CHAPTER 2:CHALLENGES IN STRATEGIC HUMAN RESOURCE MANAGEMENTCopyright 2005 South-Western. All rights reserved.

Major Factors Affecting HRMStrategic HRMTechnological AdvancementDemographics and DiversityGlobalization

Exhibit 2-1Issues for Integrating New Technologies

Exhibit 2-2Impact of Technology on Organizations

Technology Challenges for HRMTelecommutingEmployee surveillance & monitoringe-HREthical behavior

TelecommutingDramatic growth in number of Americans working from home3.4 million in 199019.6 million by beginning of 2000Issues affecting success of telecommuting programsClear performance measurement system is keyDeciding which employees will be offered participationEquipment expenseSome managers uncomfortable having direct reports away from office

Employee Surveillance and MonitoringMore than 80% of large employers utilize monitoring technology, e.g.,Internet usageE-mailsComputer filesVoice-mailTelephone usageUnder Electronic Communications Privacy Act (ECPA), employees have only limited privacy rights

E-HROpportunity to deliver transactional types of services online:PayrollEmployee benefitsSchedulingRecruitingTrainingCareer development

Ethical BehaviorMajority of jobs are considered to be at-willMovement toward greater protection for employees in regard to off-duty behaviorOwnership of workFairness of noncompete clausesSarbanes-Oxley Act of 2002:Seeks to eliminate deception in accounting & management practices by increasing government oversightHolds senior executives more directly responsible for violationsProtects whistle-blowers

Workforce Demographic Changes: Graying of WorkforceNegative aspects of older workersPerceived resistance to change by older workersIncreased health-care costs for senior workersBlocking advancement opportunities for younger workersHigher wage and salary costs for senior workersPositive aspects of older workersAs productive or more productive than younger workersHave more organizational loyalty than younger workersPossess broader industry knowledge and professional networks

Workforce Demographic ChangesBaby Boomers (19451962)Currently in excess supply in middle management ranksHR challenge is to manage plateaued workersBaby Busters (1963mid-1970s)Are often career bottlenecked by BoomersMany have skills in high demand; are doing and will do well

Workforce Demographic ChangesGeneration Xers (late 1970searly 1980s)Have life-long exposure to technology and constant changeSeek self-control, independence, personal growth, creativityNot focused on job security or long-term employmentGeneration Y: Baby Boom Echo (after 1979)High comfort level with technologyGlobal and tolerant outlook on lifeHighly entrepreneurialShorter attention spanOpting for more transient and variable project work

Workforce Demographic ChangesSexual orientationMore than 200 Fortune 500 employers offer full benefits for domestic partnersSexual orientation issues can impact bottom lineDisabilities54 million Americans with disabilitiesOften not included in diversity initiativesMany supervisors do not understand needs of employees with disabilitiesStereotypes

New Employee/Workplace DynamicsEmphasis on management of professionalsEstablishment of separate career tracksTechnical/Professional, Managerial /AdministrativeUse of project teamsLess employee loyalty, more loyal to selfStaying with employers for shorter periods; demanding more meaningful work and involvement in organizational decisions

New Employee/Workplace DynamicsIncreased personal and family dynamic effectsMore single-parent families, dual-career couples, & domestic partnersIncreased nontraditional work relationshipsPart-time, consulting, and temporary employment flexibilityOutsourcing and entrepreneurial opportunities

EthnicityIn 2005:Ethnic minority share of workforce roughly 28%Up from 22% in 1990 and 18% in 1980By 2050:Close to 50% of US population will be non-CaucasianBy 2025:African-Americans will represent 14% of populationUp from 12% in 1994Hispanics will represent 17% of populationUp from 10% in 1994Asians & Pacific Islanders will represent 8% of populationMore than double from 1994

Managing Workplace DiversityUnderstanding and appreciating diversityCritical to effectively marketing to ethnic and minority groupsPromoted by having diverse workforce at all levelsHelps ensure hiring and promotion decisions are unbiased by personal differencesDiversity management programs or initiativesMust be integrated with organizations mission and objectivesHelp key decision makers identify diversitys benefits to organizationMake critical decisions about implementing optimal program/initiative contingent on organization and its people, mission and culture.

Exhibit 2-6Individual Dimensions of Diversity

Strategic Management of DiversityDetermine why diversity is important Articulate how diversity relates to mission and strategic objectivesDefine diversity and determine how inclusive its efforts will beMake a decision as to whether special efforts should be extended to attract diverse workforceAssess how existing employees, customers, and other constituencies feel about diversityDetermine specific types of diversity initiatives that will be undertaken

Reading 2.1 (Kirkman et al.)Five Challenges to Virtual Team SuccessVirtual teams:Groups of people who work interdependently with shared purpose across space, time, and organization boundaries, using technology to communicate and collaborateTypes of virtual teamsGlobal virtual teamsTeams assigned to accomplish specific projectsCross-functional teamsChallenge: Recognize obstacles confronting teams that are both cross-functional and virtual

Reading 2.1Five Challenges to Virtual Team SuccessBuilding trust within virtual teamsMaximizing process gains and minimizing process losses on virtual teamsOvercoming feelings of isolation and detachment associated with virtual teamworkBalancing technical and interpersonal skills among virtual team membersAssessment and recognition of virtual team performance

Reading 2.2 (Starkman)Impact of the Sarbanes-Oxley ActNew whistleblower protectionsNo public company may discriminate against an employee because of any lawful actRetaliation against employee because of any lawful act done to assist a proceeding relating to alleged violation is prohibitedIf DOL determines that violation has occurred, employer may be ordered to reinstate employee and provide compensatory damages

Reading 2.2Impact of the Sarbanes-Oxley ActThe Act dramatically affects officer compensation programs Executive bonuses subject to forfeiture under ActPersonal loans to executives are regulated by ActSEC can remove or temporarily freeze payments to executives and directorsPublic accounting firms are precluded from auditing company if highly placed executive was employed by auditing firm and participated in companys prior years auditAttorneys have new rules of professional responsibility

Reading 2.2Impact of the Sarbanes-Oxley ActThe Act requires new employment policies and procedures Procedures for receiving and handling complaints of corporate fraud have to be establishedCompensation program bonus policies and stock option plans have to take account of new forfeiture provisionsHiring and recruitment strategies and background checks will have to be revamped to avoid hiring executives whose employment is precluded by the ActTraining required to properly implement all of the Acts mandates

Reading 2.3 (J. Schramm) Employee SatisfactionPotential impact of demographic changesAging population increases emphasis on health care benefits, retirement planning, and job securityWomen are attaining higher proportion of professional qualificationsFuture skills shortages may cause industrialized countries to compete for skilled immigrant laborIndustrial base shifting to service and health care sectorsWider political and economic trends affecting job satisfactionHealth care costsJob securityPensions

Reading 2.3 Employee SatisfactionTwo groups of issues:Those depending on financial position of companyBenefitsWagesJob securityThose less costly to implement through changing practices, processes, and cultureCommunication with managementWork/life balanceEmployees relationship with immediate supervisorCareer development