Graduate Business School

Assignment Cover Sheet

Student name: Sumeet Duhan

Student number: 2804324

Course: MSC INTL Business Stage/year: 1

Subject: Strategic Human Resource Management

Study Mode: Full time Yes Part-time

Lecturer Name: Jackie Kennedy

Assignment Title: Jameson Irish Whiskey

No. of pages: 14

Disk included? Yes No

Additional Information: (ie. number of pieces submitted, size of assignment, A2, A3 etc)

Date due: 25th Nov 2011

Date submitted: 25th Nov 2011

1 | P a g e

Jameson Irish Whiskey

TABLE OF CONTENT

Page no

1. Introduction ……………………………………………………………………………………2

2. Executive Summary……………………………………………………….………………..….2

3. Strategic HR Plan……………………………………………………………………….……..3

3.1Strategic Resourcing………………………………………………………………….……….3

3.2 Reward Management………………………………………………………………….……...5

3.3 Performance Management and Performance Appraisal………..…………………………….6

3.4 Learning, Training and Development…………………………………………………….…..8

4. Application of SHRM Model………………………………………………………………….9

4.1 Best-Fit HRM………………………………………………………………………………...9

4.1 Schuler’s Employee Behavior Model……………….…………………………………..…....10

4.2 Merits and Demerits of Best- Fit HRM………………………………………………………10

5. Conclusion……………………………………………………………………………………..11

6. Reference………………………………………………………………………………………12

7. Bibliography…………………………………………………………………………………...14

2 | P a g e

INTRODUCTION

Jameson is produced by French distiller ‘Pernod Ricard’ it is a single distillery Irish whiskey.

Jameson was established at Street Distillery in Dublin in 1780 by John Jameson established.

Jameson nowadays distilled in Cork, but vetting still takes place in Dublin. Jameson has annual

sales of around 31 million bottles, which makes Jameson the best selling Irish whiskey in the

world. In 19th century John Jameson along with his son started producing a million of gallons

annually when they started selling it internationally. In 2010 Jameson sold over cases of whiskey

in US alone. Today Jameson is the third largest selling single distillery in the world.

EXECUTIVE SUMMARY

China is the one of fastest growing markets in the world weather it automobile, food or alcohol.

China’s alcohol market is increasing rapidly it has rose rapidly from last year i.e. 2010 with rise

of almost 37 % since 2010. Increase in sales clearly indicates the constant increase in demand for

quality spirits. After studying market statistics and comparing figures with long consideration I

decided to launch Jameson in China to help Jameson reach its annually also to become became

Alcohol Industry by penetrating new markets like China (PRWEB 2011).

HR Director of Jameson will formulate the companies HR Plan in coming two years to enter

china market. For this HR will undertake various step including strategic resourcing, reward

management, performance management and learning, training and development.

As we all know there is rapid growth in the size and status of the Chinese Market so therefore

this will bring huge demand for human capital. Almost every multinational company in China

faces common HR challenges as China lacks qualified talent to meet foreign employers demand.

McKinsey Global Institute 2006 study shows that very little percentage almost less than 10

percent of the new Chinese University graduates have the skills required by multinational

companies. So we can easily make out that foreign firms in China often face problems in training

and retaining employee in China. (www.chinabusinessreview.com)

3 | P a g e

So after keeping all these factors in mind our team suggests HR Director of BSS to consider a

total rewards strategy to retain efficient employees and to lay emphasis on training and

development of employees. Finally I will study Chinese market in detail and will try to apply the

Best FIT HRM model to Chinese market.

STRATEGIC HR PLAN

Strategic Human Resource Management , with the development of a strategic business approach for the

operation of company personnel (Patrick G, Noreen H & Michael M, 2006), is scheduled to be done here

in a way to supplement the main strategy of the business. A detailed plan is prepared for this application

is mainly focused for the next two years. Includes the main practices in human resources and how these

can be well implemented in Jameson.

