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Human Resource Management in the Service Sector: Ryanair

Free «Human Resource Management in the Service Sector: Ryanair» Essay Sample

Introduction

Human resource planning is a continuous process of planning to attain maximum use of the firm’s most valuable resource – human resource. The main objective of human resource planning is to ensure that the workforce corresponds to the specific jobs, making sure that there are no shortages or surpluses (Baum, 2006). Human resource management can also be termed as the specific functional role performed by specialist personnel. There is no doubt that human resource planning and effective workforce utilization are the central elements that have given Ryanair competitive advantage in the air transport industry (Baum 2012). At the moment, Ryanair carries more than 76 million passengers on modern aircrafts (Boeing 737-800s) (Ryanair, 2015). Such impressive results are a consequence of the HRM, efficient operations and execution of a cost-based business strategy. Current report will be subdivided into four main parts, which will include the human resource activities at Ryanair, the HR plan for Ryanair, the history of employment relations in the United Kingdom and evaluating the current affairs of employment relations in Ryanair, as well as their relation to the human resources policies at the company.

Task 1

Role of Human Resource Management in Ryanair

The primary role of HR at Ryanair is to ensure the right number of labor force possessing the required skills is available (Ryanair, 2015). When organizations plan for the future, they make a business plan to assist them in attaining their short and long-term objectives (Baum, 2006). The workforce is an important resource, and having the right number of employees with appropriate skills is essential for the company to perform effectively and function productively. Therefore, it is important for the HRM to understand the adjustments that are necessary and improvements needed to achieve the strategic goal and business objectives. It may encompass making the decision to increase or reduce the number of workforces, or decisions regarding redeployment to critical areas to add value that is needed to operate successfully (Baum, 2012).

Human resource planning is a continuous process of planning to attain maximum use of the firm’s most valuable resource – human resource. The main objective of human resource planning is to ensure that the workforce corresponds to the specific jobs, making sure that there are no shortages or surpluses (Nickson, 2007). There are three fundamental factors of the human resource planning process, including analyzing the current supply of labor, forecasting the demand for labor, and balancing the labor supply and demand. Human resource planning has played and continues playing an important role in the success of Ryanair either indirectly or directly (Baum, 2012). HRM is concerned with implementing policies, planning, and striving to make decisions for the benefit of the workforce within the organization and the company (Carbery & Cross, 2013). In this regards, HR manager may need particular personal information, such as position details, personal records, and workforce satisfaction. Such issues form the main elements of the planning process for the HRM at Ryanair.

Forecasting Labor Demand and Supply

Forecasting as an element of HMR entails knowing and matching the apt applicant with future job opportunity. The HR employs the appropriate forecasting strategies to establish the number of employees, the skills that they should possess and their ability to fill different posts in the future (Baum 2006). There are numerous strategies that HRM can employ to forecast and find the apt applicant for the job opportunities in a company (Baum 2012). They include:

  • Computerized forecast;
  • Managerial judgment;
  • Ratio analysis;
  • Delphi technique;
  • Trend analysis;
  • Work study technique.

In regards to Ryanair, the HRM has been using a combination of Delphi technique and the managerial judgment technique to identify the right candidate for different job opportunities in the company.

Developing HR Plan at Ryanair

  • Business dynamics;
  • Building a sustainable HR for Ryanair entails focusing and developing the organization’s long-term strategy;
  • Evaluating the HR requirements at Ryanair.

It is evident that the airline industry is one of the most competitive industries in Europe. It is an industry that is driven by high technology, the safety of passenger and sensitivity to prevailing external factors that shape organization operations. In such environment and industry, the workforce must be vigilant (Crawley, et al. 2011). The safety of passengers is the top priority in all circumstances and the human resource team at the Ryanair has to make sure that they have a professional personnel in the right positions to help the organization reach its main goals (Baum, 2012).

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The HR department is an integral component of every successful company. The HRM adapts different changes taking place in the external environment and initiates activities and plans that shall make it possible for the organization to remain in line with the present changes and ensure the welfare of the workforce (Baum, 2012). The HRM planning process at Ryanair entails forecasting the requirement and initiating strategies to make sure the apt number of workers and right individuals are available at the place any time. Ryanair can achieve immense success by implementing the following planning methods:

Delphi Judgment

Current technique was developed by Dalkey and Helmer (1963) and is a commonly used as a way of attaining convergence of opinion relating to knowledge gathered from skilled experts on particular subject matters (Crawley, et al. 2011). The strategy has been employed by the HRM at Ryanair with momentous results. Current method requires from the human resource manager to gather the opinion of experts on the labor force. The HR collects the projections and forecasts of various experts -who serve as intermediaries- and summarize the different responses received into findings (Baum, 2012). The experts on labor laws are then given the final reports and can make the appropriate adjustments depending on the prevailing conditions. Even though the Delphi technique consumes much time due to the long process of gathering opinion, Ryanair has been using the technique extremely well.

