trends and issues in human resource management

By: Jasmin P Comoda

TRENDS AND ISSUES IN HRM

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Introduction

As businesses move forward in 2013 looking for newer growth avenues in a sluggish economy, leaders are increasingly banking on talent to achieve this growth.

While business demands, margin pressures, declining budgets, HR technology, social media, data and analytics are all reshaping the contours of HR, what is noteworthy is an increase in HR’s focus on these aspects.

Traditional ways of doing things are being re-examined as HR leaders look at more effective ways of managing and aligning talent with the new business objectives.

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Introduction

The role of HR is changing fast as technology and the global marketplace.

The positive result of these changes is that HR professionals have the opportunity to play a more strategic role in the business.

The challenge for HR managers is to keep with the latest HR innovations-technical and legal.

How HR manager can anticipate and address some of the most challenging issues.

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Overall Framework for Human Resource Management

COMPETITIVECHALLENGES

• Globalization• Technology• Managing

change• Human capital• Responsiveness• Cost

containment

COMPETITIVECHALLENGES

• Globalization• Technology• Managing

change• Human capital• Responsiveness• Cost

containment

HUMAN RESOURCES

• Planning• Recruitment• Staffing• Job design• Training/

development• Appraisal• Communications• Compensation• Benefits• Labor relations

HUMAN RESOURCES

• Planning• Recruitment• Staffing• Job design• Training/

development• Appraisal• Communications• Compensation• Benefits• Labor relations

EMPLOYEECONCERNS

• Background diversity

• Age distribution• Gender issues• Educational levels• Employee rights• Privacy issues• Work attitudes• Family concerns

EMPLOYEECONCERNS

• Background diversity

• Age distribution• Gender issues• Educational levels• Employee rights• Privacy issues• Work attitudes• Family concerns

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Current Trends in HRM

1. Globalization

2. Technology

3. Managing change

4. Human capital

5. Responsiveness

6. Cost containment

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Globalization

The trend toward opening up foreign markets to international trade and investment.

Impact of Globalization Partnerships with foreign firms “Anything, anywhere, anytime” markets Lower trade and tariff barriers

NAFTA, EU, APEC trade agreementsWTO and GATT

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Globalization

Impact on HRM Different geographies, cultures, laws,

and business practices Issues:

Identifying capable expatriate managers.

Developing foreign culture and work practice training programs.

Adjusting compensation plans for overseas work.

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Embracing New Technology

1. Use of technology to communicate with employees

Company intranets

E-Newsletters

Company emails

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Embracing New Technology2. A move toward single software platforms

Integrated Human Resource Information System (HRIS)

PeopleSoft

SAP

Oracle

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Embracing New Technology Human Resources Information System (HRIS)

is a system that lets you keep track of all your employees and information about them. It is usually done in a database or, more often, in a series of inter-related databases.

Benefits: Store and retrieve of large quantities of data. Combine and reconfigure data to create new

information. Institutionalization of organizational knowledge. Easier communications. Lower administrative costs, increase productivity and

response times.

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Embracing New Technology

Specialized applications

Succession planning

Applicant tracking

Job evaluation

Employee performance evaluation

Grievance handling

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Embracing New Technology3. Evolution of new technologies

Employee Self-Service and Data Exchange

Capability to maintain personal data

View context-specific information

Initiate benefits transactions

Internet-based tools are quickly becoming the preferred method for employees to execute benefits transactions

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Benefits of Automated Benefit Administration

Reducing and eliminating extensive manual efforts formerly needed to:

Distribute, collect, and process forms Test programming required to export/import

data Administer the periodic data exchanges Reconcile data Resolve employees’ problems resulting from

the time lag between data collection and processing

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Manage the Changing Workforce1. Increased diversity in the

workforce Creating workplace that respects and includes

differences Recognizing unique contributions individuals

with differences can make Creating work environment that maximizes

potential of all employees

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Manage the Changing Workforce

2. Work-life balance Employees experiencing burnout due to

overwork and increased stress – in nearly all occupations

Rise in workplace violence, increase in levels of absenteeism as well as rising workers’ compensation claims

