An organisation can simply be described as an arrangement of people in a systematic structure of jobs and authority, guided by processes, systems, policies and procedures to accomplish some specific purpose over time (Robbins et Coulter, 1996 was referenced in Human Resource Management, Amos et al, 2008:3). It is an open system because it does not exist and function in isolation but is influenced by external factors namely political, economic, social, technological, environmental and legal. The Nadler and Tushman Model is one that attempts to show what occurs in organisations when change occurs, and is known as the congruence model for diagnosing organisational behaviour.
The Nadler and Tushman Model
Informal
Organisation Outputs
Strategy Work Formal System
Organisation Unit
People Individuals
Source:Nadler and Tushman, 1997: 38
The 8 S’s Model
Higgins’ 8 S’s Model is a management model that shows that in order for strategies to be successfully executed key organizational factors have to be aligned with these strategies. The model shows that it is plainly not enough to have all resources present and have brilliant strategies put in place, but use inappropriate strategic actions to carry them out.
The S’s represent the key organizational variables which must be aligned, namely strategic purposes (vision, mission, goals, strategic objectives), structure (jobs, authority, the grouping of jobs, span of control, and methods of coordination), systems and processes (information systems, quality systems, capital budgeting systems, etc.), leadership style, staff, resources (people, technology, money), and shared values (corporate culture) (Management, Hellriegel et al; 2008: 14). And when all of these are aligned they lead to strategic performance.
The 8 S’s Model
Structure Systems and Processes
Strategy and purposes Shared Values Style Strategic Performance
reSources Staff
Source: J. M. Higgins. “The Eight ‘S’s of Successful Strategy Execution”, Journal of Change Management, Vol. 5, No. 1, P.6 but the diagram is in (Management, Hellriegel et al; 2008: 14).
The Storey Model
The Storey Model essentially distinguishes between hard and soft systems of human resource management. In the hard approach a very practical way of doing things is observed, with people being seen as a passive resource to be used, deployed and if necessary disposed of. Here the links between business and HR strategies and the importance of a tight fit between the two are stressed. In the soft approach, however, the focus is on the management of people, who are viewed as valued assets and a source of competitive advantage through their skills and abilities. Within this conception of HRM, there is one best way to manage staff, and this requires managers to engender commitment and loyalty in order to ensure high levels of performance (Storey, 2001: 6)
Kearns Model
One of Kearns Models shows that HR strategy is a strategy and not just a set of HR policies and procedures. It also sets out to get businesses to consider the full human implications of its business strategy and to ensure that the human resources function and business strategies become homologous.
The Ulrich HRM Competencies Model:
What Dave Ulrich found was that with globalisation and the changing world HR professional are finding themselves in unfamiliar territory and for them to be able to respond to these changes they must demonstrate new competencies. Ulrich suggested four competencies:
- Knowledge of the business: Human Resource professional must understand how their business works, which includes an understanding of the organisational strategy, how the organisation makes profit and achieves its goals, knowledge of every aspect of the organisation.
- Knowledge of “best practice” in HR also called HR Delivery: Human resource professional must continue to better themselves and the skills they offer the organisation
- Change Management Skills: with the changing environment faced by organisations, Professionals are required to be adaptive and transform themselves internally to meet challenges and needs. Since change involves influence and motivating others to move forward and positively with the change, HR professionals must have the skills to help line managers achieve this transformation.
- Personal Credibility: the HR professionals need to act in ways that show competence, integrity, accountability, confidentiality and related ethical qualities to win the hearts, trust and respects of those they lead.
Ulrich Competencies Model
Whittington’s 1993 generic perspective on Strategy:
Strategy is used to enable an organisation to achieve its organisational goals and objectives and also to achieve a competitive advantage with its uniqueness of the service or product it offers by focussing on the present and future direction of the organisation. Whittington (1993) presents four generic ways to strategy formation along to dimensions of “processes” and “outcomes of strategy” shown in appendix D. The “x” axis in the diagram deals with “the extent to which strategy is formed in a rational, formal, planned and deliberate manner, whether it is a result of bounded rational approach or is emergent in nature. The ‘y’ axis relates to the extent to which organisational strategy focuses on profit-maximising outcomes” Budhwar & ARyee (2000), Lundy & Cowling (1996). Organisations who found adopting the classical approach practice a clear, rational, planned and deliberate process of strategy formation and aim for maximisation of profits. The Evolutionary Approach, organisations find themselves in unpredictable and dynamic environments where it is not possible to adopt the Classical approach practice, the “key to success thus largely lies with a good fit between organisational strategy and business environment” Budhwar & ARyee (2000). The approach is different on the profit-maximisation perspective where managers are not clear about what the ‘optimum’ level of output is or should be, there is a high level of confusion with the organisation and the in the Market they are in. Therefore, this results in strategy being formulated as the organisation progresses. Lastly there is systemic approach which puts emphases on social factors, demographic composition and national culture in which the organisation is operating (Legge, 1995).
