Read the case study below and imagine that you are the Business Adviser for the company. Write a 2,000-word report outlining your advice to the Divisional Director of PineApps Ltd on the following issues:
Based on the academic literature, discuss and evaluate the advantages for Pine-Apps Ltd in developing their own HR function.
Evaluate the role of a performance management system.
Explain how a performance management system can be implemented with other HR processes to improve organizational performance at Pine-Apps Ltd.
1 The grade is provisional until confirmed by the relevant assessment board(s). Your work will be marked in grades rather than percentages. This is considered to deliver the most accurate and fair outcomes for students. Each assessment that you undertake will be assessed using the common grading system. Information about the grading system can be found in your Student Handbook, Section 13.
The Grade Criteria can be found in Appendix C of your Student Handbook.
Assessment Brief: LSBM205 – 2020-21 Page 2
Explain how a performance management system can be used to improve employee commitment and engagement at Pine-Apps Ltd,
Please identify the challenges they may face using this system and propose how these can be overcome or managed.
You should present your work in a report format using headings and sub-headings
Follow the structure of the assigned tasks in your report.
Graphs and tables are accepted.
Please place any documents, policies, or similar in the appendix.
Please submit the assignment in MS Word format.
Please ensure that you refer to the academic literature and the case study to
illustrate your answers for each task.
Please ensure all sources are cited throughout your report. Use the Harvard Referencing system
Further details including suggested websites and resources will be on Canvas ‘Module Materials AB1 Case Study’
The weighting of the tasks
Response to Task 1 is worth 30% of the overall grade for AS1.
Response to Task 2 is worth 30% of the overall grade for AS1.
Response to Task 3 is worth 30 % of the overall grade for AS1.
Academic Conventions (i.e. structure, layout, clarity of the response) are worth 10% of the overall grade.
Assessment Brief: LSBM205 – 2020-21 Page 3
Case study: Performance Management at Pine-Apps Ltd
Pine-Apps Ltd is a technology start-up company that has been operating for just over two years. The company was established in 2018 by Georgina Whitecross and Tim Garrix, software developers who developed an app that revolutionized financial services in 2018. In less than two years, the business has developed over 50 very successful apps with many more in development. Revenue has increased by 200% from just over £50,000 in 2018 to £10 million in 2019. Pine- Apps is fast becoming the leading global app developer. Current clients include most of the FTSE’s top 100 companies.
Pine-Apps Ltd has enjoyed incredible early success. However, more recently it has started to experience several significant internal problems due to the company’s fast growth. These problems have included poor communication, high levels of labor turnover, and slow product development. To cope with the growth, six months ago the CEO and founder Georgina Whitecross developed a new organizational structure with two departments: Research and Development with 50 employees and Marketing and Sales with 10, supported by a small administrative team of 5 employees. Her partner and co-founder, Tim Garrix, has been appointed as Head of Research and Development. They have recently hired a new Head of Marketing and Sales. In a bid to manage the increasing workload, they have decided to focus on their core competencies and outsource the HR and accounting functions.
In a very short period, the company has undergone significant change, growing from a small team of three to employing 65 highly skilled employees two years later. Currently, over 50% of the Research and Development employees are recent IT graduates with less than 6 months of service. The skills required for these roles are fast-changing thus making graduates the best source of available labor. Pine-App’s industry reputation and generous employment benefits (including above-average industry wages and conditions which include pensions and leave, and opportunities for growth and promotion) ensure it attracts the best graduates. However, labor turnover amongst the recent graduate recruits has been very high at 55%, with average tenure being six months. While these graduates are highly ambitious and initially appear to be very keen, the company has found that they lack commitment and loyalty. As one former employer stated, ‘I came to Pine-Apps, to gain experience from the best in the industry so I can develop my own apps and create my own business.’
Senior experienced Research and Development employees have also been expressing their dissatisfaction with the company. At Pine-Apps, training and mentoring are the responsibility of senior members of staff. The company believes that due to the fast-paced nature of the industry and technology, it is essential that senior members train and mentor the graduates. However, due to the high turnover of graduates, this has placed an additional workload on the experienced members of staff. One senior developer claimed, ‘it’s like we have a revolving door, every time we employ a new group of graduates they are all keen and excited but as soon as we get them up to speed, they then turn around and leave and we are left to clean up the mess.’
Graduates have also expressed dissatisfaction with the mentoring system and lack of formal training opportunities. They have claimed that they are working in small teams and receive very little formal guidance and no formal training from the senior members. Instead, they claim that they are expected to do what they believe is the ‘boring repetitive work’. They argue that the lack of formal training and very limited opportunity to work on exciting projects is negatively impacting their skill development and employability. They also believe that they are given little opportunity or time to develop and work on their own new ideas and projects.
Product development relies on high levels of communication and team working. However, the lack of social cohesion, especially between the senior and junior employees, has also been identified as a growing concern hindering this process. The resentment between the more senior and junior members has stifled communication and team working. Regularly, senior members organize meetings to discuss new and current projects but more recently they have stopped inviting the graduates. Due to the high turnover of graduates, senior employees believe it would be a waste of time for them to attend the meetings, plus they are also concerned over issues of confidentiality and intellectual property. This problem has been further heightened by the recent Covid-19 crisis which has led to remote working. There have been few initiatives by the company to engage the employees during this time and many of the graduate employees have felt isolated and disengaged.
The CEO is very concerned about the rising costs associated with the outsourced HR function. She believes that costs have risen dramatically in relation to recruitment and selection. Despite the
Assessment Brief: LSBM205 – 2020-21 Page 4
considerable investment in this process, she feels that they are being sent candidates that are not suitable for the needs of the business. She is also concerned by the growing divide amongst the Research and Development department employees. She believes for Pine-Apps to continue to grow and survive they must address the issues of poor communication and employee engagement and commitment.
Author Dr. Melissa Kerr Fictional Case Study. For more information on Human, Resource Function check on this: https://en.wikipedia.org/w/index.php?search=Human+resource+function
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