Strategic Human Resource Management practices in the public or private sector organizations in Bangladesh. A case study on “British American Tobacco Bangladesh”
1.1 History of BATB
British American Tobacco is the world’s most international tobacco group. Based in London, U.K. it is a market leader in more than 50 countries with the strength of 90,000 employees selling more than 320 brands in more than 180 markets worldwide.
British American Tobacco Bangladesh Company Limited is a subsidiary of British American Tobacco and is one of the 68 countries in which BAT has manufacturing plants. It is one of the oldest and largest multinational companies operating in Bangladesh. Based in Dhaka it has one cigarette factory in Dhaka and one leaf-processing factory in Kushtia. The company currently employs around 200 managers and 1000 employees.
Listed both on the Dhaka and Chittagong stock exchanges, BATB is the leading company in terms of capitalization at 7.93% of total market capitalization.
BATB started its journey as Imperial Tobacco Company limited in the then undivided India in 1910. After the partition of India, PTC (Pakistan Tobacco Company limited) was established in 1949 to meet the demand for cigarettes of whole of Pakistan.
After independence in 1971 Bangladesh Tobacco Company Limited (BTC) was incorporated on 2.2.1972 as a private limited company with only three shareholders of Tk.1000 each-2 from BAT and 1 from the government.
BTC has always been a part of BAT and in line with the global identity change, BTC was later named as British American Tobacco Bangladesh Company Limited (BATB) in 1998.
British American Tobacco Bangladesh is involved in various community development programs in the country. The company is also one of the highest taxpayers in the country.
- The company contributes more than Tk 12000 million to government annually (largest private sector taxpayer)
- Since the inception of its afforestation program in 1980 the company till date has planted and distributed 38 million trees across the country with a sapling survival rate exceeding 91%.
- Supports Shandhani (posthumous eye donation) and the Centre for the Rehabilitation of the Paralysed as well as other charitable development organisations.
- Is involved in vegetable seed multiplication program .
- In national disasters the company has been prompt in lending timely support to people of the affected regions.
- Is committed to develop backward linkage industries for the cigarette industry, leading to significant improvements in the packaging industry.
- Committed to rural wealth and hygiene improvements through concerted activities in rural areas.
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British American Tobacco Bangladesh has won many awards during the last 30 years. Among the awards won are the 1st Prize of Prime Minister’s National Award on Tree Plantation 99, Prime Minister Afforestation Award in 1993, Presidents Award in Agriculture in 1975, FAO Award in 1999 and the National Export Trophy award in 2000.
1.2 Objective of BATB
The ultimate objective of BATB is to gain leadership in the global tobacco market. In order to attain this objective BATB is following some policies and regulations. They have been trying to diversify their product box. Already they have introduced different types products in the market and get success.
1.3 Functions of BATB
British American Tobacco Bangladesh has comprehensive operations in Bangladesh. They often term this as ‘seed to smoke’ which means we have operations that starts from growing tobacco to distribution of cigarettes. Their different functions work in an integrated approach with shared goal of achieving the company’s vision and objectives.
Corporate & Regulatory Affairs
British American Tobacco Bangladesh is a responsible company operating within a controversial industry. At British American Tobacco, Corporate & Regulatory Affairs (CORA) works to assure stakeholders, who directly or indirectly influence the business.
CORA functions with three main wings:
- Managing Regulations.
- Promoting Corporate Social Responsibility.
- Driving Corporate Communications.
Human Resources
The Human Resources department bears primary responsibility for creating and sustaining a winning workforce for BAT Bangladesh. What this means is providing opportunities for talented employees to feel the satisfaction and fulfillment gained through being members of a responsible, winning organisation; where they are respected, rewarded and recognised; where their efforts are encouraged; where their careers are developed; where they understand the vision and strategy of the company; and they know where they fit into the bigger picture.
The Human Resources department bears primary responsibility for creating and sustaining a winning workforce for BAT Bangladesh. What this means is providing opportunities for talented employees to feel the satisfaction and fulfillment gained through being members of a responsible, winning organisation; where they are respected, rewarded and recognized; where their efforts are encouraged; where their careers are developed; where they understand the vision and strategy of the company; and they know where they fit into the bigger picture.
