Olivia Edge Hr Notes

Editor's Notes

1. Staff: Designing org structures Aligning Employee contracts with org requirements Recruiting, selecting and training staff Rewarding ee’s appropriately to retain their services Disposing of those who no longer have the reqd skills Performance: Once staff are on board, this considers how they can be kept motivated to perform their roles Training and development of staff is crucial Where necessary, disciplining staff may be required to ensure equity amongst the workforce Welfare functions are also important to support ee’s who are having personal difficulties that may affect their work e.g. illness, bereavement HR tries to create an environment that induces ee discretionary effort i.e. work longer, hard, enthusiastically Management Control systems e.g. value systems, belief systems, boundary control systems (Diagnostic, Boundary, Interactive) Change Management Change is continuous in the org Sometimes its structural e.g. restructuring activities, hiring new skill sets, Sometimes its cultural e.g. changing the values, attitudes toward org norms e.g. greater need to innovate as opposed to simply refine strategy HR are responsible for recruiting change leaders and agents that will direct and drive acceptance for change Also they must adjust the training, development and incentives to redirect activity in a meaningful way Engaging ee;s in the change process to create greater mindshare and facilitate id of discrepancy, appropriateness, efficacy and valence
2. By understanding and anticipating the fundamental aims of the org and then reacting appropriately through the people better than the competition Maintaining advantage by developing and maintaining human capital – knowledge, skills and abilities of ee’s combined with their experience is a unique form of competitive advantage in the knowledge environment. Its easy to replicate codified information but it is not easy to replicate the unique way that people apply their KSA with their experience to solve business problems. HR must facilitate this through the structures of the org Grow and maintain the reputation and corporate image of the co. as a co. that is well lead, managed with loyal and satisifed ee’s. This attracts investors and the highest calibre ee’s which in turn create new opportunities for the org to grow This is achieved through ethical recruitment, selection and maintenance practices – no discrimiation, fair and equitable work practices High corporate social responsibility – give something back to the community
3. This first lecture provides a broad overview of the strategic human resource challenges organizations face, and provides a framework to understand the role of human resource strategies, activities, and programs to achieve sustained competitive advantage. To support this broad perspective, some of the most important external and internal challenges vis-à-vis HR strategies are discussed in three categories: environmental challenges, organizational challenges, and individual challenges. The chapter explains the planning and implementation of strategic HR policies, as well as the role of line managers and the HR department in the effective use of human resources. Also explored here is how managers, in partnership with human resource professionals, adopt and implement HR strategies through specific strategies and programs. HR professionals are often responsible for designing these programs in order to meet business goals and employee needs. While the line managers provide the necessary input during the program design phase, they are primarily responsible for carrying out or implementing such programs. This chapter provides a strong overview of how firms can use HR strategies and initiatives to deal with external and internal challenges which are then explored in detail in later lectures.
4. Three types of HR challenges facing managers today: - Environmental - forces external to the firm - Organizational – concerns or problems internal to the firm - Individual – deal with decisions pertinent to specific employee Human Resource Management: The Challenge Human resource challenges that face today’s managers may be categorized according to their primary focus: the environment, the organization, or the individual. Firms that deal with these challenges effectively are likely to outperform those that do not.   A. Environmental Challenges   Environmental challenges refer to forces external to the firm that are largely beyond management’s control but influence organizational performance. They include: rapid change, the Internet revolution, workforce diversity, globalization, legislation, evolving work and family roles, and skill shortages and the rise of the service sector.   B. Organizational Challenges   Organizational challenges refer to concerns that are internal to the firm. However, they are often a byproduct of environmental forces because no firm operates in a vacuum. These issues include: competitive position (cost, quality, and distinctive capability), decentralization, downsizing, organizational restructuring, self-managed work teams, small businesses, technology, outsourcing, and organizational culture.   Organizational culture is a particularly important element. Culture is the basic assumptions and beliefs shared by members of the organization that express themselves through the rules, norms, dominant values, philosophy, and climate. Firms that regularly make adjustments to these elements to match environmental changes are likely to outperform those whose culture is rigid and unresponsive to external factors.   C. Individual Challenges   Human resource issues at the individual level address concerns that are most pertinent to decisions involving specific employees. These issues almost always reflect what is happening in the larger organization. How individuals are treated also is likely to have an effect on organizational issues. For instance, if many key employees leave a firm to join its competitor, it will affect the competitive posture of the firm. The individual issues include matching people and organization, ethics and social responsibility, productivity, empowerment, brain drain, and job insecurity.   Lecturer: Olivia Edge
