Understanding organizations and the role of HR Essay
Understanding organizations and the role of HR
YTL Cement’s purpose in beginning this business is to supply quality cement to local construction companies for a competitive price especially in the eastern corridor of peninsular Malaysia. There were no cement plants in the eastern side of peninsular Malaysia. So, cost of purchasing cement was high due to logistics. Our plant in Pahang solved all issues as we could now provide cement with a much cheaper price. YTL Cement is currently the second largest cement producer in Malaysia. Our goal is to be the largest cement producer in Malaysia and also southeast Asia. From one cement plant, we have rapidly expanded to four plant now. The goal to be the largest cement producer in Malaysia might come to past earlier than expected.
PRODUCTS & SERVICES
CUSTOMERS & CLIENTS
YTL Cement has customers and clients both locally and internationally. The bagged products targets small contractors, hardware stores and individual purchasers. These target use cement for small scale renovations and other personal use. Bulk cement is usually bought by large contractors who are employed by the government or the private sector to build housing estates, buildings, bridges and more. The cement quantity needed in these projects is huge so purchases are made in bulks.
4 EXTERNAL FACTORS
The cement industry depends on the economy situation. If the economy is stable, then development and construction is on-going. The government and private organizations will initiate projects which include housing and other infrastructure project which requires cement. Hence, the demand for cement will increase. But if there is an economy downturn, it will have a bad impact on the construction industry. And when the construction industry is down, then the demand for cement will decrease which will directly affect the cement industry.
Technology plays a very important role in the process of making cement. Technology has grown and new machinery is constantly being introduced to maximize output and minimize the usage of power. The advances in technology, has also allowed cement plants to increase production on a daily basis. This directly contributes to the profit of the organization. One of the biggest issues in cement plants are the breakdowns. Metal fatigue and corrosion cause machinery to break down which effects production. Technology today allows machinery to run longer with minimal maintenance procedures.
Legal implications always surround heavy industries that effect the environment. New acts and new policies enforced by governments will affect the cement industry. A growing population with growing concerns about the environment will push the government to impose new laws which will directly or indirectly affect the cement industry.
The most important raw material to used to make cement is limestone. Limestone is a sedimentary rock. Limestone can be mined in two ways which are from hills which contain limestone and two, from limestone deposits deep underground. Aggressive mining can deplete the limestone and when that happens, we will not be able to produce cement. As most natural resources, limestone is not renewable hence making it a limited resource. Coal is used in cement plants to heat up the kiln. A kiln is something like an oven where raw materials are transformed at high temperatures. The temperature in a cement kiln can reach up to 1400 degree Celsius. So, huge amounts of coal are used everyday to heat up the kilns. Like limestone, coal is also a limited resource. The depletion of coal will impact the cement industry.
YTL Cement has a top down organizational structure. It is a family owned business. As such, all decisions are made by the Executive Director which is Dato’ Sri Michael Yeoh who is a member of the Yeoh family. Authority is vested at the top and flows down through directors, managers and executives before finally reaching those who make the product. The four functions in this organization which are vital are operations, human resources, finance and purchasing.
The operations team are in charge of the day to day operations of the cement plant and all its machinery. Achieving daily production output is the end result of this team.
The human resources team are in charge of daily employee related activities such as recruitment, training and development, attendance, disciplinary and much more.
The finance team are in charge of financial aspects of the plant in the daily matters such receiving payments, making payments, processing invoices and much more.
The purchasing team handles all purchases made by all the other departments in the plant.
All the functions in the organization work hand in hand to optimize performance.
Operations is the money maker in the organization. The wages, profit of the organization depends on the capability of operation in achieving its targets. The more money the organization makes, the better it is for the stakeholder and the employees. The extra funds can be used in various ways such as upgrading infrastructure and machinery, giving more incentives and benefits to employees, increased increments, better bonuses and much more. Upgrading infrastructure and machinery will directly increase performance. Increased performance leads to increased production which leads to increased profits. Providing better benefits, increments and bonuses, increases the employees’ morale and motivation. A motivated workforce raises productivity. This will directly lead to optimizing the performance of the department which will then optimize the performance of the organization.
Human resources work together with the rest of the departments in the organization in many ways. Recruitment of employees based on the forecast, manpower planning and attrition is an ongoing process. Selecting the right candidate at the right time is vital to insure that performance is not affected. A pool of suitable candidates for key positions must always be available incase of unforeseen emergency. Retention of employees is also important. Each employee carries knowledge, skill and experience of the designated role he or she works in. Losing an employee can affect performance of a department. Resources such as time, energy and money need to be used to re-train a new employee. As such, human resources must always be aware of the current market salary, current compensation and benefits packages, training and development requirements as to keep turnover as low as possible.
