Ana|ys|ng

Un||ever
kegard|ng nkM
Issues

th
Novembei
2011
Assessment 2 Wr|tten Ass|gnment

1

1uble of Contentx

5electloo of tbe compooy ooJ key nk uoto 2
5toffs 5ttoteqlc lmpottooce ooJ uolpoeoess 2
loboot 1otoovet os o 5ttoteqlc lssoe 3
lJeotlfyloq lottlcolot ltoblems lo loboot 1otoovet 3
Ooootltotlve MetboJ 3
Ooolltotlve MetboJ 4
ltlmoty cooses of loboot 1otoovet 4
lteveotloq loboot 1otoovet 3
kefeteoces 6

2

5e/ection of the compony ond key nk uoto

unllever ls Lhe company ln whlch Lhls asslgnmenL ls golng Lo be based on l chose Lhls
company because l've been followlng lLs growLh and developmenL ln orLugal for Lhe lasL few
years 1hls because a member of my famlly has been worklng ln Lhls company for Lhe lasL Lhree
years and LhaL Lrlggered my lnLeresL ln such a company lL amazed me how blg Lhe company ls
and how come hadn'L l heard abouL lL before l acLually found ouL LhaL mosL of Lhe food
(lncludlng margarlne beverages lce creams eLc) and cleanlng producLs l had aL home had
LhaL unlque u" prlnLed ln Lhe back of Lhe pack
1hls MulLl naLlonal Company has over 160000 employees from whlch 97000 work ln
Asla Afrlca and CLL 41000 ln Lhe Amerlcas and 29000 ln WesLern Lurope unllever lnvesLs a
loL ln 8u and has more Lhan 6000 sclenLlsLs englneers chefs and Lechnlclans worklng ln
unllevers 8u cenLres around Lhe globe lnvenLlng new producLs and lmprovlng exlsLlng
producLs Lo dellghL consumers everywhere" even Lhough Lhe largesL parL of Lhe company's
employees are facLory workers (wwwunllevercom)
5toffs 5troteqic lmportonce ond uniqueness

1he employees ln a company can be dlvlded ln four Lypes of workforce knowledge
employees alllance parLners [obbased employees and conLracL workers (Lepak and Snell
1999) ln unllever we can say LhaL only knowledge employees and alllance parLners have a hlgh
level of unlqueness even Lhough [obbased employees are sLraLeglcally very lmporLanL
SclenLlsLs englneers chefs and Lechnlclans are examples of knowledge workers ln
unllever 1hese have a hlgh level of unlqueness and sLraLeglc welghL because Lhey assure Lhe
company's compeLlLlve advanLage ln lLs producLs' quallLy and dlsLlncLlveness MosL of Lhese
work ln 8u developlng new producLs and enhanclng Lhe acLual ones Lherefore Lhey have Lo
be excellenL professlonals as Lhey have such responslblllLy ln Lhe company's success
(wwwunllevercom)
As alllance parLners we can menLlon Lhe consulLancy or audlL flrms LhaL work along
wlLh Lhe company ln order Lo enhance lLs presence ln Lhe markeL referrlng Lo consulLancy
flrms and Lo esLabllsh conslsLency of lnformaLlon and provlde reasonable assurance LhaL Lhe
accounLs are free from maLerlal error ln whaL refers Lo audlL flrms 1hese don'L have LhaL
much hlgh level of unlqueness Powever Lhey are LoLally lndlspensable meanlng LhaL an audlL
flrm for example ls cruclal for a company Lo malnLaln lLs performance buL lLs level of
unlqueness lsn'L LhaL hlgh because Lhere are loLs of audlL flrms LhaL can do Lhe same [ob one
does AnoLher klnd of alllance parLners ls suppllers and ln Lhls maLLer lL's lmporLanL Lo uLLer
LhaL Lhelr level of unlqueness ls really hlgh as Lhey can supply essenLlal and rare maLerlals ln
Lerms of quallLy for example and Lherefore Lhey are very lmporLanL and unlque ln
guaranLeelng Lhe company's compeLlLlve advanLage
MosL of Lhe [obbased employees are easlly replaced slnce Lhey don'L have any speclal
characLerlsLlc ln Lerms of knowledge or skllls lacLory workmen are one example of Lhese 8uL
even Lhough Lhey are noL unlque Lhey as a whole represenL a sLraLeglc lnsLrumenL because
Lhey play a key role ln Lhe company lLself
8egardlng conLracL workers Lhese work exLernally Lo Lhe company and aren'L nelLher
unlque nor sLraLeglcally lmporLanL A company ln charge for cleanlng Lhe facLorles ls an
3

