Executive Summary
British Petroleum (BP) has to design and implement a change management program with immediate effect. This is to convince the workforce that the proposed massive job cut is vital for the survival of the organization. As part of this program, the BP management has to make some key changes to its HR policies and practices. The organization should rely specifically on mobile-based e-learning platforms and social media learning in order to promote HR training and development. In addition, the company may use tools such as recognition, perks, and gifting for rewarding employees who go beyond their responsibilities. Finally, the company is advised to promote interpersonal relationships among employees in order to manage employee relations effectively.
Introduction
In this highly competitive global business environment, it is vital for corporations to cut down their operating expenses to improve their profitability and thereby gain a competitive advantage over their market rivals. In the oil and gas industry, declining oil prices force companies to reduce their expenses notably to survive the adverse market situations. BP has recently announced that it would cut 4,000 jobs globally this year in an attempt to vie with a 70% oil price collapse across the industry. While implementing such a massive job cut, it is necessary for the organization to keep its employees motivated and loyal to the company. The company has to redesign its HR policies and practices to instill confidence in employees in the context of the job cut announced. This paper will explore ideas regarding HR practices and policies for BP in the light of current market scenario in the global oil and gas industry.
The Current Business Environment
British Petroleum or BP plc, headquartered at London is a multinational corporation operating in the oil and gas industry. Currently BP is the world’s fifth largest corporation by means of turnover and the sixth largest in terms of market capitalization. The overall objective of the organization is to maximize wealth and shareholder values without actually causing any harm to people or the environment. The company states that “the best way to achieve sustainable success as a group is to act in the long-term interests of our shareholders, our partners and society” (BP Plc.). The BP strives to enhance the economic growth as well as living standards of communities by supplying energy. In some circumstances, it seems that the organization has many hidden marketing agendas that prioritize profitability over environmental sustainability. Consequently, the company has been fined several times for violating the environmental standards of the territories in which it operates. Recognizing the threat of growing competition in the global oil and gas industry, BP has taken numerous HR initiatives to enhance the efficiency of its workforce. The company follows different HR training and development strategies to improve the competencies of its senior management that is responsible for dealing with the strategic management of the organization. It is identified that a rapidly changing business environment coupled with the implications of globalization raises a range of potential challenges to HR managers in BP. In the current context of a highly volatile global economic environment, the roles of human resources have changed from administrative to a strategic business partner.
Recommendations for HR practices
Training, learning, and development
BP pays significant attention to employee training, learning and development so as to increase the overall workforce productivity and organization’s competitiveness. The corporation’s global approach to HR development is focused on key behaviors that are crucial to achieving enhanced workforce performance. It is important to note that BP follows a single, common leadership framework, with a set of clear and well-defined objectives. In order to promote continuous professional development, the organization has implemented a series of development programs known as Managing Essentials that focus particularly on helping managers to comply with the leadership framework (BP Global, n.d.). In addition, the Executive Operations Programs run by the BP is beneficial for senior leaders to support the changes proposed by the operations levels management and to make their unique contributions to the process. The company also depends on coaching and e-learning techniques to support HR training and development in the organization.
As discussed already, the global business landscape is changing rapidly, and therefore, it is recommendable for the BP to adopt innovative HR training, learning, and development policies to maintain its workforce productivity and market competitiveness. In addition, the company has announced massive job cuts in response to a 70% oil price collapse across the oil industry. In this context, it is necessary for the organization to develop and maintain a highly productive workforce at cheaper costs to confront the adverse market conditions. Though the organization has already adopted e-learning approach to promote HR learning, it is yet to embrace mobile learning solutions that are effective to expand global reach, to foster employee engagement, and to minimize training costs. Although mobile learning strategy may cause the organization to incur higher costs in terms of developing a technologically advanced mobile platform and professional expertise in the initial state, this approach can greatly benefit the company in the long-run (Noe, 2008, p.452). Likewise, it is advisable for the BP to invest in social media tools so as to foster employee engagement thus leading to the facilitation of social collaboration and creation of a learning culture (IRMA, 2015, p.2094).It is identified that most of the companies are confused about how to use social media tools for employee learning and development. Therefore, the BP is advised to hire experts in social learning and train its workforce about the significance of social collaboration. The company may also rely on adaptive learning approach to determine what learning approach would best suit the needs of individual employees. Adaptive learning strategy has been successfully implemented by many organizations over the last years.
Rewards
In an attempt to cope with the recent changes occurred in the global business landscape, the BP senior management has redesigned employee rewards approach. In comparison to the last decade, the firm’s current rewards approach is more effective in attracting and motivating employees. Currently, the organization is eager to reward employees in such a way to promote employee empowerment. It seems that the BP rewards its employs, in addition to the basic pay, based on their performance against specific organizational goals and objectives. While rewarding employees, the organization also examines whether their performance meets the standards linked to the goals of the team as a whole.
