KGW Corporation’s Human Resource Management

Primary findings for each case

The organization is poised to remain profitable throughout the current period of operation up to the year 2017, with a marginal increase in profitability in successive years. The rise in profitability will be due to projected increases in the number of clinical patients attended and the equivalent number of days for helping the patients. The organization is also going to succeed out of its ability to sustain a marginal increase in the average bill of clinical patients that will correspond with an increase in the overall revenue. Meanwhile, there will be an increase in occupancy rates for the centers of patient care that will eventually lead to increased business activity and improved efficiency of employees.

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Besides the improvements in productivity that are projected and the overall growth in business activity in different spheres, the characteristics of the firm’s human resource remain relatively static. The ethnic mix, which is the ration of the non-minority to the minority workers, varies from a high of 2.96 to a low of 2.94. Besides, the gender mix, which is a ratio of female to male employees, ranges from 1.49 at its highest and 1.47 at its lowest. The ranges are for four years, and they indicate that the composition of the staff at KGW Health has remained the same throughout the analysis. A probable outcome is that the ratios will persist throughout the next decade, as the company is unlikely to overhaul its primary workforce.

It is unsurprising to have salaries and fringe benefits dominating the operating expenses of the organization, given that KGW Health is a service-based organization. Nevertheless, these two expense categories have remained balanced in three years of review, increasing only marginally, with projected reduction and increases that are single-digit percentages lower than five percent. The outlook shows that the organization has a firm grip on its compensation expenses that are significantly less than the total revenue.

The organizational structure of KGW HR is a primary obstacle to the efficient handling of HR department roles within the organization. The structure is quite rigid and limits the functionality of the HR department within the set parameters of the organization. Happenings in other departments remain outside the HR realm until they grow to become major issues capable of being handled by the executive management of the organization. The various KGW Health departments connect at the executive level. Here, the vice presidents, serving as heads of department, can deliberate on matters and come up with joint resolutions for dealing with different issues in the organization.

Facts we learned about KGW’s HR assets and practices that raise further questions

Many of the firm’s employees come from the same state, Philadelphia, which is bound to create a localized tradition within the organization. The question arising from this finding is whether the localization of the majority of the workforce has any implication on the execution of human resource policies throughout the firm. It would be interesting to know whether localization works in favor of or against the objectives of the organization.

Within the organization, the department of HR is well anchored in the top leadership structure of the company; it reports directly to the CEO, with some intervention and oversight arising from the office administrative assistant. After the CEO’s position, five vice president positions are overseeing various functions of the organization. The vice president of human resources oversees the work of the compensation and benefits manager, the employee relations manager, the recruitment manager, and the executive secretary for finance. There are three positions for the employee relations manager. It implies that a significant component of HR activity at KGW is to ensure that employees can voice concerns, have communication capabilities with the top management, and receive rewards and other obligations as assigned.

With the above arrangement of the top leadership at KGW, an arising question is whether the parallel powers and activities of the five main departments of the firm aid or impede the work of human resources. The five agencies may work jointly in creating and implementing policies that ensure the optimum productivity of human resources. However, any disagreement at work within the top leadership will likely jeopardize efforts by the HR team to coordinate the affairs of employees throughout the organization. There is a risk of having an HR department that is just a formal entity within the organization. Such a department would lack particular abilities to initiate and manage the change that can lead to an improvement in worker morale, voice, and work performance. There is no clear path for workers to pursue when they feel aggrieved or when they need changes made within the organization.

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Currently, employees have to go to the HR department, reporting to their employee relations managers. On the other hand, there could be issues relating to other departments within the organization that may be beyond the jurisdiction of employee relationship managers. The current structure of the organization does not provide a succinct outlook on how such incidents are resolved. An example could be regional issues on employee job assignments. An explicit chain of command for addressing issues that arise is missing, and there is a likelihood that HR-relevant issues raised by workers or middle-level managers will be approached by a non-HR department or management office. In this regard, there is a need to have a persistent HR department present throughout the organization rather than just an isolated unit. The firm has a silo structure, which will derail decision making and impede staff empowerment. A question arising out of this fact is whether the expected problems are occurring within KGW Health and whether the organization is capable of coming up with corrective policies that will address the problems and their causes.

