Human resource management in the twenty first century

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This report is intended to provide the reader with a relatively advanced and critical discussion of the key debates and themes around HRM as it is conceptualized and operationalized in the early part of the twenty-first century. The report below is structured focusing on the issues provided as question for the report writing. I have tried to answer the issue by splitting it into 4 different questions. Finally there is conclusion at the end followed by references.


I would like to thank (Your Prof Name) for their support and providing excellent knowledge about the topic, which has enabled me to deliver this report in acceptable form.

Question 1

Top management has come to understand that, if properly managed, human resources can be an important source of competitive advantage in an increasingly competitive world?

In virtually every market, customers are now demanding higher quality, lower costs and faster cycle time. To meet these requirements, the firms must continually improve their overall performance. Rapid advances in technology and improved processes have been important factors in helping businesses meet these challenges. However, the most important competitive advantage for any firm is its workforce-one must remain competent through continuous training and development efforts. However, successful organizations realize that well-structured and significant employees Training and Development correlate strongly with long-term success. Improved -performances, the bottom-line purpose of training and development. This leads the organizations into matured learning organizations. It is important to note that formal training refers to training activities that is planned, structured and occurs when people are called away from their workstations to participate in it.

During the last one hundred years in the training development field, it has seen many rapidly

changes and still continues experiencing them in its head long rush to keep up with the evolutionary process of adaptation to an ever changing world and its ever changing technology. With this comes the never-ending process of developing new learning process and methods to meet this changing technology.

HR-business strategy is defined as a conscious and explicit way of managing your organization's human capital to gain a competitive advantage. It can be viewed as a new, generic, business strategy in its own right. However, HR issues cannot be treated as a separate exercise from the development of the business strategy. HR-business strategy makes the two inseparable and indivisible. While the aims are simple and clear the formulation, development and implementation of HR-business strategy is a highly complex and difficult

process to instigate. Over time though, with determination and leadership, everyone in the organization will begin to understand the founding principles of the strategy (e.g. only do things that are fit for purpose, only do things that will create value) and these will guide their actions and behaviour every day. Managers will have to manage employees less. Employees will want to contribute more and will obtain much more satisfaction from doing so.

Firms succeed because people enable their success. HR leaders with a passion for talent and the credibility to embed that passion in others are critical to the success of international or local companies. They help install competitive advantage across the enterprise and throughout its subsidiaries. They look after the near term and the long term. They recognize the impact of diversity and remove the barriers to its full realization. Depending on the operating framework, the business parameters, and the roles of enterprise and subsidiary, HR leaders develop and implement well-balanced global, local, and hybrid talent management processes. For it is ultimately the demographics of the workforce, most importantly, the

availability of capability at all levels and across all geographies, sustained over many years and repeated through all business cycles, that determine the talent competence that delivers the objectives of the company. The HR leader must have an appreciation for and depth of understanding of global and local. He or she does not see conundrum, but opportunity. The choices the HR leader makes are predicated on "both/and" solutions, not "either/or."

The following elements of the talent management processes need debate and decision about the extent to which global overrides local, local takes precedence over global, or exactly what compromises are selected between the two. The debates and decisions need to be explicit. Implicit is not good enough. HR leaders need to decide the globality or localness of the employment brand, attraction strategy, recruitment sources, assessment techniques, and diversity and inclusiveness objectives on boarding programs, development assignments, cross-business/function development, extent of expatriation, leadership education, promotion policies, potential ranking, and succession planning. Within each subprocess, the range of choices themselves needs to be decided on and practiced. It's a challenge to achieve, but HR leaders must make the decisions and ensure that they work (Figure 1).

Talent management is only one of the major HR leadership processes that impact the organization's global/local capability. Others, such as appraisal,

reward, education, and communications, are also important and

necessary and constitute their own opportunity to contribute to getting

the balance right for organizations.

Figure 1: Talent Management

Example : Southwest Airlines determined that the strongest differentiator between Southwest and its competitors was the spirit of its people. So the company decided to use that differentiator externally as its competitive advantage. Finding and keeping the best talent in the airline industry became the secret

weapon from the earliest days.

Pfeffer 1994 has allotted 16 practices of competitive advantage through people

• Occupation security

• Incentive remuneration

• Involvement and authorisation

• Emblematic egalitarianism

• Long-term outlook

• Selectivity in hiring

• Worker ownership

• Groups and job restructure

• Pay compression

• Measurement of practices

• Cross-utilization & cross-training

• High pay

• Info distribution

• Preparation and skill growth

• Promotion from inside

• Predominant philosophy

Question 2

Hiring the right people and then equipping them with the right skills and abilities can substantially affect the quality and quantity of production.

