Human Resources in U-Soft - Case Study Example

Analysis of Human Resources in U-Soft MGMT 444 Operation Management Mark Morpurgo Executive Summary U-Soft is a successful software company that supports the specific needs of online gaming. Despite the success of U-Soft in software industry, the company is not performing at its best performance. Since most of U-Soft employees are not motivated to work at the best performance, the company failed to maximize the use of its available human resources. Among the factors that makes U-Soft de-motivate at work includes the fact that the company’s work environment conducive for software designing and development purposes. Likewise, the company’s recruitment policies compensation packages is not aligned with the specific needs of the software designers. Other factors that make U-Soft employees work below their capabilities includes poor leadership skills among the managers and lack of work promotion opportunities. To increase the work performance of employees, HR manager of U-Soft should draft new HR policies, remuneration packages, and work flexibility options. This strategies are effective in terms of motivating employees to improve their overall work performance. Likewise, HR manager should also connect with colleges and universities to enable the company hire some of the most competitive young individuals who are highly skilled with software development and design. Table of Contents Executive Summary ………………………………………………………….. i Table of Contents …………………………………………………………….. ii I. Introduction …………………………………………………………… 1 II. U-Soft’s Background …………………………………………………. 1 III. Performance Gap ……………………………………………………… 3 IV. SWOT Analysis ………………………………………………………. 5 V. Operational Management Improvements for U-Soft Employees ……. 9 VI. Recommendations ……………………………………………………. 11 VII. Conclusion …………………………………………………………… 13 Work Cited ………………………………………………………………….... 15 Introduction U-Soft is a software production company that also operates in online gaming. Being a service oriented firm with technical requirements, it is of utmost importance to U-Soft that it recruits skilled and technically equipped people to deliver efficiency and optimal output. Theoretically, reduced HR costs get reflected in decreased production costs and enhanced profit margins. However, U-Soft is facing problems in managing its workforce due to increased competition, quality emphasis and performance gap between actual and expected. This paper delves deep into analyzing the competitive strategies of U-Soft and how its human resources policies are not supplementing its business policy. Starting with a brief overview of the company, SWOT analysis and identifying the current gaps in the recruitment and working environment form the basis for recommending solutions to problems caused by insufficient and ineffective management of its workforce. U-Soft’s Background U-Soft is a technology driven organization which was founded in 2003. Eventually, U-Soft became a public company in 2007. The company operates in Business Intelligence, Consulting, Alert Engine Tools and online games with services provided to both business enterprises and customers. Aside from the use of the best technology through the efforts of its workforce, U-Soft’s core competency revolves around its independent intellectual property and patent rights and its ability to hire competent employees. U-Soft is gaining prominence in international market in developing quality and technically rich interfaces and business intelligence solutions which is attributed to the expertise and culturally diversified management of its workforce. Its biggest strength in capturing recognition and acclamation worldwide is its enterprise management and endeavor to create a friendly and flexible working environment. Because of its expertise in software development, one of the prime advantages of U-Soft in software industry is its ability to imitate some features of existing software technology. Even if U-Soft does not invent any unique or new technological marvel, it can always imitate the work done by competitors at reasonable prices since the law prohibits the creation of a monopolistic market within the software industry. Recognizable features of human resources management at U-Soft comprises of following major points that account for its success as well as some of the probable loopholes: The company boasts of efficient and relative reward system, enabling employees to grow to their full potential. Effective team work with clearly set goals and objectives. Two-way communication channel between top management and employees with elimination of noise and distortions. Effective leadership where team work is appreciated and people are encouraged to assume supportive roles. Ad-Hoc Management that focuses on individual goals and accomplishments, giving complete justice to the cause. The operations management at the software company its operations are dependent upon the creativity and ingenuity of its staff and workforce. Despite the success factors that contributes to the success of U-Soft, performance gap at U-Soft is caused by its HR manager’s failure to promote the importance of good leadership skills among the managers and align U-Soft’s recruitment policies, working environment and compensation grade system with the specific needs of