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CHANGING THE HR FUNCTION AT BELLAS: A CASE STUDY

Bobby Medlin, USC Upstate CASE DESCRIPTION The primary subject matter of this case concerns analyzing and evaluating a decision a small business must make concerning the management/administration of its human resource function. The case depicts a general managers concern that individual performance as well as organizational performance/effectiveness of a small business is beginning to suffer due to the human resource management demands that have become part of her positions role in the firm. This case has a difficulty level of four. It is designed to be taught in one class hour and is expected to take approximately three hours of student preparation time. CASE SYNOPSIS Students are provided with a management scenario describing a general managers request to the owner of a small business to change the HR management function within the firm. This change would involve either A. hiring a full time HR professional who would become part of the management team, B. outsourcing the entire HR function to another organization, or C. outsourcing selected portions of the HR function while keeping select areas inside the organization. Students are asked to review the scenario, evaluate each alternative, and make a recommendation to the owner of the firm. Within the evaluation of alternatives, students are also instructed to develop a job description and a job specification to support the recruiting/selection process that will occur if option A. is chosen; to offer a step by step process that should be followed if option B. is chosen; to identify and support areas that should/shouldnt be outsourced if option C. is chosen. In addition, students are asked to evaluate any additional alternatives that would address the issue. Finally, students must make and support recommendations to the management of this organization. HR outsourcing statistics to supplement the class discussion is provided as an Appendix. INSTRUCTORS NOTES Recommendation for a General Teaching Approach This case was specifically designed and has been successfully used to reinforce the idea that small businesses often grow to the point in which professional HR management is necessary for Journal of the International Academy for Case Studies, Volume 15, Number 6, 2009

100 organizational effectiveness. The case requires students to explore and evaluate a number of alternatives available to a small business to enable this to occur. A general instruction approach includes a discussion of change associated with growth, the potential impact of the decision on HR outcomes, the need for updated job descriptions and job specifications, the advantages and disadvantages of outsourcing, and a thorough analysis of a number of provided alternatives. A brief general description of outsourcing to supplement the class discussion is provided as an Appendix. Discussion and review should take approximately two in-class hours. The case instructs students to thoroughly analyze and evaluate three specific alternatives that are provided in the case. It also asks students to consider other potential alternatives beyond the ones listed. Individual instructors may require each student to submit a written report or he/she may prefer to require teams of students to make informal presentations of their analysis. Reports should be graded primarily for content with specific attention being paid to students ability to thoroughly examine alternatives to solve the problems/issues as presented in the case. If instructors decide to make the case a team presentation assignment, grading could also include an oral communication skills and/or a teamwork component. A general in-class discussion of the case is recommended after assignments are submitted or presented. The instructor may choose to highlight specific items from the case that offer significant concerns or challenges and ask students to identify the actions to address these items. INSTRUCTIONS TO STUDENTS Address each of the following: 1. Thoroughly evaluate each alternative provided. Develop a job description/job specification for the new position as part of the evaluation of option A. For option B., include a discussion of how generally accepted advantages and disadvantages of outsourcing might apply to this firm. For option C., be certain to identify areas of HR that you feel should/should not be outsourced. Also, for each alternative, address any implementation concerns as well as specifics regarding how each might impact the performance outcomes that Lynne feels are declining. Option A., hiring an HR professional: Students should address the costs/benefits\\advantages/disadvantages of hiring a full time HR professional. Anticipated performance improvements should also be explored. Implementation issues will probably be primarily related to the recruitment and selection of the new HR professional.

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101 Job descriptions/job specifications will vary among students; however, it is important to recognize that duties, responsibilities, and essential job functions are aligned with the needs of the organization. The job description provided below should be comparable to what students develop: JOB DESCRIPTION POSITION TITLE: Human Resources Manager POSITION SUMMARY: Performs Human Resources-related duties at the professional level; may carry out responsibilities in some or all of the following areas: recruitment and selection, employee relations, training, orientation, employment, compensation, performance management, and equal employment and equity programs. DUTIES AND RESPONSIBILITIES/ ESSENTIAL FUNCTIONS: 1. Administers various human resources plans and procedures for all company personnel; assists in development and implementation of personnel policies and procedures; prepares and maintains employee handbook and policies and procedures manual. 2. Participates in developing department goals, objectives, and systems. 3. Administers compensation program; monitors performance evaluation program and revises as necessary. 4. Performs benefits administration to include claims resolution, change reporting, approving invoices for payment, and communicating benefit information to employees. 5. Develops and maintains affirmative action program; files EEO-1 report annually; maintains other records, reports, and logs to conform to EEO regulations. 6. Conducts recruitment and selection effort (including screening and interviewing) for all exempt and nonexempt personnel and temporary employees; conducts new-employee orientations; writes and places advertisements. 7. Handles employee relations counseling, outplacement counseling, and exit interviewing.

Journal of the International Academy for Case Studies, Volume 15, Number 6, 2009

102 Participates in administrative staff meetings and attends other meetings and seminars. Maintains company organization charts and employee directory. 9. Assists in evaluation of reports, decisions, and results of department in relation to established goals. Recommends new approaches, policies, and procedures to effect continual improvements in efficiency of department and services performed. 10. Maintains compliance with federal and state regulations concerning employment. 11. Performs other related duties as required and assigned. KNOWLEDGE AND SKILLS: 1. Considerable knowledge of principles and practices of human resource administration, effective oral and written communication skills, excellent interpersonal skills. 2. Must have the ability to make recommendation to effective resolve problems or issues, by using judgment that is in consistent with standards, practices, policies, procedures, regulation or government law. 3. Ability to organize and prioritize work. EDUCATION AND WORK EXPERIENCE: 1. A bachelor's degree and one (1) to two (2) years of Human Resources experience 2. Professional in Human Resources (PHR) certification preferred. 8.

Option B., outsourcing the entire HR function: Students should evaluation the cost/benefits\\advantages/disadvantages of outsourcing. Cost savings, access to expertise, and employee morale will be three areas mentioned by students as advantages. Loss of management control will be prevalent among the disadvantages. The evaluations should identify specifically which ones would be most applicable to Bellas. Also, the analyses need to address how outsourcing will impact the outcome issues identified by Lynne Gibson. Students should identify steps that must be taken once the decision to outsource has been made. Though specific processes will vary, they should include the following areas:

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Identifying and selecting vendors Negotiating contracts Planning and managing transition Managing and evaluating the contract Managing the renegotiation and the end of the contract

The instructor should orchestrate a discussion of the potential dangers within each of these areas. Option C., outsourcing selected areas of the HR function: Students should identify which areas of the HR function would lend themselves to outsourcing opportunities for Bellas and why. Factors to consider would include expertise inside the organization, confidentiality concerns, acceptance issues among employees, financial cost/benefits, etc. Payroll and benefits are two areas that will be mentioned often as outsourcing possibilities. 2. Are there additional options that Lynne and Illa should consider? Are they more attractive than the ones under consideration? Responses to this question will vary significantly among students. Decentralizing the operation to give greater HR decision-making authority/responsibility to store managers will probably be mentioned by many. Restructuring the company will also be suggested by students as well. All options should be thoroughly evaluated by students. 3. What would be your recommendation(s) to Lynne and Illa? Students should choose among A., B., and C. alternatives; support should be provided for each recommendation.

Journal of the International Academy for Case Studies, Volume 15, Number 6, 2009

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