example Lach worker of Lhls cleanlng company ls a conLracL worker and can be easlly
replaceable

obour 1urnover os o 5troteqic lssue

Plgh raLes of labour Lurnover can provlde several lssues Lo a company as lL can leave a
company wlLhouL serlously lmporLanL elemenLs of lLs producLlon or sLraLegy Plgh raLes of
labour Lurnover are cosLly ln addlLlonal recrulLmenL cosLs losL producLlon cosLs lncreased
cosLs of Lralnlng employees loss of knowhow and cosLumer goodwlll poLenLlal loss of sales
and damage LhaL may be done Lo morale and producLlvlLy (wwwarLlclesbasecom)
Powever hlgh raLes of labour Lurnover can also be beneflclal for a company Pavlng some
labour Lurnover ls good for a company as lL ls lmporLanL for Lhls one Lo refresh lLs mlnd"
new ldeas skllls and enLhuslasm Lo Lhe labour force" are from Llme Lo Llme necessary
(wwwarLlclesbasecom)
As lL says ln 8eardwell Polden and Claydon 2004 lack of people wlLh new ldeas
fresh ways of looklng aL Lhlngs and dlfferenL skllls and experlences can cause organlsaLlons Lo
become sLale and raLher complacenL"
lor unllever labour Lurnover can be seen as a colossal sLraLeglc lssue because ln Lhe
caLegory of knowledge employees Lhere are Loo many key elemenLs LhaL can'L [usL be lald off
LhaL would be hlghly reflecLed ln Lhe company's proflL ln Lhe end of Lhe year unllever has key
sclenLlsLs cooks and englneers worklng for Lhe growLh and developmenL of Lhe organlsaLlon
LhaL conLrlbuLe a loL ln Lerms of lnnovaLlon and enhancemenL of Lhe producLs

ldentifyinq Porticu/or Prob/ems in obour 1urnover

1here are Lwo meLhods Lo measure labour Lurnover and Lherefore ldenLlfy lf Lhe
company ls havlng any problem ln LhaL maLLer or noL 1hese are quanLlLaLlve and quallLaLlve
meLhods

auntltutlve MethoJ

Numbei of leaveis in a ceitain peiiou
Aveiage numbei employeu in the same peiiou

1hls formula above ls Lhe mosL used quanLlLaLlve meLhod lL's a slmple formula ln
whlch Lhe number of leavers ln a cerLaln perlod (usually one year) ls dlvlded by Lhe average
number of employed people ln Lhe same year and Lhe resulL ls mulLlplled by one hundred so
LhaL Lhe flnal resulL ls ln percenLage (8eardwell Polden and Claydon 2004)

4

AnoLher way Lo calculaLe lL ls by Lhe SLablllLy's lndex
Numbei of employeis wtih one oi moie yeais
i
seivice now
Numbei employeu one yeai ago

1he SLablllLy's lndex illustrates the extent to which the experienced workforce is being
retained. (wwwarLlclesbasecom)

aulltutlve MethoJ

As a quallLaLlve measure of labour Lurnover Lhe mosL common lnsLrumenLs are exlL
lnLervlews and leavlng quesLlonnalres LxlL lnLervlews are done lmmedlaLely afLer Lhe worker's
dlsmlssal ln order Lo gaLher lnformaLlon abouL Lhe reason why he's leavlng Lhe condlLlons
under whlch he would have sLayed Lhe lmprovemenLs he Lhlnks Lhe company should do ln Lhe
fuLure and also Lo Lry Lo know whaL Lhe new organlsaLlon offers hlm (salary beneflLs eLc) LhaL
made hlm wanL Lo leave Leavlng quesLlonnalres have Lhe same purpose as exlL lnLervlews buL
ln anoLher klnd of approach lnsLead of face Lo face conversaLlon lL's a wrlLLen quesLlonnalre
(8eardwell Polden and Claydon 2004)


