Human Resource Management. It a Case Study

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In today's challenging economic and business environment, managers are often faced with a dilemma regarding the human resource policy that is best applicable. In this particular case study, an important problem is brought forward: what is the optimum dimension of the workforce in an organization? There are several dimensions to this problem that will be discussed in this paper, including the challenges and consequences of having an adequately large workforce, motivational theories that apply to the employees etc.

The premise of the issues described in the case study is simple: in the present time, the economy no longer has a predictable trend. With stagnation and economic recession just passed, the economic and business environment has not truly returned to the levels from before the crisis. Even worse than this, one is never sure whether it actually will. With all that in mind, what are organizations to do? Should they retain the current workforce, in hope that the future will bring higher demand for their products and services? Should they let go a number of people, so as to be more dynamic and reduce costs?

Each of these actions come with a number of consequences. Letting people go without a proper analysis may mean that, when the time comes to hire people go, the company will have a spike in its costs, because recruitment and selection are also costly processes. Retaining the people comes with salaries, benefits etc. If the company is not producing enough, then retaining additional people is not useful.

The case study presents alternative solutions that some of the companies have come up with. Some of these promote flexibility in the workforce. Flexibility has many faces, but, mainly, it aims to allow the company to reduce some of its costs without letting the people go altogether. Flexibility includes part-time jobs, reducing the number of hours one works in a week and sending some of the people to do their job from home, thus reducing the costs associated with supporting an individual at the workplace.

There are several issues that this approach brings about, but the first element to be discussed in this paper is the motivational factor. A discussion around motivational theories should start with a reference to Maslow and Herzberg. Maslow's hierarchy of needs (Maslow, 1943) is part of the larger category of motivational theories based on the needs of the individual. In this particular case, he divides the needs into five categories: self-actualization, esteem, love and belonging, safety and physiological.

The flexible approach that some of the companies presented in the case study have aimed to implement have a negative consequence on at least a couple of categories from Maslow's hierarchy. The physiological needs are not affected, but everything from there upwards (safety, belonging, esteem and self-actualization) will be negatively affected, with the potential of decreasing the work performance of the employee. This will be investigated in detail further below.

First, the perception of an employee who is moved from a full-time to a part-time position is that he or she is the first or among the first that will be let go in case of a downsizing. With this in mind, he will be concerned about the safety of his employment and this particular need from the hierarchy will no longer be properly tended to.

Second, a part-time employee is no longer part of the full-time team. There will be activities that he will not be part of, because of his schedule, and will miss on some of the activities that generally informally boost team spirit, from discussions over a cup of coffee to running into a colleague on the hallway. This will also likely affect his performance within the organization.

This has also been pointed out by studies that emphasize that, in many situations, employees identify themselves as both the part of the organization and, to the same degree, as part of a dedicated workgroup that shares similar beliefs, objectives (both organizational and strictly group-related) and work areas (Van Knippenberg, 2006). For these employees, it is difficult to break away in that manner and to restrict themselves to a part-time job that no longer provides the same group identity.

Third, the need for esteem is one of the best motivational factors for the employee. As shown in one of the previous paragraphs, the employee is likely to perceive a change from full-time employment to part-time employment as a demoting action by the organization rather than as a measure motivated by financial and economic necessities.

Fourth, self-actualization is supported by courses, trainings and seminars that the organization puts together for its employees. If an employee is only a part-time employee, it remains to be seen the degree to which the company will still be committed to investing into the development of that respective employee, especially given the economic constraints that led to that situation in the first place.

It is in this context that one should note, however, that these needs and the degree of necessity and satisfaction varies from culture to culture, as Tang and Ibrahim have shown in their studies (1998). In the Middle East, for example, some of the needs that might otherwise appear redundant in the Western world, are still essential, because of their scarcity, in these regions. For example, basic physiological needs are covered in the Western world, even if the employee moves to a part-time position, but a resource such as water remains a resource that may be affected if the employee moves to a part-time position in the Middle East.

