UTILIZATION OF MARKETING IN HUMAN RESOURCES MANAGEMENT

Transcription

1 Journal of Information, Control and Management Systems, Vol. 6, (2008), No UTILIZATION OF MARKETING IN HUMAN RESOURCES MANAGEMENT Marta WILCZKOVÁ, Kateřina MATUŠÍNSKÁ Silesian university, School of Business Administration in Karviná, Czech Republic wilczkova@opf.slu.cz, matusinska@opf.slu.cz Abstract The article deals with practical application of the system analysis with the use of system archetypes on the solution of the issue of supply and especially demands on the labour market. Furthermore, it focuses on using a marketing approach in the question of job vacancy supply and human resources management in companies which have a lack of employees. The article describes furthermore the potentialities of effective Employees Relationship Management (ERM) application with the help of marketing instruments and procedures. Keywords: employees Relationship Management (ERM,) labour market, Human Resources Management, systems analysis, systems archetypes, marketing mix 1 INTRODUCTION In relation with the globalizing world, the competition on markets with products and services also grows and increases the competition at the labour market. This leads to a situation at the labour market when job offices register sufficiency of suitable applicants of selected professions (workers, low-qualification professions) and companies do not have enough suitable applicants. Companies solve this situation by offering higher wages and by employing workers from abroad (especially from Poland, Slovakia and recently even from Vietnam [8, 9]). At the suggestion of the Ministry of Labour and Social Affairs, the company CCcentre, s. r. o., carried out a sociological survey [7] concerning employing foreign workers. The survey was executed at the turn of 2006 and 2007 and it was placed by the EURES 1 network where employers advertise their job offers in EU/EEA countries. 1 The purpose of EURES (European Employment Services) is to provide information, advice and recruitment/placement (job-matching) services for the benefit of workers and employers as well as any citizen wishing to benefit from the principle of the free movement of persons. EURES has a human network of more than 700 EURES advisers that are in daily contact with jobseeker and employers across Europe. In European cross-border regions, EURES has an

2 124 Utilization of Marketing in Human Resources Management The survey included companies with more than ten employees and their selection was random. 600 respondents were questioned in total. The aim of the research of Czech employers needs for employing foreign workers, especially from EU/EEA member countries was to map the actual situation on the Czech market with job vacancies and to find out under what circumstances companies employ foreign workers or on the contrary, do not offer vacancies to foreign workers. The results of the research show that there is a great interest in foreign employees on the domestic labour market in the field such as qualified workers, machine operators, drivers, technical and health workers with secondary education and highly qualified professionals with university education. A quarter of the questioned companies stated that there have been foreign employees in the company. They were mainly large companies, companies with foreign ownership and companies with international activity. There were mostly qualified workers, machine operators and drivers (41%) or highly qualified professional with university education (29%). As for nationalities, they were mainly from Slovakia (46%), then from Poland (13%) and Ukraine or Russia (13%). The report states that to contact potential employees, companies use mainly job offices (61% of companies), then advertising in the press (47%) and on the Internet (38%). An important method, which is often neglected, is reference by the existing employees (30%). The conclusions of the research imply that companies agree in their opinion on the development of future demand for selected categories of workers. Organizations assume that there will be growing demand especially for the category of qualified workers, machine operators and drivers. There will also be job vacancies at positions of qualified professionals with university education and technical and health workers with secondary education. The presented data imply that there is a lack of workers on the labour market, although statistics show quite a high unemployment rate in some regions (e.g. Moravian-Silesian region). The problem is that sufficient job vacancies do not guarantee a decrease in the unemployment rate. There are two basic causes. Firstly, it is the non-motivating social system which does not stimulate the unemployed to look for a job and to participate actively in working process. The conditions set for social benefits motivate the unemployed to use the possibilities of the social security system important role to play in providing information about and helping to solve all sorts of problems related to cross-border commuting that workers and employers may experience. Set up in 1993, EURES is a co-operation network between the European Commission and the Public Employment Services of the EEA Member States (The EU countries plus Norway, Iceland and Liechtenstein) and other partner organisations. Switzerland also takes part in EURES cooperation. The joint resources of the EURES member and partner organisations provide a solid basis for the EURES network to offer high quality services for both workers and employers.

