Description
The report explains on how HRM function is changing and competitive challenges for HRM function.
Why Study Human Resources Management
• Human Resources Management (HRM)
The process of managing human resources (human capital and intellectual assets) to achieve an organization’s objectives.
Human Resources Management for Line Managers
• “Why Study HRM?”
Staffing the organization, designing jobs and teams, developing skillful employees, identifying approaches for improving their performance, and rewarding employee successes—all typically labeled HRM issues—are as relevant to line managers as they are to managers in the HR department.
Responsibilities of HR Departments
• • • • • • Employment and recruiting Training and development Compensation Benefits Employee Services Employee and community relations • Personnel records • Health and safety • Strategic planning
What Roles Do HR Departments Perform?
Strategic Partner
Administrative Expert
Human Resources
Employee Advocate
Change Agent
How is the HRM Function Changing?
• The amount of time that the HRM function devotes to administrative tasks is decreasing and its roles as a strategic business partner, change agent, and employee advocate are increasing • In shifting the focus from current operations to strategies for the future and preparing non-HR managers to develop and implement HR practices, HR managers face two important challenges:
7
Line Manager’s HRM Jobs
• • • • • • The right person Orientation Training Performance Creativity Working relationships
• • • • •
Policies and procedures Labor costs Development Morale Protecting
Self-service refers to giving employees online access to information about HR issues Outsourcing refers to the practice of having another company provide services
Competitive Advantage through People
• Core Competencies
Integrated knowledge sets within an organization that distinguish it from its competitors and deliver value to customers.
Overall Framework for Human Resource Management
• 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.
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
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
NAFTA, EU, APEC trade agreements WTO and GATT
Challenge 1: Going Global (cont’d)
• Corporate Social Responsibility
The responsibility of the firm to act in the best interests of the people and communities affected by its activities
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.
• Impact on HRM
Different geographies, cultures, laws, and business practices Issues:
Identifying capable managers and workers Developing foreign culture and work practice training programs. Adjusting compensation plans for overseas work
• Knowledge-Based Training
Online instruction “Just-in-time” learning via the Internet on company intranets
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. Benefits:
Store and retrieve of large quantities of data. Combine and reconfigure data to create new information. Institutionalization of organizational knowledge. Easier communications. Lower administrative costs, increased productivity and response times.
Challenge 3: Managing Change
• Types of Change
Reactive change
Change that occurs after external forces have already affected performance
Proactive change
Change initiated to take advantage of targeted opportunities
• Managing Change through HR
Formal change management programs help to keep employees focused on the success of the business.
Challenge 3: Managing Change (cont’d)
• 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.
Challenge 4: Managing Talent, or Human Capital
• Human Capital
The knowledge, skills, and capabilities of individuals that have economic value to an organization. Valuable because capital:
is based on company-specific skills. is gained through long-term experience. can be expanded through development.
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.
Challenge 5: Responding to the Market (cont’d)
• Reengineering and HRM
Fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in cost, quality, service, and speed.
Requires that managers create an environment for change. Depends on effective leadership and communication processes. Requires that administrative systems be reviewed and modified.
• Six Sigma
A process used to translate customer needs into a set of optimal tasks that are performed in concert with one another.
Challenge 6: Containing Costs
• Downsizing
The planned elimination of jobs (“head count”). Layoffs
Challenge 6: Containing Costs (cont’d)
• Hidden Costs of Layoff
Severance and rehiring costs Accrued vacation and sick day payouts Pension and benefit payoffs Potential lawsuits from aggrieved workers Loss of institutional memory and trust in management Lack of staffers when the economy rebounds Survivors who are risk-averse, paranoid, and political
• 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.
Challenge 6: Containing Costs (cont’d)
• 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 aren’t afraid to innovate, knowing their jobs are safe.
Highlights in HRM 5
Source: Survey data from Gail Robinson and Kathleen Dechant, “Building a Business Case for Diversity,” Academy of Copyright Executive 11, no. 3 (August 1997): 21–31; permission conveyed through the Copyright Clearance Center, Inc. Management© 2007 Thomson South-Western. All rights reserved.
1–22
Cultural Changes
Qualities of Human Resources Managers
• Responsibilities • Competencies
1. Business mastery 2. HR mastery 3. Change mastery 4. Personal credibility 1. Advice and counsel 2. Service 3. Policy formulation and implementation 4. Employee advocacy
Employee Employee Rights Rights
Concern for Concern for Privacy Privacy
Cultural Cultural Changes Changes
Balancing Work Balancing Work and Family and Family Attitudes Attitudes towards Work towards Work
1–23
Copyright © 2007 Thomson South-Western. All rights reserved.
