BSBHRM 501

Assignment

Requirements and Recommendations

Rabi Katwal
02132433
 Report on HR requirements and recommendations

Executive Summary

The JKL industries will reposition itself to focus solely on retail sales and service and
exit the rentals market in which forces such as competition and consumer choice reduce
potential profitability.In accordance with the organization’s values, JKL intends to (to the
extent feasible) recruit from within the company and upskill or reskill existing employees
in rentals who wish to remain with the company.

The organization is currently using a HR business partner model with a human

resources officer aligned to each of the three key business areas: Sales, fleet rentals,
and service.The current management team has little understanding of industrial
relations matters and has been appointed to their current positions based on their
abilities in sales or their technical skills.

Introduction:

JKL Industries is an Australian owned company, selling forklifts, small trucks and spare
parts to industry. They also have a division which leases forklifts and small trucks. The
company’s head office is in Sydney and JKL has branches in Brisbane, Melbourne,
Perth, Adelaide and Canberra.After 12 years in business, focusing on forklifts and small
trucks, JKL has been offered the sales rights to a range of medium and large trucks
from an overseas supplier. This opportunity will provide JKL with an advantage in range
over its competitors.

The company will reposition itself to focus solely on retail sales and service and exit the
rentals market in which forces such as competition and consumer choice reduce
potential profitability.In accordance with the organization’s values, JKL intends to (to the
extent feasible) recruit from within the company and upskill or reskill existing employees
in rentals who wish to remain with the company.
Analysis of business documentation

Mission of JKL
JKL Industries is an Australian owned company selling forklifts, small trucks and spare
parts to industry. We deliver value to customers and investors through our highly
trained, motivated, and expert workforce.

Vision of JKL
JKL Industries believes in developing and unlocking the potential of its people to allow
the company to become the leading supplier of forklifts, small, medium and large trucks
in Australia.

Values of JKL

● Performance excellence

● Value for investors, customers and employees

● Personal and professional development

● Diversity

● Sustainability.

Human Resource of JKL

The organization is currently using a HR business partner model with a human

resources officer aligned to each of the three key business areas: Sales, fleet rentals,
and service.

In each of the state-based sites there is a branch office consisting of an office building,
warehouse, service department and sales office. The Human Resources Officers
(Business Partners) report to both the HR Manager at Head Office and their respective
managers in the branches.
Consultation with internal stakeholders

The current management team has little understanding of industrial relations matters
and has been appointed to their current positions based on their abilities in sales or their
technical skills.

The HR officers have experience in understanding and interpreting Australian

Workplace Agreements from an administrative perspective. They have limited
knowledge of strategic management and have little control over or influence in
implementing industrial relations policy. As they report directly to the Division Manager,
they are functioning more as administration assistants than as a strategic HR resource.

Employees have heard rumors of the forthcoming changes in the structure of the
organization and the move into medium and large truck sales. There are concerns
about possible redundancies but no information from management has been
forthcoming.
Consultation with internal employees also has been done and SWOT analysis has been
performed. In terms of strength JKL has strong distribution system and performance
development program. And lack of training on physical equipment handling and
enforcement of anti-discrimination are considered as weaknesses. Threats are
considered as economic growth slows down to whole sale market and the new
opportunity has arisen as in the vehicle rental market. Now JKL is moving into this rental
business.

There has been a history of dissatisfaction within the organization relating to pay and
conditions with some employees complaining they are not receiving the entitlements
they should be.

Review of external business environment

After 12 years in business, focusing on forklifts and small trucks, JKL has been offered
the sales rights to a range of medium and large trucks from an overseas supplier. This
opportunity will provide JKL with an advantage in range over its competitors.
PEST analysis was done in regard to the situation of JKL. Political issues are quite
stable in the rental market of the vehicle as no new laws are not enacted recently that
can affect the business activity of JKL. In regard to the economic issues, JKL is
experiencing 10% decline in its current Vehicle selling business and that’s why its
moving into promising new rental business. Technological development will help JKL to
manage its human resource services more effectively due the invention of 5G networks
and development of new security system installation.

Sales results over the past five years have indicated strong growth in forklift and truck
sales which have averaged 10% sales growth per annum. The rental market has been
in decline for the past three years due to the reduced costs of these vehicles and some
taxation benefits to industries who purchase these vehicles.

Taking the sales opportunity will, however entail some significant changes, including
significant changes to the current organizational structure. The company will reposition
itself to focus solely on retail sales and service and exit the rentals market in which
forces such as competition and consumer choice reduce potential profitability.

Two options to meet human resources needs and associated risks

HR will have a key role to play in the implementation of strategic and operational
changes. The significant changes to the organization also provide an opportunity for HR
to potentially restructure and certainly rethink how it delivers services to internal clients.
HR will need to consider company strategic directions, the external business
environment, and the needs of employees and managers to implement the strategy
effectively.

Outsourcing basic HR Services:

JKL can outsource its basic HR services. The expected cost of it would be $600,000.
And financial gain through efficiencies, savings or direct revenue would be $ 800,000 for
the following financial year. However, the chances of failure or likelihood of risk is 10%
which is considered as low.
And the associated external risks involved in this option are labor market skills
shortages, slow economic growth and uncertainty in environmental regulatory
environment. During this outsourcing of HR services JKL might face shortage of skilled
labor which may also be the result of slow economic growth. As JKL mentioned that
they are also moving out from their current rental business entering into retail sales
market. Additionally, external environmental factors are uncertain and cannot be
controlled by JKL which also poses risks to some extent.

