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Strategic Management of Human Resources ASSIGNMENT PAPER
UNIVERSITY OF SUNDERLAND SUNDERLAND BUSINESS SCHOOL
Module Code : HRM325
Module Title : Strategic Management of Human Resources
Hand in Date : Friday 8th January 2010
INSTRUCTIONS:
Section A: Answer all questions - Case Study (40 marks) – 2500 words
Section B: Answer TWO questions from FOUR - essay and report questions (60 marks) – each question should be completed in no more than 1750 words each.
THE UNIVERSITY'S REGULATIONS CONCERNING CHEATING, COLLUSION AND PLAGIARISM APPLY TO THIS ASSESSMENT
SECTION A
Read the following case study and then read and answer Question 1.
Hard Candy
Cadbury Schweppes is the first to admit it has a hard centre when it comes to making a profit – though it puts people issues higher up the agenda than many 'softer' companies (Cadbury Schweppes started life in the Midlands of the UK in the 19th Century. As an employer it established its reputation as a ‘model’ Family employer adopting highly paternalistic human resource policies within the then Quaker tradition of employment maintaining a tradition of providing considerable benefits for employees ranging from housing to advanced factory conditions and welfare rights. As the business has grown and acquired a wide range of non Cadbury originated businesses the strategy has been adapted to fit the worldwide competitive situation it finds itself in.
Date: 26 January 2006
Cadbury Schweppes may be a leader in the confectionery market but it isn't all sugar, spice and all things nice. Its "number one goal for 2004-07" is not about excellence, innovation or developing its people. It is simply "to deliver superior shareholder performance".
As befits a company focused on its shareholders, Cadbury Schweppes is ranked 26th in the FTSE (UK Financial Times Stock Exchange Listings)-100. This reflects the fact that, so far, its main goal is being achieved – full-year results for 2004 showed turnover was up by 5 per cent to £6,738 million, and underlying operating profit was up 6 per cent to £1,115 million.The Essay is provided by UK Assignment http://www.ukassignment.org
The interesting thing about Cadbury Schweppes though is that, despite being so geared towards dividends, it is also one of the few FTSE companies with an HR director – Bob Stack – on the main board. So perhaps HR and profit are not such strange bedfellows after all.
But this isn't HR as usual. Take Andrew Gibson, for example. He doesn't come across as the aggressive type, but it must be in his make-up somewhere. Why? Because he was promoted earlier this year to the role of HR director for Cadbury Schweppes (GB & Ireland).
That's not to say that all Cadbury Schweppes HR directors are Mike Tyson (former World heavy weight boxing champion) in disguise – more that the company openly looks for aggression in its leaders. In fact, that's one of its core leadership behaviours. And since Gibson has risen through the ranks in the space of 13 years – he joined the company in 1993 as a senior personnel officer in distribution and logistics – he must have something of a determined streak in his character.
The company's leadership behaviours were developed when former chief executive (now chairman) John Sunderland launched a programme in 1977 called Managing for Value. As the name suggests, this aimed to increase employees' understanding of how the company could be more profitable.
"We'd talk about being the three As," recalls Gibson. "These are: accountable – really owning rather than saying: 'It's not mine, it's someone else's'; adaptable – coping with the changing world and changing your skills as required; and aggressive, which in this context is about being results-focused and tenacious."
The third A-word crops up again when Gibson explains how tough the market is. "It's a very fast-moving world; a very competitive marketplace. To lead that you need to drive results, be commercially focused on growth and be aggressive."
"Results-focused" is certainly something every Cadbury Schweppes employee has to be. "Most people understand we are a listed company and we have a set of financial goals," says Gibson. "The Managing for Value programme brought that home. Employees went on a five-day programme that linked their work to those goals. A lot of our work in HR is about making sure people understand the context the business is operating in."
To reinforce that message, the company has two share schemes, each with a high take-up. One of them, ShareSave, has been operating since 1974. The schemes are open to everyone on a permanent contract and mean that people have a vested interest in the organisation doing well. And the company's shares can be worth having. If an employee had invested £25 a month in ShareSave in 1985 under a five-year plan, and the same amount each year after that under the same terms, they would have received 18,766 shares by now, with a current market value of £100,000.
Certainly, employees don't seem to mind the profit-driven approach. Last year Cadbury Schweppes launched its first global climate survey. Gibson says: "Well over 90 per cent of employees said they understood the business's purpose and values and its local priorities; were proud to work for the business; and felt part of a team.
"These were really strong results, especially at a time of great change, when you expect some fracture. That's testament to some of the programmes we’ve run and how we embrace change rather than fear it."
The business has certainly been through a huge amount of change – not least the acquisitions of confectioners Trebor Bassett and Adams. At $4.2 billion, the purchase of Adams in 2003 was the biggest acquisition Cadbury Schweppes had made. At the same time the company went through a major reorganisation, moving to a more decentralised way of operating business units within a new structure based on five global regions.
Recalling that all this was done in aThe Essay is provided by UK Assignment http://www.ukassignment.org
relatively short space of time, Gibson again returns to that A-word. "It was quite an aggressive set of things to achieve in that timescale," he says.
