Strategic Human Resource Management in Organisations (Nokia)

                                                          In the name of Allah, the most gracious, the most merciful                                                         

Introduction

Nokia is a Finnish multinational communication corporation headquartered in Espoo, Finland. It is a public limited liability company listed on the Helsinki, Frankfurt, and New York stock exchanges.

At the end of 2010, Nokia operated a total of 16 manufacturing facilities in Brazil, China, Finland, Germany, Hungary, India, Mexico, the Republic of Korea and the United Kingdom.

Nokia’s mission is simple, Connecting People. Its strategic intent is to build great mobile products and to enable people everywhere to get more of life’s opportunities through mobile phones.

Nokia use to be at the fore front of innovation in mobile industry and it had a huge market share of mobile phones for at least a decade. But thing began to change in 2007 with the launch of iPhone and the later with the introduction of android enabled mobile phones which laid the foundation of apps development. It opened new possibilities for the mobile app developers to create innovative applications for the end users and earn revenue from the download and updates. This created a difficult situation for Nokia which did not adopted to this innovation in the mobile industry. Hence it lacked behind and kept itself with its symbian mobile operating system which worked for it for over a decade. Nokia did not realise how quickly the industry would change and the new eco system of mobile apps would sweep it across. And this is exactly what happened, Nokia lost its market share dramatically since 2007 and it’s now facing a difficult time and all now the only way forward is to innovate and bring new ideas and inspirations into reality and find ways to better help customers.  

The Scenario:

Nokia is a well renowned mobile manufacturing company. In the past Nokia was holding a prestigious position in the mobile market which has been affected due to a change in technology in the mobile communication industry. My task in this assignment as a Strategic HR Manager is to help Nokia pull out from its current position and regain its position as a market leader. It would be my responsibility to make strategic human resource decisions and suggestions in order to bring changes in strategic human resource strategy. I would be advising the Nokia’s higher officials on policies and issues pertaining to human resources and the impact which they had on the company.

a) Understanding the events at Nokia (emerging from the strategic decision), explain the importance and purposes of strategic human resource management for Nokia (10.1.1, 10.3.1)

Strategic human resource management is the process of linking the human resource function with the strategic objectives of the organization in order to improve performance.

Strategic human resource management (strategic HRM, or SHRM) may be regarded as an approach to the management of human resources that provides a strategic framework to support long-term business goals and outcomes. The approach is concerned with longer-term people issues and macro-concerns about structure, quality, culture, values, commitment and matching resources to future need. (cpid, 2013)

Strategic management is considered to be a continuous activity that requires a constant adjustment of three major interdependent poles: the values of senior management, the environment, and the resources available (palgrave, 2013).

In today’s businesses, the right approach and management of the company’s employees can greatly affect the company’s overall performance. A strategic approach in Human Resource Management is vital especially in growing companies. Starting from right staffing to maintaining performing employees, HR management is a key in developing not only the employees, but the whole organization itself.

Human Resources encompasses a broad scope in management. An expanding company dependent on its current success can maintain and further develop its business starting with the right staffing. As demands for the product or services increase, additional manpower is needed to comply with them. The current manpower should be checked but not simply if they can comply with the demands, but it has to ensure that it can still keep its quality and standards. Mass production or bulk orders should not be an excuse in decreasing quality, hence, increased customer dissatisfaction and decreased sales.

For a company like Nokia that is already recognized in the industry and is eyeing on expansion, their status and reliability should be maintained with their SHRM policies. The leaders of the company can now focus on the products, competition and expansion, and let the HR Department handle the development of the organization.

Keeping an eye on the company’s long-term goals, mission and vision, the development of performance standards is essential to identify potential problems, non-performing employees and compliance to tasks and standards. Minor employee and performance problems should be seen immediately to avoid any future inconvenience and potential problems to the customers and thus become a liability to the company. HRM professionals can also identify the processes and the proper staffing for each of these activities, and in effect, the systems and approach in terms of the company’s front line operations can be improved to decrease manpower hours, improve quality, streamline processes, and elevate standards.