Strategic Resourcing

To start with human resource management, the initial processes include recruitment and selection. The

international success of a company depends largely on human capital allocation more appropriate at the

right time and right place (Duerr M, 1986). At the beginning of a business, or when some employees

leave or other more personal needs, recruitment and selection is the initial stage. The recruitment and

selection of employees in the Chinese labor market has been especially difficult given rotation rate

increased (Wang, X., Bruning, NS & Peng, S., 2007). Resources employees have to be done at all levels

of management as Jameson is the creation of a new subsidiary and as always almost the entire recruitment

and selection of management at both operational and half is done locally. However, in case of high level

management, it is worth giving a thought whether to carry out inside or outside recruitment (Scullion H,

1994).

Depending on the business strategy to provide high quality products, the effect on recruitment and

selection procedures will be to conduct an explicit analysis of work, as is evident from the model of

Schuler Employee Behavior (1987).

Recruitment

"Recruiting is defined as seeking and obtaining potential job candidates in sufficient numbers and quality

so that the organization can select the right people to meet their work requirements" (Shen J. & V.

4 | P a g e

Edwards, 2004).

Attract eligible persons, preventing the wrong people and maintaining the employer brand is the main

purpose of recruitment, it is always desirable that such a low cost way (Torrington, D., Hall, L. & Taylor,

S., 2001). Jameson will have to come through the process of hiring a profitable and efficient.

First, the Jameson that the design of the different jobs to cover the organization and provide a

good description of the jobs and the requirements for eligibility of employees. We need to

employ staff at all levels of management rights from the management level to operational levels.

However, China is an important market attractive to companies around the world, no

competition, even for the acquisition of the large force of skilled labor. The terms and conditions

should not refuse to consider this fact because they may deter good candidates for the application

to be part of Jameson.

Much of the staffs at all levels of management can be rented from the Chinese labor market and the

Chinese staff would have a better understanding of the Chinese market.

 Selection

"Selection is the process of gathering information for the purposes of evaluating and deciding who should

be employed in certain jobs" (Dowling et al., 1994).

Jameson will have to focus primarily on interviews, psychometric tests and benchmarks for the selection

of candidates. Interviews were conducted in a structured way, but nice to provide a reasonable view to the

applicant about the job and collect the details of his / her (Torrington, D., Hall, L. & Taylor, S., 2001).

Psychometric testing is used primarily to evaluate the aptitude of the applicant. This also helps in the

analysis of personality and its importance in the organizational context. The end-use reference helps to

verify the facts and the nature of control of a person who can be anyone who is familiar with the

applicant, as the former employer or any official in any previous institutions such as schools, universities

and so on.

After implementation of these screening methods, the final decision will be based on job specifications

meet the participant. The employee selected will be sent an offer of employment with the employment

contract. The rejected candidates are thanked for their interest in Jameson as this will help create a good

image as an employer.

5 | P a g e

Reward Management

“Reward management is concerned with the formulation and implementation of strategies

and policies that aim to reward people fairly, equitably and consistently in accordance with their

values to the organization” (Armstrong M. & Hay Group., 2007). It is also essential to manage

the reward system as it has the ability to attract and retain staffs, affect the profit and most

importantly the motivation of the employees thereby affecting their behaviour and performance

leading to attainment of the organizational goals (Torrington D., Hall L. & Taylor S., 2001).

In the past time, reward was considered to attract, retain and motivate staff (CIPD, 2010). Now a

days, salaries play the important role to attract people to a certain job, benefits kept them on the

job and bonuses motivated them to work better and harder. According to Bratton and Gold

(2003) reward management is a core facet of the employment relationship (sandersaar 2010).

In China, many companies are throwing lot of money on their most skilled and desirable

employees to retain them and often employees are promoted beyond their skill level. Many

companies do not pay sufficient attention to training, career development, and pay for

performance. Besides this companies should consider a total reward strategy, which consider not

only bonuses and salaries, but also benefit packages, training and career development

opportunities, other long and short term incentives.

