Human resources are one of an organization's most valuable assets, frequently serving as a foundation for the company's future. According to Lahoti (2011)'s research, the productivity of every organization is directly tied to the quality of its people resources. As a result, it is critical that these resources be correctly developed in order to attain the required degree of performance (Akinbowale, 2014). Realizing the value of these resources, most businesses have turned to human resource development as a fundamental method for achieving long-term organizational objectives. Human resource development (HRD) is a management framework that is used to assist employees in developing their personal as well as organizational skills, knowledge, and experience. According to Esha & Kumar (2016), HRD professionals are tasked with the responsibility of developing an organization’s strategic direction and values and enforcing the understanding of these values in employees. As highlighted by Nankervis & Stanton 2010), most multinational companies, including Coca Cola, have successfully utilized HRD programs to create a pool of talented, experienced and self driven employees often seeking to attain set organizational goals (Abdullah 2016). Through efficient human resource management, the company has experienced tremendous growth over the years. Although the company has managed to effectively manage its resources, its status as a multinational retail company exposes it to several unique HRD challenges (Coca cola 2017). Being a global firm, it is essential that the company takes into consideration the cultural, social and political differences between employees while developing human resource policies and procedures. This paper discusses the unique challenges faced by Coca cola in implementing HRD programs and recommends appropriate solutions to the identified challenges.
Human Resource Development at Coca Cola
Human Resource Development (HRD) is an essential component of every organization. Coca Cola Company is the best beverage manufacturer, retailer, and marketer of non-alcoholic beverages. The company’s headquarter is based in Atlanta, with various operations distributed in more than 200 countries worldwide (Coca cola 2017). Although it was first invented in the United States, the company quickly grew into different places, creating a culture of drinking its beverages through the various brands it designs. The company operates on a franchised system, and produces only syrup concentrates sold to various bottlers. With a vision of being “outstanding beverage company leading the market, inspiring people, and adding value through excellence,” Coca Cola has managed to create a significant reputation through its provision of quality drinks and services (Coca cola 2017). Coca Cola Company deals with different products including soft drinks, tea, bottled water, and sport juice that are produced and distributed by human resources from different regions. Despite having extensive operations base, the company boasts of a talented group of employees globally (Chuang, 2013). This advantage can be attributed to the efficiency of the company’s human resource department. Human resource policies put in place focus on improving human capital through effective recruitment; training, performance appraisal among others. While the company boasts of having productive employees, its human resource development officers face constant challenges in their pursuit of efficiency (Toracco, 2004). The common challenges affecting the efficiency of HRD programs can be divided into five major categories namely:
Employee needs assessment, identification and training challenges
Technological challenges in developing and implementing training programs
Difficulty in aligning HRD to organization’s HR strategies
Changes in workforce demographics
Labor mobility
Employee needs assessment, identification and training challenges
According to Abdullah (2016), major issues affecting employee productivity stem from their levels of education and technical trainings. Most organizations are faced with the constant challenge of identifying top talents with desirable level of education and experience from the wide pool of applicants in the job market to fill various positions (Singh, 2007). Once applicants have been shortlisted and selection of the most qualified candidates undertaken, the company must provide appropriate training to fine tune employees to strategically fit into the organizational culture. Stone and Deadrick (2015) regard employee training as a development strategy that begins with identification of training needs. Human resource development professionals perform an analysis of different positions to determine the training requirements of each position. Coca cola prioritizes and treats its employees respectfully by helping them to attain personal as well as organizational development goals (Coca cola 2017). It aims at creating an environment that encourages employee excellence through skills improvement and goal achievement. The company provides a number of training and development programs through coaching and on the job training. Coca cola exercises a top –down training program that focuses on ensuring all its employees learn about the tools of continuous quality improvement (Lahoti, 2011). The training program covers operational techniques such as problem solving, statistical process control and process management. Evidently, more time is spent training tactical and strategic level managers while the operational level employees are ignored (Mandhanya, 2015). Although tactical and strategic level managers are key to the achievement of long term organizational goals, operational level employees act as company’s key contact with the market and should as a result receive proper training. The company’s human resource department faces immense challenges identifying employee training needs and designing appropriate training programs (Hr Council, 2017). The business environment continues to evolve thereby exposing the company to new sets of challenges.
