I will be looking at the way Safeway’s Human resources management is run, Safeway is one of the leading grocery retailers in the UK with annual sales of around ï¿½9 billion, 90,000 employees and nearly 480 stores nationwide. Their stores attract around 8 million shoppers every week. Originally they were a US owned company called Safeway Food Stores Ltd. Their first UK store was opened in Bedford in 1962. Over the next two decades the company’s portfolio of stores rose to 133, establishing it as a serious player in the booming UK food retailing market. This success reflects the radical changes they have made in the way they do business and their strategy is based on four key objectives which is focus on product and price, best at fresh, best at availability and best at customer service
Argyll was formed in 1977 by James Gulliver and named after his Scottish birthplace,
the company grew rapidly through acquisition, and during the 80s Argyll focused its retailing operation on the Presto brand while also operating a range of other food and drinks businesses. By 1987, Argyll had the necessary financial muscle to make a bid for the Safeway name and estate. In February 1987 Argyll bought the UK arm of Safeway for ï¿½681m and with it came a distribution network and the ‘Safeway’ name, a programme was launched to integrate the best systems and processes from each company and convert many of the larger Presto stores to the Safeway fascia. As its food retailing operations became more important, Argyll began to sell its non-core businesses and invested in a massive store opening programme. In 1996 the company name was changed to Safeway plc and all stores reframed under the Safeway identity.
Their human resources support management in recruitment, induction and training. HR policies on terms and conditions of pay and benefits, performance management, training and career development apply to all Safeway people. It believes that by building sustainable advantage over our competitors it can only be done through Safeway people. We are creating a business culture in which our people are passionate about our products, our stores and everything we do. If their employees have an unbreakable will to compete and have the skills, knowledge and resources to do their best every day.
The Human Resources operation within Safeway affects all departments and impacts on all members of staff. Human Resources Managers are responsible for attracting, developing and retaining people who are great assets to the stores. They provide expert advice on a range of employee issues and work to help people achieve their full potential.
Their HR strategy has been broadened to ensure they prepare both their business and people for the future and will continue to develop managers in the key areas needed to support this phase, e.g. change. Leadership will be a requisite skill to support their people and managers will receive ongoing development in this area.
Safeway’s entire Supply and HR Divisions recently became Investors in People accredited. In the case of the Supply Division this achievement was unique as they employ both permanent employees and contractors at third party depots.
Human Resources Planning
The function of human resources within a business is considered to be one of very important elements in running private and public enterprises besides the financial capital. It envisages manpower planning which focus on the various ways of attracting sufficient candidates with the right qualifications.
Broadly speaking, the role of human resources include among others manpower planning, recruitment and selection, training and development and performance of management so that a business can have the best people for jobs who are able to perform their respective tasks to the highest level possible. Other responsibilities also include designing jobs that are interesting, keeping within the law on issues such as health & safety, equal opportunities, sex & race discrimination and termination of employment. Another responsibility also include dealing with trade unions, staff association, disputes, industrial tribunals and other legal actions, also ensuring that organisational structures and procedures allow employees to express their views, ideas, complaints and worries.
If a business is expected to be effective and efficient it needs to manage its employees or human resources well. If workers are well managed they will be happier, better motivated, more responsive and more productive. Badly managed employees are more likely to be less enthusiastic, less willing to show initiative and likely to miss work. and finally less productive.
The external labour market is also considered to be a very important factor when dealing with human resources. It is made up of potential employees whether they are locally, regionally or nationally that may have the skills and experience required for a particular business. Manpower planning should cover the analysis of both internal staffing resources, and the monitoring of the availability of labour from external resources. If a business fails to analyse the pool of recruits within the working population both local & national then it runs the risk of not being able to satisfy any additional manpower requirements from external sources. There are many different factors that affect the size and nature of the labour market.
The Labour market is defined as the combination of labour demand and labour supply. Labour demand refers to the total number of workers or even working hours required by employers and is usually measured by the number of jobs plus vacancies. Labour supply refers to the total numbers of hours that labour is willing and able to supply at a given wage rate. It can also be defined as the number or workers willing and able to work in a given occupation or industry for a given wage.
National Labour Market
A business must consider its ability to meet its manpower requirements so that it can operates efficiently and at the same obtain profit or at least cover its running costs in the short run. Overall a national labour market is influenced by the following factors:
* Trends in the size of the working population.
* Competition for labour within businesses industry.
* Overall level of economic activity.
* Education and training opportunities.
* The effect of government legislation.
A national external source also has to be considered, these include national policies, demographics trends and developments which can affect the ability of a business to recruit certain types of labour. Similarly all these factors can have an implication of salary levels and the conditions of employment. We can easily say that manpower planning must also take into account the following factors:
* Economic trends which will affect the demands for different types of labour e.g. in today’s environment there is a greater demand for people with technology skills.
* National demographic trends may have particular implications for the growth of the working population.
* Education and training trends which change the structure and emphasis of university courses and the provision of technical and vocational education in schools and colleges.
* New legislation including government policies and European Union directives on wage and salary negotiations, the role of staff associations and trade unions, equal pay, sex discrimination, employment protection, working time and industrial relations.
