Case study 10 organization and role of HR THE ROLE OF HR AT INTERNATIONAL AID

Case Study 10. Organization and Role of HR THE ROLE OF
HR AT INTERNATIONAL AID
The case
International Aid is a charity that operates as an NGO (non-government organization)
providing aid in the form of development projects in Third World countries, especially in
Africa. The projects may be educational, advice on healthcare, agricultural development or
constructional, eg schools or wells. They are funded by international organizations such as
the World Bank, the World Health Organization and the UK Government, but it is also
necessary for International Aid to raise funds itself to finance its headquarters operations and
some projects in their early stages. Projects are run by a leader from International Aid with
other International Aid specialists in the larger projects, although maximum use is made of
local nationals as members of the team. Currently there are 96 projects in 10 African
countries and two in a South American country. The total number of International Aid staff
working overseas is about 350. The headquarters of International Aid is in Cambridge and
employs about 200 staff in operations development and management, marketing and
fundraising, public affairs, finance and personnel management.
International Aid has run into some difficulties in recent years. It has had problems in raising
sufficient funds itself and it has been more difficult to get funding from the international
organizations and the UK Government. It has also been criticized for having too high an
expense ratio arising from inadequate financial control and, possibly, over-staffing.
Consequently, a new chair of trustees has been appointed and about half the other trustees
have been replaced, with a heavier emphasis on business and management expertise. The
Chief Executive of International Aid took early retirement and a new one was appointed. He
Chief of
Executive
was previously the Group HR Director
a large property development firm with extensive

overseas interests and his earlier career had been in financial management.
The new Chief Executive was instructed by the Trustees to take a very hard look at the
existing

organization
structure
and
the capabilities
ofDirector
the directors
Director of International
Operations
Director of Operational
Planning
of Finance
Director
of Fundraising
and Public Affairs

of Director
each ofofAdministration
the major

functions and report back with his proposals in three months’ time. The present organization
was:
International project directors

Head of
Fundraising

Head of Public Affairs

Financial Accountant

Head of IT

Head of Personnel

Head of Administrative
Services


The Chief Executive summarized his survey of the organization as follows:
● The Director of International Operations was a very efficient manager but had neglected
her responsibilities for ensuring that overseas staff were properly selected, briefed
and trained, possibly because in an ill-defined way the Director of Operational
Planning was involved in staffing – the distinction between the two roles was unclear,
which led to confusion and overlap.
● The Director of Finance was technically good but had allowed the department to be
overstaffed and needed the support of a qualified management accountant rather
than an unqualified accounting administrator who was a glorified clerk.
● The Director of Fundraising and Public Affairs did not have enough to do and was in
any case hampered by an inadequate Head of Fundraising.
● The Head of Public Affairs was good at her job but was given little scope by her Director
who was essentially a fundraiser. The result was that the organization was not
presenting itself adequately to the Government and the international funding
organizations or the public at large.
● The Director of Administration did not have enough to do to justify his position and the
administrative side of his department was grossly over-staffed; the Head of IT and
Head of Personnel were quite capable of carrying out their roles without him.
● The Head of IT was effective and could contribute much more given better leadership.
● The Personnel Manager was perfectly adequate in her primarily administrative role but
was given no scope or encouragement to contribute more, although it was unlikely
that even given that scope she could do so.

● The quality of some overseas staff was inadequate, which has led to questions from
funders about the ability of International Aid to deliver on its project obligations.


● The rate of turnover of overseas staff was far too high; it seemed that they were
inadequately trained or prepared for their duties (the responsibility, oddly enough of
the Director of Operational Planning).
To deal with these problems the Chief Executive proposed the following new organization to
the Trustees (only posts affected by the reorganization are shown):
Chief Executive

Director of Operations

Director of Finance

Director of Fundraising

Head of Operations Planning* Financial Accountant

Management Accountant*

Director of Public Affairs

Director of HR*

Head of HR Services**

Head of Organizational Learning*

Head of IT

Head of Administrative Services
* new post
** previously Head of Personnel

The reaction of the Trustees to this proposal was on the whole favourable. They grumbled
that there seemed to be a lot of new posts, but the Chief Executive made a persuasive
business case to the effect that they would provide added value. They also questioned the
creation of a Director of HR responsible to the Chief Executive. A number of Trustees
objected strongly to the term ‘human resources’ on the grounds that it was a demeaning
concept that treated people as mere resources to be exploited by the organization. Others
asked if this post was significant enough to justify its position as a member of the senior
management team, while others wondered what a Head of Organizational Learning was
when he or she was at home.
The Chief Executive was therefore asked to report back to the Trustees with a further
justification for this proposal. They wanted to know what added value would be provided by it, ie
what, specifically, an HR function would contribute.


The task
Prepare this justification for the Trustees.

Comments
This case explores some fundamental issues about the role of HR and, but only incidentally,
why it should be called ‘HR’ and not ‘personnel management’.
Taking the last point first; the answer is that it doesn’t really matter and some people get over
the ‘demeaning’ implications of HRM by calling it ‘people management’. But it has to be
recognized that HRM as the name of the process and HR as the title of the function are now
common parlance. This might not be enough to satisfy someone hostile to the connotations of
‘HRM’ but there are some essential differences in the concepts as set out in Armstrong’s

Handbook of Human Resource Management Practice (Table 6.1, pages 126–27), the most
important being the strategic and business-oriented nature of HRM, its emphasis on integration
or fit, and its belief that employees should be treated as assets, not costs. Research carried out
by Hoque and Noon (referred to on page 105 of Armstrong’s Handbook of Human Resource
Management Practice) found that people described as ‘HR’ tended to be more strategic than
those described as ‘personnel’.
In this case there are some strong pointers to the need for a strategic HRM approach. It can
be assumed that the strategic goals of the charity are to plan and deliver more successful
projects, to run the charity as a whole as well as individual projects more cost-effectively, and by
so doing generate more finance from funders and the public. This depends on having highquality staff working on projects and directing their work from headquarters as well as better
quality people in fundraising and public affairs. The onus for doing this rests with line
management but a strategically oriented HR function can make a significant value-added
contribution by providing advice and services that support the achievement of strategic goals
through recruitment and selection, learning and development programmes (with an emphasis
on organizational learning) and talent management. In other words, as an HR function rather
than one simply providing basic personnel services, it can make a major contribution to
organizational success.
Further reading in Armstrong’s Handbook of Human Resource Management Practice:
Chapters 1, 3 and 5.