Assignment# 1

Strategic Management

PREPARED BY: KAVITA RAWAT January 28, 2014

HR Alignment with the Low-Cost-Provider Strategy

To attract the customers a firm sells its product at lowest possible price using a low cost provider strategy which can also be said price advantage. Thought using this strategy companies will earn low margin but it will increase their sale volume by introducing their product in the wide market to attract large number of price sensitive customers to gain a large market share. The organization I picked for this approach is McDonalds, further showing how it uses low-cost strategy and its implications on components of HRM which are showcased in the table below.

HRM FUNCTION 1. Recruitment and Selection

INSIGHTS
Use of external labour market such as using local job centers, carrier fairs or advertisement in restaurant. Planning Strategy-Availability and use of fringe workers (retired, temporarily unemployed or students) It uses fact bases decision making process for employee selection, it structured interview (job related questions) which helps them to predict the employees past behavior and it will influence the future performance. Recruitment by general advertises in the restaurant, referral of existing employee, online applications or internal promotions. Jobs are repetitive and narrow in scope so requires minimum training. Career paths are narrow so training is based on increasing efficiency in current job. Little or no investment in long-term development of the employee. Majority of trainings is on the job training and also attend class room training session for quality service and cleanliness. Source: (Selection Process)

2. Orientation and Training

 standardized criteria are used to evaluate the employees performance on basis of short term results 3. Performance Individual performance based evaluation on basis of Appraisal employees trait such as (honest and dependability) or punctuality, timely task completion, productivity or sales figure Immediate and specific feedback used to improve their performance which is usually one-way with little possibility for the employee to discuss the results Base pay for work and fringe benefits pay wages slightly below the industry norms i.e. Follow lag 4. Compensation strategy Short term incentives Pay and rewards on annual based performance and group rewards based on direct criteria of results-oriented Source: Belcourt and McBey, 2004

HR Alignment with the Differentiation Strategy

Firms aim to develop and market unique product and customer value for various customer segments to gain competitive advantage. Applying Differentiation strategy in a firms brings creativity, COMPETATIVE ADVANTAGE FOR sellers and unique and superior quality products for customers. New World Deli is an example of a differentiation strategy by providing exclusive choices of sandwiches and salads concentrating on the Pacific Northwest cuisine. The significance of differentiation strategy on HRM of New World Deli is highlighted in the table below.

HRM FUNCTION

INSIGHTS

1. Recruitment and Selection

2. Orientation and Training

3. Performance Appraisal

4. Compensation

Recruitment by word of mouth, graduate schools and employees referrals Appeals to highly skilled candidates Selection based on past experience, creative ability tests, versatility in work attitudes and work in teams. emphasis of training is on both skills and attitudes Facilitates generation of new ideas and procedures. in the training program Customers and cross-functional teams are also included Provides Off-the-job training. in another division or country the value of work is recognized & encouraged long-term performance appraisal Based on employees behavior Performance Evaluation is based on a combination of individual and group criteria, sometimes corporate Use of 360 evaluations- include feedback from employees, functional experts, associates and often customers Internal equity is of greater concern than external equity. great opportunities for high incentive pay but initially Pay rate is slightly below average market rates Compensation is added in the salary and incentives in form of bonus or store credit compensation package includes Pay for performance based on individual, group and corporate success

Source: Belcourt and McBey, 2004

SMART Objectives
______________________________________________________________________________ 1. Product quality is our number one priority Primary strategic objective is to provide quality and safety by mean of strong governance and management programs to promote high standards in product safety and quality. Regular monitor of customer compliance and report to quality department, use of appropriate technology to test the product or packaging to ensure up to the mark quality of the product by focusing on material and ingredients quality. (qality mission)

2. Every customer will be a satisfied customer Offering Better customer satisfaction by offering best service experience and providing prompt and responsive service with reliability and honesty. Yearly review on Maintaining product quality, on-time delivery and providing after-sales services to ensure customer satisfaction. 3. On-time delivery is our commitment to our customers Providing accurate, continuous and guaranteed just-ontime delivery Maintaining record of production deadlines, monthly review sales volume and customer in order to ensure on-time delivery to the customers.