Local Labour Market
Business needs to be aware of the labour supply in the location they are operating, they need to know about future and current supply trends. In order for a business to gain a clear understanding of the local supply conditions they must have access to such statistics. Other information can be obtained by local employment offices and job centres which have details of unemployment figures for their particular area, local employers also want information on local wage rates and income levels in order for them to pitch an appropriate wage level to recruit or attract the right sort of employees. The types of information a business needs to know about local employment trends are the following:
* Local employment gives an indication of the general availability of labour and state how easy or difficult it will be to recruit.
* Local Skills shortage, there are job roles that go into decline because the skills required for certain jobs are becoming redundant.
* Competition for employees, it is in a business best interest to know whether its competitors are expanding.
* Availability of labour.
Local external sources have to be looked over when assessing future manpower requirements and how it can be satisfied by local labour markets and manpower planning should take into account the following:
* Developments in the local transport system that determine the effective catchments for labour area.
* Demographic trends paying particular attention on the overall size and age structure of the local working population, e.g. if there a lot of graduates in the area they might consider recruiting them.
* Housing and the availability of different types of accommodation.
* Environmental developments that influence the attractiveness of the area as a place in which to live, more homes and people.
* The local effect of any changes in the governments regional and urban development policies, e.g. if a new retail park opens, there will be more jobs.
* Unemployment rates and the availability of workers with particular skills, qualifications and experience for example higher labour market available for work & higher demand for certain jobs then wages get higher.
* The availability of part time and casual labour, e.g. students and mothers.
* The quality of local education and training providers, people will be more skilled which means higher wages.
* Local competition for labour and its impact on pay rates and fringe benefits e.g. one company might look at what benefits another company offers.
Manpower planning and internal staffing resources
The purpose of manpower planning within different organisations will vary and it is important to identify this purpose – i.e. why your organisation needs to do manpower planning. Once the purpose is clear, then it is important to develop a consistent approach to meet these needs. Manpower Planning is the process by which an organisation determines its human resource management needs and issues, and develops and implements plans to address them, it also gives a clear picture of the supply of labour available to a business internally for example skills, attributes and the potential of the current employees.
At this level the manpower planning function deals with understanding the staffing requirements necessary to implement the organisation’s overall plans. The focus here is on the wider implications of the organisation’s manpower plans in terms of, for example, skill mix and development programme requirements, as they affect the organisation as a whole. Manpower planning at an operational level deals with specific programmes defined as necessary by management to meet their objectives.
Research and experience shows that workforce planning fails when it is applied in a manner which is inconsistent with the needs of the organisation. If it is viewed as too complicated, lacking serious senior management support or focused on issues which are not important to the organisation’s success, it may be perceived as just another “personnel procedure”. However, when it involves managers in meaningful and significant ways, when it provides useful information and stimulates effective decision making and when it addresses important issues before they become expensive problems, then workforce planning is seen as a valuable process of management. This should be based on a manpower inventory consisting of computerised personnel records on each employee which cover the following:
* Age, gender and martial status.
* Date employment commenced, the first day of their work.
* How the employee first heard of the vacancy with the business, whether it was recommended.
* Job title.
* Department, section and job location.
* Employment status (hourly, full-time, part time, shift).
* Previous job titles within the organisation, whether they were once a checkout assistant and now a manager, we know that skills are there.
* Previous work experience with other employees.
* Performance and attainment, their ability.
* Training and development, what type of training they have and if they need more strengths.
* Potential for transfer or promotion.
Information from manpower planning can be analysed to help determine the resources that an organisation possess, and also identify important trends that may have implications for its future labour requirements. This plan should include records of employees that are no longer within the business and the reasons why these employees left for example if it was the company’s fault or employee personal reasons. It gives an opportunity for measuring and analysing:
Labour Turnover – Labour turnover occurs when workers leave an organisation and need to be replaced by new recruits. The main reasons that workers leave are:
ï¿½ Resignation (both voluntary and due to incapacity – pregnancy, ill-health, etc)
ï¿½ Dismissal (including redundancy).
It is calculated in percentage terms using the following formula:
Labour turnover = number of employees leaving over specific period x 100
Average number of people employed
A labour turnover ratio of 25% is generally considered acceptable, however when the rate reaches 30% or more, an organisation will need to pay attention to this particular area. High labour turnover can be expensive, although the actual costs are difficult to estimate. To get some indication, organisations can start by adding up the most obvious expenses – those of advertising, recruitment and training, together with the cost of associated management and supervisory time. The annual total could well convince the organisation that time and effort spent reducing labour turnover is cost-effective. Increased expenditure on recruitment and training represents only a small proportion of the total cost of labour turnover. Much greater costs may be incurred through:
* Poor recruitment with the wrong people being selected for the job, perhaps interviewer did not select the right person.
* Low levels of motivation within a department.
* Employee dissatisfaction with unfavourable wage rates or working conditions maybe not getting enough for their use and may introduce fringe benefits to keep their employees. For example Safeway offer a competitive salary and an employee can look forward to a range of benefits including:
* Generous holiday entitlement.
* Contributory pension scheme.
* Staff discount card.
* Subsidized meals and drinks.
* Share save scheme to become a Safeway shareholder.
* Safeway Lifestyle Voluntary Benefits which are a wide range of discounts on services including mortgages, electrical services, personal travel services and fitness.
* Bonus scheme.
* Staff uniform.
* Premium payments for Sunday working.
Safeway employees become eligible for further benefits such as medical cover as their career progresses, and their store social committee organizes different number of activities like theatre trips to Christmas parties.
