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Institute of Personnel Management Sri Lanka

NAME OF THE PROGRAMME : Professional Qualification in Human Resource Management


TOPIC OF THE CASE STUDY : Strategic Human Resource Management
MODULE NUMBER : Module - 10
NAME OF THE LECTURER : Mr. Terence Perera

Name of the Student G. Iresha Nadeeshani

Index Number PQHRM/KR/06/36

Contact Number 0713808594

E-mail Ireshanadeeshnai072@gmail.com

Date of the Examination 07/05/2017

Date of Submission 14/05/2017

For Office Use Only:


LATE SUBMISSION
1. Final Marks : ..
2. Remarks : .. NO OF DAYS
3. (To be filled by the Examiner)
Executive Summary

The MJF Groups origins date back to the 1950s just after Sri Lanka, then Ceylon, became independent
from British colonial rule. Founder of the Group, Merrill J. Fernando has devoted a lifetime to tea, the
core business of the Group. He had his early tea training in Ceylon and then in the Mecca of tea, Mincing
Lane, London. Challenging the system that prevented him from marketing Ceylon Tea packed at origin,
Merrill returned to Ceylon determined to change the structure of the trade. That took him almost 25 years
and in 1974 he established his own company MJF Exports Ltd. That company was the first of a series
of ground-breaking companies that today form the MJF Group.

Merrill heads the family managed Group to this day, with his two sons and a dedicated team of
professionals. The Group retains Merrills early emphasis on his vision for bringing quality back to tea
and his commitment to integrity, tradition and personalized customer service. The Groups Dilmah
brand, coined by the Founder from the names of his two sons, Dilhan and Malik, is known for its quality
in over 100 countries around the world. Dilmah has revitalized a category in decline through genuine
innovation, quality and freshness and is widely credited with halting the trend towards commoditization
in tea.

In pursuit of excellence, Merrill has established the most integrated family tea business in the world with
ownership or investment in plantations, printing and packaging, tea broking, import & distribution of
equipment & materials for the industry all with a single focus, the worlds finest cup of tea. The
Groups flagship tea brand, Dilmah, has re-established Ceylon Tea as the finest on earth.

Through his MJF Charitable Foundation, an NGO and recognized Charity, the Founder distributes much
of his wealth to his staff & workers and to underprivileged persons in Sri Lanka. The Foundations key
objectives include the improvement of medical and educational facilities for over 30,000 workers and
their families on MJF Group plantations, and the approximately 1,500 staff and workers in its trading
and production activities.

In 2002, the BBC described the Company in World Business Report on BBC World,

A Sri Lankan family tea company is challenging the multinational control of the global tea industry.
Dilmah says it has become the third largest global tea brand by marketing its pure unblended Ceylon tea
directly to the consumer in more than 80 countries worldwide. The idea is to revive the image of Ceylon
tea as the best and most expensive tea in the world.
1. "Differentiation induces buyers" Explain. How do you contribute to beat the
competition as a HR Manager in this company?

Differentiation relies on the concept that customers will pay more for an item if they perceive that it is
different and if the basic for the difference is valued by the customer.

Differentiation involves achieving competitive advantage through pinpointing product or service


attributes that customers perceive as valuable and positioning the firm to meet those demands betters
than the competition.

It refers to -
"Creating something that is perceived industrywide as being unique. Approaches to differentiating can
take many forms: design or brand image, technology, features, customer service, dealer network, or other
dimensions" (Michael E. Porter).

Differentiation has several potential advantages:

- Differentiation provides insulation against competitive rivalry because of brand loyalty


by customers and resulting lower sensitivity to price.
- It increases margins, which avoids the need for a low-cost position.
- It can provide entry barriers for competitors as a result of customer loyalty and the need
for a competitor to overcome the product or service uniqueness.
- Differentiation yields higher margins with which to deal with supplier power.
- It can mitigate buyer power because there are no comparable alternatives.
- The firm that has differentiated itself to achieve customer loyalty should be better
positioned vis-a-vis substitutes than its competitors.

This strategy - "The low cost and differentiation strategies are aimed at achieving their objectives
industrywide, the entire focus strategy is built around serving a particular target very well, and each
functional policy is developed with this in mind" (Michael E. Porter ).

