Key Concepts in HRM A2 PDF

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Key Concepts in Human Resource Management (BUSM4588)

Assessment 2: Essay Due: November 29th, 2020

Jade Frankland s3717833

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Table Of Contents Introduction

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External Organisation Analysis

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HRM Recommendations

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HRM Conclusion

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Reflection

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Appendix

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Reference List

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Introduction JimmyRum is Victoria’s first award winning dedicated Rum distillery, based in Dromana on the beautiful Mornington Peninsula, JimmyRum provides a unique drinking experience with multiple rum tasting options provided by the ‘Chief Ideas Man’ (JimmyRum., 2020) James McPherson, and a luxury warehouse style cocktail bar with 30+ cocktails on the menu. JimmyRum offers a variety of different Rum types, distilled on site and imported from around the world, as well as a personal pre-made cocktail delivery experience; this has allowed JimmyRum to adapt to the current COVID-19 pandemic and the restrictions placed on hospitality venues. Rum is not a typically popular spirit, in comparison to the boom of the Gin market and the consistency of the Vodka market, however JimmyRum’s aim is to provide an invaluable education on Rum spirits; specifically how different Rum types are distilled, how to correctly drink the spirit, and general unknown information on Rum and how the spirit has developed over thousands of years (JimmyRum, 2020).

External Organisation Analysis As Victoria’s first and only dedicated Rum distillery, there are very few Craft Rum Distillery competitors within the Victorian market, however as most spirit drinkers are undereducated in the processes of distilling Rum, most drinkers find Rum and Whiskey to be of a similar nature (McCathy, L., 2020). Due to this generalised viewpoint, JimmyRum’s main competitors within the Victorian Craft Distillery market are Starward and Chief & Sons Whiskey, both Whiskey brands are high quality, and provide educational tasting sessions within each distillery.

Shifting into a national market is an aspiration of JimmyRums’, and with their products already being showcased at Melbourne Domestic Airport for tastings and bottle sales, the distillery is on its way to becoming a nationally accredited Craft Rum Distillery. Although JimmyRum has not yet developed into the national market for Rum spirits, there are other Rum distilleries all around Australia which offer their products within the Victorian market; such as Beenleigh Artisan Distillers (based in Queensland), Brix Distillers (based in New South Wales), Husk Distillers

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(based in New South Wales), Adelaide Hills Distillery (based in South Australia) and Lark Distillery (based in Tasmania) (Rum Revolution | Australia’s Best Rum Distilleries, 2020). Each of these competitors provide tasting options within their distillery venues, however only Beenleigh Artisan Distillers and Brix Distillers are dedicated Rum distilleries; both with the aim of educating their customers on the advancements of rum and how to sense and enjoy the different flavours within their products.

Beenleigh Artisan Distillers are based in Brisbane, Queensland, producing a wide variety of different products, including Honey Rum Liqueur, 10 Year Old Rum, Craft Canned Premix beverages and 3 Year Old White Rum; each of the products are available Australia-wide, this ensuring Beenleigh’s products are available to a wide range of different consumers (Beenleigh Rum, 2020). By offering products nationally, it allows Beenleigh to extend its consumer reach, however limits the educational factors which are a primary focus within the Queensland Distillery. Beenleigh is similar to JimmyRum in the fact that both distilleries offer their cocktail recipes online, as to encourage customers to create their own at home concoction, but this also allows both distilleries to be transparent with their consumers and what the distilleries have to offer.

Brix Distillery is based in Sydney, New South Wales uses all naturally Australian ingredients within their extensive range of products available nationwide. Offering products such as Distilled Syrups, Premixed cocktails, branded clothing apparel, Spiced Rums, White & Gold Rums (Brix Distillers, 2019). Similar to JimmyRum, Brix Distillery offers a small range of branded clothing and accessory garments, these products are invaluable as a marketing tool as they allow the garment wearers a comfortable piece of clothing, all whilst generating word of mouth marketing.

The Craft Rum market within Australia is limited, however is ever evolving with the assistance of all Craft Rum distilleries, creating a community of respected distilleries. Each Craft Rum Distillery offers new techniques, products and experiences; all whilst honoring the original craftsmanship in Rum distilling. Many different distilleries compete in creating premium aged Craft Rum products (Buxton-Collins, A., 2020), however the current trend in the Australian Craft Rum industry is the creation of premixed and post mix packaged products (Jackson 2020),

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such as ready to mix cocktail packages. This is a relatively new area of this industry, and there has certainly been a competition between the different distilleries and their released products (Appendix i).