* Failing induction process and employees are not made to feel comfortable.
It is also important that Safeway measure the labour turnover rate to warn of potential problems, so that the management can take appropriate action. The replacing of employees can cause a lot of disruption in the efficiency; it can also create costs for recruitment and training. For Safeway to meet its manpower planning it is important that it minimises labour turnover.
Labour stability index – This outlines stability because it emphasizes the employees that stay within the business rather than those that leave, this is another important ratio that is used and a measure which is more suitable is the labour stability index, as the labour turnover is generally measured. The labour stability index is measured by this formula: –
Labour stability = number employed with more than 12 months service x 100
Total number of staff employed one year ago
The labour stability for Safeway is: 157 x 100
Labour stability = 80
The index stability represents stability because it emphasizes those employees that stay rather than leave. The labour stability, which is 80, means that only 20% of workers leave, so this is a very good employment for Safeway.
Sickness and accident rates – Absences are bad for companies as work is not done, and sickness rate is measured using the following formula:
Sickness rate = number of working days lost per year due to illness x 100
Total number of available working days
Due to the Health and safety at work act 1974, an organization is required by law to investigate a keep a detailed record of its accident rates, accidents can be caused by factors such as:
* Insufficient safety training.
* Stress, caused by too much to do.
* A lack of safety equipment.
* Poor motivation, money related perhaps due to unhappy with their work surroundings.
These factors can result in ineffective working practices and reduced efficiency, keeping records allows an organization to protect itself from legal actions and will help identify and deal with causes of accidents before problems occur.
Safeway circulate an annual health and safety report to employees in order to illustrate where we are and actions underway to improve our health and safety performance. They are always encouraging employees to consider key health and safety challenges facing Safeway and how they can make a difference:
* Protecting members of public and visitors visiting Safeway premises.
* Reduction in stock handling injuries to staff.
* Motivation and training of staff in health and safety.
* Improving the safety of contractors during construction and maintenance operations.
Age Structure – This information is useful for several reasons, it will help highlight a potential staff shortage that may be caused by a large number of employees all reaching retirement age, mostly students are most willing for jobs. When deciding the allocation of training opportunities a detailed analysis of the age structure of the workforce is needed, for example who is in need of training and you would not give training to pensioners, elderly as they are not in need of it.
Succession – This analysis identifies any managerial and supervisory posts that face a weak replacement position and for this reason the assessment of employees must be a continuous process, the manpower plan allows plans to be made for the effects of retirement or resignation among supervisory and managerial employees. An organization needs to know if it has the appropriate employees in order to promote and transfer them to the managerial positions.
Safeway’s are committed to the provision of a full outplacement and career-coaching service at all levels. This will be supported by the development of their own internal re-deployment framework. They also plan to further enhance their system provision, enabling automated succession planning and competency modelling, which will support the above.
To support improved communication across their Business. In October 2002 the ten year old Human Resources System was replaced by a new, more efficient management information system (People soft). This manages the company’s and facilitates our performance management and succession planning processes:-
* Recruitment administration.
* All personal and job details.
* Information about absence, discipline and grievances
Recruitment and Selection
The ultimate success of a business depends upon the quality and contribution of its workforce, businesses recruit staff for a variety of reasons. Before recruiting it is essential to ensure that there is actually a need to recruit workers. External influences such as technological developments can change job roles within the business creating a need to recruit new people with specific skills. Other reasons why businesses recruit include the following:
* The growth of the business – When existing jobs are being expanded human resources management simply needs to copy existing practice on a larger scale. In creating new jobs more detailed thought is required particularly if the jobs are quite different from those that already exist within the organisation.
* Changing the job roles within the business – Due to the rise in information and communication technology, there has been a change in businesses job structures. When developing new jobs requires considerable amount of research, which is often done by examining best practice in businesses or by looking at the development of new jobs in other countries.
* Filling vacancies created by resignation, retirement or dismissal – In all businesses people move on, they become older they either hand in their notice or are dismissed. So it is necessary for employers to replace their employees.
* Internal promotion – In any successful business there will be opportunities for internal promotion, this allows an employee something to aim towards in a business rather than looking elsewhere for something better. When one employee is promoted, sometimes they need a replacement.
The recruitment process as illustrated is a tried and tested process that aims to reduce the risk of selecting the wrong person. It can be costly in terms of resources devoted to the process and costs associated with recruiting poor performing employees, it is important to select people accurately for interviews. Businesses need to be very clear always about the requirements of the job and about the kind of person they are seeking for. The following ways can be achieved through:
* Job descriptions – A job description is used as a job indicator for applicants, it is also used by managers to identify their roles and responsibilities within the business. This also can be used by businesses to provide information to be used in making a vacancy advert and for briefing interviews. A job description normally follows a similar pattern of headings:
* Title of post, this should give a good indication of what the job is.
* Position within business structure, state who the post holder is accountable to and who is accountable to them.
* Duties and responsibilities that need to be performed by a job holder and the skills and qualities required.
* Responsibilities for assets and materials, the rage of materials and physical assets the job holder will be responsible for.
* Person specifications – this describes the characteristics and attributes which a person needs to be able to do the job to the required standards. It can also be used to make sure a job advertisement conveys the qualities that prospective candidates should have and check candidates have the right qualities.
* Achievements, what education, qualifications and experiences does the applicant need?
* Personal attributes they have e.g. works well in teams or on their own.
