Human Resource Management of HM

Human choice solicitude of HMThis is a drive study on HM, from a Strategic Human Resource Manage manpowert perspective, establish on publicly available details of HM, which has been analyzed and presented inside the context of the perspective. This case study was prep bed to equalise the requirements of an academic exercise.HM was established in Vasteras, Sweden in 1947 by Erling Persson. HM sell turn and cosmetics in around 2,000 injects around the world operates in 37 countries and has 76,000 employees distributively(prenominal) fakeing to the equivalent philosophy to bring you invent and timber at the exceed price. HM is a hugely victorful transnational comp some(prenominal). The success of HM is primarily based on the backup model of easily throw existence through internall(a)y and centrally, manufacturing totally outsourced, al superstar character reference en receivedd and local anaesthetic selling with hired places, local lag and local mark private i nstructors empowered to take decisions. The success, billet maketh and expansion plans were possible because HM consume formatted their HR system in line with the integrated dodge. As evident from their Annual physical composition (2008), when they expand into refreshful markets they do non lose sight of their core set. They extradite succeeded to manage all components of HRM in effect to ensure that core value ar upheld in all parts, c atomic number 18less(predicate) of coun judge and cultural differences. Their strategic and coherent shape up in recognizing that the organizations some valued as delimits ar the mass speed(a) there,INTRODUCTION COMPANY systemHennes Mauritz (HM) was established in Vasteras, Sweden in 1947 by Erling Persson. HM offers forge and whole step at the best price and offers fashion for women, men, teenagers and children. The collections argon created centrally by around 100 in-house externaliseers together with buyers and pattern ma kers. HM a manage sells stimulate-brand cosmetics, accessories and footwear. The interposes atomic number 18 refreshed daily with in the altogether fashion items. In Sweden, Norway, Denmark, Finland, the Netherlands, Germany and Austria HM offers fashion by Internet and catalogue gross revenue. HM does non testify any factories, yet instead buys its goods from around 700 commutative suppliers, primarily in Asia and Europe. HM has roughly 16 merchandise built in beds around the world, mainly in Asia and Europe. The employee turnover in 2009 was SEK 118,697 million. HM primarily operates in Europe, North America and Asia, and select around 2,000 lay ins bed cover over in 37 countries. The bon ton is headquartered in Stockholm, Sweden. HM has erectn signifi stoogetly since its beginnings in 1947 and at the end of the monetary year had around 76,000 employees. The modal(a) number of employees in the Group, converted to fulltime positions, was 53,476 (53,430), of which 4,874 (4,924) atomic number 18 employed in Sweden. Around 79 portion of the employees were women and 21 percent were men. Women held 77 percent of the positions of justifiedlyeousness within the caller, such as store managers and country managers (AR2 2009).HMs dodging is to offer fashion and quality at the best price. HMs yearbook handle (AR1 2009) emphasizes that quality relates to both. HMs products exceeding guest expectations, and excessively customers be satisfied with the accompany itself. The circulate states Taking function for how our operations appropriate people and the environment is also an innate prerequisite for HMs continued profitability and egress.HM is driven by strong values such as commercial mindset, simplicity, constant modifyment, price consciousness and enterprisership states in annual go through upon (200913).The World of HM (HM 2010)Long-term strategic plan goals of HMHM which is in the fashion retail industry. HM has stores i n 37 incompatible countries and employs over 76,000 people. The business apprehension of HM is very clear. It is offering to clients qualitative fashion clothing for low price. The company has its protest team of designers, its own interior designer team, its own production factories, production partners and team for purchasing other brands production. It usually stock up HM cosmetics supply, making sure that those products get out be cheaper than in other stores.Long term accusatorys are strategic plans company make for future five years. These objectives are set in seven key areas- productivity, profitability, aspiration, employee teaching, employee relations, technological leadership and public responsibility and show were company wants to be when they are achieved. Long term objectives present to be motivating, flexible, measurable, suitable, understandable, realistic and acceptable by employees.Three main strategic goals for HM for the next five years would be linked w ith profitability, competition and technological leadership. HM has reported a rise in gross gross revenue and profits and sales for the three months to 31 August. Net profit for the ordinal quarter of 2009 rose 4.1% to 3.46bn Swedish crowns from 3.33bn crowns last year. Sales, excluding sales tax, step-upd by 13% to 23.6bn crowns. So first LTO is to maintain financial stability HM has achieved. HM plans to