Transforming nigerian organisations

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Human Resource Management is the efficient management of the people resources of an organization to facilitate the achievement of its goals. The challenge facing most organisations is how to get the …

Human Resource Management is the efficient management of the people resources of an organization to facilitate the achievement of its goals. The challenge facing most organisations is how to get the optimal output from each of its employee. In the past, the human component in organisations was regarded as inconsequential, with very little attention in terms of organisational resources allocated to its development, until the mid-twentieth century when efficient human resource management started gaining importance as vital to the progress of organisations.

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  • 1. TRANSFORMING NIGERIANORGANISATIONS: THE HUMAN RESOURCES (HR) IMPERATIVE Essay written and submitted by Ukwuegbu Anthony Chijioke. Chijistar@gmail.com or 0818 212 0314 Department of Business Administration, University of Lagos.
  • 2. BIOGRAPHYNAME: UKWUEGBU, ANTHONY CHIJIOKED.O.B: SEPTEMBER 13, 1992.ADDRESS: 7, SALAKO STR., IJAOLA ESTATE, LEMODE-IJOKO ROAD, AGBADO STATION, OGUN STATE.TELEPHONE: 0818 212 0314EMAIL: CHIJISTAR@GMAIL.COMSCHOOL: UNIVERSITY OF LAGOS. Essay written and submitted by Ukwuegbu Anthony Chijioke. Chijistar@gmail.com or 0818 212 0314 Department of Business Administration, University of Lagos.
  • 3. Abstract Human Resource Management is the efficient management of the people resources of anorganization to facilitate the achievement of its goals. The challenge facing most organisations ishow to get the optimal output from each of its employee. In the past, the human component inorganisations was regarded as inconsequential, with very little attention in terms of organisationalresources allocated to its development, until the mid-twentieth century when efficient humanresource management started gaining importance as vital to the progress of organisations. Somestudies have shown direct linkage between Strategic Human Resource Management (SHRM)practices and firm performance (Edwards and Wright, 2001). Other studies, (Katou and Budhwar,2006) argue that SHRM practices do not lead directly to business performance but influenceemployee motivation, which ultimately influences their performance. Both studies show that firms’performance depends on its employee. This literature, delves into the transformation of Nigerianorganisations beginning first with its most important asset- its Human Resources. Nigeria is blessed with a population of about 150million people with 47.33million of thesegainfully employed (Nigerian Bureau of Statistics, 2009 Statistical Bulletin). However, ourproductivity level is just about 43%; this shows how the Nigerian worker is greatly under-utilised.Overview of Nigerian Organisations Nigerian organisations can be classified into three broad industries: Primary Industries,Manufacturing and tertiary industries. Primary industries consist of organisations involved in the exploration and, or extraction ofraw materials. Farming, fishing, mining, and oil exploration fall into this industry. At the subsistencelevel, basic human skill is required and so everyone engages in production. In order to increaseoutput, humans specialise and upgrade their skills. An efficient aggregation of the varying skills iscrucial to maintaining the increased output. Take Songhai farms in Kwara as an example, it employsVeterinary doctors, technicians and milkers. While the veterinary doctor is responsible for the healthof the cattle, the technician is in charge of maintaining all farm implements and the milker isresponsible for milking the cows. An efficient management of these skills has made Songhai farmsincrease milk production fivefold compared to the subsistence level. Essay written and submitted by Ukwuegbu Anthony Chijioke. Chijistar@gmail.com or 0818 212 0314 Department of Business Administration, University of Lagos.
  • 4. The manufacturing sector is responsible for converting the semi-processed goods or rawmaterials into finished goods for consumption. Nigerian organisations like Dangote cement,Unilever, Nigerian refineries and Honeywell fall into this industry. Great skill is required to convertgroundnut oil, limestone and wheat to butter, cement and bread respectively. According to theManufacturers Association of Nigeria (MAN), Nigerian manufactures operate at 27% of theirinstalled capacity. While blame may be attributed to our government, a good part of it can beattributed to the organisations themselves. Do they hire and retain the best talents? Does the workenvironment give the employee the opportunity to maximise his/her fullest potential? The tertiary sector on the other hand comprises all Nigerian organisations involved inrendering services like banking (Guaranty Trust Bank and Wema Bank), hospitality (Sheraton Hotelsand Transcorp Hilton Hotels), Education (University of Lagos and Providence Schools), plumbingand hairdressing to individuals and organisations. Because of the great deal of human interactions inthis industry, Nigerian organisations have invested in training programs that focuses on employee-customer relations. Within the last ten years (2000-2010) this investment has paid-off. Telephoneusers have grown from 400,000 to over 90million, Annual Air travellers has risen from 950,000 toover 4million and foreign investors have become major players in our hospitality industry. In order to maximise the opportunities around us, Nigerian organisations have to transform.They have to re-jig their system in order to significantly increase flight traffic from 4millionpassengers to the pool of 150 million other Nigerians not yet flying, they also have to retool theirfactory in order to increase manufacturing capacity to over 70% and maximise primary output. Noother place can this transformation process start than the organisations people-its Human Resources.The functions of HR All organizations have people; they have Human Resources. Regardless of the size of anorganization or the extent of its wealth, the organization survives and thrives because of thecapabilities and performance of its people. The activities and functions to maximize thesecapabilities and performances are necessary because members of an organization, regardless of itssize, will benefit from an effective Human Resource function. The HRM Function in an organizationplays the role of taking care of human capital. It is their responsibility that the organisation stayscompetitive on the external market and is internally efficient. It includes a variety of activities someof which include: Essay written and submitted by Ukwuegbu Anthony Chijioke. Chijistar@gmail.com or 0818 212 0314 Department of Business Administration, University of Lagos.