* The amount of experience in the business industry or related areas.
* Carefully planning how and when to advertise – This process is to attract only those people who fit the company’s person specification Advertisements must reach those who have the qualities to fill the vacancy, the business needs to be aware of who there target audience is(manager, supervisor, etc) and also where the advert will be placed(on a notice board, broadsheet paper, local job centre).The presentation of the advert is very important as it gives prospective employees a first impression of the business. A good advertisement needs to contain the following information:
* Job title, details about the business and who would I am working for.
* Job description, what would I be doing.
* Location, where would I be working.
* Salary, what financial reward would I get and an indication should always be given.
* Qualifications needed for the business must be stated clearly.
* Address and contact, so that the applicant can contact the business for further information.
* Fringe benefits, additional things an employee will receive other than pay.
* Organisational identity, this may be in the form of a logo.
Safeway as a Company undertakes a positive and proactive approach to equality and diversity. They recognize the benefits of providing a working environment in which everyone feels valued, respected and able to contribute to the success of the business and also wish to employ a workforce that reflects the diverse society of which they live in and serve.
To ensure that all colleagues remain committed to and involved in promoting diversity, it undertakes the following activities:-
* Dignity and respect training entitled ‘Appreciating Differences’ is provided for managers throughout the Company.
* Conduct diversity profiling across their workforce and this information is fed back to each of their stores, to ensure that the workforce in each location reflects the profile of their local community.
* They advertise vacant positions both within their stores and through the distribution of fliers to local communities.
* Use both internal and external posters and recruitment materials targeted at workers of different ages.
* They also utilize the ‘Age Positive’ and ’50 Plus’ websites when advertising positions.
* Springboard is used to target school leavers.
* They are accredited to use the Positive about Disability symbol on our recruitment literature.
* They are committed to interviewing all disabled people who meet the minimum job requirements.
* They make any reasonable adjustments required to meet the needs of disabled applicants and colleagues.
* We have developed partnerships with around 40 external providers such as Re-employ and the Shaw Trust. In 2002/3 we employed approximately 140 people on supported placements.
* Identify the strengths and weaknesses of job application: CSV’s and letters of application – A CV is a document usually prepared by the job seeker, it is similar to an application form. It supplies an employer with the job seeker’s details. It must be truthful and positive and should have the following information:
* Personal details.
* Work experience.
Letters of application should be written to support a CV, it should have
A clear structure, with beginning, middle and an ending. Which should
state the following:
* The reason applying for the job.
* The contribution that can be made to the business.
* The developed capabilities through training and education.
* The skills and knowledge acquired that will help in the job.
* Short listing candidates – This process involves looking through the completed applications to narrow the number down to a manageable number, it helps eliminate all the applicants that do not meet the job requirements.
* Taking references – Most businesses an applicant’s reference will be considered by the employer before a contract of employment is agreed. It is an opinion usually in writing of a person’s character, ability, honesty and reliability. Some employers tend to not even consider the job applicant until they have seen a reference from a college or previous employer.
* Job analysis – The first stage is to conduct a detailed analysis of the job, which may involve questioning the current job holder at work. It might be obtained through discussions with the job holder’s manager or supervisor. The job analyst compiles a description of the main responsibilities of the job by asking:
* What are the main tasks of the job and how often do they need to be completed.
* What mental processes are required to do the job.
* Is the job holder required to take decisions and use initiative.
* Is the output from the job a part or a whole.
* Does the job holder have to work with others or control the work of others.
* What are the required performance standards.
Recruitment and selection are linked, selection interviews also present candidates with a realistic picture of what the job entails and what it will like to work for the business. Selection interviews are well organised they must be arranged at convenient locations and times. The selection should attempt to get the best people within the existing budgets i.e. candidates with the most appropriate skills, experience and attitudes. It should also select people who will stay with the business for a reasonable time and minimise the costs of recruitment and selection relative to returns.
In Safeway’s selection depends on the position you have applied for, one of the following selection processes will apply:
At this level, we call our store recruitment process ‘Selecting for Excellence’. It usually consists of 2-3 stages depending on the position you’ve applied for.
* Completion of the Application Form.
* You may be required to complete a pencil and paper test, followed by a short practical exercise which measures a range of skills and abilities.
* Attend a selection interview.
The recruitment process in Safeway is highlighted below:
* During 2002/3 they created 1500 net jobs (permanent roles only), principally in stores across the Company.
* This year they have centralised recruitment centre in Warrington became fully operational, and received a weekly average of 11,300 phone calls to their recruitment hot line.
* They advertise vacancies for all stores on-line in the ‘Careers’ section of their website and receive approximately 820 job applications via the Internet each week.
* 32 graduates have joined the business this year, 12 on the new store specific graduate programme.
* The retention of people is a key part of their HR strategy on an ongoing basis.
Safeway’s work with other External organizations concerned with diversity or are members of include:-
* The Employers Forum on Disability.
* The Disability Rights Commission.
* The Retail Employment Development Group (RED Group).
* Diversity Network.
* The Employment Services (Job Centre Plus).
* Age Positive.
* Commission for Racial Equality (CRE).
* DEXTRA, Diversity Network Group.
* The Employers Forum on Age.
The Employment Rights Act 1996 states that the employees should receive certain information within the first two months of starting their employment. All contracts of employment should include the following:
* The names of the employer and the employee.