make up sales revenues by 20% and earnings per parcel of land by 30% till 2015.Secondly as main schema of HM is expansion, LTO in competition is to increase number of stores by 10% to 15% each year. Today HM has as 1840 stores up from 1618 at the same time last year. New stores tolerate be circularise in the cities HM already has stores and also in completely advanced markets.In the Annual Report (20087), HM, CEO Rolf Ericsson states that the long term goal is to Make fashion available to everyone, take over got the customer a fashion find that strengthens HM brand. They also state the goal of a 10-15% increase in the number of stores every year, which would be funded internally (2009). The aim to increase sales in existing stores, while focusing on quality and continued high profitability.How does HM want to get there?To put through its strategy HM focuses on 3 main aspects of its business concept in the annual report of 2009.Price, which is controlled by limiting the number of middlemen, purchase in large volumes, relying on its in-depth, blanket(a) expertise within the design, fashion, and textile industries, buying the right merchandise from the right production markets, being cost-conscious at all levels and maintaining effective distri aloneion procedures.Design Products are designed in-house and production is completely outsourced.Quality Central emphasis on quality with extensive testing and ensuring least environment damage.Merger and Acquisitions Acquisitions (like FaBric S stinkerdinavian, the Swedish design company), and Desig n Collaborations (collaboration with Mathew Williamson) are adopted.SWOT Analysis(S)trengths unity of the main reasons for HMs popularity is because of its chic items for such a low price. This store offers quality clothing at department store prices which is rare for many retailers today. Strength for this company is their overall delivery time. It nevertheless takes 12 weeks to get an item from the design to its retail state which is very impressive for a worldwide, low price retailer. The average for retailers is usually nigh 6 months which is double the time that HM uses. They also manage to keep the stores brands fresh with guest designers coming in for diametrical lines in the store. Some of these scram been Madonna and Robert Cavalli. They also keep the prices low-cost by using very few middlemen and buy large volumes cost consciously. further with these strengths come flunkes as well.(W)eaknesses One of the strengths I mentioned above heap also be a weakness for t his company. Buying large volumes mover that there is no real guarantee that all the items will be sold. This means that theyre already low prices may have to be take down in order to make get on for the next collection. This means that if these items are not sold in time, then the company will have to pay more for extra storage for the items not sold. Another weakness could be its wide setting of customers this brand provides for. The clutches is for men surrounded by the ages of 18-45. This is not including the childrens clothing and maternity wear and the huge wide range of different styles they provide depending on what store you go into. This can be difficult to manage especially in a vertical company because there is no real focus on a purport customer and gets more expensive to provide machinery for all these different groups of people. But with these huge leaps there are many opportunities for this company flourish.(O)pportunities One good prospect would be for HM is to have matching clothes for mothers and children. I think this would be a good opportunity because there are also maternity wear and childrens clothes and I think that it would supplication to a larger crowd. They would like to dress their children like them in the same styles.(T)hreats since HM is a brand that is very unique it has very few threats as far as retail chains go. One of these stores would have to be the clothing chain called ZARA. This is a store that also has passably reasonable prices but is most famous for its rapid delivery time. It only takes two weeks for the design to make it into retail stores. Even with HMs time which is 50% faster than most retailers, cannot even compete with that time. The second threat to HM is Gap just because of their quality at reasonable prices and their wide range of people they reach as well with their vertical company as well. There is a market for babies as well as men and womenHuman ResourcesHMs corporate strategy is to exp and on a inveterate basis, and as a consequence, employee strength also increases endlessly. The growth target is 10-15 percent new stores each year, which means that 6,000 -7,000 new furrows each year. Their lag is spread across approximately 37 countries and come from different cultural backgrounds. Their strategy is to bring up locally whenever a new store opens as declared in the annual report (2008).The main area for which HM may have clearly articulated policies are listed below. The policy areas are based on the categorization by Armstrong (2006).Overall Policy and Values HMs website betokens that their objective is to be a good employer, including in those countries whose laws and regulations fall short of their own requirements. To quote the Head of HR In order to find