JimmyRum has a variety of different stakeholders; including all employees, product suppliers, collaborative businesses, customers, product retailers, local counsel and business creditors. Goodpaster (1991) suggests that each stakeholder has a vested interest in the business and an aim of assisting with the longevity of the business. JimmyRum employees are rewarded with a 15% off (all products and services) friends and family discount, as well as free products in an ad hoc style, this encourages staff to consume the products created at the distillery; allowing staff to understand the product which they sell and serve. Hughes (2002) specifies that the best HRM practices involve an organisation being a pay or benefits leader, as JimmyRum provides pay at standard award rates, it is ideal for JimmyRum to encourage staff to work at a more optimal rate to receive benefits such as free products or discounting. He, Morrison and Zhang (2019) suggest that by encouraging staff with benefits, it allows staff to aim towards achieving a specific outcome; specific to JimmyRum’s case an incentive could be a specific cellar door/ bottle sales amount, or the upselling of a cocktail selection.

HRM Recommendations The Human Resource Management Department of JimmyRum is rather basic as the business is very new and not as large as its competitors venues, however all staff are encouraged to discuss any issues they may have in an honest and open method, this is easily achieved as all employees know each other quite well and there is no malice between staff. This open communication policy is very beneficial as all employees feel valued in their opinions and all issues are discussed with the Venue Manager, this allows actions and decision mankind to be a very streamlined process with a minimal time period for effect to take place. Having a minor Human Resource Management Department is well suited for JimmyRum, as there are very few actions required to occur for change to be enforced, this is largely due to the limited staffing; however this streamlined process is also a hindrance on future HRM efforts. The limited HRM department

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at JimmyRum is not a viable option for the future of the business as there are a lot of different skills required in a Human Resource Management role, the current HRM issues at JimmyRum include:

● Limited staffing ● Rotating management due to limited role requirement transparency ● Limited cellar door/ bottle sales incentives ● Limited opportunities to advance within the business ● Unclear staff responsibilities By using their workplace knowledge and degree skills, each of the specified issues at JimmyRum can be resolved with a dedicated Human Resource Manager, specifically by enforcing definitive role responsibilities and increasing allocated recruitment spend to increase higher quality employee candidates; this in turn will reduce employee turnover (Jamali, El Dirani and Harwood, 2015).

JimmyRum is unfortunately facing a decline in employee retention, as staff are typically hired on a casual agreement with high job flexibility, however the expectations of JimmyRum management is for all staff to be available to assist on weekend days and nights. However, due to the casual wage agreement, casual staff have the flexibility to pick and choose their own availability, unfortunately if this availability does not match the required working availability for JimmyRum, the employment is typically terminated. Although there is a high level of employee turnover, within the Harvard HRM Model it is found that a dedicated Human Resource Management Department can have a large ‘impact upon employee turnover’ (Law et al. 2011, pg. 503) , aiding in setting out all expectations from the beginning of a person's employment with JimmyRum, this allows the employee to understand what is expected of them, at this stage the new staff member can determine if the role is a good fit for themself.

Once a Human Resource Management Department is properly embedded within the business, the HRM should focus on the current issues faced within the business, such as employee dissatisfaction and employee turnover, but should also explore the addition of other HRM

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activities; such as incentive opportunities, skill developments and the creation of a performance management plan to ensure all staff are performing at an optimal level whilst ensuring staff are happy within their roles. To optimise the effectiveness of a HRM role, JimmyRum should ensure recruitment marketing budgets are set as to hire quality employees for each role advertised. Law et al (2011) ascertains that training and skills development is a vital component of a successful HRM within any hospitality business, stressing importance on the ‘development of continuance commitment’ (Shahnawaz and Juyal 2006). Shahnawaz and Juyal (2006) support workplace training and skill development, as this is an accepted form of ‘ developing commitment and trust’ within an organisation, this mentality is widely accepted and allows a business’s employees to feel valued and respected.

HRM Conclusion

JimmyRum is a developing business with the potential to expand to international sales, once national sales has been explored. With the expansion of JimmyRum, the brand has the potential to also expand its Human Resources Management Department, this is the specific hiring of a dedicated Human Resource Manager to oversee all employment directives, employee issue resolutions, staffing additions and employment contracts. It is more beneficial for JimmyRum to employee a Human Resource Manager to work alongside the established Venue Manager, as opposed to the Venue Manager absorbing all responsibilities; this shift allows the Venue Manager to focus on the JimmyRum brand, cellar door/ bottle sales, stockist opportunities and the general management of the JimmyRum cocktail bar venue. The potential Human Resource Manager at JimmyRum will be responsible for recruitment, employee skill development, HRM planning, performance management, function evaluation, rewards and incentives, employee participation and communication, employee wellbeing and administrative responsibilities; by utilising a Human Resource Manager within this business it will allow for a more well-established management (Van Vulpen, 2020).