Armstrong and Michael (2003) suggest that HRM needs to achieve the following strategic goals in order for the company to gain and sustain competitive advantage:

• to invest in people through the introduction and encouragement of learning processes designed to increase capability and align skills to organizational needs,
• to ensure that the organization identifies the knowledge required to meet its goals and satisfy its customers and takes steps to acquire and develop its intellectual capital,
• to define the behaviours required for organizational success and ensure that these behaviours are encouraged, valued and rewarded,
• to encourage people to engage wholeheartedly in the work they do for the organization,
• to gain the commitment of people to the organization’s mission and values.

To achieve these goals it is necessary to understand the linkage between HRM and business strategy and make sure that the HRM strategy is in line with the business strategy.

b) Assess the regulatory impact of strategic human resource management policies in the Nokia. (10.1.2, 10.3.2)

Strategic human resource management is based upon the recognition that organizations can be more effective if their human resources are managed with human resource policies and practices that deliver the right number of people with the appropriate behaviours, the needed competencies and the necessary level of motivation to the organization.

Impact of SHRM on Nokia

Human resource policies play a huge role in an organisation. The human resource management function has consistently faced a battle in justifying its position in Nokia. At good times when there are enough budgets, Nokia easily justify expenditures on training, staffing, rewards and employee involvement systems, but when faced with financial difficulties, such HR systems get the earliest cutbacks.

Impact of SHRM on Nokia in the UK

HRM discipline has witnessed a great deal of change over the past 25 years in the UK. These changes represent various major transformations.

Many companies when then want to expand or setup a new business they have to take into consideration the government laws that affect the human resource policy. These could be hiring laws, international laws, foreign policy towards a particular country and so on.

Investors, entrepreneurs and exceptionally talented people are bound to adhere with these laws for them to work in the UK. 

Many companies take strong notice of regulatory laws that affect their strategic human resource policies and make sure that they comply with the organization overall business policies. 

Immigration Laws

With UKBA laws on work permits, most companies including Nokia find it difficult to hire talented international individuals who graduate from the UK universities but due to immigration laws companies cannot recruit them.

Many talented students are just kicked out of the country just because of their visa status, even if the companies want to hire them as they bring fresh ideas into the company.

Minimum Wage Rate

The minimum wage rate is another concern for the companies when they    hire any employee and this comes under the umbrella of regulatory impact of human resource management. The minimum salary rates for the job for new starters and for experienced staff – are all defined in the codes of practice.

Equal opportunities

Employers like Nokia have to comply with the UK laws for equal opportunities and the companies have to make sure that their HR policies are not discriminating against certain group of people. All people should be treated similarly, without any prejudices, preferences or discrimination.

Mergers and the government policies

All companies are subject to government policies when they acquire or merge with another company. Strategic human resource management plays an important role in assisting business strategy to comply with government policies. Most companies have to go thorough government approval to undergo merger and acquisitions.

10.1.3) and evaluate the contribution of strategic human resource management to the achievement of Nokia’s new objectives.

Nokia’s HR policies have played a key role in helping the company to reach its 40 percent share of the global handset market and industry-leading profit margins of 20 to 25 percent, at a time of technological change and intense competition from Asian manufacturers.

Nokia’s New Objectives

Nokia’s New HRM Objective is to “Recruit the best and smart people”.

Nokia’s new Business objective is to implement creativity and innovation in its management and leadership style.

In order for Nokia to compete in a very competitive environment it need to constantly re-invent it-self and bring new creative and innovative products in the market.

There is an opportunity for potential new leadership, implementation of lateral thinking, visioning and innovation style at Nokia.

Nokia’s mission “Connecting People” is a powerful slogan which exquisitely defines its purpose of being in the mobile industry, which is to connect people. This statement gives a positive message for its employees who work for the company that their ultimate goal is to connect all the 6.5 billion people of the world.

Creative and Innovative Leadership

We suggest implementing the Google’s innovation management model on Nokia. Google has a very flat management structure and engineers generally have to report to just the project managers. In addition to that, Google’s management encourage their employees to produce creative work in their working hours. For Nokia to succeed in the technology market which is stimulated by innovation, they should adopt the Google 80% rule. According to Eric Schmidt the CEO of Google while speaking at the Princeton University he quoted: “We encourage all of our employees to spend 20% of their time to do what they are interested in and what they love to do, not what their boss wants them to do; and out of that most of our great new products have come from” and this is how they have incorporated the innovation culture inside their organisation.

