Chapter 1
HRM in a Changing Environment
Human Resources Management, 3rd Grade
The current chapter is going to discuss:
• Human resource management.
• How cultural environments affect human
resource management (HRM) practices.
• How technology is changing HRM.
• How Diversity Affects HRM.
• HRM implications of a labor shortage.
• Continuous Improvement Programs.
• Challenges for HRM.
• The importance of ethics in an organization.
Introduction
▪ Human resource management (HRM) is a subset of the study of management
that focuses on how to attract, hire, train, motivate, and maintain employees.
▪ Strong employees become a source of competitive advantage in a global
environment facing change in complex ways at a rapid pace.
▪ As part of an organization, HRM must be prepared to deal with the effects of
these changes. This means understanding the implications of globalization,
technology changes, workforce diversity, labor shortages, changing skill
requirements, continuous improvement initiatives, the contingent workforce,
decentralized work sites, company mergers, offshore sourcing of goods and
services, and employee involvement.
▪ Let’s look at how these changes are affecting HRM goals and practices in
organizations functioning in a global environment.
Introduction
HRM is a subset of management. It has five main
goals:
attract
employees
retain hire
Goals employees
employees
of
HRM
motivate train
employees employees
Strong employees = competitive advantage.
Human resource management
• Human Resource Management is a management
function concerned with hiring, motivating,
maintaining workforce, training, development,
compensation, communication, and administration.
Human resource management ensures satisfaction of
employees and maximum contribution of employees
to the achievement of organizational objectives.
• According to Armstrong (1997), Human Resource
Management can be defined as “a strategic approach
to acquiring, developing, managing, motivating and
gaining the commitment of the organization's key
resource – the people who work in and for it.”
Basic Functions of Human Resource
Management
Human Resource Management functions can
be classified in following two categories.
• Managerial Functions
• Operative Functions
Understanding Cultural Environments:
As part of the rapidly changing environment, organizational members face the
globalization of business. Organizations are no longer constrained by national
borders in producing goods and services.
• Globalization A process of interaction and integration among the people,
companies, and governments of different nations, driven by international trade
and investment, accelerated by information technology.
• multinational corporations (MNCs) Corporations with significant operations in
more than one country. some companies, including Fiat, Ford, Unilever, and
Royal Dutch/Shell, had gone multinational.
Understanding Cultural Environments
HRM operates in a global business environment.
Countries have different
➢ values
➢ morals
➢ customs
➢ political, economic, and legal systems
HRM helps employees understand other countries’
political and economic conditions.
The Changing World of Technology:
➢ Technology is having a major impact on HRM. It’s giving all employees
instant access to information and changing the skill requirements of
employees. Technological changes have required HRM to address or
change its practices when it deals with such activities as recruiting and
selecting employees, motivating and paying individuals, training and
developing employees, and in legal and ethical matters.
• knowledge workers Individuals whose jobs are designed around the
acquisition and application of information, depends on the ability to use
computer technology to locate and use information for decision making.
How Technology Affects HRM Practices
Technology has had a positive effect on internal operations for organizations,
but it also has changed the way human resource managers work.
HRM professionals have become the primary source of information in many
organizations. Information can quickly and easily be communicated via company
Web sites and intranets, e-mail, and messaging.
Human Resource Information Systems (HRIS) allow HRM professionals to better
facilitate human resource plans, make decisions faster, clearly define jobs, evaluate
performance, and provide cost effective benefits that employees want.
Technology helps to strengthen communications with both the external community
and employees.
Technology affect HR practices as follow:
1. Recruiting : Contacting a pool of qualified applicants is one of the most critical
aspects of recruiting. Word of mouth, newspaper advertisements, and college visits
are often supplemented or replaced altogether by job postings on the Internet.
Posting jobs on company web sites, or through specific job-search web sites such as
[Link] and [Link], help human resource managers reach a larger
pool of potential job applicants.
2. Employee Selection : Hiring good people is particularly challenging in technology
based organizations because they require a unique brand of technical and professional
skills. Employees must be smart and able to survive in the demanding cultures of
today’s dynamic organizations. In addition, many such “qualified” individuals are in
short supply and may be offered a number of opportunities for employment. Once
applicants have been identified, HRM must carefully screen final candidates to ensure
they fit well into the organization’s culture. Many Internet tools make background
searches of applicants quick and easy.
Technology affect HR practices as follow:
3. Training and Development : Technology is also dramatically changing how human
resource managers orient, train, and develop employees and help them manage their
careers. The Internet has provided HRM opportunities to deliver Web based training.
Teleconferencing technology allows employees to train and collaborate in groups
regardless of their location. Organizations that rely heavily on technology find an
increased need for training. Online training and teleconferencing also allow HR
departments to deliver cost effective training that help stretch the HR budget.