The HR function within BAT Bangladesh takes care of three broad areas:
Þ Organizational development
Þ Reward
Þ Talent sourcing
Þ Employee relations
Marketing
At British American Tobacco Bangladesh, informed adult consumers are at the centre of our interest. Marketing in the tobacco industry requires more focus, more acumen and most importantly a clearer sense of responsibility than in any other industry. We expect our marketing team to have the ability to differentiate our marketing initiatives, to manage productive and profitable relationships with our key accounts, to integrate strategies above and below-the-line and to be innovative – while always behaving responsibly, which is a fundamental philosophy in our marketing challenge.
Marketing operations at British American Tobacco Bangladesh include a range of activities like Brand management, Trade marketing and distribution etc.
Finance
In a competitive business environment, a commercially astute finance function is critical for making good business decisions – for example – about which brands or countries to invest in, in evaluating and improving returns.
Finance managers within BATB are part of the decision-making team, a business partner who is consulted and involved day to day, not merely reporting results and setting budgets.
Finance department’s activities of BATB include:
Þ Setting and delivering against financial objectives.
Þ Planning and budgeting for optimal use of resources to grow the business and to satisfy the shareholders’ expectations.
Þ Management reporting to the board on business performance, current and future.
Þ Statutory reporting and support of investor relations.
Þ Audit and business risk management.
Þ Acting as a value adding business partner to all functions.
Leaf
The Leaf Department is responsible for purchasing, processing, packing, shipping, and store leaf.
Essentially, it is the Leaf Department’s job to ensure a secure, continuous and consistent supply of tobacco at the best cost and right quality (as required by our Blenders) to maintain the correct taste of final products for the consumer. Therefore, the Leaf Team’s skills make a significant contribution to the ongoing success and reputation of our brands.
Achieving this objective demands more than simply buying tobacco. The team manages the tobacco all the way from the grower’s selling floor to input into factory production.
A career in Leaf offers variety and responsibility. Our people are not just dynamic Managers, they are able to adapt to a multitude of environments and cultures. In addition, while an agricultural science background is a pre-requisite, extensive training in tobacco growing, buying and processing will be provided, involving initial farm training in Bangladesh.
Information Technology
With the emergence of super information highway and the ever evolving technological environment, a competitive advantage is created for our business. At British American Tobacco Bangladesh, we have a robust Information Technology team which provides critically important support service to all the other departments in BATB.
A career in Information Technology could see you contributing to BAT Bangladesh in a whole range of ways, from the general application of IT to specific advice on hardware and software; from the application of telecommunications for voice, data and video to solving complex, strategic business challenges in the internal external environment.
While a robust Information Technology infrastructure is a vital component of a dynamic and world class organisation, our people also have the imagination to create whole new ways of adding value to our business. Information Technology includes business area management, architecture & service delivery and IT Management.
Operation
Operations function is at the heart of our business, so we invest substantially in people and technology to ensure that our processes are state-of-the-art, highly flexible and responsive to the needs of our customers and consumers alike that helps us to retain customer.
Working in operations means constantly having to balance the demands of availability, quality and cost. Our people operate in a high speed environment and under tremendous pressure, so they need the strength of mind to make quick decisions, often basing them on limited information. They also need to be open to innovative solutions that can improve our processes. The three major components of our Operations department are:
Green Leaf Threshing Plant (GLTP): The company’s GLTP, set up in 1994, is in Kushtia. It prepares the green tobacco leaf procured by our Leaf team for further processing and manufacturing.
Primary Manufacturing Department (PMD) is responsible for further conditioning of the tobacco to make it ready for production at any time, at any environment.
Secondary Manufacturing Department (SMD) uses the tobacco, which is blended and conditioned by PMD, along with wrapping materials, to manufacture cigarettes.
Apart from producing a wide range of brands and SKUs, the department also takes care of security, procurement, logistics, technical maintenance, process and quality control, employee relations, and other aspects of the business. One significant aspect of our operations is the effort to ensure a working environment which complies with world-class Environment, Health and Safety (EHS) standards. A number of Zero Accident Awards from the BAT group head quarters stand testimony to the success in this regard.
Legal
The major activities of Legal and Secretarial includes litigation management, combat-illicit trade, trade marks & agreement management, in-house legal counsel, share management which is listed with two stock exchanges and operating under central depository system, company secretarial function, records management, shaping regulatory environment, trust fund management, policy compliance etc. Legal and Secretarial function also drives to ensure Corporate Governance in the company.
