HR as strategic Partner is gaining momentum as being one of the best way yet in making human resources as the most important asset in an organization. “Being a strategic partner” is understood as a long-term relationship to achieve defined objectives common to all partners. In the context of strategic human resource management, the HR function and activities are intended to ensure the organization’s financial success. As partners your HR people and employees in the various areas of the organization’s operations must not get in the others’ way. Partners do not hinder one another. They support each other to achieve common objectives.
This includes business objectives. It is said that the implementation of “HR strategic partnership is not easy. ” HR people may hinder its implementation. A strategic plan will ensure that your people will carry out their own specific role in their assigned area of operation in partnership with other employees. This is part of your HR as strategic partner plan. Why make HR as Organizational Strategic Partner… Some of the reasons may sound familiar to you. These include: * To increase productivity of the labor force and thus, profitability of the organization * Competency and talent management Onset of information technology and the vast amount of knowledge used in the course of the activities of organizations * The changing business environment * Effect of globalization on the business landscape Provision of Human Resource Services It is through effective delivery of human resource services that you can make human resource as strategic partner. Use a simple approach, make effective use of technology, and either serve most of your customers or serve a particular sector exceptionally well. All of us are aware that customers include both internal and external customers. Strive to serve both well.
In the case of internal customers, concentrate on employees at the strategic and tactical levels. Make sure HR is involved at both levels. If not, there is not much that HR can contribute towards improving organizational performance. But it does not mean we ignore employees at the operational level. Serve well those involved in the day-to-day operations of the organization that are closest to where the money is. These are the employees whose activities generate revenue for your organization. It is necessary that you identify these positions and the employees holding those positions. Translating Business Strategy Into Action
You make HR as strategic partner when and if HR spendmore time in the organization’s planning, design and development. Your organization does this in order to achieve its mission and objectives. HR must become part of the business team, involved in planning at the highest level. Changes in HR management are inevitable. HR Managers and HR professionals are in the strategic position in providing the leadership in change management. Enhance the position of HR as strategic partner by ensuring that teamwork exists in your organization. The Human Resource Manager is the key person in ensuring that people play a strategic role in the organization.
In activities carried out by the HR department, working in cooperation with each other and every member of the workforce is essential. This can help your organization to succeed in achieving its plans. Making HR as Strategic Partner * Make effective use of your Human Resource Information System (HRIS) to handle daily administrative HR tasks. Employees can make use of the self-service facility online. This saves time and reduces costs. * Fully involve your human resource in HR system development that is supportive of business strategy development and implementation.
This promotes ownership. * Appoint an HR Head who understands well the strategic partnership relationship between organizational strategy and human resource. It is said that someone who is an expert in every aspect of the HR function will ‘fit the bill’. But, you may not easily find someone of this caliber. You may have to identify someone from within your organization and groom him or her for this important role. * In a knowledge economy, HR has an opportunity to become a strategic partner. Knowledge and information are required to formulate, implement and review strategies.
Decide to become a knowledge organization. The Human Resource Function and Your Strategic Business Plan It was shown in a survey that there is a correlation between being strategic business partner and the effectiveness of the HR function. You require strategic HR management to ensure that your HR function can fully support the achievement of business objectives. The administrative reactive approach in people management can no longer support your organization in an increasingly competitive business environment. What about Decentralizing your HR Function? Never allow full decentralization.
Line managers and supervisors resent it and will put the blame on HR when problems arise. And if you do so, it interferes with the effective use of line managers’ and supervisors’ time in the day-to-day operations of the organization. Give line managers and supervisors HR accountability, not responsibility. And give them undivided support in order to make them more proficient in managing their subordinates in the performance of daily tasks. Strategy Development and Implementation Full participation of HR people in strategy development and implementation promotes HR as strategic partner.
