The role of Human Resource Management Practitioner
The most fundamental role of human resource management is to devise and ensure management strategies so as to fully maximise organisation’s human capital and minimise financial risk. Human resource practitioners strive to achieve this basic objective through the induction of skilled and capable individuals into the workforce. In this paper, I shall critically evaluate and analyse the external factors that influence the approach of management in organisations and the role of human resource management amid ever-changing nature of employment.
It is important for the human resource practitioners to consider all the external factors affecting their practices in order to deal with the challenges effectively. External factors in terms of human resource management may be defined as the issues which are beyond the control of the organisation. They may include issues such as economic downturn, present and future labour market trends such as education level, government investment into industries and skills. These factors require deeper analysis and consideration for they have a direct effect on the resourcing, motivation level, development, and retention of the employees. Briefly put, the most important external factors are: society culture, economic system, work market and institutional conditions.
The emergence of globalization and challenges of HRM
The rise of globalization has posed human resource development with unprecedented challenges and risks. The fact that organisations are now venturing beyond territorial boundaries has brought with it its own distinctive complexities. Multinational companies now require employees who may adapt themselves to different cultures and work environments. Managing corporate culture is not simple. It requires constant assessments and monitoring by examining the external and internal environment. Such examination would reveal the nature of changes that are anticipated or are taking place in these environments. These changes may force the organisation to adapt or modify their corporate culture according to the demands of the environment. A relaxed attitude on the part of the managers who believe they have a strong culture built over the years to enable them to cope with any kind of situation is risky. Uttal asserts that a static culture means a continuation of old, inefficient ways (Uttal, 1982).
Globalization is the process of expanding global preferences in cultural, environmental, political, social and economical issues. The key economic characteristic of globalization is the free movement of goods throughout the world (Schaeffer, 2003). It is necessary for anyone and everyone to think global in doing business in this global village. Diversity and Globalization in the new economy and the present business situation has produced a work force made up of people all around the world. They have different life experiences, perspectives, preferences, values and style. This diversity of work force is reshaping and rewriting the way of doing business.
Hamilton said that, “The great challenge facing the nation is to prepare a changing population to do new kinds of work. Failure imperils economic health, social progress, and democracy itself. (Hamilton, 1990, p.1).
Changing nature of employment
Given the technological revolution, the nature of workplace and work has changed significantly. For example, there has been a palpable transition from secure and long-term employment to outsourcing and short-term contract jobs. In the Quality of Working Life Survey (Worral and Cooper, 2006), 66 percent of the 10,000 managers surveyed said that the major restructurings of the recent years had added significantly to their job insecurity because employees still seem to prefer permanent jobs.
Moreover, the idea of outsourcing has also brought about significant changes in the process of human resource management. It has raised the concerns of employees who now feel even more insecure. Third world countries such as India, Malaysia have turned out to be the major stakeholders of business outsourcing. It undermines the morale and productivity of the local employees based in UK and other first world countries.
Demography, labour market trends, employee relations and workforce diversity
Today, the demographic factor stands out as an issue that concerns the HR professionals. Its effects on the labour market and nature of employment has changed HR practices altogether. According to Schramm(2004) “the majority of the HR professionals surveyed said that to address demographic changes, and particularly a potential skills shortage, their companies have been investing more in training and development, and putting more emphasis on succession planning. Many companies are even bringing retirees back into the workforce and are training line managers to recognize and respond to generational differences.”(HR magazine, 2004) Demography refers to the characteristics of a population or workforce and its location. It may include age, gender social class. The demographic factor may leave a strong effect on pension offerings, employee benefits and other facilities.
In such a situation, it is important for the HR managers to deeply examine and even question their own ideas about the trends and the foreseeable future of work. They must come up with strategic planning to ascertain as to what future holds in store for them and their organisations. They must also act flexibly to deal with any unexpected situation arising out of demographic changes and ever-changing labour market trends. Similarly, The Future of Work Programme (2005) suggests that the more participative and employee-friendly workplaces as predicted decade ago are slow to be realised in UK.(Holbeche,2003,45)
The labour market trends also play a pivotal part in the effectiveness of human resource management and policies. Labour market may be referred to as a force that constitutes the relationship between workers and work organisations. It is incumbent on the HR practitioners to ensure that they keep the right people on board with right skills and attributes.
