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Submitted By Omer Khalid Khan (10E0012) Submitted To PROF. F. A. FAREEDY

List of Problems
HR Department Structure/Design Owner mentality and vision because of planning, cost Planning team missing at the marketing research department High employee turnover rates Recruitment process Interview and Selection procedures Training of the employees Environmental conditions

Reasons for Core Issue:

HR Department Design HR department design was the biggest issue at the Gourmet. As there was too much product and

branch expansion of Gourmet, There was strong need to formalize the structure of HR department in its all aspects like functions of recruitment, selection, appraisals, benefits, hiring and firing etc. There were two HR managers, one HR general manager and one HR production unit manager. It wasnt a good idea as to have two different HR managers one for general purposes and one for HR related issues to production department as all the functions performed by them come under HR umbrella. All the HR functions were not being performed by the specialized persons as mediocre experience was given preference over qualification also it had become a culture that a little formal outlining the HR department function would do the job for them. There was no strict formal policy implemented at the production plant for the recruitment of employees. No definite policy of hiring and firing of the employees. Lower level staff both at the production plants and at the bakeries were not qualified and skilled. Employees motivation level was too low causing turnover to be high. Skilled employees for the production plant were not available easily so training was biggest aspect that needs to be catered but again no definite policy for the training of the employees. No proper training was given and sheduled for the staff of the bakeries about how to deal and attend the customer. Compensation and benefits department was not doing the job properly again because of lack of policy making and implementation. Pay for the lower staff was varying and depend upon the manager. No proper formal appraisal system was implemented. No formal policy about employee working hours and the amount of work load to be shared on peak occasions. Employees work for 72 Hrs. on festivals. Bonuses were distributed among them upon discretion of the supervisor and manager of the respective production plant.

Environmental and safety conditions were poor at the production plant. Injuries at the production plan to the employees were commonly. These injuries take weeks to heal and causes a lot of time off from the working schedule of the employee which adds insult to the injury during peak season or time.

Solution to the problem

HR Department Restructuring HR Department formalization and restructuring needs to be done on priority in the short run. There should be only one HR Head that would report to the CEO directly. All the policies related to the HR functions should be formalized under his supervision. Specialized HR persons should be hired to perform all the HR functions of recruitment, selection, appraisals, benefits, hiring and firing. This team would perform Job analysis for all the positions including lower staff and make a policy for minimum criteria for selection. Job analysis would help them to know more about the job entails at the production plan and the staff required at the outlets that would be communicating with the customers. This would help them in understanding what kind people they require and what minimum criteria to have for the selection of the employees. Policies would be developed in coordination with production plant management for the job rotation; it would help in increasing the motivation level of the employees causing decrease in employee turnover. Employees would no more feel limited by a specific set of responsibilities. Proper appraisal and benefit system to be regulated and implemented by having a defined policy which would be implemented at all the production plants. Owner vision/mentality
Chatha the owner of Gourmet bakers was used to father the company and seldom relied on any one for making key decisions in the organization. He had only one vision and that was to keep the costs of

production at a bare minimum that was the cause of developing a culture to always keep the cost low among managers with compromising on the quality of work whether it was at the production department or at any other department that was damaging the name of Gourmet. This was the lead cause of the rat invasion incident at one of the Gourmet bakeries at Lahore. Also he never uses any marketing research again to save the extra cost before introducing a product before in the market that was the reason that sales of Gourmet cola has suffered badly against its competitors. He always preferred experience over qualification of an employee was also damaging the quality of working being done at different departments. Overall his thinking

and his psychology to always save money was affecting the quality of the products and affecting the image in the longer run. Planning Team Planning team was missing at the marketing department. No formal marketing research procedure was adopted before having product expansion and diversification. If any product to be introduced it was always solely chathas decision that had to be implemented by the relevant department. Quality control department was missing from the scene to ensure the quality of the products. Redefine Owners Vision Owner needs to redefine his vision about the business. Quality can only be provided by having spending optimum cost to the customer. After the rat invasion incident at one of the Gourmet outlets, he hired sweepers to improve the cleanliness conditions at the bakery outlets. He needs to put money to restructure the departments of HR and Marketing. Marketing Department Restructuring Planning team should be developed at the marketing department. This team would conduct marketing research about any product before being launched in the market. Its role would also include test market the product before its launch decision to be taken. It would overall reduce the risk of product failure.

HR department design was the biggest issue at the Gourmet, as there was too much product and

branch expansion of Gourmet. There was strong need for the restructuring of HR department as all
the functions performed by HR were being performed in an ill-mannered way or were not being performed at all. Training & development, Compensation and benefits are all the functions of HR, so all these departments should be merged into HR and all reporting to the HR head.