4. Ethics and Employee Rights : Electronic surveillance of employees by
employers is an issue that pits an organization’s desire for control against an
employee’s right to privacy. The development of increasingly sophisticated
surveillance software only adds to the ethical dilemma of how far an organization
should go in monitoring the behavior of employees who work on computers.
Today, most businesses surveyed by the American Management Association
indicate that they monitor employees.
Technology affect HR practices as follow:
5- Skill Levels : What are the skill implications of this vast spread of technology?
For one, employees’ job skill requirements will increase. Workers will need the
ability to read and comprehend software and hardware manuals, technical
journals, and detailed reports. Another implication is that technology tends to
level the competitive playing field. It provides organizations, no matter their size
or market power, with the ability to innovate, bring products to market rapidly,
and respond to customer requests.
6- Communications: The rules of communication are being rewritten as
information technology creates more opportunities for communication. Instantly
anytime, with anyone, anywhere. These open communication systems break
down historical organizational communication pattern flows. They also redefine
how meetings, negotiations, supervision, and water-cooler talk are conducted. For
instance, virtual meetings allow people in geographically dispersed locations to
meet regularly.
Workforce Diversity
The challenge, here, is to make organizations more accommodating to diverse
groups of people by addressing different lifestyles, family needs, and work styles.
The melting-pot assumption is being replaced by recognition and celebration of
differences. Interestingly, those organizations who do celebrate differences are
finding their profits to be higher.
• workforce diversity The varied personal characteristics that make the
workforce heterogeneous or different mix of males and females, whites and
people of color, many ethnic and religious groups, the disabled, and the elder,
to avoid discrimination.
How Diversity Affects HRM
As organizations become more diverse, employers have been adapting their
human resource practices to reflect those changes. Many organizations today,
such as Bank of America and Merck Pharmaceuticals, have workforce diversity
programs.
Workforce diversity requires employers to be more sensitive to the differences
that each group brings to the work setting. They must recognize and deal with
the different values, needs, interests, and expectations of employees. They must
avoid any practice or action that can be interpreted as being discrimination,
racist, or offensive to any particular group and, of course, must not illegally
discriminate against any employee. Employers also must find ways to assist
employees in managing work/life issues and quality.
HRM implications of a labor shortage
For HRM, the labor shortage means that human resource managers will need
sophisticated recruitment and retention strategies and have a better understanding
of human behavior like:
- Downsizing: An activity in an organization aimed at creating greater efficiency by
eliminating certain jobs.
- Rightsizing : Linking employee needs to organizational strategy.
- Outsourcing : Sending work “outside” the organization to be done by individuals
not employed full time with the organization.
- Contingent workforce : The part-time, temporary, and contract workers used by
organizations to fill peak staffing needs or perform work not done by core
employees. Contingent workers have become an important resource as HR
struggles to balance the supply of workers available, yet maintain cost control.
Part-time, temporary, and contract workers are valuable to many organization.
The Labor Supply
HR managers monitor the labor supply.
Trend is to rightsize: fit company goals to
workforce numbers.
For agility, companies build a contingent
workforce of
➢ part-time workers
➢ temporary workers
➢ contract workers
Continuous Improvement Programs
A quality revolution continues in both the private and the public sectors. The
generic terms that describe this revolution are quality management or
continuous improvement.
- Quality management : Organizational commitment to continuous process
of improvement that expands the definition of customer to include
everyone involved in the organization.
- Continuous improvement Organizational commitment to constantly
improving quality of products or services.
- kaizen The Japanese term for an organization’s commitment to continuous
improvement.
Continuous Improvement Programs
focus
on
customer
concern for
empowerment continuous
of employees continuous improvement
improvement
components
accurate concern for
measurement total quality
HR managers help workers adapt to continuous improvement changes
through retraining, providing answers, and monitoring expectations.
Employee Involvement
It’s all about employee empowerment through
involvement, which increases worker productivity
and loyalty.
Employee Involvement Concepts
delegation • participative management
work teams • goal setting • employer training
Challenges for HRM:
➢ The recession has brought layoffs and low morale.
➢ Increased offshoring means jobs can move
overseas, even HR.
➢ Today’s spate of mergers and acquisitions
increase HR’s role.
- Merger: means joining ownership of two organizations.
- Acquisition : The transfer of ownership and control of one
organization to another.
Fundamentals of Human
Resource Management,
10/e, DeCenzo/Robbins
The importance of ethics in an organization
Ethics : refers to a set of rules or principles that defines right and
wrong conduct..
Code of ethics : refers to a formal document that states an
organization’s primary values and the ethical rules it expects
organizational members to follow.
