University of Wales, MBA I. Informative E-mail & II.

A Report on APPRAISAL AND REWARD BASED ON THE GIVEN SITUATION Module Recruitment to Reward (HRM Module) Submitted To: Module Leader: Nuala OSullivan Submitted By: KCB ID: 15272 Date: 8th Sep, 2011

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Table of contents
I. II. Informative E-mail & Case Study Report

Executive Summary Introduction Literature review Methodology Analysis Conclusion Recommendations References Bibliography Internet Sources

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I.

Consultancy E-mail to the CEO of Benkleys, Kamala Balu.

Dear Kamala Balu, Re: Person/Org Fit at Benkleys My hearty appreciations and congratulations to you as CEO of Benkleys and for all the recent successes in the business. It is indeed gladdening to see your company growing and becoming successful in the overseas markets. But in order to achieve a person/organization fit whilst recruiting and selecting staff for Benkleys, please read the following content prepared for your information. Person/Organization fit has been defined in the current literature as the fit between the values of a person and values of the organization. (Robert G. Delcampo.2011, 69) In addition to the person organization fit, it is important to assess the person Job fit which is the fit between the requirements of the Job and the potential of a person. This is important because it decides the result of the person and the firm. If a person who fits well in the organization is selected, then it would result in a committed employee, higher motivational levels, higher job satisfaction, better retention, lower job stress and the overall value of the organization would be uplifted. But there are certain limitations of a person organization fit. When looking for a person-organization fit it may lead to lack of diversity in recruitment, it may discriminate against capable employees and may result in a similar natured employee, which would result in lack of creativity. Therefore, during the recruitment and selection process, various techniques and methods can be used to find individuals who fit the best in the organization. Such fit between the organization and the entire personality of a individual would result in the best outcomes for the person as well as for the company. Selecting a perfect fit for the Recruitment to Reward. 8th Sep, 2011 3

KCB ID 15272 organization would result in good functioning of the organization. Recruitment is defined as those activities directed towards locating potential employees, attracting applications from suitable candidates. (Murphy 2008) Murphy commonly refers it as the attraction phase. During the recruitment procedure, it is our responsibility to attract as many candidates as possible and we must try to know them as much as possible to make the proper decision (Foot and Hook 2011,p.162). Therefore, while advertising for the position, it is advisable to be mindful of the following facts (Araoz ,et al. 2009, p.7478). a) Let the gender preference be neutral. b) (no GOQ for these roles!) c) Provide equal chance to all eligible candidates d) Always bear the legal and ethical norms of the industry and country in mind. e) Let there be clearly defined job criteria when it comes to the marketing managers. Selection is defined as the process of picking the most suitable individual from a vast group of applicants to fill a vacant position. (Delcampo 2011, p.63) And regarding selection, in order to select the right person for the position to be filled, various selection methods can be followed like: a) Aptitude test, personality test, psychometric tests which can reflect various useful abilities of the candidate. To choose an appropriate person for a particular job, the personality tests must be chosen or customized (Foot and Hook 2011). b) Assessment center is another good option to select the right candidate. It includes online tests, personal interviews, individual and group exercises. And to assess you can have a team of people which can include, the managers, CEO and other top management members. (Foot and Hook, 2011, p.179, 218-226 )

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c) Online selection: This mode of selection can be cost effective, easy for the candidates, convenient in administering and time saving as well (Foot and Hook 2011, p.179) Above all care should be taken that the recruitment and selection of a suitable person who fit the organization must be legal complying with anti discrimination legislation. It should be fair on ethical aspect as well. (Delcampo 2011,p.20) Furthermore, I am sure that application of the recommendations made would certainly help to find a person who would fit into the required position and contribute to the growth and performance of the company. Please do contact me for any further clarifications or discussions regarding the recruitment and selection. Kind Regards, KCB ID: 15272 HR Consultant

Recruitment to Reward. 8th Sep, 2011

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II.

A Report on offering options for appraisal and reward based on the given situation for Benkleys, Somerset, England. Executive Summary The report is to the CEO of Benkleys offering the options for appraisal and reward. In this report various literature is reviewed to find various available options of recruitment, selection, reward and appraisal. As the result of the investigation, the report points out that for supervisors the appraisal model or method is by self appraisal or CPD, for office staff the appraisal model is either self appraisal, BSC, BARS or forced model, for marketing manager the appraisal model is either BSC or the 180 degree appraisal method and for the top level which is COO, IT head, CEO the appraisal method is by 360 degree method of appraisal.