* The name and address of the place of.
* The date when employment began.
* The job title.
* Employment conditions e.g. full time, part time, permanent, temporary.
* The salary.
* The intervas in which the employee will be paid e.g. monthly or weekly.
* Any terms and conditions relating to holiday entitlements (including public holidays, sick pay and pensions).
* The length of notice required from either party.
* If the employment is temporary, how long it is expected to continue.
* Any disciplinary rules to which the employee may be subject.
Training and Development
Training envisages all types of planned learning experiences and activities aimed at making positive changes to the performance of the employees and other behaviour, which will help them gain new knowledge, skills, beliefs, values and attitudes.
As the technology develops and advances with a very high speed, it is necessary for the business to acquire these new innovations which will be available in the market and provide appropriate training to its human resources so that it will be in a position to operate efficiently and be able to compete with other business of the same nature.
The training programme for a business is part and parcel of manpower planning which require a through analysis and continuous adjustment over time in relation to the existing and the new technology.
Safeway believes that its employees are its best assets, they are provided with knowledge, skills and tools to be the leading retailer in our markets. Whether it’s providing customer service, offering exceptional products at a competitive price or learning the latest in merchandising and display. The company’s training program provides the individual with a solid foundation to achieve their best.
There are different forms of training, namely;
* Induction Training – It is when employers introduce new employees to the business. Employers also have to make sure the employees are aware of the new environment and have the necessary information on specific areas of the business so that they can perform their tasks. The new recruit is sometimes given an induction pack by the employer, also an overview of Health and Safety, Security and Equal Opportunities.
* Mentoring – It is used by businesses so that employees can develop a good working relationship and it also provides employees a chance to learn new skills. Mentoring is mainly when a trainee is allocated to a more experienced employee. If and when the trainee faces any difficulties or problems with their duties, they must seek advice from the mentor.
* Coaching – This is when an employees performance is assessed by the manager, which helps the manager to identify the employees strengths and weaknesses which intern they will need to work together to develop their skills. The manager needs to develop their coaching skills, otherwise this will affect the success of any coaching programme. The manager coaching has to have the appropriate skills and sufficient time should be allocated so that the time could take place.
* In-house training – This is when a business builds its own training department, which provides employees with training and development using resources within the business.
* External training – External training always takes place away from the real working environment, which is an external course that employees are sent on.
* The national training system:
* Training & enterprise councils – This is sponsored by the government and led by local people, which helps businesses to identify their own training needs.
* Investors in People – The initiative is that investing in people is the most effective way of improving the performance of the business. The Tec’s help to asses businesses that want to be recognised publicly as investor in people.
* Individual learning accounts – This is a sort of bank account which the government, the employer and the individual all contribute money which is then used to buy training and education.
* Modern Apprenticeships- Modern Apprenticeships have been designed for people whose learning styles are more suited to a job with training, most of your training is done while you are at work, and lasts for around three or more years. It is very flexible which can be structured to meet different needs of employers.
* National vocational qualifications – the national vocational qualifications are indicators which show occupational qualifications. It is the ability of an employee to reach a specific kind of skills or competence in carrying out a specific job. An NVQ is awarded to an employee after an assessment done by the appropriate institution or work place.
Additionally, 210 Bakers have completed the craft baking NVQ and over 7,000 colleagues have received craft skills and systems training at one of Safeway’s three Regional Training Centres.
The NVQ is a vital part of management training, awarded by city & guilds it is nationally recognised and on successful completion they will become a qualified NVQ assessor in their own right
* National learning targets – the national learning target is set by the government and it is expected that every business institution in the private or public sector to achieve those targets. These targets for example includes target for young, adults and for a businesses as a whole.
Training and development is a continuous process helping Safeway to deliver its goals and benefits to its colleagues as their skills, competence and capability grow. Training for skills remains critical, and this year they launched apprenticeship programmes for Butchers, Fishmongers and Florists, with over 200 colleagues attending the Fishmonger course and 116 the Meat course. They have continued to provide support to the growing Non food offer by delivering training to support our 6 Mega stores and 50 Home Entertainment centres.
Driving improvements in customer service continues to be critical and their Star Service programme was broadened this year to include “Friendliest Store in Town”. To support this, their Selecting for Excellence recruitment tool was extended to assess this key area.
By Safeway building sustainable advantage over our competitors can only be done through their people, they create business culture in which their people are passionate about their products and have unbreakable will to compete and have the skills, knowledge and resources to do their best.
Purpose of Performance Management
The purpose of performance management is to achieve objectives of the business, to provide better customer service, to increase market share (volume, units, and value). Also to maximize profit, to motivate employees (encourage hard work and set targets) and to improve competition within the business. To make the purpose of performance management understandable along with my businesses approach it is important to understand how the HR manager measures performance.
* Performance Management – The performance management process provides an opportunity for the employee and performance manager to discuss development goals and jointly create a plan for achieving those goals. Development plans should contribute to business goals and the professional growth of the employee. The planning process must also involve consideration of the emerging business environment, for some performance managers the changing environment offers many new challenges and opportunities. Performance managers and their employees are increasingly being asked to become generalists who step outside of traditional narrowly-defined job descriptions in support of team objectives and goals. These changes are resulting in the development of new approaches to human resource management.
