Human Resource Practices in Ikea - Case Study Example

HUMAN RESOURCE PRACTICES IN IKEA Human Resource Practices in IKEA Executive Summary This report analyses some of the HR practices such as motivation and ways in which the IKEA Company has been offering benefit packages for instance, the maternity leave and the tuition reimbursement among others. It also discusses some of the measures it has taken to assure its workers fair treatment and enhance diversity. Some of the discussed strategies include promoting women into managerial positions and creating strong teams whereby the leaders do not have titles. The conclusion gives a synopsis of the entire report, proposing that the organisation comes up with a more holistic culture that continues to support equality and ensures that the employees are given adequate salaries according to their responsibilities. Table of Contents Human Resource Practices in IKEA Introduction Various companies have come up with different human resource practices to maximise profits and guarantee a continuous competitive edge. The IKEA Company is focused on creating a better life for the society and has been at the forefront in recognising its workers and promoting equality. It believes that the workers are more committed and productive when their needs are taken care of. The firm also ensures that the employees are treated fairly and there is diversity in order to give more room for innovative ideas and guarantee equality. Motivation is also a major focus in the company with regard to enhancing productivity and the overall performance (Eriksson-Zetterquist, Mullern & Styhre 2011, pp.128-129). Therefore, this report focuses on discussing the two human resource practices, which are motivation and diversity as well as equality. HR Practices at IKEA The company has adopted an affirmative approach towards coming up with effective human resource practices. It has developed a rigorous policy and a code of conduct that aims at treating the workers fairly, making sure that the working condition is effective. It has also come up with various practices such as motivation of the employees, and equality as well as diversity, which will be discussed in length. Motivation According to the motivation theory, it is essential for every firm to have motivated workers in order to guarantee continuous profitability, ensure a competitive edge, and become successful. Research shows that motivated workers tend to work harder and remain in the organisation for a long time; thus, reducing the rate of turnover. However, it ought to be understood that motivating the workers and retaining them is not always an easy task since the firms that fail to do so, end up at a competitive disadvantage against their rivals. IKEA, which is rated as one of the best firms because of its sustainable, functional, and well designed home products is focused on motivating its workers (Barrow 2011, p.179). According to the McClelland’s theory, an individual’s motivation as well as success with regard to a particular job is influenced by the need to accomplish, the need to gain power, and affiliation. Those persons who desire to achieve more are increasingly motivated and are focused on setting goals and taking risks. Those who are focused on been affiliated are successful team players and work in supportive working environments as in the case of the IKEA workers. The firm believes in having a high performance oriented team to ensure harmony. Therefore, it has come up with an exemplary team culture that gives the employees an opportunity to discuss and choose their roles and ways they can operate successfully without being supervised. The two factor model also affirms that the management ought to motivate its workers by enhancing the content of the work and the outcomes, allowing room for promotion, personal growth, recognition, responsibility and achievement as is in the case of IKEA (Hodgetts & Hegar 2007). Similarly, the expectancy theory assumes that workers are motivated to work hard in case they believe that their efforts will lead to them being rewarded with promotions as well as bonuses. In that case, IKEA has over the years taken strategic measures to understand its workers and what does motivate them through conducting surveys. They have advanced an arrangement in which they provide intrinsic and extrinsic rewards to their employees. For instance, besides meeting their salary oriented needs, the company guarantees that there is assurance of job security for every employee. This is done by creating deep rooted sense being part or belonging in the firm. All the employees are also entitled to having remarkable benefits such as educational assistance and medical coverage. For the employees who seek to have more challenging activities, the organisation delegate complex tasks and imperative roles to their workers; thus, allowing them to appreciate their maximum potential, achieve their goals, get more experience, and improve their rate of self actualisation (Aswathappa 2005, pp. 366-368). The firm’s cohesive and friendly environment has also helped in enhancing relationships and ensuring a competitive edge. It is essential to appreciate that diverse people have diverse needs, which can be associated with Maslow’s Hierarchy theory. The theory states that employees should have their physiological, social, self-actualisation, safety, and esteem needs met to guarantee success and high rate of retention. The IKEA Company stresses on meeting such needs by having a positive and simple interaction with the workforce to get feedback on their expectations. It also gives benefits such as flexible scheduling and tuition reimbursements to employees who work for more than 20 hours. It also offers other motivational packages such as paternity as well as maternity leave, and telecommuting options among others. However, although the company is determined to motivate its employees, surveys show that some of the workers are not paid an adequate amount according to their responsibilities though most of them claim that they are satisfied, revealing that they are highly motivated (Hodgetts & Hegar 2007, pp. 47-48). Diversity and Equality According to Shore et al (2009, pp. 117-119), for an organisation to meet the needs of internationalisation, innovation, and high