- One can make it to GM level by 40, if he doesn’t, he cannot.
- Recruitment was done in December
- Training was paid
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Seven cultural values were implemented
- Recruitment was done in 3 tracks i.e.
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Sales Officer ⇨ Level 1
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Young Talent ⇨ Level 1 or 2
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Confidential department ⇨ Level 3-6
- Two career tracks were available
- Technical
- Managerial
- Phase I and III were common for both career tracks training
- Company had a great emphasis on community service
- Each area submits its proposal to HR department identifying man-power requirement & financial implications of the new post.
- Proposal incorporated in ARD which contains budget targets
- ARD is approved by Executive board
- Approval DID NOT authorize recruitment
- Explicit approval was needed
- Initial Screening was done
- Written examination was conducted
- Interview by GM followed
- Second interview by executive board came next
- Being part of the MTO program is no surety of permanent job
- Vacant management slots also effect the candidate’s absorption
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In 1976 company adopted Matrix Organizational Structure
- Management positions were classified in 9 levels
- Quantitative Analysis
- Total Equity Capital of the company is (then) 285.8 million
-
61% was held by company and 39% by public
- Current (then) number of employees are 1474
- Training period duration varied over years
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Training was divided in 3 phases
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Phase I⇨ 2 weeks
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Phase II ⇨ 6 months
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Phase III ⇨ 6 months
- Profit after taxation varied greatly in last 2 years
- ICI hired 285 managerial grades personnel in 1986
- Received 1000 MTO applications every year
- Total intake was 15-20 people for the program
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Turnover rate was less than 5% in 1986 however it varied over the years.
PROBLEM IDENTIFICATION
The issues in the case are categorized as below:
- Interviews being postponed
- Probation period was too long i.e. up to a year
- Turnover rate varied over the years
- Frustration in candidates due to lack of permanent absorption after training duration completion
- Lengthy duration of training itself
- Too many test
- Takes too long to make the final selection due to lengthy procedures
- No questions in the test battery relevant to academic arena
- Uncertainty of permanent absorption after training
- Content relevance of the program was questionable
Matrix Organizational Structure is the root cause of the flaws in the MTO program of ICI
- Justification of core Issue
There are several justifications which can support the issue identification. Some of the crucial ones are listed.
- To begin with, it is not always necessary that among the host of problems only one would be the core issue. In fact, at times, these bunch of problems are branching out from one core issue and thus when amalgamated backwards leads to that particular problem. Same applies to the case under consideration. Matrix organizational structure is believed to remove the disadvantage of functional and a product structure as it is formed by dividing the organizations along both the lines. However it is not error free as well. If not practiced cautiously and rightly it can lead to grievous results in various arenas as it is happening with the training procedures.
- The training process i.e. the process of teaching employees the skills they need to perform their job has five basic steps:
-
Need Analysis⇨ where specific need assessment is done i.e. what sort of skills are needed or the need for trained personnel
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Design ⇨ where content and procedures are developed
- Validation
- Implementation
- Evaluation
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From the very basic step i.e. Need Analysis ICI is facing problems. The organization is unable to assess the personnel needs properly and thus in turn management trainees after the year end are not retained as mentioned in the case. The case clearly states that “Vacant management slots also affect the candidate’s absorption” hence pointing to the fact that if appropriate need assessment of management slots would have been done, the cost, time and effort invested in non-retained trainee’s would have been saved. However it is not happening.
- This lag in planning is stemming from the Matrix Organizational Structure. The company adopted the matrix structure yet was unable to weed out its disadvantages i.e. breakage of chain of command unity and the resultant confusion. No proper personnel’s planning is predicted due to cross-communication among product and functional division.
-
Several layers of management further complicate the situation. The layers add to the length of the training procedure, a major issue. Just an approval for management personnel requires a series of 5 steps:
- Each area submits its proposal to HR department identifying man-power requirement & financial implications of the new post.
- Proposal incorporated in ARD which contains budget targets
- ARD is approved by Executive board
- Approval DID NOT authorize recruitment
- After that explicit approval was needed
Thus this decision making process owing to multiple layers and the fact that 61% of the shares are held within the company, is a convenient explanation of the long time duration of the training process.
