The concept of Strategic Human Resource Management has attracted a lot of attention from scholars and practitioners since it came to the surface in the mid 1980s. Strategic Human Resource Management has replaced the word “Personnel Management” in the field of Human Resource. Moreover, scholars agree that Human Resource Management is the right approach to managing people at the work place since it meets the requirement of what happens in the highly competitive market structure. Strategic Human Resource Management adds value and profits to companies while making managing fun and exciting since it challenges workers to think for themselves (Armstrong, 2000, p. 5). This paper examines Men’s Wearhouse use of learning and growth, competency development, corporate culture, leadership development, to grow in a highly competitive business environment. Before delving on how Men’s Wearhouse applies these principles, the paper explains the concepts and the literature review behind the key concepts of Human Strategic Management, Competency Development, Corporate culture, Customer Value, and profitability.
The concept of Human Resource Management
Strategic Human Resource Management has been designed to help corporations meet the needs of their employers while promoting the goals of the companies (Upson, 2012). Armstrong (2000) defines Human Resource Management as a “a strategic and coherent approach to the management of an organization’s most valued assets- the people” working who contribute to the achievement of the company’s objectives (p.6). In simpler terms, SHRM is the proactive management of people. It involves thinking ahead, planning, and ensuring that the company satisfies all its parties.
Armstrong argues that there are two types of HRM, soft SHRM, and hard SHRM. Hard HRM emphasizes the quantitative, calculative, aspects of managing the headcount resource in a rational way for any other economic consideration (p.6). The soft HRM, on the other hand, premises on the power of communication, motivation, and leadership. Story (1989) describes soft HRM as valued assets and a source of competitive advantage through the commitment, adaptability, and high quality of performance. In soft HRM, attention is the place on organization culture and not short-term quick fix antics.
Schuler & Jackson (2007) emphasizes soft HRM over hard HRM for effective development of workers and efficiency in the work place. Schuler & Jackson argue that the advent of globalization has increased competition in the global economy making effective management of people essential in realizing profits. Moreover, new forms of organization such as joint ventures, international mergers, and acquisitions require flexible mindset for effective management of personnel. Because of this change, the old hard HRM fails to succeed due to change in cultural dynamics.
Importance of Strategic Human Resource Management
Masters (2012) writes that strategic human resource management is essential for a company that is hiring, firing, and compensating. A company must ensure that it has a human resource management unit that is up to the task and can meet the needs of its employers even as the company aspires to meet the company’s needs and maximize profits. Terry Masters (2012) argues that sound human resource management is beneficial to the company in terms of reducing cost and handling employee’s remunerations, compensation and termination of employment. Companies strive to meet the needs of its employers cultivates a work environment that is both convenient and productive. It is in order for a company to create an environment that encourages its workers success. A pleasant work environment increases productivity of workers.
In addition to creating a healthy work environment, a company should have a recruitment strategy that looks for the most promising applicants. Testing the potential of the future workers requires that prospective employees be subjected to tests, skits, as well as situations that assist in determining their morality and ethics of work. A successful recruitment system reduces chances of firing thus reducing the costs that may arise because of such situations.
According to Condrey (2010), a company must also be familiar with the laws that apply to issues in the line of compensation, pay, and benefits. Knowledge of the law is a key essential in making a company avoids unnecessary legal cases and fines that may arise out of compensation battles. It is important that the human resource department is aware of laws on issues such as immigration, minimum wage, legibility to compensation and insurance among others.
Liberty University’s Human Business Management Resource (2010) advises that when a company is hiring it must also be aware of the remunerations of the individuals of individuals based on their qualification. The qualification of an individual determines how much salary they are entitled to and compensation that they receive. However, job scope, location of the company and the cost of living dictate how much an individual can earn. While jobs that require higher training and experience attract more earnings, jobs that require less training equal to less pay. Individuals doing unskilled jobs are subjects to replacement if they can do their jobs properly since replacement is easily available.
Learning and Growth Competency Development
Competency refers to the behaviors that individuals possesses or must possess to perform work. Competency, therefore, focuses on the individual’s input and the outcome thereof. Measuring competency requires what is usually defined as competency structure. The competency structure is a framework that defines the company’s expectation on each individual. Laske (2001) wrote about learning and growth development. According to them, the growth and development is a framework for quantitatively assessing employee satisfaction, productivity, and relation in the framework of scorecard balance. The learning and growth method emphasizes measures not only as employee’s behaviors but also in developmental terms at work.
