Internal Stakeholder Management through SHRM
Contemporary business scenario is much more competitive than it was a few years ago. Thus, organizations operating in the current business scenario have to maintain and consider various aspects or elements in order to gain competitive advantages in the market and effectively operate in the market (Campbell, Coff & Kryscynski, 2012). However, in the current business scenario, another aspect that has been overlooked many times is the effective management of the internal stakeholders. Effective management of the internal stakeholders in the organization is required due to the reason that it will help to enhance the effectiveness and productivity of the employees along with enhancing the competitive advantages for the organizations. Thus, strategic human resource management is being introduced which will help the business organizations in adhering their organizational objectives with the management of the human resources (Truss, Mankin & Kelliher, 2012).
Best buy is one of the leading and prominent electronic retailers in the United States along with their branch in Canada and Mexico (About Best Buy – Best Buy Corporate News and Information, 2017). They have also faced issues related to their employees in the past. However with the help of effective implementation of human resources management theories, they have overcome those issues. This report will discuss about the stakeholders who need to be involved in the process of human resource management along with determining the key environmental factors that may have implications on the internal management of Best buy. In addition, the most effective selection and recruitment approaches will be discussed in this report along with the best policies to retain the performing employees.
The key motive and objective of the human resource management is the welfare of the employees and thus employees are the prime stakeholders for the strategic human resource management (Marchington et al., 2016). Employees is having the interest in enhancing the performance of the organization due to the reason that, the more profitable will be the organization, the more compensation and job security will there for them. On the other hand, if the organization cannot able to survive in the market, then the employees may have to lose their jobs. Thus, they are also having interest in the initiation of the strategic human resource management in the organization. According to the theory of universalistic approach of the best human resource practices in the organization includes employee recruitment, employee training and other motivation and welfare practices (Gallie et al., 2012). According to this theory, implementation of these practices in the organization will help them in having positive outcome regardless of what the situation is. Thus, for Best buy, initiation of this approach will help to enhance their competitive advantages in the market by having trained and motivated employees.
Environmental Factors Impacting SHRM
Upper level management or the senior management in the organization is also having interest in the organization due to the reason that, they are ones who will have major portion of the profits if they can run the organization effectively. In the case of Best buy, senior level management includes the CEO, vice chairman and others. Thus, they will have the direct impact if the organization ran in to loss. Thus, initiation of strategic human resource management will help to align the objectives of the human resource management in the organization with that of the organization goals and objectives. This will make the employee more competitive, which in turn help them to enhance the profitability of the business. In addition, various initiatives of human resource management as discussed in universalistic approach should also be implemented on the senior management. This will help them to enhance their leadership skills and how to effectively manage the employees.
For the contemporary business organizations, customers play an important role in determining the policies of human resource management. This is due to the reason that the current business scenario is based on the taste and preference pattern of the customers and thus it is important for the business organizations to effectively comply the goals and objectives of human resource management with that of the requirement of the market (Wood & Zsuzsanna Kispal-Vitai, 2017). Customers are having interest in the performance of the organization due to the reason that, in the case of Best buy, customers will expect higher quality products in affordable price along with effective customer service. Thus, these can be provided to the customers only when the employees will be properly and effectively trained and equipped.
Investors and shareholders are also having interest in the performance of the organization due to the reason that the more profit the organization will earn, the more will be the return or dividend being received by the shareholders. Best buy trade in the New York stock exchange and thus, they are having good number of shareholders. The objective of these shareholders is to have positive return s from the organization (Lawal, 2012). Thus, in that case, it is required for the organization to effectively drive their internal management along with considering other business aspects. Shareholders also promote investing in human resource management for the employees, in order to enhance their productivity, which will in turn increase the profitability of the organization.
Employee Selection Methods
There are various environmental factors that will have negative as well as positive implications on the policies of strategic human resource management of Best buy. This is due to the reason that, according to the theory of contingency approach of strategic human resource management, it is required for the business organizations to change or modify their policies of strategic human resource management according to the current needs in the market. According to this theory, the situation being faced by the organizations is different from one another and thus following universalistic approach will not have similar outcome for all (Beh & Loo, 2013). In that case, it is important for the organization such as Best buy to design the policies of strategic human resource management according to the organizational requirement. The following sections will discuss about the various environmental factors that will have implications on Best buy.
As discussed earlier, the socio-cultural trend in the current market scenario is rapidly changing and thus it is of urgent requirement for the business organization such as Best buy to cope up with changing trend in the market (Schaltegger & Wagner, 2017). One of the determining factors that will have implications on Best buy will be the changing need and requirement of the employees. With the change in the socio-cultural environment, the requirement for the employees is also changing. Thus, policies of strategic human resource management of Best buy should comply with the change in the employee requirement to have the optimal effectiveness (D’Arcy, Herath & Shoss, 2014). Otherwise, the implementation of the strategic human resource management will not have desired outcome in the organization.
Technology is rapidly changing and evolving in the current business scenario and thus it is also important for the business organization to include technologies in the initiation of the policies of strategic human resource management (Baker, 2012). In the case of Best buy, inclusion of newer and updated technologies in providing customer service and enhancing the customer convenience will help them to increase their market share. However, for that, they have to train their employees regarding the use of the particular technologies. Thus, in the current business scenario, if the organizations do not involve technologies in designing the plan for strategic human resource management, then the desired outcome will not be achieved (Schwalbe, 2015). Moreover, Best buy mostly operates in the developed regions of United States, Canada and Mexico. Thus, inclusion of update technologies and in accordance providing training to the employees is important for them. This is one of the key factors that will have implication on the effectiveness of the strategic human resource management policies being involved by Best buy.