1–24
Human Resource Competency Model
HR’s evolving role
Protector and Screener
Change Agent
Strategic Partner
Source: Arthur Yeung, Wayne Brockbank, and Dave Ulrich, “Lower Cost, Higher Value: Human Resource Function in Transformation.” Reprinted with permission from Human Resource Planning, Vol. 17, No. 3 (1994). Copyright 1994 by The Human Resource Planning Society, 317 Madison Avenue, Suite 1509, New York, NY Copyright © 2007 Thomson South-Western. All rights reserved. 1–25 10017, Phone: (212) 490-6387, Fax: (212) 682-6851.
Strategic HRM
De fin it i on
Strategic Planning and Trends
• Strategy is the company’s long-term plan for how it will balance its internal strengths and weaknesses with its external opportunities and threats to maintain a competitive advantage.
Strategic Planning 101
Strategic management Process Define the current Business Perform External and Internal Audits Formulate new business and mission statement Translate the mission in to goals Formulate strategies to achieve the strategic goals Implement the strategy Evaluate performance
There are three levels of strategic planning as shown below
Corporate Strategy
Business Strategy
Business Strategy
Business Strategy
Business Strategy
Functional Strategies
• Strategic Human Resources Management
The use of employees to gain or keep a competitive advantage, resulting in greater organizational effectiveness.
De fin iti on
Human Resources as a Core Competency
Strategic HRM
•
• Core Competencies
The unique capabilities of employees in an organization that create high value and that differentiate the organization from its competition The source of an organization’s sustainable competitive advantage.
Strategic human resource management: linking HRM with strategic goals and objectives to improve business performance and develop organizational cultures fostering innovation and flexibility.
Clarify the business strategy Realign the HR functions and key people practices Create needed competencies and behaviors Realization of business strategies and results Evaluate and refine
Linkage of Organizational and HR Strategies • Cost Leadership • Differentiation
Competition on the basis of low price and high quality of product or service Relies on “building” employees to fit specialized needs Requires a longer HR planning horizon approach Competition on the basis of either offering distinctively different products or services or establishing an exclusive image for quality products and services Relies on hiring needed skills. Needs a shorter planning time frame in order to be responsive to dynamic environments
Changing Roles of HR Management
Note: Example percentages are based on various surveys.
HR Management Roles
• Administrative Role
Clerical and administrative support operations (e.g., payroll and benefits work)
Technology is transforming how HR services are delivered. Outsourcing HR services to reduce HR staffing costs
Strategic Role for HR
• Strategic Role
“Contributing at the Table” to organizational results HR becomes a strategic business partner by:
Focusing on developing HR programs that enhance organizational performance. Involving HR in strategic planning at the onset. Participating in decision making on mergers, acquisitions, and downsizing. Redesigning organizations and work processes Accounting and documenting the financial results of HR activities.
• Operational and Employee Advocate Role
“Champion” for employee concerns
Employee crisis management Responding to employee complaints
Operational to Strategic Transformation of HR
Approaches to Improving Organizational Productivity
The Role of HR in Strategy Formulation
Administrative Linkage One-Way Linkage Two-Way Linkage Integrative Linkage
Strategy Formulation
External Analysis
- opportunities - threats
Strategic Planning
Strategic Planning
Strategic Planning
Mission
Strategic Planning - reason for being
Goals
- what it hopes to achieve
Strategic Choice
- ways to fulfill goals and mission
HR Function HR Function HR Function HR Function
Internal Analysis
- strengths - weaknesses
HR Input
How HR helps strategy execution
• Functional strategies should support competitive strategies • Value chain analysis • Outsourcing • Strategy Formulation
HR means performance
• Can HR have a measurable impact on a company’s bottom line? • Better HRM translates into improved employee attitudes and motivation (e.g., working at home) • Well run HR programs drive employee commitment
TOYOTA
Strategy Implementation
HR Practices - recruitment - training - performance management - labor relations - HR planning - job analysis - job design - selection - development - pay structure - incentives - benefits
Strategic Choice
HR Needs - skills - behaviors - culture
HR Capability - skills - abilities - knowledge
HR Actions - behaviors - results
Firm Performance - productivity - quality - profitability
doc_114465599.pdf
The report explains on how HRM function is changing and competitive challenges for HRM function.