Implementing such 80-20 rule in Nokia would also encourage their employees to innovative and come up with ideas that would be beneficial to the company and would also facilitate the users. It is a WIN-WIN model for the Nokia and their employees.

Role of SHRM

Strategic Human Resource plays an integral role in the implementation of new creative and innovative management style at Nokia.

Human capital management

It depends on SHRM weather Nokia could offer competitive salaries like Apple, Microsoft and Google. And if Nokia can invest in Research and Development like Mirosoft. All of these are pertinent questions and it depends on the SHRM policies weather this could be achieved.  

SHRM promises Nokia employees a career that that they can be proud of. It creates continuous opportunities to challenge them and offer them resources to lead a balanced life.

Efficient human resource management

HRM is responsible for the attraction, selection, training, assessment, and rewarding of employees, while also overseeing organizational leadership and culture, and ensuring compliance with employment and labour laws.

Some of the ways by which HRM can help Nokia achieve its objectives is by offering its employees:

1) Flexible Working hours 2) Compensation 3) Non-Discrimination 4) Freedom of Association 5) Eliminating Forced Labour 6) Child Labour avoidance 7) Disciplinary practices 8) Occupational Health and Safety 9) Promotion opportunities 10) Management systems

Influence of HRM strategy on Organisational strategy

Strategic human resource management may bring a number of benefits to the organization:

• Contributing to the goal accomplishment and the survival of the company,
• Supporting and successfully implementing business strategies of the company,
• Creating and maintaining a competitive advantage for the company,
• Improving the responsiveness and innovation potential of the company,
• Increasing the number of feasible strategic options available to the company,
• Participating in strategic planning and influencing the strategic direction of the company as an equally entitled member of top management,
• Improving cooperation between the HRM department and line managers (dho.edu.tr, 2013)

c) Analyse the business factors that underpin the new human resource planning in Nokia (10.2.1)

Human resources develop programs designed to ensure that the performances of the employees within the company are aligned with the organization’s mission. Human resource management analyzes the purpose of the mission and establishes policies and procedures to control the selection and development of the organization’s employees. (Chron, 2013)

HR Plan

A new HR plan is needed for Nokia in order to bring a change in its culture and to support creativity and innovation in it products and services. The way this could be achieved is by defining new strategy for its human resource planning.

Nokia’s New HRM Objective is to “Recruit the best and smart people”.

Nokia’s new Business objective is to implement creativity and innovation in its management and leadership style.

Strategic HRM ensures that Nokia’s business strategy matches with its human resource strategy.

The way by which business objective could be achieved is by adopting Google’s style of leadership. Implementing such 80-20 rule in Nokia would also encourage their employees to innovative and come up with ideas that would be beneficial to the company and would also facilitate the users. It is a WIN-WIN model for the Nokia and their employees.

Strategic Human Resource Management Planning

Strategic Human resources planning is an important component of securing future operations for Nokia. For sustainability, plans must be made to ensure that adequate resources are available and trained for all levels of an organization.

HR Planning involves gathering of information, making objectives, and making decisions to enable the organization achieve its objectives.

HR planning translates the organisation’s objectives and plans in to the number of workers needed to meet those objectives.

When HR Planning is applied properly in the field of HR Management, it would assist to address the following questions:

1.How many staff does Nokia have?

2.What type of employees as far as skills and abilities does Nokia have?

3.How should Nokia best utilize the available resources?

4.How can Nokia keep its employees?

HR department of Nokia has a unique challenge – it has to ensure that the employees are motivated and committed to the organization with complete integrity and honesty. However, at   the same time, the HR department has to ensure that the market dynamics are not adversely affected by the sheer volumes of investment involved in the process.

Implementation

There are various Human resource management policies that would be applied at Nokia in order to achieve its SHRM objectives. These include:

Recruitment    and   Selection

Recruitment at Nokia is the first and foremost step in the overall HR processes. With the reputation and promise that Nokia holds for thousands of technology professionals. Hiring the right people is a key HR philosophy at Nokia – the Y generation cyber ‐ generation professionals who are prone to changing their affiliations quicker than they change their clothes. Nokia should hosts many external events throughout the year which reflect a combination of their excellent recruiting practices and their awareness of the internal culture they want to maintain. They should be explicitly seeking to attract the kinds of people to the company who will be successful in their open, collaborative culture.

