FY021 Introduction to Business Studies Assignment Sample

Introduction - HR and Financial Strategies of The Body Shop

The Body Shop is a famous British brand of cosmetics, skincare, personal care products, make-up, beauty and perfumes founded on 27 March 1976 by Dame Anita Roddick. It is headquartered in London Bridge, UK with current revenue of 5.3 billion dollars. It uses natural and eco-friendly materials in its products due to its commitment to use sustainability practices in its processes. The business gained popularity for its dedication to social and environmental causes, leading the charge against animal testing and promoting fair trade practices in the beauty industry. The report will discuss the body Shop company's human resource (HR) and financial management strategies to analyze its strengths and weaknesses. The report gives clear justification for the recruitment, training and development reward strategy in HR, and profit & loss and balance sheet strategy in finance.

Information on the Human Resources (HR) strategies of the body shop

Body Shop is a UK-based cosmetics, personal care, skincare, and perfume company. The company's HR strategies focus on creating a suitable environment for employees where they can easily communicate with senior executives about any problem or issues, or conflicts, and they may feel motivated and inspired in the organization. They are strongly committed to social responsibility and use ethical practices in their processes, to ensure that their staff members feel supported and healthy. Body Shop may place a strong importance on employee well-being by providing support programs, flexible work schedules and possibly wellness activities (Collins, et. al, 2021). It spends money on training and development initiatives to support staff member's performances and advance them to make sure they hold the abilities needed for the positions. Internal communication must be operative for employees so that they can express their feelings, thoughts and views regarding any issue.

Company promotes open lines of communication to ensure that everyone feels on an equal path. They involve workers in diverse ways, such as by organizing team-building trainings, executing recognition initiatives and boosting a feeling of pride within the business. Encouraging a comprehensive and varied workplace is essential. The Body shop focuses on fostering an atmosphere in which each person is treated with dignity and respect. Firm has plans for finding and keeping talent, possibly with the help of attractive benefits packages, chances for professional development and a helpful workplace atmosphere. They give benefits to employees like health insurance, discounts and other benefits (Doz, et. al, 2020). The body shop has specific recruitment, training and reward strategies for placing a strong emphasis on sustainable practices and ethical hiring in their procedures and systems

Recruitment approach: It is a value-driven and historical approach, the company look for its values of environmental sustainability, ethical business practices and social responsibility towards employees (Köchling and Wehner, 2020). The business tries to attract talent from various backgrounds and create a diverse workforce by laying more focus on aspects related to diversity and inclusion (The Body Shop HR strategy, 2023). The aim of the company is to create a workplace that welcomes people with different backgrounds and perspectives.

Training and development approach: It includes personal & professional development pertaining to knowledge about products or services offered. In this, the company needs to consider its nature to serve employees according to them. Staff members have received in–depth training on the company’s products, covering topics such as components, benefits, and effective customer service techniques from business (Situmorang, et. al, 2021). The company commonly funds training initiatives to promote the personal and professional development of employees. This may include training in customer service, leadership and other relevant areas to assist in employee development.

Rewards: It includes the benefits of employees and recognition for ethical practices. In the past time, company have provided competitive benefits packages to their staff members, which may include discounts on merchandise, health insurance and other benefits. The body shop rewards staff members who actively participate in the business’s social responsibility, sustainability and ethical initiatives according to the performances of history. They conduct programs for employee recognition or incentives to participate in parallel activities. These strategies may evolve in response to changing workforce demands and changing business needs (Shafagatova and Van Looy, 2021). It is possible that the body shop changed its hiring processes, stretched the scope of its training initiatives, and restructured its incentive plans to maintain its competitive edge and remain right to the principles of ethical business behavior.

The strengths of the HR in Body Shop are an ethical focus on suitability and fair trade practices in HR, encouraging employee engagement towards business operations, investing money in development and training for employees including knowledge of product and personal development, strong brand image make value for the company, foster an inclusive culture and promoting innovation, technology and understanding in business. On the other hand, it has some negative impacts on HR that are called its weaknesses. They have limited scale or areas for career advancement and development of the company, employee turnover because of changing market conditions, competitive compensation affects ethical practices and values in the competitive landscape, balancing of potential resource constraints should be hard for HR, adapting to new changing market trends, as per expectations of employees and technologies is a big challenge for the company to survive in the market

Information on the financial management strategies of the organization

Financial ratio has been determined on the financial statement of the company to identify the company’s position. Through this ratio liquidity, profitability, solvency and efficiency of the organization have been identified (Financial statement of The Body shop, 2022). This helps in determining the various measures through which the position of the company could be improved.