Technological challenges in developing and implementing training programs
Besides needs identification challenges, Coca Cola human resource development professionals also face additional employee training challenges stirred by the high rate of technological obsolescence. Technology as highlighted by Mandhanya (2015) plays a key role in enhancing implementation of employee development programs. While it provides a great platform upon which the company can gain competitive advantage, it could also pose greater challenges for HRD professionals. This is because functions undertaken by most employees in the company are manual and their services could become obsolete thereby warranting immediate HR attention (Wong and Zolkifi, 2017). On a positive side, technology has not only enhanced the company’s ability to design and develop market friendly products but also increased the company’s ability to access markets through social networking and online advertising (Toracco, 2004). The emergence and adoption of green technology production techniques, for instance, prompted Coca cola to shift to the greener bottles concept (Lahoti, 2011). In the view of Goel & Gautam (2006), the adoption and success of this technological concept would require the company to have innovative and creative employees with outstanding abilities. HRD professionals are unable to develop and use standard training programs. HRD professionals have as a result focused on ensuring that employees acquire the right set of skills and knowledge to implement these new technologies (Singh, 2007). To date, technology still remains one of the major challenges impacting the efficiency of human resource development programs at the company.
Challenges arising from poor alignment of the company’s HR strategies
According to Mankin (2010), the success and effectiveness of any HRD program depends on the organizations culture on human resource strategies. Strategic HRD structure consists of the ability of these professionals to formulate plans and policies that are aligned with plans and policies of the Human resource department. Hayward (2017) suggests that the said plans and policies must also incorporate the company’s business plan. Often times, plans and policies from all the three perspectives are imperceptible; especially because most HRD strategies are short term plans that are only unique to the organization. Coca cola’s HR strategies focus on improving employee value through performance appraisal, compensation and rewards, training and development among others (Mandhanya, 2015). The functions of human resource extend to screening and selection of applicants during recruitment. For the company’s HRD department, employees with expertise are highly valued in the organization and are often more sought after. Identification of these special skills is however a daunting task for most companies. In line with this fact, Akinbowale 2014 insists that HR officers at the company should be tasked with the responsibility of ensuring Coca cola develops and provides for the high caliber employees by focusing on efficient recruitment, selection, training and development strategies (Wong and Zolki 2017). Like in most large scale retail organizations, HRD professionals are likely to experience a lack of support, commitment and cooperation from other departments thereby affecting the efficiency of implemented strategies. This could in turn affect the effectiveness of employee learning and motivational programs.
After selection and training, employees are appraised to determine the level of success in performing assigned tasks. Performance appraisal is a human resource development function that focuses on obtaining, analyzing and recording information about the worth of an employee (Akinbowale, 2014). The major objective of performance appraisal is to recognize employee strengths and identify weaknesses that need to be worked upon to increase employees’ relative worth. Coca-Cola human resource department undertakes annual appraisal of its employees. The process is designed to enable the company to know the true position of its employees’ work capacities and the problems that they face. Currently, Coca Cola Company has approximately 700,000 associates and operates in over 200 countries worldwide (Chuang, 2013). The company faces a unique challenge owing to its wide network of employees. According to Abdullah (2016), diversity in culture and values is the root of most challenges facing multinational companies. While some cultures value collaboration performance, others value individual performance. Where collaboration performance is encouraged, individual employee performance would be hard to ascertain (Akinbowale, 2014). Further, employees in these cultures are accustomed to group performances and could as a result not value individual performance appraisal. Some cultures encourage employee innovation while others prefer adherence to the status quo. According to Swanson & Holton (2009), these differences could lead to inconsistencies in the development of performance appraisal programs. Owing to the fact that the company’s annual appraisal programs centre on American business values, it fails to capture the essentials portrayed by other cultures across the world.
