EXECUTIVE SUMMARY
This report was commissioned to check why the Southern Limited company has dropped lately and to recommend solutions to improve the productivity and solve the issues,which have been created.
Southern Foods limited is a food industrial company. It has been developed around 100 countries. The food products of the company have been successful.
However, the case study draws the attention to the main problems. First of all there are not flexible hours for the workers, the productivity is slow during the sickness and holiday period, the staff who covers the sickness and holiday absence is not appropriate trained and some well-trained skills workers are paid with the same wages as low skilled workers are. Furthermore, only the high skilled workers receive rewards and this brings tension in the workplace of the company. The company decided that is not necessary to buy machinery because they can not afford it. Instead of buying the needed machinery, they preferred to increase the working hours.
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Southern Food limited is a food industrial company, which was successful during the past. The report evaluates this range and concludes that it would be very beneficial to the company to develop flexibility techniques in order to improve the productivity and satisfy the workers, since the main issues have been raised are about them. They could also use some ideas to manage the problem between the staff.
Due to the issues, which have been developed, it is recommended that the Southern limited company should use immediately a flexibility firm to minimise issues such as unfair wages for the high skilled workers and limited training.
It is also recommended the adoption of some methods such as meetings with the employees in order to increase their involvement and to prevent trade unions participation.
In order to make the workers, who are not receiving rewards, happy, it is recommended that the company should consider a flexibility to satisfy their needs.
It is also recommended to Southern Foods limited company to use a flexibility method to cover the absences during the sickness and holiday period, which increases the productivity and helps the company to spend less money.
INTRODUCTION
Southern Food limited is a company, which exports savoury and cooperates with food industrial companies around different countries. Southern Food limited is in disadvantage because there is not in place any contract, which will guarantee that they will work with Frankie’s restaurant. Furthermore, Southern Limited Company faces difficulties in order to meet the demands, which Frankie’s has asked.
Thus, the company in order to be able to give quality standards has to improve some existing issues. The company requires the installation of 3 machines, which cost a great amount of money. In addition Frankie’s requested further development and investment from this business.
In order to meet these demands Southern limited Food has to solve the issues within the staff, where the high skilled workers feel they are not paying fair and this is dropping the moral and the employees are commuting less than previously.
The managerial, also, gets the employee cover staff from different areas as it is not permitted within the factory by the law.
The current situation of the company shows that there is a need of extra machinery, but such a purchase is not achievable. The managing director has also decided to increase the working hours and to offer rewards only to high skilled workers and to give only 6 more persons as staff and he changed the working hours. Furthermore, some staff has not received appropriate training levels and is not capable of using the machinery in an effective way, which it brings down the productivity in the Southern Food limited.
Organisations have to be flexible in order to meet the demanding needs. So Southern Food limited will need some flexibility approaches to solve the issues have been raised by the workers. For example high skilled workers are not satisfied with their wages, as they are more dedicated to the company and they are working harder. The director decides to give rewards only to the high skilled workers, which may occur tense in the company and the workers approach the trade unions to solve their issues, as they think that they deserve a reward as well.
This institutional framework will give them some flexibility methods to aid them with workforce size, wages and tasks. These approaches will be developed further below.
ANALYSIS
The Southern Food limited company has as main issues the slow production and the dissatisfaction of the workers due to the inequality of the wages, rewards and the heavy working hours.
The slow production has been occurring mainly during the holidays absence and sickness period but also due to the low-level of trainings among the low skilled workers and the cover staff. A way to improve this, is the functional flexibility.
Atkinson (1985), developed some flexibility strategies,which employers can use in order to increase the organisational flexibility and help the company gain some more advantages. (Kalleberg, 2001).
One of these approaches is the functional flexibility.
Functional flexibility is about the deployment in the different tasks. The jobs are usually designated by the tasks and mostly based on the skills of the workers. ( Wilkinson , Redman, 2013).
Functional flexibility also, when we are emphasizing in labour needs, ensures that the workers are ready to be adaptable and face any difficult challenges, in order to meet company needs (Cordey et all,1993).
When the employers are using this flexibility, they will offer to the employees the opportunity of further development on their skills, not only in the low skills workers, but also to the high skills workers. (Kalleberg,2003)
Furthermore, functional flexibility is offering a chance for all the employees for learning, such as more training in case that the staff needs it. (Lopez-Cabrales et al,2011)
The organisation will also gain, the advantage to keep its employees for long-term and increase the productivity (Kelliher et al,2002), as the cover staff will receive extra training.
In additional, functional flexibility can lead the industrial companies to very important improvements regarding the productivity. This means that the old and traditional methods will not be any more in use and they will be replaced with workers who have more skills and knowledge. As a result this will bring greater efficiency. ( Decombre et all,2006).
If the Southern Food limited company uses this approach, it will be able to cut the need of hiring new staff and gain more money in order to cover the extra cost of the third machinery. Furthermore, the workers, who have lack of training and they do not know how to use the machineries, they will have the chance to gain the benefit to enrol in trainings, which will help them to build up their skills.