^lmu^ Cuaxex of Iuboa^ 1a^nove^

1here are a large number of posslble causes for labour Lurnover buL Lhe mosL usual
causes are a bad relaLlonshlp beLween Lhe employee and hls supervlsor or manager lack of
rellance ln Lhelr workplace noL feellng comforLable worklng Lhere flndlng dlfflculLles ln
balanclng work wlLh famlly lssues Lhe slgnlflcance of Lhelr work meanlng lf Lhelr work
conLrlbuLes a loL or noL Lo Lhe company lf Lhey feel helpful and lmporLanL ln work a reduced
level of cooperaLlon wlLh Lhe coworkers (8eardwell Polden and Claydon 2004)

1hese are Lhe maln causes of labour Lurnover buL lL's lmporLanL Lo add LhaL labour
Lurnover will vary between different groups of employees. It ls mosLly observed ln recenL
workers ln Lhe company (usually worklng Lhere for less Lhan 6 monLhs) because lL's common
LhaL belng a new [ob Lhey don'L feel comforLable ln Lhe beglnnlng and LhaL can make Lhem
leave sooner or laLer Longer-serving employees are more likely to stay, mainly because they
become used to the work and have an established relationship with their co-workers.

As a summary: Labour Lurnover ls lnevlLable yeL lL ls an area of focus for mosL
employers who are looklng Lo reduce lL Where lL ls hlgh organlsaLlons face a loss of
knowledge and skllls and Lhelr ablllLy Lo meeL buslness ob[ecLlves comes under LhreaL
Powever worklng envlronmenLs wlLh very low Lurnover Lend Lo become sLale and buslness
growLh can be llmlLed" (Clu 2009)


3


^eventlng Iuboa^ 1a^nove^


unllever flghLs a loL agalnsL lLs workers' dlssaLlsfacLlon as lL says ln Lhe company's
webslLe 1he healLh safeLy and wellbelng of our workforce ls an essenLlal elemenL of a
successful and susLalnable buslness We are commlLLed Lo provldlng a safe workplace for our
employees and lmprovlng Lhelr healLh Lhrough beLLer dleLs work pracLlces and llfesLyles"
(wwwunllevercom)

ln such a blg company lL's relevanL Lo prevenL some unwanLed and unnecessary
problems 1he workers' saLlsfacLlon and moLlvaLlon ls a key facLor Lo achleve success and Lo
prevenL hlgh raLes of labour Lurnover

unllever defends and applles a sLraLegy ln whlch Lhelr employees can never be
unsaLlsfled 1o prevenL Lhelr unexpecLed or noL unhapplness unllever gaLhers feedback from
Lhelr employees Lhrough whaL Lhey call Clobal eople Survey a survey ln whlch Lhelr
employees answer some quesLlons abouL Lhelr level of saLlsfacLlon wlLhln Lhe company
(wwwunllevercom)

1hls doesn'L only glve a perspecLlve on how Lhe employees are feellng abouL worklng
ln Lhe company (83 of employees felL proud Lo work for unllever") buL also prevenLs labour
Lurnover by lmprovlng Lhe aspecLs LhaL Lhe employees refer ln Lhelr answers 8esulLs also
showed LhaL 78 of managers feel LhaL unllever's leadershlp has communlcaLed a moLlvaLlng
vlslon for Lhe fuLure and 83 of employees felL proud Lo work for unllever 1he survey
conflrmed Lhe areas for furLher lmprovemenL such as Lhe need for fasLer declslonmaklng
addresslng poor performance and regular feedback from manager" (wwwunllevercom)

6

efe^encex

8eardwell l Polden L Claydon 1 (2004) nomoo kesootce Moooqemeot (4
Lh
edlLlon)
bttp//wwwoollevetcom/sostolooblllty/employees/Jeveloploq/loJexospx
(wwwoollevetcom)
bttp//wwwoollevetcom/lmoqes/lt_oooool_tepott_2010_tcm1J260J79pJf
(wwwoollevetcom)
bttp//wwwoollevetcom/sostolooblllty/employees/well
beloq/sofety/?w1lnNAv5ofety_lo_tbe_wotkploce
(wwwoollevetcom)
bttp//wwwottlclesbosecom/bomootesootcesottlcles/toleoftbeloboottotoovet
1889105btml#lxzz1Jlpl2wlb
(wwwottlclesbosecom)
8ecrulLmenL 8eLenLlon and 1urnover 2009 Clu
(wwwclpJcook)
Lepak u Snell S (1999) 1be sttoteqlc moooqemeot of bomoo copltol Jetetmlooots ooJ
lmpllcotloos of Jlffeteot telotloosblps