As the competition is very high because of the tight market so an efficient reward system should

be developed. After providing all the training then as a company you cannot lose a potential

employee.

Scope of Reward Management

1. Pay: It describes to the salary that an employee get. I have to make sure that employees

receive salary according to their responsibility and capability and also keep an eye on our

competitors what they are paying??

6 | P a g e

2. Incentives: It defines that giving the reward to an employee whose efforts outcomes in

higher performance than expected performance. Incentives will motivate and encourage

employees to perform better again and again.

3. Benefits: It refers to indirect rewards such as pension premium, insurance cover that an

employee gets as a part of the organization. Presently, employees are giving more

preferences to extra benefits that come with salary package. Before joining any

organization they review the overall package.

The pay levels of the efficient and skilled employees will be higher in China because of the fear of skilled

employees, high gross domestic product rate and also company needs to retain employees so it might pay

more.

Jameson has to continue their employees motivated at all times to crop high performance of the overall

organization. In the Maslow’s need hierarchy and the hygiene factor in the Herzberg’s two factor theory,

the extrinsic reward like pay can be a motivator like the physiological needs, even though this is not a

motivator but still avoids dissatisfaction. However, both monetary and non-monetary rewards will be used

to motivate the employees.

Performance Management and Performance Appraisal

Performance Management System

Performance management system is the process whereby the performance of individual of

individuals are controlled and motivated through the establishment of a support structure

(Torrington D., Hall L. & Taylor S., 2001). In short, it leads to the achievement of the

organizational needs in an efficient manner. The line manager will be responsible to do the

performance management and will have to fulfill various duties. These include setting standards

and objectives and communicating these to the employees, supporting the in meeting the

expectations through coaching, mentoring and other ways, assessment of their performance and

7 | P a g e

giving feedback and advice for continuous improvement of their performance. The HR manager

will be supporting the line manager in framing and carrying out these responsibilities.

Jameson will be executing a series of processes for performance management. Primarily,

performance objectives will be set on the basis of business strategies and other departmental or

individual objectives in a well described manner. Then, with the set objectives the results will be

analyzed and then feedback will be given to the employees stating their performance and

opinions. Through positive and negative feedback the continuous improvement will be

facilitated. The next process is linking reward to the performance based on the contribution of

every individual. The last and the final stage involves making essential changes onto the

objectives and the operations as Jameson will be continuously changing the strategies in

harmony with the changing environmental situations in China. Moreover, meetings would be

done continuously discussing the performance over the last six months or the year based on the

feedbacks and sharing ideas for the future improvement and development.

Performance Appraisal System

Performance appraisal system is one of the unique methods to measure the performance of the

employees. There are different aspects on which performance can be measured such as behavior,

personality, and job performance and communication skills. This is usually measured on yearly

basis with each line manager appraising the performance of their employees. This usually

requires the manager and the staffs to take part in a performance review meeting.

Moreover, the appraisal system is expected to deliver in so many fields as suggested by the

Employment Studies Institute (IRS 2001). Systems may focus on development, reward,

identifying future potential, motivation or identifying poor performers. According to the IRS

survey (IRS 2003), 40% of the private sector companies used appraisal for both development and

pay. This will be conducted in the simplest of forms, ranking method as a mean of competency

based system and keeping of the performance standard and objective (Redman T & Wilkinson A,

2006).

8 | P a g e

360-DEGREE FEEDBACK

With this approach we use the different type of sources from which feedback can be collected

about any individual. Feedback is collected from every aspect on the way that the individual

carries out their job like from line manager, subordinates, peers, internal customers, external

customer, senior managers and from individual themselves.

