Human Resource issues at Amazon - Coursework Example

Human Resource issues at Amazon Introduction Human resource is one of the most important resources for an organisation and if this resource is managed effectively then it can turn into a great asset for the company. In the present essay the focus is on selecting a human resource problem in a particular organisation that is having an adverse effect on the effectiveness of the organisation. The human resource problem that is chosen for this task is labour issues at Amazon. The labour issues and human resources issues at Amazon are analysed from the perspective of theory and recommendation and action plan for improving upon the situation is also provided. H. R.M. problem having adverse effect on organisations effectiveness The company that is chosen for this task is Amazon. The company has recently become the most valuable retailer in the United States and has surpassed Walmart. The current market valuation of the retailer is at $250 billion and Mr. Bezos who is at the head of the retailer is deemed by Forbes as the 5th wealthiest person on earth (Kantor and Streitfeld, 2015). Whereas Amazon continues to grow at an amazing pace and is regarded highly by the customers of the company, there are several problems that are being faced by the company at this moment especially in the arena of human resource. One of the most serious issues that are being faced by the company is the way it treats the labour and white collar employees at its workplace. One of the key institutions inside Amazon that helps it to fulfil its tasks successfully is its warehouses. The Warehouses are the buildings where the company places all its goods and it is the place from where tons of goods are delivered to the millions of customers across the country. One such warehouse of the company is located at Breinigsville, Pa. It is important to note that most of the warehouses of the company are located in areas where the employment rates are phenomenally low (Young, 2013). Within the warehouses the houses a mix of 1600 full time part time and temporary workers. Most of the temporary workers are hired by the company before the holiday season and fired after that period. The task designed to most of the labours inside the warehouse is to pack boxes. The warehouse is located over an area of 600,000 square foot. Inside these warehouses the workers are required to pack boxes at the rate of 240-250 boxes per hour if the size of the shipment is large and up to 500 boxes per hour is the size of the shipment is small (Young, 2013). In comparison to other companies in the same industry this rate is excessively high. Amazon as it is found sets the rates higher than can be performed by the employees. It is expected even by Amazon that people won’t be able to attain the high productivity rates for which there are paid between $9 and $14 an hour. The workers in the warehouses are expected to work for 10 hours a day for four days in a week. In the holiday season when the shopping spree of the customers increases Amazon recruits temporary workers who have to work for 11 hours per day for four days in a week along with the regular staffs. The overtime in the holiday period is mandatory for the workers. The workers are given a 30 minute lunch break for which they are not paid. In addition they are given two paid breaks each of the duration of 15 minutes (Young, 2013). During the break every minute is counted and the workers have to take a break at the ring of the bell and have to be back at their work at the ring of another bell. It takes 3 minutes for the workers to travel from the work area to the break room and 3 minutes to travel from break room to work area. Thus in a 15 minute break the break that the worker actually gets for resting is 9 minutes. The items are stored in miles of racks inside Amazon and there are several floors in a warehouse or fulfilment centre of Amazon. The items that the workers have to pick up are indicated to them by a computerised device which also has a counter attached with it. The worker has barely few seconds before he has to pick up a particular item from miles of shelves and thousands of product that are stored in a warehouse. In a typical shift the worker has to typically travel minimum 6-7 miles. An article cited the fact that inside one of the warehouses in Breinigsville, Pa the workers were forced to work in temperatures as high as 110 degree Celsius (Soper, 2015). It led to the fact that a number of workers got ill and had to be rushed into local hospitals. A subsequent lawsuit was filed against Amazon by one of the physicians attending to the plight of the workers which led Amazon to install cooling systems at its warehouses at the cost of $52 million. However, the worker has no other option but to work in these shifts that result in physical and mental illness. The reason behind this is the widespread unemployment in the areas where the warehouses are located and the greater pay rate offered by Amazon. Critically examine the current situation and its root causes with reference to theory The strategy that is followed by Amazon can be termed as management by stress. The logic behind setting the levels of productivity at impractical levels is to keep the workers under constant stress that they are not being able to keep up on the requirements of the job and will thus push harder for achieving the impractical levels (Head, 2003). The theory of management by stress is one in which the employees are deliberately made to work at margin of