The finance department’s activities range from bookkeeping to providing information to managers and directors in making strategic decisions. Finance department is responsible for all the day to day transactional accounting for the organization. This includes tracking of all financial transactions that happens in the organization. The finance department is also responsible for the organization’s cash flow to ensure that funds are available to meet the day to day payments. This is important as to make sure that operations run smoothly without any problems. The finance department also contributes to the management and improvement of the operations by reporting regularly on key numbers important to the success of the organization. They also work with managers and head of departments to prepare budgets and forecasts. This information can be used to plan machinery purchases and expansions and cash needs before they become necessary. All this contribute to optimising the performance of the organization.
The role of the purchasing department is to procure all necessary materials needed for production or daily operation of the organization. For YTL Cement, a heavy industry company, this will include raw materials such as iron, silica, gypsum, coal or sand which will be used in producing cement. Other items procured, which are as equally important such as machinery parts, electrical parts are vital in sustaining operations of the plant. The purchasing department also needs to evaluate the prices of materials procured to maximize profitability. A purchasing department in a small business needs to locate the best vendors’ at the most reasonable prices. Purchasing department staff needs to communicate with many vendors to negotiate a better price for any material which will be ordered.
CULTURE AND ITS IMPACTS
The culture in YTL Cement is more of a Power Culture. All decisions are made by the Executive Director and the Director of Operations. Due to this culture, all decisions are pushed upwards from below. The impact of this culture is employees are not empowered to make decisions about their job. They will always look for higher authority to make even a simple decision. And when employees do not take decision, they do not take responsibility. And when employees do not take responsibility, they do not feel proud of their organization. This also affects the loyalty of the employee which
leads to a high turnover.
3 HR ACTIVITIES THAT SUPPORT THE ORGANIZATION’S STRATEGY
Strategic HR Planning
Strategic HR planning is links HR management directly to the strategic plan of the organization. Organizations nowadays have a strategic plan that guides them in successfully achieving their vision and mission. Based on this strategic plan, the organization can develop a strategic HR plan that will allow HR to make decisions now to support the future direction of the organization. Strategic HR planning also helps to: Ensure sufficient workforce to meet the strategic goals and operational plans of your organization Keep abreast with economic changes, technological changes, social changes and legal changes that impact HR and the cement industry
A talented workforce is essential to achieve our vision and mission. Aligning individual goals with the organizations strategy is a proven recipe for success. Goal alignment is a powerful management tool. When the organization engages employees in their work through goal alignment, a greater employee ownership in your company’s ultimate success is created. Thus, the employees become more committed to your company and achieve higher levels of job performance.
Compensation & Benefits
A good compensation and benefits package will always attract competent employees. Employing competent workers leads to better results and leads to higher productivity. A compensation and benefits plan that rewards employees for company loyalty is also vital in retaining talented employees. When this appreciation is shown to senior employees, new employees realize that the organization values employees who choose to work with the organization for the long-term. This encourages new employees to decide build a career with the organization hence retaining competent employees. 3
WAYS HR SUPPORT THE LINE MANAGERS AND STAFF
Training and Development
Based on the Training Needs Analysis (TNA), HR can then select the relevant training courses and trainers to train the employees. Whether its technical training or management training, choosing the right kind of training with the right modules and trainer is vital. This to make sure that the training is relevant and effective. Training improves employee job performance. This helps reduce job performance disputes and contributes to the department achieving its KPI.
Coaching can improve employee performance, increase employee engagement and reduce turnover. During coaching, the key issue will be on the employee’s performance in the workplace which includes assessment, appraisals and discussing the employee’s strength and weaknesses. Employees feel more engaged when they can discuss their achievement and plan for the future. Engaged employee will work harder, contribute more and are less likely to leave the organization.
Recruitment & Selection
Recruitment includes screening potential candidates using tests and interviews and then selecting the right candidate. This procedure is important the candidate has to be balanced in terms of technical knowledge and also has good character and management skills. This will help department when the right person is selected and the candidate is able to fulfil their new roles effectively. Choosing the wrong candidate can lead to de-motivating and de-moralising current employees, workplace disputes, poor performance by the department and much more.