Many theoreticians came to argue that, in fact, the hierarchy of needs, as proposed by Maslow, does not fir every culture and that it is rather a reflection of American culture and values (McFarlin, Sweeney, 2010). As shown in the previous example, some cultures may look to physical safety and basic physiological needs as more important than the upper levels of the pyramid.

An interesting differentiation in the hierarchy of needs is brought by Haire, Ghiselli and Porter in their "Managerial thinking: an international study" (Haire, Ghiselli, Porter; 1966). They show that there are differences in the way the hierarchy of needs is structured across different cultures, but, even more so, across the different layers of the organization, with managers reacting differently to the hierarchy of needs than the rank-and-file employees.

In countries in Europe, self-actualization and some of the other upper levels were the most important, but in the Chinese culture, it is the belonging need that is likely more important, shared by other countries in East Asia and Asia in general. Managers have greater concern for the upper levels of the hierarchy of needs, while the rank-and-file employees are more concerned with things such as the safety of their employment and their family.

Jelavie and Ogilvie (2010) bring an interesting argument, derived from Hofstede's research into motivation across cultures and cultural differences. They believe that the English-speaking world has particularities in needs that differentiate it from the rest of the countries and cultures. In their opinion, for most of these other countries, it is the safety and love/belonging that always rank higher in the pyramid, rather than the other way around, as tends to be the characteristic for the English-speaking world.

This leads to a reverse discussion than presented in the case study. Certainly, on one hand, one should consider the fact that multiple time-zones creates difficulties for managers in terms of their sleeping and working schedule, but one should also consider that the respective cultures may have different priorities in terms of the needs they want to satisfy. The discomfort of a night with less sleep can be quickly covered by the material safety for the family that this decision can satisfy.

This means that a decision to transform a full-time into a part-time decision also needs to take into consideration the cultures in which the organization is working and how this type of decision will have an impact for local employees. In a Middle Eastern or Asian country, getting to spend more time with the family will target exactly the belonging and affection need that was revealed to be so important by several of the studies that were discussed here. The decreasing participation in the activities of the organization will likely be revealed to be less important than this, so such a decision would make sense in these regions.

For the reasons that have been previously listed, such a measure may have a directly opposite effect, the decrease in efficiency and productivity for the employee translating, eventually, into an additional cost for the organization, that would need to supplement this in different other ways.

Going back to the work-life balance, there seems to be a general agreement that a multifaceted identity that each individual has today, perhaps more obviously so than at any time in the past. The identity is one that is split between the work identity and the personal identity (Tracy, 2000). The question that can be applied in this case study is whether or not transforming full-time employment into part-time employment, the organization apply too much pressure towards balancing the individual's identify more towards the life side of things and lose thus their partial influence on the work side.

This is not necessarily a matter of whether the employee will give the same productivity performance when he is at home against when he is the office, although a discussion can be launched as to whether the employee is potentially subjected to distractions at home that do not exist at work. It is, however, a matter of whether he will still associate himself with the organization in this part-time framework to the same degree to which he would do so when he were a full-time employee.

Certainly, technology helps to keep the connection still strong between a part-time employee and the organization that employs him. Some studies have implied that the relationship and connection between organizations and employees is no longer blurred even outside of the strict working environment, because technology control can be applied just as well as other forms of managerial control (Barker, 1993).

A new workplace was created, one that is no longer a physical one, but a combination of virtual and physical (Boswell, 2007): the employee is occasionally at work and, at other times, he is simply connected through a variety of technological means, ranging from emails to video conferences and the cell phone/Black Berry. This type of interconnection will encourage the employee not only to retain the same levels of productivity (or the management to be able to enforce that), but will also cement his relationship with the organization, even if, as a part-time employee, he is no longer present on a full-time basis in the company offices.

Going back to the case study, beyond flexibility, there is an underlying presentation that some companies lay off some of the employees to reduce costs, but, at the same time, increase the work volume and working hours for the other employees, with the obvious objective of retaining the same level of output, despite a minimization of the workforce.