This feedback gives a better way to capture the complexities of performance stated by Atwater

and his colleagues (2002). Edward and Evan (1996, p.4) states that “no organizational action has

more power for motivating employee behavior change than feedback from credible work

associates”. With this individual understand how they may be seen different by different

organizational groups, and how this may contrast with their own ideas of their strengths and

weaknesses. So this feedback approach provides great information for the development of self-

awareness.

Hence 360 degree feedback will be a truly powerful tool to measures the performance of the

employees and also makes them aware of their strengths and weaknesses.

Learning, Training and Development

According to Foot & Hook (2009), learning and development is one of the main aspects in better

performance. Training and development mostly done to increase the employee’s motivation, to adopt

latest methods and technologies, to increase effectiveness in processes, to reduce employee turnover, gain

employee’s knowledge, innovation in strategies/products etc. (McNamara, 2010).

As we know that China is large pool of labor and we can get cheap labor here and no need to spend high

on the training and development of employees (Landy F. & Conte J., 2007). At the same time Jameson

will be keen to develop its productivity and to achieve its accomplished growth therefore training and

development is essential to bring the man force into real quality. The series of knowledge, aptitude and

competencies of the employees are developed through the training and development programs and

9 | P a g e

different stages are involved in this program. Firstly, Jameson has to find the training needs of its

employees relating to the attitude, knowledge and skills they must possess. Secondly, the requirements

should be screened and only the suitable requirements for the operations of Jameson should be considered

for the enhancement by training. Then after that the objectives and plans for training should be set and the

training techniques should be designed.

For the design purpose, divide the employees into four categories based on how learning occurs as per the

Honey and Mumford learning styles; the ‘Activist’ who look for challenge and immediate experience;

‘Reflector’ who are thoughtful and slow at approaching to conclusion; ‘Theorists’ who are logical

thinkers and conclude from experience; and ‘Pragmatist’ who look for and try out new ways and makes

quickly decision. The evaluation is taken out for the future improvements in the learning, training and

development after these activities have been carried out. This assessment helps to maintain a mastery of

these programs and their results and impact analysis. Jameson to get information from people involved in

the training program as students, educators, administrators, managers and customers, including obtaining

credit information so that future improvements can be made.

Jameson also focuses on being a learning organization with staff learning seen as a competitive strategy.

Employees convinced to learn and develop their skills and knowledge together through the environment

created. This ongoing learning method help Jameson renewed through organizational learning.

APPLICATION OF HRM MODEL

The two major approaches to Human Resource Management described by Purcell are Best Fit HRM and

Best Practice HRM model (1999). Out of these, the Best Fit HRM model has been applied and the human

resources practices are been implemented in line with this model. The Best Fit HRM model is applied to

Jameson considering the fact that this approach centers on how the HR practices and other functions

achieve the overall business strategy and on the connection between the HR practices and the

organizational strategy (Berghe L. & Verweire K., 2004). There is a vertical linkage between the business

strategy and the HR functions in this approach.

Best Fit HRM

The Best Fit approach assigned to when organization use HRM to their selective strategies and

accommodate to organization’s condition and environment such as workforce character and business

10 | P a g e

strategy. For example: By using the Best Fit approach, SHRM become more flexibility to response

change of organizational life cycle which is start-up, growth, maturity and renewal (Wiriadinata 2011).

The HR practices like rewarding, performance management, recruitment and selection and training and

development in Jameson will be carried out depending on the business strategy. This type of HR practices

will be aimed at fulfilling the employee standards such as skills and knowledge level required for the

development and future of a successful business. Moreover, Schuler’s strategy or employee behavior

model has been used in Jameson as a means of putting the Best Fit HRM approach.