Ensure that your HR Manager and HR professionals: * contribute to business decisions * develop business acumen to understand how a profitable business is run * are customer-oriented * learn how to link HR practices to your organizational business strategy What are Required of HR as Strategic Partner These are among the important ones. * Recruiting the right employees. Align corporate values to your recruitment strategy. * Well-developed competencies of the workforce, and their relevance to organizational core business. * Participative culture where HR initiatives fully support the overall strategic plan. Effective use of information technology. * Effective leadership through appointment of the right HR Head. * Identification of human resource practices that make HR as strategic partner, namely, serving the business needs of your organization. Discard ineffective HR practices that do not contribute to the success of your organization. Continuous Improvement HR management requires continuous improvement to ensure it retains its relevance as strategic partner. Capable and committed people are needed at every level in order for this to happen.
Senior management support is crucial to ensure that human resource becomes your organization’s strategic partner. It is said that nothing changes except change itself. Change is inevitable for the continued success of your organization. Manage them well to avoid or minimize disruption in your organization’s activities. Other Pre-Conditions The effectiveness of your people as HR as strategic partner is also dependent upon your existing corporate policies and practices, structures, the types of activities you carry out, the location, effective communication, and the business environment.
Review every aspect of HR in the process of implementing the necessary changes and reorganization. Having the right leadership is crucial to success. Provide the necessary leadership and support to your employees at every level. Motivate them and engage their full attention with the view to ensure HR truly becomes strategic partner. And always remember, effective and on-going communication is crucial to ensure that everything is understood by every employee at every level. And that things keep moving in the right direction according to plan. Measurement of HR Contribution
The things already stated are important. But there is an important matter that needs attention. You may ask, “How do I know whether my HR function is playing its role? ” Implement an HR performance measurement such as the HR Scorecard. This can show whether your organization is well on the road to making HR as strategic partner. What is an HR Scorecard? Read some good books by experts such as “The HR Scorecard: Linking People, Strategy, and Performance” by Brian E. Becker, Mark A. Huselid and Dave Ulrich. Enhancement of Competitive Advantage
By doing these things, you can increase the competitive advantage of your organization through the alignment of human resource strategies to your overall business plan. This goes towards strengthening the importance of HR as strategic partner. It goes without saying that effective leadership skills at various levels in your organization, including HR, is vital to corporate success. This is the type of leadership that drives the success of organizations. HR Budget In order to ensure that HR truly becomes strategic business partner, adequate financial back is necessary. Strategic Human Resource Management and Business Strategy
Strategic Human Resource management helps to identify the business strategy that you can adopt. For example, you implement an effective training and performance improvement plan to improve customer service. More satisfactory customer service will bring in more revenue. You can use this superior performance to determine the rewards. This, in turn, motivates your employees to perform better. Learning and skills improvement forms a necessary part of improving human resource management both on the part of employees and management. The 7 S of HRM attempts to simplify the important characteristics of human resource management.
Thereafter, conduct a more in-depth examination. Perhaps the 7S of HRM can simplify some of the things about human resource management. So what are the 7S of HRM? 1. Strategic-ally-linked to the organization’s Mission and Objectives 2. Standard-based, that is, people management is benchmarked against current “best HR practices” that serve as performance measures 3. Systematic, that is, sound and clearly-defined HR policy, well-planned systems and procedures aimed at achieving strategic HR objectives while, at the same time, complying with the law 4.
Stretching people in the performance of their duties and responsibilities on a daily basis in order to achieve service excellence 5. Strengthening the ability and competencies of employees and the capability and capacity of organizations to accomplish defined targets 6. Stress-tested capability, ability and leadership skills of the management team, and 7. Sustaining high employee and organizational productivity on a continuous basis based on TQM standards The linking of HR strategies to the accomplishment of HR objectives and the overall organizational objectives is the most crucial part of strategic human resource management.
The ultimate purpose is to provide excellent service resulting in high productivity which can lead to high profitability. These include strategic recruitment, strategic compensation, strategic employee training and development, employee motivation and retention, strategic performance management, choosing the right technology to support systems and people, and effective handling of workplace conflicts. In essence, strategies are used in every aspect of human resource management and management of the business activities of the organization.
You may consider the 7S of HRM as one of the simplest way of trying to understand what strategic human resource management is and what it entails. The 7S of HRM is intended to help you start on the road to the further probing of every important aspect of strategic human resource management. According to the latest research coming out of leading professional services company Towers Watson, the common misconception that HR exists solely as a hiring and firing function is being laid to rest as more companies are realising the positive – and negative – impact that HR can have on effective business strategy and financial performance.