Diversity in workforce refers to differences with regard to population and workplace. In the wake of globalization, organisations have tended to be rather culturally diverse and their working patterns flexible enough to deal with the societal and global changes taking place every now and then. Employer always has to be cautious enough in dealing with theissues that directly concern employees or affect them negatively such as racial discrimination, sexual harassment. Anti-discrimination legislation over three decades has served as a cornerstone to increasing diversity at work infusing repect and value for other cultures. With the industries making a transition from manual to managerial nature of working conditions the need for more skilled labour has increased. In case of scarcity of skilled labour, employer is compelled to offer more monetary rewards and other benefits.
For example, if there is communication gap between a culturally diverse team then there is a chance that a homogenous group may outperform this culturally diverse group. Multicultural organizations require extensive trainings to overcome the communication barrier otherwise it will not perform up to their potential (Perkins, 1993).
Every company has its own individuality in the market; this individuality or the isolated quality can be taken as its competitive advantage. Competitive advantage of the company is something on what company is far ahead from its competitors.
For example, the Chinese branch of the company, having a diverse workforce, is bound to have its impact on the effectiveness of the organisation as well as on the career growth of an individual. One of the most important advantages of having a multicultural or diverse workforce is to attract the best available talent towards the organisation. Such organisation, which does not show any prejudice in recruiting, retaining and promoting the employees from diverse cultural and racial backgrounds easily gain competitive advantage and become able to sustain highest caliber of human resources (Adler, 1991). Thus we can say that Chinese branch of the company, with an effectively managed and well organized diverse workforce, will be considered to have much better understanding of foreign cultures and employees.
Different studies have proved that organisations having diverse workforce and multicultural environment usually display better problem solving ability (Adler, 1991). Due to their multicultural workforce such organisations are more capable to understand the problem with different perspectives, meanings and interpretations and hence have more capability to solve problems.
Organisations need continuity, which can be achieved only through some change of adaptability and self-renewal. Multicultural organisations are designed specifically to find, accept, and use new ideas and so they are more able to adapt change and show more organisational flexibility. Different studies depicted that women possess higher tolerance for ambiguity than men (Rotter & O’Connell, 1982), similarly bilingual people possess more cognitive flexibility than monolingual (Lambert, 1977). Thus diverse workforce is an asset for the organisations while adapting change.
It can easily be summed up that having a diverse workforce and its proper management provides a number of advantages to the organisations. “Manage diversity well are more likely to gain competitive advantages, attain increased productivity from available human resources, and reduce the inter-group conflict cost” (Triandis, Kurowski, and Gelfand 1994, p. 775).
But at the same time, too much diversity in the workforce may also cause ambiguity and confusion. Multicultural organisations sometimes find it difficult to reach to a single, unanimous decision because of the diversity in its workforce.
Due to the presence of people from different cultural backgrounds, there is a chance of cultural clashes between the people of different cultures. There is also a chance that majority group members may create obstacles for minority group member to take full participation. If such clashes cannot be handled and managed by the leaders then the organisation may suffer ineffectiveness, less productivity and absenteeism of the employees (Adler, 1991).
If there is communication gap between a culturally diverse team then there is a chance that a homogenous group may outperform this culturally diverse group. Multicultural organisations require extensive trainings to overcome the communication barrier otherwise it will not perform up to their potential (Perkins, 1993).
Theoretical Frameworks and Functions of HRM
The basic function of Human Resource Management (HRM) involves various activities such as deciding what kind of staffing is required and whether employees will be hired through independent contractors. They decide whether internal recruitment or external method would be beneficial to the growth and development of their organisation. It is also their function to manage their approach to employee benefits, compensation, rewards for high performers and personal policies.
It is pertinent to note that the function of HRM and profession of HRD have faced dramatic changes over two decades. Now HR practitioners are expected to carry out broader range of activities within the framework of HRM and HRD such as career development, training programmes and personal and organisational development. HR practitioners provide guidance to management. At the highest level, this will include recommendations on HR strategies that have been developed by processes of analysis and diagnosis to address strategic issues arising from business needs and human, organisational or environmental factors. At all levels, guidance may be provided on HR policies and procedures and the implications of employment legislation. In the latter area, HR practitioners are concerned with compliance - ensuring that legal requirements are met.
Guidance will also be provided to managers to ensure that consistent decisions are made on such matters as performance ratings, pay increases and disciplinary actions.
HR practitioners provide advice on such matters like job design, advertising for staff, drawing up short-lists for selection, identifying methods for satisfying training needs, the rates of pay to be offered to employees on recruitment promotion, health and safety requirements, employee relations issues disputes, grievances and communications and handling people problems such as discipline, capability, absenteeism. HR has a key role to play in proactively providing advice and the HR support mechanisms to underpin the joint objective.(Holbeche,
In the face of changing nature of employment and influences of demographic and labour market trends, the role of HR practitioners cannot be reduced to mere administrative responsibilities but it has rather become indispensible that they work as an important group within the organisation to meet the abovementioned challenges. The function of HR practitioners is to create practices aptly consistent and intact in different locations and cultures while also keeping various cultures and practices unaffected.
