Posted at 12.30.2018
Mattel, the world's greatest toy company, designs, makes, markets, and distributes a multitude of toys and video games in 150 countries. The business founded in 1945 by Elliot and Ruth Handler has developed its size, products and labor force within the last 60 years. By 1999 the company was No. 1 in the toy industry. The CEO Jill Barad's growth-by-acquisition strategy has resulted in heavy losses. Robert Eckert, who replaced Barad in May 2000, has chose against an expense cutting technique to increase profits. The business now seems targeted in achieving its proper goals through its labor force management. In this posting, I would like to discuss the main element elements of the Mattel's HRM strategy, its evaluation with regards to the ideas and models and the existing external environment and lastly the issues the company is facing in balancing the organisational HRM strategy and its divisions.
Before Eckert, Mattel does not seem to obtain any formal HRM strategy, however, under Eckert the HR techniques developed and flourished enormously.
Employees Training Performance Management Succession Planning
The idea behind this is to wthhold the home grown ability enabling them to make proper decisions to quickly and effectively respond to the changing conditions.
Evaluation of the Mattel's HRM Strategy with Reference to Theories and Models
There will vary models and theories of HRM strategy upon which companies rely in order make best use of its employees. Mattel does not seem to look at any particular model or theory; somewhat it appears to took a strategic approach to switch the ailing company to income. To be able to critically analyse Mattel's HR strategy it is necessary to consider the idea of HR strategy, its models and its theories.
Mattel's HRM strategy appears to be issue based as opposed to the formulation of a complete and involved strategy (Grundy 1998; Hall and Torrington 1998). Mattel perceived changes in the surroundings, developed a resultant strategy and transform this strategy into action. It is true that, because of the volatile dynamics of market, it was difficult for the Mattel to formulate a single HR strategy and purely abide by it as Mintzberg (1994) argues that strategy is 'formed' alternatively than 'formulated'.
Michigan Institution (Fomburn et al 1984) say that the HR systems and the organisation composition should be handled in a manner that is congruent with the organisational strategy. They claim that the human reference cycle includes universal process i. e. selection, appraisal, rewards and development.
This shows that the overall HR strategy is derived from the business enterprise strategy and creates specific HR strategies in key areas. This happens together with organized reviews of the internal and external environment of the organization which identify the business, organizational and HR conditions that have to be dealt with (Milmore et al (2007).
According to Torrington & Hall (2002), there are three theoretical methods to the proper HRM;
Universalistic Approach - suggests that there exists 'one best way' of managing the human resources to enhance the business performance.
Contingency theory - deals with the partnership of the guidelines and strategies with the circumstances of the company. It really is essentially about the necessity to achieve fit between the actual organisation is and what it wishes to be.
Resource Based approach - targets the grade of the human resources open to the organisation and their capability to learn and conform quicker than their opponents.
In the light of the aforementioned models and ideas, Mattel does not seem to obtain adopted a particular model or a theory. However, as per the case study it could be suggested that Mattel has followed the resource established methodology and a linear model for its success because it focused on the available human resource and resolved the HR issues it was lacked. Mattel has rightly comprehended the importance of its workforce and needed the strategic steps to save its entity. Heavy investment in neuro-scientific employees training suggests that Eckert appears to have taken a conservative approach towards having the business to its status quo. Initiatives were taken in order to defeat the then challenges. However, not surprisingly, Mattel does not understand the HR planning that involves right people in right jobs and at right costs. One essential requirement of planning is to truly have a organized recruitment of employees. For recruiting, Mattel didn't adopt a structured way for recruitment and selection. Effective management of recruitment could have reduced risk and uncertainty by acquiring the best people using systems within the organisation to match capacities and market requirements. In doing so, Mattel could have considered the cost issue which will need to have been justified with the pressures of the business environment. Though, abnormal spending on development programs is good idea, it might not always bring the mandatory results as just focusing on the current employees may lead Mattel lose the fresh talent.
It has also been observed that Mattel has not taken into account balanced procedure between earning gains and developing its employees. The business has not made the required profits within the first 2 yrs yet spending on development programs was increased. It doubtless that that individual source is the major property (Armstrong 2006) for an organization but there's also other issues which need concerns i. e. market environment, achieving established goals and acquiring new businesses.
Organisations respond in a different way (Edward & Rees 2006) to the changing circumstances in highly competitive world and especially in this economic downturn; it is becoming extremely hard for most of the organisations to make it through solely by bettering its work force. In the difficult times, organizations generally choose the cost-cutting strategy (Torrington and Hall 2002) to be able to meet up with the changes and maintain themselves. However, Mattel under Eckert appears to have taken a conventional procedure as it discerned a cost-cutting strategy is not always suitable since it may bring about dropping the services of best people the company retains. Therefore Eckert decided to develop the visitors to an extent that they have the capability to beat the marketplace challenges so that the company may run smoothly and generate good revenue on permanent basis.
Mattel workforce management against the cost-cutting strategy has been successful. It is noticed that while producing and taking care of the labor force Mattel's will not appears to have taken into account the competition from the large competition e. g. Hasbro which includes defeated Mattel in the past and could repeat.