1.4 Existing Program of BATB
British American Tobacco Bangladesh offers very attractive international experiences for its people. Among the British American Tobacco group companies, BAT Bangladesh is well recognised and appreciated for the talent, energy and commitment of its employees. As recognition of this, a number o BAT Bangladesh Managers have been assigned to different BAT companies around the world. Please place the mouse cursor on the dots in the map below for a few such examples. They create a winning environment by doing things differently, utilizing everything they learn from practices around their world. A clear set of Employment Principles, which work in practice globally, unites us and demonstrates their commitment to making this a ‘great place to be’. They are guided by a set of employment principles that makes them the ‘Employer of Choice’ among many potential employees.
1.5 Future Program of BATB
Their future program is to achieve leadership of the global tobacco industry in order to create long term shareholder value. Leadership is not an end in itself, but a company that leads its industry, is the preferred partner for key stakeholders and is seen to have a sustainable business, should be valued more highly.
They define leadership in both a quantitative and qualitative sense. Quantitively, they seek volume leadership among their international competitors and in the longer term, value leadership.
But the hard, quantitative measures do not in themselves address all the things they must do as a company. They take a long term view, focusing on the quality of their business and how they work. As a result, qualitatively, they seek to be recognised as industry leaders and to be the partner of first choice for governments, NGOs, investors and potential employees.
In order to deliver otheir future plan, their strategy for creating shareholder value has four elements around which all our efforts revolve – Growth, Productivity, Responsibility and Winning Organisation.
Findings of the study
3.1 Nature of SHRM
Strategic human resource management is a complex process which is constantly evolving and being studied and discussed by academics and commentators. Its definition and relationships with other aspects of business planning and strategy is not absolute and opinion varies between writers. The definitions below are from the CIPD book Strategic HRM: the key to improved business performance1 within which there is comprehensive coverage of the various definitions and approaches to HRM, strategy and strategic HRM.
Strategic HRM can be regarded as a general approach to the strategic management of human resources in accordance with the intentions of the organisation on the future direction it wants to take. It is concerned with longer-term people issues and macro-concerns about structure, quality, culture, values, commitment and matching resources to future need. It has been defined as:
- All those activities affecting the behaviour of individuals in their efforts to formulate and implement the strategic needs of business.
- The pattern of planned human resource deployments and activities intended to enable the forms to achieve its goals.
Strategic HRM can encompass a number of HR strategies. There may be strategies to deliver fair and equitable reward, to improve performance or to streamline structure. However, in themselves these strategies are not strategic HRM. Strategic HRM is the overall framework which determines the shape and delivery of the individual strategies.
Boxall and Purcell argue that strategic HRM is concerned with explaining how HRM influences organisational performance. They also point out that strategy is not the same as strategic plans. Strategic planning is the formal process that takes place, usually in larger organisations, defining how things will be done. However strategy exists in all organisations even though it may not be written down and articulated. It defines the organisation’s behaviour and how it tries to cope with its environment.
Strategic HRM is based on HRM principles incorporating the concept of strategy. So if HRM is a coherent approach to the management of people, strategic HRM now implies that that is done on a planned way that integrates organisational goals with policies and action sequences.
3.2 Nature of corporate strategy
Corporate strategy is supposed to be the means by which an organization achieves and sustains success. Yet, it rarely rises to that level, despite an abundance of corporate strategy theory and significant research from many organizations over the past few decades. The changes over the years are considered in the form of small, theoretical refinements, rather than large and significant steps required for further management transition
The original meaning of the word strategy derives from the Geek strategia, which is used in the military terms and represents the ability to employ available resources to win a war. This interpretation has generated problems when such concept is used in a business context because it implies the existence, even the necessity, of opponents. As a result, most managers believed that a corporate strategy implies a strong focus on competition, since competition takes place almost exclusively at the offering level; most organizations concentrate their strategic efforts on constantly improving the goods and services they offer. This overemphasis on the temporary success, however, can often obscure the kind of thinking and emphasis that would lead to sustained success, even a continuous repetition of temporary successes doesn’t equate to sustainable strategy. In an effort to increase the value of single offerings, the organisation may be distracted from larger questions of structure, mission and objective (Papers4you.com, 2006).
In war, objectives can often be clearly defined, and so strategy is thought of as a means to a specific end. This view has persisted in the corporate world where strategies are conceived as plans to accomplish specific goals. Although corporate strategy can be very goal-oriented, especially in the early stages of a company’s development, the very nature of goals implies temporary success. By contrast, sustainable success is not, and cannot be an end unto itself or a goal to achieve. Therefore, goal orientation becomes arguably inappropriate when success has to be indefinitely sustained.
