1 MEETING PRESENT AND EMERGING STRATEGIC HUMAN RESOURCE
CHALLENGES
Companies have always competed against each other for talent, attracting, retaining,
motivating, 2 examples:
GOOGLE: google had until 2010 - 2011 no problems hiring people, but it’s nowadays
fighting with the many growing internet firms like Facebook, Twitter, etc. which were
able to increase their number of employees; to attract new recruits, Google gave 10%
raise
MOTOROLA: lost employees in the recent years to Apple, Samsung, etc.
The Managerial Perspective:
- Human Resources is the international accepted term that shows the belief that workers are
a valuable and sometimes irreplaceable resource and is a major component of any
manager’s job
- Human Resources Strategy refers to a firm’s deliberate use of HR to help it gain or maintain
an edge against its competitors in the market place; used to ensure that the effective use of
people leads to accomplishing the objective and mission
- A HR Tactic is a particular policy or program that helps to advance a firm’s strategic goal
Human Resource Management: The Challenges
Managers = in charge of others who are responsible for the timely and correct
execution of action that promotes their units’ successful performance
Line employees = directly involved in producing the company’s goods or delivering
services
Staff employees = support the line function
Senior employees = have been with the company longer and have more
responsibilities than junior employees
Exempt employees = don’t receive extra payment for overtime work
Nonexempt workers = receive overtime compensation
Environmental Challenges
Influence organizational performance but are largely beyond management’s control
-> therefore SWOT regularly
8 most important impacts are: Internet, workforce diversity, globalization, legislation,
evolving work and family roles, skill shortages, rise if the service sector
Examples on how to hinder a firm grappling with external change:
New company town: Line between home and office work is almost blurred;
company started to take the best aspects from home and incorporating them into
work like: take-home meals, concierge service, autocare, laundry service
Dealing with stress: many employees started to work from home to catch up with
everything; employees = stressful, burn-out, etc. which costs the company money
as there is more absenteeism, so they introduced stress-control programs
The Internet Revolution
The Internet has several impacts on managing human resources:
, Necessitating greater written communication skills: e-mail messaging is an important
skill when hiring someone as it is necessary to keep a customer loyal and prevent
them from going to competitors
Dealing with information overflow: Although employees send hours on e-mail service,
they still have a lot of chats, meetings in their office which wastes time
Breaking down labor market barriers: Internet creates open labor market with
information about prospective employees and firms which can be seen and used
globally and for everyone; Disadvantage for recruitment with PC is that it leads
automatically to rejections for small details and the candidates don’t have chances to
make their case
Using online learning: A huge amount of the employees nowadays have training
online
Enabling HR to focus on management: Internet handles details much more quickly
and efficiently
Workforce diversity
Managers are daily confronted with the increasing diversity of the workforce, more
with international background, more women, minority groups
Globalization
The implications of a global economy for human resource management are:
Worldwide company culture: firms try to develop a global company identity to
smooth over cultural differences between domestic employees and international
operations to increase cooperation
Worldwide recruiting: hiring becomes international as, especially in the technology
area, not easy because good employees are high in demand
Industrial metamorphosis: the proportion of labor force in manufacturing has
dropped 10 % because rch-world companies have replaced workers with new
technology to boost productivity and shift production to higher-tech, higher value-
added sectors; within firms, low-skilled jobs have moved offshore
Global alliances: requires a highly trained and devoted staff
A virtual workforce: because of restrictive immigration quotas in the US, firms are
tapping skilled foreign labor but not moving those workers to the US, the Internet
makes this possible with little additional expense
The global enterprise: Internationalization is growing at warp speed, creating a
powerful new reality
Wage competition: businesses found new ways to navigate this new world of
technology change and globalization, the blue collar workers lose their jobs
Legislation: means keeping track of the external legal environment and developing
internal system to ensure compliance and minimize complains; legislation may be
differed between public (governmental agencies) and private-sector organizations (all
types of organizations)
Evolving work and family roles: Proportion of dual-career families (husband and wife
are working) increases every year -> companies introduce family-friendly programs
that give them competitive advantages in the labor market
Skill shortages and the rise of the service sector: Employment in the service sector
increases, especially professional specialties and technical occupations
, Natural disasters: Because of tsunamis, hurricanes etc. people might get affected on
that, bc their houses were destroyed, they are unreachable, can’t go to work, etc.;
firm has to deal with it, employ short term workers, etc.