Training   and   Development   

Nokia  employees should be offered opportunities to learn and grow. Professional development opportunities offered to all employees include classes on individual and team presentation skills,  content development, business writing, executive speaking, delivering feedback, and management/leadership. Free foreign language lessons, including French, Spanish, Japanese, and Mandarin should also be sponsored by Nokia. Given the prominence of engineers at Nokia, particular attention is needed in providing unique development opportunities for this group. 

Innovation and Creativity

In order to implement a strong culture of innovation and experimentation at Nokia, one key Nokia’s SHRM policy is to adopt Google’s style management where engineers are encouraged to take 20% of their time to develop new product or service offerings, or to provide enhancements to current offerings. Innovation from inside the firm is the norm for most engineering based software development companies. What is unique at Google is the support provided by the company, the collaboration among engineers working on each others’ projects, and the final set of results that Google is able to achieve with the creativity and expertise of its engineers. So the same environment of creativity is needed at Nokia.

Compensation Structure

Proving a competitive salary with other benefits could make Nokia stands out as being one of the most sought after employers in the industry. However, the HR strategy fits perfectly with the business model and vision at Nokia – wherein employees are attracted not to the short term monetary returns from work, but rather to the support system that could help them create anything. So the work hives at Nokia have day care and elder care centres, have spa and hair salons, car wash and oil check facilities, and virtually everything that a technology ‐ obsessed geek would like to worry least about, in form of an all inclusive liberal benefits package, but the actual take ‐ out cash component is negligible. The Stock Option system at Nokia ensures that all employees get compensated competitively with the growth of the company.

HR Strategy influencing Business Strategy

The fact that Nokia would provides a Google’s style of 20% off time to employees for their creative pursuits is an HR practice that has reaped them rich rewards. However, the business implications of such rewards are very limited as compared to their market situation. HR department and the executives still continue to encourage employees for investing effort and time into such projects – the basic idea is that the employees remain motivated and committed to innovation and novelty.

The recruitment, on its part, becomes much more diverse with more and more talented minds looking to work in a company which would encourage and pay them for trying to build innovative products. This is a very peculiar case of a business strategy being an output of a deliberate HR strategy.

The Challenge of Recession

Global economic recession poses the unique challenge to the HR department of Nokia. Nokia as an organization have to be equipped to handle the recession because of its brand name, reputation and market share. In tough economic times, companies need to move forward while keeping their eyes on the global threats that might affect them.

Headhunting new talent

Recruiting bright talented people from across the world that brings fresh ideas to Nokia is one of the key responsibilities of HR. HR should hosts many external events throughout the year which reflect a combination of their excellent recruiting practices and their awareness of the new culture they want to maintain. They should be explicitly seeking to attract the kinds of people to the company who will be successful in their new open, innovative and collaborative culture.

10.2.2) and assess the human resource requirements for next two years (10.2.2) for the process of developing a human resource plan at Nokia (10.2.3)

Next two years are very important for Nokia in their bid to regain their market position. The company would have to reposition itself in the market at the same time it faces fierce competition from various companies from china which are producing low priced competitive phones.

This would require strategic human resource planning to continuously support the company by adopting various SHRM policies and the pursuing with them for a sustained period.

Human resources management must comply with all employment, health and safety and other relevant legislation applicable to the jurisdiction where the company operates. This includes state and local laws that pertain to various areas of HR such as recruitment, benefits, labour relations and termination. Keeping up-to-date with legislation ensures that the organization remains compliant and avoids costly penalties. Specially in UK, the laws related to recruitment are very strict and it’s a big challenge for Nokia’s HR to handle these.

Legal Requirements

Ensuring legal compliance with labour and tax law is a vital part of ensuring the Nokia's continued existence. The local government where the business operates impose mandates on companies regarding the working hours of employees, tax allowances, required break times and working hours, minimum wage amounts and policies on discrimination. Being aware of these laws and policies and working to keep the organization completely legal at all times is an essential role of Nokia’s human resources.

Minimum salary requirement

Foreign workers are allowed into Britain only if they meet minimum salary standards. Nokia HRM should be able to plan adequate methods to be able to comply with the minimum wage requirements.