the software designers. Employees’ lack of motivation at work leads to the increase in the number of absenteeism and high employee turnover rate. Absenteeism and high employee turnover rate contributes to the decrease in the operational performance of the company as a whole. If U-Soft wants to increase its efficiency, productivity and quality proposition, it has to look after its employment policies and workforce management techniques as majority of performance gaps are being created by human resource problems. Performance Gap As per U-Soft’s human resource management policies, it seeks to offer a conducive and friendly working environment where employees are presented with opportunities to develop. Performance gap is actually a measure to determine the difference and the area in which the difference arises between actual and expected. This gives the opportunity to modify the processes and activities that might be faulty. Performance gap is an effective tool to determine how the policies and plans have fared in reality and whether the benchmarks have been complied with. As per U-Soft’s human resource management policies, it seeks to offer a conducive and friendly working environment where employees are presented with opportunities to develop. In line with this, identifying the performance gap is useful in terms of enabling the HR manager to effectively increase employees’ and overall operational performance. Performance gap at U-Soft is caused by its HR manager’s failure to promote the importance of good leadership skills among the managers and align U-Soft’s recruitment policies, working environment and compensation grade system with the specific needs of the software designers. To prevent high employee turnover rate, recruitment policies should be aligned with the specific needs of competitive software designers. At least, packages and benefits offered to them should be equal or even more than what U-Soft competitors are offering. In general, competitive software developers and designers are among the most important resources in expanding the production of online gaming software. Aside from the fact that the culture of favoritism is strong at U-Soft, the salary structure is way below the industry standards. Since the levels of compensation and remuneration are not fixed with the job description, a lot of U-Soft employees feel unhappy and failed to perform their best at work. Given that most of U-Soft employees are not motivated with their current job, aligning the U-Soft’s recruitment policies with the demands of its employees and improving the company’s compensation grade system will narrow down the chances wherein existing U-Soft employees would perform below their maximum work potential or even consider leave U-Soft to work for other companies. The problem with U-Soft existing work environment is related to excessive noise pollution. In line with this, software development requires deep concentration and team work. To enable employees concentrate with their work, HR manager should provide employees with a quiet working environment to ensure that the software quality produced would be within the expected outcome. Basically, addressing the performance gap at U-Soft is necessary to improve employees’ motivation. In the long run, solving problems related to performance gap could enable the company avoid a sudden increase in the number of absenteeism and high employee turnover rate. If U-soft fixes the recruitment and selection along with human resources management costs, keeping in mind the actual and expected performance, the differences would come up as follows: Items Current Current Cost/month After changed Difference Advertising one time per month 2,000 2,000 - Selection one staff and department manager 5,000 4,000 1,000 Interview one staff, department manager and HR manager 10,000 10,000 - Training 10 days per month   10 Developers and designers salary 50,000 40,000 10,000   Trainer salary 7,000 3,500 3,500 Waste working time 1 hours every day, 100 staff 80,000 40,000 40,000 Travel HR recruitment in university - 6,000 (6,000) Working Place  innovation - 2,000 (2,000) Administration  support - 5,000 (5,000) Total Expenses  Per month 154,000 112,500 41,500 Thus, it is evident that U-Soft can achieve much of cost cutting and savings if it rationalizes its human resource policy and makes some changes in its recruitment and selection policies. The focus should be on retaining qualified and experienced employees that contribute to the organizational development. If efficient people are kept right from the beginning, there will be lesser time invested in their induction, getting them adapted to the new working culture and letting them understand the importance of recent technology development. SWOT Analysis SWOT analysis is a strategic tool to assess the internal and external HR strategies of U-Soft which could either directly or indirectly affect the operational performance of the company. With this, the opportunities and threats will enable the HR manager determine the factors that will contribute to future improvements of the long-term operational performance of U-Soft. Thus, it is essential to know how well the company fares in response to changing work conditions. Strengths Weaknesses Hires technically competent and sound professionals. HR manager managed