Introduction
One of the worldwide trends that affect every organization is cultural diversity. It can be highlighted as one of the most significant issues confronting international companies, but it may also present enormous opportunities for enterprises if adequately managed. It is important to note that globalization has greatly impacted how people live and work worldwide. As a result of the effects of globalization, the idea of cultural diversity has become concrete rather than purely conceptual.
This is diversification when people from diverse geographic regions and cultural backgrounds work together or live in the same building. Technology has created a global community where individuals may instantaneously and continuously engage with many interlocutors from different cultural backgrounds. Due to the constant increase in competition, businesses always need to go across borders to find new markets. Therefore, in these circumstances, cultural diversity must play a role in their human resource, providing them with serious difficulties.
It is worth mentioning that the company is severely lacking in considerations of its management and application of diversity principles directed at company growth. Arena Solutions will be successful only to the extent that the company employees will permit. The Arena management shows a poor comprehension of the differences between the behaviors they are molding and the behaviors they believe they are developing. This is a result of the ineptitude of the Arena’s administration which lacks the ability to guide the group. Thus, unqualified, poorly trained management leads to a decline in the profitability of Arena Solutions.
Arena Solutions
Arena Solutions Inc is a company that provides various technological solutions for product lifecycle management and quality management systems. The company assists cutting-edge electrical high-tech and medical device businesses in developing products that transform industries. Moreover, it integrates PLM and QMS systems, enabling collaboration among all parties involved in the product realization process from design through manufacture. It is worth mentioning that different organizations may enhance their profitability by speeding up product development and delivery using Arena’s products. However, it is challenging to project Arena’s profitability concerning its customers.
The company has experienced a severe decline in net profits due to poor management. There are various recommendations that could be made that are often described as primary ways to handle organizational management. One of them involves talent recruitment and diversification. These two aspects provide essential benefits for the company’s growth and development. The policy changes targeting these two aspects may allow Arena Solutions to reevaluate its leadership decisions toward new directions and bring the company towards profit.
Literature Review
The market is a significant motivator for many businesses when setting objectives and measuring success. BucÄĹŁa (2018) states that some objectives include cost reduction, meeting sales targets, expanding client numbers and market share, and developing innovative goods. The challenge becomes very serious for businesses that keep expanding into new areas. All levels of the organization should be able to grasp its objectives if they are to be communicated effectively. Moreover, BucÄĹŁa (2018) also mentions that they must be documented in precise goals conveyed at the levels of teamwork, unity, and the person. Modern businesses are utilizing innovative management techniques to create an environment conducive to high levels of productivity, focusing on improving conflict resolution, communication, issue solving, employee engagement in decision-making, and motivation (BucÄĹŁa, 2018). Consequently, BucÄĹŁa (2018) presents the idea that organizational management has increasingly sophisticated practices, focusing on relationships between people who interact in the same organization. Thus, it encourages teamwork and supports career development in an international context under the new economic challenges.
In order to manage endowed personnel, businesses must create and practice effective methods in today’s unstable economic climate. This problem becomes quite severe when a company keeps expanding into new markets. Building and maintaining a management team capable of being internationally influential is any company’s most difficult challenge, whether at the start of its activity or fully grown (BucÄĹŁa, 2018). The skill gap is a problem for businesses operating in markets that are expanding quickly. BucÄĹŁa (2018) explains that to develop and implement its global talent strategy, the rising multinational must overcome several obstacles. Due to cultural differences, disparities in approaches to talent management, challenges in employing both local and foreign talent in a balanced manner, and a lack of trustworthy leadership, it is challenging for them to build an effective international management team (BucÄĹŁa, 2018). The report demonstrates that building today’s global enterprises has made personnel management one of the most significant risk areas.
Establishing a solid management structure, allocating resources wisely, and creating numerous corporate rules and regulations are all considered part of organizational management. Peng et al. (2020) mention that individuals achieve a specified shared purpose, abide by specific rules and regulations, and create a job structure and cooperative division of labor in order to effectively and properly utilize the limited resources inside an organization. The goal is to guarantee the successful achievement of company objectives. As Peng et al. (2020) explain, understanding organizational management offers a foundation for looking at interim management problems. The knowledge of their forebears is useful to modern managers. Using ideas created and tested over time, they may assess contemporary issues and suggest solutions (Peng et al., 2020). Interim managers can learn from prior strategies that have achieved success and work to incorporate them into a coherent framework of contemporary management practices (Peng et al., 2020). This is how this article reveals solutions that can help improve the situation of the Arena.
