Introduction of a HR System in a Family Business

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Human Resources Management > Best Practices > Introduction of a HR System in a Family Business

Introduction of a HR System in a Family Business
Nityananda Chatterjee
I have been directed to set up a HR system in my company. Recently the management of the company has been switched over to a foreign owner.
I am facing tremendous problems to change the existing work culture to give a proper shape to the organization.
I regret to say most of the staff members do not realize the importance of an HR Department. Therefore, it is difficult day after day to run the organization.
Actually most of the staff are nurtured in family businesses. They think that if their boss is pleased that is enough.
Under these circumstance I aks for a suitable advice to give a proper shape to the HR department.

Organization Design
Vivek Joshi
My experience is that in such cases a top-down as well as bottom-up approach is needed. For top-down, communication, setting of measurable objectives and an effective Performance Management System is needed. For bottom-up, external training, communication and reward system to be put in place.
Cultures change slowly, more so in social settings which are 'traditional", so you will need to give time to your people.

HR Involvement
Jack Van Den Heerik, Project Manager, Belgium, Member
I would like to suggest that there are two elements that could make your job and your life easier. The first is to ensure that you have a sponsor for your project who will support you in your undertaking of setting up an HR function. The second is that you must communicate to the organization the purpose and advantages of creating a HR organization and give your co-workers a reason to get involved.

Introduction of HR System
Schircks, Arnulf, Dr. , Business Consultant, Switzerland, Member
Two points are relevant using a professional project management approach:
1. Acceptance of a new system is rather more important than quality. Of course, you need a sponsor. And define ALL important stakeholders. Communicate with them (meetings, interviews), take their needs seriously and convince them for the system which satisfy all stakeholders.
2. For quality: use a professional Project Management approach e. e. PMI with 9 Knowledge Areas.

Introduction of HR Systems: Five Stages of Grief
Nokwazi Shongwe
It is quite challenging to move people from their comfort zones after a long time. However there are 2 models that I believe can solve such change resistance problems. The Five Stages of Grief by Elizabeth Kubler-Ross (1. Denial, 2. Anger, 3. Bargaining, 4. Depression, 5. Acceptance) and the Change Phases Model by Kotter.
Both these models need to be followed accurately through the steps in order to avoid and overcome resistance.
2 books by John Kotter that discusses change management are Force for Change, Our Iceberg is Melting: Changing and Succeeding Under Any Conditions.
A burning platform might be the last resolution however that can only be done after consulting all stakeholders involved to avoid mass strikes etc."

Introducing an HR System in a Family Business
Susan Germein
I agree with @Vivek Joshi to an extent. I recently worked with an outsourcing professional services team in Bangalore, trying to build a results focused & ownership culture where the traditional culture was high dependency and 'family' culture with no performance management / HR protocols in place.
I think it's important not to throw the baby out with the bathwater. What I mean is, there are many aspects of traditional Indian business culture which work really well and don't need to be fixed, yet you have a foreign owner who has a different mindset and different cultural expectations.
You need a HR department, but honouring the best of Indian culture.
This requires education of both the owner side and the employees, and as Vivek said, it needs time and patience.

HR Mission
Benjamine VO VINH - MARECHAL, Entrepreneur, France, Member
The key point about HR dpt mission is helping company to reach business effectiveness and growth. HR dpt must therefore be seen as a true business partner and you may have to explain your HR staff that this partnership role, their role, is very important for the company, so for the boss who will be "pleased" because of good results. So coming from their reality, you slowly introduce the fact that company success is the boss' success. Your staff could after be seen as first adopters of cultural changes.

Ensure Support of Owner
Md. Shahriar Hussain, Management Consultancy, Bangladesh, Member
I realize your problem. Such situations are seen in most of the private enterprises where a corporate culture is yet to develop. However, I think you should sit with the owner and try to explore his intention and whatever you want to do for establishing HR system, you need to have full support of the top person, otherwise you can't move.
If the rules of the game are not understandable by the employees then it's difficult to work and to achieve objective."

Introducing a HR System: Identify the Top Issues
Joseph Philip
The first step is to identify the top issues (the number depends on resources you have) where the staff needs the help of HR the most.
Then create solutions around them and try to implement them, and monitor them.
The best place to start is often recruitment and managerial skills coaching / employee counseling.
The next step is to involve executives in the projects where they have an interest.

