Strategic Human Resource Management and Competitive Strategy
The performance of the human resources departments can be evaluated using the way the department involves and engages workers in understanding and implementing various aims of an organization. Rather than just handle administrative tasks for employees, effective HR management calls for leadership practice in employee relationships to make sure that workers contribute, believe in, and strive to achieve the organization’s goal. This section of the paper establishes the various incidents of strategic HR management as precursors for evaluating the identified practices, according to theory and best practices. The operating business environment at Innocent is complex. The company successfully moved from being a small business entity with predictable outcomes in its various operations and marketing strategies to become a multinational corporation with different aspects of stakeholder engagement and a colossal number of employees.
Evidence of Strategic Human Resource Management at Innocent
The case study has no illustration of collective bargaining instances, implying that Innocent has no unionized workers. Nevertheless, elements of employees forming groups to challenge or support positions are common in organisations of its scale. It is upon the HR department to handle the issue appropriately. Based on the case study, Innocent has a foundation that enhances the corporate image of the firm and helps to improve its brand association with community development and humane practices. The mention of the Innocent Foundation at this part of the paper is essential because it contributes to the illustration of the next point about employee involvement. Rather than just form the Foundation as a requirement for gaining a competitive threshold, the firm uses the Foundation as an extension of its employee-training program. It does so to cement its values and core beliefs of the employees so that they can embrace citizenship behaviour and support the business in its endeavour to become a global leader in healthy smoothies (Armstrong, 2010).
Rather than consider employees as another cost parameter in the business, the three directors of the company help and continue to hold the belief that the business can only succeed externally after it triumphs over its internal challenges (Michaels, Handfield-Jones & Axelrod, 2001). Thus, Innocent consistently provides training opportunities for employees; in a formal way, as in the case of partner NGO participation, and informally by the employees taking part in management deliberations and decision-making. In the last part, Innocent relies on entrepreneurial activities and thinking of employees to allow them to explore personal abilities and express them for the benefit of the company.
Throughout its history, Innocent aimed to make its employees as the sources of competitive advantage for the business. The practice started with the company’s directors, who signed pacts to remain together, and the senior management staffs, who deliberated every new decision and sponsored it to turn it into practical action in the firm. Delegated decision-making behaviour also contributed to the priorities that the firm had in employing new workers. It relied on five values that prospective employees had to exhibit. They included natural, entrepreneurial, commercial, generous, and responsible behaviour. With these qualities, it is easy to see the purpose that the company places on employees. Employees serve as idea generation resources for Innocent. Resultantly, the firm’s first strategy for managing its HR resources is to get the best employees who align with the company’s objectives, values, and beliefs.
Other than the alignment of values, Innocent also tends to train employees through its induction program. Here, the directors personally inform recruits of Innocent’s values and their desired interpretation. Thus, not only does Innocent train its employees in an academic way, but it also influences their habits, behaviours, and orientations to fit into the existing company culture. It helps the employees behave cohesively and present a uniform outlook of Innocent. It also portrays Innocent as capable of handling its competitive advantage challenges.
Appealing to personal conduct and cultural attributions of employees was an effective way of ensuring that most Innocent employees would still behave according to top leadership expectations, even in situations that lacked absolute guidelines on preferred employees conduct. The company’s induction program facilitated employee participation in decision-making. Consequently, employees could debate with the leaders and question any practices that were new to them. Beyond that, the induction program and the communication of the five value propositions of Innocent serve as examples of top-level communication flow to the bottom of the organization and the reverse way.
The earlier mentioned decision and action support system that required sponsors of ideas and extensive debate on their validity to the firm are examples of think tank behaviour necessary to solve complex organisational problems. The practice is an effective means of recommending solutions and revealing hidden alternatives to agreements with the employees and management when applied to HR management. Employees make the most of their resources to achieve individual and organizational benchmark goals through participation in decision-making. Most importantly, engagement enhances trust in the organization, thereby allowing the employees and management to work cohesively as a unit.
Connecting HR Practices to Competitive Strategy
The competitive environment of Innocent is dynamic. The company has to consider external factors like economic, legal, and political influences in its growth prospects. It must also deal with the competitive forces available in the countries where it operates, with the main ones being the threat of rivals in the industry and the power of substitute products, such as artificially sweetened beverages and alternative natural drinks.
