Executive summary (200 words)
Tables of content
About the Topic
About the project
Overview of the company:
Challenges faces by company
Impact on the role of HRM
Over the few years there is few up and downs in the aviation sector. There are many challenges that are facing by the companies, as there is a healthy competition is going on between the airlines, so the profit of the company effects by these factors, like the amount of people travelling on their fleets as well as the promotion that are effecting the customers mind. Aviation industries are now catching up the profit margin. Many companies are offering many services to the customers to catch as many as customers. There are competitions on the side of members to. What are the challenges that the HRM is facing towards the company’s growth as well as the retentions of the employees. This project will provide a proper understanding of the problems and the issues of the employees and how the HRM plans according to the companies and how many challenges that they have to face. What will be the role of the HRM in the organization?
About the Company
The renowned aviation company Deutsche Lufthansa, which is commonly known as The Lufthansa group is operating worldwide. It is the largest airline in the terms of passenger counting as well as the fleet size. In this company, government has a total stake of 35.68 until 1997. However, the private investors around 88.52% owned it all. The Lufthansa group can be term as the fourth largest airline in the world. The Lufthansa group started in the year 1920s and it is a German company. On that time, the company only provides the cargo shipment that is only for the Mailbags and parcel. The competitions were too high on that time as many airline companies were operating the same business like the Lufthansa. However, after so much competition only two have survived, the companies are Deutscher Aero Lloyd and another one is Junkers Luftverkehr. They both has joined hands and found “Deutsche Luft Hansa AG” on the year 1926. In the year 2017, the Lufthansa has generated revenue of around 35.6 BN Euro, which has increased by 12.4 %, compared to previous year just because of their policies as well as the management. Moreover, the average staffs that were employed were around 128856, which is significantly a huge number. They have chosen the concept of three pillars and organised their business segments. On the year 1950s, they completed the millionth customer since it was started which is a huge achievement.
Problems faced by the company
In the year 1940s when the war is on and government asked Lufthansa to provide, services like to transport people as well as to perform the technical operations, they need to handle and transport some Secret reports. However, they have done it. The business was expanding in the year 1973 to 79 but it was also followed by the crisis. In the same year the prices of kerosene exploding. Moreover, they have to build more fuel-efficient jets. They have performed well in the year 2011, But it was lower than the previous year the prices of the jet fuel was high of all time and there are numerous external factors that they are facing, such as the Arab region and Africa as well as in the Europe debt crisis, and the natural disaster over Japan. The company has faced the longest strikes from the employees in the history of the German airline in the year 2015, in which they have to cancel around 4,679 flights all over the world and around 22% in total. It reported that the strikes rooted to the management that led by the Carsten Spohr, the chief executive, for its change in the efficiency of the group. Moreover, the same strike started on the 2016 pilots were demanding 22 percent salary hike. And there were many aircraft crashes which is faced by the company as any crash will led the company’ image down.
Impact on the Roles of Human Resource Management
Over the years, the human resource has changed remarkably. On the first, it was all the clerical work but later on HRM has also joined in the business strategies and now without the HR functions no company could become successful. As we are here in this millennium, there are several challenges for the HR department around the world, which puts questions on the nature of the practices/activities that is perform by the HR professional. Moreover, involve new approaches for the function of HR in service delivery.
Conflicts with the Company: – There are many conflicts between the staff and the management over several issues that need to solve by the HRM to run the smooth operations. HRM helps to prevent these conflicts in future as well.
Problems of the HRM at the starting : – At the starting in 1940s there are war going on so the staffing also got affected as the war broke out many people went to the army as well as social services, so the employees were much less for recruitment.
Retentions and hiring: – As the new companies emerges at the point of time they have attracted many of the core employees of the group the retention is very much crucial for the company and there were many cost cutting going on the phase of fuel price hike. It was very hard for the management to hold the employees to change the job. However, in some cases hiring is also important for the company, as they need new talents. Lufthansa has hired new people in several years they have attracted qualified new staff and fulfilled their commitment in their existing employees. At last, they have overcome such strikes with help of HRM.