The report has also investigated the rewarding aspect for the same employees and it has recommended certain suitable options such as, for the supervisors, the reward method is either tournament theory or total reward model. For office staff, the reward is based on the principal-agent method or PRP or stakeholders theory. For marketing managers, the reward is based on the principal agency or total reward method. And finally for the COO, IT head, CEO, the reward is based on human capital theory which is based on the skill level of the individual and experience.

Introduction
Benkleys is a company, which produces range of jams and preserves in Somerset, 6

KCB ID 15272 England and exports them all over the world. Because of the networking skills of the newly appointed CEO Kamala and her team, the company has been successful in the overseas market and the CFO Harry is quite happy with the revenue generated and but the team has not been given any appraisal. So as a specialist in this area the reporter is recruited to report supported by relevant models to suggest Kamala how she should appraise her team which includes supervisors, office staff, account managers and Eveline and the marketing manager, head of IT and COO. Reward can be defined as a systematic approach to provide either monetary or nonmonetary value to employees in return for their contribution to the business. (Delcampo 2011, p.78 & 83) Performance management is defined as the process of observing, identifying and measuring the performance of an employee in order to manage them and their work. Appraisal can be defined as a regular recording of an assessment of an employees performance, potential and development needs. (Foot and Hook 2011, p.259)

Literature review
According to Cascio, recruitment, selection, performance management, reward and appraisal all these invest in individuals indirectly. Right from the process of job analysis till the person is appraised in an organization, the employee receives a lot of investment from the organization. And so the CEOs and managers involved in these processes should do their best to develop the staff as they focus on the prosperity of the business. (Cascio and Boudreau 2011)

According to George in any firm there would be conflicts in the process of recruitment, selection, performance, reward and appraisal. And to handle all these there should be few changes that should be incorporated. For example this Japnese firm the author is talking about has changed its recruitment strategy from the traditional one to the new web based interview. He says that 94% of more than 5000

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KCB ID 15272 employees have introduced web-based interview. This author talks about MBO systems, which is management by objectives instituted by this Japanese firm. According to this system the employees are managed and monitored by the actual objectives set for them. And the author is proud in mentioning one of the rare feature in organizations. The feature is the smallest gap between the lowest paid and senior executive in the Japanese remuneration system. (Olcott 2009). According to this literature, for an employee to develop their performance and efficiency they should be given benchmarks to achieve within a time frame. This would encourage and motivate other employees to work hard and compete for the bench mark. (Suff R 2010) This author Murphy describes various trends that exist in recruitment methods and gives a detailed understanding of how the recruitment process should start with the job analysis, job advertisements and various other modern techniques to draw as many applicants as possible. These methods though new, would replace the old limitations and benefit the employer as well as the employee to develop and prosper. (Murphy, N. 2008)

Margaret Foot and Caroline Hook have dealt with all the major issues and concepts that are considered much significant in the field of recruiting, selecting, managing , rewarding and appraising. The author moves further deep and mentions that the aim of recruitment should be legal and should follow the anti discrimination legislation. Then he talks about job advertisement and ways of attracting as many candidates as possible. Standing out from the other authors, he has mentioned that a good appraisal interview should be in place to appraise employees. (Foot and Hook 2011)

According to Patrick M.Wright and other authors, in order to improve the performance of employees the managers should make things happen and also change

KCB ID 15272 the style of work. Not only that but the concept of partnering horizon. (Wright et al. 2011) According to Robert, the foremost step in establishing a recruiting plan is by using the knowledge obtained from the job analysis process. The author talks about the regression analysis, ratio analysis and judgmental methods such as top-down or bottom- up. He says that analyses are very valuable approach to determine employee demand. Markov analysis can be used to determine the capacity, reliability and availability of a particular skill or skill set. (Delcampo 2011) According to this author, the performance of an employee can be developed only when the mangers contribute to the survival and advancement of their employees using the relational network. This author discusses on network theory which deals with the mutual dependence between agents in network. (Teisman, et al 2009)This networking would actually help in the international market.

