The Role of Human Resource

In Management of Business

How Culture Reinforces Business Strategy at Marriott

J.W. Marriott's vision for the company is to be the worlds lodging leader.

Focus on 3 key areas:
1. Customer Service
2. Developing a high leveled and diverse workforce.
3. Extensive Operational Knowledge

Spirit to Serve Culture @ The Marriott

Emphasizes the importance of the organizations associates and their value.

Focus on executing fundamental ideas of service to their associates, customers and the community.

1. Unshakeable conviction that their people are their most important asset.
2. A home environment with friendly workplace relationships.
3. A performance reward system that recognizes the important contributions of hourly and management associates.
4. A associate growth and personal development environment.
5. Caring reputation for employing dependable, ethical and trustworthy associates.
6. Openness to innovation and creativity.

The following video is a portion of how The Marriott President/CEO Arne Sorenson

You Have Permission to Innovate @ Marriott International

You Have Permission to Innovate @ Marriott International

Market Value of Companies that utilize HRM Best Practices

1. Selective Recruiting
2. Training
3. Employment Security

The Market Value of Companies that use HRM best practice are 50% higher than organizations that do not.

Why Is Organizational Culture Important? 4 Broad Types of Organizational Culture:

1. Entrepreneurial - Highlights creativity, innovation and risk.

Below a Video Example of IDEO Innovation

2. Bureaucratic - Formal structures and precise implementation of organizational procedures, norms and rules.

Below is an example of GlaxoSmithKline's Bureaucratic structure.
GlaxoSmithKline is an interesting example of a company that has addressed the level of authority. Prior to their merger in 2000, Glaxo Welcome and SmithKline Beecham had monolithic Discovery and Development organizations. With the formation of GlaxoSmithKline, six multi-therapy area groups called Centers of Excellence in Drug Discovery (CEDDs) were created, each with about 500 employees. These groups managed the pipeline from Lead Optimization through Proof of Concept. In 2008 the therapy areas within the CEDDs were realigned and each CEDD was divided into a set of smaller Discovery Performance Units (DPUs), each consisting of roughly 60 persons.1, 2 By 2009 there were 35 DPUs. Each DPU had full control over its own budget which could be spent internally or externally to deliver their best possible pipeline. The goals in each of these moves was to drive accountability deeper into the organization, reduce central oversight as much as necessary and foster a “biotech-like” atmosphere in a very large bio/pharmaceutical company. The jury is still out on the success of GSK’s DPU venture, but the company clearly proved that it was capable of reinventing itself “to be big and small at the same time” (a phrase often used by Tachi Yamada, first head of R&D at GSK).

3. Consensual - Stresses loyalty, tradition and encourages employee longevity.

Promotion comes from within.

Law Firms and The Military are great examples of this wonderful culture.

4. Competitive - Focuses on competitive advantage and market superiority.

Brokerage/Currency Firms are consistent with this culture - which creates an enormous amount of stress.

Performance Culture

Emphasis on hiring, retaining, developing, motivating, and creating work task based upon performance data/results.

AFLAC Culture Video

Nokia’s New Chief Faces Culture of Complacency By KEVIN J. O’BRIENSEPT. 26, 2010


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Credit Minh Uong/The New York Times





A few years before Apple introduced the iPhone, research engineers at Nokia prepared a prototype of an Internet-ready, touch-screen handset with a large display, which they thought could give the company a powerful advantage in the fast-growing smartphone market.

The prototype was demonstrated to business customers at Nokia’s headquarters in Finland as an example of what was in the company’s pipeline, according to a former employee who made the 2004 presentation in Espoo.

But management worried that the product could be a costly flop, said the former employee, Ari Hakkarainen, a manager responsible for marketing on the development team for the Nokia Series 60, then the company’s premium line of smartphones. Nokia did not pursue development, he said.

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“It was very early days, and no one really knew anything about the touch screen’s potential,” Mr. Hakkarainen explained. “And it was an expensive device to produce, so there was more risk involved for Nokia. So management did the usual. They killed it.”

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As chief, Stephen Elop must regain Nokia’s lost ground in smartphones. Credit Tomi Setala/Bloomberg News

As Nokia’s new chief executive, Stephen Elop, takes over this month, he faces a formidable task: to regain the company’s lost ground in the smartphone segment of the global phone market, especially in the United States, while maintaining its worldwide dominance as the largest maker of mobile phones.

His biggest obstacle, according to Mr. Hakkarainen, as well as two other former employees and industry analysts, may well be Nokia’s stifling bureaucratic culture. In interviews, Mr. Hakkarainen and the other former employees depicted an organization so swollen by its early success that it grew complacent, slow and removed from consumer desires. As a result, they said, Nokia lost the lead in several crucial areas by failing to fast-track its designs for touch screens, software applications and 3-D interfaces.

In 2004, one said, the company rejected an early design for a Nokia online applications store — an innovation that Apple, Nokia and other handset makers adopted three years later. Nokia also did not improve its Symbian operating system, needed to support a more sophisticated smartphone. And though it introduced the industry’s first touch-screen devices in 2003 — the 6108 and 3108 phones, which worked with a stylus — it did not perfect the technology to fingertip precision before Apple did.

Nokia still lacks a convincing response to the iPhone. Last week it announced that software errors would delay shipments of its long-awaited N8 touch-screen phone.

A Nokia spokeswoman, Arja Suominen, declined to address any specific criticisms by the three former employees, playing down their roles. They were, she said, “managers with individual roles or leaders of small teams.”