peoples expectations of HM as an attr sprightly employer, the company develops global guide lines on diversity, mates rights and against discrimination (AR1 2008).At HM, HR activities are guided by a fundamental frequency look on for the respective(prenominal). This applies to every aspect from fair wages, move arounding hours and immunity of connexion to the opportunity for growth and ripening within the company. This also indicates that the company has particular policies for areas such as Equal opportunity, Managing diversity, and Employee development, Health and Safety, among others.Employee Relations and VoiceHM has an open door policy granting all employees the right and the opportunity to dispute any work- link up issue speakly with management (AR1 2008). They also support their employees right and ability to organize and to decide who should represent them in the workplace (AR1 2008). HM has positive experience of open and constructive dialogue with the trade unions and they pick up such relations wherever they operate. They consider such cooperation to be essential if they are to arrest even better. Examples of collaboration on staffing issues include their cartel with UNI (Union Network International) and the work they do with the EWC (European Works Council).Promotion In the annual report of HM (200834) the Head of HR quoted Internal recruitment and occupancy rotation enable the company to grow quickly. This statement indicates that HM has policies related to promotion.Employee Development To quote Mr. Par Darj, Head of HR at HM I tell employees, if you do not grow uncomplete will HM (AR1 200834). This indicates that policies exist for this area.Rewards tally to the annual report (2008) HM focuses on supporting people by providing more opportunities and responsibilities, and not through a promotions and job titles. This indicates that HM has policies for this area.Other areas with clearly specify policies might exist, but these are not evident from available sources.Organization Behaviour and social organisationStructure Corporate management is based at HMs head office in Stockholm. Stockholm is also where the main department s for design and buying, finance, accounts, expansion, interior design and display, advertising, communications, IR, HR, logistics, security, IT and CSR and environment are located.HM has around 16 country offices that are responsible for the different departments in each sales country. HM also has around 16 production offices which take mission of contacts with the approximately 700 independent suppliers that HM works with. There are nine production offices in Europe, eleven in Asia and one in Africa.Behaviour HM operates in 37 countries and has a work force belonging to these 37 countries because they recruit locally. HMs espoused values are give tongue to to be the foundation for a multinational company in a multi cultural market where groovy respect is paid to the several(prenominal).Interviews with the CEO and Head of HR in the annual report indicate a participative socialization where everyone is made to feel like a part of the companys success (AR1 200834). Par Darj (He ad of HR) stated in the annual report the key word for continual growth is responsibility and commitment. We have commit employees and we are prepared to delegate responsibility at every level. The company encourages what it calls the The HM spirit employees committed to their work and prepared to take on new disputes, common sense, hard work and team spirit are encouraged. All their operations are typified by an essential respect for the individual including reasonable wages, reasonable hours, and opportunity to grow, and develop within the company (AR1 2008). Quotes from employees about the organisational climate indicate that the values above are values in use. These quotes can be found on the career department and in the annual report of HM.Based on this information the ordinary culture appears to be primarily task oriented (Schein 1985). Such a culture can support HM HR related strategies and policies (like spread out door, job rotation, freedom of association etc.). They also have a substantial impact on HR aspects Recruitment needs to focus on finding candidates with the right fit to the organisational culture irrespective of local culture, facilitating expatriation of experienced staff when new stores are undefendable, facilitating rewards schemes align with organizational culture, enabling HRD that can empower employees to take on new challenges and work in new teams.At HM, a lot of importance is devoted to own(prenominal)ity development and for opportunity for the employees to grow within the organization. Various practices empowering the employees like a Shop Manger being allowed to take independent decisions, and managing the business like an entrepreneur etc. are designed to increase employee dedication and commitment to the organization and are great motivators (AR1 2008). The HR strategy for employee pauperism total reward with emphasis on Intrinsic motive (Armstrong 2006), has been exhibitn, to be directly related to forming the su ccess of the organization. All their operations are typified by an essential respect for the individual including reasonable wages, reasonable hours, opportunity to grow and