  • 5.  Human Resource Planning (Job Design and Analysis)  Staffing (Recruitment, Selection, Placement and Induction)  Compensation Management  Performance appraisal  Training and Development  Welfare Administration  Discipline Administration  Grievance handling and Labour relationsHuman Resource Planning (Job Design and Job Analysis): This is the systematic forecasting of anorganization’s future requirements for different types of workers in terms of skills acquisition,utilization and improvement, employee cost control, retention and supply.Staffing (Recruitment, Selection, Placement and Induction): This entails the systematic search forsuitable candidates to do a job and the provision of resources that will lead to a successful jobperformance of the hired candidate.Compensation management: This function deals with the development and maintenance of a goodand competitive salary and wage system.Performance Appraisal: A regular systematic and objective assessment of an employee’sperformance in order to review whether his/her performance matches the expected performancelevels. The finding determines the training needs of the employee.Training and Development: While training is the process by which employees are taught new skillsand knowledge for successful job performance, development is helping employees acquire theattitude and experience that will enable him/her undertake greater and more demanding roles andresponsibilities in the future.Welfare Administration: This is the provision of other facilities, apart from wages and salaries, to theemployee by the employer, to increase employees comfort. The facilities could include medicalfacilities, loan facilities, housing facilities, canteen facilities, etc.Discipline Administration: Like every social situation, humans usually tend to manifest unpleasantbehaviour. This makes it important to control the performance and behaviour of the employeesaccording to organisational rules. Essay written and submitted by Ukwuegbu Anthony Chijioke. Chijistar@gmail.com or 0818 212 0314 Department of Business Administration, University of Lagos.
  • 6. Labour relations and grievance handling: As a result of stress, workplace dissatisfaction or a feelingof unfair remuneration, tension could develop in the work place. Efficient grievance handlingrequires stemming this tension before it boils over. People are thus central to an organisations progress and an effective managerial system couldgreatly transform the organisation.Transforming Nigerian Organisations Every Nigerian organization contains different mix of people – dark people, fair people, tallpeople, slim people, Muslims, Christians and so on. Even within each category we would observeenormous individual differences. While some would be clever, others not so clever; some are whollycommitted to their jobs, others are partly committed. “The point is that these differences demandattention so that each person can maximize his or her potential, so that organizations can maximisetheir effectiveness and the society as a whole can make the wisest use of human resources.” (Cascio) The challenge facing organisations today is recognizing talent and nurturing it carefully inorder to achieve significant productivity gains over a period of time. The organisation is nothing butpeople. The economic recession, globalisation and technological innovation have changed thebusiness landscape dramatically. Given this scenario, organizations with similar set of resources gaincompetitive advantage only through effective and efficient use of human resources (Dessler). Inservice industries like financial services and hospitality discourteous employee response have ruinedrelationship with customers. Machines are fast replacing humans in production. It is the HRprofessional’s task to help the organisation in training its people for these emerging new roles. Essay written and submitted by Ukwuegbu Anthony Chijioke. Chijistar@gmail.com or 0818 212 0314 Department of Business Administration, University of Lagos.
  • 7. The HR transformation Model developed by Bath Consultancy Group In order to better understand how the HR can transform Nigerian organisations, we take a cuefrom The HR Transformation model developed by Bath Consultancy Group. As Strategic Partner,HR leaders need to be engaging others on future issues and opportunities, which face the business.They need to be facilitating the process and raising the challenge of how to deal with these. HR as a solutions provider takes an organization from its current and already known state intoan unknown future. To do this the HR broadens the conversation with Strategic Business Units(SBU) around ways of meeting the core needs of the organization in the future. During theconversation, it asks questions like “How will the dynamic business environment affect our futuresourcing of talents? How can we keep our employees skills relevant to our future organizationalneeds?” To effectively solve this task, HR will need to communicate its plans effectively acrossStrategic Business Units. It has to work on the mind of the employees to prevent them from closingtheir mind to innovation. This could be done by first improving the relationship it has with the peopleand building their self confidence. This will put them at ease. Also the tone and language with whichit puts the message across is important. Essay written and submitted by Ukwuegbu Anthony Chijioke. Chijistar@gmail.com or 0818 212 0314 Department of Business Administration, University of Lagos.
