Hancock Manufacturing: Leading in Difficult Situations

Hancock Manufacturing is a manufacturing company that has three manufacturing plants and 4.000 employees. Furthermore, there is a sales force division and a corporate office. The problems that the organization faces are mostly related to the inadequate presence of the HR department across the whole company. As the new Vice President of Human Resources, this is an immediate need to transform the HR department in order to make the HR function a viable contributor to the organisational excellence and help achieve its goals. (5) Action Plan The company faces the following problems in particular:  Turnover among the 3.200 manufacturing employees is averaging 43%: Although, Hancock is a manufacturing company and layoffs have been especially common in the manufacturing sector, this high turnover is a red flag that indicates poor management issues. Turnover creates most recruitment pressures. Although the market conditions and the environment are not known, it is relatively safe to accept that the dominant reason for this high turnover is low job satisfaction (i.e. the employees dislike the job and they experience work overload and stress) and poor HR practices, like low compensation, little recognition, lack of fairness and low employment security and safety. (1)

Turnover among the 125 sales representatives is approaching 50 percent: Further to the above, sales division turnover is unreasonably high. In order to reduce unwanted turnover, in order to increase workforce retention and decrease the need for recruiting, the management must understand the reasons for it. (5) This can be a cause of a lack or miscommunication of company’s culture, vision, values and mission. If the employees do not share the top management’s view of the kind of company that it is trying to create and they do not know what the company is trying to accomplish, then they are not inspired to do their best at work. However, it should also be examined, if the compensation benefits are attracting and motivating. (1)

Among the manufacturing plants last year, there were 118 lost-time accidents, which is an increase of 28 percent over the prior year: Although the number of accidents is crucial, the Safety Manager has faced resistance from other managers throughout the company and those in the HR department to accomplish his safety goals. This behaviour must change and the safety manager must cooperate with the HR and the training manager in order to perform trainings on personnel and to provide a safe environment for the employees. (1) Attendance policies throughout the company have not been enforced: In addition to the high turnover of employees, there is clearly a problem in policies application. Attendance policies have not been established, so the absenteeism of employees creates many problems. An effective attendance policy ensures employee attendance to accomplish work. A fair and consistently administered attendance policy is critical for business success. (2) Last year, there were eight cases of sexual harassment within the manufacturing division, three among the sales force, and one in the corporate office: Further to the above, there is also lack of a sexual harassment policy. The Company must be committed to provide a workplace that is free from sexual harassment. Sexual harassment in the workplace is against the law and must not be tolerated. If an allegation of sexual harassment is credible, prompt and appropriate corrective action must take place. (3)

Sexual harassment may be a cause of the high turnover. Facing the threat of job loss and seeing others lose their jobs can be a traumatic and bitter experience.  For new-hires, a formal orientation program does not exist: An induction program is the process used to welcome new employees to the company and prepare them for their new role. The training should include development of theoretical and practical skills, but also meet interaction needs that exist among the new employees. An induction program is an important process for bringing staff into an organisation and provides an introduction to the working environment and the set-up of the employee within the organisation. It will cover the employer and employee rights and the terms and conditions of employment and it must cover any legal and compliance requirements for working at the company and pay attention to the health and safety of the new employees.

It is intended to enable the new starter to become a useful, integrated member of the team, rather than being “thrown in at the deep end” without understanding how to do their job, or how their role fits in with the rest of the company. Good induction programmes can increase productivity and reduce short-term turnover of staff. These programs can also play a critical role under the socialization to the organization in terms of performance, attitudes and organizational commitment. (4) The training manager will work close with the VP HR and the HR director in order to receive direction and guidance and will perform additional meetings with all management personnel. The HR department as a whole is viewed as ineffective and rarely has a presence beyond the corporate office: Summarising all the above problems, the HR department needs restructuring and needs to perform many changes in order to contribute to the company’s bottom line.

The action plan has to focus on four main areas: 1) Re-evaluate the structure of the HR department, make changes to the organisational chart in order to be more effective but also efficient. 2) Define and communicate company’s culture, vision, mission and values. 3) Update policies and procedures manual, in order to include all above mentioned policies that are missing, to ensure safety but also create a proper compensation, benefits and reward system for all employees. 4) Always communicate openly, clearly and honestly with all employees, manage change and actually listen to their needs. Furthermore, since it is a manufacturing company, it would be nice if it could promote its Corporate Social Responsibility. Additionally, in order to create a fair and motivating compensation and reward system, it must be based on performance appraisal. It must also be based on salary surveys and job evaluation. (5) Since this is a huge project, an initial plan will be created. In the mean time, 360o appraisals will be performed gradually from top management level to the lower management levels and after 6 months the results will be used in order to create the final plan. The Action plan is summarised in the below table:

