Managing Human Resources: Aes Corporation Case

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Managing Human Resources: AES Corporation Case

Final Exam Case
MGT 412

Respectfully submitted by:

Frank Rizzo

AES Overview:
AES managers exemplify the leadership it takes to run an HR-minded organization. Leadership is mandatory for the success of AES as the organization continues to have a competitive advantage over its competitors. The core competency of AES is the core values that all their employees follow. Bakke’s description of the purpose of AES is “to steward resources to meet the needs of society. AES strategic goal is to continue its success to meet the needs of society but to do this AES has established the most impressive HR-minded culture that all their employees perform. AES employees are given the freedom to do their work as long as it follows the corporate strategy. Employees are compensated by their performances that provide the success of AES for many years. My recommendation comments on the need for AES to grow and continue to effectively use their human capital. Employees look for career growth, new projects to conquer and for some people that might end if AES doesn’t consider moving more into the global market. I recommend that AES hire or recruit a full time HR staff that will help them move into the global market by conducting research, organizing the company to fit into local culture and lifestyles. This is a strategic move that will be easy for AES to make because they can continue their core competency as an HR-minded organization.

AES Investment Orientation:
AES clearly shows that it has adopted an investment orientation towards human resources. Their mission statement states that its people are the central of its strategic strategy. Bakke’s describes the purpose and mission of AES is “to steward resources to meet the needs of society” which shows that he sees the people as being central to its strategy. There are four major factors that affect how “investment oriented” a company is in its management of human resources.

1.Management values: AES mission statement includes the core value: “Fun…For us, ‘fun’ means establishing an environment in which people can use their gifts and skills to make a difference in society without the fear of being squelched. Creating a fun workplace environment requires a positive view of humanity that begins with the people who work in the corporation.” This is the most important value in their mission statement because it sets the philosophy of the organization that prevents the depreciation of its human assets and gives them a competitive advantage that is not replicable.

2.Attitude toward risk: Blakke understands the trade-off between risk and return. AES holds to its values so strongly that it had to list its adherence to its values as a possible impact on the results of operation on the Securities and Exchange Commission. AES shows that their employees are an investment for their success and have developed strategies to reduce the risk of losing their investment.

3.Skills needed by employees: Technical skills at AES are believed to be easily learned by anyone. People that are self-motivated, dependable and are looked at as a characteristic that fit the organization. These characteristics are developed skills that are not transferable to other organization because many corporations do not give you the freedom to work and make frontline decisions.

4.Cost-benefit analysis: Most employees at AES are paid on a salary system which enables the workers to “be their own boss” and the freedom to make their own decisions. If an employee sees the need for a capital improvement they simply get some bids that are cost effective and implement them. This gives AES the advantage to enhance efficiency

Inclusion AES has developed an effective strategy to manage their human assets as an investment. This approach helps make sure that AES’s strategic HR practices match perfectly with the organization’s overall...
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