Introduction of an HR System in Family Business
Rafael Acosta, Coach, United States, Member
Nityananda, as I read your request, I am not sure you if you are on board with what you have been "directed" to do. Your answers to the following questions should help you set right course.
1. Do you believe in the vision of the person who is directing you?
2. "Proper shape of the organization" or "foreign shape of organization" or "best long term business shape of the organization" which one do you know is best if its was your family business?
3. "Most of the staff members do not realize importance of HR dept". Nityananda you are the HR dept... You capture your co-workers attention when you convey confidence, intrigue, interest in others, enthusiasm, and respect. Once you have there attention they will begin to listen and hear what you have to offer. Good luck...

Introduction of an HR System in Family Business
Isabelle Virassamy, Mauritius, Member
I am of the view of @Rafael Acosta, you need to drive your people. You are the one who needs to capture their attention. You are the leader, am I right?
Whatever you will say and do, the first thing is to get their attention, motivate them through incentives or rewards... Inspire them.
One organisation problem is that there is no alignment between individuals' goals and that of the company: maybe you could try to solve this area.

Start with Discussing the Purpose of the HR System
Victor Aguilan, Professor, Philippines, Member
HR system is often viewed as a tool of management (owner). This view is common among union members. It's seen as a tool to control, monitor and discipline employees.
However if both management and employees begin to acknowledge that the HR system is a system for the good of the company - improving productivity, profit-sharing and better working conditions for all, then there will be less resistance and more cooperation from all stakeholders - employees, management, and stockholders.

HRM as a Strategic Partner and Catalyst of Positive Change
Kevin M. Adolfo, Management Consultant, Philippines, Member
Gone are the days when Human Resource Management was considered as a repository of employee files or information.
Human Resource Management Roles have metamorphosed into a strategic partner of the owners of capital in the achievement of the vision, mission, and goals. HRM activities, projects, and programs are indeed essential in realizing organizational strategic goals. Human resources are the most important resource of any organization.
Hence, it is but necessary to provide the HRM department opportunities to improve their craft. HRM also helps in improving organizational image and brand through the improve competencies of its' employees.
As a catalyst of positive change, HRM designs, and introduces new technologies, skills, culture, and the like. In the advent of stiff competition, the organization cannot be so lax or else it will lag behind its competitors. Ergo, HRM plays a crucial role in defining organizational competitive edge. HRM interventions must be aligned and integrated to the vision, mission, & goals of the organization.

Keep it Simple and Walk the Talk!
David Wilson, Manager, Canada, Premium Member
I agree with @Kevin Adolfo that the HR department must align its program with the vision, mission and goals of the organization.
The HR department must also have clearly defined roles and responsibilities, which must be communicated to people in the organization. It appears that you also need to manage the change from the old structure and culture to the new model.
This requires the use of a change management process, such as the one used by Kotter in his book Leading Change (1996).
I would also stick to the basics, such as the HR model defined by Pentti Sydanmaanlakka in his book An Intelligent Organization (2002, pp. 185-186). You also need the following: clarity of the model and strategy, engagement of employees, executive sponsorship, and straightforward tools and processes.
In addition, you need to answer the following questions: (a) why are we doing this? (b) are there willing partners? (c) are we communicating clearly?, and (d) are we listening? Remember, keep it simple and walk the talk!

Introduction of HR System
Parakrama Girihagama, Turnaround Manager, Sri Lanka, Member
In this process, my opinion that the process has 2 areas, a hard, technical area of the system which has to be attended to with competent organization members. And a soft area of winning the minds and hearts of the people, from the top to the bottom of your organization. In this area you might consider the change approach of unfreezing, moving and refreezing.

Shaping the HR.Department in a Family Business
K.Narayana Moorthy, HR Consultant, India, Member
@Nitynanda Chaterjee: if I were to be in your position, I would first translate and implement internal policies into a process that:
- Creates a culture which rewards individual and collective initiative;
- Creates economic, social, political climate encourages high rate of business growth & survival;
- Creates a quality in business;
- Creates a healthy competitive climate;
- That makes the individual & department as stakeholder (both internal & external) of environment.
I am aware that this is easier said than done...
But dogged pursuance of the above would result into softening the following HR issues: recruitment, training & development (up bringing the potential), appraisal system, termination, accountability & behavioural issues, competitive wage benefits, competition.

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