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

HR in practice Aeon Co Ltd acquisition of Carrefour Malaysia

Japanese retailer Aeon Co Ltd has invested RM65mil for internal and external renovation works on its hypermarket Aeon Big (M) Sdn Bhd, formerly known as Carrefour. Aeon Big, under Aeon Asia, is currently undergoing a rebranding exercise under the new management. Aeon Big managing director and Aeon Asean CEO, Nagahisa Oyama, said since its takeover of Carrefour Malaysia's 27 stores from Magnificent Diagraph Sdn Bhd, its team has worked hard to make a lot of changes in improving business to serve customers better and more efficiently.

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, Dato Patrick Low, of Aeon Big Sdn Bhd 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 Aeon Big's 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 exodus of staff in the early stages due to fears over job security. Nasreen Noshariza, the HR Director, shared the Managing Director's concerns and wanted to avoid losing people in a way that Aeon Big couldn't control. Aeon Big needed to maintain and enhance performance whilst restructuring, and they also needed to ensure that they retained key skills and knowledge, which could then be transferred to the new sites.

The solution

Aeon Big invited 30 top of their top managers to a two-day communication event. Nasreen Noshariza 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, Aeon Big offered the managers 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.

For more junior staff, Aeon Big 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 Nasreen Noshariza.

One of the ways Aeon Big did this was by inviting a training and development consultancy 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 c 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 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 from Beardwell, J. and Claydon, T. (2007). Human Resource Management, A Contemporary Approach, 5^th edition, pg. 69- 70, Prentice Hall.

Question 1

Comment on any FOUR (4) SHRM strategies employed at Aeon Big Sdn Bhd.

(20 marks)

Question 2

What SHRM advice would you give to Aeon Big, to ensure that they can manage the consolidation stage of their strategy effectively?

(20 marks)