Source: – annual report Lufthansa 2017
Balance between the Management and the employees:- Human resource management faced their biggest challenge as many of the employees went on strike because of their wages and cost cutting the by management, HRM has to maintain the balance between the management as employees.
Trust in the employees:- Plane crashes will affect the business of the company as well as the employees just like the crash of Germanwings in the year 2015, which questioned as the suicidal. These things will influence on the Human Resource Management as they questioned about their recruitment as well as the people will questioned about the safety.
(a)The external business environment that affects the HRM function: –
In Human Resource Management, many factors affect their operations. Moreover, it is necessary to adapt new things very fast as the things in the operations or cooperate polices changed in with immediate effect.
1. New Government Regulations in business: – the human resource is always in the immense pressure as the new polices of government can be applied any time and they have to work within the law. All the new policies that are include in the work can influence the entire Human Resource department like hiring the employees, their training, termination as well. If the company not follow these rules and regulations then it will lead the company to shut down its business.
2. Economic conditions: – in the year 2015 as well as 2016 there was several strikes that happened just because of the cost cutting that the Lufthansa has done to avoid losses. Human resource Department also hampered; as they cannot able hire new talents to the company. Economic conditions o the world is the biggest external influence on the management.
3. Technical’s advancement: – new technologies helps human to become more reliable on the machines. New techniques help the HR department to cut down and save their money. That means they have to cut down few people to one single person from the system. These new technologies help the company to gain more profit as before because of the less amount of money now they have investing.
(b)Carrier progression within the organisation: –
Carrier progression depends on the two parties that are individual and the organization. The person or the employee is responsible for his growth or development in his life or the sector he is working, and the organisation is involved in planning as well as the development of career that helps to improve the environment of the organization.
• Individual responsibility: – according to the theory and the management career planning depends on the individual skills and his need and aspiration. Is the employee is prepare and work hard enough then the member is will get his possible promotion.
• Organizational responsibility: – in an organisation, HRM always plans to attract, develop and maintain the current staff. The organization always wants to keep the best employee. If the HRM does not support or strengthen the career of its employees then they cannot achieve the expected results.
As per the report of Lufthansa 2007, it has seen that the company look for its employees as they say those employees are the key member of the organization. This is why they motivate and provide best training; these are the prime objective of the company’s Human Resource policy. They always hire highly qualified new talents and retain them with good performance related pay. Moreover, provide good career opportunities.
(C) Role of HR in recruitment of managers: –
The recruitment process in an organization or for the HRM is very important, it need a proper planning. Recruitment can defined as a way of selecting a person from the lake of the qualified candidates. The HRM will firstly plan what they need mean they will make proper staffing plans and how many employee they need. HRM have to understand the factors that are affecting for recruiting people. Based on the information whenever their will be the job openings HRM professionals will start the recruiting process.
• First, while hiring managers they will do the job analysis and they will look for the internal candidates who are qualified for the post. An internal candidate means those employees who are already working with the company. If the internal candidates meet the criteria for the job then that person or employee will be encourage to apply for that post. Then job opening may not publish.
• If any person who is not meets up the criteria within the organization then they look into the outside world for hiring. If the HRM wants candidate in short period of time then the HRM will collect some resume and ask the candidates to come over. Then the group of people will come to face the interview. It is very important to recruit the right person.
• Lufthansa gives priority to develop their managers and junior management trainees. So they have cooperates with some renowned institutions like London business schools. These programmes set the highest standard to meet the expectations, and the management school got more than 200 awards from global companies. Lufthansa annual report says they have invested in senior and junior managers, which is useful to them, With the help of HRM and its recruitment policies they have succeeded to fill over 86% of all management post with staff in 2007 within the Lufthansa group.