SWOT Analysis
______________________________________________________________________________ Royal Bank of Canada (RBC) Royal Bank of Canada provides diverse financial services offering wealth management, personal and commercial banking, insurance market services and investment banking. its headquarters is in Ontario, Canada and in fifty other countries. SWOT Analysis- RBC Bank STRENGTHS North Americas Leading diversified financial service company and Canadas largest bank as per its assets and market capitalization Major presence in the US with 2,100 financial consultants and top five Giltedged market maker in UK Strong balance sheet providing resilience to adverse market developments OPPORTUNITIES Successful Acquisitions and regional expansion improved the revenue and profit margin Aging population (baby boomers) likely to increase opportunity and demand for retirement services and insurance market in Canada Positive Canadas economic prospect with increasing demand for commodities and improving global financial market conditions to lead in term of GDP growth WEAKNESSES Lower provision of credit losses (PCL) to hide the weakness in profitability Growth and profitability concerns at US operations as revenue declined by17.3% over 2009

THREATS Financial service demand may can effect by increase in interest rate for financial services business prospects are likely to effect by increase in regulatory activism comparatively high taxation than OECD countries which is impacting profitability

Source: (Royal Bank Of Canada SWOT Analysis)

5

HR as a Strategic Contributor to an Organization

1) HR contributes to the organization by enacting the companies strategy by focusing on HR plans to achieve the organizational goal. It role is to identifies the companys strategy and then position the HR functions with strategic imperatives to facilitate solution and valuable inputs. To improve the capabilities of the enterprise in order to execute its business strategies is the main the function of HR. 2) To gain competitive advantage for the company HR raises the companys human capital to advance and innovative levels. The major role of Human Resource Management is to design such organizational culture that focuses on meeting the needs of external customers. To get the desired business outcomes it makes use of culture to align management and employee behaviors (Meisinger, 2003) 3) HR another role is to support an organization by managing Human CAPITAL which is major requirement of organization strategy through focusing on every part of HR function such as recruitment and selection, training and performance appraisal need to be developed. 4) HR recognizes corporate strategy related problems, provides alternative ideas and brings a logical viewpoint to the process, which is done by taking an effective stand, providing informed opinions about the future of the business, and by acting as an advocate (Meisinger, 2003).
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5) Keeping employees linked to the marketplace is also a role of HR through implementation of in-depth training and development plans.

HR is not a Strategic Contributor to an Organization

_____________________________________________________________________________ 1) HR is said to be a personnel expert, and not business expert because of incomplete understanding and knowledge of business. HR information is beneficial to its department only but does not work to make extensive business strategies and plan. 2) HR needs lot invests in training and culture development programs that doesnt pay off for years where as business management got short term focus based on current results and performances and for them investment which does not pay off for year is an expense. 3) The change bring by the HR can be resisted. HR program demands different ways of managing employee leads to new behaviors which is hard to tackle. 4) It is bit difficult to measure the outcome of HR programs as HR assets are not owned by the company and therefore, its a high risk investment to allocate resources to such programs. 5) Senior managers lack admiration for the role that they play in supporting and managing the business to achieve its goals because HR is considered as an adversary, demanding excessive bureaucratic work in the managers daily tasks. (Belcourt, 2004)

Works Cited
qality mission. (n.d.). Retrieved 01 2014, from coca-colacompany.com: http://www.cocacolacompany.com/sustainabilityreport/me/product-safety-and-quality.html#section-safety-andquality-in-every-serving Royal Bank Of Canada SWOT Analysis. (n.d.). Retrieved 01 2014, from marketingmix.org: http://marketingmix.org/swot-analysis-of-royal-bank-of-canada/ Selection Process. (n.d.). Retrieved 01 29, 2014, from businesscasestudies.co.uk: http://businesscasestudies.co.uk/mcdonalds-restaurants/recruiting-selecting-and-training-forsuccess/training-at-mcdonaldsrestaurants-limited.html#axzz2rZ1DphUO Belcourt, M. &. (2004). HR strategic Planning. (4. edition, Ed.) Belcourt, M., & McBey, K. Meisinger, S. (2003). Strategic Contributor. Meisinger, S.HR Mazaine.