Analysis of CloudFactory on the basis

of their Human Resource Management

Strategy and Leadership Strategy
Presented by:
Nikhil Shrestha
Introduction
• Mark Sears is the founder of CloudFactory who visioned a path to connect thousands of workers in Nepal to
provide online basic work that would help the workers to establish in the marketplace and which will also
enable the country to bring in the capital to the economy.
• In 2010, the company was created with the name “icanarmy” which was later converted into the name as
“CloudFactory” with the aim to provide a platform for the young as well as talented individuals to learn, earn
and develop their talent to new heights to emerge as worthy leaders.
• CloudFactory provide the link between people and technology.
• The main tasked handled by CloudFactory is data labeling.
Mission Values
• CloudFactory believes that leadership is a mixture of character and competency.
• CloudFactory has an aim to raise each individual cloud worker as a leader in the community.
• The CloudFactory ensures that the employees learn a variety of skills by assigning the workers with variety
of tasks which will help the worker with strong backbone for being successful in the global economy.
• CloudFactory also has a core part in community service. By doing community services, the worker will be
provided with important in hand experience with the leadership skills and also make the work at
CloudFactory purposeful.
Scope of the study
• The scope of this proposal is to learn about leadership strategies and human resource management strategies
along with the critical analysis of the theories related to leadership and human resource management
respectively which can be related to the working environment of the CloudFactory.

Sources and Methods

• The details about the CloudFactory in the area of human resource management and leadership was found with
the help of an interview from my colleague who is currently employed with the CloudFactory. A number of
questions were prepared beforehand to be questioned which are listed in the appendix. The meeting was
conducted with the help of Zoom.
Purpose of the study
•This study investigates:
 How the company manages organizational goals.
 The type of leadership strategy implied in the organization.
 Proper management of the workers- training, retention, team integration.
 Workforce empowerment for the workers.
 How the workers are motivated
 Type of leadership the company applies
Finding in Human Resource Management
Strategies
• Motivation-
• Motivation refers to the satisfaction of the employees to do work.
• According to Hierarchy of needs (Maslow, 1943), the basic needs must be satisfied before the higher-level
needs which would highly motivate the employee.
• Expectation theory (Vroom, 1964) states that employee’s hardwork is directly proportional to performance
and high performance will eventually lead to rewards which is an important factor for motivation.
• CloudFactory provides the employees with good competitive working environment, bonuses, optimal wages,
basic necessities and other facilities which motivates the employees to work at their full potential.
• Recruitment
• The company is mostly involved in data labeling for the artificial intelligent powered software, the labor
force is quite demanding.
• According to the negligent hiring theory stated (North, 1976), the company should know the details and do
background checks before recruiting them.
• The recruitment process has a number of tests which the employee has to pass in order to get recruited.
• The workers are paid according to the difficulty of the data labeling.
• All the works are done in the cloud online and the employees can finish their task in their flexible time. All
works are assigned via email.
• Training and Development
• Training and development are a vital part in human resource management as it helps the employees to
improve their skills which will help in improving employee’s performance (Guest, 1997).
• According to AMO(Ability, motivation, opportunity) theory (Appelbaum et al., 2000), human resource
management works by enhancing the employee’s abilities, motivation and opportunity which will later bring
profits to the company.
• The newly hired employees are subjected to training for about 1-3 months.
• The study material is available to all the employees affiliated with the organization in order to improve their
skills.
• Benefits and compensation
• According to the behavior reinforcement theory (Gordan, 2014), if an employee is rewarded for an
exceptional work and performance, the employee will be highly motivated and keep giving the best of their
abilities.
• The CloudFactory makes sure that the benefits and compensation which are being provided to the employees
are fairly relevant with accordance to the government policy.

• Retention
• According to the Human capital theory (Wuttaphan, 2017), employees are considered to be an asset for the
organization.
• It is really important for the company to make the highly skilled employees motivated to work in the
organization as they are the workforce for earning profits for the organization.
• The wages of an employees are increased by viewing their work performance, quality work provided and
contribution towards the company.
Finding on Leadership Strategy
• Leadership Style
• CloudFactory implies a combination of various leadership style- participative, Laissez-Faire and Coaching.
• Anderson (1959) states that democratic leader is one who motivates the employee to be a part in decision
making and participative leadership is associated with highly improved morale.
• Laisse-Faire leadership refers to the leaders where they let their employees make use of their experience,
creativity and resources to help them reach their goals (Western Governor University, 2020).
• Coaching leadership refers to the leaders who want their employees to develop long-term personal strengths
(Berg and Karlsen, 2016).
• Nature of Leadership
• The nature of leadership that CloudFactory emphasizes is flat organization structure which means that there is
little management level between the leaders and employees.
• This structure makes sure that the employees have high involvement in the decision-making process with
minimal supervision.