Action Perform all necessary changes in HR Structure. Changes take place immediately, hand-over finishes in 3 months Perform visits on all sites and meet with all employees in order to make the acquaintance and to communicate changes and company’s vision, mission, values Coordinate Employee Survey Share Results of Employee Survey and communicate next steps Create attendance and sexual harassment policies Create performance appraisal plan and communicate to employees Create initial compensation, benefits and reward system. Evaluate safety systems of plants and update procedures as necessary Perform trainings on all personnel regarding safety issues. Create 360o appraisal program Gather results of 360o appraisal program Create final compensation, benefits and reward system. Create Induction Plan for new hires Provide CSR Plan

Performed by HR Department VP HR VP HR VP HR HR Director VP HR & HR Director Payroll Specialist Safety Manger Training Manager & Safety Manager VP HR & HR Director HR Director HR Director & Payroll Specialist Training Manager HR Director

Priority High High High High High High High High High High Medium Medium Medium Low

Preceded by N/A N/A N/A 3 N/A N/A N/A N/A 8 N/A 10 11 N/A N/A

To Be Concluded in 3 months 1 month 2 months 3 months 2 months 1 month 2 months 1 month 1 month 3 months 5 months 6 months 3 months 6 months

Table 1: Action Plan of HR Department

Organisational Chart of HR Department

The organisational Chart of HR Department changes are shown below:

Vice President of Human Resources (you)

HR assistant Derrick Huntington

Director of HR Billie Middleton

Training manager Jimmy Adams

Safety Manager Mitch Jefferson

Payroll specialist Louise Monroe

HR supervisor, Albuquerque plant Vacant

HR supervisor, Cleveland plant

HR supervisor, San Diego plant

Janette Morris

Sandra Lee

Figure 1: New Organizational Chart for HR Department Al Washington, the HR Director will be laid off, because he is moderately effective and was pursuing the VP position. However, due to his commitment to the company, he will be offered an outplacement program, which will be outsourced, in order to give him the opportunity to find a new job quickly, but also to show to all employees that the upper management has the will to change things, and to avoid survivors’ syndrome. (5) Billie Middleton, the ex-HR Assistant will be promoted to HR Director. Since he is highly professional and competent and he has been helping all HR personnel, except the HR supervisors, for many years, he has already knowledge of the work that must be done and he will do his best to make things happen. Derrick Huntington, the ex-HR supervisor of Albuquerque plant will be promoted to HR Assistant. Although it is a conflict in job titles, it is more difficult to find a proven good HR assistant than an HR Supervisor. He has many years experience in the company and since he is a good, hands-on HR professional, he is rewarded by moving up in the organisation.

The search for the new employee will be performed by the same outsourcing company. For all the above changes, communication, visibility, honesty, positivity and monitoring of the morale of employees will be taken into account. An exit interview for Al will also be performed. (5) However, all HR personnel will be evaluated during the following 6 months and objectives will be set. Regarding the employees that remained in the same job, things will be a little more demanding and the person that must pay the most attention is Janette Morris: She is very difficult to manage and she frequently goes against company policies in order not to hurt employees’ feelings. It will be communicated to her that her attitude must change, in order to continue working in the company. Job Descriptions Job Descriptions for the positions in the Organisational chart are:  Vice President of Human Resources Reporting to CEO Main Responsibilities:  Create company strategic recruitment and selection plan.  Create company strategic training and organizational development plan to meet personal, professional, and organizational needs of company employees. 

Oversee the design, development and implementation of compensation strategy and programs.  Evaluate procedures and technology solutions to improve human resources data management.  Recommend and maintain an organizational structure and staffing levels to accomplish company goals and objectives.  Evaluate company culture and provide recommendations on changes to accomplish company goals and objectives.  Develop and manage annual budgets for the division and perform periodic cost and productivity analyses.  Recommend and establish company policies and procedures.  Establish and implement short- and long-range departmental goals, objectives, policies, and operating procedures.  Serve on planning and policy-making committees. (6) Requirements:  Bachelor’s degree in Business Administration, Psychology, Sociology, Communication or relevant field.  Master’s degree in Human Resources Management or related discipline required.  A minimum of 14-year experience in Human Resources management and at least 8 years in Manager/Director Position.  Excellent planning, organizational, communication, project management and change management skills. Good multi-tasking ability. Excellent Computer Skills.

Thorough knowledge and practical application of HR disciplines including employment laws/compliance/regulations, employee relations, performance management and development, organizational design/development and compensation benchmarking. Balance of strategic thinking with tactical action to drive results. Leverage of strong business acumen and analytic capability to integrate HR and business strategies. Effective in coaching/influencing/negotiating and managing conflict. Resilient with a high level of personal integrity and energy. Proven ability to be an inspiring leader and effective manager.