inefficiency. This is done so that the supervisors can act on them and can tell them to work faster or lose their employment. The fulfilment of this theory is evident in Amazon where even the managers know that under best conditions the worker can only pick up 210 packages in an hour. However, the rate is kept at 250 an hour so that workers work extra hard for finding the things. This acts so as to keep the workers always on the edge of seat and never allows them to relax or settle down. Amazon does not follow the traditional management style and follows the management style that sets it apart for the industry. Not only Amazon is more demanding for the workers in its warehouses but it is so even for the white collar workers. When new employees come to join Amazon they are told to forget poor habits learned by them in their previous workplace. The employees are encouraged to tear down upon each other’s ideas in the meetings; they are required to toil long and late and are judged according to standards that are set at unreasonably high rates. These practices result in the fact that most of the employees either leave or are fired in annual culling of the staffs. Many of the popular management theories that are at least said to be followed by other companies orally are thrown out of the window by Amazon. In order to be the best Amazonians that they can become, the new comers are guided through 14 rules of leadership principles (Amazon, 2015). The 14 rules are written on handy cards which are laminated. According to the view advocated by the experts any worker who is involved in a profession that involves heavy physical work then than night employee should not work for more than 8 hours in a shift (smtm: Entertainment. 2013). However, in case of Amazon it is found that the company breaches this policy which can put the company in face of lawsuits. However, the company on its part denies such allegations and says that the working conditions in the company are designed after consultation with legal experts and that the company does not violate any legal code. The practice at Amazon is against the conventional management wisdom and conventional theories of human resource. One such theory known as the equity theory of motivation states that employees always compare the amount of input they are giving to a job top the amount of output that they are getting as result as compared to a similar employee in a different but comparable position (Koontz, 2010). If these are left unaddressed then it can have an impact on the morale of the employees and thereby have an impact on the productivity of the organisation (Pride, Hughes and Kapoor, 2013). However, this does not seem to be the case of Amazon. In case of the company most of the workers work away from the limelight. The workers do not face the customers of the company. The customers only see the website of the company and are only worried about if they are getting their materials in time or not. The fact that the customers do not interact with the employees of the company means that they are not aware of the conditions in which the employees have to work. So, unlike the case of Wall-mart which is regularly attacked by people for its bad working conditions for the lower paid employees, Amazon is seldom under fire. Amazon has its own means to measure and keep track of productivity, and enough people who are ready to replace those who fall behind the high standards set by the company. Effect of organisational change, corporate culture and conflict on hr problem Amazon has designed something which according to many is an intricate machine that propels and pushes the employees to achieve the ever expanding ambitions of founder and head Jeff Bezos. Amazon is a company that strives to do things which are really big, ground breaking and innovative things and it is not easy to achieve those things. The nature of the work that is involved for the employees when the company is really aiming the moon is challenging to say the least. Some employees can not adjust themselves to such work conditions but Amazon does not care. It is seen that an experiment is being conducted by Amazon as a company on how far it can push the employees of the company so as to achieve the ambitions of Mr. Bezos. Amazon has a system through which it is able to extract from its employees the most it can and this system is helping the company to become stronger than ever. Through its warehouses and thousands of workers the company is calling a bet with terms that it can sell anything to anyone. The way Amazon functions is singular and is different from the traditional way in which the companies worked previously. However the company is not that peculiar if one looks at the current global scenario. The only fact which differentiates the company from other companies is the fact that the company has been really quick to respond to a changing work environment (Diamond, 2012). The workplace in the global context is increasingly becoming data driven; data which allows to measure individual performances on a continuous basis. The job security which has long been in question in the Amazon has also become questionable in today’s business world with relationship of “come and go” in between employee and employers (Lundby and Jolton, 2010). These changes are being forced by global competitive landscape in which empires seem to rise and fall overnight. Amazon can be seen as a future image of where technology is leading workplace to. It is place that is more nimble and productive at the same