MGMT7171 : Strategic Human Resource Management : New Zealand Rail Syst

Introduction: 

The main motive of this paper is to outline the significance and role of structure, culture, HR strategy that are being adopted by Kiwi Rail. Kiwi Rail is a rail operator who manages rail activities and operations successfully. The business activities, products and business strategies have been explained in the task briefly. Kiwi rail uses innovative HR strategy like talent management to attract and retain capable and potential applicants apart from this, the company maintains unique culture in the competitive market. The paper explains that how business strategy and HR strategy are interconnected with each other and how it helps in gaining competitive benefits.

Company’s History and Background

The New Zealand rail system started from the 1860s onwards. By 1953,the rail network reached its peak in terms of network reach approx 5689 kilometers. KiwiRail holding limited is a New Zealand state owned company liable for rail activities and functions in New Zealand. The company was incorporated in 2008 with it’s headquarter is situated in Wellington, New Zealand. It is one of the biggest rail transport operators in New Zealand (Kiwirail, 2018).

Product and services

The firm has business units of Kiwi Rail freight, interisland and the great journeys of New Zealand. Kiwi Rail manages and operates multi-million dollar projects that would improve and enhance services to the customer across the globe. The company further provides rail freight, urban passenger rail and long distance passenger services.

Operations 

It is stated that the company has employed approx 4,000 employees throughout the business units situated in New Zealand (Linkedin, 2018). The organization is committed to investing in network so that it is able to provide excellent services to the customers around the globe. In today’s era, the firm is operating and managing its business actions and operations in the international market.

Operational structure of Kiwi Rail 

The operational structure of the company is unique and strong that helps to improve and enhance the satisfaction level of the passengers. The operational structure of Kiwi Rail has been discussed below.

Evaluate the company’s current business and human resource strategies 

Analysis of current organizational objectives

Kiwi Rail objective is to develop and improve a high performance culture based on five key strategic themes:

• Hiring and retaining potential people by putting in place strong and innovative employer practices. This objective crucial to attain desired targets and goals with maintaining sustainability in the environment KiwiRail, 2015).
• Sustaining and developing a zero harm environment. It is one of the significant objectives and needed to maintain a healthy and favorable working environment. Zero harm a core priority and indicated its significance by selecting a dedicated and talented general manager to the executive leadership team. Zero harm at Kiwi Rail is about caring for and protecting each other, community, business and environment. Kiwi Rail is working to make a material improvement to safety productivity and performance through workforce engagement and active leadership KiwiRail, 2015).
• Rendering operational effectiveness and performance is one of the major objectives of Kiwi Rail. Delivering excellent outcomes and results as one firm still needs the business units to perform effectively and strongly. Freight plays an effective role in improving and enhancing the financial performance and efficiency KiwiRail, 2015).
• Empowering people and attaining financial targets and goals. The company is using cautious approach to forecast financial targets and revenue in near future. It is identifying and evaluating the growth opportunities for further enhancing and improving the revenue and value. It is evident that by empowering people and achieving financial performance lead various future benefits in the competitive market KiwiRail, 2015).
• Engaging stakeholders and customers. By engaging with customers and stakeholders, the firm is trying to improve relationship with them. In freight, strengthened partnerships with various customers like Fonterra and the key freight forwarders have resulted in maximized freight traffic. By attaining this objective, the organization could able to achieve customer satisfaction and improve customer experience. The firm has developed six core values such as care and protect, one wining team, excellent customer experience, strive for excellence, deliver results, and straight and true to achieve motivation and engagement (KiwiRail, 2015).

Evaluation of business strategy

It is investigated from the various studies that Kiwi Rail uses innovative and dynamic strategies to grow and uplift the profitability and outcomes internationally. Kiwi Rail uses Ansoff matrix to expand and flourish the business activities globally. The Ansoff matrix includes market penetration, diversification and market development strategy that are being used by Kiwi Rail while operating and functioning business at international level in today’s globalization world. 