Schuler’s Employee Behavior Model

Schuler’s Strategy is a framework that was developed from the Porte’s three generic strategies for

achieving competitive advantages that included cost leadership, differentiation and focus (Gunnigle P,

Heraty N & Morley M., 2006). Cost leadership also known as cost reduction which means that

maintaining the image as a low cost producer; Differentiation also known as product innovation which

means that the product is uncommon in some viewpoint different from the competitors and the customers

will be willing to pay premium prices for it; and Focus means that a narrow market segment is being

targeted and adopt either differentiation strategy or cost reduction. Schuler’s employee behaviour model

is a revised version based on this Porter’s model and it concedes HRM very crucial in achieving the

business strategy when these are properly coordinated. Furthermore, he identified various employee

behaviours that are essential in getting the organizations selected competitive strategy. In this model, the

three different HRM strategies recognized are accumulation, utilisation and facilitation and these are

connected to Porter’s three generic strategies. Now it means that if Jameson decides to be a cost leader

then it has to select utilisation strategy in respect of the human resource strategy, accumulation in case of

focus strategy and facilitation in case of differentiation strategy.

Merits and Demerits of Best- Fit HRM

According to Schuler and Jackson, organization will enjoy higher performance if they fit their human

resource strategy to their competitive strategy.

1. Desired Competitive Strategy (eg. Low-Cost)

2. Require Operation Cost Decrease

3. Supportive Human Resource Practices (eg. Employ Part-timer)

4. HR Outcomes (eg. Labor Cost being reduced).

11 | P a g e

Above there are some advantages of the Best Fit could help organization become more competitive as it

“meeting the business needs”. If we take an example of Wal-Mart, to sustain its position in merchandise

field, it had chosen low cost strategy. By using Best-Fit approach, supportive HR practices such as new

fresh graduates, part-timer and apply standardize training system will be applied. With these costs is

being reduced and achieve the goal (Wiriadinata 2011).

Despite that there are some disadvantages as well of Best-Fit approach. Primarily, Overlook employee

interests. This approach emphasize on competitive advantage might neglect the needs of the employee.

For example, Wal-Mart hired the employee at lower price than the market price in order to reduce the

operation cost. But this results that it become hard to hire and retain talented employee for Wal-Mart and

affect firm’s performance. Secondly, Lack of sophistication to strategy. Alternatively blindly just thinking

of firm’s competitive strategy by emphasizing Best-Fit approach, HR should think beyond its present

competitive position. For example, offer high rate of paid to their skilled and talented employee is a long

term investment to the firm instead of giving less pay because lot of money firm spend on training

program for the new employees (Wiriadinata 2011).

Conclusion

Human Resource is one of the main elements in the achievement of competitive advantage. Adopting HR

practices such as recruiting, training and motivation are very rare in the achievement of the overall

business goals (Pfeffer J. & Veiga J.F., 1999) and for this purpose a strategic HR plan has been made with

the help of a most suitable SHRM model. In conclusion, when systematically applied, the strategic HR

plan could crop improved potential for gaining its competitive advantage in the Chinese Alcohol industry

of Jameson in the next five years.

12 | P a g e

Referencing

Armstrong, M. & Hay Group. 2007. Reward management: a handbook of remuneration strategy and

practice 5th ed., London; Philadelphia: Kogan Page [Accessed November 23, 2011].

Armstrong, M. & Baron, A. (2005). Managing performance: Performance management in action.

London: Chartered Institute of Personnel and Development [Accessed November 23, 2011].

Berghe, L. & Verweire, K., 2004. Integrated performance management: a guide to strategy

implementation, London; Thousand Oaks Calif.: Sage [Accessed November 24, 2011].

Bratton, J. & Gold, J. (2003). Human Resource Management: Theory and Practice. 3rd ed. London:

Palgrave Macmillan [Accessed November 22, 2011].

Dowling, P.J., Schuler, R.S. and Welch, D., 1994. International Dimensions of HRM, 2nd ed. Belmont, CA:

Wadsworth [Accessed November 22, 2011].

Duerr, M. & Conference Board., 1986. The commercial development of new products, New York N.Y.: Conference

Board [Accessed November 24, 2011].