Collapse of the housing market: 2011-2012 houses in Florida, Arizona, etc. dropped
their prices by 50% -> problem for firms to hire employees beyond the local areas,
relocation costs are immense, take employees within driving distance
Organizational Challenges
Are problems or concerns internal to a firm; being proactive is important which means to
handle a problem before it gets out of hands
Competitive Position: Cost, quality or distinctive capabilities
How effectively a firm uses its HR has effects o its ability to compete in an increasingly
competitive environment; HR policies can affect an organization’s competitive position by
controlling costs, improving quality and creating distinctive capabilities
Controlling costs: uses innovative rewards strategies to control labor costs can help
the organization to grow or including making better employee selection decisions,
train employees to make them more efficient and productive
Improving quality: Many companies have implemented total quality management
(TQM, is an organization-wide approach to improve the quality of all the processes
that lead to a final product or service) to improve the quality of all the processes that
lead to a final product or service
Creating distinctive capabilities: use people with distinctive capabilities to create
unsurpassed competence in a particular area
Decentralization
Decentralization transfers responsibilities and decision-making authority from a central office
to people and locations closer to the situation that demands attention; the Internet helps the
communication flow to go faster among the workforce
Downsizing
Downsizing = reduction of the workforce which becomes a standard business practice, even
though there were firm which had a ‘no layoff’ policy
Organizational restructuring
Changes in the structure of a firm; tall organizations have many management levels which
becomes flatter as companies reduce the number of people between the CEO and the
lowest-ranking employee in an effort to become more competitive
Self-managed work teams
Traditional system in which individual employees report to a single boss is being replaced in
some organizations by self-managed work teams; they are assigned to a group of peers and
together, they are responsible for a particular area or task -> increases effectiveness and
improvement in quality, productivity and response time
, The growth of small businesses
There is an increasing number of people who start their own business which has positive
consequences on the economy as they pay taxes, employ people, etc.
Ethics
How to interpret and using information about current and prospective employees can be
easily uncovered through the Web, examples:
With only name and e-mail address it’s possible with a few time to find out the
address, Social security number, hometown and more personal details
Every movement is collected into a database
Electronic monitoring: Many companies are using sophisticated software that
monitors when, how and why workers are using the Internet, mostly for evidence
when something occurs like sexual harassment, discrimination, etc.
Medical testing: Genetic testing, high-tech imaging and DNA will be soon available for
the employment decision making process and to find the ideal person for a job
position
An increase in equalitarianism: power and authority is spread more widely among all
employers
Internal security: more security in employment, employers introduced taking finger
prints, scanning the eyes and identify if the employee is a potential threat
Data security: Numerous cases of unauthorized access to private data have been
revealed during the past decade, in some situations leading to a widespread identity
fraud
Outsourcing: large firms shift work once performed internally to outside suppliers and
contractors which is called ‘outsourcing’; helps companies to slash costs, employees
may face layoffs when their jobs are farmed out to the lowest addition, customers’
dissatisfaction can result if subcontractors are not carefully watched and evaluated;
small businesses may not receive the best available service and support
Product integrity: The extent to which firms can effectively monitor the integrity of
products or subcomponents a=that are made in foreign countries is an issue whoch
brings a lot of media attention
Individual Challenges
Often reflect what is happening in the larger organization; there is a two two-way
relationship between organizational and individual challenges in which relationship goes only
one way, e.g. when many key employees leave the firm to competitors, the organization’s
competitive position is affected; the most important individual challenges are matching
people and organizations, ethics and responsibilities, productivity and empowerment, brain
drain and job security
Matching people and organizations:
Firms use these strategies to attract and retain the type of employee whi best fits in the
firm’s culture and overall business objectives
Ethics and social responsibility
People’s fear that their employers will behave unethically are increasing so much that many
firms have created codes of ethics outlining principles and standards of personal conduct for
their members but theses codes often don’t meet the expectations of employer behavior;
CHALLENGES
Companies have always competed against each other for talent, attracting, retaining,
motivating, 2 examples:
GOOGLE: google had until 2010 - 2011 no problems hiring people, but it’s nowadays
fighting with the many growing internet firms like Facebook, Twitter, etc. which were
able to increase their number of employees; to attract new recruits, Google gave 10%
raise
MOTOROLA: lost employees in the recent years to Apple, Samsung, etc.