time, but it is also a place that is harsher and is less forgiving. Amazon’s aim to stay ahead of the competition is pushing the boundaries of what is acceptable at the workplace. The company is trying to achieve something that is beyond human possibilities and in doing so is pushing humans to the limits (Saunders, 2001). It is the symbolic of a workplace that is far more demanding from the employees and which is pushing the employees to the limits of their physical and mental capacity. The company is the epitome of the practice of management by stress. It is a common picture to find employees breaking down under stress and weeping at the corner of the office under mental stress. However, these scenes although common in an Amazon office are unlikely to have an effect on the way in which the company treats its employees. The company says that it is proud to have a workplace that boasts safety and positivity. New comers at the company are passed though an orientation program that puts them into Amazon’s way of doing business that is different from the convention followed by the industry. The new comers are quizzed later on the 14 leadership rules and those amongst them with scores that are perfect can earn a virtual award which proclaims the phrase “I’m Peculiar.” The company prides itself in the phrase “I’m Peculiar.” and the fact that it is different from other companies in the business. The company and the employment management terms that are followed by the company are different from the norms followed by the industry. However, the company takes pride in its practices and many feel that these practices are responsible for the phenomenal rise of the company and the fact that the company has become the most valuable retailer. Critically evaluation of how effectively HR issues are managed to date Amazon is one of the most valued companies in contemporary business environment and it is renowned for its customer centric approach all over the world. But like any other organisation it also has certain human resource management issues, some of which have been discussed earlier. Amazon’s strength is in the fact that its work culture is very positive. The workers at Amazon are encouraged to brainstorm new and innovative ideas in the meeting rooms, toil long and late emails (sometimes late in midnight), text messages, and so on. The company also encourages feedbacks of superior managers from subordinates in a peculiar manner. The interior phone directory of the company also guides workers on how to send feedbacks about their bosses secretly without their bosses’ knowledge. Some workers in past have been found to exploit these opportunities. As the company plans to add more customers in their list it has to manage internal HR issues that are prevalent. Every company appreciates top performers who drive business to new level of excellence. Such performers are generally classified as ‘A’ grade employees who are capable of taking responsibilities and show desired output to the senior level management. The management also reverts back their contribution to them by rewarding then with attractive incentives that are beyond their expectations. This is one of the strategies followed by Amazon to retain their best talents (Branham, 2005). The competition among employees in Amazon is very high standard and losers quit their job or get fired. The human resource policies of the company is often criticised by its employees. Some of the ex-workers of Amazon who suffered from miscarriages, cancer or other personal crisis have said that their performance evaluation criteria did not consider their personal problems which are evident in one’s life. In short some of the internal workers of Amazon felt that they have been treated unfairly and not had been given more time or a chance to improve personal matters. Since its inception in the year 1994, Amazon has never been a victim of labour-abuse allegations until very recently when the company faced multiple lawsuits including the one filed by Heimbach in Pennsylvania. The lawsuits are not insignificant as when one consolidates the complaints into a nationwide class lawsuit action then it will be revealed that workers of the company claims that Amazon has failed to compensate hourly workers. The lawsuits filed by Amazon employees contend that while workers get a stringently restricted to only a 30 minute paid lunch break. They said that a lot of that time can be engaged in walking from one end of the storehouse to the other. The suits also allege that the concern is so drastically fastidious with employees’ time. It requires workers to count the start time and end time of their two waged 15-minute breaks in one shift from their job stations. In other words it means that if it takes 5 minutes to reach the lunch room from work station after the lunch break bell rings then the worker will only have 10 minutes spare to lunch till the next bell rings! Such strict guidelines are criticised by the hourly workers of the company. Amazon needs to manage these internal HR issues otherwise it could face classic actions. The Heimbach vs. Amazon suit will cost the company $50,000 for compensation to disgruntled employees of its warehouse (Young, 2013). In order to tackle these human resource issues effectively as on date, the company follows ‘Management by Stress’ policy. The principle for using this HR strategy is to allow minority of workers to work faster especially the ones that operate at the margin of inefficiency (Clutterbuck, 2007). The senor level management believes