Managerial Judgment

Using such method, the managers from different departments of the organization gather and establish the nature and volume of work in the future, and identify the number of labor force required, and the type of skills they possess. Ryanair uses current method in two distinct ways: in the top-down approach and bottom-up approach (Baum, 2012). In the top-down approach, the senior managers prepare the projection for the number of workforce required for each unit and then analyze and discuss their forecast with the heads of various departments and their subordinates to establish whether any adjustment is needed in the forecast made by the managers. In the bottom-up approach, the top managers request the supervisors of the various units and heads of different department to consider the projection, make necessary amendments and pass the forecast to the top managers for deliberation (Crawley, et al., 2011).

It is important to note that the approach used to develop the HR plan will differ from one company to another, but for Ryanair the HR plan can be divided into the following parts:

  • Lay down the strategic direction;
  • Formulating the HRM system;
  • Planning the entire labor force;
  • Spawning the needed personnel;
  • Investing in HRD and in performance;
  • Evaluating and maintaining company performance and competence.

Task 2

The History of Employment Relations in the UK

In the UK, developments in the political scene have led to a number of legislations that have sought to streamline the aviation industry and make contractual arrangements between employer and employee more enforceable and binding (Lucio, 2010). Deregulation of the aviation market, reduction of corporate taxes and union recognition have had momentous effects on the HR operation at Ryanair (Gilmore & Williams, 2012). In the Irish framework, centralized wage agreement negotiated by the government from 1970s led to a long duration of stability. The legal framework covers broad areas that impact the working environment in the aviation sector. The parts covered include the requirement for firms to allow the workforce to leave entitlements, grounds of dismal, issues associated with the safety of work and terms and conditions of employment (Gilmore & Williams, 2012).

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The UK airline industry has undergone massive changes in the last three decades, essentially as a result of the liberalization and the surface of low-cost airlines (Baum, 2012). The changes have had significant effects on the employment and industrial relations in the aviation industry (Broughton, 2005). ‘Employment Relations’ is a term that denotes the relationship between the airline, which serves as employer and the employee, who serves in different capacities (Gilmore & Williams, 2012). The laws and regulations established by the UK government have a significant impact on the relations between employer and employees in the aviation sector. It refers to the regulations that exist in guiding the membership of trade unions (Sheehan, 2014).

Employees in the aviation industry have found it increasingly important to organize and represent their concerns to their employer and the society in general through a process of collective bargaining (Lucio, 2010). Unlike in the 1960s and 1980s when there was a substantial rise in employment relations, today the trade unions experience general decline in their operation (Gilmore & Williams, 2012). In addition, the focus of unions has changed over the years from bargaining for better-working conditions and reasonable pay to supporting the grievances and complaints of members (Roinn, 2015).

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Assessment of the Law and its Impacts on HR in Ryanair

The HR at Ryanair has laws responsibility to follow, for example, the Equal Opportunity Commission. Over the years, such Commission has initiated various Acts that must be followed by players in the service sectors, including the aviation industry. They include Age Discrimination in Employment Act, Civil rights of 1964 and the Rehabilitation Act of 1973 (Broughton, 2005). Such regulations have been established to eliminate discrimination of any kind in the employment process. Ryanair has been scrutinized on several occasions by both domestic authority and International Unions. The liberalization of the market in the 1980s enabled Ryanair to set new prices which created more possibilities for competition and profit. It has impacted the level of remuneration for the cabin crew. The airline is also subjected to broad regulatory and legal observance that has increased operation costs significantly. For example, the adherence to the directive issued by the FAA for the training of pilots has increased training expenses for the airline.

The way in which Ryanair manages its employment relations is in line with the low-cost model it pursues. Due to it, the majority of its activities are contracted to the third party specialists, who assist in delivering efficiency savings (Gilmore & Williams, 2012). The workforce, especially the cabin crews are employed in short-term contractual arrangement through a third party (agencies). The staff has to pay for their training. As a result, it is clear that minimal involvement in the decision-making process for its low-cost approach is the main element that influences the employment relations (Baum, 2012). Ryanair does not allow its employee to join trade unions, since the company strives to create competitive advantage through cost reducing measures, and trade unions would compromise their stance regarding such aspect (Gilmore & Williams 2012).

Task 3

Recruitment Policies and Process in Ryanair

Eoin, et al. (2004) define recruitment as the process through which firms determine, develop, search, and catch the attention of individuals to fill various job vacancies. Workforce recruitment encompasses interview, screening process, and selection of the most suitable individuals for a given job vacancy. Additionally it includes transfer, demotion and promotion, filling posts and coordination of temporary employment. The main goal and objective of Ryanair in relation to recruitment is to identify and employ the most suitable candidates in a cost-effective way (Ryanair, 2015). In the United Kingdom where regulations and laws are enforced to the state, especially in the air travel industry, the recruitment must also be done in a legal manner.

