HUMAN RESOURCE- VALUE AND CONTRIBUTION TO ORGANIZATIONAL SUCCESS
The human resource of an organization needs to be managed properly because it will directly affect the sustainable performance of the company. HR is associated with how to properly measure every area of human resource for developing the functions of the organization for creating more value from the activities of this resource. For understanding this attribution of human resource management, the organization Amazon will be evaluated under this report. The organization is hiring worldwide and more than 245200 employees all over the world. By analyzing Amazon under this report, the proper knowledge about the management of human resources for improving the performance and profitability of this organization can be understood. The major focus will be given to organizational design, the motivational process for employees, the use of contemporary knowledge and technology, and the change in the management structure.
Task 1- LO1 & LO2
P1 The importance of organizational design theory in the context of organizational structure and fulfilling organizational strategy
For structuring and operating the members of the company, Amazon uses the way of organizational design. The organizational design is considered as both a plan and a process.
There is an interrelationship between organizational structure and strategic aim with the organizational design. Like every organization, Amazon has its own strategic aims, which include the large objectives of this E-Commerce organization for increasing its market share and productivity rate. Developing the statistical position of the business is the major area that is focused on the strategic objectives (Armstrong and Taylor, 2014). The organizational design is being restructured depending on the changes of strategic aim. The organization structure represents the hierarchy of Management where the organization subdivided the major area depending on various responsibilities and functions.
The organizational design model- The model developed by Weber is an example of the classic organizational design model. Still, now famous organizations like Amazon are using this model for preparing the organizational design. This model mainly focuses on formal rules and procedures for structuring the organizational hierarchy. This hierarchy mainly attached to the organization and its different members (Bolman and Deal, 2017).
Designing organizations to meet strategic aims-There is a very important connection between the organizational structures in the development of the Sustainable performance of the company. This is because the organization structure focuses on various activities like supervision, task allocation, and coordination for the achievement of organizational aims. The organization structure also develops by concentrating on providing care, efficient, innovative, and flexible process for the employees which will help them in creating a sustainable competitive advantage (Carayannis et al. 2015). The formalized pattern of the organizational structure shows an introduction between the company’s task, people, and Technology.
Contemporary OD-There is three different types of organizational structure mainly used by large organizations for achieving strategic objectives. Those are functional structure, divisional structure, and matrix structure (Bratton and Gold, 2017).
As per the four basic principles of Amazon, it is using the matrix structure for focusing on both the functions and product simultaneously. The use of matrix structure does not only help in accomplishing the work by using the employees but also increases the advantages by focusing on the functions. The advantage of using the Matrix structure is the effective use of resources (Leih et al. 2014). It is also beneficial for both horizontal and vertical communication process. Besides that, there are both types of focus in the organizational operations and employees which help in reducing the difficulties of the new organizational environment. Managing the resources is easier and the cost can be easily measured by focusing on every single project objectives. The utilization of resources can be handled more flexibly in this process (Burton et al. 2015). There are also disadvantages to using Matrix structure because it is difficult to manage out of its complexity.
The impact of the external business environment- The external business environment of the business of Amazon is mainly affected by the competitors in the market and the legal and political situation. Besides that, as an E-Commerce business with technological changes can also create a huge impact on the organizational design of Amazon. Therefore, the organizational hierarchy design is redesigned by the Human Resource Department depending on external business environment factors.
An agile organization has some specific characteristics for developing a strong human resource. These characteristics include work-life balance and consistent delivery which is directly related to the organizational goals (Camaj, 2018). The sustainable and successful business process for developing customer value is possible in this type of business, where the flexibility of work is possible for the employees. It is directly connected with the collaborative and smart decisions of the human resource manager.
- Galbraith Star Model – Jay Galbraith has developed the star model process for analyzing the companies in the year 1960 (Leih et al. 2014). Depending on this model, Amazon can improve the organizational design depending on its choice. In this model different design policies are available, and it is helpful for influencing employee behavior.
The design policy of the star model has divided into five categories. Those are:
Strategy- The strategy of the organization refers to the process of determining the direction for the organization and its employees (Armstrong and Taylor, 2014).
Structure- The second category is the structure of the organization which is associated with determining the specific position of all locations of decision-making power.
Processes- the processes include the various function of the organization which includes the flow of information. In addition to that, the process of responding to information technology is also part of it (Pereira-Moliner et al. 2016).
Reward- Reward is the fourth category which is useful for providing intensive and motivation for the human resource for the desired behavior from them (Bolman and Deal, 2017).
Selection and development- Finally the selection and development of the right people is also part of this module which is useful for organizational growth and can easily maintain the corporate policies. This category of star model allows the company the process of operating at maximum efficiency.