• Vision
• CloudFactory has a vision to employee thousands of workers to provide online data labeling and mold them
into future leaders to serve the community.
• CloudFactory main focuses on the character, competency and community service.
• CloudFactory uses style theory which emphasizes that good leaders are not born successful but the leaders
can be molded into a successful one via learnable behavior of the leader (Western Governor University,
2020).
 Delegate and empower-
• CloudFactory makes sure to engage their employees by empowering them by delegating greater
responsibilities.
• This ensures that the employees are trusted with the responsibility and makes the employee feel a sense of
self-worth which encourages the employee to grow as a leader.

• Training
• The CloudFactory provides free courses to the employees in order to increase their leadership skills.
• This will further help the employee to take the next step in transforming into a great leader by having the
proper knowledges and strategies to function as a leader.
Critical Analysis on HRM Strategy
• Motivation
• Maslow’s hierarchy of need is simple to understand and takes humans into account.
• For some people, respect is more important than safety or money.
• Vroom’s expectation theory assumes that all the employees will provide their 100 % effort which is not
always the case.

• Recruitment
• The negligent hiring theory stated that the company should know the details and do background checks
before recruiting them.
• The information given in the curriculum vitae might be true to some extent but to verify the information, all
the legal documents must also be tested.
• The only mode of communication for the employees is email which is not at all efficient if the employees
don’t have a habit to look into their emails daily.
• Training and Development
• AMO theory states that the organization can profit by enhancing ability, motivation and opportunity to the
employees. But this theory can only be successful if the employees are loyal to the organization.
• If there is no improvement in the wages even though the employee is exceptional in all the three fields, the
training given to the employee for a purpose becomes wasted.

• Benefits and compensation

• Even though the rewarding system is an excellent choice for the motivation of the employees, sometimes
appreciation, praise might have a bigger value for an employee rather than receiving rewards which
contradicts the behaviour reinforcement theory.

• Retention
• It means to retain the employee by showing the benefits to the employee will receive in the days to come if
the employee stays loyal.
• But sometimes when an employee performs exceptionally well, the employee is bombarded with too much of
responsibilities
Critical Analysis on Leadership Strategy
• Leadership Style
• Democratic style may lead to agreement and disagreement for a particular idea leading to a communication
gap.
• Laissez-Faire style gives full freedom to the employees to take their own decision but if the employee is not
capable to handle the task on their own, the chances of getting unwanted results will drastically increase.
• Coaching style requires an expert mentor who can polish an employee’s skill but if the mentor is not an
expert in his field, then the mentoring can have an negative effect.

• Nature of leadership
• CloudFactory uses flat organization but this approach can cause problem if the ratio of the employee to the
manager is out of proportion.
• Vision
• The style theory states that good leaders are not born successful but the leader can be modeled into a
successful one via learning behaviour. But the time period for an individual to develop into a leader may vary
from person-to-person.

• Delegate and empower

• It is acceptable to delegate power to provide motivation but the delegation should happen in such a way that
employee does not misuse or overuse the authority which may harass other employees.

• Training
• It is a good method to train the employees to mold them into future leaders for the community. This helps in
improving the skills of the employees as well as they get information about various topics of the economy.
Conclusion
1. CloudFactory provides the employees with good competitive working environment, bonuses, optimal
wages, basic necessities and other facilities which motivates the employees to work at their full potential.
2. CloudFactory does a background check on the employees before recruiting and the recruitment process is a
lengthy in order to get selected.
3. CloudFactory provides employees with training facilities and study material in order to improve their skills.
4. The employees are paid in the hourly basis according to the difficulty of the task.
5. Exceptional employees are subjected to promotion and the wages of the employee is increased by reviewing
the performance of the employee.
6. CloudFactory uses flat organization structure with a mixture of 3 leadership style- participative, Laissez-
Faire and Coaching styles.
7. CloudFactory believes to mold employees into future leaders who will be able to serve the community.
8. CloudFactory improves the morale of employees by delegating the power to the employees which helps in
becoming a leader.
SWOT Analysis
PEST Analysis
Recommendation
1. Even though the work to be done is data labeling which is done online, the company should make sure to
organize activities together once a month which will further help the company to observe the behaviour of
the employees and will also help the team in working together efficiently.
2. The only mode of communication with the employees is email. The CloudFactory should figure out way to
interact with the employees by creating groups in social media where most of the employees spend their free
time.
3. The hierarchy should be defined well in order for the organization to function properly.
References
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