Work Permits/ Recruiting Foreign Migrants

In UK to recruit foreign migrants there are laws and regulations set by the UKBA. These policies and procedures have to be followed if a company wants to recruite individuals from out side EU. HR needs to understand these policies and procedures and should make sure that legislations don’t become a barrier between companies goal to hire talented individuals from around the world.

Social Media

Social Media is going to play a huge role in next 2 years for Nokia.HR needs to be fully aware of the trends in the online social media and be proactive in this space.

Payroll

Human resource personnel need to ensure overtime pay meets government regulations, even if payroll processing is outsourced to another company.

Employee Benefits

Human resource personnel should provide training and information packets to employees to help them understand the benefits program a company offers.

Training

Human resources have a main function in providing training to the staff. On-the-job training is a requirement that the human resources department is responsible for providing. The training function for Nokia is increased as the company is running global operations in a number of different locations.

Benefits and Compensation

Non-traditional benefits such as flexible working hours, paternity leave, extended vacation time and telecommuting are ways to motivate existing employees and to attract and retain new skilled employees. Balancing compensation and benefits for the Nokia's workforce is an important HR function for next 2 years as it requires sensitivity to the wants and needs of a diverse group of people.

Compliance

Nokia HR must demonstrate compliance with employee-related legal requirements such as equal opportunity, gender neutrality and quality of the work-place environment. The HR should track employee characteristics, hiring decisions, employee evaluations and decisions for firing or layoffs. It should be able to generate reports detailing whether and how well the company is in compliance with legal requirements.

Privacy and Security

SHRM should ensure the protection of employee personal data according to privacy laws of UK by allowing only the employee himself and appropriate company personnel to view his data. The security module of HR also ensures that employees can only view sensitive data when they need it to perform their job. Data on promotional paths and candidates, for example, is likely to be severely restricted. The HRM security module should uses appropriate levels of security, including multiple layers, to protect the HR data.

Organizational Effectiveness

The strategic human resource management system of Nokia has a significant impact on individual and company effectiveness. A good SHRM brings consistency in human resource management practices and improves human relations in the company. An effective SHRM is focused on a strategic objective and works by improving employee knowledge, skills, motivation and contribution opportunities.

Strategic human resource management contribute to organizational effectiveness in multiple ways like

1. Talent Acquisition & Development

2. Management Development

3. Leadership Development

4. Management of the evolution of the Microsoft Culture

Empowering Employees

The focus of Nokia’s SHRM should be to increase the involvement of employees and empowering them. Under such a system, employees are given more decision-making power, and teamwork is encouraged. This requires trusting employees, training them, and giving them more decision-making authority. (SmallBusiness, 2013)

d) Present a critical evaluation on how the human resource plan can contribute to meeting Nokia’s objectives (10.2.4). In your evaluation,

i) Analyse the impact of Organisational structure and organisational culture(10.4.1, 10.4.2)

The human resources department plays an important role to the success of an organization. Human resource management is a vital part of Nokia. The HR team is responsible for diverse aspects of each employee's career, from recruitment to hiring to various aspects of their job while employed at Nokia. An effective SHRM effectively executes policies and procedures and keeps workforce motivated and productive.

HR Plan

Human resources develop programs designed to ensure that the performances of the employees within the company are aligned with the organization’s mission. Human resource management analyzes the purpose of the mission and establishes policies and procedures to control the selection and development of the organization’s employees (Chron, 2013).

Nokia’s New HRM Objective is to “Recruit the best and smart people”.

Nokia’s new HRM plan offers

• Talent and commitment of all of employees
• Men and women of different cultural or ethnic backgrounds, skills and abilities, lifestyles, generations and perspectives.
• Excellent opportunities for career development
• Commitment to the highest standards of ethical conduct
• Believes in diversity and inclusion in the workplace brings competitive advantage
• Helped to build the diverse and robust community that is Nokia today.(115 nationalities)
• Creates commitment, passion and inspiration.
• Encourages open discussion and debate.
• Programmes like “Listening to You” & “Ask HR” is conducted

Culture

The term culture is defined as common patterns of beliefs, assumptions, values, and norms of behavior of human groups (represented by societies, institutions, and organizations). In other words, cultural variables that may influence HRM practices can manifest at three different levels (Schein, 1992).