Methodology
a) Fruit picking supervisors In case of recruitment of supervisors, Benkleys should do a job analysis process and determine the number of supervisors needed based on the future performance. And then the Markov analysis can be used to determine the capacity, reliability and availability of a particular skill or skill set required for a supervisor. (Delcampo 2011, p.62) The job should be marketed in a way that it draws maximum skilled applications. Then to choose the most qualified supervisor, the company can use direct interview added with personality tests to access the behavior of the candidate. (Burke, R & Cooper, C 2010) Then, in order to reward them, they can be meticulously observed and given both monetary and non monetary rewards for their performance. Since the supervisors range from 19 year old Ethan to 66 years old Amelie, the company should be aware of the anti discrimination legislation and should reward and appraise

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KCB ID 15272 avoiding any kind of discrimination. b) Office staff, account managers & Eveline For recruiting office staff, accounts managers and Eveline the job analysis should be followed by a well designed plan to recruit the most efficient candidate. (Delcampo 2011, p.49-51) The advertisement should attract as many applicants as possible and then the selection method can use the recent technological methods like telephone interview, web based online test for assessing the behavior etc. This would filter the inefficient applications and make the job simple and easy for selecting the appropriate candidate. Then after selecting, they can be rewarded based on Principal Agency method. And appraise based on the BSC model. c) Marketing Manager The methods that can be used to recruit marketing managers would be based on the skill level to handle the employees under them. So the job analysis and the advertisement should attract people who actually possess those skills required by Benkleys. And the company can use E-recruitment for the preliminary rounds and then use the assessment centers which uses the multi method testing and also being time efficient. And for this post the company can capitalize on the genuine occupational qualification which a degree in management and experience in the same field. And the legislation and ethical errors should be avoided. There should not be any discrimination based on age, sex etc. And then the selected candidates can be rewarded based on the principal agency model, which is to make the managers interested and involved in the profit of the company and work for the interest of the shareholders. (White & Drucker, 2009) This group of employees can be apprised by BSC model, which is balanced scorecard. Under this the performance of the managers are assessed under four factors such as external perspective(how the customers see the company), internal perspective (what must the company excel at), innovation and learning perspective(how can the

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KCB ID 15272 company improve and create value) and financial factor (how can the shareholders be served). (White & Drucker, 2009)

d) COO & head of IT and Kamala Balu(CEO) This is the top level in any company and these top level employees are the ones who deal with the major decisions of the company. These people are recruited and selected mainly based on their experience and skill level. And when it comes to rewarding this group, it is the human capital theory which comes into play. And for appraising, its the 360 degree appraisal method which involves review from employees of all levels and also the customers and suppliers. Since it is the opinion of a huge group related to the company, the information and the evaluation is reliable. (Armstrong, 2008)

Analysis
In general, the way people are rewarded and appraised for their work affects the profit of the company and also affects its market. Reward is not only an expense but it is used by the managers to impact employees attitude and work on the performance of the company. (Price A 2007, P.467) Using the Principal Agent theory to reward office staff and accounts managers is a good option with all its advantages. The communication between the principal and the agent results in informational and expertise advantage that does contribute to the profit of the company. (Armstrong 2002, p.5-10) For example if the reporter (principal) hire a driver(a agent), the reporter can always

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KCB ID 15272 have a look at his work and monitor. But if the reporter hires a doctor, the reporter cannot monitor his effort and sincerity. Because the reporter has not studied medical science. For example if a manger is appointed in a firm, mostly the managers and office staff do not work for the benefit of the shareholders. So either a monitoring system should be designed or incentive system should be introduced which will make the managers and office staff work in the interest of the shareholders. Since most of the time the agents do not get completely interested in the principal, there is loss of efficiency and profit. So, the firm can introduce incentives and bonus to reward the office staff, managers and other employees in a way that they get interested in the profit of the company. The office staff, managers and people like Eveline should be encouraged by the company to buy the company shares through the saving schemes and other schemes that would add benefits to them. This would make them gain interest in the profit of the company. Managers should be given interest in profit by linking part of their income directly to the organizations profit. It could be a part of the profit from last years profit given to the manager as bonus etc. Considering the appraisal of the COO, IT Head and the CEO, the appraisal method that can be used would be the 360 degree appraisal method. Since this model uses the review of the entire employee group from all levels in the organization and in many cases the suppliers and customers are also involved in the assessment process. Just because of this it is considered anonymous and reliable to trust. For example let us consider the Colgate Toothpaste Company, as a part of the appraisal activity, the employees at all levels of the organization are given a short, specific informative questionnaire that could be filled in just 5-10 minutes. And these questionnaires are distributed even to the customers who buy Colgate in whole sale(bulk) and also the suppliers who supply all kinds of raw materials are given the questionnaire. These questionnaires help the employees and others related to Colgate review the function of the top management employees of Colgate. And then later the responsible committee collects the filled in questionnaires and analyses and concludes.