Recruitment and selection are the key processes at the onset of the HR cycle. Their impact is wider, with the potential to alter the composition and culture of the organization. Yet what are striking is the limited attention HR practitioners appear to give empirical evidence regarding effective processes. Perhaps this lack of synergy reflects inadequate training, but maybe it suggests a lack of understanding between recruiters and researchers and a subsequent failure to tap into and inform the central concerns of organizations. Indeed, much of the research evidence in this field is garnered from undergraduate student populations whose insights, attitudes and behaviours may be very different from experienced professional


Recruitment and selection are distinct processes, focusing attention both externally and within the organization. Distinctions however can, and should, be drawn between volume processes and those concerned with the attraction and selection of individual job vacancies. The importance of the social process and resultant fit may be enhanced in the case of one-off jobs, which may involve key positions such as the chief executive; however, they should not be overlooked in large Recruitment and selection volume situations. The increased levels of competition within the labour market and a shift in recent years of research away from the organization onto the applicant and their reactions and attitudes has revealed the importance of the quality of the interaction between organization and applicant: rejected applicants may

also be current and future customers and consumers of the organization, performing an ambassadorial function for an organization. Emerging from this chapter are some overarching concerns which have highlighted significant shifts in applicant populations. One change is the increased globalization of applicant pools, in which further complexity has emerged with

challenges to the fairness and discrimination of the testing processes, attitudes towards cheating and faking of results, and the familiarity with technology.

A second challenge is through an ageing population, which may alter the emphasis onto the social and esteem components of work, challenge job criteria and their assessment. All of these issues reflect the on-going changes to the structure and location of work, the redictability and stability of job roles. Thus finding and identifying new employees remains a complex balance between data gathering and relationship building properly motivated and committed employees can add immeasurable value to an organisations bottom line.

Question 3

Properly motivated and committed employees can add immeasurable value to an

organisations bottom line ?

A brief review of classic motivation theories provides an understanding of the range of human need and hence of desired rewards. Key issues include the extent to which people are likely to be motivated by money alone, or by other issues such as the intrinsic rewards of the job itself, or even by belonging to the social community that constitutes the workplace. While much criticism has been levelled at early content theories in terms of methodology (or lack of it) and the Universalist nature of the findings, they do provide an insight into the complex

nature of matching rewards to individual employee needs. The early work of Maslow (1954) suggests a hierarchy of needs which the individual will aim to satisfy in ascending order, from basic physiological needs, through safety and security needs, social or love needs, needs for esteem, both from others and from self and finally self-fulfilment or the realization of one's own true potential. While this widens the range of potentially motivating rewards, it is very general and it is Herzberg (1966) who provides a more work specific theory of motivation.

Figure 2: Herzberg theory of Motivation.

Herzberg not only makes the distinction between extrinsic (hygiene factors) and intrinsic (motivators) rewards but he takes this further by suggesting that the traditional approach of rewarding labour with wages or salary does not result in positive job satisfaction for the individual employee. According to Herzberg, pay, along with other extrinsic factors such as job security and relationships with superiors, peers and subordinates are the factors that may cause discontent but, if improved or maintained well, will at best keep job dissatisfaction at bay but will not lead to job satisfaction. Such findings have massive implications for

economies like the British, which have traditionally used financial incentives as a means to motivate workers. While there is much debate over the effectiveness of financial incentives, such findings do hold warnings for over reliance on financial rewards and point to a need to design a reward system which accommodates the other needs experienced by employees.

The motivators or intrinsic factors leading to job satisfaction are identified by Herzberg as achievement, recognition, and interest in the work itself, responsibility, advancement and growth. The argument is that by building the possibility for such intrinsic rewards into employees' work, the level of job satisfaction will be increased.

Process theories break through the Universalist approach and, in so doing, further emphasize the highly complex nature of motivating employees. Vroom's (1964) expectancy theory is helpful in emphasizing the complexity of individual thought processes which may or may not lead to action. It is suggested that assessments, firstly of whether effort is likely to result in achievement of a specific task and, most importantly from the point of view of the current discussion, whether success in the task will lead to the individual's desired personal reward precede any possible action. It is this calculative thought process and the fact that the individual's desired reward may not be money that emphasizes the complex nature of an effective reward system.