Impact of Organizational Culture on HRM

A company with a strong organizational culture can effectively change its culture because its employees are responsive to their organizational structure. (Chron, 2013)

Nokia has a Role Culture which is characterized by policies, procedures and practices that are formally laid down. Authority is clearly defined, as too are job descriptions, procedures for communications and other internal processes.

Nokia culture is based on features like:

•           Formal or informal structure

•           Centralised or decentralised decision-making

•           The extent to which innovative thinking is promoted and encouraged

•           Freedom of various levels of staff and management

•           Openness of communications

•           Layout and appearance of the factory or office

•           Formality of dress

•           Leadership styles adopted by managers

•           Educational attributes and intellect of employees

•           Acceptance or adversity to risk

•           Attitudes to teams

•           Attitudes to training and development

•           Attitudes to change and particularly, technology

•           Commitment to service and quality

Mintzberg’s Organizational Models

According to Mintzberg an organization's structure emerges from the interplay of the organization's strategy, the environmental forces it experiences, and the organizational structure itself. When these fit together well, they combine to create organizations that can perform well. When they don't fit, then the organization is likely to experience severe problems.

Different structures arise from the different characteristics of these organizations, and from the different forces that shape them. (MindTools, 2013)

The organizational structures that Mintzberg identifies are as follows:

• The entrepreneurial organization.
• The machine organization (bureaucracy).
• The professional organization.
• The divisional (diversified) organization.
• The innovative organization ("adhocracy").

For Nokia we suggest implementing machine bureaucracy structure in the organization.

The Machine Organization (Bureaucracy)

According to Mintzberg, the machine organization is defined by its standardization. Work is much formalized, there are many routines and procedures, decision-making is centralized, and tasks are grouped by functional departments. Jobs will be clearly defined; there will be a formal planning process with budgets and audits; and procedures will regularly be analyzed for efficiency.

The machine organization has a tight vertical structure. Functional lines go all the way to the top, allowing top managers to maintain centralized control. These organizations can be very efficient, and they rely heavily on economies of scale for their success. However, the formalization leads to specialization and, pretty soon, functional units can have conflicting goals that can be inconsistent with overall corporate objectives (MindTools, 2013)

Confidence in ability and leadership is also needed to persuade other. Stakeholders have confidence in those companies that have confidence in its leadership and its abilities.  Companies who cover up their faults and don’t learn from their mistakes and blame their employees are not going to win trust of its stakeholders.

Organizational structure

Organizational structure is the method by which an organization communicates, distributes responsibility and adapts to change (Chron, 2013).

Organizational Structure: According to (Najafbeygi, 2011) It refers to the rules that govern the relationship between people and groups who try to achieve the organizational goals.

Impact of Organizational Structure on HRM

Appropriate organizational structure, efficient procedures, safe instruments and equipment, balanced work environment and, above all, competent and qualified manpower are essentials that should be considered by managers to achieve optimal efficiency.

Organizational structure clarifies how duties are determined and what formal coordination mechanisms and organizational patterns of interaction that must be met (TextRoad, 2013)

Growth

A major factor that impacts organizational structure is company growth. As Nokia grows, the impact on the structure of the organization is significant. This can be especially true when the organization begins to expand to other geographic regions and the structure of the organization is spread out over many miles. An executive team may be required to run the various aspects of the business, and there may be the need for middle managers who would report to the managers (Chron, 2013)

Ethics

In Nokia, the makeup of the employees consist of individuals with different backgrounds, qualifications and experience. Human resources set employee objectives to make sure that the differences in employees are respected. There are also programs established that address personal issues concerning violence, spirituality, personal wellness and benefits. These issues are usually specified in employee personnel manuals, which also may include other company regulations.

Technology

Technology has a huge impact on how Nokia is structured and how work flows. Employees did not need to be in the same room, or even the same building, to be efficient. Technology can create positions within Nokia and it can eliminate positions. As technology continues to change the function of jobs in the workplace, the landscape of organizational structure changes with it.

ii) Examine how the effectiveness of human resources management could be monitored in Nokia (10.4.3)

Some of the overall goals of human resources management are to ensure that all employees perform their duties to promote the goals of the company. Also, human resources are responsible for taking the full advantage of the capabilities of the employees and placing the right employees in the right job positions.