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Reflection This assessment has allowed me to better understand the organisation in which I am casually employed as a Cocktail Bartender, I am able to understand the need for a Human Resource Management Department, as well as the need for a more attentive and aggressive recruitment process, as the current employment system is rather flawed. The addition of a dedicated Human Resources Manager will allow the Venue Manager to redirect more time and efforts into the development of the JimmyRum brand. By analysing the current External Situation of JimmyRum, I was able to ascertain that the Victorian competition of JimmyRum is rather small which allows JimmyRum to thrive; however a more national focus on product sales could immensely increase JimmyRum’s marketing and branding activities, making the products produced more sought after and the cocktail bar venue a destination for national travellers.

By analysing the business which I am employed at, it has allowed me to evaluate the business from a more in depth perspective, as well as allowing me to view the organisation from another context. This assessment has allowed me to critically analyse JimmyRum’s and understand how the business operates, providing me with valuable and relevant industry knowledge, as well as the ability to apply this knowledge within my role in the business.

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Appendix Appendix i)

(Brix Distillery, NSW - Mix-Your-Own Espresso Martini Pack)

Appendix i (continued)

(JimmyRum At Home Cocktail Kit)

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Appendix i (continued)

(JimmyRum Cocktail Bottles)

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Reference List Beenleigh Rum. (2020). Our Rum. [online] Available at: https://www.beenleighrum.com.au/our-rum/#alchemy [Accessed 23 Nov. 2020]. Brix Distillers. (2019). Shop. [online] Available at: https://www.brixdistillers.com/shop [Accessed 23 Nov. 2020].

Buxton-Collins, A. (2020). HOW RUM DISTILLERS ARE REINVENTING AUSTRALIA’S OLDEST SPIRIT. [online] The Upsider. Available at: https://theupsider.com.au/australian-rum-distillers-reinvention/21099 [Accessed 21 Nov. 2020].

Goodpaster, K.E., 1991. Business ethics and stakeholder analysis. Business ethics quarterly, pp.53-73.

He, J., Morrison, A.M. and Zhang, H., 2019. Improving millennial employee well-being and task performance in the hospitality industry: The interactive effects of HRM and responsible leadership. Sustainability, 11(16), p.4410.

Hughes, J.M.C., 2002. HRM and universalism: is there one best way?. International Journal of Contemporary Hospitality Management.

Jackson, D. (2020). Cocktails at Home: A Revolution. [online] National Liquor News. Available at: https://www.theshout.com.au/national-liquor-news/cocktails-at-home-a-revolution/ [Accessed 22 Nov. 2020].

Jamali, D.R., El Dirani, A.M. and Harwood, I.A., 2015. Exploring human resource management roles in corporate social responsibility: The CSR‐HRM co‐creation model. Business Ethics: A European Review, 24(2), pp.125-143.

JimmyRum., 2020. Our Story. [online] Available at: https://jimmyrum.com.au/jimmyrum-story/ [Accessed 23 Nov. 2020].

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Law, R., Bai, B., Davidson, M.C., McPhail, R. and Barry, S., 2011. Hospitality HRM: past, present and the future. International Journal of Contemporary Hospitality Management.

McCathy, L. (2020). Review: the golden age – rum and brandy from Australia’s top whisky makers. [online] OZ Whiskey Review. Available at: https://ozwhiskyreview.com.au/review-the-golden-age-rum-and-brandy-from-australias-top-whis ky-makers/ [Accessed 21 Nov. 2020].

Sally (2020). Rum Revolution | Australia’s Best Rum Distilleries. [online] Alluxia. Available at: https://www.alluxia.com/blog/rum-revolution-australias-best-rum-distilleries [Accessed 26 Nov. 2020].

Shahnawaz, M.G. and Juyal, R.C., 2006. Human resource management practices and organizational commitment in different organizations. Journal of the Indian Academy of Applied Psychology, 32(3), pp.171-178. Van Vulpen, E. (2020). The 12 Key Functions of Human Resources. [online] AIHR Digital. Available at: https://www.digitalhrtech.com/human-resources-functions/ [Accessed 27 Nov. 2020].

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