Organizational objectives are fundamental to the execution of corporate management. Peng et al. (2020) state that an organization’s existence and ongoing growth are based on its business goals. Organizational management may successfully coordinate different information and resources inside the company, increase managerial efficiency, and accomplish the organization’s objectives (Peng et al., 2020). The interaction between people inside the company is coordinated as a result of the whole management process, which is a dynamic coordination process. Additionally, it contains interaction between people and substances in the organization (Peng et al., 2020). This approach helps to revise the structure of the organizational structure of the company under study.
On the other hand, there are certain elements that can slow down the development of the company. Thus, Sandhu & Kulik (2019) argue that understanding how organizational structure affects the management discretion available to role incumbents when new roles form in companies is crucial. Organizational designers are driven to establish a formal framework that controls and restrains role-holder’s conduct (Sandhu & Kulik, 2019). The goal of that formal structure is to enable a variety of positions to be filled by individuals with potentially conflicting interests while achieving organizational goals (Sandhu & Kulik, 2019). However, it is challenging to develop and enforce these formal frameworks. In order to apply them efficiently, the theoretical framework of human resource management is necessary.
The issue of staff diversity is not new to industrial businesses. Ali et al. (2020) explain that diversity refers to distinctions that are either more obvious, like those related to gender, age, and ethnicity, or less obvious, such as those related to employment history or level of education. Numerous writers have addressed the subject of diversity, and their study has demonstrated that diversity may have both beneficial (improved collaboration and better communication) and adverse effects, such as disputes (Ali et al., 2020). Diversity management refers to organizational strategies that try to integrate more people from diverse backgrounds within the framework of company goals (Ali et al., 2020). Organizations should discover practical ways to implement diversity management (DM) policies to develop a creative enterprise that may enhance their operations, goods, and services.
Utilizing the concepts of sustainable human resource management is one method for handling the conflicts that arise from the employees. According to Pellegrini et al. (2018), there are two methods to define sustainability in the context of human resource management. To assist in executing a sustainable plan and development, the company must transform its personnel management in every possible way (Pellegrini et al., 2018). This perspective emphasizes human resource management’s role in creating sustainable organizations on all three of these fronts (Pellegrini et al., 2018). This decision may contribute to revising the structural organization of personnel in the Arena company.
It is also worth considering other features that contribute to creating a proper management atmosphere in the organization. VraĹakovĂĄ et al. (2021) complement the second method of sustainable employment and sustainable human resource management. Sustainable management of human resources primarily focuses on the interaction between policies and practices (VraĹakovĂĄ et al., 2021). Both of them should be incorporated and promote the right to equality, non-discrimination treatment, continuous learning, career growth, a democratic workplace environment, employee engagement, and equal chances for everyone (VraĹakovĂĄ et al., 2021). Thus, the article demonstrates that equal opportunities for all organization members can significantly improve its performance.
Furthermore, human resources are seen as the strategic value for any organization, and sustainable human resource management emphasizes the significance of people. Gomez & Bernet (2019) mention that sustainable human resource management traits are long-term thinking, employee care, environmental protection, revenue growth, workforce involvement, and social dialogue. In addition, the characteristics of employee development, partnership, flexibility, adherence to labor laws, employee collaboration, fairness, and equality are attributable to sustainable HRM. Although there are many ways to define equality, age and gender equality are the two that are most frequently used. Through age management, sustainable human resource management allows businesses to utilize the potential of workers of all ages (VraakovĂĄ et al., 2021). Age management makes it simpler to exploit the strengths and potential of each generation by recognizing their age, which brings varying degrees of abilities, education, experience, or different life stages.
The importance of diversity in the strategic development of the company is immense as it impacts performance outcomes such as revenue. According to Norbash & Kadom (2020), companies with racial and ethnic diversity in the top quartile are 35% more likely to achieve financial performance that is above average. For companies with gender diversity, the likelihood is increased by 15% to outperform median financial performance (Norbash & Kadom, 2020). This might be explained by a stronger sense of belonging and a conviction that a firm that prioritizes its people would have more employee engagement (Norbash & Kadom, 2020). Nevertheless, the difficulties faced by Arena Solutions are not limited to the promotion of diversity.
Arena HRM
Arena Solutions is the company that recently underwent a merging deal with PTC. PTC (2022) acquired the company for over 700 million dollars, but its performance was unreliable. Perhaps the managerial approach of PTC towards Arena Solutions led to the current predisposition of the company to mislead, shaping the employees’ behavior. However, the company is maintained purely on employees’ personal ability to cooperate and work. The merit-based system and equality treat of each employee does not stimulate the collaboration that Arena wants to promote. The company suffers from an overly individualized workforce and needs to revise its internal structure to increase current profits and decrease expenditures on operations management.