What we can draw from the abovementioned framework is as follows:
· The reluctance to see HR practice as an important strategic tool for the growth of company still exists.
· The blend of HR professional competence and knowledge of the business is necessary to contribute effectively to the development of organisation.
· Managerial competencies are closely intertwined with the organisational performance.
· The productivity level of a firm is determined by HRM practices.
· The relationship between HRM and company’s performance is always likely to be affected by the organisational variables such as firm size, prevailing market trends, and technology and employee relations.
It is important to note that these propositions derived from the framework of HRM give us an insight into the challenges that HRM faces today.
The role of HR Practitioners as Strategists
As being strategists, HR practitioners address major long-term issues concerning the management and development of people and the employment relationship. They are motivated and driven by the business plans of the organisation but they also contribute to the formulation of the business plans. This is achieved by ensuring that top managers focus on the human resource implications of their plans. HR strategists convince high level managers that they must devise plans that make the best use of the core competences of the organisation’s human resources. They emphasize the importance of workforce as in the words of Hendry and Pettigrew (1986), that people are a strategic resource for the achievement of competitive advantage.(Kirkbride, 1994, 59) A strategic approach to managing people means that HR strategists strive to achieve strategic integration. Integration means that strategies are linked together to form a coherent whole. Vertical integration takes place when HR strategies are linked to and support business strategies. Horizontal integration is achieved when a range of coherently interconnected and mutually reinforcing HR strategies are established. Strategic fit means that both the business and HR strategies meet the particular needs and circumstances of the organisation.
The human resource managers also become the strategic partners of the organisation when they participate in the process of defining business strategy, move strategy into actions by asking questions and by designing such human resource practices which align and integrate with the business strategy of the organisation.
Karen Legge’s model of HRM
Karen Legge came up with two models of human resource managers. According to him, the first type of managers is conformist innovators who go well with their organisation’s ends and adjust their means to achieve them. (Legge, 2004) This type of managers uses their professional expertise as means to ameliorate and improve the performance of their departments.
The second type of the mangers is deviant innovators who seek to change the means/ends relationship by gaining acceptance for a different set of criteria for the evaluation of organisational success and their contribution to it.
How can HRM rise above the negative influences of external factors?
The human resource manager has to devise effective long-term policies to inculcate the sense of security and satisfaction among the existing and potential employees in order to fend off the negative influence of external forces such as demography, market trends, etc. Different ways to deal with such problems are stated below:
- Selecting the right people: as with any position, sound selection for any kind of job is essential. The human resource manager has to keep in mind that some Americans abroad have damaged both their company’s and their country’s image by conveying an attitude of cultural arrogance, which results when a person conveys the attitude that his or her own culture is superior to another’s. Some employees do not function well in a foreign environment. According to a research project by Pierre Haldemann, only the financial benefits are not a sufficient motivator for employees to take part in the international assignments. According to this research challenge is the best motivator ,for 30.8% of the responders while 26.95% thought that the adventure of trying something new and different is most appealing. Only 3.85% of the respondents thought that monetary benefits are important for motivating them for international assignment (Haldemann, 1999). In the study conducted by Haldemann in which 26 expatriates were interviewed, it was concluded that 46.15% of the expatriates were selected for their technical knowledge and merit, 15.4% were selected for being the most suitable person for the job, 11.5% were selected for having the capability to adapt, 7.7% were selected for having the ability to speak the language of the host country, 3.8% were selected for their managerial abilities, 3.8% were selected for their interpersonal skills and 19.25 were selected without any specific selection criteria. The best approach for Human resource Manager is to select the right people who should, of course, be competent in their specialty. In addition, people should be selected on the basis of their desire to work and live with company at home and abroad. It is more appropriate, that employees who have already traveled or lived in other countries or have some understanding about the other culture should be selected to work in the international working conditions
- Allowing Orientation Visits: In case of multi-national organisation, an employee’s adjustment or relocation to other country can be facilitated and apprehensions reduced if he or she can make one or more orientation visits to other countries before actually assuming job responsibilities.