develop within the company (AR1 2008) The prevailing organizational culture at HM encourages team work, supports effective leadership and provides adequate growth opportunity for employees. These HR strategic initiatives in turn make significant contributions to the organizational goals of continuing growth and profitability.Organization CultureHMs strong corporate culture the spirit of HM has existed ever since the eld of HMs founder, Erling Persson. This strong culture is of great value and is a contributory factor to HMs successes over the years.The spirit of HM The spirit of HM is based on a number of values that describe in simple terms how we want to work. These are in turn based on our business concept, fashion and quality at the best price. The fundamental values behind the spirit of HM are among othe r things common sense and own initiative. HM provide room for people to make their own decisions and take responsibility, and co-workers get regular feedback on their performance. An important part of HMs culture is to delegate responsibilities to the stores. Strong commitment and interest are important, and co-workers are encouraged to take their own initiatives within a defined framework. Creativity and job pleasure increase when there is a good working environment. Co-workers commitment makes a major contribution to HMs successes. HM believe in the abilities of the individual and encourage co-workers to develop further. Respect for the individual is a fundamental value at HM. This applies to everything from fair pay, reasonable working hours and freedom of association to the opportunity to grow and develop with the company. Job rotation is common at HM. In the stores, for example, duties may vary between the immediate payment desk, fitting rooms, unpacking, display and follow- up of advertising and campaigns. Working in the store provides very important experience and is a way of getting to live on HM from its very foundation. Attracting and retaining skilled staff is important for HMs success thusly HM work eer on skills development and all readiness is carried out within HM. However, the biggest knowledge gain is made through active study on the job.Information SystemHM has employee- schedule system to improve its use of staff resources and maximise time spent by staff on the shop floor.The Swedish clothing company implemented. 30,000 employees swipe in and out with smartcards at the beginning and end of their shifts. The system reduced brass section by recording shifts electronically and helped improve sales by scheduling shifts to coincide with the busiest times in stores.The scheduling application is linked to HMs gentleman resources and payroll systems, which lets the retailer control staff costs more accurately.The men focus application fro m software supplier Work Place Systems will be hosted at a data centre in Stockholm.Motivation at HMHM is a flat organization, which might give the impression that its hard to move up within HM, the organization is constantly evolving and is growing fast, thus providing more opportunities to its employees. Employees are motivated by providing new challenges in another department, another role or, another country. HM encourages employees to try many different roles within their organization stated in annual report part 1 and 2 (2008).HM recruitment advertisements indicate possibilities like working abroad, furthering education and erudition new things. Their websites promotes that many in management today, actually started on the shop floor. HM also provides a world-wide benefits package. HM fulfils employee aspirations by providing opportunities to take more responsibilities.Individual development versus organisational development.HMs annual report (AR1 2008) and website (Careers website), emphasize that working at HM is about commitment, both from the individual and the organization. HMs Head of HR emphasizes that organization can grow only if the individuals grow. HM wont make a career plans for their employees, but will provide them with tools to go as far as they by chance can on their own.This indicates that at HM, individuals are expected to drive their own development, within the framework that the organization provides. The organization appears to facilitate and promote cross-functional and cross-boundary development opportunities for individuals, which is aligned with their own development and growth strategies.To quote Pr Darj, (Head of HR), We have committed employees and we are prepared to delegate responsibility at every level. I tell employees, if you do not grow neither will HM, (AR1 200834). This indicates that HM treats individual development and organizational development as tightly linked areas.Selection RecruitmentThe HR strategy, which is closely aligned with the organizational strategy to achieve continuing growth and profitability, envisages recruitment of people every year to run the new stores scheduled to be opened. For example, as per their Annual report (AR1 2008), about 6000 7000 employees are to be recruited during this financial year, to meet the requirements of the 225 new stores being opened worldwide. The planning and recruitment is based on the HR policy to recruit locally when a new store is opened. Future employees are evaluated and chosen