The Managerial Perspective:
- Human Resources is the international accepted term that shows the belief that workers are
a valuable and sometimes irreplaceable resource and is a major component of any
manager’s job
- Human Resources Strategy refers to a firm’s deliberate use of HR to help it gain or maintain
an edge against its competitors in the market place; used to ensure that the effective use of
people leads to accomplishing the objective and mission
- A HR Tactic is a particular policy or program that helps to advance a firm’s strategic goal
Human Resource Management: The Challenges
Managers = in charge of others who are responsible for the timely and correct
execution of action that promotes their units’ successful performance
Line employees = directly involved in producing the company’s goods or delivering
services
Staff employees = support the line function
Senior employees = have been with the company longer and have more
responsibilities than junior employees
Exempt employees = don’t receive extra payment for overtime work
Nonexempt workers = receive overtime compensation
Environmental Challenges
Influence organizational performance but are largely beyond management’s control
-> therefore SWOT regularly
8 most important impacts are: Internet, workforce diversity, globalization, legislation,
evolving work and family roles, skill shortages, rise if the service sector
Examples on how to hinder a firm grappling with external change:
New company town: Line between home and office work is almost blurred;
company started to take the best aspects from home and incorporating them into
work like: take-home meals, concierge service, autocare, laundry service
Dealing with stress: many employees started to work from home to catch up with
everything; employees = stressful, burn-out, etc. which costs the company money
as there is more absenteeism, so they introduced stress-control programs
The Internet Revolution
The Internet has several impacts on managing human resources:
, Necessitating greater written communication skills: e-mail messaging is an important
skill when hiring someone as it is necessary to keep a customer loyal and prevent
them from going to competitors
Dealing with information overflow: Although employees send hours on e-mail service,
they still have a lot of chats, meetings in their office which wastes time
Breaking down labor market barriers: Internet creates open labor market with
information about prospective employees and firms which can be seen and used
globally and for everyone; Disadvantage for recruitment with PC is that it leads
automatically to rejections for small details and the candidates don’t have chances to
make their case
Using online learning: A huge amount of the employees nowadays have training
online
Enabling HR to focus on management: Internet handles details much more quickly
and efficiently
Workforce diversity
Managers are daily confronted with the increasing diversity of the workforce, more
with international background, more women, minority groups
Globalization
The implications of a global economy for human resource management are:
Worldwide company culture: firms try to develop a global company identity to
smooth over cultural differences between domestic employees and international
operations to increase cooperation
Worldwide recruiting: hiring becomes international as, especially in the technology
area, not easy because good employees are high in demand
Industrial metamorphosis: the proportion of labor force in manufacturing has
dropped 10 % because rch-world companies have replaced workers with new
technology to boost productivity and shift production to higher-tech, higher value-
added sectors; within firms, low-skilled jobs have moved offshore
Global alliances: requires a highly trained and devoted staff
A virtual workforce: because of restrictive immigration quotas in the US, firms are
tapping skilled foreign labor but not moving those workers to the US, the Internet
makes this possible with little additional expense
The global enterprise: Internationalization is growing at warp speed, creating a
powerful new reality
Wage competition: businesses found new ways to navigate this new world of
technology change and globalization, the blue collar workers lose their jobs
Legislation: means keeping track of the external legal environment and developing
internal system to ensure compliance and minimize complains; legislation may be
differed between public (governmental agencies) and private-sector organizations (all
types of organizations)
Evolving work and family roles: Proportion of dual-career families (husband and wife
are working) increases every year -> companies introduce family-friendly programs
that give them competitive advantages in the labor market
Skill shortages and the rise of the service sector: Employment in the service sector
increases, especially professional specialties and technical occupations
, Natural disasters: Because of tsunamis, hurricanes etc. people might get affected on
that, bc their houses were destroyed, they are unreachable, can’t go to work, etc.;
firm has to deal with it, employ short term workers, etc.