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KCB ID 15272 Since the entire organization was involved, it is called as the 360 degree appraisal method or model.

Regarding the appraisal of the marketing managers This group of employees can be appraised by BSC model which is balanced scorecard. Under this the performance of the managers are assessed under four factors explained below: For instance, let us consider the Body shop. In a Body shop, the performance of the managers are assessed by requesting customers to fill in a small form with checks to be filled in which describes their opinion about the manager. This is the external perspective and then after analyzing those forms, the factors the company must excel at is decided. This is the internal perspective. And then based on the filled in forms the Body shop has to plan and strategize on how to create value for its product and finally the concern is about improving the value of the shareholders. All these steps would indirectly reveal the performance of the managers. (White & Drucker, 2009)

Legal and Ethical Concern: In any company, the recruitment, selection, reward and appraisal are subjected to the law of the land. The individuals involved with the decision making of a company should always understand the legal environment and should take the right ethical decisions as well. (Delcampo 2011, p.16) During the recruitment, selection, reward and appraisal, the company should be aware of the public relations issues that may affect the business of the company financially and reputation wise. Any decision made in Benkleys should comply with the law and company should

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KCB ID 15272 maintain its ethical standard. Some of the issues related to legal environment include issues of the ideal behavior versus affirmative action hiring practices. (Delcampo 2011, p.17) employees should be hired without taking notice of race, ethnicity or gender. The company should always be updated regarding the legislation on the anti discrimination laws, equal pay act and age discrimination act and equal employment opportunity. (Delcampo 2011, p.20-23)

Conclusion
Since Benkleys had a good profit by the networking skills of the CEO Kamala, the company has a plan to extend its business to the overseas market and to achieve it the company really needs to enhance the existing work force and also employee other efficient workers at all levels to meet the demand of the international market. And this report in a nutshell describes and recommends various suggestions based on various theories and methods to retain the current employees by appraising them and rewarding them based on various proven models and methods. Therefore, the reporter conclusively states that if the CEO Kamala Balu would consider the various options of rewarding and appraising mentioned above and the recommendations below, the employees at different levels would be happy and satisfied.

Recommendations
In order to improve the role in the market, Benkleys is given the following recommendations: 1. For recruiting the organization should make use of the modern technologies and

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KCB ID 15272 modern ways of attracting as many applicants as possible. It can use the web applications, web based preliminary rounds using one to one interview on Skype etc. to avoid the wastage of time. This should be implemented by the human resource department in the company or the responsible management staff.

2. For selection, the organization can use telephonic and skpe interviews which are economical for the preliminary rounds and then directly go for a situational interview which would project the true facts about the candidate. And when selecting, the organization should be aware of the anti discrimination laws and should comply with those. Should never discriminate candidates based on gender, age, race, religion and region etc. but positive discrimination such as for being an account manager, the candidate should be a qualified accountant. This recommendation also should be implemented by either the human resource manager or else the management official in-charge of the selection process. 3. Regarding Performance, the company should have its own system to observe, measure and validate the performance of every employee. Benkleys can have a team of few people who have experience in management and these monitors can be divided for different groups like one for supervisors, one for fruit pickers, one for office staffs, managers. These people can use the cameras kept in the organization at the work places to monitor and give the feedback. In order to improve the performance, the organization should build the trust with the employees. Performance can be made effective and more productive by setting up quarterly realistic goals, setting rewards for good results and thus motivating everyone to get to those objectives. This would improve the performance. (Armstrong 2011, 101) In order to improve the performance, the company can organize training and development programs and improve the efficiency of the output. 4. Appraisal For supervisors, self appraisal is the best way to get the maximum out of the work because by this method of appraisal, they would end up being much

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KCB ID 15272 confident in their job and also encourage the fruit pickers to perform their best to be rewarded the best. For office staff, account managers and Eveline, BSC(Balanced Score Card) is the best method to appraise because it results in the wanted attitude, this method gives feedback and learning system. This method results in more open channels for communication and it has the competitive advantage of very less time-frames, best solutions and advanced processes. (Armstrong, 2011, p.133) For marketing managers the appraisal can be based on BARS which is behaviorally anchored rating scales. This suits the managers because their attitude influences the people working under them and also the profit of the firm. They should be regularly monitored for their attitude to their peers, officials and juniors. (Armstrong, 2011, p.134) For COO and IT head and Kamala they can be appraised by using the 360 degree appraisal method. Since it comes from the feedback of employees at all levels and at times also from suppliers and customers, they are very objective and reliable to trust. Therefore, the top managers like Kamala and Marek Novak can be appraised by this method. But there is a risk of time consumption and risk of confidentiality.

