HRM IN A DYNAMIC ENVIRONMENT EXCEL BOOKS 3-1 3 Chapter
May 19, 2015
HRM IN A DYNAMIC ENVIRONMENT
EXCEL BOOKS
3-1
3Chapter
HRM In A Dynamic Environment
ANNOTATED OUTLINE3-2
INTRODUCTIONOrganisations are open systems and are, therefore, influenced by the environment (internal as well as external ) in which they operate.
HRM In A Dynamic Environment
3-3
External and internal factors influencing the Personnel function
External factors Internal factors
Technological factors Mission
Economic challenges Policies
Political factors Organisational culture
Social factors Organisation structure
Local and Governmental issues HR systems
Unions
Employers’ demands
Workforce diversity
HRM In A Dynamic Environment
Technological Changes And HRM 3-4
Technology includes tools, machinery, equipment, work procedures and employee knowledge and skills. The impact of technology on HR can be profound, as the following things clearly reveal:
New skills, knowledge, experience and expertise required to gain the edge over rivals.
Downsize operations, cut organisational layers and cut the extra fat to survive in a competitive world
Collaborate and achieve teamwork
Relocate work from the office to the home
Internet and intranet revolution
HRM In A Dynamic Environment
How to deal with a human resource surplus situation?
3-5
Why?
Automation
Restructuring
Mergers
Acquisitions
CompetitivePressures
Consequences?
Cuts payroll expenses
Eliminates extra layers
Improves functioning if firm’s product and
service profile is good
Shocks those left out
Shattering impact on
employee motivation
and morale if not managed
properly
Managing Survivors of downsizing
Bitterness, anger, disbelief and shock need to be handled properly
Give information as to why the action had to be taken
Tell how it is going to help the firm and employees in the long run.
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Role of HR in a virtual organisation
A virtual organisation is a network of companies or employees connected by computers. Virtual workers work from home, hotels, their cars, or wherever their work takes them. The human resource function plays a unique role in a virtual organisation:
Psychological fit: The lack of face-to-face interaction in a virtual organisation, virtually compels HR professionals to determine the psychological fit between different units initially.
System alignment: Given the lack of physical proximity, it becomes even more critical that the organisation's mission, vision and measures be aligned and that all parties are familiar with these issues; the HR function can play an important role in this task.
Reconsider rewards: In a virtual unit, very few permanent positions exist. In many cases, the organisation will be staffed with
workers having different motivational forces. So rewarding each entity in an effective way becomes an important job.
Cont…
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Reconsider staffing needs: In a virtual organisation, most employees work on a contractual basis. Finding people with requisite skills, knowledge and motivation levels becomes an important activity.
Build partnerships: Virtual, teams have to be built from scratch paying attention to their unique requirements. The concept of
employment needs to be replaced by the concept of 'partnership' especially when most tend to work independently away from the permanent employees or owners of the organisation
Develop leaders: Leaders become the major forces for building trust, creating a mission and instilling a sense of belonging to the organisation. HR can play a major role in ensuring that leaders
assume these responsibilities and meet them in an effective way.
Role of HR in a virtual organisation
HRM In A Dynamic Environment
Total Quality Management Programmes
3-8
TQM is a way of creating an organisational culture committed to the
continuous improvement of skills, teamwork, processes, product and
service quality and customer satisfaction.
HRM In A Dynamic Environment
TQM: The main ideas
3-9
Do it right the first time
Be customer oriented
Make continuous improvement a way of life
Build teamwork
Empower people
Create a climate of trust, an atmosphere for innovation
HRM In A Dynamic Environment
Total Quality HR Approach
3-10
The Total Quality HR Approach is all about employee participation
and empowerment, carried out in a sincere and wholehearted
manner. Rewards are designed to meet employee needs.
Employees are treated like customers. 360 degree appraisals are
carried out before picking up the best performing teams. Small
ideas and improvements are encouraged.
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Quality snaps of Indian companies
Name of Company Efforts toward TQM
1. Indo-Gulf Fertilizers Ltd Upgrading technology; training people; monitoring cost, quality and delivery criteria; participative management, HRD; ISO 9002 Certification, first fertilizer company to get this in India; Shaktiman Krishi Seva Kendras in UP, Bihar and West Bengal.
2. Bharat Heavy Electricals Ltd First to get ISO 9001 certification, in Dec 93; Strict metal parts (BHEL) quality control; 100% checking of insulators for testing their
strength; strict quality assurance tests; high quality testing labs, etc.
3. TELCO (Lucknow) SUMO model Jeeps manufactured here according highest priority to ISO 9000 certifications; training and self-inspection given top priority.
4. Philips India Ltd Implemented TQM in 1995; first step was moving toward international quality system standards ISO 9000; total employee involvement; creation of self managing mini, micro and mega-teams; got the European Quality Award; Kaizen and suggestion schemes introduced followed by rewards and recognition system; regular surveys of employee motivation levels accompanied by customer surveys
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Benchmarking
Effective implementation of TQM requires benchmarking. The essence of benchmarking is striving to be the best of the best in one’s area of operations. It is a continuous process of measuring products, services and practices against the toughest competitors or industry leaders with the aim of mutual improvement.