Despite this, an overwhelming number of top executives and researchers make extensive use of objectives in their quest of lasting corporate success. Certainly, a number of factors contribute to this: the need of leaders with limited tenure to point to achievements, the tyranny of meeting the expectations of the financial markets and most management teams extensively rely on forecasting and planning. Still, the idea held by most managers that strategy itself is all about goal achievement only exacerbates the situation. Therefore, it is important for strategists to remember that the more specific an objective, the further away it may potentially lead the organisation from its optimal big picture.
So how strategy should be redefined? Clearly it cannot rely too strongly on objectives nor can it focus too heavily on competition. A more fundamental concept is needed to guide an organisation in seeing its big picture, and such concept should be customer. To create sustainable, long-term success, an organisation must first and fundamentally understand and relate to its customers. It is the ongoing encouragement of this understanding, based on neither specific competitors nor temporal objectives, which must be at the heart of any real strategy. And it is that from which all objectives should naturally flow.
3.3 Recruitment & selection
Recruitment is the primary and very imporatnt function of SHRM
The main sources of recruitment are:
- Internal promotion and internal introductions (at times desirable for morale purposes)
- Careers officers (and careers masters at schools)
- University appointment boards
- Agencies for the unemployed
- Advertising (often via agents for specialist posts) or the use of other local media (e.g. commercial radio).
Where the organization does its own printed advertising it is useful if it has some identifying logo as its trade mark for rapid attraction and it must take care not to offend the sex, race, etc. antidiscrimination legislation either directly or indirectly. The form on which the applicant is to apply (personal appearance, letter of application, completion of a form) will vary according to the posts vacant and numbers to be recruited.
Before letters of appointment are sent any doubts about medical fitness or capacity (in employments where hygiene considerations are dominant) should be resolved by requiring applicants to attend a medical examination. This is especially so where, as for example in the case of apprentices, the recruitment is for a contractual period or involves the firm in training costs.
Interviewing can be carried out by individuals (e.g. supervisor or departmental manager), by panels of interviewers or in the form of sequential interviews by different experts and can vary from a five minute ‘chat’ to a process of several days. Ultimately personal skills in judgment are probably the most important, but techniques to aid judgment include selection testing for:
- Aptitudes (particularly useful for school leavers)
- Attainments
- General intelligence
In more senior posts other techniques are:
- Leaderless groups
- Command exercises
- Group problem solving
3.4 Strategies for recruitment & selection
BATB see recruitment as a part of their business strategy, ensuring that their company is equipped with managers of the highest caliber who can build their future. It is a long-term strategic exercise to continually improve the quality of management with a consistent focus on future requirements.
Year after year, they select, train and develop some of the brightest and most talented graduates.
Recruitment policy
Fig: Recruitment Process
Þ British American Tobacco Bangladesh has been in e-resourcing since 2002. They focus on e-based advertisement for more visibility and transparency beside the conventional print media. All recruitment related notices are posted on the www.bdjobs.com website. Candidates are required to fill up the blank resume format provided in the website. A well-structured and systematic selection procedure is followed to get the most suitable candidate. Following the selection procedure, pre-employment medical examination and reference checks are done.
Þ They entertain application from recognized universities from home and abroad.
Þ Applicant must be a citizen of Bangladesh.
Þ They encourage students with good academic track record to apply.
Þ They are not prejudiced against race, sex, religion, age etc. Positions will be offered to the candidate on the basis of his/her ability and the requirement of the company.
Þ If the one’s application is successful, he/she will be invited to a preliminary interview which will be taken by a member from the function to which he/she has applied and a member of the Human Resource team. This is a chance for him to find out more about them, as it is for us to find out whether he/she has the competencies they are looking for.
Þ As a final candidate, the person will be invited to a specifically designed British American Tobacco assessment centre. This will provide him the opportunity to demonstrate his/her skills and suitability through his/her performance in a number of participative and individual exercises. One will also have the opportunity to meet their managers and to gain first hand experience of what it is like to work for British American Tobacco Bangladesh. Regardless of the outcome, participants find it a unique opportunity to demonstrate their strengths.
Þ If one gets through the Assessment Centre, he/she will be recommended to the respective Heads of Functions for a final Interview.
Þ They are committed to keep the interviewee informed of his/her progress through every step of the selection process.