3 Journal of Information, Control and Management Systems, Vol. 6, (2008), No as long as possible. This fact concerns mainly working professions and people with low qualifications where the difference between the wages and social benefits is quite small. E.g. there can be problems with recruiting employees in larger companies. Presently the example includes engineering company ČZ Strakonice [8, 9] which employs 15 % foreign employees from its total employees number. Secondly, unemployment stagnation or its growth is caused by the structural incompatibility of supply and demand on the labour market. It concerns mainly the demand for qualified workforce, such as doctors, nurses, programmers etc. These are areas where our professionals take the opportunities of working abroad and there is an insufficient supply on the Czech labour market. 2 PROBLEM ANALYSIS Many companies find looking for suitable job applicants difficult. Companies use a short-term solution of the described problem which is a traditional economic approach when the situation of the excess demand over supply is solved through a simple increase in the price for work, i.e. wage. The expected effect should be a restoration of balance on the labour market. It is necessary to point out that this solution is only short-term as such a procedure increases wage costs which are reflected in the pricing of goods or services. As a result, competitiveness of the company on the product and service market can decrease. Another problem is the fact that a higher wage or salary does not automatically guarantee employee s loyalty and the employee, into whom the company invests money in the form of training and education, leaves for an offer of higher wage at a competitor. To describe and analyze the problem, method of system archetypes was used. This method was published in Peter Senge s book The Fifth Discipline. The Art and Practice of the Learning Organization (1990) which was translated into Czech in The method of system archetypes is based on causal loop maps. There are two basic [4] types of retroactive processes: refreshing (labelled with R) or intensifying and balancing (labelled with B) or equalizing. Within the system, the refreshing retroaction causes growth and balancing retroaction can be seen where there is behaviour oriented towards goals. Another important term is delay (labelled D) which causes a gradual and slow consequence of a particular behaviour so that the actual consequences of a decision can be unexpected for the company. Another factor which is important for the description of the system is the system borders [5, 6]. The system borders determine the possibilities of direct influence. Their significance is obvious from Picture No. 1 where activity of one company, in our case increasing wages of employees of whom there is a lack on the market, can lead to a subsequent reaction of other companies. As a result, price of work increases which represents increased costs for all companies. The mentioned problem is also related to offer of jobs for school-leavers [10] because companies try to make a proposal of better paid jobs than their competitors.

4 126 Utilization of Marketing in Human Resources Management Senge calls this problem the archetype of escalation. A solution could be transferring the fight for employees from the price or wage area into the area of offered values and satisfaction of the employee s needs. Company A Number of new employees Company B Number of new employees Wage-increase B Labour price at the market B Wage-increase Figure 1 Escalation the uncontrolled wage rising in companies causes wage level rising generally in the marketplace (modified by [4]) Non-systematic increase of wages at the company level can lead to dissatisfaction of other employees who often get only limited information on the benefits and significance of individual workers, or professions for the company. Insufficient knowledge and attention paid to the level of employees satisfaction result in the decrease of the loyalty level and can cause disloyal behaviour of employees. Such behaviour is shown in Figure No. 2; it can be a departure of an employee due to a job offer for higher wage. Senge calls the described archetype corrective measures which have deplorable consequences or do not work. Number of employees B Wage level D R Loyalty rate Figure 2 Corrections, which will be paid for dearly (modified by [4])

5 Journal of Information, Control and Management Systems, Vol. 6, (2008), No POTENTIAL EMPLOYEES RELATIONSHIP MANAGEMENT (ERM) There is a specific group of customers who make purchase decisions in terms of product price and other additional advantages. The bargain-hunting and low brand and company loyalty are typical for these customers. It is possible to observe a similar phenomenon at the market of products and services. Marketing approach draws attention to situation when too low price is taken into account as competitive advantage. The company has to know who its customers are and their demands if this company takes interest in correct and long-time customer s relations creation. It is also necessary to take into account complex perception of working position as well as corporate culture as a whole. Senge is said to indicate the situation when the company solves only symptoms and misses out the basic problem as an archetype of burden transfer. Wage level B Number of employees B R D Loyalty rate ERM Figure 3 Burden transfer - Employees Relationship Management (modified by [4]) It results from given facts that the company should deal with Employees Relationship Management systematically. It means that human resources management process (i. e. labour recruitment and selection, training, motivation, checking and

6 128 Utilization of Marketing in Human Resources Management evaluation) should be realized according to company strategy and above all with the use of adequate marketing instruments. 4 DECISIVE TASK OF MARKETING IN THE SPHERE OF HUMAN RESOURCES MANAGEMENT Marketing [1] is defined as a social and managerial process by which individuals and groups obtain what they need and want through creating and exchanging products and values with others. In the case of human resources management the supply of work means set of values, which are able to satisfy potential and present employee s demands. The companies aim more and more at finding, analyzing and post-application of information connected with the systems of employees values and needs. The companies should do their best to have satisfied employees who don t work only because of money. K Nordström and J. Ridderstråle [3] mention: By having the set of clear values and ability to spread them, the organization can choose and attract mainly people who sympathize with its opinions (people). They work for companies which are in agreement with their system of values. Authors also argue that people want to walk with risen head when they are among friends. They try to avoid the awkwardness when they mention their employer. Marketing has got an important position in relation between company and customer. Therefore it can be said that similar approach will be also effective in the sphere of work supply. The work is not only the existing working position but even further - corporate culture, vision, working environment, workmates and company as an integrated system must be taken into account. That means the first stage of successful implementation of ECR into practice is learning contemporary and potential employees needs, opinions and desires. There is unwillingness and distrust of this type of marketing research realization in most companies as well as in the case of manufacturing companies and companies providing services, which need to learn customers needs. At present the manufacturing conception is the most typical (the company supposes that it is the best and the only employer in all labour market and it doesn t take into account the propriety of its job offer). But we can also meet rarely the sales conception (fortunately the some companies start being more and more conscious of competition in labour market but they are still sure and persuaded that are able to find suitable employees in any case if they need. However it is not possible to consider the marketing conception in the sphere of human resources management without existence of proper marketing research realization. Next stage is intradepartmental environment analyse of company from the point of jobs offer and its comparison with competitive offers of other companies in the market. Therefore the exploration of the other companies with the demand for employees with the same or similar qualification as our company is necessary. The

