BUS 601 | Human Resource Management | Section 5 | Spring 2021

Quiz on ABC Learning: Collapse of an Entrepreneurial Venture

Submitted By:
Md. Borhan Uddin
ID: 2035097660

Submitted To:
Dr. M. Nazmul Amin
Department of Management
North South University
Date of Submission: 12th August, 2021
Q1. Identify and discuss the main business features of the childcare industry [Generate a
list of Competencies].
Answer: General knowledge and skills are an important foundation for adults with professional
responsibility for young children in all environments and sectors. We identify and talk about the
basics,
The Child Care Industry Business Highlights [Skill Overview] are below:
 The importance of reliable, stable, sustainable and protective connections that promote
progress and learn about different places and give children the ability to fully participate
in the opening.
 Natural and environmental variables that can strongly contribute or merge progress,
behavior and learning (e.g. positive and improvement outcomes) supportive and reactive
connections, constant stress and the negative effects of introduction after injury and
unfriendly opportunity, positive transformation of natural presentation).
 How a child creates clear content, including psychological emergence, information and
abilities, general learning abilities, socio-psychological improvement, and physical shift
and wellness.
 Adequate contact for good communication with young people who cultivate the word to
help young children move on and teach in a clear schedule, with clear learning exercise,
and in educational and other cognitive environments in a way that is appropriate for the
child's constructive level.
 Encourages positive social development and behavior and alleviates challenging
behavior.
 See the signs that children need to evaluate and refer to for specific administration For
example constructive delays, mental health concerns, need for social support or abuse and
Ignore and learn how to get data, resources and support from such people Help if needed.
 Decide on educated choices about how and when to use different types of progress
devices for promoting youth learning.
 A valid license is required to run the organization; as if it had not been shut down in the
meantime No one can complain about the organization.
 The government allowance must need to operate the industry with a legal document. The
government monitors the organization because some child care organizations cheat with
them nowadays help from twister people.
 Child care industry requires proper land and location to run the child care industry, and
have to be sure that no oxymoron land considered an undocumented by the government.
Appropriate security will be provided Children protect their lives and health.
 Learning ability to create and manage effective learning environments (physical space,
materials, Activities, classroom management). Establishing relationships and interactions
with children nurture and use positive language.
 Physical constantly try to improve the quality of exercise for their own physical and
mental management including the consequences of their own exposure to health,
adversity and stress.
Q2. Critically evaluate the main reasons for ABC Learning’s collapse. What are the lessons
learned from ABC’s mistakes?

Answer: The main reasons for the breakdown of ABC learning are given below:
 Poor Strategic Planning and Inorganic Expansion: Proper risk analysis has not been
done before rapid international expansion, making ABC Learning a highly respected
initiative. It is a term used in the business world to describe the expansion of an
organization through consolidation and acquisition, creating leverage in the market of
another organization’s products. This was the process that the ABC Learning Center used
for their expansion strategy. Through various mergers and acquisitions, they have crossed
international borders and occupied many day care and child care providers in New
Zealand, the United Kingdom and the United States. Because of this, businesses have
large loans, and at times loans exceed the capacity of the business. In a word, the
expansion of ABC Learning was based on loan and equity margins.

 Poor risk management: A large loan makes the business risky because leverage is too
high to repay. There was no risk management before the merger and acquisition that
raised their debt to .7 1.7 billion in 18 months. There was a lack of systematic accounting
practice, which meant that a professional accountant was not hired by the company.
There was also no professional recruitment for the finance department like the internal
auditor. The role of the government was also very important because there had to be
government control against consolidation and acquisition, which the Australian
government did not have there.

 Staffing Problems: ABC Learning does not have an experienced and skilled human
resources department. They had to take external assistance to meet the purpose of
recruitment, which incurred additional costs. They have a support provider called 123
Careers where ABC Learning has also faced a serious problem. The 3 9 million is
outstanding for their 123 careers, as well as the, 000 31 million 16,000 employee
compensation package problem, which is due to high turnover and a shortage of skilled
workers. Employees were uncertain about the safety of their work. The work was not
well distributed in all the centers, which meant that the relationship between the child and
the career was well managed. There were also some works that did not support the
standards of the industry.

 Less efficient management: ABC Learning was influenced by poor management and
poor and non-independent boards. First, ABC Learning CEO Eddie Groves was
completely inexperienced in this particular industry and the board of directors was a
politician. ABC Learning is therefore driven entirely by inexperienced management,
while management must have practical knowledge, as there is no advanced measure of
 service quality in this industry. Inexperienced management could not hire the right people
for the right places that could predict and protect the fall.