The insights revealed in the KGW labor force, KGW management practices, or potential strategic risks that warrant further analysis/intervention in the future

The labor force of KGW is mostly connected to communication channels and can be reachable by phone or email. KGW’s labor force is organized hierarchically, with all employees having an office to report to for their duties and oversight. The hierarchical order appears throughout the organization, with the main offices being the office manager, patient care coordinator, accounting manager, and center administrator.

The age range for employees is broad, with the oldest employee at KGW being older than 59 years while the youngest is about 23 years old. The wide range in age is a sign of the inclusivity of the organization for different employee roles. However, it brings out the question of whether the organization is capable of handling the generational differences of employees working side by side when they have different views of society, work, and incentives. KGW has to use some HR strategies to ensure that compensation mechanisms appear fair and motivational to its employees of different backgrounds; otherwise, the organization risks alienating some of its fundamental human resources.

Most recruitments in the company happened between 2007 and 2009, which gives the labor force a common reason that can be used for bonding and establishing a cohesive employee culture. The experiences of most of the workers joining the organization during the same period will be similar. Moreover, they can look at their ages as a connecting factor, rather than focus on their actual years that vary considerably.

It would be useful to understand the interaction of various staffs’ factors contributing to the heterogeneity of the organization. These include the communication preferences of different personnel groups determined by age, background, gender, religion, economic status, job position, and any other significant difference. An insight into the preference for communication can help HR to realize the best approach to addressing concerns or pushing through with its programs on motivation, talent management, and employee retaining strategies.

When organizations grow enormous under their founding structures, they can become too dependent on bureaucracy and end up crashing under their weight as decision-making becomes impossible. Therefore, the growth of KGW Health, arising out of an increase in labor force size and complexity, should be a cause for concern.

Are there aspects of current HR relevant conditions/trends that could provide strategically relevant business opportunities for KGW Health in the future? How can we take advantage of those opportunities?

Significant aspects of current HR relevant conditions and trends have the potential of providing relevant business opportunities for KGW health strategically in the future, where the key one is the young employees. The business continues to grow and develop a corporate culture that will define its innovativeness and ability to respond to changes. A younger workforce is agile enough to change rapidly when the environmental factors are conducive to change. On the other hand, a capable management team is one with sufficient experience in leading change and sustaining progress within the organization (Solnet Kralj & Kandampully 2012).

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The employee database indicates the recruitment of most workers within the last decade, which makes them relatively young in the organization. Overall, the firm is still young and can learn new ways of thriving in its business. There is room for bringing new ideas to the management of the organization and administration of employee affairs. Handling these opportunities well will bring out a unique competitive factor that helps KGW Health to achieve and sustain a market leadership position in its service delivery (Bratton & Gold 2012)

From the outcome of the analysis, it is apparent that female employees outnumber male employees at KGW Health. While this can be a source of concern when looked at from a gender equity perspective, it is also an advantage for the organization when considering the ability to implement policies that are geared towards compassion and hospitality. With a majority of staff being of the female gender, the organization would be in a good position to embrace values that have a feminine sense and contribute to its hospitality business. An important component of any hospitality business is the provision of care by an empathic and well-informed workforce (Chiang & Birtch 2008). A high number of female employees give the organization an upper advantage for dealing with empathic demands of the business, unlike other providers that may not have similar power in their employee gender ratios.

Nevertheless, pursuing a hospitality business outlook that increases the reputation of the enterprise, its brand value, and the overall success of its programs must be undertaken carefully. A good way to do it would be to come up with a balanced scorecard approach that lays out the minimum performance thresholds for its value systems. With this approach, the business would not be concerning itself with the attainment of profitability only; it would also consider the satisfaction of employees, patients, and other stakeholders. The holistic approach would guarantee the sustainability of the present business practices when they contribute to the overall growth of the enterprise. At the same time, it would be simpler to come up with solutions for different concerns raised by segments of the labor force without causing problems for other departments of the firm.

An example of addressing the opportunities highlighted above is in the case of compensating employees in different departments. Currently, the business is relying on grade levels, which it matches with market rates for various categories. This way, the organization can compensate employees in a way that ensures it follows the best market practices. However, the approach is only able to give the business a threshold competitive advantage. Other organizations can easily match the strategy and compensate their employees as per the market rates.

The organization can come up with department-related compensation programs that may not have to be monetary-based, in addition to grading employees and giving them market rates for their compensation. They can include leaves, free time for doing personal projects, supported employee learning trips, or development of baby care facilities and the introduction of work-from-home offers. These additional incentives for employees will not have a significant impact on the organization’s financial outlook because they are not recurring in nature. They can be alternated with other options in the different economic periods. On the other hand, they are unique to the needs of the organization.

