Solving Problems In Small And Medium-Sized Finance Sector In Pakistan: A Case Study Of Uzair Hammad Faisal & Co

Background and Problem Identification

In order to succeed in a business environment, it is important for organisations to take decisions that highlight some of the important aspects of a company (Beardwell & Thompson, 2014). The report focuses on the managerial decisions taken by Uzair Hammad Faisal & co (UHF) located in Pakistan. The main problem that the report focuses on is the lack of teamwork and increase in turnover of the employees. The manners in which the employees are paid in financial sectors of Pakistan are also low and as a result, most employees seek employment in other industrial sectors. The report analyses this issue and the manner in which these decisions are made by the company to mitigate these issues. The objective of the report is to find out relevant solutions that can be incorporated in UHF in order to maintain a proper work environment.

UHF is a small and medium-sized sector located in Lahore, Pakistan. The company is known for performing statutory audits for other companies with regard to the Companies Ordinance, 1984. Some of the services offered by UHF include the managing audits, advising for assessing business risk, ERP implementation and so on. The report highlights the problems faced by the companies and the manner in which the company can overcome it.

1. Problem background and problem identification

The problem that has been identified is related to the financial sector in Pakistan. It is seen that the basic problems of human resource management have been the major issues that exist in the firms. These problems include lack of the solution for solving team-related issues, high rate of employee turnover and the salaries that are provided to the employees.  The problems arise in the Small and Medium Finance Sector in Pakistan, which is run by Chartered Accountants (CA). It is seen that the make the employees work for low wages and pay them only a limited stipend for training. The length of training for CAs in Pakistan is about 3.5 years.

Thus, due to these reasons, most people consider a switch from the financial sector to other sectors in the business environment. The fact that after being permanent in the organisations, employees are paid a low salary is another negative factor for the organisations in the country. The aim of UHF, like other Accounting Firms in Pakistan, is to maximise profits rather than improving the value and retention of the staffs. The situation can also affect the stakeholders of the company. The stakeholders of UHF are the employees that work in the firms. This negative impact can be easily identified, as the employees tend to move out of the sector. Hence, based on the identification of the problems a 5W framework can be drawn to summarise the situation

Table 1: 5W Framework

(Created by author)

2. Solution generation

As stated by Nancarrow et al., (2013) in order to be effective the business market, every manager needs to ensure that proper technique so that problems arising in business can be solved in a proper manner. In the case of the problems that have occurred in UHF in Pakistan, it can be said that the managers of the company need to apply relevant managerial tactics in order to overcome the problems. The techniques that can be adopted by the Partners for each problem are provided below:

Solution Generation

Team building: Tims et al., (2013) are of the opinion that in order to ensure that team building is conducted in an effective manner, the application of Belbin’s team roles and Tuckman’s team model can be used. These models help in identifying the roles that every member of a team needs to be played so that the team members can be sorted out as per their skills. The fact that at an initial stage the team members do not respond well to one another is a huge problem for most organisations.

Costa, Passos & Bakker (2014) stated that a team is as good as the leader. Thus, it is the duty of the team leaders to ensure that the team members are managed with the application of either of team development models. The basic responsibility, however, is to understand the problems that lie within the team. In the case of UHF, the team members lacked a proper leader that could hear and solve their problems in an effective manner. The firm can organise brainstorming session in order to generate ideas that may be relevant or irrelevant (Costa, Passos & Bakker, 2015). This can help in building up a strong bond between the team members.

Employee turnover: According to Galegher, Kraut and Egido (2014), employee turnover in organisations are caused due to the lack of proper motivation for the employees. Every employee needs to be motivated in order to ensure that the loyalty and efficiency of the employees are maintained. This can be done by applying motivation techniques such as that Maslow’s hierarchy and Herzberg’s two-factor theories. Both these theories are quite similar to one another and aim at the satisfaction of the employees by fulfilling their needs (Elliot, Dweck & Yeager, 2017).

Hence, the application of these theories can help UHF to retain the employees. The employee turnover is because the employees are not motivated to continue in the organisations. The motivational factor that needs to be provided in this case is the job security of the employees. The employees in the financial sector need a job that provides them with a decent salary so that they can earn a proper livelihood. Thus, this is an important form of technique that needs to be applied by the organisations in the financial sector.

Salaries: According to Nuttin (2014), a good pay grade is essential for the employees to work in an efficient manner in an organisation. It is seen that most employees prefer to work in organisations for a healthy salary that justifies the time and effort provided in the jobs. This helps them to remain motivated and they provide their best efforts while performing work. Thus, salary or monetary benefits can be considered as a huge source of inspiration for people working in organisations.

Mullan et al., (2015) stated that in order to provide a good salary to the employees, it is important that the managers base the salaries according to the experience of the employees and the amount of work done by the employees. This can help the managers to understand the value of the employees and can motivate employees to perform better in the organisations. In the case of UHF, the partners need to ensure that the salaries are paid to the employees based on the work done. The minimum salary based on industrial standard need to be paid so that the employees can fulfil the basic needs.