according to certain criteria practiced by HM and based on the companys culture.They look for people with soulality who can perform well within the culture, growth and motivational framework provided at HM. Par Darj, Head of HR stated, At HM, great grades and all the university ascribe in the world are no guarantee of a job or a fast-track career. Of course, we do experience those things, but what we are truly looking for, more than anything, is people with the right personality. This is based on the intuitive feeling that one can always gather skills as you go along, but personality and attitude cant be taught. Either youve got it or you dont. One of the most important things we look for is drive (AR1 2008). HM values personal qualities much more than formal qualifications. Since HM is a fast company and the tempo is always high, they need employees who are self-driven and capable of well direct communication. Hence HM recruits people who like responsibility and decision-making also it indicates that a love of fashion combined with a focus on sales is perceived as an advantage. These appear to form the basis for HMs recruitment requirements (and person specifications), programmes and drive its filling surgical procedurees.At HM selection interview approach is usually face to face and mostly structured situational based According to Armstrong (2006) In a situational based interview the focus in on a number of situation or incidents in which behaviour can be regarded as being particularly suggestive of succeeding performance. This is followed by panel interviews and aptitude/work sample tests. It appears that candidates are filtered at each stage of the process in HM.Sources of candidatesInternal Recruitment This is their first cream for a new job opening. External recruitment is considered only if no internal options are available.External recruitment Potential recruits (minimum age is 16 years) are encouraged to apply directly to the local store, from the careers website. HM does not offer summer jobs or work experience placements. Buying is alter in Stockholm, and so is the recruitment for the same.HM recruits locally to its new stores (AR1 2008).Organisational teaching and management development in HM.The average numbers of raising days per employee in 2008 are, 10 for new sales staff, 1 for existing sales staff and 5 for existing management positions. HM usually conducts all training in-house (classro om, stores and one to one), written and produced by HM staff. External training has been considered for some areas like buying. E- acquirement has also been initiated for a few subjects (AR 2008).However, indications are that HM today focuses more on on-the-job, just- in time, hands on learning. For example, when they opened their first HM store in Japan, locally recruited employees were sent to Norway and Germany for gaining experience in existing operations. Also, during the sales intensive opening phase of a new store, colleagues from other countries are brought in temporarily (AR 2008). The head of HR quoted in annual report (200834) As an employee of HM, you can be an entrepreneur and you will be given responsibility early on. HM claims to provide structured opportunities for on-the-job, hands on and work place based training.To summarize, it appears that HM focuses on experiential Self-directed learning today as defined by Armstrong (2006), however, they are moving towards inc orporating a blended approach with including mannequin and e-learning.Ensuring Learning and Development opportunities for its employees is an integral part of the HR strategy at HM (AR1 2008), and these essential ingredients contribute significantly to the success of the organization. Human Resource Development is a continuing process at HM, the new recruits being sent to already existing shops for gaining valuable experience, experienced employees being brought to new shops to support the new local recruits during the intensive opening period employment etc. This is unfavorable to the process of organizational learning and helps them climb the learning curve faster. Keeping employees highly motivated is essential to the success of HM, collectable to the nature of its business of dealing in high fashion consumer goods. The various concepts that can be adopted to increase performance (like job satisfaction as a reward management tool) are very in effect employed and as the employ ees themselves state, they are happy to be there and every day is a challenge (AR1 2009). Expectancy Theory, which states that if individuals feel that the outcome of learning is likely to benefit them, they will be more inclined to prove it (Armstrong 2006) has been proved on the shop floors of HM.The HR practice of giving responsibility to the employees early on in their career, treating them as entrepreneurs rather than just employees is a definite and positive step towards their development. Considering the employees as capable of shaping its results and meliorate it in big and small ways and is key to HMs approach to learning and development.Reward ManagementThe reward management process of HM and its electric potential influence on human resource management.HMs careers website indicates that the company offers a comprehensive benefits package, which includes staff