to establish diversified workforce. Strengthened two-way communication channel between top management and employees. Promote effective team work. Failure to align its HR policies with the organizational culture and practices. Insufficient skilled employees in creating and designing technical interface. Lack of good leadership skills among the managers. Insufficient salary and monetary incentives. Lack of promotional opportunities. Opportunities Threats Align U-Soft’s recruitment policies, working environment and compensation grade system with the specific needs of the software designers. Promote the importance of good leadership skills among the managers Increasing number of absenteeism due to lack of motivational strategies. High employees’ turnover rate caused by low salary and inadequate monetary incentives. One of the strength of U-Soft’s HR strategies is that the HR manager is focused on hiring technically competent professionals who are capable of producing unique software use for online gaming. Basically, the genuine technical expertise of U-Soft existing employees gives the company an edge over its rivals. As a result, this strategy contributes to the operational efficiency of the company not only in terms of the increasing the quality of U-Soft’s software but also minimizes the risk of organizational conflict due to miscommunication with regards to the software specs and operational deadlines. Since the HR manager was able to establish a group of diverse workforce, U-Soft is able to meet the different demands of its existing customers. In line with this, the presence of a diversified workforce provides the company with multiple solutions and ideas to software development issues and other related customers’ concerns. This enables the company to address the cultural differences of its customers and co-workers. As a way of producing original technology, U-Soft established a partnership with Microsoft. In line with this, accreditation with Microsoft gives the company a higher qualification which creates a niche for U-Soft despite the increasing demands within the technological market of software products (About U-Soft). In this context, strengthening the practice of two-way communication line between the top management and its employees can be considered as one of the best HR attributes of U-Soft since a two-way communication among the company’s shareholders strengthens employees’ commitment in terms of enhancing the overall operational flow when designing and developing software. Through the use of two-way communication line and promotion of effective team work, it is easier on the part of the HR manager to avoid and resolve organizational conflicts which may take place along the way. Part of the company’s weakness is due to the HR manager’s failure to align the company’s HR policies with the organizational culture and practices. Even though the company was able to hire technically competent and sound professionals, the fact that the company’s existing employees are not committed nor motivated at work results to insufficient skilled employees which are needed in the creation and designing of technical interface. This particular HR problem is causing the company to experience lack of sufficient skilled manpower to create and design high quality apt technical interface. Because of lack of sufficient manpower, the company often misses the original deadlines wherein the company had to introduce new software in the market. Among the common strategic factors that could increase employees’ motivation includes the practice of good leadership skill, competitive salary and monetary incentives, and promotional opportunities. Since U-Soft’s HR manager does not provide its employees with competitive salary and monetary incentives, and promotional opportunities, its existing employees are working below their average performance level. Having a group of de-motivated employees could harm the operational performance of U-Soft. As per market trends and demand for online games and software production, it is forecasted to see an upsurge in the coming 20 years. Moreover, there is dire and requisite need to upgrade the existing software every year. For this reason, U-Soft should enhance its operational productivity and secure the loyalty of its customers by improving its servicing. All this can be done by aligning U-Soft’s recruitment policies, working environment and compensation grade system with the specific needs of the software designers. In software industry, time constraints are not considered feasible because developers and designers would not like to work in limited hours. Therefore, aligning U-Soft’s recruitment policies with the specific needs of the software designers would likely increase the chances that the company will be able to hire competitive employees and enable them to remain loyal with the company. Improving the work environment such as minimizing the noise pollution within the work area could also increase the concentration of each employee at work. Entering into a business partnership with Microsoft or other big software giant does not ensure the operational success of U-Soft unless the company has efficient and skilled manpower in place. With regards to the necessary improvements in the compensation grade system of U-Soft, its employees would