HR can use the variable compensation options that are rewarding and incentive-based as a way of dealing with generational differences in the workforce. The opportunities will also ensure that employees can relate to the organization more than they currently do from their salaries and other basic allowances (Solnet, Kralj & Kandampully 2012). Extra employee packages that encourage cooperation, a sense of community, and co-creation of organization culture would be necessary for an organization seeking to develop its capacities and increase its revenues in the long-term (Ulrich 2013).

A rigid structure like the one that is currently in place gives KGW Health and ability to prevent mischievous activities of the employees. It limits power plays and allows the execution of executive orders to happen fluidly. At the same time, the current labor force does not significantly influence the profit margin of the organization negatively, and there is no need to downsize. However, there is a room for conducting talent search programs within the organization and grooming leaders to take over different departments and business units. Currently, no such program exists, which will negatively influence the transition of leadership in the organization. Nevertheless, its current hierarchical structure offers the opportunity for leadership and management rotation in a different department as part of the next leadership-grooming program (Rothwell 2010).

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Specific recommendations to make to KGW Corporate and HR management for new initiatives or changes to the existing policy in the next “business cycle”

The KGW corporate and HR management must come up with mediation departments that operate parallel to the hierarchical organization structure. The current structure of the organization does not provide adequate bottom-up communication channels that would be useful for addressing employee grievances and taking up suggestions on ways of improving compensation packages and addressing labor market changes. The rigid hierarchical structure of the organization possesses challenges in HR work by introducing bureaucracies that affect program goals, decisions, and organizational purpose. Many interventions that only take place in the HR department may appear out of sync with the organization’s expectations. On the other hand, the HR management at all levels may often find itself having to abandon its policies and programs. Instead, it may defend and implement other executive programs that are not readily accountable concerning the HR management’s purpose in the organization (Bratton & Gold 2012).

Communication within organizations supports the performance, as different variables influence each other. Given that organizations of any kind have their human resources as the primary influences on performance, it is important to address any communication bottlenecks appearing in a perceived or actual way within an organization. Currently, departments follow a hierarchy that makes them communication silos. The only way to move official communication across departments is to make it a statement on the corporate level and then push it down, according to respective vice-presidential offices answerable to the CEO. An alternative would be to have crosscutting communication channels that allow middle-level management staff to communicate with each other across departments without going up the hierarchy channels.

The approach recommended above will give the organization a better grip of its tacit knowledge on productivity and organization cohesiveness, making it possible to implement a range of HR policies with ease. Following the theory of modern organizations, it is paramount to limit dependence on the definition of an organization as a group of people bound by tight rules. Instead, embracing the view of an organization as a network system consisting of people with interdependent relationships will allow KGW Health to realize its full productivity and value-creation potential (Bratton & Gold 2012).

While having a parallel structure can reduce the pressures of decision-making and allow improved agility within the organization, there should be only one overall leader in every department and sub-department within the organization. The introduction of parallel leadership can introduce new bottlenecks as employees have to report to different managers, which makes it hard to reconcile policy implementation efforts (Rothwell 2010). A preferred way of dealing with the suggestions presented above is to have projects and teams within the organization that can have deliverables and communication privileges bypassing immediate line managers. The teams will be able to investigate and implement individual management policies without interfering with the present structure. Moreover, they can help to address specific employee concerns and problems arising from compensation and composition or job allocation matters. Besides, teams can consist of staff from different departments to bring up additional knowledge to assist in decision-making in the HR department.

Reference List

Bratton, J & Gold, J 2012, Human resource management: Theory and practice, Palgrave Macmillan, New York, NY.

Chiang, FF & Birtch, TA 2008, ‘Achieving task and extra-task-related behaviors: A case of gender and position differences in the perceived role of rewards in the hotel industry’, International Journal of Hospitality Management, vol 27, no. 4, pp. 491-503.

Rothwell, WJ 2010, Effective succession planning: Ensuring leadership continuity and building talent from within, 4th edn, AMACOM, New York.

Solnet, D, Kralj, A, & Kandampully, J 2012, ‘Generation Y employees: An examination of work attitude differences’, The Journal, vol 17, no. 3, pp. 3-37.

Ulrich, D 2013, Human resource champions: The next agenda for adding value and delivering results, Harvard Business Press, Boston, MA.

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