- McKinsey 7s framework – McKinsey 7s framework is developed in the year 1980 for the process of developing organizational design depending on the necessity of the organization (Carayannis et al. 2015). The primary purpose of using this 7s model is to improve the performance of the organization. Besides that, examining the future effect of changes in the organization, at that time of acquisition or merger aligning the processes and departments, determining the best strategy to implement are the part of this model implementation (Bratton and Gold, 2017).
The seven elements of the 7S model are differentiated into two different types. The hard elements are associated with Organisational Management and structure fun influencing the human resource. For example, the reporting lines, IT system, formal processes, strategy statement, and organizational charts can be included (Burton et al. 2015).
The soft elements are similarly important and difficult to describe because it is influenced by culture and less tangible than hard elements. The organizational policies and ethics, interpersonal and communication skill of the employees, different type of leadership styles like the democratic leadership style, etc.
- Congruence model- Organisations use the congruence model for developing better productivity and profitability by using different components within the organization. The four different elements are selected for which can be compatible with each other for producing the best quality of efforts. This model has derived in the year 1980 by Nadler and Tushman (Carayannis et al. 2015). The four different elements which are identified under this model are culture, structure, employees, and tasks (Camaj, 2018).
Step2: Relationships between the elements
Work and structure- There is a very important relationship between the work and structure of the organization. Depending on the activities or functions of the work the organization has to select a specific structure. A compatible relationship within the work and structure develop the performance of the organization.
People and structure- The structure of the organization is related to the performance of the employee. Depending on the structure the work distribution within the employees has been done.
People and culture– The people or employees of the organization and the organizational culture are associated with each other. For maintaining minimum ethics and discipline within the organization, culture has been developed by the company. By maintaining the policies and ethics, the people are employees improve the organizational culture for better performance (Bolman and Deal, 2017).
Culture and work- The organizational work and culture are associated with each other. The corporate culture has developed by the management depending on the job or functions of the organization. The work also impacts the culture development process.
Culture and structure– The interrelation between organizational structure and culture is also significant because depending on the external factors, the structure of the organization improves. And with the improvement of the corporate structure, the organizational culture changes (Carayannis et al. 2015).
Build and sustain congruence- The third step of the congruence model is associated with building and sustaining congruence. The application of this model is not only useful for building a better organizational design or structure. It also helps in strengthening the sustaining strength of the organization. This process not only changes the structure by implementing a new design but also enhances the previous one (Bratton and Gold, 2017).
P2 The different approaches and techniques used for attracting, maintaining developing, and rewarding human resources to create a skilled and dedicated workforce
There are two different types of motivation which are extrinsic motivation and intrinsic motivation. The role of these two types of motivation is seen in the human resource management system of Amazon.
Extrinsic motivation generally comes from the outside of an individual. This motivation process is used by Amazon by providing incentives, money, and rewards to the end. Giving promotion is another process of extensive motivation. By the use of this motivation process, the basic skills can be developed reinforcement of good habits and encouragement of self-efficiency is possible (Carnall, 2018).
Intrinsic motivation comes from a leader or manager of the organization. This motivation is given by the managers all leaders to the employees for meeting the objectives of the organization. Self-directed learning and the deepest level of learning and thinking are the use of intrinsic motivation. Both types of motivation processes directly affects the behavior of the employees which can be both positive and negative. (Carayannis et al. 2015)
The motivation theories are divided into two different types; those are content theories and process theories. The content theories are Maslow’s hierarchy of needs and Alderfer’s ERG theory. The process theories include Adams equity theory vroom’s expectancy theory and Latham and Lock’s goal theory (Collings et al. 2018).
Maslow’s hierarchy theory– Maslow’s hierarchy theory is subdivided into five different levels which are the need motivator of each of the employees. Those are the psychological need, safety and securing, love and belonging, self-esteem, and self-actualization. According to Maslow, every employee has these basic needs, which need to fulfill by motivating them.
Alderfer’s ERG theory– In this theory, three different types of needs are identified. The existence needs, the relatedness need, and the growing need are the basis of this content motivational theory. The existence need refers to the psychological and material need of the individual. The relatedness need is the desire for interpersonal relationships. Finally, the growth needs refer to personal growth and development (Cummings et al. 2016).
Equity theory– the equity theory of motivation mainly focuses on the input and output from the job motivation. The inputs are provided by the employees in the process of working in the organization like loyalty, flexibility, commitment, personal sacrifice, etc. The outputs are the bonus, pay, benefits, security, development, enjoyment, responsibility provided by the organization.
Expectancy theory– the expectancy theory focuses on the behavior which is helpful for influencing the employees in the process of achieving goals. This behavior can be referred to as the hard work performed by the employees of Amazon which leads them in achieving the goal of promotion (Doppelt, 2017).