One of the obvious questions that arises here and to which the case study clearly alludes is whether longer working hour have a negative impact on the individual and, with that in mind, whether this negative impact can also be translated into a decreased productivity for the respective employee. It looks as if many of the studies are still split on many of these elements.

On one hand, "literature suggests that there is an association between working long hours and fatigue" (White, Beswick, 2003), but no specific association between the work performance effects and these long hours. There is also strong evidence that working long hours creates an inappropriate work-life balance, to the degree to which the line between the two becomes blurred (White, Beswick, 2003). Other studies conform the ambiguity of overall research on the negative impact of long-hour on the individual's life (Ratzel, 2009).

The actual work-life balance is based on the neoclassical theory of the individual labor supply that "considers income and leisure as the source of individual utility" (Ratzel, 2009). The theory reflects the decision making process that each individual is subjected to: more work creates more income for more consumption, but decreases time for leisure, almost in a proportional manner. The individual (and, as the case study shows, many organizations as well, as they consider the happiness of the individual as one of the elements affecting his performance) will try to create the appropriate balance between the two in order to maximize his satisfaction.

Even if its original area of study was fiscal policy and the effect of increased taxation over the amount of collected income, the Laffer Curve can also be used when discussing the relationship between working hours and performance. Most of the studies mentioned here point out that there is no clear, empirically demonstrated relationship between longer hours and decreased performance at the workplace.

However, one can assume that, similarly to the Laffer Curve, there is a certain number of hours of work during which an individual performs best. Beyond those hours, it is also reasonable to assume that his or her performance stabilizes at a certain level, only to decrease if the number of work hours becomes unreasonably high. Beyond empirical studies, it is common sense that this would happen, if one looks at how an individual generally works and operates.

In this context, the organization should give a proper analysis of the degree to which full-time work can be transformed into part-time work, with the underlying plan of actually supplementing the working hours of an individual by creating the false impression that, because he works from home, this actually improves the work-life balance in his favor.

The same principles of work-life balance should be applied even if a part-time activity means that the employee spends more time at home. This should not be mistaken with more time spent with his family, mainly because time at home while on the job is still working time, time during which the individual is involved in organizational activities.

Some studies differentiate between flexibility in the workplace and reduced time, equivalent to part-time positions. The case study appears to be referring to the latter case, while flexibility in general covers a larger area, including flexible working schedules or flexible leaves (Friedman, n.a.).

At the same time, studies cite the numerous benefits that flexibility in the workplace appears to bring to employees. Randstat's study (2008) showed that flexible hours and paid time off remained some of the most appreciated benefits by employees, almost as competitive as a competitive level of salary and health insurance. However, at this point, one should emphasize that flexible hours is not equivalent to part-time jobs and that what the case study is proposing goes beyond the simple flexibility of leaving the workplace whenever the employee needs to.

It is thus important to differentiate between imposed reduced work and preferred flexible hours and an overall flexible approach to the employee's obligations. The case study shows the situation of companies that are forced to introduce part-time positions to replace full-time positions because of challenging economic conditions. One would expect that the introduction of flexible approaches in the workplace is not necessarily something forced, but rather a new human resource policy aiming to increase productivity and efficiency in the workplace.

This discussion is also supported by arguments from the Sloan Center on Aging and Work (Pitt-Catsouphes; Matz-Costa; Besen, n.a.) define flexibility and flexible work options into five different categories: none of these refer to reduced working hours, but rather to flexible schedules, flexible place (thus, the possibility of working a full-time positon at home), or flexible options for time off, encouraging the employee to take days off whenever he or she have personal issues to solve.

The case study actually seems to be presenting the situation of a series of organizations that seemingly discovered a way of retaining personnel without paying them for a full-time job. In the beginning of this paper, we looked at the fact that the main challenge for these companies was to identify the right level of employment at which the company could lower its costs, but, at the same time, still count on the same number of employees. This would help when or if the economic environment would rebound to higher levels of demand for the company's products or services.