The Significance Of Human Resource Management Commerce Essay

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Many managers and organizations now distinguish that a major source of competitive advantage frequently comes from the core competencies and capabilities of the organization such as product, quality systems, operations management, and human capital etc. but most of the organizations and managers underestimate the potential of human resource management for enabling the organization to gain a sustainable competitive advantage in the marketplace.

Markets are more dynamic and global now. Due to the current developments in market and industry, it has been realized by the corporations that human resource management is the most strategic core competency that could enable the organization to gain a sustainable competitive advantage in the marketplace. Importance of human resource management can be viewed as it helps to establish the overall Human resource programs for the different departments of the organization. It helps in establishing direct supervision and make adroitness between all the departments of the organization. For example it helps in strategic planning which is important to operate the services and capabilities of the organization. These main human resource activities include the study of economic indicators. Human resource helps in find out the changes in the demand and supply of labor. Also identify the company overall current and future needs. Assess or monitor the human resource presentation overall. The main function of Human resource management are staffing and selection of employees, orientation of employees there training and development. Human resource management also helps in human resource strategic and tactical planning. Helps in making reward plans, make performance appraisals also helps in career planning and performance management and helps in training the staff of the organization.

Human resource management is as important as the other departments of the organizations like marketing and finance to business. Human resource managements make important assistance to the organizations deliberate management. It helps to improved deliverance which depends on the, engage and competent people. Human resource management is also important to the investment because a strong linkage between human resource management and business strategy guarantees a competitive advantage in the marketplace. Most of the victorious organizations manage their employees well and make the rewards.  Human resource management helps organizations to achieve better results, using the expertise to build potential and sustain change in their organizations. (Dessler, 2005).

Human resource management is responsible for hiring, shielding and retaining organizations most important positive feature which is people. No organization will grow to its peak without strong, pleased and motivated people. Human resource management has specialized capability which helps in the organizational improvement. They help organizations in change management in nonstop improvement process and it also payback different organizational tasks. Such as the analysis of recruitment policy its administration and training session. Good and useful human resource management observed and investigates the multifarious business solutions and helps organizations in solving them. Human resource management also helps organization in maintaining and compiling the employee data base at work. It helps in reviewing the employee performances. Human resource experts make different strategies which helps to assess different problem like employee turnover causes of their low self-confidence and there low performance. Human resource management helps employees to recognize the organizational goals and objectives and direct them that how can they achieved these goals.

Human resource management helps to compel satisfaction into staff with the work they have done at the end. Human resource management creates sense into the employees that their organization fully makes them enables to implement key goals. Human resource management also gives sense to employees that they work in a high reliance environment. Human resource management generate an open communication system in which admiration will be given to the unlike view and the result of this is in the form of new and superior thoughts. Human resource management make the people feel that their organization holds them for the advantageous results. Human resource management make the employees feel fully trusted the organization they worked for. Human resource management develops cooperation high trust and high supportive operational associations with departments of the organizations. The costs of recruitment is much high then to educate a new employee and retain or develop an existing employee. Which consequences into the out of sight costs connected with misdirected management separately from this time used up on recruiting actions also waste.  It is reality that the employees are the means of support of every organization. The superior the employees competent, qualified, and managed the more effective and advantageous to the organization is. Human resource management makes input to the organization's competence. Human resource management helps the organizations in productivity improvements. Human resource management helps to direct the succession planning program of the organization. It also helps in administration the talent management program of the organization also helps to manage the career planning and development program of the organizations.  Human resource management plays a fundamental role in mergers and acquisitions programs of the organizations it also offers a market oriented compensation advice. Human resource management helps organizations to develop the organization's hub competencies. .Human resource management leads the way in altering the organization culture  as  the  economy  grows or declines, manages the  claim  for  human resources changes  not  only  in  quantity   but  also  in  quality and types. Human resource management helps to manages the social force and provide the right environment to employees. It also helps to manage the political force to utilize local population, irrespective of skills knowledge. Human resource management manages the official  challenges  to  staffing and compensation  on   inequity .manages  the  technology  changes,   means  getting  right  type of  people or  make available  the  right  type  of training. manages  the  spirited  pressure  to  get  the  right  talent at the  right compensation. Manage the strategic human resources planning and also manage  the  human resource budget  constriction   to get  the  best  resources  for  the  smallest amount. Organization development means human resource implementing new arrangement, culture, systems etc. Job revamp means human resource implementing new methods, procedure, and systems. (Briscoe & Schuler, 2009).


A strategic alliance is a deliberate, formal understanding between two or more parties to pool resources to attain a common set of objectives that assemble critical needs while remaining independent entities. Strategic alliances involve exchange, sharing, or co development of products, services, procedures, and processes.