According to Taylor (2007), contemporary frameworks are gaining ground in corporations all over the world. Over sixty percent of organizations have established company framework for their employees. Forty eight percent of companies that have not established competency are planning to do s in the coming years. Competencies framework cultivate skills such as communication skills, people management skills, team skills, and competency skills that are vital for the success of companies to today.
Measurements and Appraisal Drive Performance
Measurements of appraisals performance premise on the belief that improving work quality from the worker leads to an increase in pay (Taylor, 2007). Cushway (2009) writes that the performance appraisal is something that happens continuously at work. Performance appraisal includes assessing how workers are performing and rewarding them for competence. Effective appraisal drive performance includes aspects such as reviewing experience, helping workers improve, identifying, and developing needs, improving communications, and allowing employees to express their feelings. The focus of t appraisals drive argument is that individual’s number one motivational factor is money.
Coen & Jenkins refute the argument that money increments insinuate performance. According to them, pay for work incentives have unintended side effects that are not often pleasant. These side effects usually undermine the company’s real objectives and goals. “The bottom line is that any approach that offers a reward for better performance is destined to be ineffective (p.248).
Corporate Culture
According to Schein (2009), corporate culture refers to shared beliefs, values, and behaviors that a firm subscribes. These beliefs, values, and expected behavior provide a foundation upon which a firm is managed. The organizations executives articulate cultural statements to the workers. Usually, firms with a strong corporate culture outperform those without a strong corporate culture. Because culture is relative, organizations have the power to create a culture that fits organizations objectives.
Corporate culture plays out in various ways. Company’s culture can be distinct in ways such as the way they handle communication, feedback, project coordination, or customer relations (Kotter, 1992). In some cases, corporate culture is visible in the way an organization is structured. Some companies emphasize servant leadership while others focus on teamwork; others promote basing on appraisals while others promote basing on future objectives. In many cases, the nature of competition and the desire of the company to be like the rest or to form a unique identity defines corporate values for many companies (Schein, 2009).
Schein (2009) argues that the articulation of a corporation’s culture is meaningless if a strong leadership is missing. Leaders of a corporation must be aware of the required culture in a corporation and determine ways in which the culture is understood by all sections for the firm. Leaders must also play the role models by exhibiting behaviors that are demonstrable of the organization’s goals.
Customer Value
Weinstein & Johnson (1999) write that successful companies do not only satisfy customers, they work hard to please them too. Superior customer values mean continually creating a business experience that exceeds the ordinary expectations (p.4). In their view, value is the strategic driver that most multinational corporations utilize to differentiate themselves from the rest in view of customers. In the abstract form, values mean the excellence usually based on the desirability or usefulness (Weinstein & Johnson, 1999, p.5). Gale (2010) reports that a value driven marketing strategy help organizations in several areas including but not limited to:
Helping the company understands customer choices
- Customer segmentation and customer relations management
- Increasing competitive option by creating niches
- Avoiding unnecessary price competitions
- Improving the company’s service quality
- Developing an effective customer communication system
- An effective customer value system makes a big difference between a successful firm and an average firm. It is every company’s benefit to have a clear strategy on developing customer values.
Profitability
Hoftand (2009) argue that profitability refers to the company’s ability to generate earnings as compared to its expenses and other costs incurred during a specific period. Profitability varies depending on the type of service, company, and season. Some companies experience high revenues and earnings during certain seasons like Christmas and low profits during other seasons.
Men’s Wearhouse is an exemplary case in human resource management. While most of the men‘s tailored businesses in the clothing industry were closing because of shrinking industry, financial distress and many other challenges, Men’s Wearhouse was witnessing unprecedented growth (Yatheepan, 2010). Men’s Wearhouse is famous for its communal nature in an industry known for acute competition and financial stringency. According to George Zimmer, the CEO of Men’s Wearhouse, the success of the company results from the philosophy of “making use of untapped human potential” (O'Reilly, C., & Pfeffer, p 85, 2000). Men’s Wearhouse crucial strategic human resource management is perhaps providing an explanation why the company is successful. A company must ensure that it has a human resource management unit that is up to the task and can meet the needs of its employers even as the company aspires to meet the company’s needs and maximize profits (Masters, 2012). Men’s Wearhouse has achieved a competitive advantage by leveraging on workers that many managers would normally ignore. The company prides in its breaking away from the rules of low pay, little training, and treating low-class workers even better than progressive companies treat their workers (O'Reilly, C., & Pfeffer, p 81, 2000).
