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Human Resource Management

This purpose of this study was to examine the change and development of human resource department as a whole and innovation in HR policies and practices in large and successful organisations. For this purpose, literature on four such organisations namely, Marriot Hotel, Marks & Spencer’s, The Inland Revenue and TESCO PLC shall be gathered along with a series of interviews to gain valuable insights. The role of the human resource department is undergoing drastic changes. In the recent past, many organisations thought of the human resource department as simply a support service to the “real” operations departments of the firm (Buhler 1999).

They dispensed pay checks and ensured employees were kept abreast of any changes in their health care benefits. This is obviously an outdated perspective of a critical resource in all organisations today. In not so distant past Human Resources (HR) was largely an administrative role responsible for assisting employees with personal problems and health benefits, organizing the annual staff Christmas party and on clean-up duty after a situation with an employee went awry (Lochbihler 2006).

Enlightened organisations now respect and value Human Resources Management (HRM) for their key leadership role as long-term strategic business partners. Interestingly enough, two trends are

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at play with the human resource departments. The departments themselves are becoming smaller. Yet at the same time, the organisation-wide influence of the department is definitely increasing (Refer to Appendix: Table 2). The HR departments today are emphasizing “higher-value activities” with company wide benefits that add value to the organisation (Buhler 1999).

This shift has been described as one from a “micro view” to one of a “macro view” of the department’s role in the organisation. Most organisations have recognized the increasing importance of human resources and have signalled this to the organisation by including the top ranking human resource executive in the dominant coalition of the firm. That is, there is usually a vice president of human resources that sits with top management from all the other functional areas of the firm and assists in determining the strategic direction of the company (Buhler 1999).

This is a critical move for organisations since the human resource strategy must be closely aligned with the overall strategy of the organisation of the firm to ensure success. In addition, all the functional level strategies must be closely aligned. With this alignment of strategy, the human resource department can then better partner with managers throughout the organisation to help meet corporate wide objectives. If these two strategies are not closely aligned, the firm will find itself pulling in different directions and not making any progress toward meeting goals.

Through most of the 1990s, M&S was unchallenged as Britain’s premier high street retailer (Merriden, 2000). Following the recession of the early 1990s, it enjoyed seven fat years of profitability, achieved through an unparalleled reputation for quality and good customer service, a successful diversification into the quality food market and relentless downward pressure on its suppliers’ profit margins. Its subsequent downfall, therefore, came as a surprise to outsiders, but things rarely go wrong overnight in a large company like M&S.

Those at the head office admit that the writing was on the wall for many months before profits started their nosedive (Merriden, 2000). Even as M&S urged suppliers to cut costs, it completely failed to keep an eye on its own. The head office became overstaffed and bureaucratic, and the connection between customers and senior decision makers became increasingly obscured by middle managers. Things began to go seriously awry in mid-1998, when sales figures were disappointing in both the clothing and food sectors (Merriden, 2000).

Amazingly, the M&S board immediately concluded that the UK retail market, rather than just their company, was about to suffer a major downturn. Sales were particularly disappointing in the UK, M&S’ main market. While revenues have been more or less constant, the company had greatly increased its buying volume for the autumn 1998 and spring 1999 clothing lines, based on extremely positive assumptions about trading conditions.

M&S had also expanded its floor space by nearly 1 million square feet (or 9 percent) following the acquisition of a competitor’s stores (Merriden, 2000). But when sales failed to materialize, M&S hastily reduced forward orders of goods. This damaged the balance of inventory because as popular goods sold out, the company lacked the usual injection of fresh merchandise and still had to clear unsold goods. The result was exceptionally dreary stock on the shelves (Merriden, 2000).

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