Changing market conditions intensified global competition and progressively more shorter product life cycles mean that firms are re-examining the traditional methods and strategies for doing business. It is important to note that markets are more fragmented and saturated now. Managers complain that they are not able to gain a sustainable competitive advantage in the marketplace due to strong "commodity magnet". Competitive advantages are now more imitable because of the technological developments and innovations. In this case, humans are the only left core competency for corporations and human resource management could provide a sustainable competitive advantage for corporations in the marketplace. (Ohmae, 1989).

Strategic alliances have grown-up its significance as a means of doing business across national boundaries in receipt of much attention both in the media and in academic circles (Hergert & D.Morris, 1988) .According to Anderson (1990) more international strategic alliances were ongoing between 1981 and 1990 than in all previous years put together. in spite of the popularity of strategic alliances there appears to be a high failure rate. It has been estimated that between 30% and 70% of all alliances fail. It is, therefore, important to understand what characterizes successful and less successful strategic alliances in order that managers, in the future, can develop more effective international partnerships.

The factors influencing success or failure most investigations has focused on the control-performance relationship and less on the behavioral and structural aspects (Killing, 1983). Research in the US has identified a number of factors which appear to have an impact on the success of strategic alliances. These include shared ownership and management, good relationships between partners and good organizational arrangements. L.Bucklin & Sengupta (1989) have undertaken a survey of strategic alliances between UK and Chinese firms and have explored the impact of behavioral, cultural and administrative factors on the management of those 2415 alliances only 21 relationships were explored.


To calculate the performance of international strategic alliances. Performance has been analyzed in terms of financial indicators such as profitability and growth. These trial, however, do not effectively presents the degree to which an international strategic alliance has achieved its short term and long term objectives. For example, an alliance may not, in the first occasion, have been shaped to increase short term profits, but to improve access to foreign markets, to promote technology transfer, to building block competitors or to pool resources for more cost effective, speedy product development (Killing, 1983). Profitability is, therefore, in such cases, a poor indicator of the success of the alliance. in addition, as (Anderson, 1990) notes, financial measures calculate only one aspect of performance and argues that other measures, including qualitative ones, must also be examined in order to better assess the performance of international strategic alliances. This is because, in spite of poor financial performance, the alliance may have achieved its objectives and thus be measured, by the firm's managers, to have been a success. on the other hand (Geringer & L.Herbert, 1989) said that an international strategic alliance may be viewed as unsuccessful despite good financial results. Market share, sales volume and customer satisfaction have also been used to measure the success of strategic alliances (Dussage.P & Garrett.B, 1995). These measurements are, however, classically more problematic than an evaluation of financial performance because objective data is more difficult to obtain. In addition, these measures do not determine the extent to which an alliance has achieved its objectives. Other researchers have, therefore, used the perceptual measure of a partner's satisfaction with the alliance's performance (Killing, 1983). This has the benefit of assessing to what extent the alliance's objectives have been achieved. However, researchers have usually used this perceptual measure in isolation leading to a more subjective estimation of an alliance's performance. Measures of steadiness, duration, continued existence and learning have also been used range of measures of performance including financial indicators such as profitability and return on investment, market success such as market share improvement and customer satisfaction and duration of the alliance and internal measures such as the extent to which the partner's objectives have been achieved.

Strategic alliances offers step for companies to reach new markets, expand geographic, obtain new technology balance improved skills and fast core competencies. The collaborations enable the organization to develop a high quality framework by utilizing less resources and incurring less costs that would be expensive for the organizations if they develop such framework or expertise alone themselves.. Therefore strategic alliances are considered to be value driven and growth oriented. But strategic alliances have certain drawbacks and failures and sometimes it happens that the partnering corporations snatch the value pie of each other in strategic alliances.

Characteristics of successful alliances are as follows.

Corporate practice of Partnering

The structured approach is required for successful alliances and corporate discipline. Organization require to put and place thae process for the main concern of the organizational strategic objective and then recognize the best possible partner for constructing partnership. Top executives vigorous role is needed to guarantee that the ventures reflect the goals and objectives of the organization and meet up the performance standards. Alliances can be successful because of first-class processes, metrics, and corporate supervision.

As a part of the tactical procedure, the portfolio approach for alliances improves the process of value creation for organizations. Managing the alliance portfolio needs the following to be understood:

Focal point for alliances to add the most leverage

Optimal allocation of resources

Opportunities and hazards in the portfolio

Metrics in place and there assessment

worth of portfolio communicated to stakeholders

A structure for achievement

Characteristics that drive the alliance to success

Partners joint commitment for success

Success in financial terms

Strategies of corporations that are reliable for partnership

Company goals that are communicated and fixed upon

Alliance provides needed contributions.

Organizational Compatibility of the Partners

Compatible goals and vision

A need that is common.

Shared values and corporate culture; trust is supreme

Outstanding Communication

History of successful partnering with organizational learning

Good executive level associations

Good business health of partners

Agreement of Mutual Objectives

Common objectives and projected results

Measurable and computable results

Transparency by sharing results as well as threats

Dominant competitive advantage is provided by nut shell strategic alliances provides in new markets, cost, speed, information, and access to technology & expertise. Top management and leadership of the organizations must be committed to success. (Harrigan, 1988)

Human Resource Management Challenges and Organizational Performance

Two types of challenges are faced by HRM today.

