Despite having successfully completed years of business in the bicycle sector, Bicycle Unlimited was faced with tough competition from cheaper products from countries like China and Japan. The quality and price of products from these countries began to threaten the market position of Bicycles Unlimited. Where the fundamental objective of the company was to maintain its market share, competition made it difficult to do so. As a result the company had to make some price adjustments in order to sustain its market share.
In such a scenario where price adjustments can lead to significant changes in the manufacturing and overhead factors, a right combination of HR strategies need to be put in place. HRM actions can greatly benefit the company by improving its effectiveness and efficiency. Since employees are critical assets of the company, it is essential that the right measures are taken to apprise them of any changes that the management plans to undertake (Lokhandwala, 2007). The more motivated the employees are the better will be the productivity of the company.
Motivated employees will be able to focus on the companys interests. Furthermore, the right mix of HRM strategies helps employees align companys interest with their personal interests. An employee who knows that an increase in the companys market position will eventually lead to the recognition of his efforts will be more willing to work in the companys interest. Moreover, HRM policies give employees a sense of relief as they are aware that they are being rewarded for their efforts and that in return of their contribution towards the firm, the management is also compensating them (Lokhandwala, 2007).
Also, in times when there is tough competition from other companies, management should take extra actions to ensure employee satisfaction as other companies may offer better job opportunities and hence the employees may join competing firms. HRM strategies focus on information sharing with employees, communicating the Me Issues (how any change will affect an individual employee) to them and helping them deal with rumors and misunderstandings. While perks and other forms of benefits are already a part of Bicycle Unlimiteds HRM policies, the above mentioned can make them more effective.
In situations where the management makes a decision such as price adjustments that will also have an impact on the employees, it is vital that the employees are taken into confidence and are informed about how the change will affect them. Significant reductions in price could mean a temporary decline in employee benefits or pay increments. Communication is essential so that employees feel a sense of ownership and belonging towards the company (Lokhandwala, 2007). Also, the management should induce a sense of competition in the employees and set short term achievable goals.
Early wins can prove to be a great motivation for employees to continue working. In this case short term goals could be increasing sales by a certain percentage in a small geographic area. Small short term goals will be easier to achieve and give the employees a sense of accomplishment. However another decision that Bicycle Unlimited has taken to participate in the competition is its focus on China. The company in order to compete with cheaper products flooding the market has decided to operate in China, resulting in a number of challenges that it will face.
In order to operate in China, the company will use a mix of home, host and third country nationals to staff the operations. This will bring with it a number of difficulties. There will be a number of critical factors that the company will have to consider in such a situation. Since the situation will be much different from if the company had operated in the US, a number of measures will be taken. First the management will have to ensure that their selection of employees for the job is right.
Since the Chinese working style and culture is much different from that of the US, Chinese employees may take time to get accustomed to the way Bicycle Unlimited operates. Furthermore, in order to ascertain a motivated workforce, the third country nationals will also have to be accommodated. Since these individuals may leave their home countries and families for this job, it will take time for them to adjust in a new culture. In such a situation the management will need to be cooperative and give them time to adapt to a new culture.
In addition to giving time to its employees to adjust, the management itself will also need time to understand the Chinese system of working. Where in the US, decision making has become highly decentralized in organizations; Chinese employees are accustomed to centralized decision making (Wang, 2008). Hence the management will have to take this into consideration and allow the employees to undergo training programs that will help them take responsibility on an individual level.
Therefore the HRM strategy in China will not completely focus on decentralized decision making, rather a mix of centralized and decentralized decision making to accommodate the needs of both the employees and the organization. Another important factor that the management needs to consider is the existence of a paradoxical environment in China (Wang, 2008). On one hand organizational changes are occurring and being accepted whereas on the other hand any such change is being resisted. Hence Bicycles Unlimited will be faced with a challenge in terms of hiring employees who belong to either of the group.
Where in the US, the emphasis is on individualism, in China, collectivism is emphasized. Consequently the companys HRM strategies will be designed in a way that they allow the collective participation of employees in the companys operations. Moreover, the organizational culture in China is characterized by altruistic motivation and commitment towards duty as opposed to the American culture where stress is on responsibility based on rationale (Wang, 2008). Hence the HRM strategies in China will incorporate the Chinese value system as this forms the basis of their organizational culture.
The Chinese organizational system attaches great importance to leadership (Wang, 2008). Therefore the management of Bicycles Unlimited will not only be required to learn them self but also teach the other members of organization. Knowledge sharing as a result is an essential fundamental of leadership in China. Hence for Bicycles Unlimited to compete with other manufacturers, human resources can play a pivotal role. If the right HRM strategies are devised and implemented and the workforce is motivated to work in this changing environment, it will continue to remain the dominant player in the field of Bicycles. References
Wang, Jia. (2008). Leveraging Chinese Culture for Effective Organizational Leadership: The China Case. (ERIC Document Reproduction Service No. ED501639). Retrieved from http://www. eric. ed. gov/ (http://www. eric. ed. gov/ERICDocs/data/ericdocs2sql/content_storage_01/0000019b/80/3d/e7/77. pdf) Lokhandwala, Shafiq. (2007). Managing People, Process & Strategy for Increased Profitability: How Human Resource Departments Can Leverage Technology to Become a Strategic Profit Center. Retrieved from http://www. nuviewinc. com/resources/articles/Managing%20People,process%20and%20strategy%20for%20increased%20profitability. pdf