Internal Management Policies And HR Welfare In H&M

The Evolution of Fashion Industry and Its Global Impact

Question:

Discuss about the Effective Management and Case Analysis of H&M.

The changes in the trends of the global structure due to the globalization that the world faces, fashion too have faced the same. The fashion industry has developed depending on the needs and requirements of the consumers globally. People around the world have become increasingly conscious about the upcoming trends (Farid & Cerna de Ramirez, 2013).

The companies have emerged that takes the best effort in satisfying the needs and requirements of the clients globally. People throughout the world have become increasingly conscious about the suitability and the diversity of the fashion trends relating to their choices. Companies like H&M, Zara, Gap Inc. and the like have conquered the market considerably with their share of contribution towards the fashion industry and the evolving and the trends. The report concentrates on H&M and the important aspects of the undertakings of the company based on its model of management and the diversity in the business operation sit undertakes in order to make it a more competitive contender in the market (Giertz-Mårtenson, 2012). Moreover, its policies play an important part in understanding the authenticity of its management system, which is being discussed in the report that follows.

The report aims at understanding the clear concepts of proficient management undertaken by the company. The report also focuses in understanding the policies that the company sets and legislations that it formulates in order to safeguard the interests of the human resource. 

The purpose of this report is to determine the aspects of internal management that the company undertakes in order to safeguard the interests of its shareholders and the workers at large. The company formulates laws and legislation, which helps in the proper management of the company and in determining the long-term goals of the organization. This report gives an overview of the undertakings of the company and helps in determining the condition of the market.

The company undertakes activities that help in improving and innovating fashion for the world. Moreover, it helps in obtaining fashionable wear at an affordable price. The company does not own any factory and therefore it buys its products from different suppliers, coming from the production countries mainly Asia and Europe (Ehrsam, 2016). The company contributes to the national income by creating job opportunities for many people in the nation. It also helps in the development of the industrial sector of the concerned nations. The undertakings of the company relating to the welfare and management of the human resource are being determined by the subsections of this report.

The job ability of the company is based on the effectiveness and the active participation of the workforce. The participation of the workforce is based on the remuneration they receive from the company and the employment retention rate that the company holds for its employees. The H&M group facilitates the requirements of over hundred thousand employees globally, and aims at creating diversity among the groups of its employees. Diversity in the workforce helps in innovating new concepts and ideas that help in maintaining the smooth productivity of the company. Employees are considered as an important and an integral part of the company. The job ability of the company depends on the devices that are framed by the organization and the ways in which the company can keep the employees motivated and get the job done out of them.

he employees and the shareholders in the company are being motivated by the grants that the company enumerates for its better and smooth functioning. The company has a open-door policy through which the employees can directly discuss the work related issues an d convey the messages to their management or the higher authorities (Uriarte Elizaga, 2016). It facilitates a motivation among the employees as the autonomic barrier is being removed and helps in identifying the employees with the functioning of the management. Moreover, the confidence of the employees is elevated due to this policy of the company. This policy also helps in reducing the rumors, which might have a diverse effect on the internal communication system of the company.

The rewards that the company holds for their employees also helps in keeping the workforce motivated. It focuses on rewarding people with most responsibilities and opportunities to improve their individual careers.  There are other remuneration and incentive plans for the workforce that helps in keeping the people focused and motivated in maintaining their respective job role.

The company makes use of the Expectancy theory through which the company aims at keeping the employees motivated and focused. Under this theory, the company exerts high level efforts in order to develop gradually. This performance is monitored through regular review sessions of the performance and constant motivation from the employer’s side. From the employees point of view they gain knowledge under that pressure that the company exerts on them, making them eligible for the desirable designation.

The concerned company takes care of the benefits that the employees desire to derive from the company (Woods, 2017). The company offers comprehensive rewards structure and follows it invariably. The rewards include discounts on commodities, incentives and the sick pay in the private healthcare and the pension schemes. , which the the company provides to every individuals. The company does not consider the titles, the surnames, or the pay structure as the motivational tools in the management of the employees but the job satisfaction that the employees derive after being associated with the company. The company holds a framework of the reward structure of the employees with greater emphasis on the relational awards. There are monetary benefits too that are being ushered by the company on the employees.

The employees have a direct relation with the company based on the remuneration they receive and the service they provide in order to achieve the common goal of the organization (Jin & Cedrola, 2016). The employees fall under the direct legislations and the policies that the company formulates. Moreover, not only the company faces the change in the rate of the demand but also by its employees face the consequences of the profit and the loss incurred by the company. The .open door policy that the company holds ensures a transparency in the organizational structure and the empowerment of the employees.

The safety legislative acts that the company incorporates keeping in mind the welfare of the organization helps in maintaining the employee-employer relation and therefore finally helps in retaining the workforce of the company (Shen, 2014).  The legislative acts that the company incorporates include acts based on the safety of the employees and the perpetual development of the acts. The building safety act refers to the safety challenges that are emphasized on by the suppliers and other business partners ensuring the safety of the employees falling under the category. Hazardous elements and buildings are considered in this act. It ensures the safety of the employees in the context.

The fire safety is a considerable step taken by the organization in order to ensure the safety of the employees. The involvement of the fire fighting devices and emergency exits being marked properly is the basis of good management and precautionary practices that the company undertakes (Li et al., 2014). Evacuation through the emergency exits and regular drills that helps in making the evacuation successful in the crisis hour is an important step that is undertaken by the company in order to make the employees aware of the evacuation procedure. The company also undertakes a first aid campaign and makes use of the steps proactively so that no members of the staff are injured, thereby safeguarding the health of its employees.

