wesfarmers are particularly choosing their employees with caution to have a strong workforce base in the organization (Business News, 2018).

Strategic HRM can be defined as the process of defining how the organization can be achieved its goal by using the human resources. The human resource using means that using the HR strategies and integrated HR policies and practices.

Strategic Management- Strategic Role of HR

The Strategic Role of HR includes the seven steps to being strategic are as follows:

The first step includes the awareness of business concepts and its deals. Setting the strategic direction is the primary duty of the board of directors. Setting the direction at the higher level of articulation where the business vision is cast. The second step deals with understanding the business in which the company is working. In this step, the top level management creates the strategic plan and make sure that it will be simple to implement (Heijkant, 2015).

The third step deals in the how the HR can add value to the organization by recruiting and selecting the skilled labour force. The company should appreciate the efforts made by the HR. The finalization of the agreement between the board and professional staff is done and plan should be simple enough so that every employee can able to understand it.  The fourth step is to talk about seeing the big picture of the business. In this step, the business can explore to which fields are judged by the company representatives. The company expansion strategy and capacity is judged in this. In this step, the operational plan has been formed and implement in the organization. It is the stage where the tactics are defined and accountability is established (Beer, Boselie and Brewster, 2015).

Model of Strategic HRM

The fifth step is related to the act as a changing agent in the company. In this the company tries to find out the person who actually work for the company; use their innovative skills and knowledge in the implementation of new activities. For the same, the board has been updated about the plan and new innovative ideas. The sixth step deals in making the convincing business so that each and every person who gets affected with the business gets influenced by the business proposal. These persons include the internal peoples like employees and external people includes the shareholders, suppliers, customers, the person who are looking for the job etc. the operational plans gets converted into the departmental plans. This leads to the division of the work which brings specialization in the business (Mulder, 2015).

The Seventh step of being strategic refers to the practice evidence which is based on the management. The practices adopted by the management are discussed in this. These practices are related to the planning, organizing, leading and controlling all the organization work in an effective and efficient manner. The past year performance and practices of the company have been judged here (Wesfarmers Chemicals, Energy, and fertilizers, 2016).

The HR strategic overall areas relate to the performance of the employees. The engagement in companies work and implementation are the area where strategy is used. The innovation of new ideas in the business leads to having the competitive advantage in the market from its competitors (Jamali, Dirani and Harwood, 2015). HRM strategies are the tactics that main to the implementing the different purposes in the human resource department of an organization. These strategies are directed by the overall strategies and specific strategies of the business. These strategies are made to serve and help the business in the achievement of the long-term aims via its staff. These strategies are divided into four key areas.  

Talent

Talent can be defined as the capability of the organization which will require for the present as well as for the future by Wesfarmers.  The talent is considered to be the essential asset that the business should strive to maintain all of its life (Kultalahti and Viitala, 2015).

It is the responsibility of the human resource department to find these talents in the organization and this can be done by recruiting and selecting and keeping the best-talented employees. Wesfarmers in the world considered to be the best Human resource department as the technologies innovation done in the company is not matching with the other companies (Shahidifar, 2016).

HR strategies – overall / specific

Leadership

Leadership in the strategy of HR is considered to be as the head of the body. The leadership leads the business to the success and failures. The HRM department plays an important role in the leadership of Wesfarmers because it tasked with getting the best executives to manage the business in the right direction. The HR department of Wesfarmers is doing this leadership within the organization. They do not require outsourcing of the human resource to lead the organization. In order to the job effectively and efficiently, HR team of Wesfarmers is working as proactive in an advice-giving capacity when engaging with the other leaders so to give the input on what is best for the future of the company. In Wesfarmers, the leadership has been changed by the chief Executive Ward. He said that the members are valued high as they have the team with good leadership so it should remain in Wesfarmers culture always (Adamides and Tsinopoulos, 2015).

Planning

Planning can be defined as deciding in advance how many human resources are needed in the organization, who will recruit them, what level of talent and skills are required and whom will select the new peoples in the organization. Planning bridges the gap between where the organization is standing today and where Wesfarmers want to reach and achieve the target. In the planning step, the requirement of the workforce will be calculated by Wesfarmers that how many employees are needed in the upcoming future (Wesfarmers Industrial and safety, 2013).

There is need to hire the number of middle levels and senior level managers in the company as  Wesfarmers is a huge company in which there is always need for more and more people. The expansion done by the company is so high that it will encourage the company to employ more and more personal. Wesfarmers has its own HR department in the company, so the company need not outsource the employee. The HR department will hire according to their own specification and requirements (Wesfarmers, 2017c).

HRM plays an important role in the development of the good culture in the organization. The HR department helps in the implementation of good corporate culture in the organization. There is a need to hire the junior and senior level managers in the organization as these are the person who will form the hierarchy in the organizational structure of Wesfarmers. Managers and HR department develop the definite performance measurement, regular performance evaluation and scheme to incentives and return to the employees for the high performance and creativity in completing their task. Wes farmer’s employees are feel valued by the companies and receive the credit of the accomplishments in the work (Chron, 2018).

Talent

There is no fixed optimal ratio in deciding the hiring the number of people. It totally depends on the work performance required in the organization. But companies like Wesfarmers require more of junior level manager as the work of chemicals; fertilizers are done by the workers. And the workers are handled by the junior level managers only. In the company, there is common measure is followed in selecting the number and level of employees. Senior level managers can have the span of control over the more of junior level managers (Wesfarmers, 2017d).  There are three approaches to the overall strategies which include the high-performance management, high-involvement management and the high-commitment management.  

