Exam (elaborations)
HRM3704 EXAM PACK
- Institution
- University Of South Africa (Unisa)
Exam of 131 pages for the course HRM3704 - Contemporary issues in Human Resource Management at Unisa (HRM3704 EXAM PACK)
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EXAM PAPERSMAY/JUNE 2013
SECTION A – CASE STUDY
QUESTION 1
Read the following case study and then answer the questions that follow.
Happy Sky Company: Aligning human resource functions with strategic objectives.
Happy Sky Company is a company that produces anything from cutlery to toiletries for all South African Airlines. Although
Happy Sky has been profitable over the decade of its existence, its productivity has recently declined. In the past several
years, their employees have displayed diminished innovativeness, a higher turnover and absenteeism, and an overall
sluggish performance.
Based on these trends, Paul (the founder of the company) calls a meeting of all the managers to discuss potential courses
of action to correct the problems. After a lengthy meeting, they agree to hire a full-time HR manager to assume sole
responsibility for the employees. Previously, the line manager had assumed basic responsibility for managing their
employees.
After careful consideration, Paul decides to hire Kgomotso Molotsi, in line with the company’s new employment equity
policy, to assume the primary responsibilities of developing a systematic HRM function for Happy Sky.
When Kgomotso arrives at Happy Sky, she meets with Paul to discuss the strategic objectives of the company. Paul
indicates that the two primary objectives of Happy Sky are, firstly, to continue its growth strategy to respond to growing
demands for its services, and, secondly, to enhance the innovative nature of the workforce, in order to ensure that it
remains competitive and up to date with market changes. Paul gives Kgomotso the task of developing and HRM function
that will tackle the absenteeism and turnover problems while helping Happy Sky attain its two primary goals.
As a first step, Kgomotso begins by reviewing the HR practices used at Happy Sky. It becomes clear that the company relies
primarily upon two practices to meet its employee needs. Firstly, it recruits at the local university just 10 kilometers away.
If graduating students are not interested or are unsuitable candidates for a certain job, Happy Sky places advertisements in
regional newspapers to seek job candidates with the relevant skills who are willing to relocate. Although this hiring process
is not comprehensive, Happy Sky has not experienced much difficulty in recruiting employees, thanks to the growth
opportunities it offers.
Secondly, Happy Sky has relied upon an established compensation system that applies to all employees throughout the
company. Employees are paid salaries, the compensation level being based on the going market rate for similar positions.
Annual salary increases are calculated according to inflation and individual performance. The average salary increase is
between 3 and 7 percent of an employee’s basic salary.
Kgomotso realises that, besides these recruitment and compensation practices, no other HR practices are consistently
applied at Happy Sky. Instead, managers use different methods of managing the employees in their respective
departments. For example, no uniform performance appraisal standards are applied throughout the organisation. Criteria
used to evaluate employees range from counting days absent to measuring innovation and creativity. Similarly, each
manager uses somewhat different tactics for training employees. Some units assign new employees to shadow more
experienced employees, who serve as the new employees; mentors. Other managers do not offer any training and assume
that the employees come to the job with all the knowledge they need to succeed.
In the light of the organisation’s goals of growth and innovation, Kgomotso realises that significant changes need to be
made at Happy Sky. The productivity of employees and the success of the company depend on effectively realigning the HR
function.
1.1 Suggest specific HRM practices that could facilitate Happy Sky’s strategic objectives of growth and innovation.
1.2 Happy Sky employs 10 sales representatives to sell its software products. Name and describe various criteria which
can be used to evaluate the performance of these sales representatives.
QUESTION 2
Read through the following case study and then answer the questions that follow.
Global HR at McDonald’s
One of the best-known companies worldwide is the McDonald’s Corporation. This fast-food chain, with its symbol of
golden arches, has spread from the United States (US) into 91 countries. With more than 18 000 restaurants worldwide,
McDonald’s serves 33 million people each day. International sales represent an important part of McDonald’s business and
more than 50% of the company’s operating income comes from sales outside the United States.
Operating in so many different countries means that McDonald’s has had to adapt its products, service and HR practices to
legal, political, economic and cultural factors in each of these countries. A few examples illustrate what kind of adaption
had to be made in some countries, such as India, beef is not acceptable as a major part of the population, so McDonald’s
uses lamb or mutton. To appeal to Japanese customers, McDonald’s has developed teriyaki burgers. Separate dining rooms
for men and women have been constructed in McDonald’s restaurants in some Middle Eastern countries. HR practices
must adapt to different cultures. Before beginning operations in a different country, HR professionals at McDonald’s do
research on the country and determine how HR activities must be adjusted.
One method of obtaining information is to contact HR professionals from other US firm operating in the country and ask
them questions about legislation, political factors and cultural issues. In addition, the firm conducts a detailed analysis to
ensure that all relevant information will be gathered. Data gathered might include what employment restrictions there are
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