Inter Clean Benchmarking
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Inter-Clean Benchmarking
Abstract
InterClean, Inc. is a major player in the cleaning and sanitation industry. After a recent merger with a top competitor, EnvironTech, the company must undergo an intensive change management transition. Through research analysis of three other companies, the following is a summarization of solutions InterClean Human Resources may consider during this ordeal.
InterClean Benchmarking
In todays global and technological market environment, change is constant. As a result, businesses around the world are finding ways to sustain competitive advantage. Instead of just focusing on financial, strategic, and technological capabilities, emphasis shifts now to a companys ability to effectively manage people through “organizational capabilities,” which relates to hiring and retaining competent employees and developing those competencies through effective human resource practices. (Dreher & Dougherty, 2001) More and more organizations and senior executives are saying human-capital management is critical and Human Resources should play a major role in improving it. (Lawler, 2005)
In the current problem scenario we are analyzing, InterClean, Incorporated, a major player in the cleaning and sanitation industry, will undergo an intensive change management transition. InterCleans Human Resources is assigned to plan strategic organizational changes necessary to accommodate the development of full-service solutions packages within three to six months. As InterClean aligns organizational change around the new solutions- based vision, sales and marketing will experience a change management transition, especially after the acquisition of a domestic competitor, EnviroTech. This task will not be easy for HR since “the management of organizational change is a challenge on that we must study continually if we are to identify the skills sets we need to cope with it at todays ever-accelerating pace” (Reilly, 2007, 16).
When a company such as InterClean faces dilemmas with organizational change, change management, acquisitions of other companies, limited expenses, need to expand operations, and handling different stakeholders; human resources management needs to think outside the box. A common practice is to benchmark to find best solutions to handle these transactions. InterClean can learn from other companys best practices and situations experienced from outside the cleaning and sanitaation industry. Companies such as Hewlett-Packard, Pfizer, and Del Monte Foods also faced similar dilemmas during acquisitions. With the proper research from these companies, several ideas were obtained.
First we begin looking at a major technology company, Hewlett-Packard (HP), who operates in more than 170 countries. The company has successfully expanded to be a technology solutions provider to consumers, businesses and institutions globally. In early September 2001, HP acquires Compaq, a major competitor, in a $25 billion deal and became “one of the largest technology companies in the world” (Williams & Legard, PC World, 2001). Obviously, this acquisition is not at the same scale as InterCleans but it provides best procedures as to how two large companies with combined staff of “around 145,000 people in 160 countries after the merger” were able to retain key talent. Human Resources played a large role with the HP-Compaq.
Another company examined during our benchmarking research is Pfizer, a research-based, global pharmaceutical company. This company, headquartered in New York City, employs about 115,000 people worldwide. At present, Pfizer manufactures five of the worlds top selling medicines, including Lipitor, the worlds best selling drug.
In August, 2006, Pfizer Chairman and CEO, Jeffrey Kindler, announced the new organizational structure of the company that will address the rapid changes taking place in the healthcare environment. According to Kindler, “we need to align our organization to todays markets, so that we see opportunities quickly and act on them, whether that means increasing support for successful new medicines, forging partnerships with key customers, entering into co-promotion and licensing agreements, investing in new technologies to add value to our core product offering, or acquiring new products and services from outside the company.”
Last year, Pfizer recorded revenue of $45.1 billion, a 2 percent increase compared to 2005. The pharmaceutical industry is changing rapidly. Science is creating wholly new ways to treat disease, regulators and payers are more demanding, and patients are becoming more involved in their healthcare decisions.
The third company analyzed is Del Monte Foods, the world famous canning company whose products are found in 9 out of 10 American households. With brand names including Del Monte, Contadina, StarKist, S & W, 9Lives, Kibbles and Bits, the companys reputation in business is synonymous with the words “highest quality.” Presently, at peak employment, Del Monte has 17,600 employees. Almost 8,000 are full-time personnel, while 9,800 are seasonal workers. The company operates 17 production facilities and 18 strategically located distribution centers in North America. Additionally, Del Monte has operating facilities in American Samoa and South America. Annual sales of the company showed over $3 billion last year.
Each of the companies identified must deal with staff streamlining as a result of company acquisitions. An example of HPs challenge was to eliminate duplicate positions held at various company offices including headquarters, distribution, and resellers. HR began reorganizing the necessary talent to pursue a more prominent future, yet all their employees in duplicated positions had to apply for their jobs again. As one of HP regional director mentioned in early 2004, “this will have to be done in a fair and equitable way, which will take a long time” (Williams & Legard). HR management looked at the human capital of both companies and built the skills required in the end-state environment. Moreover, HR management and development built competencies to create a well defined vision.
Pfizer is facing elimination of about 10 percent of the worldwide workforce within the next year by reducing middle management, closing almost half of the manufacturing sites around the world, as well as abolishment of research sites in the US, Japan, and Europe. The company is working closely with job councils and consulting local labor unions and offering support and benefits to employees affected by the changes. While the surrounding communities and medical staff play roles