Causes range from personal ambition and the pressure of family obligations to the accelerating pace of technology

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Manage the Changing Workforce Work-life balance According to study by Center for Work-Life Policy, 1.7

million people consider their jobs and work hours excessive

50% of top corporate executives leaving current positions 64% of workers feel work pressures are “self-inflicted”,

and taking a toll In the US, 70%, and globally, 81%, say jobs are affecting

their health. Between 46% and 59% of workers feel stress is affecting

their interpersonal and sexual relationships. Males feel there is stigma associated with saying “I can’t

do this”

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Manage the Changing Workforce3. Structural shift from the manufacturing

to the service sector Growth in part-time employment Rising prominence of women in the workforce Gradual aging of labor force with fewer young

people entering workforce and participation rates among older workers increasing

Growing importance of temporary employment and self employment

Adoption of flexible working practices, such as job sharing and the increasing opportunity to work from home.

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Human Capital The knowledge, skills, and capabilities of

individuals that have economic value to an organization.

Valuable because capital: Is based on company-specific skills. Is gained through long-term experience. Can be expanded through development.

Developing Human Capital

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1. Managing talent – recruitment, development, and retention of the best workers

Employers need to find innovative ways to “brand” themselves, setting them apart from competitors and becoming an “employer of choice”

As talent becomes scarce, development of current employees for promotional opportunities

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2. Labor shortage – finding the right talent

Statistic: By 2020, gap between available and required skilled workers is projected to be 14 million

Use of e-recruiting and non-traditional labor pools

Establishing selection system geared to retention: better skills assessment, knowledge, and fit for jobs

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Developing Human Capital3. Higher ethical standards

Greater focus on trust and integrity at all levels

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Responding to the Market

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Total Quality Management (TQM)

TQM is a companywide effort to continuously improve the ways people, machines, and systems accomplish work.

The TQM approach provides guidelines for all the organization’s activities, including HRM.

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TQM Core Values

Methods and processes are designed to meet the needs of internal and external customers.

Every employee in the organization receives training in quality.

Quality is designed into a product or service so that errors are prevented from occurring.

The organization promotes cooperation with vendors, suppliers, and customers to improve quality and hold down costs.

Managers measure progress with feedback based on data.

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Mergers and Acquisitions

HRM should have a significant role in carrying out a merger or acquisition. Differences between the businesses

involved in the deal make conflict inevitable.

Training should include developing conflict resolution skills.

There is a need to sort out differences in the two companies’ practices with regard to compensation, performance appraisal, and other HR systems.

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Reengineering

A complete review of the organization’s critical work processes to make them more efficient and able to deliver higher quality.

Involves reviewing all the processes performed by all the organization’s major functions. This includes human resources

management.

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Reengineering

Reengineering affects human resource management in two ways:1. The way the HR department itself

accomplishes its goals may change dramatically.

2. The fundamental change throughout the organization requires the HR department to help design and implement change so that all employees will be committed to the success of the reengineered organization.

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Cost Containment

Downsizing The planned elimination of jobs (“head count”).

Outsourcing Contracting outside the organization to have

work done that formerly was done by internal employees.

Employee Leasing The process of dismissing employees who are

then hired by a leasing company (which handles all HR-related activities) and contracting with that company to lease back the employees.

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Downsizing

Downsizing is reducing the number of employees on the operating payroll. Some users distinguish downsizing from a layoff , with downsizing intended to be a permanent downscaling and a layoff intended to be a temporary downscaling in which employees may later be rehired. Businesses use several techniques in downsizing, including providing incentives to take early retirement and transfer to subsidiary companies, but the most common technique is to simply terminate the employment of a certain number of people.

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Outsourcing

The practice of having another company (a vendor, third-party provider, or consultant) provide services.

Outsourcing gives the company access to in-depth expertise and is often more economical as well.

HR departments help with a transition to outsourcing.

Outsourcing includes both foreign and domestic contracting, and sometimes includes offshoring or relocating a business function to another country.

