The Challenge of Human Resource Management 1 Matakuliah: J0124-Manajemen Sumber Daya Manusia Tahun : 2010

The Challenge ofHuman Resource Management

1

Matakuliah : J0124-Manajemen Sumber Daya ManusiaTahun : 2010

PowerPoint Presentation by Charlie CookThe University of West Alabama

PowerPoint Presentation by Charlie CookThe University of West Alabama

12

Learning Outcomes

After studying this chapter, the students should be able to :

• Identify how firms gain a sustainable competitive advantage through people

• Explain how globalization is influencing HRM

Bina Nusantara University 4

Why Study Human Resources ManagementWhy Study Human Resources Management

•Human Resources Management (HRM)Human Resources Management (HRM) The process of managing human resources The process of managing human resources

(human capital and intellectual assets) to (human capital and intellectual assets) to achieve an organization’s objectives.achieve an organization’s objectives.

•““Why Study HRM?”Why Study HRM?” Staffing the organization, designing jobs and Staffing the organization, designing jobs and

teams, developing skillful employees, teams, developing skillful employees, identifying approaches for improving their identifying approaches for improving their performance, and rewarding employee performance, and rewarding employee successes—all typically labeled HRM issues—successes—all typically labeled HRM issues—are as relevant to line managers as they are to are as relevant to line managers as they are to managers in the HR department.managers in the HR department.

© 2010 South-Western, a part of Cengage Learning. All rights reserved

FIGURE

1.1Overall Framework for Human Resources Management

© 2010 South-Western, a part of Cengage Learning. All rights reserved.

Competitive Challenges and Competitive Challenges and Human Resources ManagementHuman Resources Management

•The most pressing competitive issues The most pressing competitive issues facing firms:facing firms: Competing, recruiting, and staffing globallyCompeting, recruiting, and staffing globally Embracing new technologyEmbracing new technology Managing changeManaging change Managing talent, or human capital Managing talent, or human capital Responding to the market Responding to the market Containing costsContaining costs


Challenge 1: Competing, Recruiting, and Challenge 1: Competing, Recruiting, and Staffing GloballyStaffing Globally

•GlobalizationGlobalization The trend toward opening up foreign markets The trend toward opening up foreign markets

to international trade and investmentto international trade and investment

• Impact of GlobalizationImpact of Globalization ““Anything, anytime, anywhere” marketsAnything, anytime, anywhere” markets Partnerships with foreign firmsPartnerships with foreign firms Lower trade and tariff barriersLower trade and tariff barriers

NAFTA, EU, APEC trade agreementsNAFTA, EU, APEC trade agreements WTO and GATTWTO and GATT


Challenge 1…(cont’d)Challenge 1…(cont’d)

•Corporate Social Responsibility (CSR)Corporate Social Responsibility (CSR) The responsibility of the firm to act in the best The responsibility of the firm to act in the best

interests of the people and communities interests of the people and communities affected by its activitiesaffected by its activities

•Globalization’s Impact on HRMGlobalization’s Impact on HRM Different geographies, cultures, laws, and Different geographies, cultures, laws, and

business practicesbusiness practices Issues:Issues:

Identifying capable managers and workersIdentifying capable managers and workers Developing foreign culture and work practice training Developing foreign culture and work practice training

programs.programs. Adjusting compensation plans for overseas workAdjusting compensation plans for overseas work


Challenge 2: Embracing New TechnologyChallenge 2: Embracing New Technology

•Knowledge WorkersKnowledge Workers Workers whose responsibilities extend beyond Workers whose responsibilities extend beyond

the physical execution of work to include the physical execution of work to include planning, decision making, and problem planning, decision making, and problem solving.solving.

•Knowledge-Based TrainingKnowledge-Based Training Online instructionOnline instruction ““Just-in-time” learning via the Internet Just-in-time” learning via the Internet

on company intranetson company intranets Virtual learningVirtual learning


Influence of Technology in HRMInfluence of Technology in HRM

•Human Resources Information System (HRIS)Human Resources Information System (HRIS) A computerized system that provides current and A computerized system that provides current and

accurate data for the purposes of control and accurate data for the purposes of control and decision making.decision making.

