Human Resource management and performance at Egan's Clothiers Inc.

¶ … organization is fragmentized into several sub-organizations which work coherently to optimize the performance of the organization. Human Resource Department is viewed as sub-organization of relevance and importance in this respect. It is the Administration and Human Resource Department whose effective correspondence and correlation can improve all the activities under process within organizational structure. According to Karmarck A.M (author of Economics and Real World), the Human Resource Department and its functioning is the reflection of the organization's vision, and it is the HRD which handles the responsibility of introducing new faces into the organization, and training them so that maximum output can be extracted from them.

According to Karmarck, the economy of the organization is not counted upon its earning, rather its major criterion is the labor recruited by company. The labor cost and training are the subsequent steps that have to be looked after in the next step. The HRD is assigned to offer required professional training and learning sessions to the recruits, so that the recruits can practice their proficiency in competent manner. The organization is supposed to monitor and evaluate the performance of the recruits on the basis of performance and skills, and certain training sessions should be prescribed to the recruits. The salary and monetary compensations offered to the recruits and other employees should have variable grounds, the salary packages and other benefits offered should be on the basis of the department, performance, expertise and experience.

At parallel, continuous inspection and observation should be conducted to ensure that the recruits and departments are performing their tasks with complete understanding and coherence. Performance management is an important assignment, and the organizational heads should ensure that the departments are working in harmony so as to obtain maximum results. The momentum of research, production, sales, marketing and profit should be exhibiting positive trend, rather than bearish spell.

CASE OVERVIEW

Egan's Clothiers Inc. started its operation in 1958. The company was started by Gene Egan and Pat Pollock. The company experienced tremendous rise in its business activities, and by the end of 1980s the company established many of its outlets across New York and New Jersey. The company offers variety of products ranging from sportswear, dress wear to related fashion accessories. By 1999 the company has workforce of more than 2400 people, majority of which are sales person.

The company has been recording profit since it started gaining momentum during 1980s. However from 1997 to 1999 company was earning lower percentage of profit. The revenues climbed significantly during this period, however the increase in the expenses is the reason the low profits. The Financial Report of the company for the year 2000 revealed that major chunk of company's money was being spent on the incomes and training of its employees. The company has policy of recruiting people with experience, and after recruitment the employees are trained, because the company believed that investing on the employees and their skills will bring rewards to the company. The company also introduced a certain performance grading criteria, and employee record software was also installed in all the outlets of the company. The company was offering lucrative pay scales to its employees, and the salary package varied significantly from the other companies.

However even after investing major chunk of money in the employees and the skills development, the results were not outstanding. The external sources revealed that the internal departments of the organization had certain complaints and reservations for each other, and this was another reason for company's poor financial results. The company has throughout stressed more on the employee's expertise, and emphasis on the production and quality standard is partial.

INVESTING ON HUMAN RESOURCE

The company has taken concrete steps in providing employees with ample opportunity to grow and excel. The employees are trained after regular interval, with the hope that their sincere practices with gather more customers for the company. The company introduced computerized system for managing employees data and corresponding activities, the software was accessible from all the outlets of the company, and acted as an interface between different employees, so that they can easily come across each other. The software was also introduced so that the employees can be informed about their performance evaluation. Such a scheme provided transparent medium for promoting the employees. However all these schemes, including the software installation and training sessions have made company spent more than required.

Recruiting experienced individuals on higher wages, and than again making them undergo training sessions is more to termed as futile exercise. The company has two visible options,

Either to recruit fresh graduates on reasonable wages, and train them to optimize their performance.

Recruit experienced individuals, make them achieve higher targets in exchange for good salary packages.

Installation of software for the employees scattered in 34 outlets is not fruitful exercise. The company should have rather convinced the employees to correspond via Internet or Intranet facility rather than investing more than a million in this project.

Training sessions should be conducted not for all, but only for those employees who are bring fame and reward to the company.

It is better to recruit the employees on the contract basis, or rather introduce performance criteria for hiring.

The salary packages should be introduced in comparison with the market offerings. It is not in the interest of the company to offer high wages without receiving substantial gains from the efforts of the employee perfectly salary package should be devised offering reasonable wages, with handsome share of commission and rewards purely on the performance basis.