5. Reward is an important aspect to be considered to help the organization improve and be successful. In the case of Benkleys, Performance related pay and payment by results are two very good methods to improve the efficiency of the company. PRP method of reward makes it so clear and easy to follow the actual goal set and the task remains very clear and employees put in their whole effort to get the reward. (Armstrong, 2011, p.133-134) PRP method motivates others those who are not working to their full potential. It retains the high performers. It communicates strong message to all and it complies with all ER awareness It is quite ethical to reward the best performers by this method. 16

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For rewarding supervisors, tournament theory and total reward can be used. The reporter has chosen this method to reward supervisors because according to this method, those who succeed in their work are rewarded or else they are not rewarded. It is just like a sports tournament in which the reward is given only when the individual wins or accomplishes the set goal or task. Rewarding office staff it is the principal- agency or PRP or the stakeholders theory that can be used. And the office staff can be appraised by self-appraisal method or BSC which balanced score card or BARS which is behaviorally anchored rating scales and even forced appraisal would be applicable for this group of employees. For Rewarding Marketing Managers either total reward or principal agency can be used because it deals with relational aspect with the supervisors and the employees. Since total reward is transactional meaning it is touchable physical rewards and it is also relational in ways such as training and upgrading the employees. For Rewarding COO and IT head and CEO human capital theory can be used because it is based on the investment model in which the employer justifies cost with skill level acquired. When the skill level increases, the pay also increases. Most of the appraisal and reward methods should be implemented by either the line managers or by the IT head or the COO.

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Bibliography
Armstrong, Michael., 2008. Strategic human resource management. 4th ed. UK: Kopen page Limited. Armstrong, Michael., 2002. Employee Reward. 3rd ed. UK: CIPD. Armstrong, Michael., 2011. How to manage people. 3rd ed. UK: CIPD. Cascio, Wayne., and John Boudreau., 2011. Investing in People. 2nd ed. New Jersey: Pearson Education. Delcampo, Robert G., 2011. Human Resource Management- Demystified. New York: McGraw-Hill. Foot, Margaret., and Caroline Hook., 2011. Introducing HRM. 6th ed. England: Pearson Education Limited. Grimshaw, Ed., 2009. The perfect fit, advanced skills for finding and hiring the Ideal candidate. UK: Dragon rising publishing. Olcott, George., 2009. Conflict and Change: Foreign Ownership and the Japanese Firm. Cambridge: Cambridge University. Price, A., 2007. HRM in a business Context. 3rd ed. Singapore: Thomson Learning. Teisman, Geert., Arwin Van Buuren and Lasse Gerrits., 2009. Managing complex governance system. New York: Routledge. Ulrich, D., & Ulrich, W., 2010. The why of Work. New York: McGraw-Hill. Wright, Patrick. M., John W. Boudreau and others., 2011. The chief HR officer. CA: Jossey-Bass.

Journal: Fernandez-Araoz,c., B. Groysberg and N.Nohria.,2009. The definitive guide to recruiting in good times and bad. Harvard Business Review, May, 74-78.

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KCB ID 15272 Murphy, N., 2008. Trends in recruitment methods in 2006 n 7(1): attraction, IRS employment review 893, 20/03(xperthr.co.uk) Suff, R., 2010. Benchmarking competencies: The 2010 IRS Survey, IRS Employemnt Review, 23.08. Internet Sources Details on rewards and appraisal. Available at: <http://www.cipd.co.uk/NR/rdonlyres/01F95685-76C9-4C96-B2913D5CD4DE1BE5/0/9781843982579_sc.pdf> [Accessed on 3rd Sep, 2011]. Details on Recruitment-and-Selection. Available at: http://www.scribd.com/doc/62834911/4/Definition-of-Recruitment-and-Selection [Accessed on 3rd Sep, 2011]. Details on Recruitment-and-Selection. Available at: <http://www.cipd.co.uk/NR/rdonlyres/01F95685-76C9-4C96-B2913D5CD4DE1BE5/0/9781843982579_sc.pdf> [Accessed on 4th Sep, 2011]

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