Collapse of the housing market: 2011-2012 houses in Florida, Arizona, etc. dropped
their prices by 50% -> problem for firms to hire employees beyond the local areas,
relocation costs are immense, take employees within driving distance
Organizational Challenges
Are problems or concerns internal to a firm; being proactive is important which means to
handle a problem before it gets out of hands
Competitive Position: Cost, quality or distinctive capabilities
How effectively a firm uses its HR has effects o its ability to compete in an increasingly
competitive environment; HR policies can affect an organization’s competitive position by
controlling costs, improving quality and creating distinctive capabilities
Controlling costs: uses innovative rewards strategies to control labor costs can help
the organization to grow or including making better employee selection decisions,
train employees to make them more efficient and productive
Improving quality: Many companies have implemented total quality management
(TQM, is an organization-wide approach to improve the quality of all the processes
that lead to a final product or service) to improve the quality of all the processes that
lead to a final product or service
Creating distinctive capabilities: use people with distinctive capabilities to create
unsurpassed competence in a particular area
Decentralization
Decentralization transfers responsibilities and decision-making authority from a central office
to people and locations closer to the situation that demands attention; the Internet helps the
communication flow to go faster among the workforce
Downsizing
Downsizing = reduction of the workforce which becomes a standard business practice, even
though there were firm which had a ‘no layoff’ policy
Organizational restructuring
Changes in the structure of a firm; tall organizations have many management levels which
becomes flatter as companies reduce the number of people between the CEO and the
lowest-ranking employee in an effort to become more competitive
Self-managed work teams
Traditional system in which individual employees report to a single boss is being replaced in
some organizations by self-managed work teams; they are assigned to a group of peers and
together, they are responsible for a particular area or task -> increases effectiveness and
improvement in quality, productivity and response time
, The growth of small businesses
There is an increasing number of people who start their own business which has positive
consequences on the economy as they pay taxes, employ people, etc.
Ethics
How to interpret and using information about current and prospective employees can be
easily uncovered through the Web, examples:
With only name and e-mail address it’s possible with a few time to find out the
address, Social security number, hometown and more personal details
Every movement is collected into a database
Electronic monitoring: Many companies are using sophisticated software that
monitors when, how and why workers are using the Internet, mostly for evidence
when something occurs like sexual harassment, discrimination, etc.
Medical testing: Genetic testing, high-tech imaging and DNA will be soon available for
the employment decision making process and to find the ideal person for a job
position
An increase in equalitarianism: power and authority is spread more widely among all
employers
Internal security: more security in employment, employers introduced taking finger
prints, scanning the eyes and identify if the employee is a potential threat
Data security: Numerous cases of unauthorized access to private data have been
revealed during the past decade, in some situations leading to a widespread identity
fraud
Outsourcing: large firms shift work once performed internally to outside suppliers and
contractors which is called ‘outsourcing’; helps companies to slash costs, employees
may face layoffs when their jobs are farmed out to the lowest addition, customers’
dissatisfaction can result if subcontractors are not carefully watched and evaluated;
small businesses may not receive the best available service and support
Product integrity: The extent to which firms can effectively monitor the integrity of
products or subcomponents a=that are made in foreign countries is an issue whoch
brings a lot of media attention
Individual Challenges
Often reflect what is happening in the larger organization; there is a two two-way
relationship between organizational and individual challenges in which relationship goes only
one way, e.g. when many key employees leave the firm to competitors, the organization’s
competitive position is affected; the most important individual challenges are matching
people and organizations, ethics and responsibilities, productivity and empowerment, brain
drain and job security
Matching people and organizations:
Firms use these strategies to attract and retain the type of employee whi best fits in the
firm’s culture and overall business objectives
Ethics and social responsibility
People’s fear that their employers will behave unethically are increasing so much that many
firms have created codes of ethics outlining principles and standards of personal conduct for
their members but theses codes often don’t meet the expectations of employer behavior;
