The Challenge of Human Resource Management

Managing Human Resources

Why Study Human Resources Management

Human Resources Management (HRM)
The process of managing human resources (human capital and intellectual assets) to achieve an organizations objectives.

Why Study HRM?

Staffing the organization, designing jobs and teams, developing skillful employees, identifying approaches for improving their performance, and rewarding employee successesall typically labeled HRM issuesare as relevant to line managers as they are to managers in the HR department.

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Competitive Advantage through People

Core Competencies
Integrated knowledge sets within an organization that distinguish it from its competitors and deliver value to customers.

Sustained competitive advantage through people is achieved if these human resources:

Have value. Are rare and unavailable to competitors. Are difficult to imitate. Are organized for synergy.

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Competitive Challenges and Human Resources Management

The most pressing competitive issues facing firms:
1. Going global 2. Embracing new technology

3. Managing change 4. Managing talent, or human capital

5. Responding to the market 6. Containing costs

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Challenge 1: Going Global

Globalization
The trend toward opening up foreign markets to international trade and investment

Impact of globalization
Anything, anywhere, anytime markets Partnerships with foreign firms Lower trade and tariff barriers

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Challenge 1: Going Global (contd)

Corporate Social Responsibility
The responsibility of the firm to act in the best interests of the people and communities affected by its activities

Impact on HRM
Different geographies, cultures, laws, and business practices

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Challenge 2: Embracing New Technology

Knowledge Workers
Workers whose responsibilities extend beyond the physical execution of work to include planning, decision making, and problem solving. Influence of Technology in HRM

Human Resources Information System (HRIS)

A computerized system that provides current and accurate data for the purposes of control and decision making.

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Challenge 3: Managing Change

Types of Change
Reactive change

Change that occurs after external forces have already affected performance
Change initiated to take advantage of targeted opportunities

Proactive change

Managing Change through HR

Formal change management programs help to keep employees focused on the success of the business.

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Challenge 3: Managing Change (contd)

Why Change Efforts Fail:
1. 2. 3. 4. 5. 6. Not establishing a sense of urgency. Not creating a powerful coalition to guide the effort. Lacking leaders who have a vision. Lacking leaders who communicate the vision. Not removing obstacles to the new vision. Not systematically planning for and creating shortterm wins. 7. Declaring victory too soon. 8. Not anchoring changes in the corporate culture.

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Challenge 4: Managing Talent, or Human Capital

Human Capital
The knowledge, skills, and capabilities of individuals that have economic value to an organization.

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Challenge 5: Responding to the Market

Total Quality Management (TQM)
A set of principles and practices whose core ideas include understanding customer needs, doing things right the first time, and striving for continuous improvement.

Six Sigma
A process used to translate customer needs into a set of optimal tasks that are performed in concert with one another.

Reengineering and HRM

Fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in cost, quality, service, and speed.

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Challenge 6: Containing Costs

Downsizing
The planned elimination of jobs (head count). Layoffs

Outsourcing
Contracting outside the organization to have work done that formerly was done by internal employees.

Offshoring
The business practice of sending jobs to other countries.

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Challenge 6: Containing Costs (contd)

Employee Leasing
The process of dismissing employees who are then hired by a leasing company (which handles all HRrelated activities) and contracting with that company to lease back the employees.

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Challenge 6: Containing Costs (contd)

Hidden Costs of Layoff
Severance and rehiring costs

Accrued vacation and sick day payouts Pension and benefit payoffs
Potential lawsuits Loss of institutional memory and trust in management Lack of staffers when the economy rebounds

Survivors who are risk-averse, paranoid, and political

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Challenge 6: Containing Costs (contd)

Benefits of a No-Layoff Policy
A fiercely loyal, more productive workforce Higher customer satisfaction Readiness to snap back with the economy A recruiting edge Workers who arent afraid to innovate, knowing their jobs are safe.

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Cultural Changes

Employee Rights

Concern for Privacy

Cultural Changes

Balancing Work and Family

Attitudes towards Work

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Qualities of Human Resources Managers

Responsibilities
1. Advice and counsel

Competencies
1. Business mastery

2. Service 3. Policy formulation and implementation

4. Employee advocacy

2. HR mastery 3. Change mastery

4. Personal credibility 5. Be HUMAN!!

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