become more committed since employees will not have to find other ways to search for alternative sources of additional income to support the financial needs of their family members. Likewise, this strategy is effective in terms of making employees satisfied with their current job. On top of aligning the U-Soft’s recruitment policies, working environment and compensation grade system with the specific needs of the software designers, the HR manager should also promote the importance of good leadership skills among the managers. This can be done by providing U-Soft’s managers with adequate in-house trainings to ensure that each manager would become aware of the type of leadership style they use when dealing with U-Soft’s employees. Doing so will contribute to the increase in work motivation of the workers. Operational Management Improvements for U-Soft Employees Between specialization and automation, the HR manager of U-Soft should choose automation when designing job in order to avoid repetitive, monotonous, and boring job which could make employees less motivated at work (Monks, pp. 176 – 177). To enhance the operations of U-Soft, HR manager should maximize the use of its available human resources by integrating necessary trainings in the jobs design. This strategy will increase U-Soft’s employees’ ability to come up with new ideas on how to develop and design more competitive software which could provide the company with competitive edge in the software industry. The main objective of HR department is to manage employees and design jobs that can make its employees effective in terms of their work performance (Heizer, p. 384). By creating organizational culture that accepts organizational learning; U-Soft will be able to improve the existing knowledge and skills of its workforce. Considering that U-Soft is a software company that directly provides services to its customers, its employees should undergo special trainings not only on the proper way of interacting with its customers and suplliers but also on possible improvements in the designing of software. There are many factors that could hinder the promotion of an effective learning organization. Among the major factors that could negatively affect the promotion of learning organization include: (1) an organizational culture that is not aligned with employee education (Weick and Westley, pp. 440 – 458); (2) lack of open communication or good relationship between the leaders and subordinates within the business organization (Cowan); and (3) the lack of strong management support on employee development (Jackson). Since the promotion of a learning organization could increase engagement between the company and employees, developing a culture that promotes organizational learning is the best solution to increase employees’ work commitment and loyalty. As part of promoting employee engagement through employee education, U-Soft should invest time and money not only focusing on the designing of effective curricula but also in terms of assigning some of its senior organizational leaders to head the execution of the training program. In the process of going through employee education programs, U-Soft managers will able to hand down their personal experiences to the rest of the team members. This strategy is also useful in establishing open communication between U-Soft managers and the team members. As a result of team building, conflicts and operational errors which may arise from miscommunication will significantly decrease. A two-way communication line between U-Soft managers and the team members could strengthen the organization’s commitment towards reaching the organizational goal of empowering employees through proper trainings and development (Pitta and Franzak; Cowan). In the process of strengthening organizational learning, each members of the group could work as a team in order to resolve or avoid unnecessary conflicts that could hinder the growth of employee development. Implementing an effective social network within U-Soft allows proper communication line among the stakeholders of the company. In line with this, it becomes easier for each employee to align their vision towards a single organizational goal. It also enables the group leaders to establish a unique culture that shares both the internal and external knowledge of each organizational member that is necessary in strengthening the soft-skills of the work team (Krebs). Recommendations Looking at various aspects of U-Soft’s human resource policies, its mission, vision and objectives and respective shortcomings in the management of human resource, it becomes obvious that the company needs to take some concrete steps in the immediate course of action to weed out the competition and sustain itself in the market. Recruitment is the first step to secure a group of efficient and qualified candidates to the organization. Since U-Soft operates in the technological domain, it is important for the company to be able to find good and talented candidates that specializes in technology. To improve U-Soft’s recruitment process and aim at hiring newly graduates with fresh ideas needed by the company, the HR manager should implement a recruitment tie-up with colleges and universities (Nowak and Grantham, p. 125). One major drawback with U-Soft human resource