challenges of hrm

© 2005 by Nelson, a division of Thomson Canada Limited.

PowerPoint Presentation by Charlie Cook and adapted by Monica Belcourt.

Managing Human Resources,4th Canadian Edition

Belcourt et al.

© 2005 by Nelson, a division of Thomson Canada Limited. 1–2

Belcourt et al. 4th edition

ObjectivesAfter studying this chapter, you should be able to:

1. Identify how firms gain sustainable competitive advantage through people.

2. Explain how globalization is influencing human resources management.

3. Describe the impact of information technology on managing people.

4. Identify the importance of change management.

5. State HR’s role in developing intellectual capital.

6. Differentiate how TQM and reengineering influence HR systems.



Objectives (cont’d)After studying this chapter, you should be able to:

7. Discuss the impact of cost pressures on HR policies.

8. Discuss the primary demographic and employee concerns pertaining to HRM.

9. Provide examples of the roles and competencies of today’s HR managers.



Competitive Advantage through People• Human Resource Management

A set of inter-related policies, practices, and programs whose goal is to attract, socialize, motivate, maintain, and retain an organization’s employees

• Core Competencies Integrated knowledge sets within an organization that

distinguish it from its competitors and deliver value to customers.



Competitive Advantage through People• 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.



Overall Framework for Human Resource Management

Presentation Slide 1–1

COMPETITIVECOMPETITIVECHALLENGESCHALLENGES

• GlobalizationGlobalization• TechnologyTechnology• Managing changeManaging change• Human capitalHuman capital• ResponsivenessResponsiveness• Cost containmentCost containment

COMPETITIVECOMPETITIVECHALLENGESCHALLENGES

• GlobalizationGlobalization• TechnologyTechnology• Managing changeManaging change• Human capitalHuman capital• ResponsivenessResponsiveness• Cost containmentCost containment

HUMAN HUMAN RESOURCESRESOURCES

• PlanningPlanning• RecruitmentRecruitment• StaffingStaffing• Job designJob design•Training/developmentTraining/development• AppraisalAppraisal• CommunicationsCommunications• CompensationCompensation• BenefitsBenefits• Labour relationsLabour relations

HUMAN HUMAN RESOURCESRESOURCES

• PlanningPlanning• RecruitmentRecruitment• StaffingStaffing• Job designJob design•Training/developmentTraining/development• AppraisalAppraisal• CommunicationsCommunications• CompensationCompensation• BenefitsBenefits• Labour relationsLabour relations

EMPLOYEEEMPLOYEECONCERNSCONCERNS

• Background diversityBackground diversity• Age distributionAge distribution• Gender issuesGender issues• Educational levelsEducational levels• Employee rightsEmployee rights• Privacy issuesPrivacy issues• Work attitudesWork attitudes• Family concernsFamily concerns

EMPLOYEEEMPLOYEECONCERNSCONCERNS

• Background diversityBackground diversity• Age distributionAge distribution• Gender issuesGender issues• Educational levelsEducational levels• Employee rightsEmployee rights• Privacy issuesPrivacy issues• Work attitudesWork attitudes• Family concernsFamily concerns

Figure 1.1



Competitive Challenges and Human Resources Management• The most pressing competitive issues facing

firms:Going globalEmbracing technologyManaging changeDeveloping human capital Responding to the market Containing costs



Going Global

• GlobalizationThe trend toward opening up foreign markets to

international trade and investment.

• Impact of GlobalizationPartnerships with foreign firms “Anything, anywhere, anytime” marketsLower trade and tariff barriers

NAFTA, EU, APEC trade agreements WTO and GATT



Going Global (cont’d)

• Impact on HRMDifferent geographies, cultures, laws, and

business practices Issues:

Identifying capable expatriate managers. Developing foreign culture and work

practice training programs. Adjusting compensation plans for

overseas work.



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)Computerized system that provides current and

accurate data for 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, increase productivity,

and response times.



Major Uses ForHR Information

Systems

Source: HR and Technology Survey, Deloitte & Touche and Lawson Software, 1998.

HRM 1



Impact of IT on HRM

TransformationalTransformationalImpactImpact

TransformationalTransformationalImpactImpact

OperationalOperationalImpactImpact

OperationalOperationalImpactImpact

RelationalRelationalImpactImpact

RelationalRelationalImpactImpact

HRMHRMHRMHRM



HRM IT Investment Factors

• Initial costs and annual maintenance costs

• Fit of software packages to the employee base

• Ability to upgrade, increased efficiency and time savings

• Compatibility with current systems

• User-friendliness

• Availability of technical support

• Needs for customizing

• Time required to implement

• Training time required for HR and payroll



Managing Change

• Types of ChangeReactive change

Change that occurs after external forces have already affected performance

Proactive change Change initiated to take advantage of targeted

opportunities

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



Managing Change through HR

• Why Change Efforts Fail:1. Not establishing a sense of urgency.

2. Not creating a powerful coalition to guide the effort.

3. Lacking leaders who have a vision.

4. Lacking leaders who communicate the vision.

5. Not removing obstacles to the new vision.

6. Not systematically planning for and creating short-term “wins.”

7. Declaring victory too soon.

8. Not anchoring changes in the corporate culture.



Developing Human Capital

• Human CapitalThe knowledge, skills, and capabilities of individuals

that have economic value to an organization.