Why Study Human Resources Management
• Human Resources Management (HRM)
The process of managing human resources (human capital and intellectual assets) to achieve an organization’s objectives.
Human Resources Management for Line Managers
• “Why Study HRM?”
Staffing the organization, designing jobs and teams, developing skillful employees, identifying approaches for improving their performance, and rewarding employee successes—all typically labeled HRM issues—are as relevant to line managers as they are to managers in the HR department.
Responsibilities of HR Departments
• • • • • • Employment and recruiting Training and development Compensation Benefits Employee Services Employee and community relations • Personnel records • Health and safety • Strategic planning
What Roles Do HR Departments Perform?
Strategic Partner
Administrative Expert
Human Resources
Employee Advocate
Change Agent
How is the HRM Function Changing?
• The amount of time that the HRM function devotes to administrative tasks is decreasing and its roles as a strategic business partner, change agent, and employee advocate are increasing • In shifting the focus from current operations to strategies for the future and preparing non-HR managers to develop and implement HR practices, HR managers face two important challenges:
7
Line Manager’s HRM Jobs
• • • • • • The right person Orientation Training Performance Creativity Working relationships
• • • • •
Policies and procedures Labor costs Development Morale Protecting
Self-service refers to giving employees online access to information about HR issues Outsourcing refers to the practice of having another company provide services
Competitive Advantage through People
• Core Competencies
Integrated knowledge sets within an organization that distinguish it from its competitors and deliver value to customers.
Overall Framework for Human Resource Management
• 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.
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
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
NAFTA, EU, APEC trade agreements WTO and GATT
Challenge 1: Going Global (cont’d)
• Corporate Social Responsibility
The responsibility of the firm to act in the best interests of the people and communities affected by its activities
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.
• Impact on HRM
Different geographies, cultures, laws, and business practices Issues:
Identifying capable managers and workers Developing foreign culture and work practice training programs. Adjusting compensation plans for overseas work
• Knowledge-Based Training
Online instruction “Just-in-time” learning via the Internet on company intranets
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. Benefits:
Store and retrieve of large quantities of data. Combine and reconfigure data to create new information. Institutionalization of organizational knowledge. Easier communications. Lower administrative costs, increased productivity and response times.
Challenge 3: Managing Change
• Types of Change
Reactive change
Change that occurs after external forces have already affected performance
Proactive change
Change initiated to take advantage of targeted opportunities
• Managing Change through HR
Formal change management programs help to keep employees focused on the success of the business.
Challenge 3: Managing Change (cont’d)
• 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.
Challenge 4: Managing Talent, or Human Capital
• Human Capital
The knowledge, skills, and capabilities of individuals that have economic value to an organization. Valuable because capital:
is based on company-specific skills. is gained through long-term experience. can be expanded through development.
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.
Challenge 5: Responding to the Market (cont’d)
• Reengineering and HRM
Fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in cost, quality, service, and speed.
Requires that managers create an environment for change. Depends on effective leadership and communication processes. Requires that administrative systems be reviewed and modified.
• Six Sigma
A process used to translate customer needs into a set of optimal tasks that are performed in concert with one another.
Challenge 6: Containing Costs
• Downsizing
The planned elimination of jobs (“head count”). Layoffs
Challenge 6: Containing Costs (cont’d)
• Hidden Costs of Layoff
Severance and rehiring costs Accrued vacation and sick day payouts Pension and benefit payoffs Potential lawsuits from aggrieved workers Loss of institutional memory and trust in management Lack of staffers when the economy rebounds Survivors who are risk-averse, paranoid, and political
• 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.
Challenge 6: Containing Costs (cont’d)
• 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 aren’t afraid to innovate, knowing their jobs are safe.
Highlights in HRM 5
Source: Survey data from Gail Robinson and Kathleen Dechant, “Building a Business Case for Diversity,” Academy of Copyright Executive 11, no. 3 (August 1997): 21–31; permission conveyed through the Copyright Clearance Center, Inc. Management© 2007 Thomson South-Western. All rights reserved.
1–22
Cultural Changes
Qualities of Human Resources Managers
• Responsibilities • Competencies
1. Business mastery 2. HR mastery 3. Change mastery 4. Personal credibility 1. Advice and counsel 2. Service 3. Policy formulation and implementation 4. Employee advocacy
Employee Employee Rights Rights
Concern for Concern for Privacy Privacy
Cultural Cultural Changes Changes
Balancing Work Balancing Work and Family and Family Attitudes Attitudes towards Work towards Work
1–23
Copyright © 2007 Thomson South-Western. All rights reserved.