When it comes to HR rewards, it is advisable for BP’s HR managers to design the rewards system in such a way to foster employee creativity and engagement that are considered to be most potential qualities of modern employees. BP is suggested to use MVP rewards for rewarding employees who go over and above job responsibilities. This strategy is successfully used by biotechnology company Genentech with a check ranging from $1,000 to $2,500 (McAllister & Vandlen, 2010). Gifting is another reward strategy recommended for BP to stimulate workforce motivation. Gifts should not be necessarily expensive, but creative gifts can be an effective way for appreciating exemplary employee behaviors in the short-term and for fostering long-term employee loyalty. Experiential rewards, prestige rewards, and virtual rewards are all part of the gifting approach. Recognition is identified to be a major method of rewarding the organization’s best performers (Baskar & Rajkumar, 2013). Using this tool, the BP management can convince its potential performers that the organization values them extremely. In addition, it is advisable for the organization to rely on ‘perks’, which are rewards built into the firm’s overall work environment (Jex & Britt, 2014, p.344). Brag-worthy rewards, concierge-style rewards, and future-changing rewards are the most common forms of perks used by an organization. Under concierge-style rewards, employees are given free services like haircuts and weekly car washes. Today, many companies find future-changing rewards as a potential way to attract and retain potential talents. To illustrate, in collaboration with Arizona State University, Starbucks provides free online college education for its employees (Starbucks.com).When it comes to rewarding top executives, the organization is recommended to consider stock options because under this approach, executives will gain enhanced financial benefits once there is a rise in the stock prices of the company. In other words, top executives would take vehement efforts to improve the share prices of the firm and thereby increase their earnings.
Employee relations
Employee relations constitute a key part of the BP’s HR strategies. The firm’s top management strongly believes that employee loyalty is a major factor determining the long-term success of the organization. BP’s HR policies give great emphasis to employee communication, which is recognized to be the primary step in enhancing employee relations. Therefore, the company has taken extensive measures to promote upward and downward flow of communication within the organizational environment. However, compared to other major corporations operating in the global oil and gas industry, BP is yet to improve its employee relations policy. As the company has announced massive jobs cuts recently, it is extremely vital to focus particularly on employee relations to help employees get rid of the fear of termination. In this context,thoughtful employee relations strategies can promote employee morale and loyalty.
The BP management has to involve its employees in key organizational affairs to convince them that they are an indispensable part of the organization. Rather than imposing work on employees, they should be allowed to choose job responsibilities according to their interests as this strategy would assist employees to reduce their work stress. When employees are asked to perform job tasks that they do not like to do, the situation may end up in fight with superiors and fellow workers. In addition, the company has to encourage its employees to share their work with each other as this approach can effectively enhance employee interactions in groups and the worksite (Markos & Sridevi, 2010). Employees should be allowed to perform tasks and take decisions on their own and managerial intervention is needed only when there are extreme cases of conflicts and misunderstandings. BP’s HR managers should try their best to arrange facilities for employees to have their lunch together. Time, from half an hour to forty-five minutes may be devoted to lunch, and employees should be encouraged to discuss off-work topics during lunch time. HR managers may also encourage employees to go out together for picnics or shopping once in a while. All these strategies can assist the organization to improve interpersonal relationships between employees and thereby reduce the level of worksite conflicts significantly. Morning meetings seem to be another potential strategy for improving employee relations but the management has to make certain that those meetings are not too formal (Kono, 2016, p.63).Written communication should be promoted in the worksite because this type of communication gives better transparency, eliminating unnecessary employee conflicts.
Future Scope
While analyzing the future scope of the organization in the current context of oil price decline and subsequent massive job cuts, it seems that the organization has to be more alert for keeping its employee loyal and thereby maintaining its market competitiveness. When the organization proceeds with massive jobs cuts in an attempt to confront the unfavorable market situation, it would dreadfully affect the morality of employees who may find their career increasingly unsecure at the firm. Hence, the BP management has to design and implement a sensible change management program immediately. This program must be effective enough to convince employees about the necessity of implementing the jobs cut announced. When employees understand that the proposed job cut is vital for the survival of the company, they may cooperate with the change. It is advisable for the organization to help fired employees to find a job outside, and this practice would pass a message to the workforce that BP really values its employees. In short, the company should implement the job cut program sensibly to promote the firm’s long-term sustainability.
Discussions and Conclusions
Bibliography
BP. Plc. (n.d.) Our business model. [Online] Available from http://www.bp.com/en/global/corporate/about-bp/group-organisation/our-business-model.html [Accessed 17 July 2016].
BP Global. (n.d.) http://www.bp.com/content/dam/bp/pdf/investors/bp-sri-safety-operational-risk-nov13-2.pdf
Baskar & Rajkumar, P. (2013) A Study on the Impact of Rewards and Recognition on Employee Motivation. International Journal of Science and Research (IJSR), 4 (11): 1644-1648. [Online] Available from https://www.ijsr.net/archive/v4i11/NOV151549.pdf [Accessed 15 July 2016].
IRMA. (2015) Social Media and Networking: Concepts, Methodologies, Tools, and Applications. US: IGI Global.
Jex, S. M & Britt, T. W. (2014) Organizational Psychology: A Scientist-Practitioner Approach. John Wiley & Sons.
Kono, T. (2016) Strategy and Structure of Japanese Enterprises. US: Springer.
McAllister, R. B & Vandlen, C. E. (2010) Motivating Employees in R&D. Cornell University. . [Online] Available from http://digitalcommons.ilr.cornell.edu/cgi/viewcontent.cgi?article=1016&context=chrr [Accessed 17 July 2016].
Markos, S & Sridevi, M. S. (2010) Employee Engagement: The Key to Improving Performance. International Journal of Business and Management , 5 (12): 89-96.
Noe, R. A. (2008) Employee Training & Development. New Delhi: Tata McGraw-Hill Education.
Starbucks.com. (n.d.) Starbucks College Achievement Plan. [Online] Available from http://www.starbucks.com/careers/college-plan [Accessed 17 July 2016].
