Human Resource Strategy of Ramalingam Foods for international expansion

Assignment Taken

Propose a strategy for hiring and providing incentives for employees for international expansion and sustainable growth of the company.

Case Understanding

Mr. Ramalingam Venkatesh established Ramalingam Foods in 1965, which stands for an authentic taste of South Indian food and filter coffee. They started off by selling Dosa – Idli batter and Chutney packets at low cost, still maintaining a good margin. As the shelf life of these products were very low, they came up with the idea of selling powder form of Idli Dosa batter, which became an instant hit as people found it very convenient to carry it with them. People even started purchasing it in large quantities and reselling it abroad. Hence, the company wants to expand to foreign markets not to lose their profit. We as the consultant company for International Business will be suggesting to expand to Middle East (Namely Saudi Arabia, UAE and Oman) and instead of targeting tier 1 cities which are scattered around, we will be establishing in a region as a cluster and expanding from there so that cost will be less and brand image would spread easily from word of mouth. HUMAN RESOURCE CHALLENGES THAT THE COMPANY WOULD FACE 1) Employees need to be hired in a mix pattern – major chunk of them would be locals who are familiar with the culture, language etc. of the target country and a few employees from South India who would be familiar with the taste and composition of the products to look after their quality and composition. 2) Hiring local manpower will be challenging as the salary structure and incentive structure followed in each country would be different. Even the holiday in a week would be different so even the hiring of South Indian employees should be done keeping in mind all those factors. 3) Employees should be well aware of the products they sell, especially as there would be two different line of products catering to the Indian and Non- Indian diaspora. 4) Should be aware of the laws and practices for hiring and employing personnel according to the country’s rules and regulations including legal implications.

BCS Solution Summary

1) The number of employees to be hired locally must be maximum to ensure smooth functioning as they are familiar with the culture and taste of the particular region. The employees should be given proper training to work in coordination with each other for the success of the company. A family culture should be developed at work. The employees must be familiar with the history and establishment of the company, its roots and how the company rose to its current status. The heritage and status should be maintained. 2) Identify and collaborate with a local manpower consultancy firm to hire people from local areas. People who have some experience in the field of food industry and Indian origin who has lived in that particular country for a long period of time could be given preference. The salary and incentive structure should be according to the country’s rules and regulations. 3) All the employees must be well aware of the ingredients and the products well enough to explain to their customers and respond to their queries. They should be given adequate training for the same. Especially as there will be two line of products with different composition employees must be aware of the products really well. 4) The management should function in coordination with the HR department, IT department and the Government of the country with respect to the legal hurdles for establishing the business in a foreign country and hiring people for employment, as major portion of the employees will be locals.

Solution

Henry Fayol’s Management Principles used to derive the solutions

 

A) Unity of Direction – According to this principle whoever is engaged in the same activity should have a unified goal. All employees working in an organization should have one motive and goal. All the employees of Ramalingam Foods must have a unified goal which is the success of the company, irrespective of their cultural differences and tastes.

 

B) Remuneration – This management principle talks about remuneration playing a very important role in the motivation of the employees, whether monetary or non – monetary. Ramalaingam foods must keep this in mind, while designing the pay structure of employees according to the country’s practices.

 

C) Division of work – According to this principle, the work should be segregated among the workforce to enhance the quality of the product. It also improves productivity, efficiency, accuracy and speed of workers. Ramalingam foods should give appropriate training to two division of employees separately who will be handling two different line of products meant for two different population. There should be proper coordination between all the departments of the company too.

 

D) Authority and Responsibility – This principle talks about the two main aspects of management, authority which leads to efficiency and responsibility for the work. The management should consider all the legal aspects of establishing a company in a foreign country and should work in coordination with the corresponding authority of the country.

 

Hiring and Incentive strategy of Ramalingam Foods for Human resources working on international expansion to Saudi Arabia, UAE and Oman:

 

A) Hiring strategy of Ramalingam Foods:

Ramalingam Foods should implement the following strategies while setting up and expanding its business in Saudi Arabia, UAE and Oman.

   HIRING STARATEGIES                                           IMPLEMENTATION

Identify the right hiring consultancy firm to find the right employees	Hiring the right man power is critical for the success of any company. Since the company is being established in a foreign country, there would be language and cultural differences. So identifying the right manpower recruiting firm would be the first step in the right direction. Employees should be able to communicate well with the customers and should be culturally sensitive.
Find the right candidates	Employees both from local and Indian location should be done judiciously, as there are many differences in the employment structure in a foreign country. People with prior work experience in the food industry could be given preference. Even though their educational qualification does not matter that much for the ground job, they must be able to read and write and should be able to identify the ingredients and products. So a minimum educational qualification must be identified and the salary structure, incentives and holidays, leaves etc. must be clearly communicated.
Employees should be sensitized to cultural differences	As employees have to work in the coordination with different departments and people from different cultures and countries, a family sense should be established for the success of the company. The story and history of the company should be communicated to develop a sense of belongingness and the provision for employees to interact with each other should be provided during breaks.
Legal implications	The company should take care of the legal requirements of establishing a company overseas. The rules and regulations must be considered for hiring, retaining and providing incentives to employees. The number of leaves, holidays, medical leaves etc. should be fixed according to the country’s rules and regulations.

 

Projected Number of employees to be hired across different departments in all the three countries (Saudi Arabia, UAE, Oman) for the upcoming financial year 2021-2022:                                   

                                                                                                                                                                                                                                             

   DEPARTMENTS                            COUNTRIES               TOTAL NO OF EMPLOYEES

FINANCE	Saudi Arabia, UAE and Oman	3(1 Per country)
MARKETING	Saudi Arabia, UAE and Oman	3(1Per country)
HR	Saudi Arabia, UAE and Oman	3(1Per country)
IT	Saudi Arabia, UAE and Oman	3(1Per country)
OTHERS	Saudi Arabia, UAE and Oman	3(1Per country)
CORPORATE HEAD(TO OVERSEE THE OPERATIONS OF ALL THE THREE COUNTRIES)	Saudi Arabia, UAE and Oman	1

 

B) Incentive strategy of Ramalingam Foods:

According to principles of management incentives can be both monetary and non-monetary to motivate the employees

1. A rating based incentive system for the employees, to reward the employees who provide good customer service.
2. Employees should undergo proper training requirement and can be incentivized based on their absence from the job.

Monetary Incentives in Ramalingam Foods  may include- 

1. Bonuses for good ratings for customer services 2. Sales and promotion incentives

Non-Monetary Incentives in Ramalingam Foods   may include- 

1. Awards for achieving sales target 2. Coupons or discounts in collaboration with other 3. Gift vouchers

 

Projected Cost to  implement  Hiring and Incentive Strategies across departments in all the three countries( Saudi Arabia, UAE and Oman) for the upcoming  financial year 2021-2022:

                                       Q1                 Q2                       Q3                  Q4                         TOTAL

FINANCE	2	2	3	3	10
MARKETING	3	2	2	1	8
HR	2	2	3	3	10
IT	2	2	2	2	8
OTHERS	2	2	3	3	10

*Figures (In above table) are given in Rs(in lakhs)  

Conclusion

Conclusion Ramalingam Foods will fare well if they implement these hiring strategies. All legal requirements should be taken into consideration while hiring people.

Attached File Details

Video

https://youtu.be/EEdsR8gXAxs