1–24
Human Resource Competency Model
HR’s evolving role
Protector and Screener
Change Agent
Strategic Partner
Source: Arthur Yeung, Wayne Brockbank, and Dave Ulrich, “Lower Cost, Higher Value: Human Resource Function in Transformation.” Reprinted with permission from Human Resource Planning, Vol. 17, No. 3 (1994). Copyright 1994 by The Human Resource Planning Society, 317 Madison Avenue, Suite 1509, New York, NY Copyright © 2007 Thomson South-Western. All rights reserved. 1–25 10017, Phone: (212) 490-6387, Fax: (212) 682-6851.
Strategic HRM
De fin it i on
Strategic Planning and Trends
• Strategy is the company’s long-term plan for how it will balance its internal strengths and weaknesses with its external opportunities and threats to maintain a competitive advantage.
Strategic Planning 101
Strategic management Process Define the current Business Perform External and Internal Audits Formulate new business and mission statement Translate the mission in to goals Formulate strategies to achieve the strategic goals Implement the strategy Evaluate performance
There are three levels of strategic planning as shown below
Corporate Strategy
Business Strategy
Business Strategy
Business Strategy
Business Strategy
Functional Strategies
• Strategic Human Resources Management
The use of employees to gain or keep a competitive advantage, resulting in greater organizational effectiveness.
De fin iti on
Human Resources as a Core Competency
Strategic HRM
•
• Core Competencies
The unique capabilities of employees in an organization that create high value and that differentiate the organization from its competition The source of an organization’s sustainable competitive advantage.
Strategic human resource management: linking HRM with strategic goals and objectives to improve business performance and develop organizational cultures fostering innovation and flexibility.
Clarify the business strategy Realign the HR functions and key people practices Create needed competencies and behaviors Realization of business strategies and results Evaluate and refine
Linkage of Organizational and HR Strategies • Cost Leadership • Differentiation
Competition on the basis of low price and high quality of product or service Relies on “building” employees to fit specialized needs Requires a longer HR planning horizon approach Competition on the basis of either offering distinctively different products or services or establishing an exclusive image for quality products and services Relies on hiring needed skills. Needs a shorter planning time frame in order to be responsive to dynamic environments
Changing Roles of HR Management
Note: Example percentages are based on various surveys.
HR Management Roles
• Administrative Role
Clerical and administrative support operations (e.g., payroll and benefits work)
Technology is transforming how HR services are delivered. Outsourcing HR services to reduce HR staffing costs
Strategic Role for HR
• Strategic Role
“Contributing at the Table” to organizational results HR becomes a strategic business partner by:
Focusing on developing HR programs that enhance organizational performance. Involving HR in strategic planning at the onset. Participating in decision making on mergers, acquisitions, and downsizing. Redesigning organizations and work processes Accounting and documenting the financial results of HR activities.
• Operational and Employee Advocate Role
“Champion” for employee concerns
Employee crisis management Responding to employee complaints
Operational to Strategic Transformation of HR
Approaches to Improving Organizational Productivity
The Role of HR in Strategy Formulation
Administrative Linkage One-Way Linkage Two-Way Linkage Integrative Linkage
Strategy Formulation
External Analysis
- opportunities - threats
Strategic Planning
Strategic Planning
Strategic Planning
Mission
Strategic Planning - reason for being
Goals
- what it hopes to achieve
Strategic Choice
- ways to fulfill goals and mission
HR Function HR Function HR Function HR Function
Internal Analysis
- strengths - weaknesses
HR Input
How HR helps strategy execution
• Functional strategies should support competitive strategies • Value chain analysis • Outsourcing • Strategy Formulation
HR means performance
• Can HR have a measurable impact on a company’s bottom line? • Better HRM translates into improved employee attitudes and motivation (e.g., working at home) • Well run HR programs drive employee commitment
TOYOTA
Strategy Implementation
HR Practices - recruitment - training - performance management - labor relations - HR planning - job analysis - job design - selection - development - pay structure - incentives - benefits
Strategic Choice
HR Needs - skills - behaviors - culture
HR Capability - skills - abilities - knowledge
HR Actions - behaviors - results
Firm Performance - productivity - quality - profitability
doc_114465599.pdf