* Management by Objectives – This is a system in which specific performance objectives are jointly determined by managers and their employees, the progress toward objectives is reviewed periodically and rewards are allocated on the basis of this progress. The principles of management by objectives are specific objectives for each employee, performance evaluation and feedback and explicit time period. All objectives should be discussed with both managers and employees, this process is used and is likely to be successful if the businesses objectives met the SMART criteria. These are known as the following:
S – Specific
M – Measurable
A – Agreed
R – Realistic
T – Time related
* Monitoring Performance – This process requires the measurement of performance which then needs to be linked with these performance measurements against the achievement of objectives. What needs to be taken into account when comparing performance with targets is the general context that a particular operation is taking place.
* Individual Performance Review – This process is for individual employees, which is usually implemented with the following review systems:
All Safeway colleagues have a performance review at least once a year, although more frequent reviews may be requested by individual colleagues. The progress of new colleagues is reviewed at six, twelve, eighteen and twenty-six week intervals after appointment.
* Appraisal – This system is used by the employer to help them review the standard of work being done by employees within the business, and also assess the value or contribution of individual employees. It is used by employers to reinforce company goals, identify training needs and career opportunities, recognise good performance and review and set targets. Appraisals can be expensive and time consuming, but good appraisals have positive effect on employee’s motivation.
Instead of appraising employees by rating their performance, which could intern discourage employee’s involvement and will not help overcome weaknesses. Some managers may use personal performance interview, which should cover a review of performance objectives over the previous year, an assessment of an employee’s strengths and weaknesses based upon key job related criteria and a personal job improvement plan.
* Self Evaluation – This is when an employee is asked to review their own performance before attending a performance review interview, this enables employees what their objectives are and identify training and development needs.
* Peer Evaluation – Peer evaluation can be a useful and valuable tool in helping employees to develop their critical skills and insight into the evaluation process. By making a critical appraisal of another employees work or performance, they can begin to understand the requirements of the business and what it entails. The only problem with this objectivity is that some employees might be in competition for a promotion or perhaps favour a friend to promote their own personal interests.
* 360 Degree Evaluation – This is one of the instruments that is used to evaluate the performance appraisal based on data collected from all around employee, such as customers, supervisors, peers and sub-ordinates. This evaluation provides feedback on abilities, skills, knowledge and effectiveness of the employee with the business.
Based on the findings of the evaluation it can be highlighted the areas that need to be improved and type of training that needs to be undertaken to further develop the skills and the knowledge of the employees, further more the data collected will serve as a basis for any future improvement of the business activities as well as giving a new guideline for the management. This kind of evaluation will also help deal with emergency situations and build up a strong relationship between management and employee.
* Managing performance in the modern business environment –
The business environment is subject a continuous changes and it is the most critical aspect of effective management. The performance management has to reflect these constant changes which have an extensive and complex impact on business.
Managing Change – These changes are of different nature, and the response varies with the situation. If these changes are badly handled can lead to serious consequences, which may include:
* The frustration of sound strategies and the lack of its implementation.
* The costs of implementation may rise. There might be unnecessary delays, spoilt work and emergency action to reduce the impact of delay all add to costs.
* Benefit of the market may be lost due to the inability to compete with businesses in the market.
* The human consequences of the change may be high. For example when people lose their jobs due to change or when the change is handled carelessly or without adequate planning.
* Motivation reduced or lost within the business as people become confused due to poor management.
* Resistance to future change may increase when they see their worst fears about the change are justified.
The management has to adapt new methods in response to the changes in the labour, consumer, world and technological markets. The management has also to ensure that all measures in response to the changes should be smooth and effective with minimum damage to the employees and the business itself.
Any organization has the obligation to provide its employees with suitable and safe working environment and abide by the employees’ rights and interests. An organization has also the obligation of abiding by new government legislation and regulation and if it fails to do so it can face prosecution or financial costs.
Some employers and business organizations are of the opinion that the recent legislation on working hours has limited their ability to operate flexibly and made it more difficult to improve their performance.
Working Time Directive
In October 1998 the UK government has introduced a new Working Time Directive as a measure designed to protect the health and safety of employees. This Directive covers seven areas:
* Maximum working weekly hours- it should exceeds 48 hours, but it leaves the option for an employee to increase if he or she wishes.
* Employees are entitled to have 11 consecutive hours in each 24hr period of daily rest.
* An employee that has worked six hours is entitled to a 20 minute rest break.
* In each seven day period employees are entitled to an uninterrupted rest period of 24hrs.
* An employee must get at least four weeks paid annual leave by their employer.
* An employer should make sure that employees take regular breaks and are not subjected to high risk tasks.
* An average of eight hours in any 24hr period should be worked by night workers but if they should get sick they then must have the option to move to day jobs.
Maternity and paternity leave – According to the Sex Discrimination Act 1975 and the Employment Rights Act 1996 have entitled pregnant employees, maternity leave regardless their length. The maternity leave has been extended from 14 to 18 weeks, under the 1999 legislation. Employees are entitled to their statuary and fringe benefits during their leave period, and are free to come back to work after maternity leave. The earliest time that can be taken is 11 weeks before the baby is due. Many employers do not grant paid maternity leave, and there is no legal legislation for it. Although some companies and local councils grant paid leave, and the average leave period for paternity is ten days.
Safeway aims to assist both male and female colleagues in managing their individual work-life balance, through a wide range of employment policies and practices in areas such as maternity and paternity leave and flexible working, many of which offer benefits over and above any minimum legal requirements.
