Human Resource Management (HRM) is the function within an organization that focuses on recruitment of, management of, and providing direction for the people who work in the organization. Human Resource Management can also be performed by line managers.
Human Resource Management is the organizational function that deals with issues related to people such as compensation, hiring, performance management, organization development, safety, wellness, benefits, employee motivation, communication, administration, and training.
Definition of HRM: William R. Tracey, in The Human Resources Glossary defines Human Resources as: “The people that staff and operate an organization”; as contrasted with the financial and material resources of an organization. Human Resources is also the organizational function that deals with the people and issues related to people such as compensation, hiring, performance management, and training. A Human Resource is a single person or employee within your organization.
What Is the Human Resource Department?
Answer: Departments are the entities organizations form to organize people, reporting relationships, and work in a way that best supports the accomplishment of the organization’s goals. Departments are usually organized by functions such as human resources, marketing, administration, and sales.
But, a department can be organized in any way that makes sense for the customer. Departments can also be organized by customer, by product, or by region of the world.
Impact of HRM on Human Resource Function : –
HRM function contributes to organisational effectiveness in the following ways: –
Helping the organization reach its goals.
Employing the abilities and skills of the workforce efficiently.
Providing the organisation with well-trained and well-motivated employees.
Increasing the fullest the employee’s job satisfaction and self actualisation. Developing and maintaining a quality of work life that makes employment in the organisation desirable.
Communicating HRM policies to all employees.
Helping to maintain ethical policies and socially responsible behaviour.
Managing change to the mutual advantage of individuals, groups, the enterprise and the public.
The Human Resources Management (HRM) function includes a variety of activities, and key among them is deciding what staffing needs you have and whether to use independent contractors or hire employees to fill these needs, recruiting and training the best employees, ensuring they are high performers, dealing with performance issues, and ensuring your personnel and management practices conform to various regulations. Activities also include managing your approach to employee benefits and compensation, employee records and personnel policies. Usually small businesses (for-profit or nonprofit) have to carry out these activities themselves because they can’t yet afford part- or full-time help. However, they should always ensure that employees have-and are aware of-personnel policies which conform to current regulations. These policies are often in the form of employee manuals, which all employees have.
Some people distinguish a difference between HRM (a major management activity) and HRD (Human Resource Development, a profession). Those people might include HRM in HRD, explaining that HRD includes the broader range of activities to develop personnel inside of organizations, including, e.g., career development, training, organization development, etc.
There is a long-standing argument about where HR-related functions should be organized into large organizations, e.g., “should HR be in the Organization Development department or the other way around?”
The HRM function and HRD profession have undergone major changes over the past 20-30 years. Many years ago, large organizations looked to the “Personnel Department,” mostly to manage the paperwork around hiring and paying people. More recently, organizations consider the “HR Department” as playing an important role in staffing, training and helping to manage people so that people and the organization are performing at maximum capability in a highly fulfilling manner.
Models and Phases in HRM debate
Task 1 b
EVALUATE THE ROLE OF STRATEGIC HUMAN RESOURCE MANAGEMENT IN RELATION TO THE ORGANISATIONS BROADER OBJECTIVES, EVALUATE HR PRACTICES IN BOTH PROFIT MAKING AND NOT FOR PROFIT PRGANISATIONS.
Strategic Human Resource Management
Definition of HYPERLINK “http://www.strategic-human-resource.com/definition-of-strategy.html””HYPERLINK “http://www.strategic-human-resource.com/definition-of-strategy.html”StrategyHYPERLINK “http://www.strategic-human-resource.com/definition-of-strategy.html””
A strategy is a step-by-step plan of action prepared by an organization and by which it aims to achieve its plan or plans, thus, ensuring its success and survival.
Strategic management may be understood as the process of formulating, implementing and evaluating business strategies to achieve organizational objectives. Analysis of the environment, formulation of strategies, implementation of strategies, and evaluation and control are the phases in the strategic management process.
Strategic Human Resource Definition
Strategic human resource defines employees as a resource, an asset, that provides competitive advantage to an organization, and on whom organizational success is leveraged.
This is the new way adopted by many organizations in the treatment of their employees, making them the prime drivers or one of the prime movers of corporate success.
People, not machines, not systems, not other assets, are in the special position in helping the organization attain its objectives. These other things, however, are also important. But people are needed to make use of them in productive ways.
