EMERGING ISSUES IN HUMAN RESOURCE MANAGEMENT
Miss. P. PIRAKATHEESWARI, Lecturer in Commerce, Sri Sarada College for Women (Autonomous), Salem – 16.
The management of Human Resources has now assumed strategic importance in the achievement of organizational growth and excellence. As globalization advances and we move into the information age, organizations need to adapt to the changes in technology and the changing issues in management of people.
Some critical issues have clearly emerged – planning, acquisition and development of human resources, responding to the demands of the work place and, above all, evolving a strategy of dealing with industrial conflict. As a management practice, it covers all the conventional areas of personnel management and industrial relations, as well as the relatively new areas such as communication, counseling, training and development, and job enrichment. An attempt has been made in this paper to point out the experiences on the emerging issues in managing human resources.
The Changing Nature of HRM Function
Today, competitive advantage is based on the successful application of knowledge. Managing people, as an HRM function, has broadened, to include managing organizational capabilities, relationships, learning and knowledge. These functions include four generic areas, i.e., (i) Roles, (ii) Relationships, (iii) Strategic focus, (iv) Learning focus. These areas are different from each of the economy functions, like traditional, transitional and knowledge.
- Crafting creative business strategies
- Organizational restructuring
- Creating social networks
- Invoking new challenges
- Shifting approach
- Enabling companies to go global
- Leading to superior performance
- Creating knowledge work force
Human Resource Information System (HRlS) for Effective HRM
In today’s competitive business environment, the cutting edge for any organization is given by the speed with which it takes decisions to respond to changes in the environment, internal or external. A well-designed computerized HRIS alone can provide the information and analysis within the shortest possible time. Now-a-days, many organizations are using the computerized HRIS. They keep records in a compact manner, enabling access and retrieval, in a flexible way.
Benefits of HRIS
- Simplified data entry
- Less paperwork
- Fast and accurate
- Better use of feedback
- Increased efficiency
- Improved tools for data analysis
HRIS has great significance in every sector and it can play a vital role. It helps to have a better communication process in the organization and we can offer better service with less effort at reduced cost. Most importantly, organizations can hire and retain top performers, improve productivity and enhance job satisfaction of the employees.
Aspects of HRM
- Human Resource Planning
- Transfer & Planning
- Job Analysis
- Performance Appraisal
- HR Audit
- Total Quality Management
- Quality of Working Environment
- Quality Cycle
HRM in the Present Scenario
¯ Low motivation or mounting frustration
¯ Promotions are consolations for transfers
¯ Cadre conflict
¯ Reward and punishment system
¯ Development of strong training system
HR, HRM & HRD
Human Relations is called HR also known as Human Resources. Managing HR is called Human Resources Management (HRM). Developing HR is called HRD. HRM is a philosophy, while HRD includes the activities and processes undertaken to promote the intellectual, moral, psychological, cultural, social and economic development of the individuals in an organization, in order to help them to achieve higher human potential as a resource for the community. It is a continuous process by which the employees are assisted in a planned way to develop capabilities.
Trends in HRM
An organization’s labour force comes from its external labour market – individuals who are actively seeking employment. HRM helps organizations find and keep the best possible fit between their social system and technical system. Organizations need employees with broad skills and strong motivation. Recruiting and selection decisions are especially important for organizations that rely on knowledge workers. Employees’ responsibility and authority are given to make decisions regarding all aspects of product development or customer service. HR professionals can support organizational strategies for quality growth and efficiency. Organizations with international operations hire employees in foreign countries, where they operate, as they need knowledge of differences in culture and business practices.
Now-a-days, information system has become a tool for more HR professionals, and often, these systems are provided through the Internet. The widespread usage of the Internet also includes HRM applications. Organizations search for talents, and screening candidates online. Employees may receive training online. The employment relationship takes the form of a psychological contract that describes what employers and employees expect from the employment relationship. The employees are looking for flexible work schedules, comfortable working conditions and greater autonomy, opportunities for training and development, and performance-related financial incentives. For HRM, the changes require planning for flexible staffing levels. Organizations seek flexibility in staffing levels through alternatives to the employment relationship. They may use outsourcing as well as temporary and contract workers.
It is that set of managerial decisions and actions that determine the long term performance of a corporation. It includes environmental scanning, strategy formulation, implementation, evaluation and control. The biggest benefit that strategic HRM offers is competitive advantage by building critical capabilities of HR in an organization. Strategic HRM facilitates in strategy formulation by making an organization’s SWOT analysis, and also in policy implementation by providing competent human resources and competitive intelligence.
HRM in LPG (Liberalization, Privatization & Globalization) Era
We can divide HRM into seven sections, i.e., HRM – Environment and Strategies, HRM – Acquisition and Absorption, Development, Maintenance and Retention, Control, Miscellaneous, HRM Practices.
HRM Environment and Strategies includes objectives, scope and functions, evolution and development of HRM. Acquisition and Absorption includes HR planning, job analysis and design, recruitment, selection, placement, induction and socialisation. Development section includes career planning and development, employee training, executive development, organization development and internal mobility and separation.