· Spouse and Family Satisfaction: It has been noticed that the satisfaction and adjustment of the spouse and other family members of the employees plays an important role in the success or failure of an employee. In a study, which was conducted by Mohr and Klein it has been found out that only 36% of the spouses feel that the level of adjustment into the host country helps to satisfy them (Mohr & Klein, 2002). Thus the human resource manager of the organisation has to provide proper orientation to the employees to the satisfaction of their family. Working conditions should not affect their family life at all costs.
- Providing Training Opportunities: Training for employees selected to assume job responsibilities is essential. In case of multi-national company, they may be relocated to other places for training and exposure to other cultures. But unfortunately, according to a study conducted by Brewster and Pickard, “The research that has been done shows, primarily, that little preparation takes place. Despite the importance of expatriate positions, the high costs associated with expatriation and the extensive and largely nonproductive "running-in" periods, it is still the case that most organisations provide no formal training for expatriation” (Brewster and Pickard, 1994). According to the researchers, “Key elements include the nature of the international operation, the relevant job, the extent of interaction with locals, motivation, the family, and language skills. One implication of these approaches is that formal courses may be just one way of meeting the need for preparation, and that other means, such as preparatory visits, informal briefings, shadowing, and overlaps may be more cost effective“(Bonache, Brewster and Suutari, 2001). It is more appropriate for human resource managers to involve employee’s spouses in certain aspects of training programmes that allow for easier adjustment.
· Creating the Right rewards: In all competitive and good organisations, a normal employee of the company usually gets a package including basic salary, health insurance for employees and their families and employer pension contributions. But it is always better to offer some extra. The organisation can provide a number of rewards from which employees can choose which is most suitable for them. It is also appropriate to offer their shares to their most talented workers. The offering of shares may align the interests of the company and the employees by allocating the right to purchase equity, usually at a discount, at a set date in future.
· Creating Work- Life balance: The people working in a professional environment have some family responsibility as well and the work-life balance is their major priority. One of the most important strategies to get best out of an employee and to retain him/her is centered on helping him to reduce work-life stress because the statistics have shown that over seventy one percent of the employees of present business world cited its family-friendly programs as one of the main reasons they stay with the company.
· Managing Diversity: the increasing diversity of people within organization is reflected in several ways. Managers must learn to motivate and lead different types of people and to attract the best people from these groups
· Flexibility: speed and flexibility are the dominant competitive issues in human resource development and management. The company will have to respond to the needs and preferences of their employees the preferences of the employees.
Effects of Culture on Management Policies
Most of the scholars agreed that the field of management must be viewed in a broad perspective because of the environmental influence on management practices. The cross-cultural study of management involves the study of management cultural variables, which tend to have an impact on management practices in different cultures. Managing and organizing are culturally dependent because they do not consist of making or moving tangible objectives, but of manipulating symbols, which have meaning to the people who are managed.
The internal environment within which managers work includes corporate culture, production technology, organisation structure, and physical facilities. Of these, corporate culture has surfaced as extremely important to competitive advantage. The internal culture must fit the needs of the external environment and company strategy. When this happens, highly committed employees create a high-performance organisation that is tough to beat (Wiener, 1988).
According to Davis, in every company there is a company way of doing things, which has a powerful influence on the way people behave inside the firm. This is the corporate culture and it has a major impact on a company's ability to carry out its objectives and its plans, and that is especially true when the corporation is making an important shift in its strategies (Davis, 1984). It has been said that the climate of an organisation is, “psychological environments in which behavior of individuals occur” (Ott, 1998). Culture can be defined as the set of key values, beliefs, understandings, and norms shared by members of an organisation (Kilmann, Saxton, Serpa, 1986). Culture represents the unwritten, informal norms that bind organisation members together. Culture can be analyzed at visible and invisible levels (Schein, 1984).
The Human Resource manager has to play a very important role in the organisation. He often has to play the role of a consultant in the organisation. The human resource manager can provide the advice to the other executives of the organisation to tackle the persons who are working under their supervision. This is where the Human Resource manager performs the duties of a consultant. As an executive he has to make sure that the routine activities of his area are running smoothly.
The world is shrinking rapidly with the advent of faster communication, transportation, and financial flows. Products developed in one country are finding enthusiastic acceptance in other countries. The domains of business now cover the entire planet, where stock markets, fax machines, Internet, Televisions intermingle across national boundaries. The world of commerce is becoming wired like an integrated circuit, with no nation left out of the loop.
Over the next few years, new forces are going to shape managerial careers. Managers will have to rely heavily on human skills and conceptual skills, but they will apply them in new ways. The HR practitioners must keep in mind that problems will always increase hence they must know how to deal with them.
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