Goal theory- the goal theory refers to the process of achieving the goal. For achieving the goal, the managers and leaders are continuously providing feedback on the performance of employees in Manager which is an example of using goal theory (Carayannis et al. 2015).
The motivation provided by the human resource manager of Amazon is directly helping the employees in developing their performance and achieving the organizational strategy aim. Besides that creating a competitive advantage in the market e-commerce Retail Industry is the basic organizational objective of Amazon. Therefore the use of motivational theories helps the manager in developing low-level motivation and minimizing the organizational issues. All these together support the competitive advantage strategy of Amazon (Marchington et al. 2016).
M1 Application of appropriate theories and concepts to critically evaluate the importance of organizational design
Theory of change- The theory of change is known as a comprehensive description of how the desired change can be possible in a particular context. For the process of organizational redesign, the theory of change is helpful for developing the planning and mapping the essential needs to change. The organization Amazon can apply the theory of change for changing the areas which need to redesign the organizational hierarchy for the process of development and growth (Pereira-Moliner et al. 2016).
Mckinsey’s 7s framework- this Framework mainly focuses on the seven different elements of organizational design. The elements are divided into the hard element and soft element (Rudolph, 2016). The hard elements of the organizational design indicate the system, structure, and strategy of the company Amazon. However, the soft elements of Amazon are the stuff, style, skills, and shared value. The interdependence of these hard and soft skills is beneficial for establishing or redesigning the organizational design of Amazon.
(Source: Rudolph, 2016)
M2 The different approaches and techniques to motivation, human capital, and knowledge management
The process of job analysis helps in understanding the requirements of the job. For every individual job role, Amazon offers different roles and responsibilities. But every role and responsibility have a common in which is to achieve the organizational objectives.it is the responsibility of the human capital of Amazon E-Commerce organization, to manage the knowledge of every job role by providing them proper motivation. These motivations are provided by the HR of Amazon with the process of giving feedback to the employees. There are several initiatives, which are given to specific job roles according to their working pattern and growth (Santos et al. 2015). The behavior of the employees in the internal organizational environment is also counted for the process of giving promotions and rewards. Besides that, the contribution of each of the employees in the requirement of organizational aims and objectives is part of the knowledge management of HR. The process of knowledge management has a huge impact on the human resources of Amazon. This is because of improving organizational productivity and profitability.
D1 The suggestions based on a synthesis of knowledge and information to show how to improve the delivery of sustainable performance
From the knowledge gathered about the organizational design and motivational process of Amazon, it can be said that for delivering the sustainable performance of this organization management of human capital is very important and significant. Sustainable performance indicates towards providing growth and development of Amazon. Sustainable performance is not only beneficial for the organization but also associated with the improvement of performance in each of the employees of the organization (Armstrong and Taylor, 2014). Therefore, for the sustainable performance delivery of Amazon, this association needs to develop proper motivational Tools and techniques for human capital. Besides that, the various changes in the organizational design need to properly measure by HR. The main focus has given on developing new skills and motivation among the employees. The process of changing is replacing employees need to be avoided because the human resource of this organization is experienced in their job.
Task 02- LO3
P3 Conduct research and use contemporary knowledge and research to support emerging HR developments
With the use of effective research skills, there are some different contemporary HR developments identified in the process of human resources. For instance, the current strategy used by HR of Amazon is the alteration of organizational rules for managing human capital over time. The uses of analytics and data tools are used by HR for the process of understanding the performance of employees (Bolman and Deal, 2017). The introduction of an integrated workforce management system and the engagement of employees in every level of work have given more priority than before (Pereira-Moliner et al. 2016). In addition to that, the process of emerging the business and the performance review marking are the other areas where HR has worked. Focusing on the requirements of the human capital and the introduction of various mobile technologies for developing human resource management are part of the HR development.
M3 Evaluate how emerging HR developments will affect the role of the HR function in the future
There are various HR developments that are going to affect the HR practices of Amazon in the future. For example, the use of technology is going to improve the area of Human Resource Management for the future by reducing the workload of the HR. Except that, the workforce behavior and culture will be changed depending on the various marking provided by the HR review process (Bratton and Gold, 2017). All of the HR development processes will increase the performance of human resources which will directly help in meeting the needs of the strategic aim of Amazon. Besides that, a better work-life balance will be possible with the introduction of Technology like HR software and mobile technology. There is an interrelationship between cross-cultural engagement and HR practices. A diverse workforce works under the organization Amazon. For maintaining this cross-cultural workforce the use of motivational theories will be beneficial. There is a huge impact of globalization on the function of HR in the future. Globalization embraces the area of the work environment. The use of modern technology will be used more rapidly by the adaptation of globalization. Therefore the complexity of HR performance will increase in the future. Meanwhile, the development of Human Resource Management will be helpful for developing the sustainable performance of the organization (Burton et al. 2015).
