You are the Director of HR at Towers Pharmaceuticals UK based in Farnborough, a subsidiary of a US parent company. Your company manufactures under licence a range of drugs developed in the United States. There are 400 employees carrying out technical (laboratory), manufacturing, sales, distribution and administrative duties. It is a highly competitive market. Towers Pharmaceuticals hasn’t been doing very well recently – a new competitor has emerged in the same field and sales have slipped.
You have only been in the job six months but you have just been head-hunted by a leading competitor based in Glasgow. However, you like Towers Pharmaceuticals and the job and don’t particularly want to move.
A new Chief Executive has been imported from the United States to turn things round. He has been reviewing the performance of all the operating functions, especially sales, but he is now looking at hr.
Your predecessor had prODuced a mission statement for HR that reads like this:
To provide quality services and support in hiring, trAIning, staff relations, compensation, benefits and safety beyond the expectations of all employees, enabling them to better serve their external customers.
You hadn’t paid much attention to this – since you joined you have been dealing personally with an acute shortage of key staff who had been poached by competitors. You have also had to cope with a number of employment issues, including an unfair dismissal case. Your HR Manager has resigned and has not yet been replaced. In general the HR function has concentrated on service delivery in recruitment, basic training, day-to-day advice on employment matters, and pay and benefits administration (there is a conventional multi-graded pay structure with performance-related pay based on performance ratings, which, however, has tended to result in almost everyone getting the same percentage increase). Only some basic recruitment activities have been outsourced and a little supervisory training.
The new Chief Executive has taken exception to the HR mission statement. As far as he is concerned it is too much about providing services and not enough about BEIng accountable for enabling business success. He has told you to redraft the mission statement and describe the key areas in which HR activities should be developed so that they make a more significant contribution to the company’s performance.
You accept that much needs to be done and you are only too well aware that your job is on the line – you have to deliver (although you have the safety net of the offer from Glasgow). But you have misgivings (kept to yourself at this stage) about the proper role of HR. Is it just there to improve business performance or has it, in Ulrich’s words, a role as ‘employee champion’? You are aware that this term may not go down well with your hard-headed Chief Executive, who is likely to respond to it by saying quite forcibly: ‘Whose side are you on anyway?’
In spite of, or perhaps because of his forthright approach, you admire the Chief Executive. You feel that he will always be prepared to listen to a reasoned argument and without talking about being ‘the employees’ champion’ (you are not certain that this is truly your role) you do believe that HR should be actively concerned about the well-being of employees and this should be reflected in the mission statement and be part of the HR strategy. You recognize that this will go down much better with the Chief Executive if you can make out a convincing business case.
1.Do you think anything is wrong with the existing mission statement? If so, what?
2.Develop arguments for and against including employee well-being in the mission statement and the HR strategy.
3. Draft a mission statement in the light of what the Chief Executive wants, the context in which the company is operating and your conclusions on the need to include employee well-being as part of the statement.
4. Set out the headings of an HR strategy, again taking into account the context, which includes employee well-being provisions, if you believe they are appropriate.
5. If you have included employee well-being, make out a business case for doing so to be presented to your Chief Executive.
Comments and further questions
In the words of Gary Kauffman in an article titled ‘How to fix HR’ in the Harvard Business Review, September 2006, page 30: ‘Statements like this [the one quoted above] are painfully short on real deliverables and accountability.’ Is this true? Should the statement, again in Kaufmann’s words, imply or state directly that: ‘HR should put responsibility for business outcomes, first and centre’? Is his contention accepted that a statement should include something to the effect that: ‘HR’s responsibility is to ensure that our human resources are more talented and motivated than our competitors’. HR’s performance will therefore be measured by comparing the company’s sales, profits and productivity with those of our top two competitors’? Kauffman also advocates the use of measurements of accomplishment that reflect business success: sales or revenue, profits, productivity, customer retention and so on. Is this approach appropriate?
Consideration can usefully be given to the extent to which these remarks should influence the contents of the mission statement.
1.Is it agreed that Ulrich’s term ‘employee champion’ perhaps raises more problems than it soLVes?
2.Is there a business case for incorporating the concept of employee well-being into an HR mission statement?