7 Journal of Information, Control and Management Systems, Vol. 6, (2008), No method of benchmarking seems to be the most acceptable in this case to find out the best examples of proper marketing principles implementations in the sphere of human resources management in practice. Regarding mentioned analyses the company is able to find out its strengths and weaknesses, threats and opportunities and subsequently this knowledge and other marketing instruments (marketing mix) should be put into effect properly in the sphere of ERM. Marketing mix is collection of tactical marketing instruments enabling to adjust the supply according to customers desires at target market. To be specific - product, pricing, distributive and communication policies are used. The application of above mentioned approach could be hardly implemented in the case of human resources management because of traditional marketing mix use in practice. First of all it is the question of traditional price indication, which is paid for required products and services by customers. Contrariwise the customer - employee pays for product - performed work. Table 1 The marketing instruments application in the sphere of ERM MARKETING MIX PRODUCT PRICE PLACE PROMOTION EMPLOYEES RELATIONSHIP MANAGEMENT (ERM) Package of advantages offering by the company company image and brand, working position, working group, financial and non-financial benefits. The work done by employee work achievement and maintenance costs in comparison with alternative employee s opportunities (e.g. benefit of the unemployment). Workplace, the use of Internet access, the use of employment agents services. The communication process, the selection of commercial media and marketing communication instruments aiming at informing, persuasion and reminding of good company work conditions. MIX OF CUSTOMER 4C CUSTOMER BENEFITS TOTAL CUSTOMER COSTS CONVENIENCE COMMUNICATION According to above-mentioned reason it is better to apply the system of instruments 4C. The marketing orientated companies try to realize the programme

8 130 Utilization of Marketing in Human Resources Management 4C in their activities, which can be replaced with marketing mix 4P. System 4C, in comparison with marketing mix being called 4P, targets more the customers. Programme 4P describes the supply rather from the point of company and therefore it is not so much suitable to be applied in practice. System 4C consists of the following categories: - Customer benefits total benefit for customer - employee (in our case). - Total customer costs total (together with nonfinancial) costs spending on work obtaining and maintenance. - Convenience comfort related to work operation. - Communication mutual communication between company and employees. The last stage of Employees Relationship Management (ERM) is checking and evaluation of the effective usage of marketing instruments. E.g. within the evaluation of Place as a marketing instrument, there is a requirement to assess the usage of services offering by agents and spending on agency, then spending on equipment of workplace, the possibilities of part-time jobs (very actual nowadays) and work which can be done at home. Within the evaluation of Promotion as another marketing instrument, the effective usage of various commercial media will be also assessed. There are various methods dealing with the evaluation of effectiveness which can be found in most marketing textbooks [1, 2]. It is worth making a mention of method SERVQUAL [2] which is concerned with the evaluation of service quality. But in spite of this fact method SERVQUAL could be also modified for the use of ERM. 5 CONCLUSION In relation with the globalizing world of products and services there are crucial threats of competition growth for all companies at the labour market. It is more and more difficult task to find acceptable employee. It is only possible to take K. Nordström s and J. Ridderstråle s point [3] that in the present globalize market the tailor-made approach must be considered to attract and maintain good women and men... We transfer ourselves to each employee s tailor-made management. The consequences are that is necessary to personify every minuteness. People can be guided, evaluated, awarded, motivated and inspired in many ways. The application of marketing approach, in the sphere of human resources management, seems to be effective in the cases when the companies offer work but on the other hand there is not adequate number of acceptable applicants for job. The proper application of marketing approach, procedures and instruments to present and potential employees is the way how to be competitive at the labour market and improve position at the market of products and services through productivity and quality increase and faster innovation.

9 Journal of Information, Control and Management Systems, Vol. 6, (2008), No REFERENCES [1] KOTLER, P., ARMSTRONG G.: Marketing. Grada Publishing. Praha [2] MORRISON, A., M.: Hospitality and Travel Marketing. 3rd edition, Delmar. New York [3] NORDSTRÖM K., RIDDERSTRÅLE J.: Funky business. Grada Publishing. Praha [4] SENGE, P.: Pátá disciplína. Teorie a praxe učící se organizace. Management Press. Praha [5] WOLSTENHOLME E.: Towards the definition and use of a core set of archetypal structures in system dynamics. In System Dynamics Review [6] WOLSTENHOLME E.: Using generic system archetypes to support thinking and modelling. In System Dynamics Review [7] [8] [9] [10]

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