D2 Making valid judgments and conclusions supported by a synthesis of knowledge and research information
There are a few different barriers and challenges which are faced by the HR development process of Amazon. Those are the lack of support by the managers all leaders of Amazon for developing the human resource. The value of human resources is still not properly understood by the leadership. Besides that, sometimes there is a lack of time, resources,s, and funds for developing human resources. There are limitations in the capabilities of organizational leaders and managers for the development process of human resources. The qualities of the HR team, proper capability, knowledge are required for developing the best quality of Human resources who can contribute to the achievement of strategic aim (Camaj, 2018). Finally, there is a continuous change in the competitive market of Amazon which has a huge impact on human resources. Therefore the proper structure is needed due to the external changes, which is not always possible.
Task 03 -LO4
P4 The ways organizational design has to respond and adapt to change management and the relationship that exists between the two using a specific organizational situation.
For adopting the change in the organization, Amazon uses different types of strategies for minimizing the impact. Initially, the organization implements the change on a small scale for minimizing the effect. Amazon also allows for the failure of this small-scale change. Besides that, feedback is taken from the internal and external stakeholders about the change. The organization also focuses on ingrain learning for the proper adaptation process (Carnall, 2018). Promoting accountability and process focus change at the basic area of understanding the organizational adaptation of change. finally, the decision-making process related to Change management is focused on the main stakeholders of Amazon. Those are the employee and customers.
The organization Amazon is associated with using the radical change management approach. This radical change helps in adopting new approaches for meeting the objective or requirements of change. The changing environment of Amazon for the adaptation of change is not only associated with designing the organization but also effective for the management of change. The radical approach helps in introducing new methods and techniques for adopting the change done for the development of organizational performance (Collings et al. 2018).
There are different Change management models that are used by organizations for the adaptation of change. For managing the human resource, the organization Amazon is using Lewin’s Change management model. This Change management model is differentiated in three different levels. Those are unfrozen, change, and refreeze.
Figure 10: Lewin’s Change management model
(Source: Cummings et al. 2016)
Unfreeze- This is the first stage where the organization prepares itself for adopting the change by refusing the old ways and processes. In this process, the organization Amazon provides the employees with basic information about the change and its need.
Change– The second stage of this model is associated with adopting the change by implementing new innovations and strategies (Cummings et al. 2016). The role of the employees is very effective in this process of change. Most of the adaptation is done by the employees for changing the total structure of organizational design and development.
Refreeze- This is the final stage of using the model. In this stage, the adaptation is change already accepted by each of the employees and the old process is no longer exists in the organizational system. The effect of the change can be measured from this stage onwards.
M3 The different types of changes that can affect the organizational design, including transformational and psychological change
From the discussion, it can be identified that there is variation, which occurred in the process of changing the organizational environment. But the biggest failure is the human capital of Amazon. This is not only because of the huge number of employees worldwide. But there are differences in the interest, values, and cultures of the human capital. The organization mainly focuses on the growth and sustainable performance of the organization. Each of the employees has their own interest. Some are associated with developing their professional career. Some of the employees also work based on the motivation given by the managers and leaders of Amazon (Doppelt, 2017). There are basic needs for each of the employees and those are similar to each other. But the job role and designation give an extra advantage to some of the employees. It has been identified that because of the dissimilar need of the employees developing a proper organizational design is not possible for Amazon. Therefore the organization focuses on developing a strategy based on the market. This process is helpful for developing a sustainable performance for improving the competitive advantage.
D3 The complex relationship between organizational design and change management
The relationship between organisational design and Change management is full of complexity. The organisational design is developed by Amazon for improving performance and growth. There are multiple barriers in the process of redesigning the organisational design. Similarly, it has been identified that the Change management process is useful for developing or restructuring the organisation. But a number of challenges occur in the process of Change management (Marchington et al. 2016). The external factors of the business environment in Amazon play a major role in the organisational design and Change management process. But the main complexity is found out in the internal organization of Amazon. The major impact of organisational design and Change management is seen among the human resource of this organisation. Because most of the change and redesign of the organisation, has been followed by them. They have some specific expectation from their workplace, which is being disrupted because of this process of improving sustainable performance (Rudolph, 2016).
In light of the above discussion, it can be established that Amazon is one of the largest E-Commerce business which is spread all over the world. The number of employees is increasing in this organisation because of the programs and careers offered by this organisation to its staff. The major principles, which are the basis of Human Resource Management in this organisation, are customer obsession, the commitment of operational, excellence passion for invention, and long-term thinking. The effective leadership program and career development are provided by this organisation to the millions of employees are the reason behind the sustainable performance and growth in the e-commerce industry.
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