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Recruitment process at Ryanair basically involves planning, screening, and selection process (Ryanair, 2015). The human resource department at Ryanair must, therefore, make sure that the recruitment process is directly correlated and integrated with the firms strategic planning and direction. Eoin, et al. (2004), indicates that for the process of recruitment to meet organization goals and be effective, it must be consistent with the vision and strategy of the organization, the organization culture and the values that guide business operations. Strategic deliberations are centered on the labor requirement of the organization. At Ryanair, once the HRM defines the needs of the company, the specific requirements of every unit and departments are defined in order to identify the appropriate candidates for different posts. At Ryanair the objectives of the organization’s recruitment process are:

  • Assist job applicants to communicate with the company on the available job opportunities;
  • Ensure adequate supply of skilled and talented human resources;
  • Attract sufficient pool of candidates from the workforce;
  • Attract and persuade job seekers to apply in the company;
  • Assist the company to establish the future workforce requirements;
  • Training and development of its employees.

Ryanair is concerned about brining individuals together and flying them to wherever they want to travel. Such aspect applies, to a certain degree, to the employees who make sure that the millions of people who want to use the company’s services are satisfied. In this respect, it is clear that Ryanair can only attain full potential if it can attain the broader business objective (Ryanair, 2015). Consequently, the company conducts a formal appraisal and promotion programs with manifold processes and panels for them. Ryanair rewards its workforce for their efforts and provides incentives to encourage them to be the best in the industry. The company also provides competitive salaries to its human resources with exceptional benefits (Ryanair, 2015). For example, the company offers share option scheme, which enables employees to own a part of the firm and, in such way, share the company’s success. The key human resource policies at the company include:

  1. A huge proportion of the workforce is recruited by external agencies in order to reduce the total company cost of human resources. The majority of employees are also on the payroll of such agencies;
  2. Training process and development programs are also carried out by the external agencies and are usually covered by the employees;
  3. Reward is based on the hours that a given employee spends in the flight and is not based on a fixed daily working scheme. It is a policy that relates to pilots and other members of flying crew (Ryanair, 2015).

How the Company Recruits

Applications for different job opening in Ryanair are completed online, from where they are screened by an external agency (third party). The agency is the one responsible for selecting and recommending the candidates to the department of the human resource at Ryanair (Flying Time Aviation, 2015). Once the HRM receives the names of the selected candidates, interviews are conducted and during the process each candidate receives a pack that includes:

  • Profile to be employed;
  • Simulator tool outline;
  • Pre-Flights setups.

The interview process at Ryanair is subdivided into various segments as follows:

 

Technical:

Situational awareness, CRM skills, IFR course of actions, aircraft handling, instrument scan, team work, error and threat management, candidate level preparation (Flyying Time Aviation 2015, P 1).
 

Personal attributes:

Learning rate, ATO report, maturity, English language skills, intelligence, learning rate, self-confidence and leadership skills.
 

Simulator assessment:

Introduction, simulator brief (flying), instrument layout, center layout, Jepp plates, Navaid plates, brief profile.
                   Simulator Profile: Normal takeoff, precision approach, general handling, and  non-precision.

Ryanair rating includes:

  • One-month ground training;
  • At least 60 hours of simulator sorties;
  • 6-8 weeks of line training;
  • One-day base training;
  • One week of observing standard operating processes.

For the HR department to attain such goals, the manager employs both external and internal recruitments. Internal recruitment encompasses the current workforce to fill job position where they will show the best results, while external recruitment includes recruiting from the outside of the company (Ryanair, 2015).

In this regards, the HRM uses numerous tools and techniques to hire the right candidate for every post. In most cases, the company prefers external recruitment, but as it is much more costly for the firm, it opts to use a third party in initial stages and becomes involved in the process only after the selection procedure. It is important to note that the strategy of Ryanair is based on being a low-cost airline and it explains the HRM decision to use external agencies in the recruitment process (Ryanair, 2015).

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Task 4

Training and Development

Training and development, such as productivity enhancement, orientation, performance management skills training and other planned learning experiences teach the workforce how to operate and performs the current and future jobs effectively. While training focuses on the current jobs at the company, development is a process meant to prepare the workforce for probable future jobs.

Employee Development Policy at Ryanair

Ryanair uses strict policy in the process of training and developing its employees. In line with the precepts of such policy Ryanair does not have to invest resources to train and develop its workforce; instead it creates a platform from where the current workforce can self-fund their training. To attain such objective, Ryanair has collaborated with Crewlink Crew Training and Recruitment to offer cabin crew tutor individual looking for a job opportunity at the company (Ryanair, 2015). Crewlink provides training services to candidates for a given fee and the partners with Ryanair for recruitment and selection of candidates who complete the approved training program. The training and development policies at the company are an integral part of the operation strategy for reducing costs. Ryanair has a high employee turnover and at the moment it is recruiting new workforce by labor contract via recruitment companies (Ryanair, 2015).

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