The Minimum wage – In order to protect employees from exploitation this law was introduced in April 1999, it covers any UK employee who is aged 18 or older. The legislation covers agency workers, home workers, casual and temporary employees, and people on fixed term or freelance contracts as well as full and part time employees. Currently there are three bands for minimum wage:
* A rate of ï¿½3.60 per hour for those aged 22 and over.
* A rate of ï¿½3.00 per hour for those aged 18 to 21.
* A rate of ï¿½3.20 per hour for those who are 22, and are within the first six months of a new job.
* Improving performance through raising employee motivation
* Motivation – A strong team needs individuals who are dedicated to giving their best at work. Highly self-motivated, committed, ambitious employees give the most to their company and get the most from their work. But if employees are lacking motivation the effects can be dramatic, such as low team morale, lack of initiative, lack of energy, mistakes and high staff turnover. Motivational experiences improve employee attitudes, confidence and performance. Good leadership demands good people-motivation skills, motivational methods are wide-ranging, from inspirational quotes and poems, to team building games and activities, as ice-breakers or warm-ups and exercises for conferences, workshops, meetings and events which are great for staff motivation.
When you break down barriers such as misunderstandings, prejudices, insecurities, divisions, territories and hierarchies – you begin to build teams. If you take a group of people in a room having fun with juggling balls or spinning plates and barriers are immediately removed, teams unite and work together when they identify a common purpose. It can also be generated by a pay increase, by promotion or by simply by the status and satisfaction associated with possessing a new skill using the most up to date machinery or equipment. Managers can use non financial and financial means to motivate employees.
This year the key areas for them to focus on with regards to their colleagues will be retention, development, motivation and maintaining morale. They will need to do this whilst preparing for and responding to any changes which the business may face.
* Hertzberg’s two factor theory – Hertzberg’s two factor theories is a simple but powerful way to understand an employees needs. Hertzberg believed that Hygiene and Motivator are two levels of needs which are as equally important for job satisfaction even though they worked in different ways. If the lower needs are inadequate workers will quickly become dissatisfied, however, as these needs are satisfied trying to motivate staff by just adding more hygiene factors such as wages or work hours is an inefficient and short term solution. A better way would be to appeal to their higher level needs by giving them more responsibility or giving them greater scope for advancement, in this way the individual’s goals are satisfied as well as those of the business. The two factors are the following:
Hygiene – Hygiene factors are based on the need to for a business to avoid unpleasantness at work. If these factors are considered inadequate by employees, then they can cause dissatisfaction with work. Hygiene factors include:
* Company policy and administration.
* Wages, salaries and other financial remuneration.
* Quality of supervision.
* Quality of inter-personal relations.
* Working conditions.
* Feelings of job security.
Safe has implemented its own hygiene management, a review of cleaning standards within stores has commenced with the objective of building on existing cleaning procedures. This has involved a comprehensive review of their cleaning procedures assessing developments in the cleaning industry to enable the best and most effective use of consumables and equipment used to clean their stores.
Motivator – Motivator factors are based on an individual’s need for personal growth. When they exist, motivator factors actively create job satisfaction. If they are effective, then they can motivate an individual to achieve above-average performance and effort. Motivator factors include:
* Opportunity for advancement
* Gaining recognition
* Challenging / stimulating work
* Sense of personal achievement
* Personal growth in a job
* McGregor’s theory X and theory Y – Douglas McGregor, an American social psychologist, proposed his famous X-Y theory in his 1960 book ‘The Human Side of Management’, he suggested that there were two types of employees each with different needs. McGregor’s X-Y theory is a simple reminder of the natural rules of managing people, which under the pressure of day-to-day business are easily forgotten. He also argues that the type of employee a person will become is influenced by the management style they are under.
Theory X – It conveys negative view of human nature, but is the primary source of most employee motivation. A Theory X manager assumes the following:
* Work is inherently distasteful to most people, and they will attempt to avoid work whenever possible.
* Most people are not ambitious, have little desire for responsibility, and prefer to be directed.
* Most people have little aptitude for creativity in solving organizational problems.
* Motivation occurs only at the physiological and security levels of Maslow’s Needs Hierarchy
* Most people are self centred and must be closely controlled and often pushed to achieve business objectives.
* Most people resist change.
Theory Y – This argues that employees gain reward from the job itself and are not money motivated, a theory Y manager makes the following assumptions:
* Work can be as natural as play if the conditions are favourable.
* People will be self-directed and creative to meet their work and organizational objectives if they are committed to them.
* People will be committed to their quality and productivity objectives if rewards are in places that address higher needs such as self-fulfilment.
* The capacity for creativity spreads throughout organizations.
* Most people can handle responsibility because creativity and ingenuity are common in the population.
* Under these conditions, people will seek responsibility.
* Maslow`s hierarchy of needs – Maslow`s theory consisted of two parts the classification of human needs and consideration of how the classes are related to each other. The classes of needs were summarized by Maslow as follows:
A person starts at the bottom of the hierarchy and will initially seek to satisfy basic needs (e.g. food, shelter).Once these physiological needs have been satisfied, they are no longer a motivator. The individual moves up to the next level which is safety needs at work could include physical safety (e.g. protective clothing) as well as protection against unemployment, loss of income through sickness etc. Social needs recognize that most people want to belong to a group, these would include the need for love and belonging (e.g. working with a colleague who supports you at work, teamwork, communication)
Esteem needs are about being given recognition for a job well done, they reflect the fact that many people seek the esteem and respect of others even perhaps a promotion at work might achieve this. Self-actualization is about how people think about themselves which often measured by the extent of success or challenge at work.
