HR Margdarshan 2017

Background
This document contains the type of information presented to a companys Board of Directors and the kind of
feedback HR would expect to receive. The role of HR is then to provide strategic advice to the Board in order to
achieve the best possible financial outcome resulting from HR related decisions.

Contents
Annual Report............................................................................................................................................................. 2
Chairmans Report .................................................................................................................................................. 3
Operational Report ................................................................................................................................................. 4
Financial Report ...................................................................................................................................................... 5
Human Resource Report ......................................................................................................................................... 6
Risk Avoidance .................................................................................................................................................... 7
Employee and Organisation Effectiveness ........................................................................................................... 8
Talent Attraction ................................................................................................................................................. 8
Talent Retention ................................................................................................................................................. 9
Talent Enhancement ........................................................................................................................................... 9
Improved Productivity and Service Delivery....................................................................................................... 10
Periodic Human Capital Management Report to Board ............................................................................................. 11
Issues and comments from the Board requiring strategic advice ............................................................................... 17
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Annual Report

2016 Annual Report

NOTE: is a fictitious airline created for a business simulation competition Commented [HU1]:

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Chairmans Report
The airline faced difficult circumstances during 2016 and sustained a small loss for the year. Whilst operational issues
made it difficult to forecast with any degree of certainty it was the workforce issues that had to be closely managed
to avoid a greater loss.

During 2017 we expect to again face difficult circumstances and the global economic outlook does not look for
international airlines. MARGDARSHAN Airlines faces increasing competition from other regional airlines, many with a
lower cost structure and greater capitalization than Margdarshan Airline. There is an over-supply of capacity on
many routes Margdarshan Airline flies. Based on effectively managing all external factors that impact the companys
airline operation we still expect to lose $250 million dollars in the first half of 2017 and possibly incurred up to $500
million for the full year.

There will be workforce challenges again during the year with possible retrenchments as we endeavour to cut costs.
The manner in which we are able to manage day-to-day HR issues will determine the number of staff we need to
reduce and the speed with which we are able to recover from the present situation. The company looks to the HR
department to provide guidance and strategic advice to return to a profitable status and allow the company to
establish profit targets for 2017. In particular, the areas where we expect HR to provide help are:

Avoiding risk: To make sure we do not expose our airline operation to staff shortages in critical areas.
Reviewing employee and organisation effectiveness: To ensure the airline is as competitive as possible and
utilising our resources to achieve the best possible outcome.
Acquiring the right talent: To build the companys workforce into the best and brightest in the industry.
Retaining our talent: To ensure that our best performers are not lost by reviewing the companys
compensation and benefits practices and identifying all other factors important to staff.
Enhance the effectiveness of existing talent: To identify and conduct the kind of employee development
needed to engage and motive staff.
Improve employee productivity and service delivery: By examining employee performance and output and
conducting service delivery surveys to identify areas for improvement and recommend strategies.

With operational efficiency and effective management of our most HR resources we expect to return a profit again
in 2017, but there is a dependency upon developing the right strategies to navigate our way through the challenges
ahead and minimize our losses in 2017.

Chairman of the Board

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Operational Report
During 2016 there have been major disruptions to operations due to cyclones and bad weather in the Asia Pacific
region resulting in flight cancellations and lost passenger loads.

The global economic crisis has impacted passenger bookings and the number of travellers has declined from the
previous year.

Some airline routes to Asian countries in the region are still performing well, in spite of the global economic
conditions.

There have been several new airlines launched in competition with Margdarshan Airlines and threaten to impact on
our profits in some of our best performing routes.

There is a concern over productivity levels and Margdarshan Airliness ability to compete with other airlines lower
cost structures. The lower costs are forcing Margdarshan Airliness prices down and eroding profit margins.

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Financial Report
Margdarshan Airline is a low cost airline offering travel in the Asia Pacific region. Margdarshan Airline does not offer
a premium service and relies on volume and full aircraft to make a profit. Competition is fierce and profit margins
are low. The airline industry is cyclic and has high and low periods for travel.

As the result of the fierce competition Margdarshan Airline is predicting a loss of $501 million for the 2017 financial
year. The loss represents a 3.08 percent of revenue outcome.

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Human Resource Report

Staffing Profile:

Margdarshan Airline has 30,000 regular staff and a further 5,000 contractors. Most staff are located in India,
Australia, Singapore, and Hong Kong. Small numbers are located at airports around the region where Margdarshan
Airline operates. Staff are mostly unionised in India. Most staff have been with the airline for over 5 years.

General Issues:

Promotional opportunities within the airline are limited due to the low staff turnover. The company has undertaken
surveys within the company to measure employee engagement levels and compensation satisfaction with less than
positive results.

Strategic Challenges:

1) The airline has plans for growth in the region with increased destinations offered to travellers.
2) Expansion plans call for increased staffing in certain countries.
3) Competing airlines are trying to attract staff away from Margdarshan Airline.
4) The company has very rigid pay scales based on job measurement and rates are set in accordance with the
salary practice market
5) Morale in the airline is down due to the gloomy economic outlook, fewer travellers and job security fears
especially in view of possible retrenchments..
6) There is a fear that low morale has contributed to increased absence and poor performance by some staff.
7) The lack of promotional opportunities is causing discontentment amongst some of the high performers and
there is a danger of losing good staff.
8) Eroding profit margins are making it difficult to offer additional salary and benefits to staff and satisfy unions
log of claims.

