Objectives To know the importance of Human Resources as an investment to service businesses. To know the strategic importance of recruitment, selection, training, motivation and retention of employees. To understand meant by the control and involvement models of management. To know when strategy of empowering employees appropriate, benefits and implications. To understand the different approaches to human resources management affect customer satisfaction and retention.
Human Resources: An AssetWorth Investing In Behind most of today’s successful service organizations stands a commitment to effective management of human resources, including the recruitment, selection, training and retention of the employees.
Role of Frontstage PersonnelA single employee may play many roles. They may be part of the product, part of the delivery system adviser and teacher and even.
Emotional Labor “This is the work done with feelings, as part of paid employment.” - Arlie Hochschild (The Managed Heart, 1983)
Job Design and Recruitment The Goal of job design is to study the requirements of the operation, the nature of the customer needs, the capabilities of the employees and the characteristics of operational equipment.
Recruiting the Right Peoplefor the JobSeveral special characteristics may be important in recruiting and training employees. These include interpersonal skills, personal appearance and grooming, voice, knowledge of the product and the operation, selling capabilities and skills.
Employee Retention: ServiceJobs as Relationships
The Concept of ExchangeApplied to Employment pay health insurance pension funding
Other job benefits: learningcompanionship meeting new people
Other job benefits: travel social contribution
EmployeeRetention is an effort by a business to maintain a working environment which supports current staff in remaining with the company. http://www.businessdictionary.com/definition/employee-retention.html#ixzz2KD8AG2XT
CustomerRetention is an assessment of the product or service quality provided by a business that measures how loyal its customers are. http://www.businessdictionary.com/definition/customer-retention.html#ixzz2KKGG66DQ
Cycles of Failure,Mediocrity andSuccess cycle of failure businesses with high employee turnover cycle of mediocrity organizations which offer job security but little scope for personal initiative cycle of success if managed well, there is potential for a virtuous cycle in service employment
The Cycle of SuccessSome firms take long-term view of financial performance,seeking to prosper by investing in their people in order tocreate “cycle of success”.
The Cycle of Success • With more focused recruitment, more intensive training and better wages, employees are likely to be happier in their work and to provide higher quality, customer- pleasing service. • Regular customers also appreciates the continuity in service relationships resulting from lower turnover and so are more likely to remain loyal. • In many countries, once-mediocre public corporations have undergone radical culture change in the wake of privatization and exposure to a more competitive environment.
How to Manage People forService Advantage? Staff performance is a function of both ability and motivation. How can we get able service employees who are motivated to productively deliver service excellence?
The role of Unions• For innovations in the way a firm’s employees are organized and managed to realize their full potential, employee cooperation is often essential.• Many managers seem to be rather antagonistic toward unions.• Many of the world’s most successful service businesses are, in fact, highly unionized. The presence of unions in a service company is not an automatic barrier to high performance and innovation unless there is a long history of mistrust, acrimonious relationships and confrontation. However, management consultations and negotiations with union representatives are essential if employees are to accept new ideas (conditions that are equally valid in non-unionized firms, too). The challenge is to work jointly with unions, to create a climate for service.
EMPOWERMENT OFEMPLOYEES• How important is the much advocated practice of empowering employees to use their own discretion to serve customers better?• From a humanistic standpoint, the notion of encouraging employees to exercise initiative and discretion is an appealing one.• Empowerment looks to frontline staff to find solutions to service problems and to make appropriate decisions about customizing service delivery.• It depends for its success on what is sometimes called enablement-giving service workers the training, tools and resources they need to take on these new responsibilities.
Is Empowerment AlwaysAppropriate?• Advocates claim that the empowerment approach is more likely to yield motivated employees and satisfied customers than the “production-line” alternative, where management designs a relatively standardized system and he expects workers to execute tasks within narrow guidelines.• Different situations may require different solutions, declaring that “both the empowerment and production-line approaches have their advantages...and... each fits certain situations. The key is to choose the management approach that best meets the needs of both employees and customers”.
Control versus Involvement •The production-line approach to managing people is based upon the well established “control” model of organization design and management. •Empowerment, by contrast, is based upon the “involvement” (or “commitment”) model, which assumes that most employees can make good decisions and produce good ideas for operating the business, if they are properly socialized, trained and informed.
Control versus InvolvementIn the control model, four key features are concentrated at the top ofthe organization, while in the involvement model these features arepushed down through the organization. The four features are: 1. Information about organizational performance (e.g., operating results and measures of competitive performance). 2. Rewards based on organizational performance (e.g., bonuses, profit sharing and stock options). 3. Knowledge that enables employees to understand and contribute to organizational performance (e.g., problem-solving skills) 4. Power to make decisions that influence work procedures and organizational direction (e.g., through quality circles and self-managing teams).
Levels of EmployeeInvolvement• The empowerment and production-line approaches are at opposite ends of a spectrum that reflects increasing levels of employee involvement as additional knowledge, information, power and rewards are pushed down to front line. Empowerment can take place at several levels: 1. Suggestion Involvement 2. Job Involvement 3. High Involvement
Levels of EmployeeInvolvement • The empowerment and production-line approaches are at opposite ends of a spectrum that reflects increasing levels of employee involvement as additional knowledge, information, power and rewards are pushed down to front line. Empowerment can take place at several levels: 1. Suggestion Involvement Suggestion Involvement •Employee recommendation 2. Job Involvement 3. High Involvement
Levels of EmployeeInvolvement • The empowerment and production-line approaches are at opposite ends of a spectrum that reflects increasing levels of employee involvement as additional knowledge, information, power and rewards are pushed down to front line. Empowerment can take place at several levels: 1. Suggestion Involvement -Jobs redesigned 2. Job Involvement 2. Job Involvement 3. High Involvement -Employees retrained -Supervisors facilitate
Levels of EmployeeInvolvement • The empowerment and production-line approaches are at opposite ends of a spectrum that reflects increasing levels of employee involvement as additional knowledge, information, power and rewards are pushed down to front line. Empowerment can take place at several levels: 1. Suggestion Involvement •Information is shared 2. Job Involvement •Employees skilled in 3. 3. High Involvement High Involvement teamwork, problem solving etc. •Participate in decisions •Profit sharing and stock ownership
HUMAN RESOURCEMANAGEMENT IN AMULTICULTURAL CONTEXT•The trend toward a global economy means that more and moreservice firms are operating across national frontiers. Otherimportant trends are increased tourism and business travel andsubstantial immigration of people from different culturalbackgrounds into foreign countries. The net result is pressure onservice organizations to serve a more diverse array of customers.These customers have different cultural expectations and speak avariety of languages. A more diverse workforce has also to berecruited.•Striking a balance between diversity and conformity to commonstandards is not a simple task, since societal norms vary acrosscultures.•Part of the HR challenge as it relates to culture is to determinewhich performance standards are crucial and which should betreated more flexibly.
CONCLUSION Successful service organizations arethose that are committed to effectivemanagement of human resources (HR),including recruitment, selection, training andretention of employees. They recognize thatservice personnel play an important role increating customer satisfaction andcompetitive advantage.
CONCLUSION It is probably harder to duplicate high-performancehuman assets than any other corporate resource.Winning service organizations have employees whounderstand and support the goals of an organization,have the skills needed to succeed in performing theirjobs, work well in teams, recognize the importance ofcustomer satisfaction and have the authority and self-confidence to use their own initiative to solve theproblem. In the following chapter, we examine theleadership task of integrating marketing, operations andhuman resources in a strategic partnership.