Financial savings from lower international labor rates is a big motivation for outsourcing/offshoring.

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Cost Containment

Hidden Costs of Layoff Severance and rehiring costs Accrued vacation and sick day payouts Pension and benefit payoffs Potential lawsuits from aggrieved

workers Loss of institutional memory and trust in

management Lack of staffers when the economy

rebounds Survivors who are risk-averse, paranoid,

and political

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Cost Containment

Benefits of a No-Layoff Policy A fiercely loyal,more productive

workforce Higher customer satisfaction Readiness to snap back with the

economy A recruiting edge Workers who aren’t afraid to innovate,

knowing their jobs are safe.

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Issues in HRM

An Aging Workforce

A Diverse Workforce

Skill Deficiencies of the Workforce

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An Aging Workforce

HR professionals will spend much of their time on concerns related to retirement planning, retraining older workers, and motivating workers whose careers have reached a plateau.

Organizations will struggle with ways to control the rising costs of health care and other benefits.

Many of tomorrow’s managers will supervise employees much older than themselves.

Organizations will have to find ways to attract, retain, and prepare the youth labor force.

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A Diverse Workforce

Workplace diversity refers to the variety of differences between people in an organization. That sounds simple, but diversity encompasses race, gender, ethnic group, age, personality, cognitive style, tenure, organizational function, education, background and more. Diversity not only involves how people perceive themselves, but how they perceive others. Those perceptions affect their interactions.

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A Diverse Workforce

For a wide assortment of employees to function effectively as an organization, human resource professionals need to deal effectively with issues such as communication, adaptability and change. Diversity will increase significantly in the coming years. Successful organizations recognize the need for immediate action and are ready and willing to spend resources on managing diversity in the workplace now.

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Benefits of Workplace Diversity An organization's success and competitiveness

depends upon its ability to embrace diversity and realize the benefits.

Increased adaptability Organizations employing a diverse workforce

can supply a greater variety of solutions to problems in service, sourcing, and allocation of resources. Employees from diverse backgrounds bring individual talents and experiences in suggesting ideas that are flexible in adapting to fluctuating markets and customer demands.

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Benefits of Workplace Diversity Broader service range A diverse collection of skills and experiences (e.g.

languages, cultural understanding) allows a company to provide service to customers on a global basis.

Variety of viewpoints A diverse workforce that feels comfortable

communicating varying points of view provides a larger pool of ideas and experiences. The organization can draw from that pool to meet business strategy needs and the needs of customers more effectively.

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Benefits of Workplace Diversity More effective execution Companies that encourage diversity in

the workplace inspire all of their employees to perform to their highest ability. Company-wide strategies can then be executed; resulting in higher productivity, profit, and return on investment.

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Challenges of Diversity in the Workplace

Communication Perceptual, cultural and language barriers need to

be overcome for diversity programs to succeed. Ineffective communication of key objectives results in confusion, lack of teamwork, and low morale.

Resistance to change There are always employees who will refuse to

accept the fact that the social and cultural makeup of their workplace is changing. The "we've always done it this way" mentality silences new ideas and inhibits progress.

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Challenges of Diversity in the Workplace

Implementation of diversity in the workplace policies

This can be the overriding challenge to all diversity advocates. Armed with the results of employee assessments and research data, they must build and implement a customized strategy to maximize the effects of diversity in the workplace for their particular organization.

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Skill Deficiencies of the Workforce Today, employers

are looking for: mathematical

skills verbal skills interpersonal

skills computer skills

The gap between skills needed and skills available has decreased companies ability to compete.

They sometimes lack the capacity to upgrade technology, reorganize work, and empower employees.

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Social Issues and HRM

Changing Demographics Shrinking pool of entry-level workers Productivity Individual differences Retirement benefits Social Security contributions Skills development Use of temporary employees

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Employer/Employee Concerns Job as an entitlement Right to work Whistle-blowing Employment at will AIDS Comparable worth Concern for privacy Mandated benefits

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Attitudes Toward Work and Family Day care Flextime Job sharing Alternative work schedules Elder care Job rotation Parental leave Telecommuting