Strategic Human Resources Strategy at Hansson Industries

STRATEGIC HUMAN RESOURCES STRATEGY AT HANSSON INDUSTRIES

ABSTRACT

As a member of the HRM consulting team which has been contracted to review the HRM policies of Hansson Industries, you have been presented with the following analysis based on your project team's observations over the last several weeks. The analysis presents a strategic human resources analysis of two Hansson Industries Engineering, Research, and Development offices in Seattle, Washington, and Stockholm Sweden. As is common in the chemical and paper industries, the two units are currently managed via the portfolio management method, with very little value added by way of group synergy, with the exception of technology transfer. However, the opportunity exists to transform Hansson Industries into a growing, dynamic, and global company with a highly talented international staff. As an new member of a highly respected HRM consulting company, you must devise a strategic Human Resources plan to facilitate that transition.

HANSSON INDUSTRIES USA, BACKGROUND

Hansson USA is a consulting engineering and technology licensing group composed of approximately 70 employees located in Seattle, Washington. Hansson's primary customers are pulp mills located in the United States, Canada, New Zealand, and Australia. Customers of Hansson Include Weyerhaeuser, International Paper, Washington Pacific, and many other major pulp and paper companies. Hansson's cash cow is called the MVP (or multi-vessel process), which is a process that manufactures a dilute chlorine dioxide solution that the pulp mills use in the pulp bleaching process. Since demand for the MVP results from environmental concerns, demand has been steady and Hansson has not been forced to release employees during economic down turns. Since Hansson is one of only two companies in the world to sell the MVP, the level of customer orientation is low, there is no formal marketing department, and the business is driven by technology. Hansson receives license fees for each ton of chlorine dioxide produced during the first ten years of operation of a new plant.

The office in Seattle is divided into several departments: process development, process engineering, project engineering, technical service, and sales. Note that there is no human resources or personnel manager and that all recruiting is done primarily by word of mouth or through employment agencies. Although the office in Seattle was at one time only a contract engineering office with no process development department, the focus of the organization has now shifted to applied research and development, where the "stars" of the company work. However, since the cash is made through project sales, the process, project, sales and technical service departments are also very important. A project team, consisting of one sales engineer, one process engineer, and one project engineer is assigned to each new project. All three engineers attend the initial sales meetings, and after the project is sold, the process engineer designs the plant, the project engineer orders all of the necessary equipment for construction, and the sales engineer acts as a customer service representative. After the MVP has been constructed and is ready for commissioning, a team of process and technical service engineers will go to the customer's site to start the plant and train the plant operators.

HANSSON USA, ATMOSPHERE & MANAGEMENT STYLE

Hansson USA is a technologically driven company managed by engineers, with most direction and decision making coming from the top. Despite the fact that Hansson has been successful at hiring highly talented engineers, the work atmosphere is one of stagnation and lack of motivation, with the thinkers (i.e., top management), clearly separated from the doers (i.e., the engineers). One exception in this case is the process development department, where the development engineers are given some autonomy in their technical decision making. Using the five management styles defined by L.J. Bourgeois in his article "Putting Your Strategy Into Action" ,management at Hansson USA clearly follows the Commander Approach, where "The CEO concentrates of formulating the strategy, giving little thought to how the plan will be carried out. He either develops the strategy himself or supervises a team of planners. Once he's satisfied that he has the "best" strategy, he passes it along to those who are instructed to "make it happen""[1].

HANSSON USA, EMPLOYEE BENEFITS AND CAREER DEVELOPMENT

Although Hansson will reimburse employees for most continuing education expenses, career development efforts are kept at a minimum level, with no human resources personnel and no long term career planning for individual employees. There is currently an annual bonus system in place, but the basis of the reward is dependent on the personal opinion of the vice president which is obviously highly subjective, so the system does not provide any additional motivation for employees. Although many engineers have come from Sweden to Seattle to work, only one American engineer has been sent to Hansson Sweden. This decision was forced onto the top management at Hansson USA, who either felt threatened by the exchange or thought that the exchange was of little use.

HANSSON INDUSTRIES SWEDEN, BACKGROUND

Hansson Sweden is also a consulting engineering and technology licensing group composed of approximately 60 employees located in Stockholm, Sweden. The sister company's customers are pulp mills located in all parts of the world not covered by Hansson USA, including Europe, Asia, South America, and Africa. Customers of Hansson Sweden include all major pulp and paper companies in these locations. Hansson Sweden's cash cow is also the MVP, which is in demand for environmental reasons world-wide. Hansson Sweden also builds several types of plants that Hansson USA does not, including chlor-alkali, SO2, and sodium chlorate plants. However, since Hansson Sweden has chosen to keep all detail engineering personnel in house, they have been subject to cyclical swings in demand caused by changes in the state of the world economy. During economic hard times, Hansson has been forced to lay off all consultants, a once unheard of practice in Sweden. Although Hansson Sweden is one of only two companies in the world to sell the MVP, unlike Hansson USA, management has chosen to focus on building long standing relationships with their customers. As in the U.S., there is no formal marketing department, and the business is driven by technology.