3.5 Strategic choices usually made
The strategic choices made by BATB are very clear. These are:
Þ They do not make a difference between man and woman; majority and minority etc.
Þ BATB both make and buy employees. At the entry level they prefer fresh graduates and at the middle and top level they prefer the skilled people.
Þ They provide a high for recruitment and training. Their arrangement of recruitment involves a set of steps mentioned earlier.
Þ BATB always follows the updated techniques and technologies in their recruitment system.
Þ They recruiting methods involve both internal and external. It varies from situation to situation.
3.6 Training and development of human resources
In general, education is ‘mind preparation’ and is carried out remote from the actual work area, training is the systematic development of the attitude, knowledge, skill pattern required by a person to perform a given task or job adequately and development is ‘the growth of the individual in terms of ability, understanding and awareness’.
Within an organization all three are necessary in order to:
- Develop workers to undertake higher-grade tasks;
- Provide the conventional training of new and young workers (e.g. as apprentices, clerks, etc.);
- Raise efficiency and standards of performance;
- Meet legislative requirements (e.g. health and safety);
- Inform people (induction training, pre-retirement courses, etc.);
From time to time meet special needs arising from technical, legislative, and knowledge need changes. Meeting these needs is achieved via the ‘training loop’. (Schematic available in PDF version.)
The diagnosis of other than conventional needs is complex and often depends upon the intuition or personal experience of managers and needs revealed by deficiencies. Sources of inspiration include:
- Common sense – it is often obvious that new machines, work systems, task requirements and changes in job content will require workers to be prepared;
- Shortcomings revealed by statistics of output per head, performance indices, unit costs, etc. and behavioral failures revealed by absentee figures, lateness, sickness etc. records;
- Recommendations of government and industry training organizations;
- Inspiration and innovations of individual managers and supervisors;
- Forecasts and predictions about staffing needs;
- Inspirations prompted by the technical press, training journals, reports of the experience of others;
- The suggestions made by specialist (e.g. education and training officers, safety engineers, work-study staff and management services personnel).
Designing training is far more than devising courses; it can include activities such as:
- Learning from observation of trained workers;
- Receiving coaching from seniors;
- Discovery as the result of working party, project team membership or attendance at meetings;
- Job swaps within and without the organization;
- Undertaking planned reading, or follow from the use of self–teaching texts and video tapes;
- Learning via involvement in research, report writing and visiting other works or organizations.
So far as group training is concerned in addition to formal courses there are:
- Lectures and talks by senior or specialist managers;
- Discussion group (conference and meeting) activities;
- Briefing by senior staffs;
- Role-playing exercises and simulation of actual conditions;
- Video and computer teaching activities;
- Case studies (and discussion) tests, quizzes, panel ‘games’, group forums, observation exercises and inspection and reporting techniques.
Evaluation of the effectiveness of training is done to ensure that it is cost effective, to identify needs to modify or extend what is being provided, to reveal new needs and redefine priorities and most of all to ensure that the objectives of the training are being met.
The latter may not be easy to ascertain where results cannot be measured mathematically. In the case of attitude and behavioral changes sought, leadership abilities, drive and ambition fostered, etc., achievement is a matter of the judgment of senior staffs. Exact validation might be impossible but unless on the whole the judgments are favorable the cooperation of managers in identifying needs, releasing personnel and assisting in training ventures will cease.
In making their judgments senior managers will question whether the efforts expended have produced:
- More effective, efficient, flexible employees;
- Faster results in making newcomers knowledgeable and effective than would follow from experience;
- More effective or efficient use of machinery, equipment and work procedures;
- Fewer requirements to implement redundancy (by retraining);
- Fewer accidents both personal and to property;
- Improvements in the qualifications of staff and their ability to take on tougher roles;
- Better employee loyalty to the organization with more willingness to innovate and accept change.
Training program at BATB
Training and Development is an ongoing process in British American Tobacco Bangladesh with the personal and professional development of their talent pool seen as a top priority in British American Tobacco Bangladesh.
They offer both on-the-job and off-the-job at both theoretical and practical levels with training and development opportunities provided through a range of local, Regional and International Training programmes that include training and development programmes at both functional and managerial levels.
“British American Tobacco Bangladesh’s approach to personal development is quite special”, said by the director of “The Leadership Trust’s International Programme” The Leadership Trust a globally recognized provider of leadership development. The primary focus on supporting personal development is unique, even from a global perspective, having worked with many leading multinational organizations. It is quite rare to see investment made at this level, and on this scale, with the prime focus being upon the personal development of the company’s key asset; its people.