She also said that Mr. Elop, 46, a Canadian who had run Microsoft’s business software division, and the first non-Finnish chief executive, would not give interviews yet. He began work on Sept. 21, and is spending his first weeks meeting with Nokia employees, suppliers, phone operators and software developers.


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“I am sure there are things we could have done better and innovations we missed,” Ms. Suominen added. “But that happens to all companies. We have been very successful with some other innovations.”

She cited Nokia’s large patent portfolio and its 770 Internet Tablet, a compact, flat-screen device without a phone, released in 2005. It worked with a pen stylus and was made for Internet browsing but is no longer sold.

Henry Tirri, who leads Nokia’s long-term research unit, mentioned the development of Chinese character recognition, a social networking service for India and software that makes panoramic photos from a series of images. None have been matched by rivals, he said. But none have been game changers, as the iPhone was.

Mr. Tirri, whose unit has about 600 employees at 12 sites worldwide, said the company was trying to change its culture. “We have made a real effort to transform and open the research channels” since 2004, he said.

As of June, Nokia controlled 40.3 percent of the worldwide market for mobile phones, down from 40.7 percent a year earlier, according to Strategy Analytics, a research firm. That global share has remained relatively constant over the last decade.

But in the United States, its share has slipped from 35 percent in March 2002 to 8.1 percent in April, according to comScore, a provider of digital market intelligence based in Reston, Va. It has offset the decline in the United States, with growth in China, Asia and elsewhere.


The decline in the United States is mostly because of the rise of the smartphone competitors, like Apple, Research in Motion and Samsung. And the biggest profits are attributable to the most advanced devices.

Apple delivers consistently higher profit margins than Nokia.

Still, Nokia is on track this year to sell more than 70 million smartphones worldwide; Apple sold 33 million iPhones in the year through June 26.

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What is the Role of HRM in High Performance Work Systems

HPWS - are known as high involvement/high commitment organizations which enables high performance through their employees.

Employees are responsible to complete the task, but also improve work methods and procedures, problem solving and coordination of job responsibilities. Also, employees must be self sufficient and have the capabilities of working alone.

The Book - Human Equation - Author Jeffrey Pfeffer

Seven Elements:
1. Employment security
2. Selective new talent hiring
3. Self managed teams
4. Comparable high compensation
5. Thorough training
6. Reduced status distinctions/barriers - dress, language, office arrangements wage differences
7. Extensive sharing of financial/performance information throughout the company

Review chart at the top of page 41.

The Role of HRM in Corporate Ethics and Social Responsibility

Ethics - Standards of moral behavior that define socially accepted behaviors that are right as opposed to wrong.

5 types of ethical standards:
1. Utilitarian Standard - ethical action best balances good over harm - the most good or the less harm.

2, Rights Standard - one that best respects and protects the moral rights of everyone involved.

3. Fairness Standard - all people are treated equally, or at least fairly based upon defensible standards.

4. Common Good Standard - showing respect and compassion for everyone, especially the most vulnerable.

5. Virtue Standard - being consistent with certain ideal virtues including civility, compassion and benevolence.

Review the chart at the top of page 42 - A Formula for Ethical Behavior

In-Class Assignment
1. Each group research a company with historical unethical behavior.
2. Each group research a company with good ethical standards.

Three types of systematic errors organizations make which undermines ethic efforts.

1. Omission errors - A lack of written rules

2. Remission errors- Pressure to make unethical choices

3. Commission errors - Failure to follow sound, established operational and ethical practices.

Review Survey at the top of page 43 - Why Employees Act Unethically

Benefits from Managing Corporate Ethics

1. Promoting strong public images
2. Substantially improving society
3. Managing change
4. Cultivating teamwork/productivity
5. Supporting employee growth
6. Ensure policies are legal
7. Avoid criminal acts on the behalf of employees
8. Manage employee values - associated with quality, strategic planning, diversity

Review Chart at the top of page 44 - Common Ethical Issues in HRM

Code of Conduct

Specifies expected and prohibited actions in the workplace and give examples of inappropriate behavior.

Code of Ethics

Decision making guide that identifies the highest values the organization wishes to inspire.

Review Chart on top of page 45 - How HRM Can Support Corporate Ethics

In-Class Assignment - Deepwater Horizon Explosion - Page 45

Corporate Social Responsibility

When organizations show concern for common good and value human dignity.

Stakeholder Perspective

When the interest of ALL peoples, groups, organizations or systems are considered, which affect our could affect the organizations success.

International Organization for Standardization - ISO

The world's largest developer/publisher of international standards - created a variety of standards that assist organizations to meet their environmental and social responsibility objectives.

Review chart at the bottome of page 47 - Examples of Socially Responsible HRM Practices

7 Ways HRM Can Support Organizational Change

1. Change of new organizational culture
2. Installment of new employee behaviors
3. New production process
4. Grand opening of new location
5. Rolling out new benefit programs
6. Implementing new HRIS system or upgrade current system
7. Expand international operations.

HRM during Mergers/Acquisitions

As many as 85% of mergers fail to accomplish their objectives.

Culture differences - Daimler/Chrysler Merger

In-Class Group Assignment - Research Daimler/Chrysler Merger

Effective talent planning is important to success of a merger/acquisition.

HRM Metrics

Metrics/Measurements are important when identifying where the organizations HRM system can be improved as well as meeting the needs of their stakeholders/employees.

Review chart on top of page 53 - Common HRM Metrics

Next Week - Each group with share the fictitous organizations of their choice