However, there are some arguments, which are supporting that the functional flexibility is not so beneficial and has disadvantages.
The disadvantages of this kind of flexibility are that in many cases increases the stress and may increase the workload for the employees. For the employer it means that they will have to give better training, more rewards. These are going to cost a significant aount of money and as a result the business economy is going to be affected. ( Decombre and Kelliher,2005).
However, Thibaut and Keller (1959) presented the model of social exchange. Regards this model we can exam how strong is the relationship between employer and employee and that depends on the level of satisfaction of both parties.
Social exchange model describes that in a relationship, which is satisfying, the employer should do something for the employees that will motivate them to invest further and in exchange the workers should offer better productivity in the workplace. This is the concept of the mutual investment. ( Tsui et all, 1997).
So, Southern Limited company will be beneficial if the productivity will be increased and spend less money. The workers also will be happier if there is a possibility of some rewards for every one of them and more flexibility in the working hours.
As a result the company could use methods to satisfy the employees and the staff will be more dedicated and give productive services in purpose to increase the slow production and gain some more money to buy the extra machinery.
ALTERNATIVE METHOD OF FLEXIBILITY
An alternative approach of flexibility is the numerical flexibility.
This method provides part-time contracts or annualised contracted hours according to the business demands. The workers will be in advantage because they will have to work the contracted hours in the week and they will cover as well the required workload. The employers also, will be able to use temporary staff outside the factory to cut the uncertainty. (Redman, Wilkinson ,2013)
This model of employing was developed by Atkinson 1984) According to this, the firm is separated between core and periphery. The core defines that the most skilled employees, who have more knowledge, will reserve the main firm and the periphery will be the less skilled workers. Numerical flexibility supports that long term employee contracts will mainly be provided by the company to the high skilled workers.
On the contrast, functional flexibility, which has been referred above, focuses mostly to the workers who have a wish to develop their skills.
The Southern Limited company could use this alternative approach to cover the employees, who are in sick leave or on holidays and also minimize any financial risk until they are able to hire more staff. This method could support the Southern Food limited regarding the costs as it is associated with a low unit labour costs (Altuzarra and Serrano,2010)
When this industrial company use this approach, it will be able to replace easily the regular employees and this will improve the inflow of new ideas and networks. ( Kato and Zhou , 2018).
However, Inchiowski and Shaw ( 1995) supported that long-term retention employees would be quite distant to apply important changes. However, these employees could be replaced easily, which can help the innovation and make the labour market more productive ( Bassanini and Ernst (2002), Nickell and Layard (1999) , Scarpetta and Tressel (2004).
When the Southern Food limited will also use the numerical flexibility , it will gain the benefit to replace the underperforming and low productive employees with more productive staff, having as a result to boost the company’s productivity and investment and it reaches the goals, which have been required by the bigger industry (Zhou et all, 2011).
On other hand, some implications have been reported regards numerical flexibility. First of all, there are reports mentioning that numerical flexibility is more effective in lower quality jobs ( Green et all, 2011),which, comes in contrast with southern Food limited because it is high labor company.
This method will also affect the well-being of the workers as they will have more lower of jobs (Alertaris , 2010).
Robinson and Smallman (2006), suggested that the numerical flexibility has higher rates of injuries and ill-health in the workplaces.
Furthermore, Matusik and Hill (1998) commented that numerical approach is more common to be found among the core workers in the firm. According to them, the core workers, who are able to develop in the functions of the company, where exist the bigger needs. These people have a better knowledge about the company’s stock knowledge, but the periphery staff will not be able to develop further ( Arvanitis, 2003)
SUGGESTIONS FOR EMPLOYEE RELATION ISSUES
The main employee relation issues, which have been identified, are that the high skilled workers received the same wages with the rest of the employees, despite the fact they offer better services. This is decreasing the morale and the staff does not invest so much.
Also only the staff of the unit B will receive rewards and not the other members. This will have as a result an unfair situation between the employees, because the rest of the workers feel unfairly treated by the employer.
As a result the high skilled workers will use the trade unions to ask them negotiate for them better or higher wages because they have more skills and they are working harder than the others.
The employees who do not receive rewards will also consider to join the unions to ask the employer to give them better benefits such as rewards.
All the staff can consider joining the trade unions as the working hours have been increased by the director.
However, there are other solutions rather than the trade unions for employees to express their thoughts and their concerns.
The employers can set up meetings with the employees in order to discuss their performance and to deal with their concerns.
These meetings are team briefings, where the team members discuss their problems and they are trying to find the best solutions.
On this occasion the managers are more responsive than listening to the unions. (Bryson, 2004).
These meetings can help Southern Food limited to smooth the problems with the employees and at the same time to solve any disputes.
Purcell et all (2003) also emphasized that the role of line managers could improve the employee involvement and increase the productivity in the business.
Furthermore, Forza,(1996) indicates that the most authors would support the statement that the employee involvement is an important element of line managers and it should be encouraged.
Employee involvement could be supported if the managerial team provides to the employees a satisfactory amount of information and training. ( Guerrero ,Barrand and Didier (2004) ).