The focus strategy has two variants:


Cost focus
In cost focus a firm seeks a cost advantage in its target segment. Cost focus exploits
differences in cost behaviour in some segments.
Differentiation focus
In differentiation focus a firm seeks differentiation in its target segment. It
exploits the special needs of buyers in certain segments.

Therefore, the firm achieves either differentiation from better meeting the needs of the particular target,
or lower costs in serving this target, or both.

Overall differentiation and differentiation focus are the most often confused strategies in practice. The
difference is that the overall differentiator bases its strategy on widely valued attributes, while the
differentiation focuser looks for segments with special needs and meets them better.

Both variants of the focus strategy rest on differences between a focuser's target segments and other
segments in the industry.

If a firm can achieve sustainable cost leadership (cost focus) or differentiation (differentiation focus) in
its segment and the segment is structurally attractive, then focuser will be an above-average performer
in its industry. How to define segments and choose a sustainable focus strategy is described in section
"Industry Segmentation."

Which generic strategy is a chosen is a function of the firm's strengths and weaknesses combined with
the competitor's positions in the market.

However, Porter suggests that, whatever strategy is chosen, the firm should try to maintain "parity" with
its competitors. Therefore a differentiator should not completely forget price and a low-cost producer
should not forget quality.

Porter argued that there is fourth state of affairs in business-level competitive strategy; he labelled it
"stuck in the middle" It is not a deliberate strategy per se. Rather, it is the result of not being able to
successfully pursue any of the three generic strategies. The result of not having the lowest costs, not
being really differentiated in the minds of the consumer, or not successfully targeting a market segment

results in a weak profitability and market picture. The firm stuck in the middle is almost always
associated with lower profitability and mediocre market share. The firm stuck in the meddle must make
a fundamental strategic decision.
As a Hr Manger in Dilmah Tea Company I try to make diffrentiation of buyers as a competitive
advantage.

Dilmah is the third largest tea brand in the global market. If a company in a global market, they always
expect changes in their products. Like quality. Packaging, colour, etc.

As a HR manager, we can used to following things to beat the competition,


We can use Sri Lankan Heritage to promote the tea products.
We use the brand persons to promote the tea products.
We can improve the quality of the products by well-trained labours adding to the factory.
Give a knowledge for them.
We can do CSR activities to promote our products. It will be help to improve good will
of the company and also market profit.
2. With a view to redefine Dilmah Tea as the "Best and most expensive tea in the
world" Write a report to CEO, on role of you as a strategic business partner.

A Sri Lankan family tea company is challenging the multinational control of the global tea industry.
Dilmah Tea Company has become the third largest global tea brand by marketing its pure unblended
Ceylon tea directly to the consumer in more than 80 countries worldwide. The idea is to revive the image
of Ceylon tea as the best and most expensive tea in the world.

The tea trade has become dominated by a few giants who buy up bulk tea from around the world and
blend it together, losing the distinctive flavour of different regions. If we look Delmah Tea Company a
view of strategic business partner they used lot of strategies to become the best and most expensive tea
in the world.
- Dilmah produced the result is freshness and quality have been sacrificed to low cost and
uniformity.
- Manufacture & export of tea; in pre-packaged, branded form.
- Printing & packaging for tea and other industries.
- Tea, coconut, spices & rubber estates and broking.
- Real estate and property development.
- Import and distribution of packaging machinery & material.
- Investment & private portfolio management.
- Establishment and management of boutique leisure properties
- Improving the quality of life in the community with an emphasis on children & the
elderly, especially on their estates
- Growing concern
- Unique is that it boasts it sells the freshest tea in the world
- Focus on Consumer's choice
3. Write a speech that will be delivered in a HR Forum under the caption "A
Happy employee".

The employer-employee relationship is one of modern days most important relationships. When the
match is good, the result for the employee is higher personal fulfilment, creativity, and productivity,
which ultimately benefit the employer. When relations go sour, the stress on an employee can be
crushing and the impact on workplace morale can spread.

So critical is this relationship that mobile apps, developed by companies such as Good.co and Plasticity,
are using sophisticated personality tests and surveys to help boost workplace happiness, whether that
means finding the perfect match between jobseekers and employers or helping companies better engage
and motivate workers. Employers are also increasingly recognizing the importance of strong corporate
social responsibility programs as a way to attract and retain top talent.