Market penetration: It is one of the significant components of Ansoff’s matrix that used by the company to attract wide range of passengers globally. To penetrate the majority of customers, Kiwi Rail focuses on innovative services and products. According to McDonald, Payne & Frow (2011), Kiwi Rail is securing dominance of growth market by using this strategy.

Market development: It is examined that market development factor focuses on developing and improving new markets and services globally. By implementing this strategy, the company explores the business function in the foreign market (Shaw, 2012).  As per Shaw (2012), there are various ways of approaching this strategy include new product dimension, new distribution channels, and new geographical markets. Thus, Kiwi Rail uses all the ways to compete with rivals in the global market (McDonald, Payne & Frow, 2011). 

Diversification: It is a fundamental strategy that focuses on the development and improvement of new services related to transportation and freight to sell into the existing market (Freemanagementebooks, 2018). A literature given by McDonald, Payne & Frow (2011), diversification is an inherently risky strategy because the business activities are moving into the market in which it has little experience and knowledge. Hussain, Khattak, Rizwan & Latif (2013), argued that diversification strategy helps to launch innovative services and to predict assessments risks of the market. Kiwi Rail initiates this strategy to diversify the business and introduce new services in the global market. 

It is stated by Hussain, Khattak, Rizwan & Latif (2013), Ansoff matrix helps in creating a risk aware culture in the workplace. Along with this, long term mission and objectives are set with the help of this business strategy. By initiating the Ansoff matrix, Kiwi Rail takes ample of opportunities in the foreign market while implementing the business actions and operations in the global market. Moreover, the firm easily distinguishes its products and services from the rivals by implementing this strategy globally. It shall be noted by Freemanagementebooks (2018), this strategy helps in keeping an eye on the productivity and performance of the competitors globally.

Identification and discuss of the existing HR strategy

It is noted that talent management is ongoing strategy that helps in hiring and selecting right and potential candidate for performing tasks and duties in a hassle free manner. The aim of this strategy is to improve and enhance the value and to make it possible for firm to attain its long term goals and objectives (Armstrong & Taylor, 2014). It is innovative strategy that helps in managing and handling the ability, power, talent and competency of the workers within the organization. HRM at Kiwi Rail plays a advisory and support role in the organization (Scullion & Collings, 2011).

By implementing this strategy, the company is able to improve and boost the experience, knowledge and potential of the workers while functioning at international level. Employee engagement or commitment is one of the major benefits of talent management strategy that has been adopted by Kiwi Rail. An efficient and organized approx to on boarding is attainable with the help of talent management strategy. The company further creates worker profile which holds all of the data, facts and information during the hiring and recruitment process. Apart from this, morale, confidence and loyalty among the workers are enhanced and improved by implementing this strategy at the workplace (Scullion & Collings, 2011).

Along with this, the company uses balance scorecard framework to accomplish desired objectives and targets. The balance scorecard framework is a management tool or method designed to render a view of company from both external and internal perspective. The four perspective including financial perspective, growth perspective, customer perspective and internal business perspective are used in balance scorecard framework (Boselie, 2010). By initiating this strategy, Kiwi rail attains its financial and growth objectives with providing satisfaction to the customers. 

Compare the company’s HR strategy with the Business strategy

There is a strong and effective relationship between HR strategy and business strategy. It is noted that Ansoff matrix is used by the company to reduce and prevent the risks and challenges of the market whereas talent management strategy is initiated by Kiwi rail to improve and enhance the skills and talents of the workers (Heatley & Schwass, 2014). It is portrayed that Ansoff’s matrix focuses on the product and market development on the other hand, talent management strategy focuses on the skills, talents, experience and competence of the workers (NYLN, 2018). The talent management strategy helps Kiwi Rail company to conduct business operations successfully while Ansoff matrix strategy helps in making a dynamic and strong financial position in the global market. By implementing Ansoff matrix strategy, the company can overcome the competitors and it also helpful to analyze and determine the threats, challenges and risks of the market (Holden, 2010). On the other hand, talent management helps in providing training and development coaching to the workers at international level.

