Tuesday, May 17, 2011

Explain the changing role of HRM.

Explain the changing role of HRM. Discuss the challenges associated in the HRM in present business scenario citing examples from the organizations you are familiar with. Briefly describe the organization you are referring to.

The Foremost and prime HR function in any organization is recruiting the right person and then getting requisite quality and quantity of work (Read productivity) for a reasonable period of tenure, in line with organizational goals (Do most of organizations and the top HR Bosses themselves know about it?). One can call it Strategic Human Resource Management, which uses various tools and techniques for motivation, appraisal, training, cross cultural management, emerging issues in personnel laws like, sexual harassment and competence mapping, etc. In fact HR function is main responsibility of a supervisor and not of a HR Department, and higher goes the role and scope of responsibilities, higher the supervisor in Organization Hierarchy. In many organizations, for instance, IT industry, one has very loose or flattish hierarchy due to knowledge workers outfit. Over the decades HRM became a separated out function graduating from a simple Time Office function to a high profile Division in organizations until recently when most of HRM functions have been leased out (Outsourced) and what is left with HR departments is Planning and Strategy. But unfortunately the supervisors have abandoned their prime responsibility to manage men and think that this better be taken care of by HR Specialists. This is simply a myth. Increasing globalization and migration of labor in both directions like the financial capital, the challenges of staffing, retention and motivation of highly skilled workers from wider canvass and background and even education background, is really serious issue that better be not ignored by Businesses. My experience in corporate sector in India in various types of organizations ranging from Steels to Textiles, Chemicals and Services sector has been quite amusing and educative as far as the way HR has been handled by various types of entrepreneurs in India right from SBEs to the so called large corporate units. Majority of Indian businesses still treat employees as commodities and expect them to come trained and skilled in specific areas they are hired for (Even in US it is not feasible despite Industry Institutes interface). Hire and fire has been very popular policy in India and suppressing welfare laws regarding labor has been a favorable pass time, and matter of satisfaction & pride for Indian Businessmen. It was often observed by me that rapid expansion of businesses were scarcely accompanied by timely organizational structuring, expansion, training and growth in pace with such expansions and thus most of such expansions fell flat, even destroying their existing business lines and profitability.
The problem with HRM is that one cannot use clear cut formula that can be applied in particular situations due to highly subjective, emotional and cultural deviation amongst the employees. Secondly skilled and committed workers will become more and more scarce commodity due to rapid global expansion of business, high aspiration levels, fast growth mentality of youth including job-hopping, mobility of labor across borders and rapidly changing technologies. This is just too much to handle for traditional HR experts and involvement of Top line functional supervisors is essential for strategic growth of organizations. Indian businesses have a soft belly there due to still continuing contemptuous and casual attitude towards employees. As we move from Time Office to Personnel Management and on to HR Management to Human Asset management to Intellectual Capital paradigms, drastic changes in HR practices and HR organizations in Businesses is inevitable. Another thing to understand is that there is not very strong correlation between wages & incentives and motivation level of employees as is generally thought. Motivation and stability of employees is rather complicated task determined by several volatile factors, for instance, cultural background, family unit, education level and type, age, job satisfaction and so many others still not fully understood. It is another myth of HRM that giving doses of some foreign trip and 50 or 100 hrs of boring and stereotyped training sessions (requirement of TQM, ISO 9000 also) will raise motivation, skills and work style standards of employee. Most important change required is commitment, interest and achievement motivation within framework of organizational goals. One thing is very clear from above discussions that Quality and stability of Employees in organizations is going to be key differentiator and even main foundation for survival of a business in coming times and that too in highly nebulous environment of labor markets.
The third Myth worth mentioning is that employees always work better by giving better facilities, rewards and training sessions. I have found it to be doubtful in most situations. In fact the best way to train and induce employee to work and achieve higher is to create slight stress in work environment and little bit of job in security. As they say, throw the child in waters and it will pick swimming faster- very well applies to all human activities. There is no substitute for experience gained repeatedly by varied situations of decision-making and it is really confounding as to why inexperienced graduates from B-schools colleges are paid unreasonably high wages. Some one may like to deeply probe the issue whether such high remunerations are really effective in extraordinary achievements of organizations? One of the main reason for rise in corruption and materialistic pursuit by public sector employees is envy towards unusually high wage rates in so called hi-fi and MNC organizations around the globe, particularly in countries like India that are having poor quality of Public Administration, public awareness and legal systems. We can see that there is acute crisis facing the HR Managers who are yet to get their own roles re-defined and who have to find or create leaders in multi cultural setting in a highly competitive business environment and tight job market, with very high attrition rates in some sectors, like in Call Centers and software industries, and developing requisite inner motivation levels and soft skills that are often neglected in promotions and wage fixations (Here 'wage' is being used as a generic term for all kinds of compensation structures at all levels). While loyalty can be developed and maintained in employees, I would like to explode fourth Myth in HRM by revealing the fact that loyalty also has frequently roots in ethical, community and genetic background (We may call these attitudes, or inherent attitudes or life positions taken by an employee during initial grooming in young age). There is need to develop yet more effective psychometric tests or procedures to sift the candidates for right combination of IQ, EQ and loyalty index (I would like to find a formula for this term). One big damage globalization has done is to popularize the western materialistic high-growth rate focused employee culture prevalent in US where employees have little emotional concern with organizations they work (Even Japan is fast becoming victim to this epidemic!). Another challenge facing Organizations is to handle legal pressures relating to employee related laws of newer types like gender bias, racial or caste bias in employment, sexual harassment (At least two very senior officials of Indian Organizations have already been charges or accused of this in USA), ethical issues in handling organization information and challenges of multi-ethnic or multi-cultural staffed work places. Work place diversity is a good major of challenge in Organizations. This will grow in near future. According to Thomas (1992), dimensions of workplace diversity include, but are not limited to: age, ethnicity, ancestry, gender, physical abilities/qualities, race, sexual orientation, educational background, geographic location, income, marital status, military experience, religious beliefs, parental status, and work experience. The future success of any organizations relies on the ability to manage a diverse body of talent that can bring innovative ideas, perspectives and views to their work. The challenge and problems faced of workplace diversity can be turned into a strategic organizational asset if an organization is able to capitalize on this melting pot of diverse talents. With the mixture of talents of diverse cultural backgrounds, genders, ages and lifestyles, an organization can respond to business opportunities more rapidly and creatively, especially in the global arena (Cox, 1993), which must be one of the important organizational goals to be attained. A key issue that influences success in international arena is the awareness of cultural differences and thus development of both a business strategy and corresponding HR strategy that is consistent with the culture of host country. The interface between culture of the organization and culture of host country become important. Instead of leaving these issues to be tackled by HR personnel, the senior executives in international business arena have to take the HR strategies and solutions in their own hands. More and more Informational technology is being used in organizations to deliver HR services (Example HRSC of IBM) and a good part of these are being outsourced. This is natural outcome in changing business environment and brings in both advantages of expertise and economics. Large organizations otherwise also cannot cope with information exchange requirements in huge staffed organization in traditional manner unless they follow IBM like I nitiatives. The example of IBM HRSC is an attempt to combine people, technology and customer service, much as it does with its external customers. The center service about 20 business units in areas including benefits, retirement planning, compensation, employee suggestions, staffing, job posting, orientation, performance management, EEO compliance, employee separations, leave of absence, and skill development through 80 customer service representatives. This will be more or less true for all leading organizations in services sector in particular in near future. IBM too had repositioned itself as service driven organization.
Impact of technology can be viewed as challenges in:
- Necessary expansion/contraction of work force.
- Training needed to utilize new technology (A major reason of failures in Indian Small & mid size organizations from 80s to end of 90s)
- Effective change Management
- Impact on work group dynamics and concept of human face
- Costs for hiring, severance, training.
- Unwillingness of entrepreneurs to understand, recognize and adopt technology that can drive productivity, quality, customer satisfaction and new market opportunities.
- Sliming down of organizations particularly at lower levels and reduced hierarchy.
Another Myth of US based HR Practices is non-relevance of old employees or problem of graying workforce. The reason could be higher health care costs and perception of lower productivity. This may be true, but not in all circumstances. The element of loyalty may weigh favorably in favor of older employees as also their vast experience particularly useful in handling crises and negotiations, grievance handling within and outside organizations and networking advantage. I strongly decry the US corporate culture largely derived from social attitudes towards old in devaluing them .One serious disadvantage of old employees is their resistance to change in practices and call of business environment changes. As supply of baby boomers exceeds the demand, HR challenge is to handle this tricky issue including retirement and retraining or rehabilitation plan. INDIA culture simply does not suit Indian culture and ethos and we should not blindly go for INDIA system. HRM will not have to deal only with cultural diversity of employees and organization but also issues of minorities, backward classes and racial preferences in employment. Neither many-grounded theories are available in HR, nor the traditional HR practices will apply to most of organizational settings in coming times.