quality, the human resource management must come up with rational measures that recognises the need to have people with different educational backgrounds, values, experiences, and functions. This means that diversity is the cornerstone of creating a successful environment and the management should be tolerant to it to realise the aforementioned advantages. The equity theory states that the workers perceptions with regard to issues of fairness are dependent on their rate of motivation and are important. It affirms that in case the employees tend to think that the workplace is discriminatory or unfair, they become demoralised and distrust the management to meet their needs. According to the theory, the workers question on whether they are getting the same outcomes as compared to their inputs. In case they feel that their efforts are not similar to their rewards, they reduce their inputs, get into a survival mode, become resistant, reduce the other people’s outputs, and in extreme cases they quit (Tanner 2014). In that case, IKEA has realised that the best way to ensure equity without harming the employee’s rate of motivation is by employing diverse people and guaranteeing equal opportunities. The human resource management should seek ways in which they can address issues with regard to diversity and equality to improve working relationships. There should be sound avenues in which the staff members can raise and come up with ideas on how to promote equality and avoid biasness. Consequently, the employees will feel empowered and affirm that indeed they are part of the company. It is the responsibility of the human resource manager to make the workers believe that they are working with the firm and everybody is equal with a specific goal to maximise profits and not necessarily working for the management. IKEA makes sure that all workers have equal chances for career advancement and promotion. This way, it offers them better reasons to enjoy their work and be more productive. Considering that the company has a unique team culture, the team leaders do not have special titles and everyone is free to decide on what they would want to do; hence, enhancing equality. For that reason, if an employee feels tired in their area of work, they are free to attempt something fresh or move to an alternative role within the firm (Brzezinski 2013). The company’s positive HR practices and polices have been continuously supported by a solid and a nurturing culture that promotes creativity as well as diversity, making the relationship between the management and the workers open and strong. The aspect of diversity is fully actualised in the company by ensuring that all people treat each other in a respectful manner regardless of their gender, age, and ethnic affiliations. Promoting diversity also means valuing and embracing the uniqueness of all persons and treating people fairly. The firm also has a policy that aims at facilitating an environment that embraces equality among the consumers, contractors, and the employees, providing similar prospects. It also promotes gender equality with a goal of creating a humanistic and inclusive culture. Therefore, it has approximately 47% of women who are managers and 40% of them are top managers. The human resource personnel realises that there is a need for the business to be equally led by women and men to be successful. As a result, diversity has opened room for more creativity, innovation, and new perspectives. The firm recognises diverse talents and the need to have a team of both young and old in order to guarantee creativity and experience (Brzezinski 2013). Conclusion and Recommendations It is without a doubt that IKEA has prioritised on meeting the needs of its employees by motivating them. It guarantees promotions, effective working conditions, job security, and personal growth. Such factors represent the order of needs in the theory of Maslow. In that case, it is evident that the employees at the organisation are intrinsically motivated. Considering that some workers claim that they are not paid adequately for their job description, it is important for the firm to enhance their motivational level. The issue of diversity and equality is also a major issue for the company. The equity theory postulates that the employees need to feel that their inputs are worth the rewards gained. However, if they believe that their rewards differ from their efforts, they perceive the workplace as inequitable. To avoid harming the worker’s rate of morale, the firm has created a culture of fairness where women are given similar opportunities as their male counterparts. However, they will need to increase the number of women in the managerial positions to at least 50% to ensure full equality and avoid future controversy. The company should also seek to guarantee diversity in other areas such as disability and make sure that people are not discriminated on the basis of their health. This will build on its reputation and increase profitability. Finally, to ensure long term success, it should improve on its policies and aim at creating a holistic culture that motivates its workforce, ensures equality in all areas, and promotes diversity. References Aswathappa, K, Human Resource and Personnel Management, Utta Pradesh, India: Tata McGraw-Hill Education Barrow, C, 2011, the 30 Day MBA in International Business: your Fast Track Guide to Business Success, London, UK: Kogan Page Publishers. Brzezinski, N, 2013, ‘Value-Based Leadership and Empowering Women: Interview with CEO of IKEA Group,’ Huffington Post. [Online] Available at :< http://www.huffingtonpost.com/natalia-lopatniuk-brzezinski/valuesbased-leadership-em_b_4479389.html>[viewed 13 November 2014] Eriksson-Zetterquist, U., Mullern, T & Styhre, A, 2011, Organizational Theory: A Practice Based Approach, Oxford: Oxford University Press. Hodgetts, R & Hegar, K, 2007, Modern Human Relations at Work, Kentucky, KY: Cengage Learning. Shore, L., Chung-Herrera, B., Dean, M., Ehrhart, K., Jung, D., Randel, A & Singh, G, 2009, ‘Diversity in Organisations: where are we now and where are we Going,’ Human Resource Management Review, vol. 19, pp. 117-133. Tanner, R, 2014, Equity Theory-why Employee Perceptions about Fairness do Matter. [Online] Available at: [viewed 13 November 2014] Read More