Changes in workforce demographics
Besides filling in entry level vacant positions, HRD officers are also faced with the imminent challenge of identifying and filling in top management position with the appropriate personnel. This challenge is further magnified by the diversity in the company’s workforce dynamics. According to Abdullah (2016), deficiency related to human resource capital is related to the increased rates of the ageing workforce. Baby boomers represent a group of experienced employees who have through efficiency attained promotions to the level of top managers. Finding suitable replacement for the exiting baby boomers is a challenge that continues to affect the efficiency of human resource developers globally. Workforce dynamics affects companies in developing as well as developed economies. United States for instance continue to face problems relating to very high rate of baby boomers entering the workforce. As a multinational company, coca cola is affected by these dynamics to a great extent (Akinbowale, 2014). Research into the company employee demographics indicate that most top management employees are baby boomers who could be leaving the company within the next five years. Baby boomers are a special class of employees who are preferred for top management owing to the level of emotional intelligence. As the executive observes, persons that have been in employment for longer periods are not only emotionally intelligent but they also possess great communication skills than their counterparts. These skills are however not easy to identify in the younger generation thereby posing great hindrance towards effective hiring and placement. A statement issued by the company’s Chief Executive Officer, Muhtar Kent, affirms that the company’s dynamics have changed greatly over the years (Chuang, 2013). The Chief further reveals that replacements for top positions in the company are done using internal recruitment of generation X and Generation Y employees. However, rigorous training is required of these employees is necessary to help them fit into their new roles. HRD officers at the company have attempted to find new ways to ensure the company’s continuity even with the forecasted exit of the baby boomers.
Effects of labor mobility
One of the general characteristics of labor capital is mobility. Mobility has been aggravated by globalization and advancement in technology. Technology has increased the ability of employees to work for firms from any location (American Productivity & Quality center, 2004). Labor mobility is equally dependent on employee generation. According to the company’s website, ‘millenials’ are deemed as the most mobile employees. They are often in the move, hoping from one job to another in search of greener pastures and greater challenges (Swanson & Holton, 2009). Baby boomers on the other hand, are seen to be more stable emotionally and are therefore less likely to shift from their current employers. This trend can be likened to the fact that millenials are just beginning their careers and are on a journey of self discovery. This generation of employees is often positively inclined towards attaining certain personal development goals before specific time periods (Toracco, 2004). When these goals are not met within the specified time frame, they formulate an exit strategy in search of better opportunities. Owing to this characteristic, they are the least preferred for managerial positions. An employee’s decision to move to a different company is also dependent on the level of expertise. Abdullah (2016) notes that “elite expertise workers, who are viewed as technically expert, skilled and competent,” are more mobile than those lacking these skills. This trend can be likened to the fact that elite expertise workers have a higher bargaining power for better terms of employment. They can as a result take control of their own career development and advancement. The increased mobility of employees is a great disincentive to employee training and development (Strohmeier, 2013). There are a number of competitors who strategize to poach talented employees from other institutions. These firms are reluctant to budget for employee development and therefore seek to obtain already trained employees from other organizations. For these reasons, most HRD professionals tend to focus their training and development programs on other generations of employees whom they think would serve the company longer using the acquired skills.
Recommendations
Human resource development is an essential part of Coca Cola’s human resource management. While the profession has enabled the company to attain its millennium goals, it faces immense challenges that could impact negatively on the company’s long term goals if not addressed on a timely basis (Strohmeier, 2013). The literature identifies training issues as a major variable that continue to affect the efficiency and effectiveness of HR programs. It is essential that individual employee training needs are assessed prior to adopting any specific training program. According to Firdousi (2016), training needs assessment is the first step to developing an effective training program. While coca cola conducts frequent trainings for its employees, it does not take into consideration the needs of operational and entry level employees. The management highlights labor mobility as the major factor influencing their decision. Firdousi (2016) suggests that training needs assessment should be conducted for all employees so as to create a superior workforce. Coca cola should also focus on training generation X employees in preparation for the exit of the baby boomers generation. This is a long term vision that is only implemented gradually once appropriate generation X candidates have been identified(American Productivity & Quality center, 2004). Where the company finds no suitable candidate for the top level positions, it should survey the industry in search of competent managers from other multinational corporations who could readily accept its offer. The company’s HRD professionals should focus on incorporating technological advancements into training programs.
The company’s problem with labor mobile employees could be solved through an upgrade of the human resource policies and procedures. For instance, it could modify its clause to restrict employee movement out of the company for a specific period of time in the event that company resources are used to train them. Further, employee motivation programs could be upgraded to help retain these employees (American Productivity & Quality center, 2004). Coca cola’s HR team should undertake a survey of the company’s top competitors to determine the compensation packages that are used to poach their employees. This data is used to help the company design a comparatively better compensation packages that if implemented would help increase employee retention rates (Strohmeier, 2013). Owing to the diverse nature of the company’s employee base, effective appraisals can only be undertaken when host country culture is taken into account. Employees based in countries that value innovation should undergo appraisal process that is geared towards gauging their level of innovation. On the other hand, employees based in countries that value collaboration and teamwork should equally be appraised using this metric.
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