PROMOTION WITHIN The professional environment varies significantly from organization to organization. The recruited employees are pioneer for establishing conducive working environment. However if the same employees stay in for longer, and promoted after regular intervals will contribute little towards the reforming and modifying the company's atmosphere. It is therefore advisable for the company management to establish external recruitment policy, so that the newcomers can bring new dimension to the ongoing business and promotional activities.

Promotion Within provides employees with feeling of ease and comfort towards their profession and assignment. Therefore the company should discourage practicing Promotion Within policy, and only if the employee's performance is found up to the mark, then the promotion scheme should be applied.

The best way to optimize and extract maximum output from the employees is to created competitive workplace environment, this can be achieved if external recruitment is adopted. The company should encourage external recruitment, so that the old employees find it necessary to perform so that their job and contract remains secure. This policy can create unrest among the employees but if the management takes some precautionary measures, such that the sense of professional rivalries should be replaced by professional adventurism, the unrest can be controlled and monitored.

The promotion scheme should be applied after gap of certain years, and the promotion criteria should be performance rather than the experience of the employees. This policy will decelerate the promotional activities of the employees, and in this manner company's spending on offering luxury and high wages will reduce.

HARMONY BETWEEN THE DEPARTMENTS

The organizational activities can never be practiced by relying on the single department, and crediting it with the responsibility of conducting the task. The organizational task should be supported and shared by all the internal departments. The departments should be encouraged to work in proper correspondence with each other. The Egan's Clothiers Inc. should initially create professional and conducive work environment for its employees. The report that the internal conflicts between the departments are getting public exposure, and affecting the customers is discouraging. The difference of opinion is healthy sign, but differences should never be that severe that it turns out to be harmful for the organization. If the company affords to train its employees for improving the skills, it should also teach them to respect and practice professional courtesy towards its departments and colleagues. The company should either involve high management into dealing correspondence and related affairs between the department, the directors of the respective departments should be provided with ample opportunity of discussing their grievances and concerns openly in front of the management team.

If the company observes that internal conflicts are creating troublesome situation for the company, the situation can be easily handled by training the employees with knowledge of conflict management and conflict resolution.

EMPLOYEE TURNOVER

It is encouraging to observe that the company has healthy proportion of the employees present on particular working days, the ratio of absentees is minimum. It is therefore important for the company to discourage the practice of hiring individuals as an alternative. If the maximum number of the employees are showing up, it is encouraging to observe their commitment and seriousness towards their profession. Therefore the next task should be to extract maximum out of their availability rather than dumping their potential.

The company should primarily focus on employee management, and resource allocation to secure and attain high profits, employee's goodwill and customers satisfaction.

LESSON LEARNED

The Human Resource Department is of fundamental importance for an organization, but this does not justify the notion of investing major resources towards the growth and progress of the employees. Paying employees more than market value is not positive measure, and paying the employees higher because of their past experience is not appreciable at all. Recruiting experienced employees and then further spending on their training is not worthwhile policy, if the experienced recruit was to be further trained, what is the harm in recruiting the fresh graduates, paying them, reasonable, and investing on their skills and training accordingly.

I, under my authority, will ensure that my organization doesn't offer something that is costing me more than my competitors. Recruiting fresh graduates will be positive measure, because the fresh graduates have novel ideas with them. Training is continuous process applicable on all irrespective of their experience; therefore I personally view and agree with the company's investment on the training.

I'm firm believer of external recruitment and promotion, and therefore will ensure that the organization hires and promotes individuals externally, so that novel ideas can be welcomed and received. I personally desire to establish proper correspondence between the different departments of the organization, and in order to avoid any conflict and mistrust between the departments, I am motivated towards establishing strong medium for continuous correspondence between the departments chaired by me. All the grievances of the departments should be solved rather than being delayed.

A found Egan Clothiers least interested investing on launching advertising campaigns for their brands, I consider advertising to be important medium, that is much affluent than the salesperson. A single commercial can publicize my brand allover, where as the salesperson takes months and years to capture such market.