He makes it clear that HR had an important role in bringing the two businesses together. "Both had a distinctive culture. Rather than say we'd go for one or the other, we got the two management teams together to ask: 'What kind of culture do we need to be a winning business?'
"We did this because when people own it, they're more engaged with it, as opposed to it being imposed on them. We had a few sessions where we discussed this. We then came up with a set of ways to behave in order to win."
Out of this came a framework called Working Better Together, which provided more than 50 online tools for people to undertake in order to work more collaboratively than they were used to, in a more decentralised business structure.
"An element that came quite strongly out of this work was that we had a great business, great people and great brands, but we didn't necessarily get everything we could out of our people. We didn't always unlock their potential. The need to focus on motivating and adopting a coaching
approach to doing that – a joint problem-solving approach – really came through as a strong theme."
The realisation that the company could get more from its staff resulted in another programme, Growing Our People, a three-day workshop that several hundred managers have now taken. "We often hear managers saying it was an important factor in our success in the past three years. Some pretty tough managers, who would usually only talk about hard-nosed financial results, said the focus on behaviours and unlocking the potential of people at different levels of the business had really paid dividends."
If that makes you think Cadbury Schweppes has gone soft, think again. Adding to the impression that the people who work there are a tough bunch, Gibson reveals that the climate survey (staff attitude survey) wasn't all good news for the HR team. It did reveal one large area of dissatisfaction – people felt that poor performance often wasn't confronted or dealt with.
To tackle the problem, the company is about to introduce a programme called Passion for People, which looks at the mechanics of managing performance. "It's almost creating a Cadbury Schweppes way of approaching people management issues," says Gibson.
While the firm's main priority is shareholder performance, its fifth-placed priority is to enhance its reputation with staff and society. There are bound to be times when the two are in conflict. For example, Cadbury could embrace the Fairtrade movement for the sake of its reputation, but its profits would be hit.
Gibson takes a pragmatic stance. "The abolition of any poor working practices is something we take very seriously. We support many government bodies and interest groups on this. I don't think our stance is in conflict with Fairtrade; it's just different.
"We are a business: we exist to make a profit and we're a global leader in confectionery. But I don't think that contradicts having a strong value set. We won't handle everything perfectly but our track record has been strong. We want to be fair, but we do have to make difficult decisions in the interests of our stakeholders."
Gibson stresses the benefits of working in a company where HR is on the board and represented at every regional business unit. He reports to the managing director of Cadbury Schweppes (GB & Ireland), as well as to the EMEA regional HR director, who in turn reports to the main board.
"Having the link through HR to the main board is extremely important," he says. "When we undertook the Adams acquisition, for example, a lot of thought went into the culture of the business and whether it would fit in. That's the nature of the way we undertake change. We think very hard about the people considerations."
Gibson argues that having Stack on the main board means HR has a well-informed, global direction on certain issues, but also that top-down programmes combine with local, bottom-up initiatives.The Essay is provided by UK Assignment http://www.ukassignment.org
The environment at Cadbury Schweppes might be tough, but it brings its own rewards. "It's about people adding value at every level in the business," says Gibson. "That's why I love working here – you have the freedom to do what's right, either locally or regionally, as well as seeing the global picture."
About the company
Cadbury Schweppes employs more than 50,000 people (7,000 in the UK) and has manufacturing operations in more than 35 countries. It is the world's third largest soft drinks company and holds either the top or second position in the market share of 24 of the world's top 50 confectionery markets. Its brands include Cadbury, Schweppes, Trebor, Bassett's, Trident, Dr Pepper, Halls, Dentyne, Snapple, Orangina, Bubblicious and 7UP.
In the UK it is the clear leader in the confectionery market* with a 29.5 per cent market share, ahead of major competitors Masterfoods (19.7 per cent) and Nestlé (14 per cent).
*AC Nielsen, October 2005
Adapted from an article in the UK People Management Magazine – January 2006
Answer all of the following questions for Section A, Question 1:
1.1) Assess the fit of Cadbury’s approach to managing its human resources and its business strategies with reference to relevant models of SHRM
(10 marks)
1.2) Using your knowledge from Unit 8 and the related information about managing effective change evaluate the organisations approach to change assessing its impact and the role played by SHRM techniques and processes ?
(20 marks)
1.3 From your knowledge of the course how does the HR Function seem to be supporting the Business Strategy at Cadbury’s ? In general how can HR best support an organisation going through change ? (10 marks)
SECTION B
Answer TWO questions from this section
2) What is the value to organizations in creating a learning organizational culture’ ? How can organizations work towards creating this culture through its HRM/HRD Strategies ?
(30 marks)The Essay is provided by UK Assignment http://www.ukassignment.org
3) Why is human resource planning be such an important an aspect of SHRM?
(30 marks)
4) To what extent can performance management systems stand alone from an organizations overall approach to developing and managing people ? How can organizations integrate the performance and developmental aspects of managing people ? Use case examples to illustrate your answer.
(30 marks)
5) Is it realistic to integrate industrial/employee relations activity within SHRM? How might organizations attempt to do this ?
(30 marks)
END OF ASSIGNMENT PAPER
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