Performance Management

The ability to effectively manage the performances of Nokia employees is an integral part of human resource management team. Establishing and implementing a complete performance improvement process is an essential skill needed at Nokia. Designing performance review process, maintaining it and effectively monitoring its implementation are challenging tasks. Coaching managers on how to use performance management program is also an important function of HR team. (Chron, 2013)

The effectiveness of Human resource management of Nokia could be monitored in various ways. One of the major role of HR is to

a)      Retain Key Current Employees

b)      Headhunt other important people from other organisations that could play an important role in the Nokia’s future growth and productivity.

There are two views to see HR performance. One is the micro level and the other is macro level.

Micro Level

In micro level the HR is involved in small detail planning and goes in deep details. This includes interviewing, Screening CV’s, Performance reviews of employees, Appraisals, offering training, Employee motivation, Succession Planning, Employee satisfaction and loyalty, Employee rewards, Growth & acquisitions are micro level views by which HR could improve Nokia’s effectiveness.

Macro Level

At macro level, the HR takes a larger view of the Organization. It’s a holistic view of the company.  In that the HR would determine how many vacancies are needed in Nokia in next 2 years. How are they going to be financed. How will the salaries be offered to employees and manpower planning all comes in the Macro Level.

To monitor the HR performance both macro and micro level are taken into consideration.

Employee Retention Rate

If employee turnover rate is high that means that many new people are joining the company  but at the same time its losing skilled workers. HR performance is measured by looking at the companies turnover rate and adopting methods to increase employee retention rate.

Succession Planning

Succession Planning is the ways by which HR recruite bright talented fresh graduates or interims via graduate schemes so that the company does not fall short of new ideas and there should be new people ready to replace old employees when they get retired.

Rewarding Performance

Measuring employee engagement levels to see how committed and loyal employee is to the company. One methodology to retain important people is to reward its employees.

• Rewards employees competitively through a global reward framework
• Nokia rewards employees for good performance, competence development, and for overall company success.
• Higher performance and contribution lead to higher rewards.
• Reward programs including- bonuses, recognize performance based on individual, team and company results
• Levels of compensation are determined by local labor markets
• Offers Equity programs to eligible employees
• Communicate with employees about the effect of business results on their incentives after each quarter
• Introduction of Investing in People (IIP) process
• Development and renewal of our employees skills and competencies is critical

And make justified recommendations to improve the effectiveness of human resources management (10.4.4)

In order to improve the effectiveness of Nokia’s human resource management, there are various procedures that could be adopted.

Compensation and Benefits

Human resource management should create, administer and improve compensation and benefit structures. Retaining excellent employees depends on many factors. Outstanding pay and benefits are two critical factors that will ultimately determine how well Nokia employees feel about the company and the likelihood that they will remain with Nokia in the future. Crafting an effective compensation system and determining the best benefits package for all employees are skills that are mandatory for your Nokias HR management.

These benefits could be offered to Nokia employees in many different categories depending on the ranks, designations and departments.

These Benefits would include

• Insurance (healthcare and life)
• Transportation (free buses)
• Gifts on special occasions (e.g. birthday, marriage)
• Relocation support (need based)
• Work related mobile phone
• Education assistance

Market Competitive Rewards

Other ways by which Nokia HR could improve its effectiveness is by

a)      Offering Basic pay with equity bonuses and incentives

b)      Health and welfare benefits

c)      Vacation and time off

Promises

·         A career that employees can be proud of

·         Continuous opportunities to challenge employees

·         Resources to lead a balanced life

Opportunities

• Offering Nokia employees  to take responsibility for their development
• Structured performance management system
• Personal development plan
• Opportunities for career progression and professional development through global mobility and continuous renewal.
• Gaining broad experience through horizontal career steps is encouraged as a way to proceed in your career
• Adopting global performance management process “Investing in People”.
• Education Assistance Plan

 

References

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Schein, E.H. (1992). Organizational culture and leadership (2nd edn.). San Francisco,   CA: Jossey-Bass.

Armstrong, Michael, Baron, Angela, (2003). Strategic HRM: The Key To Improved Business Performance, CIPD, London, p.xviii

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