Some companies are now convinced that their people are the most important asset. And that without them, they cannot achieve much. In this way, they are implementing a strategic human resource management approach.
“Human Resource Strategy” Definition
This is the step-by-step plan of action by which an organization employs, utilizes or manages, develops, and deploys its human resources in order to attain its defined corporate mission and objectives.
A human resource strategy is devised in respect of recruitment, employee deployment, motivation and engagement, and employee retention.
By doing this, an organization puts itself in the position of being able to achieve its mission and objectives through its human resources.
This follows from the way how strategic human resource is strategically defined.
Strategic Human Resource Management
This is the effective way of organizing the workforce by the adoption of a specific strategy, where employees’ performance can help to achieve the planned organizational targets, such as increasing revenue or improving the profit margin.
Strategic human resource management is “human resource management” carried out in a strategic way. The human resource activities are linked to the achievement of the organization’s overall objectives.
This is the new way of managing human resources as compared to personnel management.
Strategic HR Plan
Strategic human resource plan refers to the strategic plan whereby employees’ energy, time, capabilities, competencies and knowledge are incorporated in a step-by-step plan of action so that their contribution can be monitored and measured over time.
By doing this, human resource can become the prime drivers of corporate success. The human resource plan is aligned to the corporate plan.
The primary goal of strategic human resource plan is to improve employee productivity thus helping to generate higher revenue for the organization.
Why must your organization be concerned about strategic Human Resource Management?
Organizations, particularly business entities, must succeed financially if they are to survive. This is the reason why business plans are prepared.
This is one of the simple ways in understanding the important factors related to strategic human resource.
Your organization, too, has its business plan. The only thing left to do is to make it a reality.
When you adopt a strategic HR Management plan, there is a high probability that certain positive results will ensue.
This can result in the following:
Enhancement of your organization’s economic performance
Increase in employee and organizational productivity
Increase in your survival rate as a corporate entity
Lower labour turnover
Increase in customer satisfaction
Your HR function does not become redundant due to value-adding quality
Pfeiffer lists seven dimensions of effective people management.
Rigorous selection of employees
Self-managed teams and decentralized decision making
Comparatively high compensation linked to individual and organizational performance
Reduced status distinctions, and
Extensive sharing of financial and performance information throughout the organization
Formulate strategies to ensure that you can attain these objectives.
In order to ensure that employees can play their respective role in the organization, you need an HR plan of action.
You need to conduct HR strategic planning to this effect.
Further to this, you need to train and develop your people in order that they have the knowledge and skills to perform their respective tasks.
Human Resource Strategic Approach
In strategic Human Resource management, you can choose to place emphasis on “HYPERLINK “http://www.strategic-human-resource.com/human-resources-performance-management.html”performance improvement and competitive advantage.HYPERLINK “http://www.strategic-human-resource.com/human-resources-performance-management.html””
This has the potential of leading to industrial conflicts.
You also have the choice of adopting the “soft approach”. This approach takes into consideration an employee’s superior know-how, commitment, motivation and job satisfaction.
Some argue that this approach is manipulative. But there is more to the HRM approach than this.
The process adopted by organizations may differ.
Your HR Manager and HR professionals can assist as this is their role.
Formulate your HR mission and objectives to provide the connecting link between all HR management activities.
Clearly define and understand your HR “strategic intent.”
R. Collins states:
“Improvement in the strategic management of people also requires a commitment to sustained long-term action.”
Understand the business carried out by your organization. This includes HR Managers and HR professionals.
Choose the strategy you will adopt to migrate from “people business to business business”. This is making HR as Strategic Partner.
Formulate your HR strategic plan, understand what it is intended to achieve, and how to link it to the overall business objectives.
Implement the plan. This requires a strategic implementation plan to ensure the plan is understood and accepted by everyone in the organization.
Obtain feedback on outcomes. Use these as inputs in future decision making.
Review and amend plan accordingly, communicate and re-implement.
Human Resource Management Strategy
To ensure a high probability of success in the implementation of strategic human resource management, a number of things are necessary.
Strategic recruitment where the right person is selected to fill the right job and according to organizational needs
Using the right mix of incentives to motivate and engage employees who then can concentrate improving their performance
Appointment of the right HR Head to provide the necessary leadership in making HR as a strategic partner
An HR mission statement with well defined HR objectives drawn up in alignment with the overall organizational objectives
Provision of the right set of training and development programs on an on-going basis to every level of employees
Implementation of a performance management system to identify high-performing employees for the purpose of giving rewards befitting their performance, work quality and output
Giving recognition and implementing a fair rewards system to retain quality employees
The Human Resource Function
Someone, somewhere within your organization must carry out the HR function.