Benefits:Benefits: Automation of routine tasks, lower administrative costs, Automation of routine tasks, lower administrative costs,

increased productivity and response times.increased productivity and response times. Self-service access to information and training for Self-service access to information and training for

managers and employeesmanagers and employees Online recruiting, screening, and pretesting of applicantsOnline recruiting, screening, and pretesting of applicants Training, tracking, and selecting employees based on Training, tracking, and selecting employees based on

their record of skills and abilitiestheir record of skills and abilities Organization-wide alignment of “cascading” goalsOrganization-wide alignment of “cascading” goals


2Automation of Talent Management Functions


HRM IT Investment FactorsHRM IT Investment Factors

• Fit of the application to Fit of the application to the firm’s employee the firm’s employee base.base.

• Ability to upgrade Ability to upgrade Increased efficiency Increased efficiency and time savings and time savings

• Compatibility with Compatibility with current systemscurrent systems

• Availability of technical Availability of technical supportsupport

• Time required to Time required to implement and train implement and train staff members to use staff members to use HRISHRIS

• Initial and annual Initial and annual maintenance costsmaintenance costs

• Training time required Training time required for HR and payrollfor HR and payroll


Challenge 3: Managing ChangeChallenge 3: Managing Change

•Types of ChangeTypes of Change Reactive changeReactive change

Change that occurs after external forces have already Change that occurs after external forces have already affected performanceaffected performance

Proactive changeProactive change Change initiated to take advantage of targeted Change initiated to take advantage of targeted

opportunitiesopportunities

•Managing Change through HRManaging Change through HR Formal change management programs help to Formal change management programs help to

keep employees focused on the success of the keep employees focused on the success of the business.business.


Challenge 3: Managing Change (cont’d)Challenge 3: Managing Change (cont’d)

•Why Change Efforts Fail:Why Change Efforts Fail: Not establishing a sense of urgency.Not establishing a sense of urgency. Not creating a powerful coalition to guide the Not creating a powerful coalition to guide the

effort.effort. Lacking leaders who have a vision.Lacking leaders who have a vision. Lacking leaders who communicate the vision.Lacking leaders who communicate the vision. Not removing obstacles to the new vision.Not removing obstacles to the new vision. Not systematically planning for and creating Not systematically planning for and creating

short-term “wins.”short-term “wins.” Declaring victory too soon.Declaring victory too soon. Not anchoring changes in the corporate culture.Not anchoring changes in the corporate culture.


Challenge 4: Managing Talent, or Human CapitalChallenge 4: Managing Talent, or Human Capital

•Human CapitalHuman Capital The knowledge, skills, and capabilities of The knowledge, skills, and capabilities of

individuals that have economic value to an individuals that have economic value to an organization.organization.

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


Challenge 5: Responding to the MarketChallenge 5: Responding to the Market

•Total Quality Management (TQM)Total Quality Management (TQM) A set of principles and practices whose core A set of principles and practices whose core

ideas include understanding customer needs, ideas include understanding customer needs, doing things right the first time, and striving doing things right the first time, and striving for continuous improvement.for continuous improvement.

•Six SigmaSix Sigma A process used to translate customer needs A process used to translate customer needs

into a set of optimal tasks that are performed into a set of optimal tasks that are performed in concert with one another.in concert with one another. HR facilitates organizational development of Six HR facilitates organizational development of Six

Sigma.Sigma. HR helps balance the opposing needs for order and HR helps balance the opposing needs for order and

control with the needs for growth and creativity.control with the needs for growth and creativity.© 2010 South-Western, a part of Cengage Learning. All rights reserved

Challenge 5: Responding to the Market Challenge 5: Responding to the Market (cont’d)(cont’d)•Reengineering and HRMReengineering and HRM

Fundamental rethinking and radical redesign of Fundamental rethinking and radical redesign of business processes to achieve dramatic business processes to achieve dramatic improvements in cost, quality, service, and improvements in cost, quality, service, and speed.speed. Requires that managers create an environment for Requires that managers create an environment for

change.change.

Depends on effective leadership and communication Depends on effective leadership and communication processes.processes.

Requires that administrative systems be reviewed Requires that administrative systems be reviewed and modified.and modified.


Challenge 6: Containing CostsChallenge 6: Containing Costs

•DownsizingDownsizing The planned elimination of jobs (“head count”).The planned elimination of jobs (“head count”). LayoffsLayoffs

•OutsourcingOutsourcing Contracting outside the organization to have Contracting outside the organization to have

work done that formerly was done by internal work done that formerly was done by internal employees.employees.