Maslow’s model has great potential appeal in the business world. The message is clear if management can find out which level each employee has reached, then they can decide on suitable rewards.
* Taylor’s principles – Frederick Taylor in his 1911 book “Principles of Scientific Management” intensified the view that employees are motivated by money. Taylor discussed what he called a struggle for control of production between management and labour. In order to control production he developed methods for the measure and design of machining methods as part of a general plan for increasing the planning functions of management. By management planning and providing the support to show the workforce how best to do the job. It showed this clear line and staff organisational structure, productivity would increase because the employee recognizing the higher output would lead to higher pay. Taylor’s principles would support the use of these three pay systems, which are as follows:
* Performance Related pay (PRP) – Performance related pay has been much advocated by governments as a means of promoting labour market flexibility and generating higher productivity, this links output and performance to pay. Due to employee ability to reach specific targets they receive bonuses, PRP rewards good performance so it should motivate. Small increases can prevent feelings of dissatisfaction but to create motivation in a person who will be motivated by money it is necessary for the amounts to be large. Some think that this demotivating employees because it categorises them as good and bad performers because they fail to achieve their targets.
* Piece rates – Employees are encouraged to produce as much output as possible and maximize productivity, this allows employers to identify good performers. It provides employees with a variable income and payment is directly linked to output. Although by paying for quantity not quality, standards can be sacrificed as employees strive to gain rewards.
* Commission based pay – Is for sales staff and employees and are paid a percentage of the value of goods they sell. This motivates employees because due to the level of their salary is determined by their own performance ad help sell the company products.
There is no doubt that the human resources management constitutes one of the important elements which contributes to the success of a business. Besides capital, the element of human resources management requires proper utilization, planning and investment. Investing in human resources includes staff training and development, motivation, recruitment and their wellbeing so that they can be retained in order to carry out their tasks and avoid the unnecessary turnover. Promotion, improvement of staff working conditions, better salaries all contribute to the high standard of production and to the high level of competition in the market. The healthier way of using capital is positively related to the better human resources management.
Qualified human resources improve the competitiveness of business and allow it expansion. As the production technology develops and improves almost on daily basis, it is necessary to have staffs who are properly training to use the new technology. The use of new technology will allow competing with other businesses, reducing costs of production and increasing business profits. Safeway works very hard to maintain their competitive edge, but there will always be times when products are cheaper in one supermarket chain than another. In fact there are often times when Safeway are cheaper and they aim to stay ahead of their rivals by offering the best balance of quality and value and they trust that customers feel that in general they succeed. Here are some of their pioneering initiatives in this area:
* Every week they offer customers great value promotions in Safeway Mega-Deals leaflet.
* They were one of the first to introduce an economy range, Safeway Savers, which offers low prices.
Conflicts may arise between different human resources management within the same business activities due to lack of coordination, understanding and proper planning. Activities need to be coordinated before undertaking. Conflicts can cause lost time, resources, and efficiency in any work team. But when managed well, conflicts can result in new ideas, more informed decision making, and better performance. But managing conflict effectively requires skill, knowledge and experience. These days every organization must train its employees to effectively manage conflict and resolve issues that block performance.
If this were to occur at Safeway they should again need to use communication skills to avoid this problem, because this is a simple conflict that can be resolved by simple communication with the two human resources functions. If this was done they will see that the employee was the one who was not following his training techniques. However the member of staff may have not been trained and the performance management team may think he has and think his performance standards are not acceptable.
These tools will help training and human resources professionals to provide members of their organizations with critical Conflict Management capabilities. These training programmes include workshops on management, leadership, communication, negotiation and diversity.
Effective Human Resources management is critical to the success of any firm. Human resources practices will contribute to the greater financial performance and productivity as well as reduced employee turnover. The changes expected in the next twenty years will cause many challenges to human resource professionals. Therefore, in order to facilitate these changes, many roles and competencies must be developed and the necessary tools such as information technology should be sought to aid along with the process.
Over the last 20 years, the workplace has changed in more ways that one could have ever imagined, resulting from the increase in technology, innovation and globalization. The next decade will bring even greater change, impacting all facets of the workplace, including major changes for the Human Resources Department and human resource managers. In order to respond to the demands of globalization, HR managers will require new skills and competencies relating to language and culture, technological capabilities to facilitate overseas communication, methods to measure and quantify effectiveness and evaluate strategies and return on investment. Evidently, these new skills and competencies will result in an emerging new role for HR managers, requiring them to be strategic business partners, supportive of the overall corporate strategy.
The future of role of human resources professionals will change from a less administrative role to more of a strategic role (Workforce, January 1998, 89). HR managers will continually be required to prove their effectiveness and their existence. They will be expected to understand international business practices and promote cultural diversity within the organization. They will need to understand the core business of the organization and become partners with line managers. They will need to prove that their initiatives and programs are results-oriented, providing specific measurable results in terms of business competitiveness that contribute positively to the bottom-line of the organization. They will be required to stay current with leading-edge as more and more organizations are faced with the demands of globalization and strategic alliances with other organizations around the world