  • 8. As HR transforms the organization, it must make sure that it challenges the culture and styleof management. It needs to find the culture and styles of management that increases employeecontribution to organizational goals while balancing the delicate work-family demands. Bydeveloping mutual trusts, HR would be able to lead the organization into the future, forming awelcome strategic partnership. To successfully transform any Nigerian organization, its HR should ask itself these threequestions: I. Are we hiring the best candidate? II. Are our organizational policies good enough that it motivates the worker to stay with our organization and perform more? III. Do we constantly improve the skill and competence of our employee?Are we hiring the best candidate? As Nigerian organizations aim to be global competitors, this is oneof the biggest challenges they will face. Identifying candidates who can be more successful oreffective with the least amount of support depends on well written job descriptions. Individualdifferences and what motivates that particular candidate should also be taken into considerationduring the entire staffing process as this will be crucial in the transformation of the Nigerianorganization. At times, however, the most qualified candidate is usually not the best candidate.Are our organizational policies good enough that it motivates the worker to stay with ourorganization and perform more? Once the best candidate has been employed, the next thing on theHR’s managers’ mind should be “How do we keep this employee with the organization and preventhim or her from being poached by other organizations?” In fact, most Nigerian organizations find itdifficult retaining their best talent especially when mouth-watering offers are made by multi-nationals. To transform an organization, the HR manager has to be able to hold-on to its prizedtalents long enough for them to have a lasting legacy in that organization. Football clubs likeManchester United and Barcelona who have learnt how to hold on to their best talents go aboutwinning trophies, while clubs that can’t hold on to their best talents, like Arsenal, end up withvirtually no silverware. A fair and objective remuneration structure could retain the employee. Soalso will benefits attached to the job (like credit, housing and medical facilities), the grievancehandling procedures, job promotion and work place culture all play a crucial role in the employeesmind should another offer come. An effective interplay of these factors will better retain employees. Essay written and submitted by Ukwuegbu Anthony Chijioke. Chijistar@gmail.com or 0818 212 0314 Department of Business Administration, University of Lagos.
  • 9. Do we constantly improve the skill and competence of our employee? This is the same as asking,How good is our training and developmental program? With Nigerian organizations being in adynamic environment, the need to keep the employee skill and knowledge abreast with thisdynamism has become imperative. HR should develop training and developmental strategies thatprevent employee skills from going obsolete while also increasing their abilities to handle greatertask and responsibility. An effective training regime takes into consideration individual strengths andweaknesses, in terms of their skills or technical abilities, competencies, flexibility etc., and relating itwith present and planned job tasks and organizational goals. Human Resources Development is acontinuous combination of training and education that ensures the continual improvement andgrowth of the individual, the organization, and the national human resourcefulness. Adam Smithstates, “The capacities of individuals depended on their access to education”. As Nigerianorganizations aim to become global players, they will need to assess their employee capacity(through performance appraisal) with the anticipated requirements and come up with training anddevelopmental schedules on how to bridge the gap. This is the task of the Human Resourcedepartment. Human Resources Development is a series of organized processes, “with a specificlearning objective” (Nadler, 1984).Guaranty Trust Bank and Wema Bank: A case study of two banks from their Human Resource policies. Guaranty Trust and Wema are both indigenous commercial banks with Wema bank (Wema)founded in 1945 while Guaranty Trust Bank (GTB) was founded in 1990. With 66years of bankingexperience, one would expect Wema to be a major player in the Nigerian financial market. But this isa far cry from what operates in reality. GTBank boast of an asset base in excess of N1,066 billion(GTBank, 2010 Annual Report). Wema has a little over N205 billion in its asset portfolio (Wemabank, 2010 Annual Report). Wema was reportedly alleged to being one of the 10 Nigerian banks inneed of recapitalization. While Wema is only visible in the South-Western part of the country, GTBhas become an International bank with branches across Africa-The Gambia, Liberia, Sierra Leoneand Ghana, and Europe. GTB shares are listed on both the Nigerian and London Stock exchangesand it possesses the highest rating given to any Nigerian bank on its debt of BB- by Standard &Poors and AA- by Fitch Ratings. A number of human resource policies have been the bedrock ofGTB success, some of which are: Essay written and submitted by Ukwuegbu Anthony Chijioke. Chijistar@gmail.com or 0818 212 0314 Department of Business Administration, University of Lagos.