 Lack of HR practice: In ABC Learning, there was a lack of human resource practice
because there was no HR plan like job analysis, hiring and selecting the right person,
proper training and development. There was no performance management to evaluate the
performance of the employees. Employees were very concerned about the safety of their
jobs which could damage their performance level.

 Lack of regulation and control is the scapegoat and policies are made on the basis of
insight and superstition and extremely greedy capitalism. More cases of irrationally
dissatisfied individuals enterprise and the free market were bad. The fall of ABC clearly
shows how reckless it is children's businesses need to be re-controlled and regulated.
 The basic reason ABC broke down was because it was huge amount money for rapid
expansion in Australia and abroad. In the wake of the global financial crisis, it could not
reschedule its huge debt, so the administrators were called. Too big for ABC own good.
 The main driving force was the increased level of guidelines that currently exist in child
care, the main reason for the business was a high level of control. There is no other child
care market there is a player like ABC Learning in the world. The only reason it can
establish this influential position was extra control. Recognition of appointments and high
cost of staff values create significant barriers to entry and hinder competition the current
little control is a problem; there are also unintended bad consequences of excessive
control.
 Unnecessarily high cost of child care is probably the biggest problem. The high price is
just one insufficient supply of reflection. Childcare is expensive because there is a
shortage Place, which increases the price. Less control, which means lower compliance
costs and less Barrier to entry, means more providers?
 A business has grown in a capital city and should be serious and very helpful more
participants. As ABC has shown, there is a lot of cash in child care Business.
 The main reason is the high cost of complying with state and federal laws enough to
delay small business. The center is responsible for collecting financial information from
everyone Transfer to customer and government - an expensive process that a large
supplier prefers ABC can manage costs more efficiently.
 Lack of advanced techniques is a problem. Would be a good strategy for the government
allows child care operators to provide a variety of services and parents can choose
including their wallets. Parents who prefer cheap and cheerful child care are forced to pay
more for one the level of care they think is extra.
 The problem in the child care market is anything other than free market activities. The
rights story is that additional government control kept competition within distance,
resulting in higher prices when government subsidies raise prices further.
Finding: Ultimately, it is believed that the failure of the ABC Learning Center was not only a
failure, but it was the cause of all the investors in the business, the employees working in the
business and the mothers who raised their children. At their center, it is also difficult to take care
of their baby. It is very important to ensure the safety of the investors as well as the employees
working there.

For a business, the rise of ABC Learning was spectacular. Learned from the mistakes of
ABC
Below:

 Will is too high, too fast, and too expensive: the industry is well supported by the
population trends (increase in birth rate and increase in the number of working mothers,
and support large government subsidies that provide a solid platform for cash flow and
earnings). Grove's strategy for creating economies of scale through large numbers the
child care center has worked well. Don’t try to make a profit so fast.
 Strategic planning: ABC Learning needs to have a good strategy and plan for business
expansion. The business model of the ABC Learning Center was difficult to understand
and so they failed miserably. Management can play an important role in this situation.
They certainly followed a mission and vision and strategy to make the plan work. A
skilled worker with a set of core skills was very necessary for their business because they
help to create an effective business plan.

 Understand the appropriate investment: Because of the expansion, the ABC Learning
Center is investing heavily in indomitable resources. All of their acquisitions are based on
the recognition of operating care licenses, and a large portion of the investment is made
in good faith. In 2006, they invested about A 64 647.6 million in child care licenses and
about A 37 37.4 million in goodwill. The balance was full of indomitable wealth rather
than real wealth and that is why the ABC Learning Center later collapsed. This is a very
important accounting issue; how much money a business can invest in indomitable assets.
ABC Learning was already well-known, so it was a big mistake for them to invest more
in good faith.

 Forget about running a business: When groves was in control and focused, ABC never
used agencies get staff because it costs more. But when he was traveling and recruiting
Costs go down and profits go down. The lesson is clear - don’t let your big vision confuse
you that you actually run the business

 The account was a terrible mess: The ABC Learning Center was overwhelmed by their
o and could not pay. As a result, they will have to sell their centers in the United
 Kingdom and the United States. The trading price was A 8. 8.62 during the maximum
period and it has come down to A 0.5 0.54. They have been excluded from the ASX
market. ABC's audit activities and past company accounts years of trying to unravel the
complex path of analysis and profit, in particular in that method the compensation from
the center developers was calculated as income. We examine ABC's accounting practices.
If we think boring financial reporting, there will be results not transparent.