Director of HR Reporting to Vice President Human Resources Main Responsibilities:  Cooperate with HR Vice President on formulation and implementation of HR policies and objectives.  Supervise and coordinate policies, performance appraisal, compensation, benefits, training and health and safety programs implementations.  Cooperates with the Human Resources VP on the development of the annual budget of the department.  Organizes and coordinates the Human Resources Department.  Reviews and evaluates work methods and procedures.  Meets with staff at the workplace to identify and resolve their problems.  Is responsible for records of personnel transactions such as hires, promotions, transfers, performance reviews and contract terminations.  Negotiates and resolves sensitive and/or controversial issues.  Prepares periodic reports to top management, as necessary or requested.  Participates in the coordination and negotiation of union contracts.

 Coordinates and Implements CSR Activities. Requirements:  Bachelor’s degree in Business Administration, Psychology, Sociology, Communication or relevant field.  Master’s degree in Human Resources Management or related discipline highly appreciated.  A minimum of 10-year experience in Human Resources management and at least 6 years in Manager/Director Position.  Excellent planning, organizational, communication, project management and change management skills. Good multi-tasking ability.  Excellent Computer Knowledge.  Thorough knowledge and practical application of HR disciplines including employment laws/compliance/regulations, employee relations, performance management and development, organizational design/development and compensation benchmarking.  Effective in coaching/influencing/negotiating and managing conflict.  Results-oriented, resilient with a high level of personal integrity and energy.

HR Assistant

Reporting to Vice President Human Resources Main Responsibilities:  Is the personal assistant of the Vice President HR  Supports the HR Director, Training Manager, Safety Manager and Payroll Specialist.  Provides administrative support to the Department.  Is responsible for the day-to-day operations of the HR Department.  Maintains records of personnel transactions such as hires, promotions, transfers, performance review and contract terminations.  Supports the development of a long-term strategic vision and plan for the department. (7) Requirements:  Bachelor’s degree in Business Administration, Psychology, Sociology, Communication or relevant field.  Master’s degree in Human Resources Management or related discipline recommended but not required.  A minimum of 6-year experience, preferably in a Human Resources Department.  Excellent organizational, communication, project management skills. Excellent Computer Skills.  Good multi-tasking ability  Results-oriented, resilient with a high level of personal integrity and energy.  Training Manager Reporting to Vice President Human Resources Main Responsibilities:

 Is responsible for all training programs.  Designs and develops training and development programs based on both the organisation’s and the individual’s needs.  Identifies training and development needs within the company.  Supervises the development and implementation of training strategies, plans and processes to support organizational goals.  Evaluates training and development programs. Amends and revises programs as necessary.  Develops effective induction programs.  Produces training material and delivers it.  Manages Training Budget.  Maintains up-to-date records of all training delivered in personnel.  Maintains up-to-date knowledge of legislation relevant to training and disseminates any new requirements to colleagues appropriately.  Produces reports as required. (8,9,10,11,12) Requirements:  Bachelor’s degree in Business Administration, Engineering, Communication, Education or related field.

Training Certification Required. Minimum 5 years of experience in training and employee relations. Working knowledge of employee relation practices, including dispute resolutions and investigation experience. Strong leadership abilities and project management skills. Excellent listening, verbal, written, and interpersonal communication skills. Strong presentation skills and public speaking abilities. Ability to encourage and motivate people. Depth of practical experience in both technical and non-technical training. Excellent knowledge of Computers. Process and procedure driven professional committed to own professional and personal development. (9, 11, 12)

Safety Manager Reporting to Director HR Main Responsibilities:  Initiates, coordinates and manages all the health and safety (H&S) related tasks within the organization.  Ensure that the company operates at high levels of workplace health and safety and complies with national and local relevant legislation.  Safeguard the organization from internal as well as external threats.  Is responsible for the design and implementation of health and safety programs and procedures. Co-operates with training manager to perform training of all levels of employees on H&S matters.  Conducts workplace and job hazards audits and inspections.  Develops and implements accident and incidents investigation, data analysis, and prevention programs and procedures.

 Analyzes and recommends safety related improvements to equipment and facilities. Investigates and evaluates new safety equipment.  Provides analyses of work areas and assignments as needed. (13,14) Requirements:  Bachelor’s degree in engineering, industrial management, applied health sciences, exact or applied sciences or related field.  Minimum 5 years of safety management experience within a manufacturing environment.  Excellent practical knowledge of safety rules and regulations. Knowledge of OHSAS 18000 system specification is mandatory.  Oral and written communication skills.  Strong analytical and problem solving skills.  Good administrative and excellent computer skills.  Aptitude to accept challenges and confront risks.  Team-player with strong leadership skills. (14, 15, 16)

Main Responsibilities:  Ensures accurate processing and recording of the company’s payroll, provides timely and accurate financial information, participates in daily data entry Payroll processing.  Reviews, analyzes and checks payroll reports for accuracy and makes necessary adjustments or corrections through journal entries or other established procedure.  Performs daily payroll department operations  Reconciles payroll activity to the bank accounts and processes debit notes  Processes employee data from the HR recording system to the payroll system  Recommends or participates in the development of new procedures and policies related to payroll operations.  Compiles financial, tax and payroll reports for both internal and external purposes.