Enhance HR services with respect to industrial relation:

JKL can enhance its HR services with respect to industrial relation. A review of
Industrial relation of JKL indicated many issues in this area. To resolve these issues
JKL can implement strategies to improve its industrial relation. The expected cost of it
would be $150,000. And financial gain through efficiencies, savings or direct revenue
would be $ 500,000 for the following financial year. However, the chances of failure or
likelihood of risk is 20% which is also considered as low.

And the associated external risks to this option are business confidence, slow economic
growth and uncertain regulatory environment factors. Due to low ROI of this option, it
might not be that attractive and lead to low business confidence. On the other hand, the
slow economic growth explained in the previous option can also hamper the
effectiveness of this option. Additionally, the inevitable uncertain external environmental
factors are always there to cause this option a risky investment.

ROI Calculation for the options:

ROI (Return of Investment) – ROI allows the organization to quantify and compare the
relative value to organizations of different approaches and options.

ROI = (Investment Revenue – Investment Cost) / Investment Cost

Outsourcing HR

Basic ROI = (800,000 – 600,000) / 600,000 *100 = 33%

ROI = (Gain Cost) 100 %

= (800,000 (0.90) -600,000) / 600,000 * 100%

= 20%

Restructuring HR

Basic ROI= (1,000,000-800,000)/ 800,000* 100%= 25 %

ROI = (1,000,000(0.80)- 800,000) /800,000 100 %
= 0%

Retraining Rental Employees

Basic ROI= (300,000-500,000)/ 500,000 *100=500%
ROI= (300,000 (.70)-500,000)/ 500,000 100%
=320%

Integrating HR Services
Basic ROI= (15,000,000-100,000) / 100,000 *100 = 1400 %

ROI=(15,000,000 (0.90) 100,000)/100,000 * 100%

=1250 %

Enhancing HR Service with Performance Management

Basic ROI =(1,000,000-100,000)/ 100,000 *100= 900%

ROI= (1,000,000 (0.90)-100,000)/ 100,000*100%

=800%
Enhancing HR Service with Industrial Relations
Basic ROI= (500,000-150,000)/ 150,000-=233.33 %
ROI= (500,000 (-80)- 150,000) 150,000
=166.67 %
In the above ROI, it can be clearly seen that, whichever had a 10% risk, is the best
option to dofollow in organization.
Recommendations to meet HR needs:

 Providing clear industrial relation policy to meet long tern industrial relation
objectives
 Develop and provide proper grievance policy to follow by employees in case of
disputes
 Information sessions to boost morals of employees as they have been reported
to be fluctuated at times in the workplace
 Providing assurance on faire pay scale
 Organizing programs to enhance employee’s technical skills
 Organizing awareness and information session on understanding of Australian
Workplace agreement as employees demonstrated limited understanding on this.
 Providing written copies of policies, procedures and company values to review
and stay up to date.
 Proper training to avoid chemical hazards and physical injuries
 Implementation of Anti-discrimination and Sex Act.
 Implementation of sexual or any sort of harassment policy and Acts


HR strategies in accordance with diversity and anti-discrimination policy:

JKL Industries values the diversity of its team, clients and communities and respects the
rights of individuals and groups to operate in an environment free of discrimination.

Access and equity (diversity and anti-discrimination) is fundamental to the operations of

JKL.It is embedded in policies, practices and forward planning.

JKL recognizes the importance of diversity in achieving our vision.

JKL understands the business environment and actively assists customers to reach
their optimum potential. Our primary objective is to be solution-oriented and focused on
customer needs. JKL recognizes that valuing diversity is pivotal to achieving its vision.
A welcoming, supportive environment will be provided leading to positive learning and
employment, and individuals having the opportunity to reach their optimum potential.

At JKL, anyone engaged in employment or the provision or receipt of training and/or

services has the right to operate in an environment that is free from discrimination on
the grounds of:

“age; breastfeeding; disability; industrial activity; lawful sexual activity; marital

status; physical features; political belief or activity; pregnancy; race; religious belief
or activity; sex; gender identity; sexual orientation; parental or carer
status;employment activity; or personal association with any individuals with these
characteristics.”

Review of existing industrial relations:

JKL Industries has not had a clear industrial relations policy or strategies in the past.
There has been a tendency to manage issues on an ad hoc basis rather than drive the
business through long-term industrial relations objectives.

Responsibility for industrial relations issues has been spread between various levels of
management including the Operations Manager, Sales Manager, Service Manager and
Human Resources Officers for each branch. This has led to issues of inconsistency and
allegations of unfair work practices, with team members confused as to their
entitlements and unsure of how to resolve grievances and conflict appropriately.

On several occasions the union has become involved in disputes when team members
have been unable to resolve issues with their line managers.

The current management team has little understanding of industrial relations matters
and has been appointed to their current positions based on their abilities in sales or their
technical skills.
Conclusion:

The company will reposition itself to focus solely on retail sales and service and exit the
rentals market in which forces such as competition and consumer choice reduce
potential profitability.HR service delivery of the operation manager was quite
satisfactory throughout all relevant departments and sectors. Although some issues in
industrial relation have been identified, some recommendations were prospered to
resolve those issues. Additionally, some strategies were also recommended to facilitate
the process.