In Arena Solutions, managers perceive their behavior shaping techniques as successful guidance towards a sustainable work environment. However, in practice, the company operates purely on individualizing each employee’s capabilities and pays little attention to alignment with the company’s goals and mission. Employees work based on an instinctive level with some guidance from the managers to navigate through the company’s internal processes. Therefore, the company is dependent on its employees and requires an intervention to target the development of this segment.
The organization’s managers must picture the kind of employee behavior they wish to promote. Since workers have free will and a spirit, it needs careful planning to develop them into people who will flourish and perform effectively in the company (Galli, 2018). Arena Solutions is able to prosper and endure in a time when businesses are closing their doors because of the team spirit and employee conduct that has been fostered by hard work and devotion. The company needs to establish the proper infrastructure to produce productive personnel.
To a certain extent, Arena Solutions faces the problem that management has no idea how to manage employees effectively. Consequently, managers do not understand that the effectiveness of an organization depends entirely on how much employees are involved in the leadership process. A significant personnel turnover drains the organization: there are few people left in it who have professional experience and are ready to share it with young specialists (Klein et al., 2022). Team leaders should not engage in micromanagement â the employee should give it to stimulate their independence and responsibility (Petkoski & Jakovlev, 2022). Empowerment will give an opportunity to employees to make their own decisions (Taylor, 2022). The organization must understand that employees have interrelated personal and professional goals. Employees who do not see career opportunities in the company will noticeably reduce their motivation.
Employees want their work to be challenging and skilled. They want to perform tasks that use their strengths and have opportunities to move up the career ladder. The organization’s managers and HR employees need to correlate talents with the roles that motivate employees to want to get (Kim, 2021). The personal qualities of leaders and team relationships are essential for team interaction (Petkoski & Jakovlev, 2022). Employees want to work with leaders and teams that put people first, value people’s contributions, and demonstrate decency. Each person in the organization influences the involvement of other employees with their attitude to business, people, and teamwork.
The Arena management is experiencing several difficulties with not understanding how to use its employees most effectively. This is necessary for the organizational structure to be streamlined and more consistent. After all, the effectiveness of Arena’s business depends on how much employees allow development. To develop a business in the right direction, learning how to manage human resources is essential (Galli, 2018). Without dedicated employees, the organization will not be able to achieve high performance. The goals of each manager should sound in unison with goals, and each employee’s tasks should be directly or at least indirectly related to the tasks of the entire organization (Kim, 2021). Thus, the main problem is combining strong leadership and strong management and using each mechanism’s advantages to compensate for the shortcomings of the other (Taylor, 2022). Arena management should be aware that achieving the goals depends on understanding the situation within the team. Employees should have great opportunities, allowing the company and management to appreciate them and interact productively.
Recommendations
The company may require reevaluation of managerial influence on employees’ behavior as the organizational goals are not met in this aspect. Therefore, the suggestion in the form of employee exchange is proposed. Such connections are standard in social interactions and identifying the rules that govern how employees exchange resources with their companies, managers, and coworkers may help better understand a range of organizational behaviors and forecast the outcomes of those behaviors (Mendryk, 2020). It is possible that PTC could share its successful managerial experience and assist its subsidiary in the form of Arena Solution by employee exchange as a way to promote a switch in employee behavior. However, since the acquisition, it might be necessary to focus on other ways to instill the required alignment of employee behavior and company goals.
Sustainable Human resource management (HRM) seems to provide essential benefits in employee management and aligning behavior with organizational goals. Therefore, the company is recommended to follow essential characteristics of sustainable HRM to promote valuable development (Kim, 2021). Moreover, it might be that with the implementation of sustainable HRM, the company would be able to change employee perception and acquire a particular character that would support or positively affect them.
Conclusion
Arena Solutions is a company highly focused on producing effective services without transparent evaluation of its employee performance. The company is dependent on the effectiveness of 170 employees after the recent acquisition by PTC. Consequently, there is a dissonance between the company’s employees and organizational goals. Perhaps, the acquisition process resulted in the disruption of the company’s performance, but it is evident that the company is underperforming overall. The effectiveness of its operations is entirely dependent on the current employees as they perform significant customer maintenance and attraction duties.
The company must diversify various aspects of its business to continue successful operations. Consequently, recruiting new employees with the diversity policies prepared beforehand may improve the situation. The company might be able to improve its organizational goals by training new employees that are better suited for their current positions. At the same time, the company may reform its employment segment to create detailed job positions that will reflect its goals, aims, and mission. Consequently, organizational unity will be restored, and a diverse and highly competent workforce will allow the company to progress beyond its previous heights.
References
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