The Changing Environment

1. Work force diversity

2. Economical & Technological changes

3. Globalization

4. Organization Restructuring

5. Changing nature of work

Changing Role of the HR Manager

1. Flatter organization

2. Employee empowerment

3. Team work

4. Ethical management

Figure source International Journal of HRM

There is a technological revolution in markets and markets are internationalized rather than localized. This is an era of innovation and development. Different factors such as technology, innovation, globalization, demographics have changed the nature of competition in markets. Competitive advantages are now easily imitable due to the above factors. Therefore, it becomes crucial for an organization to develop a "strategic positioning" or it would vanish otherwise (Dessler.G, 2000). Another big challenges faced by the human resources management is Ethics refers to the attitude of conduct governing an individual or group purposely to the standards you use to decide what your conduct should be.HR activities can impel positive ethical change, and can play a central role in the company ethics efforts . One of the main challenges that human resource managers face now a day's issues of training and developing human capital. As organizations develop, they have to operate in an ever more unified world (Schuler, 2000). Training and development activities are going to support those changes in the future and are necessary to the success of any organizational strategy. In the highly competitive, global market place, the competitive advantage for companies is the quality of their human resources.

Holden (1997) said that the recognition of the significance of training in modern times has been heavily affected by the strengthening of global competition and the relative success of economies like Japan, Germany and Sweden, where investment in employee development is significant. Technological developments and organizational change have gradually led some employers to the recognition that success relies on the skills and abilities of their employees, translating into significant and continuous investment in training and development. This investment also has been underscored by the rise of human resource management with its focus on the importance of people and the skills they possess in ornamental organizational efficiency.

A key feature of the growth of flexible working practices is its role in enabling an organization to meet the diverse needs of its workforce. Flexible working patterns are widely perceived to offer an effective way of combining successfully home and work commitments and to be a stepping stone towards achieving equality of opportunity. The forms it takes have been determined largely by the strategies adopted by the social partners, particularly the employers, given that implementation is their direct responsibility. Generalizations are complicated, but a number of employers have come to assume a bit proactive role in this area. Research evidence suggests a important trend towards greater labor flexibility throughout the 1980s and 1990s (Friedrich et al., 1998). Yet, as the need for greater flexibility is widely accepted, the challenge is to find out how far, how permanently, how strategically, and in whose interests is the achievement of this flexibility in organizations.

All the above challenges cannot be considered outside the context of employee relations. Good employee relations involve providing fair and reliable treatment to all employees so that they will be dedicated to the organization. Companies with good employee relations are likely to have a human resource strategy that places high value on workers as organizational stakeholders. In addition, companies with strong employee relations benefit because their workforce is highly motivated to expend its best efforts (Gomez-Mejia et al., 2001). Corporate culture provides a benchmark of the standards of performance among employees. For example, it can provide clear guidelines on attendance, punctuality, concern about quality, and customer service. A corporate culture that is easily duplicated provides little advantage. The most difficult corporate cultures to copy are those that have evolved over a period to suit the specific needs of an organization. A strong corporate culture is an advantage in the global universe, but it is important to note that cultures are not static. They influence each other. Understanding employee attitudes helps corporate culture take root. Cultures that are sensitive to employee attitudes and customs are jump to be more successful. in addition, the management style of line managers directly affects employee relations, since line managers are vital links to the human resource function and the ones who must arrange the distinctive skills, experiences, personalities, and motives of individuals. Managers also, must make possible the connections within work groups. In their duty, managers provide direction, encouragement, and authority to remind desired behaviors. Adding up, managers reinforce desirable behavior so that it is continued and improved. The manager is an important source of knowledge about the tasks, the organization, and the human resource management policies, programs, and goals. The management approach will influence the human resource programmes in communication and implementation. Similarly, empowerment is another significant part of employee relations. In spirit, empowerment has been adopted by different corporations by providing employees with the skills and power to make decisions that would conventionally made by managers. The aim of empowerment in an organization consisting of passionate, dedicated people who execute their work because they believe in it and enjoy to doing it (Gomez-Mejia, 2001). Another topic directly related to employee relations is industrial relations. A union can change significantly the human resource management policies of a company because of its bargaining power, which is supported by labor law (Gomez-Mejia, 2001). Human resource managers must first possess enough knowledge of basic labor law in order to avoid creating a legal liability for the company, second to implement the terms of labor agreements fairly and impartially, and last to hear and resolve employee grievances (Gomez-Mejia, 2001).


In conclusion, organizational performance is associated with the way human resources are managed in the organizations, which in turn is directly related to the challenges identified for organizations to get better and succeed in their industries they should have to be appropriate and innovative management, particularly for their human resources, to result in both organizational and individual improvements. Today's highly spirited environment demands organizational excellence, an organizational challenge that needs to be addressed with the work of human resources.