Growth and development has been an important factor in this company. The perpetual growth factor in this company motivates the employees in performing their respective job role effectively (Ci, Park & Kim, 2017). Moreover, with the on-going changes in the environment and the changes in the taste and preference pattern of the consumers worldwide, increasing number of people are opting for this sector. Growth in designations and the remunerations that the employee receives from the company is the major factor that influences the employee’s active participation in the functioning of the business.

On the other hand, from a different point of view, the company’s contribution towards the development of the national income is an important aspect that is to be noted. The company undertakes several recruitments that help in the development of the national income of the country and the people to develop their status of living (Campaign, 2015). The sustenance of the indigenous practices undertaken by the company is basically due to the involvement in bringing about the development of the economies. Moreover, the company does not manufacture any goods that they sell. Therefore, the suppliers who supply the goods and commodities to the company also develop along with the advancements of the company. The nations to which the suppliers belong to also are improved due to the transactions that are taken place due to the export of the goods to the company (Turker & Altuntas, 2014).

Remuneration and incentives are not the only appraisal the company has got for its employees. The change in the designation and the gradual growth and detainment of the workforce is the kind of appraisal undertaken by the company. Moreover, in   order to keep the people motivated and focused on their respective job role, the company has undertaken functions and procedures to encourage the employees.

The company has formulated certain disciplinary components that help in the proper management of the organization. Discipline is the key to all successful enterprises; therefore, in order to excel in the market and avoid all sorts of rumors that might affect the brand name of the organization has framed certain laws through which the company might monitor over the disciplinary actions of the employees (Sandybayev & Nicosia, 2015). The company has provided the employees with the ‘Whistle Blowing policy’- a platform where the employees can report of any malpractices referring to bribery or the fraudulent activities in maintaining the accounts of the company, being noticed by them in the work place. The Whistle Blowing Policy buy the company ensures that the company acts according to the legislation, in accordance with the Swedish Personal Data Act.

The section of the report concentrates on the strengths and weaknesses of the concerned organization. The policies of the organization referring to the safety and the security of the employees, the remuneration and the equal employment opportunities can be taken as the considerable strengths of the company.  The company supports the involvement of diversity in its workforce thus making it more creative and innovative at the same time that helps in improving the market condition of the company (Regnér & Yildiz, 2014). The diversity also helps in the emergence of new concepts and ideas as people from different regions come together to form a team and work according to the specializations accordingly.

The weaknesses of the company can be termed due to the mismanagement of the policies and the lack of proper monitoring that led to the violation of one of its policy in Vietnam, according to a report that was filed previously. The company prohibits child labor and restricts the involvement of the children in the workforce. The report stated differently, when the workforce in the company’s Vietnam branch was loaded with children below the age of fourteen (Baldassarre & Campo, 2014). This is a serious setback for the company, affecting the brand name of the organization as the report clearly portrays the mismanagement in the internal structure of the company. Due to the lack of proper monitoring of the activities taking place in the branches, the incident took place.

The company aims at making the fashionables available to market at a comparatively lower price. Maybe this is because the company does not undertake any production, so they can easily skip the cost of production and the cost of the raw materials does not gets involved majorly in their schedule helping them to be the sole distributors of the fashion items to the world (Morgan, 2017). The proper legislative actions that the company undertakes determines the effectiveness of the management it undertakes.

The company has formulated many policies in order to make sure that child labor is restricted, but proper monitoring of the procedure is an important step after implementation (Manzini, 2016). The company should carefully monitor not only child labor, but also the other policies in order to undertake the smooth and effective management procedure. It also helps in the progress of the company by achieving the long-term goals of the organization.

References

Baldassarre, F., & Campo, R. (2014). Child labor and business ethics: The approach of apparel companies. ADVANCES IN BUSINESS MANAGEMENT. Towards Systemic Approach, 154.

Campaign, C. C. (2015). Clean Clothes Campaign response to agreement between H&M and IndustriALL.

Ci, C., Park, S., & Kim, B. (2017, July). DIFFERENCES IN THE BRANDING STRATEGY OF THE BIG 3 SPA BRANDS: ZARA, UNIQLO, AND H&M. In 2017 Global Fashion Management Conference at Vienna (pp. 65-66).

Ehrsam, M. (2016). Is green the new black?: the impact of sustainability on brand: Conscious Fashion, a case study on H&M(Doctoral dissertation).

Farid, B., & Cerna de Ramirez, C. (2013). An analysis of the consumer knowledge, expectations and perspective towards CSR–H&M Sweden.

Giertz-Mårtenson, I. (2012). H&M–documenting the story of one of the world’s largest fashion retailers. Business history, 54(1), 108-115.

Jin, B., & Cedrola, E. (2016). Overview of fashion brand internationalization: theories and trends. In Fashion Brand Internationalization (pp. 1-30). Palgrave Macmillan US.

Li, Y., Zhao, X., Shi, D., & Li, X. (2014). Governance of sustainable supply chains in the fast fashion industry. European Management Journal, 32(5), 823-836.

Manzini, G. (2016). From H&M to Gap for Lightweight BWT Merging. arXiv preprint arXiv:1609.04618.

Morgan, A. (2017). A Chronological literature review of Retail Internationalisation: From the 50’s to the ‘00’s-Towards a perspective of current market inclines in retail internationalisation 2010–2015.

Regnér, P., & Yildiz, H. E. (2014). H&M in Fast Fashion: continued success?.

Sandybayev, A., & Nicosia, N. C. (2015). Competing in Volatile Markets through Analysis of Agile Supply Chain. Case of H&M. Journal of Human and Social Science Research; Vol, 6(02), 059-066.

Shen, B. (2014). Sustainable fashion supply chain: Lessons from H&M. Sustainability, 6(9), 6236-6249.

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Woods, B. I. E. J. (2017). The battle of The Fashion Retail Giants to Capture Millennials: Examples from Boohoo, H&M, New Look, Asos and Primark. Month.