How Effective Human Resource Management Improves Productivity of Employees

The human resource management plays a significant role in the organization. It manages the companies most valuable resource; the employees. The productivity of employees determines the profitability of the company. The human resource management therefore looks at the concerns of employees by linking them to the overall performance of the company.The HRM process is put in practice in organizations through planning, organization, development, co-ordination, and control of a set of techniques that are able to promote an efficient and effective performance from all those who work in the organization (Dessler, 1984). It performance however is affected by challenges. This study will look at how the human resource personnel perform the business functions while addressing these challenges. The aim of this study is to investigate the human resource practices being used in a company. The study uses the human resource management of Reyes Fitness Center.

Organization’s Capabilities and Employee Competencies

The Reyes Fitness Company is a medium-sized fitness center enterpriselaunched in May 1999. The center offers a full range of workout equipment, exercise classes, personal trainers, an outdoor pool, on-site daycare, and even a small restaurant.The market niche of the organization entails making fitness centers. From 1999 to 2007, the company has opened 28 fitness centers. Its revenue base has since increased despite the competition from their competitors. The targeted market niche is because of the high emphasis of health and recreation in the United States. The organization chart of Reyes Fitness Center is shown in Figure 1 and Figure 2 in the appendix.

The fitness center hires professionals and support staff in response to the need basis of the company. Some focus on personal training and employ a large number of certified professional trainers who work with members during club hours (typically 5-6am until 10pm).

More body-building oriented gyms have recently started offering 24-hour service. In addition to housekeeping and front desk staff, fitnesscenters employ customer service representatives who can assist existing members with questions and also act as sales representatives, giving tours of the facility to prospective members.

SWOT Analysis

SWOT is an acronym for Strengths, Weakness, Opportunities and Threats. The human resource in performing their mandate is affected by both internal and external factors. Some factors works to the advantage of the company while some pose as a challenge. Human Resource planning is one of the most important aspects of Human Resource Management, indispensable basis for all other practices. It must regard medium and long-range terms (Câmara, Guerra & Rodrigues, 1997) in order to conciliate organizations goals and employee’s needs and perspectives

Strengths

The head of Human Resource department at the Reyes Fitness Center, Lori, has been instrumental in streamlining the human resource duties and responsibilities. The human resource staff understands their duties, and how their contribution in providing a fitness club experience to couples and families that is superior is critical to the company and its advantage againsttheir competitors. Restructuring of human resources made the employees aware of what is expected from them daily, weekly, monthly and throughout the year.

The strategic mapping of human resources added strategic value to the company. Lori being the head of Human Resource changed the culture of the company where everyone’s contribution towards achieving the set goals and objectives is appreciated. The strategy map is contained in the Human Resource Scorecard made by the human resource department. The scorecard is a key tool in implementing the Human Resource’s strategic role in organization.

Innovation contributes to the general performance of the company. How innovative the company dictates various aspects of operations. The human resource prides itself of being innovative. HR functions include setting compensation structures and evaluating competitive pay practices. This brings out the integration aspect with other departments; Finance for example. This ensures that complaints from the workers pertaining their compensations are totally eliminated and hence high productivity being realized.

Weaknesses

Revenue generation is a concern for every start-up company. The early strategy for Reyes Fitness Company was revenue generation. In order to generate revenue, they opened up many fitness centers and offered club promotion in order to attract new members. As the time progressed, most of the fitness centers were not meeting their target profit goals. This was caused by customer retention problem. Most of the customers preferred joining only when promotions are being run by the company and or when prices are waived.

Employee’s contributions to the company should be rewarded and recognized. A major challenge to the fitness center was however their inability to recognize their employees. Employees are unaware of their impact and their contribution to the success of the company.

Opportunities

The Fitness center can take advantage of their opportunities to realize much revenue in their market niche. Implementing performance based program is necessary. Employee’s duties and responsibilities are well stipulated but each individual performance is needed. The Human resource focus should be inclined towards measuring the outcomes and not the activities.

Culture and change companion will be enhanced through the incentive program. Every company has cores and values which every employee should adhere to. As time progress, it becomes a culture where the chains of activities are carried out within a stipulated way and manner. The incentive program which ties all the employees in the company is pivotal to the implementation of culture and change by the Human resource.

Engaging with consultancies presents an opportunity to the Reyes Fitness Center. Hiring a business expert to come up with business policies is a good move especially against the competitors while increasing the revenue base for the company. The expertise from the consultancy should be in line with the company strategy to enable streamlining of company’s goals and objectives.

The company should exploit the new technology. The machines being used in their centers should be revolutionized to be in line with the current technology. The mode of operations in the organization in the human resources such as filling and record documentation should be incorporated in to the company database for easier retrieval as and when needed. This however will come with obstacles. “Firms face a number of obstacles when changing from a system of traditional work practices to a system of innovative practices, including: the abandonment of organizational change initiatives after limited policy changes have little effect on performance, the costs of other organizational practices that are needed to make new practices effective, long histories of labor management conflict and mistrust, resistance of supervisors and other workers who might not fare well under the newer practices, and the lack of a supportive institutional and public policy environment” (Ichniowski et al., 1996)

Threats

Hiring employees with great customer service and training skills is a threat due to the nature of rivalry with competitors. While companies strive to maintain their market position in a given niche, well trained employees can be sourced by competitors and offer them a competitive compensation package. This might led to a threat of substitution where a competitor occupies a rival firm target market and completely take over. This might lead to the firm dissolving and in other instances agreeing to be acquired by the rival firm.

Action Plan

To cut down on revenues decline, operational efficiencies should be implemented across all the fitness centers. The Human Resource should work hand in hand with the marketing department to examine each competitor's cost structure, sources of profits, resources and competencies, competitive positioning and product differentiation, degree of vertical integration and historical responses to industry developments. This will form a basis for customer retention which already had been identified as a major concern.

Employees should be rewarded and recognized for the betterment of the organization. Team building workshops aimed at revitalizing and motivating employees should be routinely carried out say after every six months. This will encourage and make them feel valued by the company in its mission of achieving targeted goals.

Implementing performance based program is an opportunity which should be exploited. However, to ensure it is working towards realization of company goals, it should be monitored and evaluated to give progress and how it can be improved.

Evaluation Matrix

The HR scorecard provides a basis for evaluation and implementation of HR’s strategic role in the Reyes Fitness Center. It will reposition the Human Resource into strategic role of the company. The HR Scorecard stresses that the business strategy must be very descriptive so that employees understand their role in the plan and so that they can measure the success of the strategy.

HR can support RFC’s retention strategy by helping to build a team trained and motivated to provide great service to members—and deliver member renewals.

Conclusion

Despite the challenges faced by Reyes Fitness Center, there are many opportunities for growth. The focus of the management to generate more revenue should be in line with the employee’s expectations. As staff develops better customer service skills, member retention will reduce. These opportunities will streamline work of the HR department thus leading to the anticipated growth and collaboration. Some of the weakness in the organization are in-born and are solvable through involvement of all stakeholders including the employees (Mane, 2012).