Optimizing Human Resource Functions

The Human Resource Function

Human Resource is involved in the planning, development and further administration of policies and programs whose design is in such a way that they make expeditious use of the human resources of an organisation. Major functions of Human Resource Management include recruitment and selection, human resource planning, human resource auditing, performance appraisal, career planning and career development and maintenance of welfare, health and safety measures (Baron, 2016).

The emphasis of staffing is on the recruitment and selection of human resources for organisations. Because one of the primary functions of the human resource department is the process of recruitment, it is always important that HR managers ensure that the opportunities of employment are equal, free of any form of discrimination. In organisations, the actual selection of people to fill different positions precedes human resource planning and recruitment (Ahmad, 2019). Recruitment involves sending out invitations to individuals who are qualified to fill up available job vacancies. The process of employee selection follows after recruitment and the right people are identified through the use of written tests on subjects that are relevant, group discussions, oral tests and finally, the applicants sit for the final job interview.

Human resource planning involves the determination of the numbers and qualities of employees who are required to accomplish the goals of an organisation. One of the most important aspects of this function is research and that is mainly because collection and analysis of information are prerequisites of planning as they facilitate the forecasting of human resource supplies in addition to predicting future human resource needs (Akey et al., 2017).

Another function of human resource is human resource auditing. This is a process of verification of job analysis and design, recruitment, selection, orientation, placement, training, development, appraisal of performance, job evaluation, employee and executive remuneration, motivation, morale, in a systematic way. This helps achieve the goals of an organisation and also helps with assessing the effectiveness of an organisations HR function. Annihilation of the risk of management of contravening with liability exposure, laws, identification and correction of risk gaps, avoidance of litigation, avoidance of unnecessary costs, and enhancement of the best practices of human resource are the primary functions of HR audit.

There are different environmental factors like the economy, unions and labour markets, laws set by the government, industry product life cycles, and changes in technology and demographic changes that are capable of affecting the HR process. Other organisational factors like corporate missions, satisfaction with job, restructuring, job analysis and organisational culture are also capable of affecting HR functions.

Ince Umbrellas

Ince Umbrellas is the longest established manufacturer of umbrellas in Britain. The company offers a bespoke commission manufacturing service and is also capable of tailoring the designs and styles of umbrellas such that they fit different unique specifications of different customers. What that implies is that they are capable of offering services that are fully factored where they get to supply different items from content labels, buttons to fabric. Alternatively, customers are free to supply their own fabric from which Ince Umbreallas makes cuts and trims to the specifications of their customers (Products, 2020). The mission of Ince Umbrellas is to maintain their traditional quality values while offering the required experience and flexibility for production of products of a top quality that are suited to the needs of post-modern societies. Their vision is to be a global leader in clothing and apparel manufacture and other related products.

Over the years, Ince Umbrellas has had to overcome different disruptions like the movement of most key manufacturers of handles from the UK, the rise in mass production of umbrellas offshore and their subsequent importation to Britain and also the seasonal nature of the business because it is affected by seasonal changes.

Required Human Resources

These include the individuals who are involved in the actual sewing and assembling of umbrellas, the security people within the company, the individuals involved in logistics, that is, transportation of the umbrellas to the markets and transportation of different raw materials from different places into the company, administration which includes the managerial, finance and human resource departments, marketing of umbrellas and advertising, record keeping, store keepers and generally every other person employed in the company.

Non-human Resources Needed

The non-human resources used in the manufacture of umbrellas are mainly the raw materials.

For proper understanding of the raw materials required in the manufacture of umbrellas it is prudent to know the different parts of an umbrella which are the umbrella frame, umbrella fabric. The frame consists of the stretcher, runner, rib, shaft and handle.

Other non-human resources include machinery, finance, time, plant, land, resources used for advertisements and marketing and managerial resources. Machinery includes the sewing machines used to manufacture the umbrellas and any other machines that are used, for example, for the shaping of shafts. The finance resources cover the employees’ wages, the costs incurred in the acquisition of raw materials and even costs incurred to purchase the different machinery used in making umbrellas. Another resource that is often neglected is time. Time is a very critical resource and operations have to be timed well to ensure that all activities are completed within the set time frames. The plant where the umbrella manufacturing company is located is an asset which is a very important resource together with the piece of land where the plant is built.

The Resource Plan

An assumption is made that every other raw material will cost the same throughout the whole year.