There is no shortage of research linking mission-driven work to happy workers. But a company cannot
simply advertise itself as socially and environmentally responsible and expect to reap the human
resources benefits. The ethos of the company has to percolate through the entire organization to ensure
employees are happy and that they stay that way.

To make achieving happiness critical to every companys success.

Happy employees are more productive.


It results in less employee absenteeism, burnout and stress. When employees are
happy, they are less preoccupied with themselves, more focused on their work
and are willing to take on new challenges.

Happy employees are better leaders.


They become more resilient, less risk adverse and can more easily bounce back
from failures.

Happy employees are more creative.


They are less worried about the day to day tasks and can dream of new
possibilities.

Happy employees are better team players.


They are more likely to help others and tackle the big issues confronting them at
work.
So how do business owners encourage happiness in their employees?
1. Recognize when employees are making progress.
Pause and highlight milestones that people hit or challenges they have overcome. Ensure that
people feel their contributions are rewarded by simply saying "thank you."

2. Make employees feel like they belong.


To be happy at work, its important to feel like you have a friend. This gets challenging
especially when the company gets busy. People need to feel like they know each other and so
time like this yields positive results.

3. Take an interest in who employees actually are.


One of the key questions that always gets asked in employee surveys is "Do you feel like your
boss cares about you and is trying to give you the tools to succeed? This will lead to employees
that are much more engaged at work.

4. Make it fun.
Organizations that feel light where people can joke around occasionally with each other have
stronger cultures. When mistakes happen, people can see the funny side and are not just focused
solely on the downside.

5. Let your employees disengage sometimes.


Many employees feel like they are always working because they have "a cubicle in their pocket
that they can never turn it off. This makes employees feel tremendously harassed and stressed.
Encourage times when employees are completely disengaged so they can focus on their family
and set their own personal priorities.

6. Encourage exercise and sleep.


Enough of both of these does great things for employees focus, attention, creativity, energy and
mood. In the long run, consistently doing "all nighters" are counterproductive.

7. Stop calculating everything.


As managers, stop keeping score every time an action is taken. Dont always be thinking, "If I
did this for an employee, they should do that. Do what is right and dont calculate.
According to this we can use following things to create happiness of employees in Dilmah Tea company.
So it will help to become the no. 01 tea company in the global market.

- Doing community health programmes.


- Helps to employees to start small entrepreneur programmes.
- Provide medical, legal and vocational support to its employees.
- Doing environmental education awareness programmes its employees.
- Improve welfare facilities its employees.
- Improve employee engagement.

We come into this world with nothing and we leave with nothing. The wealth some of us acquire is owed
to the efforts and cooperation of many others around us. Let us therefore share that wealth, while we are
still around, so that the goodwill and contentment created thereby, may make our world a happier place
for others too.
4. Discuss the significance of creating Knowledge Employee in the pursuit of
capturing of international market in tea industry.

All businesses have access to an extensive pool of knowledge - whether this is their understanding of
customers' needs and the business environment or the skills and experience of staff.

The way a business gathers, shares and exploits this knowledge can be central to its ability to develop
successfully. This doesn't just apply to huge multinational companies. Knowledge management can
benefit everyone from a local newsstand to a manufacturing firm.

Knowledge employee can be differentiated from other forms of work by its emphasis on "non-
routine" problem solving that requires a combination of convergent, divergent, and creative
thinking. But despite the amount of research and literature on knowledge work, there is no succinct
definition of the term.

It's essential to avoid important knowledge or skills being held by only a few people, because if they
leave or retire that expertise could be lost to your business. If you have efficient ways of sharing
knowledge across the business, it will be more widely used and its value and effectiveness are likely to
be maximised.
Knowledge sharing
Consider the best ways of sharing new ideas and information with your staff. You may
already have regular meetings when you can brief employees and ask them to share ideas
and best practice.
You could consider holding innovation workshops or brainstorming sessions at which
staff are given the freedom and encouragement to think of ways in which the business
could improve.
It can also be a good idea to create a knowledge bank containing useful information and
instructions on how to carry out key tasks. Putting this on an intranet is ideal as it will
encourage staff to post news or suggestions.