Maintenance and Retention section includes job evaluation, wage and salary administration, incentives and benefits, motivation, employee empowerment, workers participation in management, employee health and safety, social security, employee discipline, employee grievance, industrial relations, industrial disputes, trade unions, collective bargaining, performance & potential appraisal. Control section includes personnel research and audit, human resource audit and human resource information system. Miscellaneous section includes HRM in a changing environment, IHRM, HRM in virtual organizations. The final section is HRM Practices in various organization levels.
Corporate Strategy in Human Resource Management
Today, there is an urgent need to link human resource management, inextricable, to the business of the organization, at both the strategic and practical levels. The HR manager has the task of being on a constant look-out for the right choice of employees, fine-tuning the job mix and compensation package to benefit the individual and the organization, devising a flat organization structure and organizing training programmes for continuing the education at different levels in the organization.
Best Practices in HRM
A best practice in HRM has invoked a great deal of interest among HR professionals. Companies that are currently under-performing in the HR area can learn and adopt some of the best practices from organizations that have acquired some mastery over the good practices in HR. In the era of liberalization, the competitive scenario in the business environment has changed a lot. Consequently, HR practices have also changed phenomenally. The performance of the employees determines the failure or the success of an organization. There are four stages of integration between HR functions and the strategic management functions: –
- Administrative Linkage
- One-way Linkage
- Two-way Linkage
- Integrative Linkage
HR experts are having the opinion that, though “best practices in HRM” cannot be uniformly applied to all the organizations, they have a kind of uniform applicability in some functional areas, where psychological factors play an important role. Such areas are broadly classified as follows: –
- Process of selecting and recruiting the best talent.
- Allotment of work and responsibility, as would be appropriate to the employees natural talent and skill.
- System of initial training for new employees and specialized training for the experienced and skilled employees.
- Inculcation of a sense of team spirit.
- System of healthy and transparent communication, intra and extra company.
- System of periodic appraisal of the performance of employees.
- Suitable policy for career advancement of employees.
- Suitable policy for placement and transfer of employees.
- Suitable policy of recognizing and rewarding merit.
- Provision of security in service, to the deserving employees.
HRM in Cross-Cultural Context
Multi-cultural workforce congregations have become today’s workplace realities. The cross-border market terrorism spared by MNCs evoked counter-insurgency and strategic warfare from domestic businesses. Partnering people in this race is vital for success in the market place. Workplaces have increasingly symbolized multi-cultural villages, resulting in a growing need for cross-cultural intelligence. The future competitiveness of corporations will depend on their ability to attract and manage diverse talents effectively. Cross-cultural training will give managers on international assignments the cultural understanding essential to accomplish their tasks. Cross-cultural differences are the cause of failed negotiations and interactions, resulting in losses to the firms. The strategic role of HRM in strengthening and sustaining corporate growth has assumed paramount significance, the world over.
Products and process alone can’t help organizations to sustain loyal customers. They also need highly-motivated, dedicated and involved employees who are very passionate about their work and their organization; in short, they need “engaged employees”. But, nurturing engaged employees requires a lot of effort and skill on the part of HR managers and calls for a different HR philosophy in the organization.
We need employee engagement to serve as a core competency of an organization that would provide sustainable competitive advantage. We know employee engagement towards their work, throw few test “symptoms”, i.e., feeling of creating value, having a direction to follow, an air of trust, creating engaged employees through top management endorsement, a work environment to cherish, innovative leadership and clear growth trajectories, ‘one step up from commitment’. Employee engagement is the new buzzword. A successful business is directly linked to the commitment of its employees. Employee engagement ensures the successful execution of any business strategy.
HR Function & Performance Management
The challenge before human resource professionals today is to create an enabling organizational climate for the employees, For this, they need to examine relevant issues such as training and development, performance appraisal and career planning in the organization. Selection and recruitment of personnel is an important responsibility of the human resource department. The recruitment policy provides competitive remuneration as per industry norms, maintains high standards for selection of recruits, and encourages lateral induction to infuse fresh ideas and new skills in the organization.
Trends in Recruitment
Recruitment is increasingly becoming a two-way process, as a result of both employers and employees having higher expectations from one another. The first trend is using the resume database for recruitment; the other trend gaining prominence is the recruitment of key personnel from competitors, which is called “poaching”.
After successful selection and recruitment of manpower, it is essential that all employees undergo specific training programmes that help in maximizing their potential. Today’s need is to place training and development at the heart of a business strategy. Training should be a continuous process keeping in view the changing market demands, the environment and the organizations’ own culture. The role of a trainer, on the other hand, should be that of a mentor, facilitator and change agent.
Action Plan for Initiating Training & Development
- Assess the training needs of individuals who will be undergoing training, to avoid a mismatch with training programme.
- Provide a questionnaire to help the participants analyze their own capabilities. This includes their knowledge, skill, aptitude and attitude.