ReengineeringThe primary focus of TQM is on continuous improvement or ongoing incremental change. Reengineering is all about achieving this. Actually speaking, reengineering takes place when more than 70 per cent of the work processes in an organisation are evaluated and altered. The focus is on simplifying operations and making them more efficient and customer oriented.
HRM In A Dynamic Environment
Essentials of reengineering
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Give people a mission; a clear view of how to achieve that mission.
Either serve the customer superbly or don’t even try.
Change is the way of life. It is not a process, it is a value.
Technology is never really a problem. The problem is how to use technology effectively.
The wrong answer rarely kills you. What it does is waste time.
The weak link in reengineering is will.
Once people catch on to reengineering, you can’t hold them back. It’s a lifetime opportunity.
In India TELCO, TISCO, L&T, Ranbaxy and Crompton Greaves have successfully brought about radical changes through Reengineering.
HRM In A Dynamic Environment
Flexible Manufacturing systems 3-14
It is the integration of computer aided design, engineering and manufacturing to produce low volume products at mass production costs. In such a scenario, employees need to acquire skills and get trained constantly. One should be capable of handle a variety of tasks.
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Economic, Political And Social Challenges And HR
Now-a-days, people, goods, capital and information are moving around the globe as never before. Global competition is making every firm to think in terms of gaining an edge over rivals by producing high quality goods at a very competitive price. This is where the ‘people’ dimension comes into being. Incentives, favourable work climate, team spirit, freedom to think and act independently, and a host of other HR initiatives are needed to keep talent from flying away.
HRM In A Dynamic Environment
What HR managers can do ?3-16
Use workforce skills and abilities in order to exploit environmental opportunities and neutralise threats.
Employ innovative reward plans that recognise employee contributions and grant enhancements.
Indulge in continuous quality improvement through TQM and HR contributions (training, development, counselling, coaching etc.).
Utilise people with distinctive capabilities to create unsurpassed competence in an area (Xerox in photocopier, 3M in adhesives, Telco in trucks, Britannia in
biscuits, Nestle in coffee, McDonald’s in fast foods, etc.).
Decentralise operations and rely on self managed teams to deliver goods in difficult times (Motorola is famous for short product development cycles. It has quickly commercialised ideas from its research labs).
Lay off workers in a smooth way, explaining facts (IBM, Kodak, Xerox, AT&T, Steel and Textile firms in India etc.) to unions, workers and other affected groups. HR generally plays a key role, these days, in planning and implementing corporate downsizings, and then in maintaining the morale of the remaining employees.
HRM In A Dynamic Environment
Political factors
3-17
Political stability Formation of new political parties Influence of politicians over Productivity linked wage agreements Political parties sympathetic to trade unionism Opposition to VRS schemes, downsizing operations, restructuring exercises. Freedom to show the door to unwanted people
Social factors Conducting business in a socially relevant and responsible way. Hire qualified people or hire inexperienced local people and train them
to avoid trouble? Helping economically poor people, unemployed, underprivileged ones,
etc.
HRM In A Dynamic Environment
Local and government-related factors
3-18
Meet legislative requirements
Offering jobs to certain sections of local community
Trade unions Demands for higher wages, better working conditions, incentives,
benefits, services
HRM In A Dynamic Environment
MANAGING WORKFORCE DIVERSITY
3-19
The workforce is becoming increasingly diverse now and organisations are doing their best to address employee concerns and to maximise benefits of different kind to employees with diverse educational, cultural and religious backgrounds. The diversity issues, mainly, include the following:
Composition
In terms of age, caste, education, culture, region, religion
Minority groups
Economically backward groups
Displaced persons
Child labour
Contract labour
Women employees
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Ways to cheer up women employees
Provide alternative career paths
Offer extended leave facilities so that they can meet their pressing commitments according to their convenience
Allow female workers to create their own schedules and process work at home
Create flexible work arrangements
Permit job sharing especially in case of relatively independent tasks such as filing, faxing, word processing, photo copying etc.
In order to benefit from diversity, managers should recognise the potential concerns of employees and make sure that the exchange between the organisation and employees is mutually beneficial and satisfying.
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INTERNAL ENVIRONMENT AND HR
Organisations are also influenced by a variety of internal factors
relating to strategy, culture, structure etc.
Mission and Strategy
Internal Policies
Organisational Culture
Organisation structure
Human resource systems
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Designing appropriate HR systems
Issue Focus on
Nature of employment : Job/Career
Recruitment : Internal/external/both
Selection : Merit/other considerations
Training and employee : 6 months/yearlydevelopment actions Regular/irregular/need based
Degree of participation : Top down/bottom up
Incentives : Individual merit/group output
Job security : Lifelong employment/need-based jobs
Employee welfare : Be a model employer (offer those that are needed by law.)