Talent management strategy is needed to reach at top level in the market whereas business strategy is used by the company to meet the long term needs and requirements of the business. By giving staff meaningful work and innovative opportunities through talent management, the company boosts and improves the morale, well being and loyalty of the employees where as Ansoff matrix strategy helps in attaining competitive edge internationally. If the company uses talent management strategy then Kiwi Rail can reduce staff turnover along with this, it will have to invest less money on recruitment. Therefore, the company saves time and resources while implementing the business internationally. On the other hand, Ansoff matrix is used by the company to penetrate the entire market globally. Rendering employee development opportunities, innovative work culture and clear purpose make the company a super and effective attractive and unique employer. In this context, Ansoff matrix strategy helps in identifying and analyzing the trends, choices, wants and requirements of the customers to improve and enhance the goodwill in the market (Bass, 2018).

Company’s experience (Achievement and failures)

Kiwi Rail works with various customers in the aftermath of the Kailoura earthquake thus, it won the excellence award at the Australian rail industry awards 2017. Apart from this, the company got ‘New Zealand workplace health and safety award’ in 2017. The company is well known and recognize for best initiatives to promote and encourage the workers at the workplace. The company has invested approx $1b in renewable and rail network. Simplification and standardization are main strategy of Kiwi Rail that helps to attain various benefits globally. The firm is providing world class tourism experience, knowledge and rendering sustainable transport alternative and minimizing the emissions to attract maximize customers (Kiwi Rail, 2017).

In 2008, an election year, that Helen Clark’s labor led government bought back the country’s rail assets under the Kiwi Rail banner that hampered the image of the firm. Finance minister Michael Cullen stated at that time that negotiations with the previous owner, Toll, it became clear that purchasing the rail operating business such as the inter-island ferries was the effective and excellent way to maximize and improve investment in the industry. Running a commercially feasible business will prove highly difficult without government assistance and support (Williams, 2018). Aside this, Kiwi Rail had seen an unexpected amount of failure in their fuelling mechanism that cost was approx a million dollars. Beside this, fuel leakage was further disrupted the image and growth of the company adversely. Beside this, there is one engine failure being examined as is the cause of the spike in injector failures (Stuff,  2018).

Describe organizational culture 

Culture plays a significant and major role in conducting business functions and operations successfully and effectively. All Kiwi Rail employees are liable for safety and security and they take this responsibility seriously. The company uses wide range of indices to measure workplace safety and culture globally. The culture of Kiwi Rail is unique and effective which helps in promoting and improving the health and safety of the workers. Zero harm has been initiated at every level of the company at the workplace from top management to executive team and is valued as a proxy for leadership in the company. Engagement with employees is an effective key to develop and improve the initiatives and processes that promote health and safety at the workplace. KiwiRail’s health and safety action teams (HSAT) promote and engage with frontline executives to facilitate a strong and favorable culture at the workplace and leaders or managers are promoted to place zero harm at the forefront of routine activities (Karlik-Neale, Browne & Anderson, 2010). There are various models being used by the company, two models for Kiwi Rail have been discussed below.

Globe’s 9 culture dimensions: Kiwi Rail uses this model to eliminate and prevent the cultural differences among the countries (Chhokar, Brodbeck & House, 2013). The 9 dimensions of this model include the following:

Future focus: Proper planning is being done by Kiwi Rail to attain success and growth in near future as it further helps in reducing challenges and risks.

Uncertainty circumvention: The degree of dependency on accepted rules, standards, socials, legislations and procedural navigations to reduce the future uncertainties. By implementing this dimension, Kiwi Rail is trying to reduce future barriers and shortcomings.