Strategic Choice refers to the decisions related to the staffing and assortment of the staffs. In this decision, the employees are recruited inside the organisation or outsourced from other is decided by the level of managers. The recruitment will depend on the type and nature of the organisation. Like Wesfarmers, technology updated employees are needed in the organisation an special skills are also required. Wesfarmers prefer to have the special and customised type of recruitment in its organisation, so no outsourcing of employees is done. The budget for making the process of recruitment is approved by the top level heads.

Strategic Analysis

Strategic Analysis is analysing the strength, weakness, opportunities and threats which are related to the human resource department. Strategic analysis is done to achieve the highest results from the introducing the new product or resource in the market. This analysis is focussed on the getting the end result and in Wesfarmers the results are getting qualified and skilled workforce in the organization. The strategic analysis includes three things which are used for the basic purpose and special purpose. Strategic analysis is useful in introducing the new candidates in the organisation while considering all the internal and external factors affecting the decision related to the selection of the employees.

In this model, the HR can be defined as what it does, or by what the HR will deliver. HR can perform 4 different roles in the organization.

(Source: Buller and McEvoy, 2012)

Strategic partner

HR department of the company is responsible for the maintaining the organizational structure in the organization. Human Resource department of the Wesfarmers are adding value to their team by performing better work and hiring quality staff for the company. (Taylor, 2006).

Administrative Expert

Leadership

The HR is responsible to make ensure that all the work should be done in the effective and efficient manner in the organization. All the operation in Wesfarmers is done with streamline and automate most of the operations (Mügge, 2016).

Change Agent

The change agent in the organization helps the HR team of Wesfarmers adapt the changes that are done in the external environment. It will help the company to have the good profit margins from the change. These changing agents are working as the helping plan for and overcome the resistance to the change (Armstrong, Landers and Collmus, 2016).

Employee Champion

The employee champion is like the change agent only. HR is responsible for the inspiring, encouraging for and demonstrating the employees. Working with HR and train the line managers to achieve the desired objectives (Wrench, 2016).

The Harvard model recognizes the existence of the stakeholders within the organization. These stakeholders include the shareholders, customers, suppliers, employees, government and the community at large. This is because this model focuses on the employees as like the shareholders and this model is suitable in Wesfarmers, as the company is very concerned about its staff and employees. The factors include in this model includes:

HR strategy

The HR strategy includes the reward system used in Wesfarmers. The reward is given un the company according to the work performed by the employees. The work system and culture followed in the Wesfarmers motivates the employees to work more and enhance the skill of individual working there. Wesfarmers has more influence of employees in the organization. The open system of communication is used in the organization so that the flows of information can be done easily (Marchington, 2015).

HR outcomes

Human resources are responsible for giving the results and output in the organization. In this strategy, Wesfarmers expects the employees to give the commitments to work to the best possibility. The commitment related to achievement of organizational goal and minimum wastage of resources should be there. This will make the employees to remain competitive in nature and can achieve the better goals (Kaufman, 2015).

Long-term Consequences

Every organization needs to survive and maintain its position in the market. Wesfarmers also try to maintain its position in the market by using the various strategies and its resources. Every organization can have the same financial resources and other resources but no two organizations can have the same human resource. Wesfarmers is using this concept and uses its human effectively and efficiently to have the competitive edge in the market. Wesfarmers is providing the services in such a manner that it will be beneficial for the company as well as to its employees by providing the adequate incentives schemes to its employees.

Planning

Situational Interest

In the situational interest, the company identifies the type of workforce the company, whether the company is having the skilled workforce or it is unskilled. The qualification of the employees are working in the organization are checked. Like Wesfarmers, the company has both type of workforce, skilled as well as unskilled, knowledgeable, innovators etc. the policies and decision in the organization remade on this basis. The business strategy also depends on the type and numbers of employees working in the organization (Cook, 2016).

The situational factors of Wesfarmers are also considered the legal and societal factors affecting the values of the environment. The company is working in the technological development environment so the regular updating in the machines and development of worker is the requirement of the situational factors (Bryson, 2018).

Stakeholders Interest

The stakeholders include the suppliers, customers, government, shareholders of the company. All these persons get affected by the decision taken by Wesfarmers. The company takes all the decision while taking into consideration the interest of all the individuals (Jeske and Shultz, 2016).

Conclusion 

From the above discussion, it can be concluded that Wesfarmers gives more importance to the human resource department in the organization. The company relies on having the best human resource in the organization so that company has a competitive advantage in the market. The company has a large number of employee base; around 220000 employees are working in Wesfarmers. To have the better understanding of the organizational structure of Wesfarmers, report highlight on the matter that how many workforces are required and in which level of management. In company more of the junior level managers are required as compared to the senior level managers. For maintaining the workforce needs and requirements in the business, the company is using the various models and frameworks for the same. These models and frameworks include Model of Strategic HRM, Harvard Model of Human Resource Management, Ulrich’s Model of human resource management etc. to know the organization structure and policies opted by the company to have more understanding of the employees. This model relates the organization to give more importance to the human resource of the organization and give the incentives, rewards and other benefits to the employees. The employees in Wesfarmers are treated with equality and no discrimination in male and female are adopted in the organization.

References

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Performance Culture

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