Evaluation of Personnel Policy at Ozero Dessert and Tea and Recommendations
A personnel policy is a plan of action and group of proposals that act as a reference for managers and supervisors in dealing with their employees. The strategic human resource management means that human resource policies and practices, which produce employee competencies and favourable behaviours, must be planned and well executed. The human resource manager requires a practical way to translate the company’s strategy into the necessary employee competencies and behaviours.
This case deals with the human resource plan of Ozero Tea and Desserts, a small privately run business located in Little Tokyo, LA where I work. The company’s goal is to commit to quality and differential, offering the best Taiwanese tea to its customers. The restaurant was first established in South California in 2012, and it is an extension of already successful business in Taiwan. The main focus of the company is to offer personalised and unique experience to the tea enthusiasts of South California.
Looking at the plan of action of Ozero, we can see that its operational layout is characterized by lean operation where people have to order and take their food and then occupy the table. The focus is on increasing the efficiency and minimizing any delays. The restaurant works on an average of 12 hours per day with slight deviations in working hours during the weekday. The capacity utilization is normally 100% on weekends (Thursday, Friday and Saturday), while it is 60% on other days. The main personnel policy that needs to be evaluated requires the restaurant to maintain its efficiency and increase its productivity without any compromise in its customer services. The plan of action focuses on ‘lean’ operation that consists of 4 functional areas:
- Back office operations: It consists of two personnel, responsible for accounting and HR functions. They work separately with a standard 8 hours shift.
- Front Desk: It has three employees working as cashier, waiter and bartender respectively at one particular shift. There are two shifts and total six employees without any cross functional capabilities.
- Saloon operation: Run by two waiters and a busboy for cleaning as well as do home deliveries. There are total 3 employees and they possess cross functional capabilities.
- Operation Management: The management is handled by two individuals that work as tea shift managers on weekdays and are responsible for handling the operations of the tea shop.
This policy of improving employee efficiency needs to be updated and made more relevant to the Ozero Dessert and Tea shop. The managers and the administration need to focus on developing new employee competencies and behaviours. Because, in order to improve productivity of the restaurant staff, the management needs to first cut down on the personnel strength and then need to provide them with the necessary cross-functional training , along with necessary employee competencies, skills and behaviours that are required to excel in their specific roles.
The policy must be changed in the following manner: (Dessler G. 2010, p98):
- Introduce new training and communication programs aimed at assuring that the employees clearly understand the restaurant’s vision and what it expected out of them.
- Enhancing the work experience, that provides the employees with greater challenges and responsibilities through flexible work schedules, work hours and cross functional way of working.
- New training and benefit programs that promote staff’s personal growth, which means enabling the employees to take personal responsibility for self improvement and personal development.
- Improve the restaurant’s selection, training, orientation and dismissal procedures.
If these changes to the existing policy are implemented, it is certain that strategic goal of Ozero dessert and tea shop would be much easier to accomplish. It can manage the issue of slack and peak hours and maintain lowest possible costs with zero impact on the operations. It would also ensure that the restaurant builds a more dedicated, resilient, accountable, generative and productive workforce.
Analysis of Recruitment and Selection Process at Ozero Dessert and Tea and recommendations
As described earlier, there are total 13 people who form the working staff at Ozero. There are four functional departments and the operation management function is run by two shift managers. The current staffing looks like:
- Back office : HR + Accounting x 2 Employees = 2 Employees
- Front desk: Cashier+ Serving+ Bartender x 3 Employees x 2 shifts = 6 Employees
- Saloon: 2 Waiters + 1 Busboy = 3 Employees
- Operation Manager: 2 Teashop managers = 2 Employees
- Total 13 employees.
It is important here that the staff strength is reduced in size and cross functional capabilities be developed, if the restaurant wants to improve its productivity and manage the issue of slack hours.
Following table suggests one possible way of re-structuring and recruiting staff:
In this plan, the Back office function will be handled by only one Administrative clerk who will simultaneously look after the accounting and the HR function of the restaurant. The front desk department will be reduced from 6 workers to 5 workers, where the two Supervisors will assume the function of the cashier and 3 assistants will work as bartenders and waiters in turns. The most important change in the strategy would be that these 5 workers would receive the much needed cross functional training. This training would increase the flexibility of the restaurant and also improve its efficiency as by reduction in the staff expense. The Saloon operations would be reduced to 2 people, who would again be trained to act as delivery boys and waiters simultaneously. Finally, the operation management department can be reduces from 2 to 1 personnel, who would take complete responsibility over the operation of the restaurant. It is important for the tea shop to impart necessary training and development programs to these employees. It would ensure that there is good employee morale and satisfaction as it would lead to better results. This would decrease the number of staff from 13 to 9.
Another possible way of restructuring and recruiting staff would be:
The above method of restructuring would cut an additional worker from the front desk, will increase the cross functional capabilities, will reduce the staff size to 8 and will further improve productivity.
It would be very critical for Ozero to recruit its administration Clerk and Shop manager, as the relative importance of their jobs, as compared to others, is pretty high. A thorough job description is required to be prepared, based on which the management can start the selection process. The management can even use recruiting agencies to hire for the above positions and also consider specific application coming in through the tea shop. The most important aspect while hiring is to ensure compliance with the ethical and regulatory standards of the US Labor legislations. It is important to focus on work ethics by providing an equal employment opportunity to all applicants without any bias.
Some of the other initiatives that the tea shop can adapt are:
- Educate its staff on the importance of customer satisfaction and train them on aspects such as service quality excellence, being customer friendly and being presentable.