Another process theory relevant to the design and operation of a reward system is Adam's (1965) equity theory, which centres on the importance of feelings of fair treatment and the possible behavioural manifestations which may result from perceived inequity. This theory highlights the fact that individuals make comparisons and that feelings of unjust treatment in comparison with fellow employees may result in withholding effort, restricting output, reducing cooperation and even withdrawal.

Figure 3: Motivation Theory.

Motivation theories argue that money is not the only motivator, that intrinsic rewards are important to individuals and should be built into any rewards system, but arguably overplay the importance of the latter (which organizations may find more attractive to focus on as they may appear superficially cheaper) at the expense of the former. Motivation theories suggest use of employment contracts, with their emphasis on the economic and the legal, might be argued as a form of deflection from a more holistic understanding of the expectations and aspirations embedded in the employment relationship. Much attention has focused in recent

years on the notion of a psychological contract which basically incorporates the expectations and assumptions, many unwritten, subjective and changing over time, that both employee and employer bring to the relationship (Rousseau, 1998; Rousseau, 2001). If this more embracing view of the employment relationship is adopted, then the implications, for the motivation of employees, permeate all aspects of the work situation. The need for an integrated system of reward building motivational factors into all aspects or the management of employees becomes apparent. The approach of line management, and indeed the consistency of this approach, the recognition of achievements and the provision of interesting work, where possible becomes important aspects of securing motivation. For those core workers whom the organization is keen to retain, skills development and careers management are essential while, for the unskilled and semi-skilled or peripheral workers, the need for training to enhance future employability may be highly regarded.

Two possible critiques of psychological theories of motivation may be advanced. The first is that they make something very simple, rather complicated. The employment contract is about exchanging wages for labour power, and in the modern economy, wages are what really matters; employees are unlikely to be committed to a job that is superficially pleasant if wages are the bare minimum needed for survival (Hyman, 1989). And, no matter how much window dressing is provided by management, some jobs are intrinsically less pleasant than others: this may be through specific policy choices by management (e.g. rigid supervision

and control) or simply represent the product of the dominant technology and/or the specific nature of the industry. Organizations such as Wall Mart and McDonald's that have controversial reputations for union busting and for low pay devote considerable resources to promoting the appearance (if not the substance) of team spirit amongst employees, yet high staff turnover rates underscore the extent to which it is difficult to secure commitment where wages are minimal (see, for example, Royle, 2000).

The second limitation is psychological theories of motivation tend to downplay the subjective effects of social context: 'social and structural factors . . . are generally reduced to the status of intervening variables' (Thompson and McHugh, 1999: 280). Motivational theories often assume that workers can be simply led or enticed, downplaying the importance of cooperation between workers themselves, and with management (ibid. 279). In practice, work environments incorporate complex social dynamics: workers may adjust their output to 'fit in', to improve their standing in the eyes of co-workers (which may involve making short bursts of intense activity to impress others), for altruistic reasons (to protect weaker or less effective colleagues), or adjust output to lengthen breaks or to 'reward' or 'punish' supervisors (that are subject to performance linked pay themselves) (see Burawoy, 1979).

Question 4

It was only natural; therefore, that Human Resource Management would eventually be elevated to the same level of importance and status as other major functional areas of the firm.

The periods have transformed and the part of human resources in the business wants to change. It is human resources' accountability to lead the business in selecting the one of the outstanding resource it has people. In today's international economy, everybody can have the technology, identical products. What they would lack would be the same man force. Every business is formed by an expert group of individuals. It turns out to be the duty of human resources to network the individuals with different experiences with its vision and goals to produce a merger that will achieve the purposes of both the business and the individual. Top Management needs to understand that in the forthcoming raw resources, finished goods and currency will not be important to firm's achievement. Man power would be important.

Imminent accomplishment will be determined by the way we use the thing that is not mentioned on the financial statement of the company, the knowledge capital of the firm, the know-how its individuals have.