Human Capital and HRM

• Creation of knowledge

• Utilization of knowledge

• Application of knowledge



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 SigmaA process used to translate customer needs into a set

of optimal tasks that are performed in concert with one another.



Responding to the Market

• ReengineeringFundamental 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.



Containing Costs

• Downsizing The planned elimination

of jobs (“head count”).



Downsizing and Upsizing

Percent of companies reporting that they:

*All annual readings are for 12 months ending at midyear. Categories are not mutually exclusive.

Source: Gene Koretz, “Hire Math: Fire 3, Add 5,” Business Week Online (March 13, 2000). Figure 1.2



Containing Costs (cont’d)

• Hidden Costs of LayoffSeverance and rehiring costsAccrued vacation and sick day payoutsPension and benefit payoffsPotential lawsuits from aggrieved workersLoss of institutional memory and trust in managementLack of staffers when the economy reboundsSurvivors who are risk-averse, paranoid, and political



Containing Costs (cont’d)

• Benefits of a No-Layoff PolicyA fiercely loyal,more productive workforceHigher customer satisfactionReadiness to snap back with the economyA recruiting edgeWorkers who aren’t afraid to innovate, knowing their

jobs are safe.



Containing Costs

• OutsourcingContracting outside the organization to have work

done that formerly was done by internal employees.

• Employee LeasingThe process of dismissing employees who are then

hired by a leasing company (which handles all HR-related activities) and contracting with that company to lease back the employees.



Productivity Enhancements

Figure 1.3Presentation Slide 1–2

MOTIVATIONMOTIVATION• Job enrichmentJob enrichment

• PromotionsPromotions

• CoachingCoaching

• FeedbackFeedback

• RewardsRewards

MOTIVATIONMOTIVATION• Job enrichmentJob enrichment

• PromotionsPromotions

• CoachingCoaching

• FeedbackFeedback

• RewardsRewards

ENVIRONMENTENVIRONMENT• Empowerment Empowerment

• TeamsTeams

• Leader supportLeader support

• CultureCulture

ENVIRONMENTENVIRONMENT• Empowerment Empowerment

• TeamsTeams

• Leader supportLeader support

• CultureCulture

ABILITYABILITY• RecruitmentRecruitment

• Selection Selection

• TrainingTraining

• DevelopmentDevelopment

ABILITYABILITY• RecruitmentRecruitment

• Selection Selection

• TrainingTraining

• DevelopmentDevelopment

Perf = Perf = f f (A,M,E)(A,M,E)Perf = Perf = f f (A,M,E)(A,M,E)



Demographic and Employee Concerns

• The Diversity Challenge

HRM 4



Age Distribution



Gender Distribution



Rising levels of education



Cultural Changes

• Employee Rights



Cultural Changes

• Concern for Privacy• Changing Attitudes Towards Work• Balancing Work and Family



Top Issues for Managers in Balancing Work and Home

Executive recruiters say 75 percent of senior management candidates and 88 percent of middle managers raised concerns about balancing work and home. Top issues:

Source: Association of Executive Search Consultants (member survey). Used with permission of the Association of Executive Search Consultants, http://www.aesc.org.

Figure 1.8



Partnerships: Line Managers and Human Resources Managers

• Responsibilities of HRAdvice and counselServicePolicy formulation and

implementationEmployee advocacy



Strategic Human Resources Management• Strategy

The formulation of an organization’s missions, goals, and objective as well as the action plans to execute the strategy.

Corporate Strategy

Business Strategy



Strategic Human Resources Management• Strategic HRM

A set of interrelated practices, policies, and philosophies whose goal is to enable the achievement of the corporate or business strategy.



Human Resource Competency Model

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 10017, Phone: (212) 490-6387, Fax: (212) 682-6851. Figure 1.9

Presentation Slide 1–4

BusinessBusinessMasteryMastery

• Business acumenBusiness acumen• Customer orientationCustomer orientation

• External RelationsExternal Relations

BusinessBusinessMasteryMastery

• Business acumenBusiness acumen• Customer orientationCustomer orientation

• External RelationsExternal Relations

HRHRMasteryMastery• StaffingStaffing

• Performance appraisalPerformance appraisal• Rewards systemRewards system• CommunicationCommunication

• Organization designOrganization design

HRHRMasteryMastery• StaffingStaffing

• Performance appraisalPerformance appraisal• Rewards systemRewards system• CommunicationCommunication

• Organization designOrganization design

ChangeChangeMasteryMastery

• Interpersonal skillsInterpersonal skillsand influenceand influence

• Problem-solving skillsProblem-solving skills• Rewards systemRewards system

• Innovation and creativityInnovation and creativity

ChangeChangeMasteryMastery

• Interpersonal skillsInterpersonal skillsand influenceand influence

• Problem-solving skillsProblem-solving skills• Rewards systemRewards system

• Innovation and creativityInnovation and creativity

Personal Personal CredibilityCredibility

• TrustTrust• Personal Personal

relationshipsrelationships• Lived valuesLived values

• CourageCourage