The issues Mattel is now facing in managing the organisational HRM strategy with its divisions are as none of them of the models seemed to work in obtaining a standard goal for Mattel. The business is facing the problem of divisional autonomy. The company is not against the thought of individual personalization keeping in view the political, financial, social and technical factors of countries in which they operate. Nevertheless the real issue is to what extent autonomy should get in order to attain integration between commercial and divisional HR strategies. In these circumstances neither a complete separation of capabilities nor a good central control would be appropriate rather a balance between the two would be appreciable.
According to Armstrong, all international organizations are facing the degree to which their HR procedures should converge (worldwide fundamentally to be the same in each location) or diverge (to be differentiated in response to the local requirements). Laurent (1986) commented that multinational organisations need to struggle consistently in taking care of people on an internationally basis in order to construct, maintain and develop the organization id. Yet, and in order to be effective locally, they also need to look at those ways to the precise ethnic requirements of different societies.
The cultural dissimilarities have produced a slogan "think globally and respond locally" and Mattel should respond on that basic principle while managing the powers using its divisions. This implies an international balancing work (Bartlett and Ghoshall 1991) is required which will lead Mattel to managing coordination, control and autonomy that are critical to its success.
Mattel has succeeded in its workforce technique to bring the business to profits so far. Through its employees training, performance management and succession planning, the company not only developed tactical workforce but also arranged a base because of its better future and presence on the world for a longer period. However, to be able to keep up a reliability in its development all together, Mattel must show more determination and strategic strategy towards turbulent global market. The existing global recession has not only forced the firms to lessen their labor force but also forced these to close down their businesses or combine in to the others e. g. HBOS and Halifax.
The survival and growth of a small business (Tyson, 2006) is dependent upon the grade of the human reference within the business as well as how well they perform. Performing well is insufficient for a multinational business; management of this performance is also needed. Through an effective performance management system the employees are assessed what they did already and what is needed to be done. In Mattel, Eckert has also presented some changes for the marketing of its workforce and retain the home grown skill. Below is critical evaluation of the Mattel's performance management and the ways in which Mattel could ensure the sustainability of its performance management.
Performance management (Armstrong, 2006) is a systematic process for improving the performance of people and teams. It is a means of getting greater results by understanding and managing performance within an agreed framework of designed goals and competency requirements. It really is basically about what to accomplish and in what time to attain.
When Eckert took over there was no single performance management system. Employees only knew what they independently have to accomplish but knew nothing at all what Mattel wished to secure as an organization. Eckert helped bring some changes in the performance management where a one performance management system was devised for all the divisions. Performance of the employees was measured and the performance management was unveiled to the employees across the world. Supervisors received a set of objectives which recognized the corporate goals. Through a 360-degree feedback system, employees came up to learn how well they may be performing. Individual coaching led the employees to improve using arrears.
These changes were quite definitely reasonable in a company especially without the performance management system. However, it appears that some issues have never been considered at all while producing the performance management system. For instance employees reward system and the performance rating is lacking. Although a succession planning was setup to promote those who experienced the potential management qualities, yet promotions in bigger organizations do not happen so frequently somewhat it take years. If employees are given quick and realistic reward for their accomplishments they not only feel pleased to succeed but also look at what they are adding to the success of the organization goals (Gilmore & Williams 2009).
Employees' performance score was not put in place which is also useful in managing the performance of the employees. ---to sum up judgments about people indicating who are the exceptional performers, the under performers and who are the core performers so the action can be taken. Good performance rating i. e. exceptional, well balance, appropriate and unacceptable performance not only motivates the employees but also helps them know how well they are performing.
In addition compared to that Mattel must work more vigorously towards aligning the average person targets to the organizational targets by establishing a higher performance culture and ensuring that individuals uphold the organization values.
According to Armstrong World Establishments performance management is empowering, motivating and satisfying the employees to do their finest and in view of Fli Lily & co performance management is actually focusing employees process on the right things and doing them right and aligning the individual's goals with the organizational ones.
In the light of all these illustrations, Mattel need to consider providing discretion to the employees allowing them to work how they like in order that they feel absolve to innovate new products and use new ideas. Purcell and his team at the Shower University, university of management (2003) state that discretionary behaviour refers to choices that individuals make about how they perform their work which leads the people to make extra work and worry towards development and productivity.
Mattel also needs to have a powerful performance planning where the employees should improve the performance and develop the required competence. Furthermore Mattel should encourage the employees to make a personal development plan and ensure that plan is updated on regular basis.
The basic idea behind Mattel's performance management is to permit every person to react to the changing circumstances and make instant and better decisions if the need occurs. Through this the company also ensures that any future loss of experienced employees would be compensated without any wait from the skilled workforce in queue.
In order to sustain the performance management for a longer time Mattel must establish a powerful and formal review insurance plan i. e. once or twice in a calendar year. As performance management is a continuous process, it requires to be reviewed properly. Use of praise may possibly also assist in sustaining the powerful management culture.
For the performance management system to work, Mattel must take note of several factors i. e. its size, market sensitivity and a good linkage between performance and rewards.