  • 10. Employee training program: Yearly, GTB goes to university campuses scouting for talents to hire.These new recruits are made to undergo a three month period of rigorous and elaborate trainingbefore they are hired. During the training, the GTB superior work ethic is imbibed into the employee,creating a platform for successful job performance. Wema on the other hand has a very laxrecruitment process. It’s training schedule last for just two months and most times bypassed. GTB’straining doesn’t just end once the employee is employed, it begins there. Most times employees arerotated across departments and sent overseas for refresher courses.Wage Structure: The entry level pay at GTB is about N3,000,000 per annum while at Wema it is alittle over N1,000,000. Research has shown that salary has a way of allocating talent acrossorganisations. The best talents tend to go to places where they are compensated the most, leavingothers to organisations with lesser compensation packages. With a larger pool of top quality talentthan Wema, it follows that in the long run GTB will continue to do better especially when this talentmature in the organisation.The work environment: GTB emphasises on its people as central to its success and ensures it engagesin policies that bring out the best in them. Its aesthetically well designed branches, the level ofautonomy given to its employee, employee-employee relationship, the multi-ethnic composition ofits workforce all create a sense of distinction and comradeship among the employees. The employeespass on this feeling by delivering superior services. Wema has largely lagged behind its peers in thisarea, its branches are built with little or no regard for aesthetics, the employees’ attachment to theWema brand is weak, and the workforce tilts towards one ethnic group frustrating people from otherethnic group to leaving even if they possess unique talent. Organizations willing to gain the comparative advantage in the dynamic Nigerian businessenvironment should take a cue from GTB and invest properly in its people and it will definitely reapthe benefits overtime. Essay written and submitted by Ukwuegbu Anthony Chijioke. Chijistar@gmail.com or 0818 212 0314 Department of Business Administration, University of Lagos.
  • 11. Conclusion In a nutshell, Human resources describes’ the individuals who make up the workforce of anorganization. With people being the ones who coordinate all the functions of the organizations,transforming an organization should start from them. Human Resources Development is simplydeveloping the most important section of any business, its human resource, by attaining or upgradingemployee skills and attitudes at all levels to maximize enterprise effectiveness. GTBank has shownthat once employee skills and attitude are developed, organisational goals will be attained and thefirm will be better transformed to achieve its organisational goals.ReferencesAurora. (2010, June 9). Functions of Human Resource Management. Retrieved August 20, 2011,from http://www.tutebox.com/category/business/management/Bank, Guaranty Trust. (2010). Annual Report, Lagos.Bank, Wema. (2010 ). Annual Report, Lagos.Banjoko, S. (1996). Human Resource Management: An Expository Approach. Lagos: PumarkEducational Publishers.Bath Consultancy Group. (1999, June 13). HR Transformation Model. Retrieved August 28, 2011,from www.bathconsultancygroup.comCascio, W. F. (1991). Costing Human Resources: The Financial Impact of Behaviour inOrganizations. Boston : PWS-Kent Pub. Co.Cascio, W. F. (2003). Managing Human Resources: Productivity, Quality of Work Life, Profits.Denver: McGraw Hill Publishers.Central Bank of Nigeria, . (2007). Statistical bulletin .Dave Ulrich, J. A. (2009). HR Transformation. Michigan.Dessler, G. (2001). Human Resource Management. Singapore: Pearson Education Asia Pte. Ltd.Edwards, P. a. (2001). High-involvement work systems and performance outcomes: The strength ofvariable, contingent and context-bound relationships. International Journal of Human ResourceManagement , 568-585. Essay written and submitted by Ukwuegbu Anthony Chijioke. Chijistar@gmail.com or 0818 212 0314 Department of Business Administration, University of Lagos.
  • 12. Fajana, S. (2006). Human Resource Management: An Introduction . Lagos: Oguns Printers.Institute of Strategic Management of Nigeria, I. o. (2010). Strategic Management Training Pack.Lagos : ISMN.Katou, A. a. (2006). Human Resource Management Systems on Organizational Performance: A Testof Mediating Model in the Greek Manufacturing Context. International Journal of Human ResourceManagement , 1223-1253.McNamara, C. (2011, August 1). All About Human Resources and Talent Management. RetrievedAugust 20, 2011, from http://www.managementhelp.org/humanresources/Nadler, Ed. L. (1984). The Handbook of Human Resources Development. New York: John Wiley andSons . Essay written and submitted by Ukwuegbu Anthony Chijioke. Chijistar@gmail.com or 0818 212 0314 Department of Business Administration, University of Lagos.