 Practice of corporate governance was weak: ABC always argued that the transaction
took place at a distance, but for many investors that was not the point. Get to know each
other Because weak corporate governance can tarnish a company's reputation and kill
investors confidence

 Recruitment of skilled HR professionals: The cost of Australian business, especially

staff costs, has hit significantly. When Groves was in charge and focused, ABC never
used the agency to get staff because it was too expensive. But while he was traveling, the
cost of roster and recruitment skyrocketed and profits plummeted. Recruiting qualified
HR staff can significantly reduce costs.

Finding: In short, ABC has made many mistakes to grow the learning business. The business
has been rather savings. Acquisition and expansion do not suddenly help the business at the
moment that a business does not create appropriate risk assessments and business strategies and
policies to support positive growth. The above lesson from the bug of ABC Learning is very
helpful for new entrepreneurs.

Q3. What HR policy regime do you recommend for a viable childcare industry? Explain.

Answer: Sustainable HR policy for children's industry is given below:

Skilled and Organized Human Resources Management: HR is a very important part of any
organization. So, in the case of a child care industry, there should be some jobs for the human
resources department. When we learned ABC, employees were very scared about the safety of
their jobs and dissatisfaction with benefits, salaries and work pressure forced many people to
leave the industry. A human resources department can play an effective role in maintaining
motivation levels among employees because productivity levels are not at risk. In addition, HR
can instruct management where it can be effective when needed.

It is clear that all organizations must have an effective and organized HR department for each
organization with a specific policy; otherwise it may collapse like ABC Learning. The job for a
childcare industry would be as follows:
Job analysis and job evaluation: Job analysis techniques include the use of interviews,
questionnaires, and observations. Job analysis provides a basis for job evaluation that determines
the relative value of different tasks in the organization. The relative value of different positions
determines the remuneration package associated with each job. Analysis of work for this industry
determines the responsibilities and skills required for the child care industry and who will be
hired for it. In this industry, mainly pre-school teachers, teaching assistants and child minders are
needed.

Job Description: An important element of both the remuneration and selection process, job
descriptions define responsibilities, requirements, functions, duties, location, environment,
conditions and other aspects of the job by writing. Helping children grow, learn, and learn new
skills can be very rewarding. Work must sometimes be routine; however, new activities and
challenges are emerging every day. Child care can be physically and mentally challenging, as
workers can constantly stand, walk, bend, bend, and focus on each child’s interests and
problems. Child care workers need to be constantly vigilant, anticipating and preventing
problems, dealing effectively with disturbed children and providing fair but disciplined
discipline. The timing of childcare staff varies. Many centers are open 12 hours or more a day
and cannot be closed until all children have been picked up by their parents or guardians. So
energetic and cool. There may be unplanned overtime. Employees must stay until all children's
parents come to pick up their children.

Job Specification: The job specification with the former dealing with various features and
responsibilities associated with the job, and the latter works with the required characteristics and
skills of the employer. Child care centers must have staffing requirements that determine the
country. Although requirements may vary, in most cases the minimum age for teachers must be
18 years and for directors or officers to be at least 21. In some places, 16-year-old assistants can
work 14-year-olds. Teachers must have a high school diploma and in many cases a combination
of university education and experience. Supportive and child care staff may require a high school
diploma. If necessary, a child care company must hire staffs who have received a certificate from
a nationally recognized child care company.

Analysis of conditional factors: A compensation plan is always made in the light of various
factors, both external and internal, which affect the effectiveness of human resource management
system. In order to analyze the external aspects of the child care industry, we need to consider
the state of the human resource market, the cost of living, the level of economic development,
social factors, trade union pressures and the various labor laws for compensation management.
Various internal factors are the organization's ability to pay salaries and employee-related
factors, such as performance, seniority, efficiency, etc. These issues can be analyzed through
wage / salary survey.
Evaluation and review: The compensation plan is not a rigid and fixed plan, but rather it is
dynamic because it is affected by various dynamic factors. Therefore, compensation
management must arrange for the evaluation and review of the compensation plan. Once the plan
is implemented, it will bear fruit, either in terms of intermediate variables such as employee
satisfaction and morale, or in terms of variable outcomes, such as in the case of increased
productivity. However, the next variable is more important. The assessment of the compensation
plan needs to be done in this light. If this does not work, the plan needs to be revised.