- Bring out the latent potential in people and channelize it towards the common goal of the organization.
- Design training programmes.
- Ensure that the programme covers behavioral and cognitive leaning, focuses on upgradation of skills and encourages group participation.
- Include the real world programmes to solve the real life problems.
Role of HR Manager in Employee Training
- To serve as an internal consultant.
- To identify programmes for individuals in tune with their individual skills.
- To plan a judicious mix of internal and external training programmes.
- To follow up activities to ensure that new skills learned, are applied in the organization.
- To monitor the performance appraisal of employees, to ascertain the impact of the training programmes and identify the future training needs.
Essentials of Performance Appraisal
Alignment, Standards, Commitment
Performance appraisal is a process of assessing the capabilities, both known and hidden, of employees, so that their strengths and weaknesses can be determined for increasing the organizational effectiveness. The appraisal is for identifying, whether the employee is: (i) Due for a promotion or reward or an increase in salary.
(ii) Capable of handling additional responsibilities or needs future training and development to upgrade their skills. (iii) Incapable of meeting the requirement and is, thus, dispensable.
360° feedback appraisal system is the formal performance appraisal system. In this system, the employee receives feedback from his manager, supervisor, peers and others, that he comes in contact with. It helps in increasing employee participation, makes the person feel more committed, increases his sense of ownership for company policies, and allows alignment of personal expectations with organizational goals. It helps in assessing the employee strengths and weaknesses.
Action Plan for an Effective Performance Appraisal
- The HR manager should explain the basic purpose of the exercise.
- Formal communication workshops should be organized.
- HR department should keep the confidentiality of the appraisal report; two-way feed-back should be created, the exercise should be presented as a forum.
- HR department should make a time-table for the appraisal process and review discussion in forums.
- HR department should work out the methods, incentives and department-wise ratings.
Performance & Rewards
It is a positive achievement cycle; it serves as a powerful motivational force for future growth. Success compensation refers to a salary component, various fringe benefits, performance-linked bonuses, stock options, etc. Compensation package emphasizes on performance, linked compensation, sharp increase in perks and allowances, recognition of special skills and abilities of individuals, increase in senior management remuneration, and salary increases for junior managers.
HRM in 2020
Now, we identify and discuss about five issues which are expected to affect the organizational HR in the future: (i) The corporations of tomorrow,(ii) Information age, (iii) Virtual corporation, (iv) Diversity, and (v) Social responsibility.
Corporation of Tomorrow
In future, there is a two-fold effect on Indian Industries, i.e.,(i) Generation of employment, and (ii) Industrial restructuring
We assume that in the future workplace, which may come true by 2020: –
- A majority of people worldwide will be connected through the IT infrastructure.
- Connectivity is the new frontier on the information highway to connect with one another.
- There are various factors on which the growth and expansion of connective technology will depend.
- The basic organizing unit in the workplace will be one individual engaging in business through connective technology.
- A learning culture will be festered by the technologies that will serve, entertain, and help people do their work. It will be basic workplace skill.
- Power in the organization of 2020 will be in flat structure.
- Culture and language will still move between the poles of traditionalism and modernism.
Information age has heralded a new way of doing business. IT has the power to change the most well-entrenched business paradigms. It has the power to link and connect people, and enable the exchange of products, services and capital, in an entirely different manner than in the past. IT has increased the efficiency of the human resource functions and reduced the burden of administrative work in the HR department, at the same time, helping to increase productivity.
A virtual company is usually a highly networked organization that extensively contracts out activities that were once performed in-house, allowing both speed and flexibility. The key to success in a virtual corporation is connectivity, i.e., the ability to network with a large number of independent companies.
Change in technology results in a change in the structure, design and environment of an organization. It has four stages:
(i) Acquisition of technology, (ii) adaptation of technology, (iii) utilization of technology, and (iv) improvement and development of technology.
Organizations of the future will operate in a workspace, which is likely to be much more broadly defined, than it is today. Connectivity within and outside the organizations, will create a world virtual reality organization.
Environmental problems fall into two broad categories, i.e.,
(i) Problems that arise out of poverty and inadequate development, and
(ii) Problems that arise out of the process of development (threat of earthquake, deforestation, pollution of ground water).
The traditional functions of HRM now need to be strategically directed towards developing and sustaining organizational capabilities, through activities that overlap with traditional business functions such as finance, marketing, and non-traditional activities, such as knowledge management. Human Resource Information System has great significance in every sector. It can play a virtual role and help the communications process in the organization. Most importantly, organizations can hire and retain the top performers, improve productivity and enhance job satisfaction of the employees. HRM has the responsibility to maximize efficiency and profit, but in the emerging scenario, the role of HR manager is changing rapidly due to changes in government policies, unions, labor legislations and technology. The trends have taken place in the organization, human resource planning, job design, motivation, recruitment and skill development and employee relations. The challenges can be faced by HRM effectively, if proper strategies are implemented. Hence, the role of HRM will be more significant in future due to the emerging scenario.