It has been researched extensively on the subjects of board-level representation by personnel/HR directors and senior HR managers' participation in calculated decision-making. In early 1990s there has been a increasing interest in global HRM, reflecting the increasing acknowledgment that the effective management of human resources worldwide is a key factor of success or failure in universal business. There is also indication that HR limitations regularly limit the effective employment of global business strategies. Lately, it has been debated that the additional quick pace of internationalization and globalization leads to a more strategic role for HRM as well as changes in the content of HRM. Yet, while there have been several efforts to incorporate global corporate strategy and human resource strategy, amazingly, the part of the corporate human resources function has been ignored, particularly in the perspective of the global firm. This seeks to restore the stability. The problem addressed is, about the part of the corporate HR function in the global firm? It was found as an emerging agenda for corporate HR in global firms which emphases on top management improvement, progression planning and creating a team of global managers. We theorise this as a strategic concern with mounting the fundamental management capabilities of the business, and debate that it can be conveniently analyzed from the viewpoint of the learning business. "The point is the difference in thoughtfulness to each individual can take full advantage of his or her talent, so that firms can maximize their efficiency and so that the society would make the wisest use of its human resources" (Cascio). The tough task faced by HR managers nowadays is to identify ability and cherish the same cautiously and accomplish substantial efficiency increases over period of time. The firm is nothing but individuals. Technical advances globalize rivalry, demographic changes, the info revolution and tendencies towards service society have changed the procedures of the game considerably. "In this scenario, firms with same set of resources enjoy competitive advantage only through active and effective management of human resources" (Dessler). The part of HR manager is ever-changing from a guardian and screener to the organizer and transformation agent. In present day competitive world, extremely trained and dedicated employees are often a company's best bet. HR managers play vital part in planning and applying downsizing, restructuring and other cost-cutting activities. They make the organization into more responsive to innovations and technological changes. Employees are the assets of corporate success. HR professionals can help the organization in selecting and train the employees for any emerging situations and promote commitments of all employees at various levels. In this case the employees can work willingly and enthusiastically and thus a competitive advantage to the organization. Now, employees are seen as the sources of competitive advantages.

A companies human resources represents one of the most potent and valuable resources. Consequently, the extent to which a workforce is managed effectively is a critical element in improving and sustaining organizational performance. Managing people is one of the most difficult aspects of organizational management; it means dealing with people who differ physically and psychologically. Human Resources Management emerged as a practiced personnel function, promising flexibility, and responsiveness and marked increased in the value of the employee. The organizational context in which the human resources management finds itself currently is one of the rapid change and considerable uncertainty. Human resources management is also in the process of change with regard to the nature of the role performed. In the past, human resources management professionals performed

many functions themselves. The role they are taking on now is one of consultant to line

managers, where line managers perform many functions traditionally handled by human resources management professionals. Similarly, the trend is for business to shed all functions not directly related to core business. The changes surrounding us are not mere trends but the working of large, unruly forces, globalization, which has opened enormous new markets and a necessary corollary, enormous numbers of new competitors; the spread of information technology and the growth of networks; the dismantling of the corporate hierarchy and the politically charged downsizing and job disruption that accompany it.

The new economy is moving away from being asset-intensive towards becoming more knowledge intensive. The focus is thus moving from providing product to providing services. As most organizations have access to the Internet and the latest technology, the people within the organization provide the competitive advantage, not the product or the technology. In the new economy, people are an organizations greatest asset. It is the role of human resource management and the human resource professional to nurture this asset. The new sources of sustainable competitive advantage in the new economy have the people at the centre creativity and talent, their aspirations and hopes, their dreams and excitement. The companies that flourish in this decade will do so because they are able to provide meaning and purpose, a context and frame that encourage individual potential to flourish and grow.

Thus human resources management has an important and essential role to play in organizations in the new economy. To fulfil this role, organizations will needs to evaluate their existing human resources functions and adapt them to suit the needs of the new economy and individuals working in organizations in the new economy.


Global HR leadership is possible and doable, as well as local or a combination of the two. HR leaders are called on to make choices among all three options that work for their firm. The quality of choice is dependent on the capability of the HR leader, who is also accountable for the outcomes. Getting the balance right is the ultimate contribution the HR leader makes.

Like any other area of HRM, managing reward is a complex business that is difficult to approach objectively; ultimately, subjective interpretations of employees (either individually or collectively) and supervisors make it difficult to impose 'scientific' systems. This means that, for most organizations, pay setting is likely to be bound up with the institutional setting and its own history.

. Many companies concluded that HR people deserves a seat at the management table as a business partner this was appropriate. But few have been prepared to take on this responsibility. They are still focused on transactions, not transitions. Rather than eliminating non-value-added work, they attend conferences and programs to be more proficient in doing non-value-added work. Unless these individuals take on development opportunities to understand what is required to be a successful business partner and employee

champion, they will forever be in the category of a "never-will-wannabe." Was it not Lord Tennyson who wrote, "to strive, to seek, to find, and not to yield"? Being an outstanding HR executive is not easy, but it is very important to the workforce and, therefore, to the company. And doing it well is both professionally and personally rewarding.

In the end, the modern employment contract is about pay and pay related factors; all manner of hot air about caring, communication, belonging and all manner of other 'soft motivators' is likely to be meaningless to employees unless they can count on a decent wage and proper job security.