management is that it has confined the talent of its employees within time boundaries. Therefore, it is important for U-Soft to allow its employees to have the privilege to work within the comfort of their own home. In line with this, U-Soft should implement flexibility in their working time. By allowing employees to work 24/7 working time, software developers and designers will be able to think better and work well in terms of coming up with new and useful ideas. This strategy is useful in terms of motivating employees to work better at their own pace and time. Another way to increase employees’ motivation at work is to improve the company’s remuneration policy and secrecy. Since the salary offered by U-Soft is based on job position instead of job description, the pay grades used by the company can be bias to some employees whose work load is more than what the managers are assigned with. In line with this, U-Soft should draft its compensation plan, incentive criteria, and promotion policy on the basis of work contribution made by the employees. Fair treatment to all employees is crucial to the success of the company. Although a manager is superior as compared to a developer, HR manager should not deny the fact that the work contribution of developers is much more important than the work of a manager. In relation to the proposed wages and salaries, secrecy should be strictly implemented to avoid further organizational conflicts. As part of implementing the recommended solutions, the following work schedule should be followed: Short-Term Plan Draft new HR policies together w/ a mission, vision, and objectives     Deal w/ local school & universities Re: recruitment and work opportunities for newly graduates           Develop a draft on new work guidelines particularly on work flexibility           Design new remuneration policy for U-Soft employees                         1 2 3 4 5 6 7 8 9 10 11 12 week Long-Term Plan Finalize & Implement new HR policies                     Start Recruiting from colleges and universities                   Implement new work guidelines particularly on work flexibility                 Implement new remuneration policy for U-Soft employees                         1 2 3 4 5 6 7 8 9 10 11 12 month Implementing these newly proposed HR strategies could lead to the development of organizational conflicts. To effectively control and manage employees who are against the proposed policies and remuneration schemes, the HR manager should pay extra attention with the type of leadership style she is using. By choosing the best leadership style, the HR manager can easily convince employees to support the necessary changes in the HR policies. Conclusion Performance gap at U-Soft is caused by its HR manager’s inability to promote the importance of good leadership skills among the managers and align U-Soft’s recruitment policies, working environment and compensation grade system with the specific needs of the software designers. To increase the work performance of U-Soft employees, improving work environment aside from making recruitment and employment policies and remuneration packages aligned with the specific needs of competitive software designers is important. In line with this, benefits and remuneration packages offered by U-Soft should be equal or even more than what competitors are offering. Even though U-Soft was able to hire technically competent individuals to join the team, the inability of the HR manager to promote the importance of good leadership skill among the managers including the misaligned employment policies make U-Soft employees less motivated at work. The minimize cases of absenteeism and high turnover rate, the HR manager should immediately work on aligning U-Soft’s recruitment policies, working environment and compensation grade system with the specific needs of the software designers. Other than improving the company’s employment benefits and work policies, implementing organizational learning could equally motivate employees to increase their work performance. As a result of having motivated diversified workforce, the company could increase its competitive advantage as compared to its competitors. Thus, increase the company’s market share and profitability in the long-run. Implementing the proposed HR strategies could result to internal conflicts. To effectively manage internal conflicts and convince each employee to support the plan, the HR manager should not only make use of effective leadership style but also communicate with employees the need for these changes. By doing so, employees will be able to fully understand why these changes are necessary. *** End *** Works Cited “About U-Soft.” U-Soft. 22 May 2010 < http://www.u-soft.com.cn/site_en/about_02.html> Cowan, D. "Rhythms of Learning: Patterns That Bridge Individuals and Organizations." Journal of Management Inquiry (1995): Vol. 4, No. 3, pp. 222-246. Jackson, B.G. "A Fantasy Theme Analysis of Peter Senges Learning Organization." The Journal of Applied Behavioral Science (2000): Vol. 36, No. 2, pp. 193-209. Jay, Heizer and Barry Render, OPERATIONS MANAGEMENT, Tenth Edition. New Jersey, Prentice Hall, 2011. 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In Clegg S.R., Hardy C., & Nord W.R. (Eds) Handbook of Organization Studies. London: Sage, 1996. Read More