•Offshoring (Global Sourcing)Offshoring (Global Sourcing) The business practice of sending jobs to other The business practice of sending jobs to other

countries.countries.


Challenge 6: Containing Costs (cont’d)Challenge 6: Containing Costs (cont’d)

•Hidden Costs of a LayoffHidden Costs of a Layoff Severance and rehiring costsSeverance and rehiring costs

Accrued vacation and sick day payoutsAccrued vacation and sick day payouts

Pension and benefit payoffsPension and benefit payoffs

Potential lawsuits from aggrieved workersPotential lawsuits from aggrieved workers

Loss of institutional memory and trust in Loss of institutional memory and trust in managementmanagement

Lack of staffers when the economy reboundsLack of staffers when the economy rebounds

Survivors who are risk-averse, paranoid, and Survivors who are risk-averse, paranoid, and politicalpolitical



•Benefits of a No-Layoff PolicyBenefits of a No-Layoff Policy A fiercely loyal,more productive workforceA fiercely loyal,more productive workforce

Higher customer satisfactionHigher customer satisfaction

Readiness to snap back with the economyReadiness to snap back with the economy

A recruiting edgeA recruiting edge

Workers who aren’t afraid to innovate, knowing Workers who aren’t afraid to innovate, knowing their jobs are safe.their jobs are safe.


FIGURE

1.2Estimated Number and Types of U.S. Jobs Estimated to Move Offshore between 2010 and 2015



•Employee LeasingEmployee Leasing The process of dismissing employees who are The process of dismissing employees who are

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


FIGURE

1.3Productivity Enhancements


Demographic and Employee ConcernsDemographic and Employee Concerns

•Demographic ChangesDemographic Changes More diverse workforceMore diverse workforce

Ethnic and cultural challengesEthnic and cultural challenges

Aging workforceAging workforce More educated workforceMore educated workforce

Necessity of basic skills Necessity of basic skills trainingtraining

•Managing DiversityManaging Diversity Being aware of Being aware of

characteristics common to characteristics common to employees, while also employees, while also managing employees as managing employees as individualsindividuals


3Social Issues in HRM

Changing Demographics: The coming decades will bring a more diverse and aging workforce to developed countries such as the United States. This has major implications for all aspects of HRM because it alters traditional experience and expectations regarding the labor pool. Among the issues in this area are:

• Globalization • Diversity strategies• Shrinking pool of skilled entry-level workers • Social Security and retirement issues• Rising health care costs for employees • Continual skills development and retraining• Outsourcing, offshoring, and the use of temporary and part-time employees

Employer/Employee Rights: This area reflects the shift toward organizations and individuals attempting to define rights, obligations, and responsibilities. Among the issues here are:

• Relationship employment versus transactional-based employment• Concern for the privacy of employees • Whistle-blowing • Comparable worth• Employer-employee ethics • Legal compliance • Mandated benefits

Attitudes toward Work and Family: Because of the increase of working women as well as employee mobility and a growing concern about family issues, there is demand for recognizing and supporting family-related concerns. Among the issues are:

• Day care and elder care • Parental leave • Flextime • Telecommuting• Alternative work schedules • Job sharing • Job rotation


FIGURE

1.4Composition of U.S. Population


FIGURE

1.5Labor Force and Gender Distributions


FIGURE

1.6Education Pays


FIGURE

1.7Model of Diversity Management Strategy


4Why Diversity?

The primary business reasons for diversity management include . . .


Jobs and Organizations

Jobs and Organizations

Employee Rights

Employee Rights

Concern for Privacy

Concern for Privacy

Attitudes towards Work

Attitudes towards Work

Balancing Work and Family

Balancing Work and Family

Impact of Cultural ChangesImpact of Cultural Changes


Qualities of HR ManagersQualities of HR Managers

• ResponsibilitiesResponsibilities1.1. Advice and counselAdvice and counsel

2.2. ServiceService

3.3. Policy formulation Policy formulation and and implementationimplementation

4.4. Employee advocacyEmployee advocacy

• CompetenciesCompetencies1.1. Business masteryBusiness mastery

2.2. HR masteryHR mastery

3.3. Change masteryChange mastery

4.4. Personal credibilityPersonal credibility© 2010 South-Western, a part of Cengage Learning. All rights reserved

FIGURE

1.8Human Resource Competency Model


Documents

The Challenge of Human Resource Management 1 Matakuliah: J0124-Manajemen Sumber Daya Manusia Tahun : 2010