When conducting business operations, enterprises must always stay aware of the existing risks in order to avoid facing negative outcomes. The case study of Unilever demonstrates that modern organizations which operate in different markets should take into consideration different types of risks in order to stay competitive. Moreover, in addition to the standard types of risks, there are those related to human resources management (HRM), which should be addressed in advance because they have considerable disruptive potential and can occur unexpectedly. Thus, when conducting risk management and strategic planning, Unilever should become aware of HRM risks such as burn-out syndrome, discrimination, and the health and safety of employees.
First of all, it is important to assess the sources of risks faced by Unilever, which are listed in the case study. Namely, these are customer relationships, sustainability, and supply chain. In terms of customer relationships, the main risk encountered by Unilever is the conflict-of-interest problem which involves their customers being their competitors. Specifically, the large supermarket chains which buy Unilever’s products also have their own similar offerings, which compete against them (Wheatley, 2018). The sustainability risk arises out of the goal of Unilever to double the size of the business while simultaneously reducing the environmental impact. The primary risk in this regard comes from the decision of the company to grow the profitability of the business further, which can be difficult. Finally, there is a risk related to the supply chains of the company, which are exposed to several negative factors. For instance, the supply chains of Unilever can be disrupted due to bankruptcies of suppliers, environmental accidents, as well as industrial ones.
The case study shows the importance of risk management in order to successfully resolve any problematic situations, including in the sphere of human resources. For instance, one of the most prevalent risks in the field of human resources comes from burn-out syndrome, which can occur to any type of employee. The burn-out syndrome is a problem in the corporate world, and it arises among employees as a result of experiencing continuous stress and exhaustion (Lauer, 2021). Unilever is a large enterprise that has thousands of employees, and it is natural to expect that a certain share of the company’s workforce can be at risk of developing the burn-out syndrome.
Moreover, the syndrome can severely undermine the ability of employees to work effectively and thus can negatively impact the company. Thus, Unilever needs to introduce measures to reduce the probability of burn-outs by ensuring that employees are not subject to significant stress and have ways to contain it, for instance, through work with psychologists. At the same time, as demonstrated by the case study in question, it is important to keep a contingency plan in the event of problems (Wheatley, 2018). Therefore, Unilever needs to introduce a contingency plan designed specifically for employees who experience the burn-out syndrome.
Additionally, another risk in terms of HRM comes from the possible discrimination which can occur in the company. As mentioned earlier, Unilever has many employees and departments, and it subsequently can be difficult to monitor the workplace conditions effectively in every part of the business. As a result, the higher management can overlook the existing discrimination in the workplace, which can affect any employee but especially those belonging to the minority groups such as LGBTQ+ people. In such situations, it is obligatory for companies to have proper risk management mechanisms in place to prevent discrimination. For example, research shows that diversity and inclusion initiatives are effective tools for the eradication of workplace discrimination. Inclusion also positively affects productivity, organizational performance, and employee engagement and, therefore, should be taken into consideration (Banham, 2018). At the same time, whenever Unilever must introduce significant repercussions for employees who engage in discrimination, including the possibility of termination of employment.
Finally, since Unilever owns entire production facilities, it also needs to address HRM risks related to the health and safety of employees. Any type of production which involves working with complex machinery entails considerable risks for workers. Thus, the obligation of Unilever is to introduce appropriate measures to avoid any kind of health and safety risk. Unilever is aware of the risks inherent to its productions and therefore makes the safety of its workers a priority, including through initiatives such as Vision Zero, aiming at reducing workers’ fatalities and injuries to zero (“Safety at work,” n.d.). Essentially, it recognizes its responsibility and the importance of addressing health and safety issues in the workplace and maintains a high level of risk management.
Unilever must take into consideration the risks inherent to the HRM field, which are burn-out syndrome, discrimination, and the health and safety of employees. As noted in the case study, Unilever experiences considerable risks in different spheres, including customer relationships, sustainability, and supply chain. For instance, Unilever’s supply chains are exposed to possible disruptions in the form of accidents which can potentially hinder the operations of the company. At the same time, the business has to introduce a contingency plan for employees who suffer from burnout syndrome to avoid facing organizational problems. Additionally, Unilever needs to eradicate any type of discrimination in the workplace. Finally, the company must address the health and safety of its workers, including through existing initiatives such as Vision Zero.
Banham, R. (2018) The benefits of diversity & inclusion initiatives. Web.
Lauer, T. (2021) Change management. London: Springer.
Safety at work (n.d.) Web.
Wheatley, M. (2018) The 3 biggest risks facing Unilever. Web.