During the peak umbrella sale seasons, that is, when there are high temperatures and most rains, Ince Umbrellas would effectively operate with 60 employees manufacturing 1000 umbrellas monthly. The number of employees should be cut down to only 15 when they scale down by their operations by 75% and operate at a capacity of 25%. That would mean they operate with 15 employees. When operating at a capacity of 75%, Ince Umbrellas would then revise their employment contracts and employ 45 people to ensure smooth flow of operations.

Ways of Minimising Costs and Maximising Profits

Markets do not have customers who are homogenous. Every time customers go out looking for umbrellas, they just seek umbrellas that have the basic functions and that are sold at prices that are competitive. Those companies that cater for the needs of these customers therefore have to adopt low-price strategies. When a product`s demand is highly elastic, lowering of prices brings about an increment in demand. While lowering the prices of their umbrellas would mean that Ince Umbrellas earn less revenue for every unit of umbrella they sell, there would be an increment in the volume of umbrellas sold which in the long run, will bring about more profits. The key to the successful adoption of low price strategies is the ability to mass produce umbrellas while also expanding the channels of distribution (Simon and Fassnacht, 2019).

The umbrellas manufactured by Ince Umbrellas are recognised across the entire Britain as being of top quality, which has enabled them to command higher prices over the years in the market. It is worth noting that profits are not guaranteed by prices alone, but they provide companies with opportunities of maximising profits. When companies charge prices that are higher for products that are of a high quality, they are bound to get more profits (Nasr and Cheraghi, 2017). It is however worth noting that the strategy of differentiation only works in those markets where customers are not very sensitive to prices and are more conscious of quality.

Ince Umbrellas also needs to review its measures of cost control. The most effective strategy they need to employ people on fixed-terms. Those individuals who are recruited for purposes of covering seasonal work could be taken on for limited time periods. As such, fixed-term contracts are used, with the contracts ending on dates that are specific and once particular projects are completed. In this case, Ince would employ more people on fixed-term contracts during the rainy and extremely hot seasons when the demand for umbrellas is high and after these seasons are over, they get to only renew a small number of the contracts. The expiry dates of fixed-term contracts are considered as dismissals.

Finally, maintenance of market share is another strategy that Ince Umbrellas could adopt. Those companies that get to experience anaemic sales have a lower likelihood of achieving profitability. While every unit sold could raise enough revenue capable of replacing the unit variable costs and even gaining some profits, companies are observed to depend on the accumulation of unit profits from many sales units for purposes of covering fixed costs fully and even breaking even (Palmer et al., 2018). When companies have low sales volumes, they are not capable of maintaining the necessary market share levels and they are not capable of covering their different overhead and fixed costs. For minimisation of losses, companies need to aim at achieving break-even sales volumes through maintenance of market share levels that are satisfactory.

Conclusion

The objectives of human resource management involve the effective utilisation of human resources, building of desirable working relationships between the different members of an organisation and ensuring maximum development of the different individuals within an organisation. The required human resources in Ince Umbrellas include all those people who are employed in the umbrella manufacturing company to perform different roles which are essential to the manufacture of umbrellas. Non-human resources include raw materials, time, plant, land and finances. There are different ways through which Ince umbrellas can be able to make their operations more effective by minimising costs and maximising profits. These include the adoption of low-price strategies, adoption of measures of cost control, differentiating their products and maintenance of market share. Ince Umbrellas should ensure that they utilise their resources well to ensure that they stay profitable and minimise their costs.

References

Akey, B.C.A., Dai, B., Torku, E. and Antwi, E.A., 2017. Human resource planning and the development of employees in contemporary firms. European Journal of Contemporary Research, 6(1), pp.299-305.

Baron, A., 2016. Human resource planning. In Encyclopedia of Human Resource Management. Edward Elgar Publishing Limited.

Nasr, M.D. and Cheraghi, M., 2017. The Study of the Effect of Diversification Strategy, Cost Leader-ship Strategies and Product Differentiation on Business Unit Value.

Palmer, K., Tate, J.E., Wadud, Z. and Nellthorp, J., 2018. Total cost of ownership and market share for hybrid and electric vehicles in the UK, US and Japan. Applied energy, 209, pp.108-119.

Simon, H. and Fassnacht, M., 2019. Price Strategy. In Price Management (pp. 29-84). Springer, Cham.

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