Their Training and Development enables their employees to discover their own personal leadership skills and qualities in an enterprising, safe and supportive learning environment, which make working with British American Tobacco Bangladesh’s talented and emerging leaders both a pleasure and a privilege.
3.7 Promotional strategy
BATB always try to follow a logical promotional strategy. Logical strategy means what is fair, that is done. Every employee is promoted on the basis of their skills, qualification and experiences, innovativeness and some other criteria.
3.8 Career development strategy
Career development is the umbrella of a three stage process:
· Career planning (Self-assessment; Development Planning)
· Self development (Monitoring, Networking)
· Job search (Resume, Cover Letter, Informational Interview, and Job Interview).
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In BATB, Career development is a self-initiated process with support and resources provided by managers and the organization.
3.9 Strategic pay, rewards and benefits
The overriding objective of the British American Tobacco remuneration policy is to reward the achievement of corporate and individual goals by linking success in those areas to the group strategy: a balanced approach to achieving growth, improving productivity, managing the business in a responsible manner and developing a winning organisation. The delivery of strategy is measured by the Key Performance Indicators (KPIs) and Business Measures set out and described in the section of the Annual Review. The continued focus by the Executive Directors of British American Tobacco and the members of its Management Board on driving all four elements of the strategy, will continue to build a sustainable business.
In order to strengthen the alignment of executive remuneration to the generation of shareholder value, a balance is maintained between the short and long term elements of the structure.
3.9.1 Salary
Salaries for the Executive Directors and members of the Management Board are reviewed annually or on a significant change of responsibilities. In deciding appropriate salary levels, and to ensure competitive positioning, Executive Directors’ salaries are benchmarked against a mid-market level of main board directors from the Salary Comparator Group described above. Where necessary, additional reference is also made to published salary data, including that for positions for companies in the Salary Comparator Group.
Matched salary positions are identified and compared using factors chosen to cover comparative reporting levels, revenue, international responsibilities and main board membership. This enables a mid-market assessment and a ‘competitive range’ (typically 15 to 20 per cent either side of the assessment) to be reported to the Committee, which will then make judgements within this range depending on individual performance and experience.
Salaries of members of the Management Board are reviewed on the basis of a mid-market comparison for equivalent management board roles. Similar principles are applied to the salaries of senior managers and, below this level in the organisation, salary scales are graded with reference to market conditions whilst individual salary increases are linked to performance.
During 2006, the Committee continued to recognise that the requirements of recruitment or retention may on occasion justify the payment of a salary outside the range regarded as appropriate for a particular position.
In addition to basic salary, the Executive Directors and members of the Management Board receive certain benefits in kind, principally a car or car allowance and private medical and personal accident insurance. The Executive Directors also receive the benefit of the use of a driver.
3.9.2 Award levels
The Remuneration Committee continues to maintain a responsible approach to benchmarking and aims to set the total compensation opportunity for Executive Directors within the market competitive range, but with a conservative overall positioning. As part of the Review, the Committee decided to maintain a simple, focused incentive structure with only two elements of variable pay. This methodology is in contrast to a number of FTSE 100 companies which may operate two or, in a few cases, three different long term incentive plans in the same year. The Remuneration Committee believes that the Company’s approach will provide a clear message to participants of what is required and will be transparent to shareholders.
The Remuneration Committee has an established peer group for benchmarking purposes, made up of FTSE 100 companies with a consumer goods focus, an international spread of operations and competitors for top management talent. This group of UK listed companies (the Salary Comparator Group) has been used for a number of years to ensure that base salaries and total compensation continue to be market competitive and is subject to annual review.
The opportunity provided by the total package was compared against the Salary Comparator Group on both an expected and projected value basis, taking into account the value of the LTIP Dividend Equivalent. Under both these approaches, the total compensation opportunity for the Executive Directors, and in particular the Chief Executive, was positioned appreciably below the mid-market.
To ensure that remuneration levels remain competitive (subject to the approval of shareholders), awards under the New LTIP will therefore be increased from 175 per cent to 250 per cent of base salary for the Chief Executive, and from 125 per cent to 200 per cent of base salary for the Finance Director and the Chief Operating Officer. In this way, the total package continues to be positioned appropriately against the market.
The level of award for members of the Management Board will also be increased from 125 per cent of salary to 150 per cent of salary.