that strict working conditions at work place are absolute necessity for discipline and dedication. If any slack is given then the company will not be able to achieve its corporate objectives. However, Amazon’s spokesperson has denied the allegation by Heimbach that states that the company sets unachievable targets. The floor manager of Amazon in California on the other hand admitted that goals set by senior management were higher than expectation levels but not completely unachievable (Young, 2013). The company now hires workers directly by interviewing each candidate by internal recruiters. This ensures better performance for the same duties and greater worker satisfaction. Recommendations for the resolution and improvement of the problem issue As discussed in the previous sections, Amazon is presently facing human resource issues related to workers’ dissatisfaction about company’s work policies. But, worker satisfaction is indispensable tool for success of any company. A soaring rate of worker contentedness is directly linked to a lesser attrition rate. Thus, it can be said that by keeping the workers contented with their careers, Amazon should be able to manage its HR related problems effectively and become a priority for every employer. There are several reasons why the workforce of Amazon can become disheartened with their jobs and leave. Some of reasons include lack of communication, high stress, or absence of direct communication of lower level workers with senior managers within the company, lack of appreciation or recognition, and limited prospect for growth in certain segments. The management of Amazon should proactively seek out to improve these factors if they expect to lessen their attrition rate and minimise worker dissatisfaction (Kaye and Jordan-Evans, 1999). Studies have found that stress is one of the foremost causes of workers’ discontentment with their job. From the above discussion it seems clear that one section of all workers feeling some level of dissatisfaction due to stress. This is unquestionably creating a negative impact on the company’s productivity, not to mention invite unintended lawsuits. It also reduces the probability that these will continue to be a part of the Amazon family in the long term (Branham, 2005). The management of Amazon will have to quick in resolving these HR issues otherwise other employees will be motivated to follow the footsteps of rebellions. It is known that stress can be an important tool essential to productivity or work efficiency. The company has set high target thresholds for the workers and created higher stress levels because it expects workers to perform at certain rates and contribute their best at workplace. Yet it has been found they are unable to do so. No company could tolerate their workers spending hours just looming around the warehouse chatting, eating, and not working. The world of 21st century is very competitive and such lenient actions will not help the company to achieve corporate goals and objectives. A balance will have to be created so that it results in higher productivity and higher turnover. Perceptive that the management of Amazon is able to provide essential work-life balance for the workers’ position is crucial to building healthy and trusting relationship between the employer and the employee (Gaurav, 2013). When any company expects their workers to perform beyond standard work hours it generally detracts workers’ relaxation time (as seen in case of Amazon discussed earlier). Personal time is vital in upholding good relationships, along with sanity and personal wellbeing. The additional strain of requiring finishing the task at hand or an unreasonable amount of work dramatically increases worker’s anxiety for keeping the job. Amazon must be emphatic towards its workforce and understand that in today’s competitive environment where the economy is already facing slowdown, no employee would want to be fired at will. Hence, employees struggle hard to finish their tasks and satisfy the management so that at the end of the day they are not handed over the ‘pink slip’. In economic downturn they become less likely to begin the search or even get a new job elsewhere. It is important that Amazon care about the contentment of their employees. Recent statistics also show that throughout the careers of American workers, they hold a standard of 8 jobs which is quiet interesting (Rudman, 2003). The rate of employee turnover because of job satisfaction is rising at an alarming rate. This is also creating a financial burden for the employers as well and even in the period of economic downturn, the employers had to spend a lot of money recruiting new employees, continuously repeating the hiring process, and ultimately end up training new workers who again leave the company after few years. Worker dissatisfaction has many harmful side effects for the company one of which is definitely the bottom-line. In short it can be said that worker satisfaction results in a much better retention rate and stable productivity. A feasible action plan considering the acceptability of the proposals to the key stakeholders  External environment and high competition in the market are changing the way companies manage their human resource. In global market, a ’one-size-fits-all’ approach to manage human resource is ineffective in contemporary business environment. This is the reason why now a day many surveys measuring worker engagement have become increasingly common. The most important corporations are now regularly using