Solution Evaluation

3. Solution evaluation

After the analysis of the problems and providing solutions, the evaluation of the same can be done by using techniques. It can be said that in order to mitigate the solutions it is important that every organisation working in UHF follow a systematic approach towards managing employees. One of the basic things that the company needs to do is ensure that the profit-making activity of the company does not remain the sole focus. This can help in focusing on the needs of the employees, as it is important to motivate and recognise the skills of the employees in order to attain success in the organisations (Weinstein, 2014).

The success of companies can be evaluated with the application of certain techniques such as the affinity diagram. According to Hancock et al., (2013), an affinity diagram consists of the solutions that are provided as a group that is presented in an unstructured manner. This one of the best methods by which suitable solutions can be identified may help in creating divergent thoughts for a manager. In the case of UHF, the affinity diagram can be drawn based on the solutions generated for each issue.

The affinity diagram provides an analysis of the methods that need to be followed by the managers of UHF. This can help the company to remain different from the other companies in the sectors. It can be seen that the motivation factor is important in order to retain the employees. Motivating an employee can be done with the restructuring of the salary provided by the company.

The fact that the teamwork between the employees is low is due to the lack of motivation among the employees. As stated by Maslow (2013), every employee needs to follow a systematic process in order to work efficiently in an organisation. One of the basic problems that are faced in UHF is the fact that the Partners of the firm aim at gaining profits without taking care of the employees. They also remain biased while providing salaries to the employees. Thus, an unbiased approach needs to be undertaken in order to reduce employee turnover.

4. Implementation and action plan

After analysing the affinity diagram and recognising the changes required in UHF, it can be said that the need is to implement the technique in the organisation. It can be said that in order to implement the changes, the force field analysis can be applied. According to Stanley et al., (2013), the force field analysis provides an opportunity to look at the factors that influence a situation at the initial stage. It identifies forces that help an organisation to achieve its goals or hinder an organisation from achieving the goals. In the case of UHF, the force field analysis can be used to identify the driving force and restraining force.

After the analysis of the model, it can be said that the restraining force for UHF is the high training cost, profit-making mentality and the lack of a proper leader. According to Armstrong & Taylor (2014), these three are the most important factors that every organisation needs to maintain in order to gain success. The success factor of UHF needs to come with the driving force that is needed for the organisation. The proper payment of salary and improvement in teamwork are the necessary driving force that is applied in the organisation. The analysis highlights the need to improve the driving forces in the organisation. In order to implement the driving forces in UHF, an action plan can be developed that highlights the manner in which this changes can be implemented.

Team Building

 Table 2: Action plan

(Created by author)

Conclusion

Thus, it can be concluded that in order to maintain the proper satisfaction of the employees, organisations need to employ different tactics that can help in ensuring its success. The situation in the Accounting Firms in Pakistan has serious problems that lead to the failure of the organisations to retain employees and enhance the growth of the sector. In this regard, the application of proper tactics addressing each issue needs to be highlighted and implemented in a proper manner. For a company like UHF, the need for implementing the changes is important for the company to gain success. The driving forces behind the change need to be implemented in such a manner so that the employees get motivated to continue to work in the sectors. On the other hand, it is also the responsibility of the managers to force these changes on the organisation.  

Reference

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Costa, P., Passos, A. M., & Bakker, A. (2014). Empirical validation of the team work engagement construct. Journal of Personnel Psychology.

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Galegher, J., Kraut, R. E., & Egido, C. (2014). Intellectual teamwork: Social and technological foundations of cooperative work. Psychology Press.

Hancock, J. I., Allen, D. G., Bosco, F. A., McDaniel, K. R., & Pierce, C. A. (2013). Meta-analytic review of employee turnover as a predictor of firm performance. Journal of Management, 39(3), 573-603.

Hom, P. W., Lee, T. W., Shaw, J. D., & Hausknecht, J. P. (2017). One hundred years of employee turnover theory and research.

Maslow, A. H. (2013). A theory of human motivation. Simon and Schuster.

Mullan, B., Norman, P., Boer, H., & Seydel, E. (2015). Protection motivation theory. In Predicting and changing health behaviour: Research and practice with social cognition models (pp. x-x). Open University Press.

Nancarrow, S. A., Booth, A., Ariss, S., Smith, T., Enderby, P., & Roots, A. (2013). Ten principles of good interdisciplinary team work. Human resources for Health, 11(1), 19.

Nuttin, J. (2014). Future time perspective and motivation: Theory and research method. Psychology Press.

Stanley, L., Vandenberghe, C., Vandenberg, R., & Bentein, K. (2013). Commitment profiles and employee turnover. Journal of Vocational Behavior, 82(3), 176-187.

Tims, M., Bakker, A. B., Derks, D., & van Rhenen, W. (2013). Job crafting at the team and individual level: Implications for work engagement and performance. Group & Organization Management, 38(4), 427-454.

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