If not, your organization cannot fulfill its legal and contractual obligations towards employees.
So, who are responsible for the HR function?
Human Resource Managers are appointed for important purposes. HR professionals are there to help them.
Your organization may have appointed an HR Manager or an HR Director or both.
If your organization is very serious about implementing strategic human resource management, appointing an HR director goes a long way in ensuring that the HR plan is treated as important as the organization’s business plan. He or she can provide the necessary leadership on all matters relating to HR.
Whatever is the approach, it is crucial that you have a competent person looking after this important function. It is important to remember that HR leaders do face a lot of different problems.
Capable professionals are what your organization needs to succeed in implementing strategic HR management.
Note however, that a survey had shown that there are still a lot of organizations who do not place much importance to human resource. Surely, your organization doesn’t want to follow suit.
Some organizations may have even decentralized or outsourced the entire function.
The Better Option
Decentralizing the entire HR function goes against the new development and trends in HR management.
However, you can decentralize certain human resource activities to line managers.
When you do this, provide them with all the necessary support.
Make your line managers responsible for the occupational health and safety issues in their own area of operations, the training of their subordinates, recruitment for their respective sections according to needs, and the performance appraisal of their subordinates.
Integration of Strategic Human Resource Management into Planning and Decision Making Process
It is now accepted that without people, achieving result is practically impossible.
In managing your people, prepare a long-term plan to integrate your organizational goals with HR policies and actions.
Strategies are implemented in identified key HR areas to improve employee motivation and productivity.
You need to see whether your HR strategies are competitive enough as compared to industry standards. Benchmark them while exercising due care.
Information must freely flow throughout the organization. You can ensure that this can by adopting an effective informantion system.
Strategic Human Resource Management and Business Strategy
Strategic Human Resource management helps to identify the business strategy that you can adopt.
For example, you implement an effective training and performance improvement plan to improve customer service.
More satisfactory customer service will bring in more revenue.
You can use this superior performance to determine the rewards. This, in turn, motivates your employees to perform better.
Learning forms a necessary part of improving human resource management both on the part of employees and management.
The 7 S of HRM attempts to simplify the important characteristics of human resource management. Thereafter, conduct a more in-depth examination.
So what are the 7S of HRM?
Strategic-ally-linked to the organization’s Mission and Objectives
Standard-based, that is, people management is benchmarked against current “best HR practices” that serve as performance measures
Systematic, that is, sound and clearly-defined HR policy, well-planned systems and procedures aimed at achieving strategic HR objectives while, at the same time, complying with the law
Stretching people in the performance of their duties and responsibilities on a daily basis in order to achieve service excellence
Strengthening the ability and competencies of employees and the capability and capacity of organizations to accomplish defined targets
Stress-tested capability, ability and leadership skills of the management team, and
Sustaining high employee and organizational productivity on a continuous basis based on TQM standards
The Future of Strategic HR Management
Proponents of strategic HR management generated tremendous interest on the subject.
Some large organizations had implemented it.
In contrast, some lament the ineffectual efforts by many organizations in implementing the system.
Strategic human resource management is not going to disappear. This is so as long as people continue to run organizations of whatever size and for whatever purpose.
If HRM Does Not Take The Lead, Who Will?
If HRM does not start down the relationship management path, someone else will, and as “old” HRM continues to be outsourced, one must wonder what will be left for today’s HR executives? Relationship management is an opportunity that can be seized by HR executives who are truly strategic and who understand what is needed succeed today and remain competitive as the business landscape continues to evolve and change.
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Evaluate HR practise in both profit making and not-for-profit making organisations
Any organization, may it be profit oriented or not-for-profit, the most vital asset is its employees. And for these organizations to maximize their assets, they should manage the employees’ working condition with intelligence and efficiency. They must be allowed to be involved in making work-related decisions to further enhance the organizational structure . Furthermore, the structure of tasks among the employees strengthens the organizational performance. It is therefore necessary to understand the employees for the organization to be effective. The development, building, motivation, enhancement and enrichment of the employees of any organization largely depend on the leadership, mandate and vision of the organization .