Whittington’s (1993) generic perspective on strategy
Research Methodology
We went to the Nandos branch in Grahamstown and conducted a face to face interview with Mr Khaya the branch manager. He answered questions from a survey based on the Ulrich Model; we chose this model for its simplicity to construct a vivid illustration of the current role of HRM as well as its practicality. It allowed us to diagnose which areas the organisation is strong in and which ones needed improvement and those that were completely lacking. From there we took the results from the survey, then looked at the various components of the Nadler and Tushman model and compared and contrasted to be able to gain a deeper context of whether there was congruence the HRM function within the organisation. Being in the store also gave us an opportunity to observe the relationships and the hierarchy of authority and just generally the ambience in the store.
Findings
Nando’s International is an international food franchise organization that was started in 1987 from the successful Nando’s brand in South Africa to take advantage of the opportunities offered by taking the brand international. In 1995, the company had grown to 45 outlets in South Africa with additional 17 in other southern African countries, Namibia, Botswana, Zimbabwe and Swaziland, (Nando’s: 2012). From our findings and research, we found that Nando’s International does not yet have a formal HR strategy although key elements of such a strategy are present. The lack of HR strategy is a product of the recent history of Nando’s International global expansion, the nature of the industry and the franchise relationship. Each country can interpret their own strategy judging from their own local conditions. From the perspective of the systems and strategy theory, it is critical that managers have a clear sense of what makes the organisation successful and that they understand the role of HRM in contributing to this success.
From the research we did on the current role of the Human Resource Management (HRM) function with the HR manager of Nando’s Grahamstown, Mr Khaya. The manager accepted that competitive advantage of Nando’s does not lie in the quality of their food alone but also in the people of the organisation, (human resource capability and commitment) and how they are managed. Mr Khaya added that the business cannot function at full capacity, cannot produce quality food or provide a quality service to its customers if people problems are not dealt with. With regards to the HR function of Nando’s Grahamstown there is a strong application of the Kearn’s Model approach to HR function in the sense that people are generally seen as a competitive advantage and this means that Mr Khaya is operating above the line.
The people of any organisation are a source of competitive advantage. However, for this to be realised, the organisation requires HRM capability. According to Bartlet and Goshal (1997), HRM capability refers to the HRM function within the organisation as well as the ability of management to manage productively and realise the potential within the people of the organisation. Those managers most likely to succeed do not only set up an effective HRM system to support the achievement of business objectives but also have an informed understanding and ability to manage the human aspect of human aspect of the business. While personally able to manage individuals and group, they also ensure that others in management position are able to manage people with the support of HRM systems and processes. Mr Khaya stated that he understands that committed people make Nando’s an effective organisation and that an effective organisation have the best chance of profitability. This is aligned with the service profit chain of Hesket which makes the case that they way to generate enduring revenue growth and profit is to build the kind of working environment that provides internal service quality to its people, resulting in employee loyalty and productivity and their rendering of external service quality to customers. The service profit chain illustrates how the employees of the organisation are central to attracting and retaining customers and therefore ensuring organisational success (French and Bell, 1995).
Mr Khaya mentioned in his interview that the nature and role of the HRM function at Nando’s has moved from the traditional function which is defined by Bartlet and Goshal (1997) as personnel management. Personnel management was seen as a separate function disconnected from the actual work of the organisation, providing only an administrative, rule-making and regulating service to the organisation. At Nando’s there is now pressure on the HRM role and function to become fully integrated with the other functions such as finance, marketing and production and to legitimise itself in ensuring the direct contribution of people to achievement of strategic business objectives.
According to Bartlet and Goshal (1995), the central focus of the HRM should be on the investment in a management of the talent of employment, through viewing them as talent investors and according them the status of partners in the organisation who should be rewarded in the same way other investors are. The new role of HRM requires that it should create sustained competitive advantage and thereby add measurable value to the organisation by delivering bottom line business results and adding value for customers, shareholders and employees. Ulrich (2001) and others illustrate how this can be done by referring to the use of the HR architecture as a strategic asset. The HR architecture consists of 3 components, the HRM function, HRM system and the employee behaviours. These combine to create and HR value chain.
As stated earlier, Nando’s international doesn’t have a standard HR strategy. When we interviewed Mr Khaya, he bragged about how Nando’s Grahamstown HRM formulated and implemented their own HR strategy that suited their own working environment. This is in line to what Ulrich said about how one of the roles HRM function needs to fulfil is a strategic partner.
In the past years the roles of HRM on an organisation were often viewed in terms of transition from operational to strategic, internally focused to externally and customer-focused, reactive to proactive. However these are now seen as too simplistic, as the roles undertaken by HR professionals in reality are multiple and not single (Ulrich, 1997:24).
We found that managers need to learn to be both strategic and operational, focusing on the long term and short term. There are certain activities that the role of HRM practices in building a competitive organisation, these activities range from managing processes (HR tools and systems) to managing people (Ulrich, 1997:25).