Knowledge management
Technology alone isn't the answer to sharing knowledge - it has to be managed carefully
so that information is channelled properly.
Incentives and training
Remember that offering staff incentives to come up with suggestions for how the business
can be improved is often an effective way of getting them to use and share knowledge.
Don't forget the importance of training in spreading key knowledge, skills and best
practice across your business.

According to this we can gain lot of benefits from creating a knowledge employee. And also we can win
the international market.
- Enabling better and faster decision making
- Making it easy to find relevant information and resources
- Reusing ideas, documents, and expertise
- Avoiding redundant effort
- Avoiding making the same mistakes twice
- Taking advantage of existing expertise and experience
- Communicating important information widely and quickly
- Promoting standard, repeatable processes and procedures
- Providing methods, tools, templates, techniques, and examples.
- Making scarce expertise widely available
- Showing customers how knowledge is used for their benefit
- Accelerating delivery to customers
- Enabling the organization to leverage its size
- Making the organization's best problem-solving experiences reusable
- Stimulating innovation and growth
5. Design different business strategies of five other departments under the
corporate strategy of 30% market growth of Dilmah Tea and discuss relevant
HR strategies to support them.

Finance
Strategy

Marketing
Corporate Strategy
Business
Strategy
Strategy Functional Operation
30% market Strategies Strategy
30% market
growth of
growth
Dilmah Production
Comapny Strategy

HR

Strategic Strategy

Human
Resource
Management

Corporate strategy is to improve 30% market growth of Dilmah. So business strategy of Dilmah is to
increase 30% market growth. So we have to separate business strategy for department policies to achieve
the corporate strategy.

1. Marketing Strategy

It means what are the strategies is use to promote and sell our products. In that case we should touch on
each of the "four Ps" of the marketing mix:
Product
o How does our product meet the needs of our target market?
o Ex- Change the product due to the differentiation of buyers
Doing innovations

Price
o How much will we charge for our product and why?
o Ex Use low cost pricing strategy to achieve the target

Place
o How are we going to get our product to our customers?
o Ex- Expanding the stores and also the market.

Promotion
o How will we connect with our target market?
o Ex- Doing promotional campaigns
Promote the brand name

2. Operation Strategy

Our business plan should outline our current operational requirements as well as our projected
requirements for the next 3 to 5 years and also to achieve the target. Our inventory management and
accounting systems should have the ability to produce up-to-date reports.

We can include:
Day-to-day operations provide a general description of the day-to-day
operations of the business, such as hours of operation, seasonality of business,
suppliers and their credit terms, and so on.

Facility requirements identify our requirements in terms of size and location.


Include any related documents in the appendix of our business plan, such as lease
agreements or supplier quotations. Detail any special requirements associated
with the facility and include any licensing documentation in your appendix.
Management information systems indicate how we plan to control stock,
manage accounts, control quality and track your customers.
Information technology (IT) requirements identify the IT systems we will be
using for our business. As this is a key factor for most businesses, indicate if we
are using a consultant or IT support service and outline any
planned IT developments.

We should also want to include our operations manual as an appendix to our


business plan. ( Day-to-day operations -Successfully managing the ups and downs
of daily operations is the backbone of our business.)

3. Finance Strategy

Our financial forecasts should include:

Cash flow statements this is a cash balance and monthly cash flow pattern for the first

12-18 months. Include working capital, salaries and sales.

Profit and loss forecast this is the level of profit we expect to make, given our projected

sales, the costs of providing goods and services, and our overhead costs.

Sales forecast this is the amount of money we expect from sales of our product and/or

service.

Things to consider:

- How much capital do we need, if we are seeking external funding?

- What security can we offer to lenders?

- How do we plan to repay any borrowings?

- What are our sources of revenue and income?

4. HR Strategy

How we plan to manage our employees and human resources processes. We should also discuss our
short-term and long-term plans for employee recruitment, training, and retention. If appropriate, discuss
any advisors, mentors, consultants that offer we support.
We may want to include:
- A brief organizational layout or chart of the business
- Who does what, with a brief job description of each position
- The essential skills required for each position
- Information on your employee training program
- Any other relevant information related to personnel

5. Production Strategy

We must forecast how many we have to product to achieve the target.

Then we have to align these strategies to the corporate strategy by using strategic human resource
managemet.