5. Environmental challenges: - influence organizational performance - largely beyond management’s control - managers need to monitor the external environment for opportunities and threats The speed of change in the market environment is bringing a level of hyper competition This is being caused by Move towards globalisation of economic activity and move towards higher privitisation Greater pressure to sell goods internationally therefore the competition for those markets is growing Becoming more difficult maintain no 1 position and dominate national markets through state owned businesses To accommodate this level of competition, global corporations and strategic alliances are forged e.g. Microsoft, Sony Ericsson, Trade alliances e.g. WTO etc is reducing protectionism and increasing free trade 2. Rise of Technology Developments in technology, auotomation, are revolutionising how orgs work Staying ahead of the pace of change is driving orgs to adopt new practices, and develop and use technology in a more efficient and effective way IT and e-business is opening up the barriers to competitions as its easier to compare products, features, price etc Labour market trends are critical to understand for global orgs so they situate in the correct markets to deliver certain parts of the product offering e.g. manufacturing in china, R&D in France etc. So what drives those decisions? Answer, an analysis of the skills in each market. Some markets are extremely good at certain things therefore it creates a tightening in the market environ which drives competition for the skilled labour. This means HR must work hard to attract skilled labour and retain them so they can continue to derive sustainable competitive advantage. Regulation of EE rights. Its no longer acceptable to manage ee;s through their COE alone. ER’s must be mindful of their statutory obligations which supersede COEs Ers are obliged to honour certain ee conditions e.g. equal pay, unlawful dismissal, health and safety, So how does this affect HRM? HR needs to ready people for change and create org flexibility Put practices in place to accommodate the changes and keep people trained which drives efficacy Adjust reward schemes (tangible and intangible) to accommodate valence (what’s in it for me) Lecturer: Olivia Edge
6. Organizational challenges: - e ffective managers spot organizational issues and deal with them before they become major problems - important for firms to be proactive , to take action before problems get out of hand - can be done only by managers who are well informed about important HR issues and organizational challenges - the relationship between environmental and organizational challenges is a one way relationship (see Figure 1.1) - few organizations have much impact on the environment Lecturer: Olivia Edge
7. I ndividual challenges: - almost always reflect what is happening in the larger organization - how the company treats its individual employees is also likely to affect the organizational challenges discussed - e.g. if many key employees leave the firm to join competitors, the organization’s competitive position is affected - there is a two-way relationship between organizational and individual challenges (see Fig 1-1) Psychological contract is NB here. This refers to the ‘delivery of a deal’ that is fair and that fulfills the expectations and obligations of both the ee and er. Lecturer: Olivia Edge
8. Formulating HR strategies and establishing programs to implement them is strategic human resource planning. Successful HR strategic planning provides many benefits for the company, including (1) encouraging proactive rather than reactive behavior, (2) explicit communication of company goals, (3) stimulation of critical thinking and ongoing examination of assumptions, (4) identification of gaps between current situation and future vision, (5) encouragement of line managers’ participation, (6) identification of HR constraints and opportunities, and (7) creation of common bonds. Lecturer: Olivia Edge
9. In developing HR strategy, organizations face several important challenges including maintaining a competitive advantage, (2) reinforcing overall business strategy, (3) avoiding excessive concentration on day-to-day problems, (4) developing HR strategies suited to unique organizational features, (5) coping with the environment, (6) securing management commitment, (7) translating the strategic plan into action, (8) combining intended and emergent strategies, and (9) accommodating change. Lecturer: Olivia Edge