It was found that they are four principal HR roles:
Management of strategic human resources: This focuses on aligning HR strategies and practices with business strategy. Here the role is for the manager to be a strategic partner, helping to ensure the success of business strategies. This role usually increases the capacity of a business to execute its strategies (Ulrich, 1997:26).
Management of firm infrastructure: This requires that HR professionals design and deliver efficient HR processes for staffing, training, appraising, rewarding, promoting, and otherwise managing the flow of employees through the organisation, when this role is accomplished successfully it adds value to a business. Here the role is for the manager to be an administrative expert; meaning can dig out unnecessary costs, improve efficiency, and constantly find new ways of doing things better (Ulrich, 1997:27).
Management if the employee contribution: This role encompasses the involvement in the day to day problems, concerns, and needs of the employees. Managers become employee champions by linking employee contributions to the organisations success. They spend time with employees and train and encourage managers in other departments to do the same (Ulrich, 1997:30).
Management of transformation and change: The transformation entails fundamental cultural change within the firm, and change refers to the ability of an organisation to improve the design and implementation of initiatives and to reduce cycle time in all organisational activities. Managers play the role of being change agents through honouring the past by appreciating and respecting tradition and the history of a business while acting for the future (Ulrich, 1997:31).
The HR role-assessment survey we gave to the Nandos Branch Manager,Mr Khaya, provides a view of the current overall quality of the HR services and also an assessment of the evolution of a business HR services. Based on our results we found that the Nandos HR system focuses on employee contribution, followed by firm infrastructure, and they view the roles of transformation and change, and strategic human resources the same.
With regards to Nandos HR role focusing mostly on employee contribution, this shows that they take care of employees personal needs, work on improving employee commitment, set HR policies and programs so that they respond to the personal needs of employees, they help employees meet their personal needs, and wherever possible they offer assistance to help employees meet family and personal needs.
However with reference to Nadler and Tushman model, there are four organisational components that impact on the four roles, Namely;
Task-which deals with the activities an organisation is engaged with usually in light with strategy, it is the basic and inherent work to be done by the organisation and its parts, the types of skill and knowledge demands the work poses, the types of rewards the work inherently can provide, the degree of uncertainty associated with the work, including factors such as interdependence, routines, the constraints on performance demands inherent in the work (Nadler and Tushman, 1997:118)
Individual: These are the characteristics of individuals in the organisation; the knowledge and skills of individuals; needs and preferences, perceptions and expectancies, and background factors (Nadler and Tushman, 1997:118).
Formal: The various structures processes, methods, that are formally created to get individuals to perform task, organisation design, including grouping of functions, structure of subunits, and coordination and control mechanisms, Job design, work environment, and human resource management (Nadler and Tushman, 1997:118).
Informal organisation: The emerging arrangements including structures, processes, relationships. Leader behaviour, intragroup relations, intergroup relations, informal working arrangements, communication and influence patterns (Nadler and Tushman,1997:118)
The component task is likely going to affect the management of strategic human resources as this usually helps to ensure the success of a business strategy and therefore the activities Nandos is engaged with are most likely going to affect the success of the strategy. As the activities have to align with the strategy.
The individual component is likely going to affect the employee contribution of the organisation as different individuals have different skills, needs preferences and perceptions of things, therefore while Nandos is aiming to practice the role of employee contribution it has to take in account each person individually.
The Formal organisation impacts on the management of the firm’s infrastructure, this helps in building an efficient infrastructure by reengineering organisation processes. Nandos has an efficient infrastructure that helps individuals perform as the tasks they are required to.
Lastly the Informal organisation impacts on the management of transformation and change, this is because the actions of change agents include identifying and framing problems, building relationships of trust, solving problems and creating and fulfilling actions plans. Nandos HR professionals will need to understand critical processes for change build commitment to those processes and ensure that change occurs as intended.
Limitations
- Nandos Grahamstown is a small branch and therefore the HRM function will not be as visible as other functions.
- The sample size of employees is limited; therefore we cannot observe the entire scope of the role of HRM as compared to other larger companies.
- The role of HRM across Nandos branches is not standardised as each manager adopts its own role, therefore it may be difficult to see the net effect as one cannot compare.
Recommendations
- The branch Manager, Mr Khaya should ensure continuous training of his staff to ensure low staff turnover.
- He should ensure the Performance Management System is appropriate for their situation and is able to deal with all the branch issues.
- The branch is small enough to ensure that people feel valued through endeavours such as employee of the month.
- It is easier to enrich the employees jobs as they can rotate more often and learn all the tasks to be done in the restaurant thereby enhancing their skills with on the job training and ensuring that a pool of skilled employees are available if one falls sick. Counteracts the effects of absent employees as well.
- They can also move from being employee champions to administrative experts or change agents as in the modern world infrastructure and change is what is very important in most organisations.
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