Case of enterprise management failure

Shengli Company is a famous private iron and steel enterprise in China. Under the favorable environment of the vigorous development of China's iron and steel industry, it has developed from a small iron works to a medium-sized iron and steel enterprise with high reputation in the industry in just a few years, which has promoted the development of a series of related industries such as local coking, steel rolling, building materials, minerals and services, and solved the employment and re-employment problems of more than 4,000 local employees. It has made outstanding contributions to local social stability and economic development, and the management of the company is also full of ambitions, hoping to seize the good development opportunity of the steel industry and strive to be the leader of private steel enterprises in China.

Recently, however, several key employee job-hopping incidents occurred in Shengli Company, which made the company's management fidgety. As the steel market situation continues to be bullish, the wave of steel investment is getting higher and higher. On the one hand, new steel mills have mushroomed, on the other hand, the original steel enterprises have expanded. In order to reach production as soon as possible, these new steel enterprises have adopted the way of digging corners to obtain the talents they need. For a time, the supply of technicians and skilled workers in the steel industry was in short supply, and the value was rising. Many technicians and skilled workers can't resist the temptation of external high salaries and have jumped ship. Shengli Company is no exception, with more than a dozen key employees leaving in the first quarter alone. At first, the management was relatively calm, and felt that a company with thousands of people, with more than a dozen people, was normal and would not have any great impact on the normal operation and production of the company. However, the job-hopping storm has intensified. Two days ago, two excellent steelworkers in the company's steelmaking plant were poached by competitors, and more seriously, some workers were taken away one after another.

The management was extremely annoyed after learning about this incident and ordered the human resources department to take measures as soon as possible to change the current passive situation. After some investigation and study, the human resources department of the company submitted a report to the company leaders, asking the company to expel all family members and relatives who have resigned but still work in the company to prevent the spread of the situation. The management of the company quickly approved the report of the human resources department. Within a week, dozens of employees were unilaterally fired by the company because they had relatives or friends with job-hopping employees.

However, things are not as simple as management thought. Later, a series of chain reactions surprised the management: the dismissed employees pleaded for their grievances, protested in succession, and complained to the local labor department to protect their rights ... After on-site investigation, the local labor department determined that such a "policy of killing the company" was a serious infringement. Ordered Shengli Company to restore the labor relations of these employees as soon as possible ... The local media also supported these innocent laid-off workers and condemned Shengli Company in succession ... On the one hand, the employees in the company felt that the company's policy of killing the company was inhuman, and at the same time, they were worried that they would be implicated ... The company managers also expressed their opinions that the policy of killing the company was inhuman and unfair to those "family members and relatives" who were fired. ...

The "job-hopping storm" of Shengli Company quickly rose to a major crisis for the company. In desperation, the management had to cancel the announced policy of "killing the company", restore the labor relations of those dismissed employees, and make great efforts to do the work of the labor authorities and the media to resolve the crisis. However, the negative impact of "killing the company" is hard to eliminate, and employee relations become very fragile. ...

Vigilance: Neglected Employee Relationship Management

With the development of market economy, private enterprises in China have gradually grown. Over the past 20 years of reform and opening up, China's economic structure has undergone earth-shaking changes, one of the most obvious features is the rapid rise of private enterprises. According to statistics, since 1980, the output value of China's private economy has increased by 7 1% every year, and the employment of private enterprises has increased by 4 1% every year, and the contribution of private enterprises to gdp has exceeded 50%. The main advantages of private enterprises are still reflected in the mechanism, but the management situation is worrying. With the expansion of the company's business volume and the increase of the company's personnel, various management problems of the enterprise also appear. The weak management consciousness of entrepreneurs and the resistance of family members to standardized management all hinder the improvement of the enterprise's management level, which immediately leads to coping with the crisis, either stagnating, on the verge of bankruptcy or filing for bankruptcy. According to statistics, the average life span of small private enterprises in China is only three years, while that of large and medium private enterprises is seven years.

There are many reasons why China's private enterprises can't achieve long-term sustainable development, but too much ambition and insufficient attention to infrastructure construction are the stubborn diseases of many private enterprises, and employee relations have also become the management blind spot of many private enterprises. When private enterprises set up modern enterprise management mechanism on the basis of referring to the western property right system, they also copy the western management mode to manage employees in China, which greatly simplifies the employee relationship, thinking that enterprises and employees are just a kind of money employment relationship with their own advantages, thinking that employees get the money they should get, and that others don't have to worry about it. Moreover, the organizational structure of private enterprises is usually simpler than that of state-owned enterprises and foreign enterprises, lacking some specialized institutions to coordinate and maintain employee relations. Most enterprises have no trade unions, and the establishment of trade unions often exists in name only.

Due to the above reasons, many private enterprises are facing a tense employee relationship, which is slightly manifested as weak sense of responsibility, insufficient enthusiasm, low production efficiency, serious contradiction between employees and management, and even a major management crisis. There is a survey on employee turnover abroad, which lasted for three years. The results show that the reasons for employees leaving their jobs have little to do with money, but discord with middle-level leaders has become the first reason for them to leave their jobs, including poor speaking skills of managers and other factors. The second main reason for staff turnover is that they do a good job and no one praises or pays attention to it. These two reasons actually belong to the category of employee relationship management, but similar problems have not been paid attention to by domestic private enterprises.

Perspective: the misunderstanding of employee relationship management in private enterprises

In the long-term management consulting process, the author found that many private enterprises in China have some obvious misunderstandings in the process of dealing with employee relations due to the lack of systematic understanding of employee relations management.

Myth (1): Employees' resignation is a betrayal of the company.

In the market-oriented environment of modern labor and employment, enterprises can choose suitable employees according to actual needs, and employees can also choose suitable companies according to their own professional expertise and preferences, thus realizing the optimization of human resources in the whole society, so employee turnover is a normal behavior. However, many managers of private enterprises lack a correct understanding of this and think that employees' resignation is a betrayal of the company. No matter what the reason, they rarely reflect on the problems existing in the enterprise itself. In their view, it is reasonable for enterprises to dismiss employees, but if employees want to leave their jobs within the contract period, they will certainly be misunderstood and rejected by managers, and even lead to corresponding disputes.

Myth (2): Employee relationship management is to prevent employee turnover.

Under the modern human resource management system, the connotation of "employee relationship management" is very rich, including the matching of personnel and positions, employee development, employee motivation and effective communication. However, "employee relationship management" is still a strange word in the eyes of many private enterprise managers, which is far less valued than "work plan" and "performance appraisal", and is even extremely understood as employee relationship management to prevent employee turnover. When the enterprise develops well and the workforce is relatively stable, there is no thought of doing any employee relationship management work at all. When it is found that subordinate employees have accumulated more grievances or even left their jobs, they will remember that they have not paid attention to employee relationship management at ordinary times.