Traditional HR Versus Strategic HR
Indicator Traditional HR Strategic HR
Responsibility for HR


Role of HR


Time Horizon


Job design

Key investments

Accountability Staff Specialists

Employee Relations

Transactional, Change follower and respondent

Slow, reactive and fragmented


Bureaucratic-roles, policies, procedures

Tight division of labor, independence, specialization

Capital, Products

Cost center Line Managers

Partnership with internal and external customers

Transformational, change leader and initiator

Fast, proactive and integrated

Short, medium, Long (as necessary)

Organic-Flexible, whatever is necessary to succeed

Broad, flexible, cross training, teams

People, knowledge

Investment center

The traditional HR assumes a role of handling transaction as they arise. In India in most of organizations that are still bossed by 60+ adults from orthodox family business background (Babu ji culture), the role of HR personnel is not understood by them and they mostly serve as front for the CEO's decisions ranging from hiring, firing, wages, promotions and all kinds of manipulations. The traditional HR itself branched out as scientific division of labor relieving line managers from highly subjective, time consuming and inconvenient activities related to employee and which were not considered crucial to profit making and growth of organization. Strategic HR plays role of transformational change agent with focus on and in line with long term or strategic goals of organization. To become strategic the HR managers will have to be drawn from general Management rather than specialist training background, have to adopt long term and strategic focus and persuade management to look beyond current performance. Further, most of senior executives including entrepreneurs themselves hardly appreciative benefits and possibility of HRM as strategic partner. In fact most managers view HR with dislike being rule machines that hinder flexibility and carrying out of jobs. It is surprising but true that most senior executives in India as well as owners view human assets as liability and not owned by them and therefore a high-risk investment. HR activities in organizations are mostly taken up to do face lifting and present modernized face of organization because the direct benefits of HR are difficult to see and quantify. The HR and training budgets get axe first when need arises to do so.

No comments:

Post a Comment

Blog Archive