Case Study

Read the case study given below and answer all the questions.

Human Resource in practice The Change Challenge

A large retailer, MyGrocer has recently taken over a chain of small retail outlets and is undertaking the challenge of integrating its operations.

The challenge

As a result of the takeover, a two year change programme has been announced. This has restructuring implications and it is anticipated that staff headcount in the major distribution centres will be reduced by 25 percent. Some sites will be closed down, with approximately a further 350 job losses. It is anticipated that new centres will also be required and this will involve redeployment and recruitment of new staff. The Managing Director of MyGrocer is keen to maintain morale and performance during the change period. He recognises the need to involve all staff in the change programme and communicate the new business strategy and value transparently. He recognises that employees need to understand the reasons for the change and the possible implications for their future job roles. As the planned change is over a two-year programme, he wants to avoid a mass resignation of staff in the early stages due to fears over job security. The HR Director shared the Managing Director's concerns and wanted to avoid losing people and the need to maintain and enhance performance whilst restructuring, and they also needed to ensure that they retained staff with key skills and knowledge, which could then be transferred to the new sites.

The solution

Top managers were invited to a two-day communication event. The HR Director commented 'We delivered the news about the intended changes in the first hour and spent the rest of the two days trying to understand what their concerns were and how we could deal with them'. To encourage buy-in to the new business strategy and the change programme, the managers were offered a choice of personal and professional development courses so that if they did lose their job, they would feel better qualified to apply for another. The more junior staff were promised that if they could not find a role for them, they were entitled to RM3000 worth of training, their redundancy pay, a performance-related bonus and outplacement support. 'Most people don't like change, especially at work, the main reason they resist is because they feel they have no control. We wanted to make people feel more in control of their lives' added the HR Director.

A training and development consultancy was invited into its centres to run a series of workshops and personal development focusing on dealing with and surviving change, and challenging self development boundaries. Many blue collar staff were cynical initially. Workshops were organised to coincide with the different shift patterns and

were voluntary. The HR team worked in partnership with the trade union, and trade union stewards lead by example and attended the workshops. Change champions were appointed who promoted the workshops, and posters designed in the initial workshops were used to encourage all employees to attend. The workshops were subsequently well-attended and productive feedback sessions were organised with the senior management team.

Cross-functional project teams were established to consider change solutions. They were empowered to deal with 'real' change problems as they arose and resourced to implement solutions. Their successes were publicised throughout the centres and solutions were rolled out throughout the group. Line managers were encouraged to identify key potential in personal development planning sessions, and recommended individuals for succession. The Managing Director supported a talent management programme to support and retain staff with key knowledge and potential.

The outcome

The recent month's performance was quite successful in terms of distribution team's performance in terms of delivery efficiency and reduced costs, with 50 per cent of staff on track to earn their performance bonus. Shop costs were buoyant, employee turnover and sickness rates had improved and morale appeared strong. The training and development programme proved popular with employees. In survey feedbacks, 79 per cent of the attendees said they would apply what they had learned, while all participants said they would recommend them to someone else.

(Source: Adapted case from Beardwell, J. and Claydon, T. (2010). Human Resource Management, A Contemporary Approach, 6th edition, pg. 68- 69, Prentice Halt.)

End of Case Study

Question 1

Explain the strategic human resource approach that MyGrocer has used to implement the changes.

(15 marks)

Question 2

Comment on any THREE (3) human resource systems and practices which have helped to improve MyGrocer's organisational performance.

(15 marks)

Question 3

Suggest any TWO (2) alternatives that MyGrocer can consider to retain all staff instead of downsizing.

(10 marks)