In order to provide flexibility and sufficient capacity for future awards over the life of the Plan, the individual limit will be increased to 300 per cent of salary. The Remuneration Committee does not anticipate that awards will be made up to this limit in normal circumstances, and there is no current intention to utilise this limit by making awards in excess of the proposed levels. The Remuneration Committee will advise shareholders in advance of any change in the current proposed award levels, and any such change will be disclosed in the Remuneration Report.
3.9.3 Other benefits
Equal opportunity and diversity policy
This policy ensures Equal Opportunity & Diversity to all who are working at British American Tobacco Bangladesh. British American Tobacco Bangladesh, is committed in providing Equal Opportunity and promoting Diversity through ensuring that no discrimination is being done to any employee and any job applicant based on age, ethnicity, gender, race, religion, smoking habits or disability- subject to the inherent requirements of the role to be performed, level of performance of the individual and viability of the job in respect to the state of the business.
Maternity leave policy
In BAT Bangladesh they value their employee’s personal priorities. They allow maternity and paternity leave in their organisation. Their maternity leave of 6 months has allowed their female manager to balance her career aspiration with her role as a mother. They also have a provision for 2 weeks paternity leave policy for our male managers.
Education assistance policy
BATB offer Education Assistance to their people so that they can pursue on with their higher studies and fulfill their dreams. Under this policy their managers can avail 50% of their education expenses. A number of their managers are doing their MBA, CIMA and other professional degrees under this policy.
3.10 Strategic performance evaluation methods
An organization needs constantly to take stock of its workforce and to assess its performance in existing jobs for three reasons:
- To improve organizational performance via improving the performance of individual contributors (should be an automatic process in the case of good managers, but (about annually) two key questions should be posed:
- what has been done to improve the performance of a person last year?
- and what can be done to improve his or her performance in the year to come?).
- To identify potential, i.e. to recognize existing talent and to use that to fill vacancies higher in the organization or to transfer individuals into jobs where better use can be made of their abilities or developing skills.
- To provide an equitable method of linking payment to performance where there are no numerical criteria (often this salary performance review takes place about three months later and is kept quite separate from 1. and 2. but is based on the same assessment).
In BATB, on-the-spot managers and supervisors, not HR staffs, carry out evaluations. The personnel role is usually that of:
- Advising top management of the principles and objectives of an evaluation system and designing it for particular organizations and environments.
- Developing systems appropriately in consultation with managers, supervisors and staff representatives. Securing the involvement and cooperation of appraisers and those to be appraised.
- Assistance in the setting of objective standards of evaluation / assessment, for example:
- Defining targets for achievement;
- Explaining how to quantify and agree objectives;
- Introducing self-assessment;
- Eliminating complexity and duplication.
- Publicizing the purposes of the exercise and explaining to staff how the system will be used.
- Organizing and establishing the necessary training of managers and supervisors who will carry out the actual evaluations/ appraisals. Not only training in principles and procedures but also in the human relations skills necessary. (Lack of confidence in their own ability to handle situations of poor performance is the main weakness of assessors.)
- Monitoring the scheme – ensuring it does not fall into disuse, following up on training/job exchange etc. recommendations, reminding managers of their responsibilities.
Basically an evaluation / appraisal scheme is a formalization of what is done in a more casual manner anyway (e.g. if there is a vacancy, discussion about internal moves and internal attempts to put square pegs into ‘squarer holes’ are both the results of casual evaluation). BATB is always trying to search out and build the talents within the organization. The managers approve merit payment and that too calls for evaluation. Made a standard routine task, it aids the development of talent, warns the inefficient or uncaring and can be an effective form of motivation.
3.11 Strategic grievance handling
While handling grievances one must know the answers of some questions. After that, he/she can decide about the procedure of handling grievances. These questions are:
In BATB, they always try to solve the problems in a systematic manner. In handling grievances the following procedures are maintained:
- The grievance procedure
- Utilizing steps in the grievance procedure
- Managing and adhering to deadlines
- The impact of noncompliance with grievance procedures
- Enforcing compliance with deadlines and processes
- Grievance processing
- Documentation best practices
- Drafting grievance responses
- Conducting the grievance meeting to secure maximum benefit for management
- Strategic grievance handling
- Assessing the strengths and weaknesses of your case
- Assessing the strengths & weaknesses of the union’s case
- Identifying the union’s motivation for pursuing a grievance
- Evaluating the grievance in the context of the “big picture”
- Operational ramifications and financial implications
- Possible perceptions of management, the union, and rank-and-file
- Grievance settlement
- Generating and evaluating your settlement options
- Negotiating grievance settlements
- Reducing negotiation settlements to writing
- Making the decision to arbitrate
3.12 Strategic collective bargaining process
Collective bargaining process is a continuous process. A collective bargaining agent should do the following things:
- Provide assistance in setting strategic bargaining objectives and lead Employer caucus discussions.