Power distance: It refers to the power of individuals that helps to perform tasks effectively.

Humane orientation: This dimension is used by the company to find out and analyze the way that helps the workers to keep motivated them towards the job.

Performance orientation: By implementing this dimension, Kiwi Rail identifies and analyzes the levels of how the collective promotes and rewards the individuals for excellent efficiency, productivity and performance (Chhokar, Brodbeck & House, 2013). 

Collectivism I: The performance and productivity are rewarded and recognized by the company effectively.

Collectivism I: The degree with which group members within a group take pride in their attainment and are loyal and confident to the company.

Assertiveness: It shows the amount of confrontations, assertiveness and effective relationship between the group and individuals.

Gender fairness: The degree of gender inequality in a group or team.

It has been portrayed that Kiwi rail focuses on this model to communicate and collaborate with individuals and customers effectively. Open communication is maintained by the company with the help of this model (Chhokar, Brodbeck & House, 2013). 

Hofstede’s national culture: The Company uses Hofstede’s national culture model to reduce and eliminate the differences related to cross culture. There are six dimensions of this model include individualism vs. collectivism, power distance, short term vs. long term orientation, uncertainty avoidance, and masculinity vs. femininity. Hofstede model helps in enhancing and boosting motivation and reducing conflicts among the workers. It is one of the significant models to improve organizational productivity and performance (Schein, 2010). This models further helps to describe and outline the effects of Kiwi Rail culture on values of its members and how these values and competences related to actions and behavior using a structure derived from component analysis. Power distance shows the degree to which the less powerful employees or members of a community accept power and they expect that power and authority is distributed unequally. Individualism vs. collectivism shows choices, preferences and needs of the society and members. Masculinity versus femininity indicates preferences in the community for attainment, assertiveness and rewards for success and growth. Masculinity versus femininity related to “tough versus tender”. Apart from this, uncertainty avoidance shows the degree to which the members of the company and society feel uncomfortable with ambiguity and uncertainty. The fifth dimension is long term orientation versus short term orientation, this dimension helps in maintaining some links with its own past while handling with risks and challenges of the future and present. Lastly, indulgence versus restraint stand for a community that permits free gratification of basic and human factors related to having fun and enjoying life (Schein, 2010). 

Link between organizational culture, the HR strategy and structure 

It is stated that Kiwi Rail uses innovative strategies, structure and culture to promote the freight and passenger services in the global market. There is a close relationship in structure, HR strategy and organizational culture (Marshall & Shaver, 2010). The main goal of the company is to ensure that workers and supervisors get home safety and security. Strong corporate structure and governance lead favorable culture in the workplace. It is noted that strong culture can be maintained with the help of HR strategy. HRM plays a vital role in promoting dynamic and attractive culture at the workplace. Without HR strategy, Kiwi Rail cannot struggle with competitors globally as it also hampers the culture and values of the firm internationally (Macno, 2012).

Implications of HR managers and recommendations 

It is implemented that HR managers should work towards the improvement of leadership and culture to earn more profitability and attract candidates globally. The company should maintain a diverse workplace to fulfill the needs and requirements of the customers globally. High performance high engagement program shall be implemented to empower the frontline executives and provide effective solutions for problems.

It is recommended that Kiwi rail must conduct survey to measure and identify the employee engagement and level of satisfaction of the customers. Strong and open communication shall be maintained to improve efficiency and effectiveness. The company should invest huge amount on leadership training and development coaching to improve the capabilities of the workers.

Conclusion: 

It is concluded that Kiwi Rail is a freight and transport company that provides transport services to the customers across the globe. It is showcased from the above study that Kiwi Rail maintains strong culture as it also uses innovative HRM strategy such as talent management, and recruitment and selection strategy. The innovative and open culture at Kiwi Rail helps in attracting workers who posses potential, skilled and experience.  Apart from this, the organization maintains strong corporate culture and structure to stay in the international market.

References: 

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