Traditionally, HRM is the helps the organizations in achieving the goals of the organization by hiring and maintaining efficient employees. According to (2002), the following are some of the responsibilities of HRM:
Train the workforce to maintain competitiveness of the organization.
Develop and communicate industrial policies and procedures in line with legislation.
Involvement in grievance and disciplinary hearings.
Implement termination and hiring procedures.
Assessment and management of organizational climate and employees relations.
Liaison with trade unions.
Implementation of outcomes of collective bargaining and negotiation.
Develop compensation strategies and polices in line with legislation and the organization’s business strategy.
Attach meaningful monetary values to posts in the organization ensuring that the organization’s compensation is in line with market forces.
Develop appropriate compensation systems for the organization.
Manage overall labour costs.
Provide current information regarding employees to be used in the decision-making process and measurement of HRM’s contribution to the organization.
For example: – In this case, Tesco has 240,000 employees that contributed to the £33.974 billion GBP in 2005. The apparent effective implementation of HR functions by the HR personnel of Tesco is a basis itself to prove that HR strategy is a tool for competitive advantage. Being governed by CEO , Tesco provided comprehensive execution of the HR function with respect to the employees’ welfare.
Aside from the continuous strategic planning and innovation, customer relations and welfare management, as well as HRM and its strategies, Tesco gained its respected reputation and dominance in UK retailing sector.
HR and Organization’s Performance
In the era of globalization, every organization like Tesco must keep itself along with all the other organizations on being globally competitive. Corporate or organizational competitive advantage does not only depend on the organization’s financial resources but on the human resources too. That is, for the organization to achieve competitive advantage, the people involved in the organization must also be competitive.
HR strategies or HRM in general, is a distinctive approach to employment management which seeks to achieve competitive advantage through the strategic deployment of a highly committed and capable workforce, using an integrated array of cultural, structural and personnel techniques. It is about understanding, researching, applying and revising all human resource activities in their internal and external contexts as they impact the process of managing human resources in enterprises throughout the global environment to enhance the experience of multiple stakeholders, including investors, customers, employees, partners, suppliers, environment and society.
Task 1 C
DISCUSS CONTRIBUTION MADE BY HRM IN CONTROLLING THE MANAGEMENT OF CHANGE
The constant evaluation of the effectiveness of the organization results in the need for the HR professional to frequently champion change. Both knowledge about and the ability to execute successful change strategies make the HR professional exceptionally valued. Knowing how to link change to the strategic needs of the organization will minimize employee dissatisfaction and resistance to change.
The HR professional contributes to the organization by constantly assessing the effectiveness of the HR function. He also sponsors change in other departments and in work practices. To promote the overall success of his organization, he champions the identification of the organizational mission, vision, values, goals and action plans. Finally, he helps determine the measures that will tell his organization how well it is succeeding in all of this.
Increasingly, change management is seen as a permanent business function to improve efficiency and keep organizations adaptable to the competitive marketplace. Many organizations strategically use change to improve organizational effectiveness. But bringing about successful change in today’s competitive environment requires thoughtful planning, effective communication and employee acceptance.
As the function with primary responsibility for human capital management, HR needs to be involved from the beginning when major organizational change initiatives are being developed.
The impact of major organizational changes on employee attitudes cannot be overstated. Change can create enormous tension in the workplace. Many people are uncomfortable with change, and are filled with uncertainty and apprehension over job security and the future, circumstances that can threaten the success of change initiatives. According to the Society for Human Resource Management’s (SHRM) 2007 Change Management Survey Report, the top two obstacles encountered during major organizational change are communication breakdown and employee resistance.
HR leaders can help get employee support for change initiatives by ensuring that communications about change are clear, constant and consistent. Communication largely determines how change initiatives are received and supported, and most HR professionals have highly developed communication skills. SHRM’s survey found that when HR was involved in change management communications, employee understanding improved, communication between managerial and non-managerial employees improved, and potential risks were identified and mitigated.
Communication that fails to engage employees and to inform them of the reasons, processes and expected benefits of major organizational changes can lead to lack of employee buy-in and, ultimately, failure of change initiatives.
Research shows that HR is the critical link to successful organizational change. To ensure agreement of stake-holders at all levels of the organization, HR can foster effective change management by clearly communicating the organization’s vision, carefully designing change initiatives, providing updates at all stages of the program, and engaging both top management and employees throughout the process.