Foot, M. & Hook, C. (2009). Introducing Human Resource Management.5th ed. Harlow: Pearson

Education Limited [Accessed November 23, 2011].

Landy, F. & Conte, J., 2007. Work in the 21st century : an introduction to industrial and organizational

psychology 2nd ed., Malden Mass.: Blackwell [Accessed November 23, 2011].

Pfeffer, J. & Veiga, J.F., 1999. Putting people first for organizational success. Academy of Management

Executive, 13(2), 37-48 [Accessed November 24, 2011].

PRWEB, 2011. As China’s Alcohol Market Booms, Branded Spirits Ltd Is Featured at the Hong Kong

International Wine & Spirits Fair. Available at:

http://www.prweb.com/releases/beverage-sales-china/fmcg-china/prweb8945757.htm [Accessed

November 22, 2011].

13 | P a g e

Purcell, J., 1999. Best practice and best fit: chimera or cul-de sac? Human resource management journal.,

9(3), 26 [Accessed November 24, 2011].

Redman, T. & Wilkinson, A., 2006. Contemporary human resource management: text and cases 2nd ed.,

Harlow England; New York: FT/Prentice Hall [Accessed November 24, 2011].

Sandersaar, 2010. People and Organisations. Available at: http://sandersaar.blogspot.com/ [Accessed

November 24, 2011].

Shen, J. & Edwards, V., 2004. Recruitment and selection in Chinese MNEs. International Journal of Human

Resource Management, 15(4/5), 814-835 [Accessed November 24, 2011].

Schuler, R & Jackson, S. (2007) Strategic Human Resource Management (2nd Edition), Oxford:

Blackwell publishing [Accessed November 24, 2011].

Scullion, H., 1994. Staffing Policies and Strategic Control in British Multinationals. International Studies of

Management & Organization, 24(3), 86-104 [Accessed November 24, 2011].

Torrington, D., Hall, L. & Taylor, S., 2001. Human resource management 5th ed., Harlow Essex:

Financial Times/Prentice Hall [Accessed November 24, 2011].

Wang, X., Bruning, N.S. & Peng, S., 2007. Western high-performance HR practices in China: a comparison among

public-owned, private and foreign-invested enterprises. International Journal of Human Resource Management,

18(4), 684-701 [Accessed November 24, 2011].

Wiriadinata, M., 2011. “Best Practice” and the “Best Fit”. Are the approaches substitutes or complement?

Why? « Michael Wiriadinata. Available at:

http://mamikikeyu.wordpress.com/2011/07/31/%E2%80%9Cbest-practice%E2%80%9D-and-the-

%E2%80%9Cbest-fit%E2%80%9D-approaches-to-strategic-human-resource-management-are-the-

approaches-substitutes-or-complement-why/ [Accessed November 23, 2011].

14 | P a g e

Bibliography

IBEC, 2011. IBEC - Employer Services - HR best practice / Performance management. Available at:

http://www.ibec.ie/IBEC/ES.nsf/vPages/HR_best_practice~performance-management?OpenDocument

[Accessed November 24, 2011].

Saritha, P., Opportunities in China’s Alcoholic Beverage Market--CBR July-September 2011. Available

at: https://www.chinabusinessreview.com/public/1107/pingali.html [Accessed November 26, 2011].

Schuler, R., Dowling, P. & Cieri, H., 2011. An Integrative Framework of Strategic International Human

Resource Management. Available at: http://jom.sagepub.com/content/19/2/419.short [Accessed

November 24, 2011].

2011. Guidelines - Performance Management Development Scheme - Trinity College Dublin. Available

at: http://www.tcd.ie/hr/pmds/guidelines.php [Accessed November 24, 2011].

The History of Jameson Whiskey. Available at:

http://www.celticbydesign.com/index.cfm/feature/2_153/the-history-of-jameson-whiskey.cfm [Accessed

November 22, 2011].

15 | P a g e