Conclusion
Legal environment is also one of the key determining factors that will have implications on the effectiveness of strategic human resource management of Best buy. Various regulations and legislations are being introduced by the government regarding the management of the employees (Bagley, 2015). Thus is important for Best buy to effectively adhere with the legislations in order to prevent any legal issues. Legislations regarding the diversity in the workforce, gender equality and employee welfare activities should be effectively maintained by them with the help of strategic human resource management (Barak, 2016).
Selecting the right employees for the right job is one of the key elements that is required for the effective human resource management in the organization (Armstrong & Taylor, 2014). With the initiation of strategic human resource management, it is required to adhere the goals of the human resource management with the organizational goals. Thus, selecting right employees is required who will effectively achieve the organizational goals. There are several methods of selecting right employees. However, this report will only talk about the three most effective methods of selecting of employees. In addition, as discussed earlier, according to the contingency theory, if the right candidate can be selected for the organization, then coping up with the change in the current scenario will be easier due to the fact that the new employees will be more comfortable with the latest change in the social scenario (Kroll, 2015).
Interview process is the one of the most effective and widely used process of selection of new employees. Interview process will help in selecting right candidate for the right job due to the fact that it will help the interviewer in having face to face chat with the candidates (Kumari, 2012). Thus, due to the involvement of the physical presence of both the parties, both the interviewer and the candidate will be able to interact with each other. It will help the interviewer in determine the qualities of the candidate, which is required for the organization (Cohen, 2013). On the other hand, it will also help the candidates to communicate with the interviewer about the job profile and the organization. It will help the candidates to determine the organizational culture and behavior that he will require in his new workplace. In the case of Best buy, interview process will help the organization to communicate with the potential candidates about the criterions and requirements of the organization and identifying the personal traits of the candidates. Interacting with the candidates face to face will help them to determine whether the candidates are comfortable in flexible work, which is being practiced in Best buy.
There are various limitations have also been identified in the interview process. One of the key limitations is the introvert nature of the candidates, who hesitates to communicate with the interviewers effectively even though they have the required qualification. Thus, psychological testing can be used to identify the qualities of the candidates. It includes ability test, attainment test, aptitude test, personality test and intelligence test. The score is being compared with the benchmark and required marks required for the organization (Kline, 2013). This will help the candidates to demonstrate their qualities effectively. On the other hand, it also helps the organization to determine the qualities required for them from the candidates. In this case, the candidates will not feel uncomfortable and shy in communicating with the interviewers and thus, the accurate determination of the employee qualities can be initiated.
Organizations such as Best buy is having dynamic and rapidly changing working environment, which may not be possible for the human resource managers to provide to the candidates. Thus, it becomes difficult for them to determine that whether the selected candidate can work on the practical situation. Thus in order to provide real situation and working condition, a simulation process is being initiated (Moses & Byham, 2013). Assessment centers will have the simulated working condition similar to the organizational requirement and accordingly candidates are being given tasks to determine their effectiveness. Thus, it will help the organization to determine that whether the candidate is eligible for the job post or not. This process is the most effective process of determining the eligibility of the candidates, while other methods are mostly rely on the theoretical knowledge of the candidates, this process mainly depends on the implementation capability of the candidates.
Rewarding the employees is one of the key measures being initiated by the business organizations in order to motivate the employees in their workplace and retaining the key performing employees (Shields et al., 2015). It is important for the business organizations to retain the good performing employees due to the fact that they are the main source of revenue. Strategic reward system is being initiated in order to implement a long term plan of retention and motivating the employees. It includes various approaches. The following sections will discuss about the various approaches of strategic reward.
Enhancing the workplace environment and adding more flexibility in the job also helps in retaining the employees. This is due to the reason that, employees continuously giving good performances will have the expectation that they will be given more responsibilities and freedom in decision making in the organization. Absence of these elements will make them to think about changing the job (Shields et al., 2015). Thus, organization has to provide them job enrichments, promotion and more freedom in the workplace. This will help the employees to have more satisfaction level with their workplace. This will in turn reduce the chance of switching jobs.
Majority of the employees expects financial benefits as reward from the organization. Thus, Best buy can provide perquisites, extra allowances, bonuses and increments to their employees (Hofmans, De Gieter & Pepermans, 2013). Financial benefits will have the most effective impact on the employees and if they are given proper and timely monetary increments, then they will not opt for change of job. Thus, it is important for the business organization to provide financial benefits to their employees according to the industry standards. It will in turn motivate the employees to perform better.
Employee recognition in the workplace is another approach of rewarding the employees. Apart from the financial aspects, employees also expect that they will be recognized by the organization due to their performance. Thus, organizing seminars and rewarding the performing employees by recognizing their contribution in front of all stakeholders will have huge impact. Employees being recognized in the organization for their performance will less likely opt for job change. Thus, this can be another effective strategy to retain the performing employees.
Conclusion
Thus, it can be concluded that, initiation of the flexible working culture by Best buy will help to motivate their employees and will also enable them to have the high level of retention ratio. This report discussed about the various stakeholders those will have interest in the organizational performance. The importance of strategic human resource management for all the stakeholders has also been discussed. In addition, the influencing factors in strategic human resource management have also been discussed. Other elements of strategic human resource management such as effective selection methods and strategic reward approaches are also being discussed. This report concludes that initiation of the strategic human resource management will help Best buy to enhance their organizational productivity and effectiveness by effectively managing the internal stakeholders.
Reference
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