Becton Dickinson Case Memo
Summary of the key issues
Becton Dickinson (BD) is a large family-owned corporation with headquarters in New Jersey that emphasizes healthcare and diagnostic devices. Founding in 1897, BD has established its reputation based on a paternalistic human resource philosophy, e.g. never fires anyone, and rewards loyalty. Things had changed when Roger Kern was appointed as the vice president of human resources in 1981. He created a first-class traditional HR function at BD that focused on education, compensation, benefit and other key HR functions. In the late 1980s, despite these substantial changes, problems began to surface. More and more employees complained most HR programs and functions were “less than effective”, “not realistic enough” or “unresponsive to particular needs’, and many managers began to sense that Kern had failed to assemble a strong business-oriented staff of corporate HR professionals.
At the same time, economy recession, declined sales and troubles encountered in BD’s business had led to a dramatic corporate strategy change. Besides cost control and head count reductions, giving up its ambitious acquisition and over-extended policy, BD has become more focus on its core and basic strengths-healthcare business. Meanwhile, BD’s top management realized that Kern had not put in place an HR infrastructure that adequately supported new business strategies- “the role of human resources changed.” In 1987, BD introduced the concept of strategic human resource management (SHRM) and defined it as a way of thinking about business and people and how to bring about organizational changes to improve performance. In October 1988, Kern left BD and Jim Wessel had been appointed as the new head of HR because the top management knew that he understood business strategy and had ample experience.
Soon after Wessel assumed his position, he fell into two broad categories: identification of major human resources issues at BD and assessment of the corporate HR function. He solicited views from key managers and interviews were conducted with top management. Then, he must make his decision about what to do next.
If I take the position of Wessel, based on the internal and external environment and the findings from the outside consultant, BD’s managers and executives, first, I can draw three conclusions as below-
First, BD’s HR function should be reshaped. In this time period, HR people have not been uniformly involved in strategic planning. They do not have enough understanding of BD’s business and the process of strategy development. Or, they do not have the awareness of an appropriate standpoint about the partnership between HR and business unit. The linkage between the HR function and BD’s business units is so weak that they do not know what the counterpart is doing. Managers of business unit do not know what to expect from an HR person. Along with the head count reduction, it seems that HR function has turned back to regular operation, administration and policy development. More importantly, HR person lacks confidence and proactive stance, business knowledge, and analytic and process skills necessary to fill consulting role.
Next, organizational development has come to a standstill. There was nothing in place at the point of entry to permit tracking of high potential individuals, no selection or monitoring system, and no program to identify high potential individuals. BD failed to systematically develop broad-based managers. Managerial skills need to developed in line managers; little cross-functional movement; people tie up key positions; lack actions to overcome problems; insufficient teamwork; lack enough capability to staffing talent.
Last, the compensation and benefit system should be improved to match the corporate strategy. Benefit programs were still in a piecemeal fashion, without an overarching strategy to link them to...
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