 Compiles and analyzes payroll data and prepares related reports.  Coordinates and interacts with federal and state agencies on issues pertaining to employee compensation and deductions. (17, 18, 19)          Requirements: Bachelor’s degree in accounting, finance, business administration or related field. Master’s degree in related discipline highly appreciated. Minimum 5 years of related experience Knowledge of payroll and accounting principles, practices, regulations and procedures. Strong work ethic and team player with high degree of professionalism. Ability to deal sensitively with confidential material. Strong interpersonal communication skills. Ability to communicate with various levels of management. Decision-making, problem-solving and analytical skills with strong organizational and multi-tasking capabilities. (17, 18, 19)

Main Responsibilities: Is responsible for the HR functions in the plant, including recruitment, training, development, performance monitoring and employee counselling. Communicates HR Information. Actively participates in the implementation of company’s goals, objectives and policies. Coordinates with Training Manager, Safety Manager and Line Managers to identify training and development needs within the plant. Ensures the development and implementation of training programs in the plant Supports plant and corporate safety objectives by actively participating in plant safety teams and initiatives. Meets with staff at the workplace to identify and resolve their problems. Manages the employee performance appraisal programs for all levels of the plant.

Is responsible for developing and supporting positive employee relations activities. . (20,21,22)

Requirements:  Bachelor’s degree in Business Administration, Psychology, Sociology, Communication or relevant field.  Master’s degree in Human Resources Management or related discipline recommended and highly appreciated.  Minimum 5 years of working experience in HR Department within a manufacturing environment.  Superior interpersonal and time management skills.  Excellent planning, organizational, communication, project management and change management skills. Good multi-tasking ability.  Excellent Computer Knowledge.  Thorough knowledge and practical application of HR disciplines including employment laws/compliance/regulations, employee relations, performance management and development, organizational design/development and compensation benchmarking.  Effective in coaching/influencing/negotiating and managing conflict.

 Self-motivated, results-oriented, proactive and resilient professional, with a high level of personal integrity and energy.  Flexibility in working hours. Objectives of HR Department Following the above mentioned problems, it is clear that objectives for the HR Department must be set. Hence, the HR Department will contribute to the company’s bottom line. The Objectives are shown in the following table: HR Department Objectives Additional objectives to the company’s bottom line  Increase of productivity Reduction of turnover among the manufacturing employees to 22%  Cost Reduction  Improvement of working environment  Increase of productivity Reduce of turnover among the sales representative to 25%  Cost Reduction  Better customer service and higher retention of customers  Cost Reduction Reduce accidents by at least 55%  Increase of productivity  Improvement of working environment

References:

 Improvement of Corporate Image  Improvement of working Eliminate sexual harassment incidents environment  Reduction of turnover  Improvement of Corporate Image  Turnover Reduction  Cost Reduction Implement HR Action Plan  Increased productivity  Improvement of working environment  Improvement of Corporate Image Table 2: Objectives of HR Department and contribution to Company’s bottom-line (1, 5) References 1. Werner Steve, Schuler Randall. Jackson Susan (2012). Human Resource Management, 11th Edition, South-Western College Publishing 2. http://humanresources.about.com/od/attendancepolicy/Attendance_Policy_and_A bsenteeism_Policy_Samples_and_Examples.htm (17-10-2012) 3. http://www.state.gov/s/ocr/c14800.htm (17-10-2012) 4. http://en.wikipedia.org/wiki/Induction_programme (17-10-2012) 5. Lecture Presentations, Case studies & Papers: Access to i-MBA Eduportal website (http://i-mba.dmst.aueb.gr/cgi-bin/det.cgi) (17-10-2012) 6. http://www.hrvillage.com/hrjobdesc/VPHumanResources.htm (18-10-2012) 7. http://news.msu.edu/story/butler-new-msu-human-resources-assistant-vicepresident/ (18-10-2012) 8. http://humanresources.about.com/od/jobdescriptions/f/hr_job_train.htm (18-102012) 9. http://www.inc.com/tools/training-manager-job-description.html (18-10-2012) 10. http://www.ehow.com/about_6457352_job-description-training-manager.html (1810-2012) 11. http://www.totaljobs.com/Content/Job-descriptions/HR/Training-developmentmanager.html (18-10-2012) 12.
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