Return on assets

This is the type of profitability ratio which is calculated to identify the efficiency of the total assets being used by the management in generating profit. The ideal return on assets is considered to be more than 7% which indicate that the company is in good conditions. This indicate that the company is effectively using its assets in the generating the profit. Return on equity

To identify the company’s efficiency in generating income for the shareholder by using their funds, return on equity has been calculate, The ideal ratio for the company is 15% to 20% which indicate that company is able to generate effective return (Raju, 2020). This is the type of profitability ratio and the company should focus on increasing its sales which will maintain the ratio. Interest coverage ratio

It is the types of profitability ratio which help in identify the number of time the net income if the company can cover the interest liability. The ideal ratio for the interest coverage ratio is 1.5 time. This indicates that the company is having a good ICR that mean that they could cover the interest form the profit and they will face any financial crisis. Current ratio

The company is having current ratio of 0.88 which is less them the ideal ratio of the company. This indicates that the company will unable to pay all the short term obligation of the business (?irjevskis, 2023). This indicates that the company has not effectively invested in the current assets. To improve the ratio the company should delay the purchase of the fixed assets and invest in purchase of the current assets. Quick ratio

The company is having very less quick assets ratio s compared to the ideal ratio. These indicate that the company will unable to pay off his liability by selling all the current assets except the inventories. To improve the ratio the company should invest in the purchases of the quick asset. Inventory control measures should be used to identify the exact amount of the inventory which will help in saving the excess amount. Gross profit ratio

It is the ratio calculated to identify the profitability position of the company. This ratio indicates the efficiency of the company in generating the profit and increasing the ales. The company is having an effective ratio and company should try to improve the ratio (Ullah, et.al, 2022). This could be done by implementing various marketing strategy which will help in improving the sales. Assets turnover ratio

This is the type of ratio which indicates the company efficiency in generating the profit by using the assets. Effective assets turnover ratio is above 2 which indicate that the company is not efficient in using its asset. To improve the ratio the company should focus on selling the asset which are not effective and try to improve the sales. Leverage ratio

This ratio indicates the amount of debt in the total capital and the efficiency of the company in meeting its financial obligation. The company is having very high amount of ratio which indicate that there is high amount of risk associate with the company.

Conclusion

In summary, the report was about the effective human resource and financial strategies of the body shop company. It can be seen in the report that significant measures have been taken for enhancing recruitment strategy, training & development, reward and financial management. The company also analyzed the strengths and weaknesses of the human resources and financial management strategies within the body shop context. In this, the both strategies HR and finance give contribute to its success and growth. The strong emphasis of HR strategies towards their internal operations, brand image, building trust & confidence, sustainability practices and overall success contribute to the success of The Body Shop. While the financial strategies are also important for the overall growth of the business, they make investments in the training and development of employees, ethical and sustainability practices and managing the resources of the company.

References

Books and Journals

• ?irjevskis, A., 2023. Managing competence-based synergy in acquisition processes: Empirical evidence from the ICT and global cosmetic industries. Knowledge Management Research & Practice, 21(1), pp.41-50.
• Collins, C.J., 2021. Expanding the resource based view model of strategic human resource management. The International Journal of Human Resource Management, 32(2), pp.331-358.
• Doz, Y., 2020. Fostering strategic agility: How individual executives and human resource practices contribute. Human Resource Management Review, 30(1), p.100693.
• Köchling, A. and Wehner, M.C., 2020. Discriminated by an algorithm: a systematic review of discrimination and fairness by algorithmic decision-making in the context of HR recruitment and HR development. Business Research, 13(3), pp.795-848.
• Raju, K.P., 2020. AN ANALYSIS OF LIQUIDITY MANAGEMENT OF SELECTED COAL COMPANIES IN INDIA. Editorial Board, 9(7).
• Shafagatova, A. and Van Looy, A., 2021. A conceptual framework for process?oriented employee appraisals and rewards. Knowledge and Process Management, 28(1), pp.90-104.
• Situmorang, T.P., Indriani, F., Simatupang, R.A. and Soesanto, H., 2021. Brand positioning and repurchase intention: The effect of attitude toward green brand. The Journal of Asian Finance, Economics and Business, 8(4), pp.491-499.
• Ullah, F., Khan, M.Z., Mehmood, G., Qureshi, M.S. and Fayaz, M., 2022. Energy efficiency and reliability considerations in wireless body area networks: a survey. Computational and Mathematical Methods in Medicine, 2022.

Online

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• The Body Shop HR strategy, 2023. Online. Available through. : < https://documents.exchange/the-body-shop-a-hrm-strategy>
• Financial statement of The Body Shop. 2022. Online. Available through: < https://www.statista.com/statistics/1005248/the-body-shop-revenue-worldwide/#:~:text=The%20revenue%20of%20the%20British,compared%20to%20the%20previous%20year.>