- Draft contract language.
- Act as chief spokesperson and lead the conduct of collective bargaining in accordance with strategic objectives.
- Provide an effective liaison and interface with government in order to facilitate the development of mandates and to ensure adequate funding on behalf of the participating organizations.
- Represent member organizations at conciliation.
- Provide support in strike planning and strike management activities.
The human resources staff of BATB provides the following services by way of support to the collective bargaining process:
- Maintain collective agreement wording, wage comparison information and relevant comparator collective agreements in a database.
- Prepare comprehensive research on wages and benefits and current issues in order to adequately support collective bargaining activities.
- Develop a collective agreement costing program in order to estimate the monetary impact of collective agreement changes
The Human Resources Consultant also provide day-to-day labor relations and legal advice to the member facility as follows:
- Advise and assist members in the day-to-day interpretation and application of the language of collective agreements.
- Research and provide legal opinions on a wide variety of labor relations issues.
- Represent clients at various meetings with Union representatives, government officials and representatives of other industries.
Provide orientation and education for managers on the application and interpretation of collective agreement provisions when requested by a participating organization
3.13 Limiting the activities of trade union
A trade union or labor union is an organization of workers who have banded together to achieve common goals in key areas such as wages, hours, and working conditions, forming a cartel of labour. The trade union, through its leadership, bargains with the employer on behalf of union members and negotiates labour contracts with employers. This may include the negotiation of wages, work rules, complaint procedures, rules governing hiring, firing and promotion of workers, benefits, workplace safety and policies. The agreements negotiated by the union leaders are binding on the rank and file members and the employer and in some cases on other non-member workers. There is no trade union in BATB.
3.14 Strategy for improving productivity
BATB’s overall approach to productivity is about using their global resources to increase profits and generate funds for reinvesting in their business in the global arena.
Today, all companies are trying to cut costs. Their approach is integrated – aiming to establish a lower cost base while improving the quality of products and the speed they get to the market, as well as their effectiveness in terms of how they deploy their people and capital.
To remain competitive, it’s important to reduce the complexity and costs across their entire supply chain, while also improving our service to retailers and ensuring product freshness and integrity. They have programmes in place to find reductions in their Overheads and Indirects (anything they spend money on other than leaf, wrapping materials, cigarette making machinery and permanent labour costs) and make the most of their global buying power.
As a Group focused on their consumers, marketing is a large part of what they do and they are working to ensure they effectively and efficiently deploy their marketing resources.
In order to maintain a strong balance sheet, capital effectiveness is an important part of their productivity strategy and includes a focus on inventory levels, utilising their assets, financing and other uses of capital.
Chapter four: Conclusion & recommendations
4.1 Conclusions
BATB basically follows the updated process in their every activity. They always search for talents. Their remuneration package is also attractive. They , actually motivate young people to enter into decision making process. SHRM is a broad issue. There are a lot of issues involved in SHRM. BATB emphasizes all the activities of SHRM.
Recommendations
Although it is very difficult for us to suggest a multinational company like BATB, we have tried to recommend on some issues, as follows:
Þ Their source of recruitment should be more spread.
Þ They should consult with the universities in the country seriously and share their views and experiences.
Þ They have arranged different competition program for searching talents. These programs should be more frequent.
Þ Training and development process should be more efficient.
Bibliography
Books
1. Dr. M. Ataur Rahman; Human Resource Management; 1st edition.
2. S. P. Gupta & M. P. Gupta; Business Statistics; 20th revise edition
3. C. R. Kothari; Research Methodology; 2nd edition.
4. Keith Davis; Human Resource Management.
5. Michael Armstrong; Human Resource Management Practice; 10th edition.
Journals
1. Verena Veneeva; The Meaning and Importance of Corporate Strategy.
2. Ken Margolies; Strategic Grievance Handling
3. Michael Terry; HRM Practice.
Websites
3. www.batb.com
4. www.wikepledia.com and so on.