- This trickle down to the selection procedures further where again candidates have to go through a series of tests, exams and interviews before the final selection is made. Due to two bosses implication and layered structure this was unavoidable. As the case states:
“There are too many tests and interviews and it takes too long to make the final selection”
- Due to this mismanagement in planning and delay in selection frustration and uncertainty is likely to prevail in the training candidates-- a sheer toxic for their motivation levels, which is also an issue. Trainees, in such ambiguous situation are likely to work half heartedly towards the training session’s deteriorating the quality of the personnel in the long run, hence killing the aim of the ICI training program there and then. This can be a reason why ICI is facing a 5% turnover rate in management personnel as compared to the 3% turnover in non-management personnel.It is truly said,
Motivation will almost always beat mere talent
- Instructional designs mainly display an outline of how the training will work. From time duration to test batteries and to the content in training all flow from this very design. The facts in the case support the stand time and again:
“Issues of content and relevance of training to subsequent job assignment remained alive”
“There was some problem either with the selection method or with the training program of the company”
“Nobody throughout the exams, tests or interviews asked me any questions about engineering or computer programming which were my academic interests”
Such conflicts in design can come when there is some ambiguity in what the company actually needs in its management personnel. A product manger could convey a different requirement to the HR department while a functional manage would expect a different skill set in his employee. Hence, the confusion and conflict of interest, comes into play which is a major disadvantage of Matrix Structure.
- Graphically represented it can be shown as follows:
SOLUTIONS
Taking into the above scenario following solutions could be proposed along with their evaluations:
- Problem can continue to prevail or get worsen
- Increased loss of potential candidates
- Increased costs in terms of money, time and energy
- Demonization among individuals
- Minimize time duration for recruitment process
- More participation from candidates
- Better pool of candidates
- Cut on monetary and time costs
- Redesign the test by including technical questions in addition to the cognitive ability tests
- Lengthy test material
- Technical department needs can be judged more accurately
- Fair decision on the previous knowledge and past experiences could be made
- Re-structure organizational hierarchy with major focus on human resource department
- Job enrichment will lead to motivation in employees
- Job-sharing could be done
- Time saving due to delegation of decision making power
- Provide up-to-date feedback to the candidates
- Sunk cost for the organization
- Relaxation to candidates
- Create awareness among candidates of what they are lacking hence meeting the aim of civil service
- Let the candidates search for better opportunities if not recruited, instead of waiting fruitlessly
- Good word of mouth for organization
- Increase functional wings by diversifying career tracks through MTO program
- Job enlargement can inject motivation
- More areas to apply for a candidate
- More room for training candidates with clearly defined skill set
- Increased costs
- Time consuming
- Use More Accurate Personnel Forecasting and Better Training Designs By Effectively Using Matrix Organizational Structure with Decentralization Of Decision Making
The best possible solution would be to
“Use More Accurate Personnel Forecasting and Better Training Designs by Effectively Using Matrix Organizational Structure with Decentralization Of Decision Making”
This solution is proposed on the following grounds:
Combining all three aspects can weed out the whole problem entirely otherwise the core problems will persist in one way or the other.
- By accurate personnel forecasting ICI
- Can cut its time, money and energy invested in personnel which are not retained due to lack of vacant slots
- Can reduce de-motivation among candidates
- Can lessen the uncertainty among the trainees and the organization
- Can lead to positive and professional long term repute among the prospect candidates and in the industry
- By introducing better recruitment procedures such as inclusion of technical questions, role-playing, relevant test battery etc ICI
- Can cut its time, money and energy invested in personnel which are not retained due to lack of competency
- Can evaluate and select better and fairly judged candidates
- Can meet the criterion more effectively as prescribed by the department
- Can train individuals with relevant skill sets
- Can cut the duration of training short by focusing on major areas of interest
- Can create positive word of mouth
- By decentralized decision making ICI
- Can shorten the whole training procedure which otherwise took too long
- Can increase motivation among participants and the current employee
- Can avoid confusions and lengthy chain of command among departments and HR personnel
CONCLUSION
ICI – a market leader and a business giant, experienced issues in its MTO program. If evaluated methodologically and cautiously, one can identify the problem and develop a possible solution, as proposed above. However proper planning, implementation and evaluation is necessary for every organization in every aspect—whether it be a Business Guru Firm or a small SME. Most important of all, the hope, inspiration and motivation to be the best is all the force needed. It is rightly said,
“”
APPENDICES
Exhibit 1:
Exhibit 2
Exhibit 3
Exhibit 4
REFERNCES
-
Dessler, G. (2008). Human Resource Management. India: Dorling Kindersly (Pearson).
- Human Resources at ICI (Paksitan) Limited, 05-217-87-1 (1987).
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ICI. (n.d.). ICI Pakistan Limited. Retrieved October 08, 2010, from http://www.icipakistan.com/index.html
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Motivation Quotes. (n.d.). Retrieved October 09, 2010, from Thinkexsit.com: http://www.thinkexist.com/English/Topic/x/Topic_273_1.htm
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BIBLIOGRAPHY Reference for Business. (n.d.). Retrieved October 08, 2010, from Encyclopedia of Business, 2nd ed: http://www.referenceforbusiness.com/encyclopedia/Man-Mix/Matrix-Management-and-Structure.html
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Robbins, S. (2010). Essentials of Organizational Behavior. India: Dorling Kindersly (Pearson).