- The front desk team must be trained on soft skills and service aspects.
- Focus of the management staff should be on team management and motivation.
- Health and safety issues must be given importance and should not be ignored. It is important maintain cleanliness in the restaurant premise and kitchen.
- Improve co-ordination and be vocal about any concerns that might affect the efficiency of the restaurant or any particular individual.
- Most important is the emphasis on cross functional training, being a lean workforce, it needs to be effective it its functioning.
- Provide any good references for future employment with the restaurant.
- Work as a cohesive team and not as individuals.
- Being energetic and forthcoming towards any concerns of the customers.
- Making it a point to provide the ‘best customer service and emphasize on ‘customer delight’ and ‘customer loyalty’.
Performance Appraisal system at Ozero dessert and tea and recommendations
The mistake that is often made on initial stages of formulation and development of HRM strategy is lack of effective link between the actual level of motivation and satisfaction of a given employee and return, or contribution, for this matter , that this individual has on productivity and organizational effectiveness (Dessler, 2010). The role of performance appraisal was allotted to the Administration officer at Ozero dessert and tea, the officer had a full time 40 hours per week work schedule from Monday to Friday. His role included accounting management, basic HR responsibilities and remuneration and rewards.
As per the current performance appraisal system, it was based on the overall sales of the restaurant. If the restaurant reached and exceed $1000 in sales on a given day, the employees were given a 5% bonus on their weekly wage rates. For example, if shop manager was earning $16 per hour and the sales exceeded $1000 during that day, he would then receive a bonus of $0.8 per hour on his salary for that day.
According to me, the performance appraisal system at Ozero had to be dramatically improved, the reasons were:
- Most of the companies look at the compensation and reward management from two aspects; financial compensation, personal and professional development methods that introduces motivation and satisfaction in the remuneration schemes.
- A good performance management system must try to provide employees with comprehensive set of expectations and goals, it must include quantitative and qualitative measures in the form of KPIs ( key performance indicators)
- The employees must be compensated financially, professionally and personally based on their KPIs.
Some of the recommendations that can be applied in case of Ozero desserts and tea are:
- The company must introduce a new performance appraisal system that has a combination of financial, personal and professional benefits.
- Apart from a standard 5% bonus, employees must be awarded based on positive customer feedbacks, positive supervisor feedbacks, showing efficiency at work and taking initiatives.
- Employees can work for ‘extra hours’ on weekends and should be paid for that.
- While financial remuneration is critical as it determines the ability of employee to satisfy his personal needs, a number of other factors also affect their loyalty and performance. The four core drivers of employee motivation that can build a strong foundation are: 1. the drive to acquire 2. Drive to bond. 3. Drive to comprehend and 4. Drive to defend. (Groysberg, 2008).
- Being a lean organisation, the tea shop management can organise family functions and other employee welfare schemes that can strengthen employee motivation, loyalty and performance.
- Ozero can also introduce ‘Employee of the month’ scheme, where the management will select any particular employee during the month based on this performance and enthusiasm. This will promote healthy competition and also improve the restaurant’s efficiency.
Analysis of human resource strategy at Ozero and conclusion
It is said that the ultimate goal of any human resource department is to “increase worker productivity while maintaining a high level of employee morale and job satisfaction”. As described earlier, there are four basic drivers of employee motivation that can build strong teams: 1. The drive to acquire. It is a way in which an employee receives satisfaction through building relationships during significant events of his/her career such as promotion, bonuses etc. 2. Drive of Bond. When an employee feels that he is an integral part of the organisation, his morale is boosted. There is a sense of belonging, an urge to work for the organisation for his own betterment. 3. Drive to comprehend. This drive is seen in the employees who challenge themselves and seek new frontiers. This is important for those employees who have more complicated work structures. 4. Drive to defend. It represents an employee’s willingness to protect his opinions and standpoints. The resistance to change often causes loss of motivation when the company is going through a transformational phase (Groysberg, 2008).
Strong team are made based on these four principles and it allows the employees to be motivated and improve job satisfaction. If we look at Ozero tea shop in context to this, we can say that it has achieved its goal to some extent. The tea shop is doing pretty well; it remains packed during weekends and operates on a lean scale. But, there are areas that are required to be improved. New policies need to be put in place, if the restaurant wants to improve its customer delight and employee satisfaction. Also, there are people who complaint about how tea shop puts all their staff in same position. Although this is entirely not true, it shows that the current set-up of the tea shop needs a minor over-haul along with some policy changes as stated earlier.
If we get down to the basics, we can say that the management at Ozero must formulate a strategic plan. This strategic plan implies certain workforce requirement, in terms of employee skills, attributes and behaviours, that will enable the business to achieve its strategic goals. Given the workforce requirement, management will formulate HR strategies, policies and practices it believes will produce the desired workforce skills attributes and behaviours (Dessler, 2010).
In case of Ozero, once they decide on the proper workforce requirement, they can focus on HR policies relating to employee remuneration, employee satisfaction, training, development and motivation which will ultimately lead to customer’s satisfaction. Finally, the administrator must develop a score card that measures the extent up to which these policies are producing the desired results. Also, the employees need to be evaluated base on the KPIs and rewarded financially, personally and professionally.
This process can be shown in form of a line diagram:
Formulate Business Strategy
Identify Workforce Requirement
“What employee competencies must HR at Ozero deliver
Formulate HR strategic policies and activities
Focus on performance appraisal, employee motivation,
Organisation efficiency and competencies.
Develop and measure detailed scorecards to evaluate the results and changes
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