surveys, feedbacks and social media to manage their workforces (Koslowsky and Krausz, 2002). These surveys and their reports have the potential to yield useful details about employee behaviour and attitudes. However, in many cases the data have been misunderstood or misinterpreted that resulted in waste of time, resources and money. Also, Amazon will have to consider that attaining milestones is not the principal determinant of the success. Successful business management also involves ensuring workers’ ability to adapt to and work efficiently and economically in the contemporary environment. A feasible action plan that considers the acceptability of the proposals to the key stakeholders is discussed as follows: 1. Planning – Proper human resource planning is imperative to worker satisfaction and productive operations. For decades it has been debated by scholars and managers of whether or not monetary incentives motivate employee behaviour and long-term commitment towards organisation. Many authors have concluded that monetary resources do not motivate a worker to remain committed or drive performance. In fact, some scholars also believe that money could even become a dissatisfying factor. In contrary some studies also show that when considerable amounts of money are at stake then it clearly ties to individual employee behaviours. While planning, recruiting, creating work-time policies, and other rules and regulations, Amazon should remember that a happy worker will be more productive than the unsatisfied ones. This fact is also appreciated by multinational corporate such as Google. The company provides all necessities to their workforce that will help them feel like they are not at workplace but at a homely atmosphere (Andrews, Cameron and Margaret, 2008). 2. Defined governance – There are large dissimilarity in what individuals value. In order to understand how to inspire somebody to be accountable, it is vital to know what the individual values. The company must define the roles and responsibilities of workers and set realistic targets so that the employees do not complain about management policies. While setting management policies Amazon should also properly link tasks with suitable rewards. A feedback system should be implemented that will help the management to continuously determine what more can be done to create a healthy work environment (Heathfield, 2009). 3. Committed leadership – The management will have to be proactive and undertake good leadership initiatives. The leaders are the role models who inspire the workforce to follow their footsteps. Committed leadership will make sure that the workers are not dissatisfied with present work conditions. One of the most challenging tasks of the leaders in today’s world is motivating workers. Worker motivation is best influenced, understood and predicted by considering the expectations that individuals have. This is one of the reasons many corporate are telling managers to be more emphatic and training workers to develop their emotional quotient. Simply stated, workers generally keep the behaviour that they anticipate will lead to rewarding career which they value. Thus, it is vital to understand the point of view of the workforces’ expectations. If the workforce of Amazon has unrealistic expectations from the management then they should be properly communicated and re-aligned in such a manner that will contribute to attainment of organisational objectives and not individual gains. 4. Informed stakeholders – The various stakeholders should be encouraged to participate and commit themselves in creating a great working environment. An open and consultative communication should be approached instead of threatening either party for lawsuits. The management should strive to bring awareness among the workforce regarding teamwork and mutual benefits. 5. Aligned workforce – It should be noted that alignment of workforce involves cost to company. There are arrays of outcomes that may be attached to employee behaviours. Optimum performance might lead to outflow of more money, high job security, feelings of accomplishment, and a mass of other optimistic outcomes that can cause workers to perform at their best. From an organisational point of view, Amazon will have to understand what the workers perceive as the consequences of diverse kinds behaviours. This will help to produce a good alignment between what the workers expect to be rewarded for and what actually the organisation needs (Branson, 2008). Conclusion This study focused on selecting a human resource issue in Amazon that is having adverse effects on the productivity and effectiveness of the organisation. The employer (that is, Amazon) has a responsibility to make sure that the satisfaction level of its entire workforce is adequate. There are many safety measures that managers can undertake to make sure that they are adhering to the working needs of their workers. The recruitment team should be more careful during the hiring process. Having numerous candidate interviewed to get the final candidates will ensure that the worker will work well and retain with the company. Reference Amazon. 2015. Our leadership principles. [Online]. Available at < http://www.amazon.jobs/principles > [Accessed 15 November 2015]. Andrews, J., Cameron, H., and Margaret, H., 2008. All change? Managers’ experience of organisational change in theory and practice. Journal of Organisational Change Management, Volume: 21 Issue: 3. Branham, L., 2005. 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