Strategic Management: The Alignment of HR Strategies With Corporate Strategies - Dissertation Example

C.M. Group (CMG) is a leading independent contract manufacturer of high-quality die-cast collectibles including replicas of cars, trucks, buses, planes, bikes, trains, boats, and other items. Its headquarters are in Hong Kong and it currently has all its manufacturing operations in Dongguan, the PRC (Creative Master.com 2005). Since 2007, C.M. Group (CMG) has faced a high turnover rate and serious recruitment concerns, especially with engineer posts. More than 40% of newly recruited engineers left the company within two months, right after the announcement of the intended relocation of the Engineering Division from Hong Kong to China.

This move aimed to enhance operational efficiency. The mobility of staff leads to the frequent handover of projects and caused lapses (Ping 2011, personal communication). A decrease in product quality and delays in production schedules led to frequent customer complaints that the Company has never faced before. Its business reputation and future development were all affected. In 2008, CMG experienced one of the toughest in the Group’s history. The uncertainties resulting from the global financial crisis have dented demand from its customers.

As a result, revenue for the financial year 2008 dropped 13.6% to HK$379.4 million from HK$439.2 million in 2007. Revenue from Europe and North America, the two main markets of the company, declined 22.5% and 17.7% respectively in the financial year 2008 (Ming 2008).  In response to the uncertainty of the future and cutthroat competition, management considered implementing various measures to re-engineer down the organization, to reduce operating overhead, and improve manufacturing efficiency to keep up with the current and forecasted challenges of the company (Ping 2011, personal communication).

  Strategies of securing additional income streams outside the existing core businesses of the Group have been executed, which were expected to compensate part of profit loss.  As such, the company intended to continue to explore further acquisition opportunities.