Approaches to Staffing (Edexcel A Level Business)

Revision Note

An Introduction to Staffing

  • Effective human resource management (staffing) is important to business as it ensures that the organization has:

    • The right people, in the right roles, with the right support, with opportunities to succeed

  • This will lead to higher productivity, more profits and a positive work environment

  • Human resource management focuses on how employees can be:

    • Effectively recruited

    • Effectively deployed (used)

    • Effectively developed and trained

    • Effectively motivated

    • Effectively managed and led

Staff as an Asset & as a cost

  • Staff represent both an asset and a cost to a business

  • Staff are an asset to a business as they bring knowledge, skills, and expertise to the business

    • Staff can increase productivity, drive innovation and enhance customer service - all of which contribute to the success and profitability of the business

    • Staff can help to build a positive reputation for the business through their interactions with customers, suppliers, and other stakeholders

  • Staff also generate costs to a business - and for many businesses staffing costs are one of the largest costs they have

    • There are costs associated with

      • Hiring and training workers

      • Managing workers as managers have to be hired

      • Paying the salaries of full time workers

      • Paying wages of hourly staff

      • Additional benefits, such as company cars, pensions, healthcare etc

      • Letting workers go (redundancy payments)

The Impact of National Minimum Wages on Staffing Costs

  • If the government introduces (or raises) a national minimum wage it applies to employees who receive a wage rather than a salary

    • Businesses that employ workers on a wage basis will face higher labour costs

    • Businesses that employ workers on a salary basis are less affected by the introduction of a minimum wage

      • They already pay a fixed amount regardless of the number of hours worked

Developing a Flexible Workforce

  • Flexible working is the development of a culture where workers are equipped to do different roles or where they work in a range of employment patterns (full-time, part-time, zero hours contracts, work from home, etc)
     

  • Developing a flexible workforce can bring many benefits to a business

    • Each specific approach should be assessed, as there are potential disadvantages to each

Diagram showing ways to develop a flexible workforce: multi-skilling, flexible hours and home working, outsourcing, part-time and temporary roles.

Allowing workers to work from home is just one of several methods available to businesses to develop a flexible workforce 

 Multi-skilling

  • Multi-skilling is the process of training workers to fulfil multiple job roles within a business

    • E.g. South West Airlines trains staff to handle multiple roles including check-in, baggage handling and customer service

The Advantages and Disadvantages of Multi-skilling

Advantages

Disadvantages

  • Business utilise their workforce more efficiently which reduces labour costs and increase productivity

  • It can help to improve patient outcomes in healthcare industries as workers with a broader range of skills can provide more comprehensive care

  • May require significant investment in training and development

  • May not be appropriate for all job roles, especially those that require a high level of expertise

 

Part-time and temporary working

  • Someone who works part-time may only work two or three days a week

  • Someone who works temporarily shows up for work whenever the business needs them

    • E.g. Amazon employs temporary workers to handle seasonal spikes in demand such as Christmas

The Advantages and Disadvantages of the Business of Part-time & Temporary working

Advantages

Disadvantages

  • Flexible working arrangements can help businesses to attract and retain talent, especially staff who value work-life balance

  • This may improve productivity, as staff can work during their most productive hours and avoid distractions 

  • Flexible working arrangements can create challenges in terms of communication and collaboration (especially if staff are working remotely)

  • Monitoring and managing flexible workers can be more difficult 

Outsourcing

  • Apple outsources much of its manufacturing to Foxconn in China

    • This allows the company to produce products at a lower cost and maintain competitive pricing

The Advantages and Disadvantages of Outsourcing

Advantages

Disadvantages

  • This may allow businesses to access specialised skills that may not be available in-house

  • May reduce labour costs

  • This may lead to a loss of control over quality and delivery, especially if the outsourcing partner is based in another country

  • This may create ethical concerns, especially if the partner is based in a country with lower labour standards or human rights abuses

Flexible hours

  • Flexible hours allow employees to schedule working hours around their individual needs and accommodate their commitments outside of work

  • A flexible hours schedule usually involves working some set hours, with the remainder of hours organised according to the employees' needs

    • E.g. An employee may be expected to be at work between the hours of 10am and 2pm, but can choose when they complete the rest of their working hours

Home working

  • Advances in communication technology have enabled a larger proportion of workers than ever before to work from home

    • Employees use tools such as email, instant messaging, collaborative software, scheduling apps and videoconferencing to carry out work remotely

  • Home working has a range of advantages and disadvantages for both the business and its employees

Advantages

Disadvantages

For the Business

  • Smaller or fewer premises may be required, reducing costs

  • High quality workers may be attracted from a wide geographical area

  • Workers may be more productive if they work in isolation, away from distractions

  • The cost of equipping workers with technology to work remotely may be significant

  • There may be less opportunity for collaboration between workers, reducing innovation

  • Careful monitoring will be required to ensure remote workers remain focused on tasks

For the Employee

  • Commuting costs, such as train fares, are eliminated

  • Stress reduced as a result of not having to travel to work

  • Some flexibility may be possible, allowing workers to manage other commitments

  • Staff may feel isolated from colleagues

  • Household costs such as electricity and heating may increase

  • A healthy division between work and home life may be difficult to manage

The Distinction Between Dismissal & Redundancy

  • Dismissal (firing or sacking) is the termination of employment by an employer against the will of the employee

    • Employees are usually terminated due to their misconduct (e.g. violating company policy) or poor performance

    • The employer may choose to dismiss them immediately (without notice or compensation) or provide a notice period which they can work out

  • Employees are made redundant when the job is no longer available and the business reduces the size of its workforce

    • The termination is not due to any fault of the employee

    • The employer must follow certain legal procedures, including providing notice and paying redundancy compensation

Different Approaches to Employer/Employee Relationships

  • The nature of the employer/employee relationship is influenced by whether there is an individual approach or a collective agreement

Individual and Collective Bargaining Approaches Explained

Individual Approach

Collective Bargaining

  • Focuses on the relationship between an employee and their employer

  • Assumes that each employee is unique and has their own goals, motivations, and interests

  • It emphasises the need for tailored compensation packages that cater to each employee's unique skills and needs

  • The employment relationship is a voluntary agreement between two parties in which both negotiate their respective roles, responsibilities and benefits

  • The employer has the power to hire, fire, and set the terms and conditions of employment

  • A process whereby a group of employees (represented by a trade union) negotiate with their employer for better wages, working conditions and benefits

  • Employees have more bargaining power when they negotiate collectively rather than as individuals

  • The employment relationship is seen as a power struggle between two parties with conflicting interests

    • The employer wants to maximise profits by keeping labour costs low

    • The employees want to maximise their wages and benefits

    • The union acts as the collective voice of the employees and bargains with the employer on behalf of all workers

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