Also, the level of employee involvement could be increased by specific training for the use of the machinery to the employees, who have not received it ( Brown and Mitchel (1991)).
So we can end, based on the above statements that Southern Food Limited company can increase the employee involvement if they give to the low skilled employees trainings and knowledge to be able use the machineries effectively.
Unions also could play an important role in the employee involvement as they will support the workers and negotiate with the organisation for their rights.
However, sometimes employee participation seems to be the opposite to the unionization, but that does not always mean that they are filling each other. The unions are dependent on the employee participation and when the involvement of the workers is stronger, the representation to the managerial team will be more effective( Hodgkinson A, 1999).
The Southern Food limited based on the above statement, could use the unions if they want better regards and more fair wages because the trade union could negotiate and pressure the managerial team.
Moreover, the issue with the long working hours should be looked at, since the employees will be working 24 hours.
According to the European Working Time regulations, the workers and employees should be not working more than 12 hours per day (https://www.gov.uk/maximum-weekly-working-hours).
It has been believed that the excessive long working hours impose a high cost to the employees regards the quality of their life, mentally and physically (Barnett 200). So the Southern Limited Food limited have to set up a plan to cut apart these hours, so the staff will not exceed the 12 hours per day, in order the employees to have a quality life balance and in the meantime to provide quality results in the factory.
The consequences of the long working hours are very significant and for that reason it is important to reduce them and set up clear policies about the working hours(Ganster D et all , 2018).
Furthermore, it is worthwhile to mention the potential hazards and risks from the long working hours. The employees will be stressed by the long working time and there will mainly be many hazards in their safety and health (Caruso el all, 2006).
Qualitative reviews have shown that long working hours are the main reasons for mental and health issues.( Bannai and Tamakoshi 2014; Solovieva et al. 2013).
Solovieva et al. (2013)and Steptoe et al. (1998) ,also, have supported that the excessive long hours will affect their diet and their exercise practise, and this will have negative results in their health.
In addition Christian and Ellis (2011) Landrigan et al. (2008) and West et al. (2009) mentioned that if the workers are working long hours ,they will not receive the propertime for sleep they need and that will have negative impact in the job performance and functioning.
As a result, we can conclude that if the workers of the Southern Food Limited will be still working long hours, they will have a poor well-being and this will affect their job performance and productivity. All these outcomes will affect negatively the productivity of the factory and it will raise more employee issues.
CONCLUSION
The problems of the Southern Limited Company are mainly the unfair wages, the rewards, which are given only to the high skilled workers, the extremely long working hours, the depleted trainings to the workers, who cover during the absences and the reduced productivity.
These issues can be resolved with two methods.
The first one is the functional flexibility, which will provide to the workers the learning opportunity and better job satisfaction. This will affect the productivity as the workers will be functioning better. Furthermore, when Southern Limited uses this flexibility, they will be able to save some money in order to meet the purchase of the third machine.
Another alternative method is the numerical flexibility, which is divided to periphery and core. This firm could help the industrial company to hire temporary workers when there are absences.
Also, the long-term contracts will be provided by the management team only to high skilled workers and this is cost effective to the company.
In relation with the issues about the working hours, the wages and the rewards, we referred above, the trade unions could negotiate regards these problems, and having the employees’ participation, they would be stronger and more sufficient to help them.
In addition, it has been noted that the managerial team would be able to support the employee involvement, without the trade unions. For example, the managers can create brief meetings to discuss the workers issues and find solutions for them. This way the company can gain more productivity as well.
Also, the problem with the long working hours could be resolved if the managerial team create some policies, which will be based on the working time regulations.
As we are summarising, all the main issues can be resolved if the Southern Limited Company decides to follow the above solutions. The employees will then be happy to accept these changes as the employers show the willingness to satisfy their staff.
RECOMMENDATIONS
Southern Food limited is recommended to take immediate measures to solve the issues have been aroused among the staff and have to do with wages, rewards and working hours and to provide fair solutions to the workers. The Company could use the Functional or the Numerical flexibility firm to discuss the problems regards the learning and trainings as well as the wages. The company should be able to pay the workers regards their skills and knowledge and reward them for their hard work. For example the high skilled workers should receive fairer wages as they provide more dedicated services and they are more skilled.
Numerical flexibility method is recommended to be used if the company wants to be cost-effective. As a method suggests the use of temporary workers during the periods of absence and provision with long-term contracts only to the workers, who have been considered as high skilled.
Also, this method could be used if the Southern Food limited is aimed to save money to buy the third machinery for extra productivity and complete the task, which has been requested from Frankie’s company and Big Dog.
It is recommended that the managerial team should use methods to increase the employee involvement and this way to prevent the participation of the trade unions in case the employees are not satisfied. Having this in mind, the Southern Limited will satisfy and the employees and will raise the productivity and the morale.
Finally, it is recommended that Southern Food limited should set up policies for the working hours, which will provide to the employees a work life balance and good well-being, because if they are satisfied mentally, not stressed and in good health, they will function better, the will have better performance and finally they will be more productive.
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