Mattel is the worldwide leader in the design, manufacture and marketing of toys and family products in 150 countries. The company's main products include Barbie, Fisher-Price toys, Hot Wheels and Matchbox cars, American Girl dolls and books and items licensed by Sesame Street, Barney & Friends and Ferrari. In 2000, Robert Eckert replaced Jill Barad as CEO of the company. Soon after, he came to realize the importance of creating a basic workforce management plan for the company. That would motivate the workforce and generate a more skilled and competitive workforce. He decided to set up a systematic succession strategy that would help the company to retain its original talent.
Key elements of Mattel's HRM strategy
Mattel's HRM strategy constitutes the following:
• Leadership development
• Succession planning
• Performance tracking
• Motivating the workforce
• Employee training
CRITICAL EVALUATION OF HRM STRATEGY IN RELATION TO THEORIES
‘Leadership Development refers to any activity that enhances the quality of leadership within an individual or organization'. (Robbins et al., 1996)
In Mattel, ambitious initiatives were proposed to make the workforce more disciplined. The idea was to create tangible development programmes to generate a more skilled and competitive workforce.
By succession planning we mean the development of “high potentials” to effectively take over the current leadership when their time comes to exit their positions (Morgan Witzel, 1999)
Eckert wanted to set up a systematic succession strategy at Mattel that would enable the company to retain its home-grown talent. The new succession planning process encouraged executives in strategic positions to exchange the information with one another and among employees at different levels. There was a 360-degree feedback system that let employees know how well they were doing.
Motivating the workforce
“Motivation is defined as a driving force that initiates and directs behaviour. In other words, motivation is a kind of internal energy which drives a person to do something in order to achieve something.” (Richard Romando, 2007)
Getting the company on healthy footing is an essential step for any organization and so does for Mattel. Eckert realised the importance of motivating his workforce to get best possible results from them. For that he decided to carry out following actions.
• Internal promotion
In Mattel, Eckert focussed on internal promotion. That is why 75% of open positions are filled internally to increase the internal promotion level.
• Employee opinion survey
Many of talent development seminars are carried out at Mattel that serve as a platform for employees worldwide to exchange their ideas and advice and also encourage them to reach out.
“Training involves an expert working with learners to transfer to them certain areas of knowledge or skills to improve in their current jobs.” (John et al., 2008)
Eckert wanted to reduce the “throw spaghetti against the wall and see what sticks” dynamic that was in place at MATTEL. His solution was to train and develop the company's people to make them competitive and properly skilled.
MATTEL'S HRM STRATEGY & CURRENT EXTERNAL ENVIRONMENT
Below is the assessment of Mattel's HRM strategy in relation with current external environment:
Today people look for budget friendly toys that lend themselves to long-lasting play. Also changes in the growth of employment are also affecting demand. Therefore Mattel must keep a check on their price levels.
The expectations of consumers about the quality of toys are increasing day by day which requires continuous quality assurance by Mattel. Also there is a rising trend of computer games which helps Mattel to gain market share. Furthermore, Toys at Mattel also help children to learn social norms by teaching them certain kinds of play.
The absence of quality of toys in market is an opportunity for Mattel to step into to gain more market share. Also, development of interactive software programs may help the company a lot as there is a high demand of variety of software programs. It has been noticed that the tiny magnets used in the manufacturing of toys may fall off the toys which are deadly if swallowed which is a kind of threat to Mattel.
Customer looks for product quality, safety, affordability and uniqueness of the product. However Mattel needs to create some common aspirations and fantasies for boys and girls to attract them towards toys market.
There are various competitors of Mattel including Wal-Mart, Toys R Us, Hasbro, Louis Marx and Milton Bradley. The ability to retain talent is particularly critical in the fiercely competitive toy industry.
Mattel is facing a high threat of both new entrants and its competitors. Changes in consumer sentiment also have a significant effect on demand. Competition in this industry is high and increasing. A changing market, shaped by the emergence of new competitors and the increased bargaining power of retailers like Wal-Mart, has made the industry particularly complicated.
POTENTIAL ISSUES FACED BY MATTEL
Mattel was looking for a more strategic balance between ‘federal powers', which was the company itself, and ‘state powers', which were the individual business units i.e. to mould the standardised workforce management strategies to suit their individual needs so that they would all be carrying out performance management, succession planning and tracking using certain guidelines, but there would be a degree of personalization.
Following were the potential issues that the company had to face in balancing the organisational HRM Strategy with divisional ‘personalization'.
• Rigid Silo Mentality
• Mattel's inefficient level of commitment to workforce development
• Excessive Employee Turnover
• Lack of Creativity and innovation of talent
• Poor Communication
• Weak Team Spirit
• Lack of employee training
• Lack of Motivation in Employees
• Lack of close-knit communities and strong group dynamics
• Disconnected subcultures
• Absence of ‘One Vision/Goal'
The overall analysis of Mattel's HRM strategy shows that all of the top managers at Mattel tried to run the company in the best possible way in their respective time period. But somehow there had been some critical issues that were not handled accurately which led to the company's decline at some stage. However, Eckert's strategy to lead the company towards its unified goal by understanding the importance of workforce management along with other monetary concerns was successful to some extent. However it's important for a company to focus on following key issues for long-term success.
• Employee Motivation should be considered as a major function of Management.
• Multi-tasking and employee shuffling within the organization is necessary for broad vision and proper understanding of the company's objective.
• Knowledge Management should be considered a key strategic resource when it comes to the competitiveness of a company.
• Management should be able to find ways of making production more cost-effective.
• Self-discipline and willingness to take risks must be given due importance.
Stephen Robbins, Bruce Millet & Terry Waters-Marsh (1996) “The Leadership Development Handbook”, 4th ed, published by Prentice Hall
Morgan Witzel, (1999), UEBN Dictionary of Business and Management
Richard Romando (2007) “Define Motivation”
John Van Liew Morris (2008) “A Study of Education and Training Departments in various corporations”
Amabile, T. (1996): Creativity in Context: Update to the Social Psychology of Creativity, Boulder, CO.
Richard M.Steers, Lyman W, Porter (1975) “Motivation and Work Behaviour”
Thad B.Green (1992): Performance and Motivation Strategies for today's Workforce.
S. Cromwell & J. Kolb (2004) “An examination of work-environment support factors affecting transfer of supervisory skills training to the work place”, Human Resource Development Quarterly.