discounts, incentive bonuses, company sick pay, private health care a pension scheme. Share options are not pr ovided. The head of HR, indicates that they do not consider titles and pay structures as motivational tools. Opportunities to fulfil an employees aspirations by wanting more responsibility, as a means of getting on with in the organization quickly, are provided. Apart from these, as stated by different categories of employees on the careers site and the annual report, the main reward is the job satisfaction they derive.Thus, HM appears to provide a total reward framework, with great emphasis on relational rewards even though transactional rewards are provided (Armstrong 2006). HMs reward management is consistent with other HR areas, including organizational culture, recruitment/selection etc. and is also in sync with the overall HR strategy of open doors, job rotation etc. which is essential to fulfil HMs strategy of fast growth.HM has implemented the concept of Total Reward Management very successfully. Apart from the financial compensation, job satisfaction as a reward has motiva ted the employees to perform and contribute their maximum to ensure customer satisfaction and business success through increased sales. This is evident in the statements by the employees from various levels on the HM website. As a stated policy, there is more emphasis on personality development through delegated authority in the decision making process and greater impropriety to local elements of the organizational structure. Being a multinational company with employees of different cultures, this decentralized decision making process and empowerment of employees have proven direct impact on the success of HM (AR1 2008) Various techniques associated with grassroots motivation have been given more importance and priority than the adventitious aspects. Work environment related parameters like leadership, employee voice, recognition, achievement etc. have been built in to the HR policy and practiced to leverage the critical business goals of continuing growth and increased profitabi lity.Performance ManagementHM has adopted a strategic and integrated approach to achieve organizational success through improved performance of its employees. HM employees have been told that the growth of the employees and the organization are closely linked (AR1 2008). The practice of Shop Managers difference through a process of reviewing that days business with their subordinates on a daily basis is part of the performance management activity. This underlines the fact that HM has recognized the importance of such a practice, and built in that process by which managers and their subordinates work together, agree on what needs to be done and how it is done. They are able to plan, prioritize and develop their sales team in a customer-focused environment (AR1 2008). At HM a shop manager is in charge of the daily running of the store like running their own business. The HR strategy of delegating authority for managing the shops activities is a key factor contributing to the success of the organization.Managing Diversity in teams and groupsHM is expanding its business to open new shops in countries where they are currently not present. By their HR policy and procedures, when a new shop is opened the staff recruited locally. They also have the practice of job rotation and movement of employees from one location to another based on internal recruitment (promotions). This brings together people of different cultural back grounds together in the same team, and successfully managing such a team is crucial to the success of the organization. The HR strategy is, not to have very rigid procedures, and the corporate culture of respect to the individual. As stated in their Annual Report (AR1 2008), the HR strategy ensure the following1. In order to meet peoples expectations of HM as an attractive employer, company develops global guide lines on diversity, equal rights and against discrimination.2. HMs objective is to be a good employer, including in those countries whose laws and regulations fall short of their own requirements. The whole of their activity is shaped by a fundamental respect for the individual. This applies to every aspect from fair wages, working hours and freedom of association to the opportunity for growth and development within the company (AR1, 2008).3. HM has positive experience of open and constructive dialogue with the trade unions and they welcome such relations wherever they operate. They consider that cooperation is essential if they are to become even better. Examples of collaboration on staffing issues include their agreement with UNI (Union Network International) and the work they do with the EWC (European Works Council). (AR 2008)HMs success in executing their strategy of continuous international growth and expansion, while maintaining its Swedish organizational culture, indicates that its HR practices have contributed to the successful management of diversity in teams and groups.Recommendations ConclusionIssue and c hallenge at HM could be nurturing and maintaining a balanced relationship with employees. report managers may need good awareness of their reporters aspirations, to enable motivation by providing responsibilities and opportunities al