According to the resources based view (RBV) framework, internal resources can be effective sources of a competitive advantage when the management uses them appropriately. One of the resources available to a firm is its employee force. The human resources can be a source of non-imitable capability, thereby allowing a company to achieve results that its rivals may have no idea or capability of copying. It is assumed that a firm’s resources are heterogeneous when using the RVB method. It is also presumed that the resources are not mobile for the firm to remain competitive. Thus, human resources have to be immobile across competing firms to qualify as part of the resources that enabling the firm to achieve competitive advantages within the RBV framework (Scullion & Collings, 2011). Innocent implements several employee programs that ensure its talents remain valuable, rare, non-imitable, and organise to provide long-term distinctive competitive advantages.
In human resources, the skills and knowledge posed by employees are the main drivers of business growth and can offer sustainable competitive advantages. Thus, when looking at Innocent’s competitive advantage position, its human resources should have the ability to create competencies for the business. They have to remain rare and immobile, and then create value. However, they should not be substitutable (Sharma, 2011). At Innocent, human resources add value to the firm. They allow it to manufacture its products and deliver to the market in a timely way, while observing high-quality standards and adhering to consumer expectations, based on the company’s promise. The products from Innocent attract a premium price compared to the competitors’ products. Thus, the role of human resources management at the firm is to ensure that product quality remains high to guarantee premium prices charged at a retail store. The company also relies on the high reputation of its business and brand to sell a large number of products and sustain its growth momentum. Employees contribute to the reputation of the company by sticking to predefined, good conduct, adhering to the company’s code of ethics, and being good brand ambassadors (Silzer & Dowell, 2010). Also, Innocent is selective in the recruitment process when hiring; thus, it can derive maximum value from its human resources at a less expensive cost incurred in changing employee perspectives to align with the company’s perspectives.
The innocent can still fail to acquire competitive advantages, even with enough training and adequate employee culture management. That is where the strategic management of HR comes in to create an element of rarity. The actions of the leaders and administrators at Innocent endeavour to make employee knowledge and conduct strictly limited to Innocent (Glaveli & Karassavidou, 2011). Employees undergo a thorough induction process when joining the company so that they have no reason for leaving. On top of wages and monetary allowances given to the employees, Innocent also provides an avenue for the employees to self-actualize. The workers are encouraged to take part in worthy courses in their communities. They are also challenged to take time off regular work to give their skills to several community organisations that appeal to their values of giving back. Such opportunities are only available at Innocent, and they help to curb talent turnover at the firm. Consequently, Innocent can ensure that its employees are unique when compared to employees of rival companies (Truss, Mankin & Kelliher, 2012). At Innocent, the workers feel like part of the company. Innocent enjoys a favourable mention as one of the best employers in the industry. The main findings here include the fact that Innocent embraces a precise selection of employees and develops job positions that fit various employee capabilities, thereby allowing them to utilize their high-level abilities.
With value-addition and rareness of human resources, Innocent already enjoys a favourable position in its competitive advantage quest. Nevertheless, the company has to do more than hiring the best employees and giving them an attractive working environment to remain competitive over the long term. The two features may make employees love working at Innocent and help to limit the entry of less qualified employees. However, they still fall short of giving Innocent a valid defence against other firms that can copy the same strategy with ease. The healthy Innocent culture of striving for quality and delivering it to customers without compromise is a feature that makes its human resources inimitable. The strong Innocent culture has not only allowed the firm to enjoy a strong and favourable brand reputation, but it has also played a part in limiting employee turnover. It also helps in encouraging the workers to deliver their best in realizing the company’s objectives. As described earlier, the Innocent culture engages employees at multiple decision-making points in the organization. It also gives employees numerous opportunities for personal and professional growth. All these contribute to a strong company tradition that easily assimilates new employees into the closely-knit Innocent community.
An additional source of competitive advantage related to strategic human resource management is wage management. Innocent has a two-tier wage system. In the first case, employees receive monetary compensation as they would expect when working with any firm. Given that the case study does not highlight any employee grievances, this paper concludes that Innocent offers competitive wages. Beyond wages, the second tier of payment comes from the employee fulfilment opportunities that carry a high monetary value equivalent. The company provides workers with opportunities to advance themselves by providing them with both the time and the resources to do so. Otherwise, when left to their means, employees would probably never get opportunities or the time to follow opportunities for growing their connection with their communities and embracing natural and organic principles of living.
Conclusion
In summing up the views highlighted above about Innocent’s use of RBV in strategic HR management to achieve a competitive advantage, this part of the paper concludes with the following views. First, Innocent is in a favourable competitive position because it values employee engagement and has a systematic recruitment process. The management of employees as more than just cost factors has allowed the firm to withstand various business challenges, with the main one being the escape of talent. This part of the paper was organized into two parts. The first part provided evidence of strategic HR management at Innocent, while the second part linked the identified practices with the RBV framework to explain the way each element of HR management at Innocent contributes to the firm’s competitive advantage.
References
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