Note for HR Margdarshan Game Players:

The HR Margdarshan game prepares HR professionals to take their seat at the Board
table and advise on responses to challenges and strategies.

Technology and Business Information:

1) The company is using multiple HR systems with integration to a common database platform. The companys HR
technology roadmap is to bring all products onto the one Cloud based HR platform to eliminate data transfer
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between applications.
2) Data is imported from financial and operational systems and stored on the common platform to produce the
metrics necessary to help understand and manage MARGDARSHAN AIRLINEs workforce.
3) HR Metric Reports are produced from the common platform and made available through a dashboard
presentation.

HR Metrics Platform
To conform with the Chairman of the Boards desire to better manage the companys human resources the following
reports are produced within six subcategories. The six major categories are:

Risk Avoidance
Employee and Organisation Effectiveness
Talent Acquisition
Talent Retention
Talent Enhancement
Improved Productivity and Service Delivery

The HR metric reports within each category are:

Risk Avoidance

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Employee and Organisation Effectiveness

Talent Attraction

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Talent Retention

Talent Enhancement

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Improved Productivity and Service Delivery

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Periodic Human Capital Management Report to

Board

The following workforce metrics indicate the companys exposure to risk through the loss of working hours due to
absence, the risk of non-availability of employees to service the airlines operations due to industrial dispute and risk
of non-compliance with safety requirements and the provision of a safe work environment.
1. Absence Rate 2. Grievance - Time to Resolve

3. OH& S Incident Time Breakdown More online workforce metrics

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The following workforce metrics is intended to review employee and organisation effectiveness and ensure the
airline is as competitive as possible and utilising our resources to achieve the best possible outcome.

1. Staffing Rate Revenue Generating 2. Return on Human Investment Ratio

3. Performance Rating Distribution More online workforce metrics

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The following workforce metrics are intended to make sure the company is acquiring the right talent to build the
companys workforce into the best and brightest in the industry.

1. Market Compensation Ratio 2. Compensation Satisfaction Index

3. Recruitment Source Breakdown More online workforce metrics

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The following workforce metrics are a measure to ensure the company is retaining its talent and ensure the best
performers are not lost. The metrics review the companys compensation and benefits practices and identifies all
other factors important to staff.

1. Benefits Satisfaction Index 2. Average Termination Value

3. New Hire Failure Factor More online workforce metrics

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The following workforce metrics are intended to make sure the company is enhancing the effectiveness of existing
talent. The metrics identify the kind of employee development needed to engage and motive staff.

1. Positions without Candidate Ready 2. Promotion Rate

3. Training Hours per FTE More online workforce metrics

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The following workforce metrics are intended to identify measures to improve employee productivity and service
delivery. The metrics examine employee performance and output and reports on service delivery surveys to identify
areas for improvement.

1. Payroll Error Rate 2. Employee Engagement Index

3. Contact Centre Average Handle Time More online workforce metrics

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Issues and comments from the Board requiring

strategic advice

The following workforce metrics indicate the companys exposure to risk through the loss of working hours due to
absence, the risk of non-availability of employees to service the airlines operations due to industrial dispute and risk
of non-compliance with safety requirements and the provision of a safe work environment.

1. Absence Rate 2. Grievance - Time to Resolve

3. OH& S Incident Time Breakdown More online workforce metrics

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 HR Margdarshan 2017 Companion Document

The following workforce metrics is intended to review employee and organisation effectiveness and ensure the
airline is as competitive as possible and utilising our resources to achieve the best possible outcome.

1. Staffing Rate Revenue Generating 2. Return on Human Investment Ratio

3. Performance Rating Distribution More online workforce metrics

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The following workforce metrics are intended to make sure the company is acquiring the right talent to build the
companys workforce into the best and brightest in the industry.

4. Market Compensation Ratio 5. Compensation Satisfaction Index

6. Recruitment Source Breakdown More online workforce metrics

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 HR Margdarshan 2017 Companion Document

The following workforce metrics are a measure to ensure the company is retaining its talent and ensure the best
performers are not lost. The metrics review the companys compensation and benefits practices and identifies all
other factors important to staff.

4. Benefits Satisfaction Index 5. Average Termination Value

6. New Hire Failure Factor More online workforce metrics

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 HR Margdarshan 2017 Companion Document

The following workforce metrics are intended to make sure the company is enhancing the effectiveness of existing
talent. The metrics identify the kind of employee development needed to engage and motive staff.

4. Positions without Candidate Ready 5. Promotion Rate

6. Training Hours per FTE More online workforce metrics

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 HR Margdarshan 2017 Companion Document

The following workforce metrics are intended to identify measures to improve employee productivity and service
delivery. The metrics examine employee performance and output and reports on service delivery surveys to identify
areas for improvement.

4. Payroll Error Rate 5. Employee Engagement Index

6. Contact Centre Average Handle Time More online workforce metrics

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