When it comes to organizations, HR has a pivotal role to play in ensuring that change is realized, hopes are met, and success is sustainable. And that’s a recurring theme that is here to stay.
Task 2 a
DISCUSS THE NEED FOR LEARNING IN ORGANISATIONS TODAY AND EVALUATE THE ROLE OF BOTH THE ORGANISATIONS AND THE INDIVIDUAL IN THE DEVELOPMENT PROCESS TODAY
Why do we want a Learning Organization? — because it gives organizations the possibilities to discover who they are, where they want to go, and define the quality of life they wish to pursue.
A Learning Organization is an organization that focuses on continually growing and changing through the acquisition of knowledge. Such an organization fosters an environment of knowledge sharing and encourages employees to gain new knowledge. Such knowledge increases the organization’s profitability and customer satisfaction.
In the Fifth Discipline, Peter Senge describes learning organizations as places “where people continually expand their capacity to create the results they truly desire, where new and expansive patterns of thinking are nurtured, where collective aspiration is set free, and where people are continually learning to see the whole together.”
It is widely recognized that innovation is driven by new knowledge, and there is clear relationship between learning and knowledge, but it is this balance between learning and knowledge that is so critical to successful knowledge management and innovation. To achieve a sustainable competitive advantage where new knowledge results in critical innovation it is necessary to develop both a superior knowledge capability balanced by a superior learning capability. Those organizations who are adept at knowledge capabilities but are also less adept at learning capabilities will likely see their competitive position eroded by those organizations with less knowledge but a greater capacity to learn and then catch-up. And for that reason it is critical for any learning organization to gain new knowledge from which learning can occur, and to learn from application of current knowledge and to use this learning as a driver to obtain new knowledge. The learning organization focuses on its systems as part of the bigger picture to identify opportunities to use knowledge and learning to increase knowledge and intellectual capacity and improve performance.
The Need for the “LEARNING ORGANIZATION”
The nature of the environment has changed dramatically due to significant economic, social and technological changes over the past decades. Organizations today are confronted with increasing environmental turbulence arising from global competition, the introduction of new technologies, shortened product lifecycles and political and social pressures. Organizations, today must be flexible and learn to anticipate changes and respond rapidly. Today, learning makes the critical difference among organizations.
Learning can hardly be described as a new characteristic of organizations. Organizational learning is as old as organizations themselves. What is new, is an increased awareness of the connections between learning and competitive ability as well as better insight into the conditions for effective learning. In the long term it is said that learning will only provide competitive advantage to organizations that learn faster and better than their competitors.
Changes in the business environment have significant implications for learning
Any organization in business cannot afford to stand still. It must improve its ability to deliver higher quality goods and services at competitive prices or it will go out of existence. This trend has resulted in emergence of World Class Organizations (WCOs), in which enterprises can compete effectively on a global basis. This does not mean the organization has to do business in an international level. However, if a Multi National Enterprise (MNE) sets up operation locally, the WCO must be able to compete effectively or if it is a supplier, it must make a competitive bid to supply the MNE with the desired goods. Simply stated, enterprises now use their competitive advantage to invade international markets, and local companies should meet the challenge.
Figure 1 illustrates as how to be more than just being a total quality or adaptive organization. It means learning how to anticipate and stay ahead at impending changes (qualities of learning organizations) and how to continuously improve to maintain a competitive advantage.
What do organizations need to do to become WCOs?
There are six pillars of WCOs and each represents a human relations challenge. They are depicted here:
Table 1. Characteristics of a Learning Organization and Associated Best Practices
Associated Best Practices
Self mastery- individual
The ability to honestly and openly see reality as it exists; to clarify one’s personal vision
1.Positive reinforcement from role models/managers
3.More interaction time between supervisory levels
4.Emphasis on feedback
5.Balance work/non-work life
Greater commitment to the organization and to work; less rationalization of negative events; ability to face limitations and areas for improvement; ability to deal with change
Mental models – individual
The ability to compare reality or personal vision with perceptions; reconciling both into a coherent understanding
1.Time for learning
3.Habit of inquiry
4.Forgiveness of oneself
Less use of defensive routines in work; less reflexivity that leads to dysfunctional patterns of behavior; less avoidance of difficult situations
Shared vision – group
The ability of a group of individuals to hold a shared picture of a mutually desirable future
3.Empathy towards others
4.Habit of dissemination 5.Emphasis on cooperation
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