10. Human resource strategies, which are implemented through HR activities and programs, may affect the performance of the business. The options that a firm has available in designing its HR system are its strategic HR choices This slide shows a sampling, rather than an exhaustive list, of strategic HR choices. Firms may fall near the left, right, or middle of such a continuum Work Flows – efficiency & control vs. innovation & flexibility Staffing – internal with supervisor making hiring decisions vs. external and HR dept makes hiring decisions Employee Separations – voluntary inducements & preferential hiring policy vs. layoffs & no preferential treatment Performance Appraisal – customized & developmental vs. uniform & control-oriented Training & Career Development – individual, OTJ & job-specific vs. team-based, external & generic Compensation – fixed or job- based pay vs. variable or individual- based pay Employee Rights – emphasis on discipline & informal ethical standards vs. emphasis on prevention & explicit ethical standards Employee & Labor Relations – top down communication & union suppression vs. use of feedback & union acceptance International Management – crate global company culture with universal company policies vs. adapt to local cultures and country-specific policies Lecturer: Olivia Edge
11. No HR strategy is “good” or “bad” in and of itself. The success of HR strategies depends on the situation or context in which they are used. In other words, an HR strategy’s effect on firm performance is always dependent on how well it fits with some of the factors. Fit refers to the consistency or compatibility between HR strategies and other important aspects of the organization.     .   .   Lecturer: Olivia Edge
12. A. Fit with Organizational Strategies   Organizational strategies may be examined at two levels: corporate and business.   Corporate strategy refers to the mix of businesses a corporation decides to hold and the flow of resources among those businesses. This involves decisions pertaining to acquisition, divestment, diversification, and growth. At one end of the spectrum is the evolutionary business strategy; at the other end is the steady-state strategy.   Business unit strategies refer to those established by firms or autonomous units of the corporation. Well-known business strategies were formulated by Porter (overall cost leadership strategy, differentiation business strategy, and focus strategy) and Miles and Snow (defender strategy and prospector strategy). Evolutionary – aggressive acquisitions of new businesses, even if unrelated - HR emphasis on flexibility, quick response, entrepreneurship, risk sharing, and decentralization Steady state – avoid acquiring firms outside their industry or companies that are very different from them - HR emphasis on efficiency, control, centralization and long-term career development of employees Cost leadership – gain competitive advantage through lower costs - HR emphasis on efficient, low-cost production, highly structured procedures, and discourages creativity and innovation Differentiation - create a product or service that is perceived as being unique - HR emphasis on innovation, flexibility, and renewal of the workforce by attracting new talent from other firms Focus – combines low cost and differentiation to serve narrow target market better than other firms - HR emphasis would be cross between those described for low-cost producers and differentiators Defender – conservative business units that prefer to maintain a secure position in relatively stable product or service areas - HR emphasis on control and structure, and policies designed to foster long-term employee attachment Prospector – interested in growth and innovation, development of new products, and an eagerness to be the first in new-product or market areas - HR emphasis policies that foster creativity and adaptability, staffing and employee separation policies that focus on the external labor market; customized, participative employee appraisals used for multiple purposes (including employee development); training strategies targeting broad skills; and a decentralized compensation system that rewards risk taking and performance. Lecturer: Olivia Edge
13. B. Fit with the Environment   HR strategies should help the organization better exploit environmental opportunities or cope with the unique environmental forces that affect it. The environment can be examined on four dimensions, including degree of uncertainty, (2) volatility, (3) magnitude, and (4) complexity. If high on 4 dimensions – need HR strategies that promote flexibility, adaptivity, quick response, transferability of skills, the ability to secure external talent when needed, and risk sharing with employees (variable pay) If low on the 4 dimensions – need HR strategies that allow for an orderly, rational, and routine approaches to dealing with a relatively predictable and stable environment Lecturer: Olivia Edge
14. C. Fit with Organizational Characteristics   To be effective, HR strategies must be tailored to the organization’s personality. The features of an organization’s personality are its production process for converting inputs into output, (2) market posture, (3) overall managerial philosophy, (4) organizational structure, and (5) organizational culture If production is routine, market is stable, the org. is highly structured and management’s philosophy & culture emphasize control and are averse to risk, HR strategies should emphasize control and stability Lecturer: Olivia Edge
15. D. Fit with Organizational Capabilities   An organization’s capabilities are its distinct competencies. HR strategies make a greater contribution to a firm’s performance when they help to exploit the firm’s specific advantages or strengths while avoiding its weaknesses, and (2) when they assist in better using its own unique blend of human resource skills and assets E. Choosing Consistent and Appropriate HR Tactics to Implement HR Strategies   Even the best-laid strategic HR plans may fail when specific HR programs are poorly chosen or implemented. A firm’s HR strategies must be mutually consistent. That is, HR strategies are more likely to be effective if they reinforce one another rather than work at cross-purposes. Lecturer: Olivia Edge
16. Lecturer: Olivia Edge