Men’s Wearhouse does not emphasize money as a primary motivator. Instead, the company gives fair compensation while paying less than their competitors do. Men’s Wearhouse values their workers happiness which according to company, comes from intrinsic rewards of fun, growth, teamwork and challenges and accomplishing them. Men’s Warehouse strives to meet the needs of its employers cultivates a work environment that is both conducive and productive. In order for the company to create an environment that encourages its workers success, the company employs the policy of servant leadership. Under this arrangement, leaders view their subordinates as the actual customers. By encouraging servant leadership, the company improves self-esteem of the workers, encourages listening, as well as facilitating problem solving. The company leaders also travel to ensure that these standards are uniform.
In addition to creating a healthy work environment, Men’s Wearhouse has excessive compensation for its employs that boost morale thereby encouraging striving for more. The company promotes workers from within to encourage vertical mobility amongst workers. Moreover, the company also offers multiple trainings to its employs, so that employs are not only efficient but also able to rise from the position that they hold once they are qualified. In many ways, Men’s Wearhouse goes against Liberty University’s Human Business Management Resource (2010) advice that when a company is hiring it must also be aware of the remunerations of the individuals of individuals based on their qualification. The qualification of an individual determines how much salary they are entitled to and compensation that they receive. In the case of Men’s Wearhouse, qualification is a reward on how much one works.
While striving to meet the needs of its employers, Men’s Warehouse faces challenges. The biggest challenge the company confronts is the rising labor costs. Training low class employees means that the company spends a colossal amount of money on labor costs. In addition to training, the company pays compensation for its workers to ensure that it encourages progress amongst workers. However, the company maneuvers through the rising labor costs by its value in the discretionary effort by employees, reduced rate of sacking and hiring, and higher rates of productivity amongst the workers. As a result, the company increases profits that keep it at the apex (Liberty University, 2012).
The company’s policy of encouraging servant leadership implies that the company let the workers manage themselves based on the company’s values while giving up management. Servant leadership implies that the companies top leadership is denied the trappings that other CEOs is in other companies are accorded. As a result, few CEO’s are comfortable working with Men’s Wearhouse because of comparative low wages, modest offices, and less fancy lifestyle. Moreover, Men’s Wearhouse lays emphasis on the mutual obligation between workers and company. For this reason, the company trades long-term employment for flexibility and performance. For many CEO’s, this value system is boring hence they shy away (O'Reilly, C., & Pfeffer, p 226, 2000).
Infante (2001) reports that Men’s Wearhouse edge over its company is a function of strategic human resource management. Chief Executive Chris Bresler argues that the company’s success comes from the company’s value to its employees. Men’s Wearhouse gets the value out of their employees compared to their competitors. Men’s Wearhouse has some of the best customer value ratings. According to Bresler, Men’s Wearhouse workers treat customers with friendliness and love not because they are super trained in customer relations, but because they feel good about their work. The feel good energy is translated to work, and this builds the company’s service.
Men’sWeahouse aims to reach its online customer base by employing online media. Because the majority of the target market is online, Men’sWearhouse believes that online marketing would be an effective method of reaching its customer base. Because of the influence of the social media in the net, the company aims to use social media as an effective way to gain exposure and brand recognition to a highly target market segment. The company w uses common social networks such as Facebook, Twitter, and YouTube amongst others. Some of the reasons why Lizard uses social media are because social media groups such as Facebook enables it to target specific users by age, interests, location and education level. By using Facebook pages, Men’sWeahouse would be able to pin point target market s through Facebook adds as relatively cheaper and more efficient ways than using television adds .
The world offers a very big market for companies to exploit. Because of globalization, firms are given unlimited opportunities across the globe that they can effectively exploit for their own benefits. The global market, when effectively used, provides a room of expansion. However, for companies to reap the benefits of globalization, they must be ready to play with the rules of the games. First, the company must be ready to meet the needs of all its customers across the world. Coca- Cola Beverage Company is perhaps a classical example of a company that has used the global market to expand its operations unrivalled with any beverage company. Establishment of the global market brand and customer base is thus one of the biggest advantages of global marketing. Coca-Cola has achieved this status by tactful advertisements and promotions aimed at luring consumers to feel that Coca-Cola represents their own taste. Coca-Cola sells the same product worldwide but standardizes the product to meet the needs of its customers based on cultural preferences. Men’s Wearhouse Management is geared towards ensuring that the company uses strategic methods to have an over edge over other companies in a very competitive environment.
In conclusion, this paper has explored the role of strategic human resource management, particularly in the areas of customer relations, appraisals, profitability, and growth and competency development on how they are important to the success of a business. We have used Men’s Wearhouse corporate culture of servant leadership and community engagement as a case study of a company that used the method of strategic human resource management to stay on top of its game.
References
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