Payment structure: A wage structure should be established for the child care industry based on
hourly and monthly staffing, management, office, information supervision, management, etc.
Factors that may affect child care remuneration / payment structure, such as internal factors and
external factors such as: job evaluation and performance evaluation, employee, labor market,
cost of living, society, economy, geographical location

Recruitment and selection: There must be a clear staff policy in the recruitment and selection
process. The child care industry is a highly specialized industry, so HR managers need to
become proficient in accounting, finance, law and management. Before the final selection of an
employee, HR managers should clearly examine the referrals of the employee concerned, as
parents should never hand over their child to a criminal or a bad person. Kindness should not be
practiced like ABC Learning. The CEO and the board must be staffed by experienced and
qualified people.

Training and performance management: Since there is no measure of quality of service for
the child care industry, training and performance management are essential for a sustainable
child care industry. Every employee needs to be carefully supervised through performance
appraisal
Staff Management: A child care industry should manage its employees in an orderly manner. A
child care business requires a large number of employees. Employees need to be effectively
distributed to each center as per the demand of the concerned center. To reduce employee
turnover, a company must provide employees with adequate job security. Casual work is not a
good option for the child care industry, so HR managers need to focus on sustainable
employment.

Effective management decision: Since child care is a highly specialized industry, this industry
requires large investments and costs, so management decisions need to be effective. A wrong
decision can cause a company to collapse. Establishing a new center is very expensive, so
managers must be aware of the choice of premises for building a new center. In the case of
consolidation and acquisition, feasibility studies of management should be conducted. They must
have sufficient capital, justify, whether the place is suitable for construction of the center,
whether it will be suitable for both general public and business, how big the particular center
should be, how many workers should be employed for the center, investment How much should
be, what benefits should be given to a particular center, etc. An o must be done within a range.
The source of profit must be systematic (for example, improving the quality of service and
gaining new customers). Liquidity loss, compensation and government subsidies should not be
the main sources of profit. If a particular business does not have sufficient capital to establish a
center, it may choose a franchise option (such as a regional management company or RMC).
Although franchises are not a good option for the childcare industry, if one wants to develop a
franchise, HR managers need to run these franchises independently so that employees can
concentrate on their own parental activities.

 The goal is to ensure that child care companies employ high quality staffs who are
suitable to Advice and work involved, always on merit and in that way most appropriate
practice diversity and equal opportunity. Quality workers create long-term durability.
 To hire a co-worker, you must include a job description, a person's specification, and
select Organize team formation. Job details and person specification will be available to
the candidates considered as part of the recruitment process. Provides the basis of the
person's specification criteria for selection and method of use.
 The work is allocated in the pay band system with reference to the job evaluation scheme.
It ensure that work with the same work weight is treated consistently and fairly with pay
purpose This is simply an opportunity and an important way to not be equal the standard
of law, but the right treatment of our people.
 Hire an expert to maintain the organization. Experts support legitimacy of business in an
organized manner. The vision of wise men is quite sharp and they have made a legitimate
decision. Conduct is strictly followed by those who play an important role.
 Code of conduct includes ethics, honesty, integrity, commitment, loyalty, fairness;
respect others, obedience to the law, commitment to excellence, reputation and ethics,
leadership, liability.
 Injuries related to safety and emergency procedures and children's work should be
reported immediately. In addition, some regulations in terms of occupational safety and
health law Workers are required to implement specific policies and programs if there are
certain hazards in the workplace.
 The attendance policy makes it clear that employees must be prepared to get started
Provide ways to notify business every day of an unplanned absence Arrive late. It is also
a good practice to follow behavioral standards, drugs and alcohol related principles
Abuse, disciplinary action, privacy, conflict of interest and violence in the workplace.
 A timing policy lets you know who works in a child care organization is the most
important. The staff of the method of recording time, the work done and the importance
of accurate recording their time. Through the pay day policy, the employees can know the
 frequency and method of pay day Available for payment, and no special procedure when
a payday falls on a holiday When an employee is absent from work.
Finding: The collapse of the ABC doctrine was not the result of a serious debt and financial
crisis, but of many other issues. The role of the government was also an important point, as well
as the inexperienced CEO, the amateur board of directors, the wrong decision to manage at every
step, the untrained and incompetent department for human resources and much more. The vision
was perfect for the ABC doctrine, but the way to achieve the vision was wrong and as a result the
organization collapsed. Therefore, before entering a service industry highly specialized as a child
care industry, each company must consider all the information mentioned and hire each
employee in each department according to industry standards. The forecasting has to be done
very carefully so that the operations run smoothly and firmly. Financing should be protected by
their expected income so that they can repay their debt and not go bankrupt.