Its 2010 HR Service Delivery Survey of nearly 500 large and mid-size companies around the world has shown that in 2010 organisations updated and implemented their systems as part of a long-term effort to streamline their HR service delivery approaches and processes, believing that this would increase cost-effectiveness exponentially. The good news for these businesses is that the results proved their efforts worthwhile. Not only were a great number of HR service delivery initiatives undertaken by these organisations, but they also delivered the desired results, with most initiatives often meeting, but also exceeding, expectations.
Erna Oldenbloom, who runs the short course “HR as a Strategic Business Partner” at the University of Cape Town’s Graduate School of Business, said that “HR managers are increasingly being expected to become value-adding strategic business partners, as companies seek to extract maximum value from organisational functions during these tighter economic times. ” Oldenbloom said that in the current environment, businesses expect HR managers to consider what their business does in the market, who its clients are, and how HR can feed into the company’s strategic aims. Increasingly HR managers are realising that they need to affect a shift in thinking as the companies that hire them are recognising the value-adding potential they possess,” she said. Sunil J Ramlall, President of HR consulting firm, Strategic HRM Consulting, echoed Oldenbloom’s sentiments, saying that “today’s dynamic and complex business environment signifies the need for an organization to constantly evaluate its environment, both internal and external, for challenges and opportunities, so that they can stay relevant with a competitive business strategy for sustainable growth. However, while HR acknowledges its need for evolution, the discipline still believes that there are barriers that are inhibiting it from taking the central strategic role that it should play. According to a 2011 survey, conducted by Mercer, of 500 HR directors across Africa, Europe and the Middle East, while HR professionals do perceive their department as a strategic partner, only 15% of their time is allocated to related strategic activities.
According to Brad McCaw, a Principal at Mercer and co-author of the Mercer report, “this gap in perception and activities can be addressed by investing in the skills and training of HR staff, while also increasing awareness and people management skills among line management, to ensure their activities encompass not only the day-to-day work that needs to be done, but also support the strategic direction of the business. Measurement and analysis are also vital. Oldenbloom has brought in experts from the US and South Africa to give the “HR as a Strategic Business Partner” programme the expertise and insight needed to address these issues, offering a unique blend of local and international perspectives. These experts include Kalpana Mistry, Chief Administrative Officer and Senior Vice President of Human Resources at VITAS Innovative Hospice Care in the US, and Ezanne Swanepoel of local people and leadership development organisation, Connemara.
Mistry, who was honoured by the Society of Human Resource Management with a National Human Capital Business Leader of the Year Award in 2007, is credited with lifting HR to strategic partner status at her organisation and will share these first-hand experiences with delegates on the programme. The UCT GSB course will run through the School’s Executive Education department, which was recently placed 53rd in the Financial Times customised education programmes ranking. The course is aimed at experienced HR professionals, consultants and managers who want to improve their strategic HR skills.
HR as a strategic partner is something that many people have written about, many organizations talk about, and few companies actually achieve. Below, we discuss some of the variety of reasons why HR departments fail to become a management strategic partner, but if people really are an organization’s most important asset, then this is a problem that requires attention urgently. Why Care about HR? Why should organizations care about having an HR strategic partner? In many cases HR is viewed a necessary evil in a company, and is simply part of the overhead cost of doing business.
This is the case in poorly run companies that do not have HR as a strategic partner. There are no world-class companies with weak HR departments. Excellence requires great HR, or an HR strategic partner. Here are some other reasons to strive create an organization that has an HR strategic partner: * Employees are expensive, and good leadership/management maximizes the value of organization’s investment in people. * Great HR has better firm performance* * 63% less unwanted turnover * 400% greater sales per employee * Over 3 times greater Market Value:Book Value *Becker, Brian E. Mark A. Huselid and Dave Ulrich, The HR Scorecard – Linking People, Strategy and Performance (Harvard Business School Press, Boston, Mass. 2001) Top 10 Reasons HR Often Sucks There are a variety of reasons that people become frustrated with their HR departments. Here are our Top 10 reasons why organizations end up without an HR Strategic Partner: 1. Organizations don’t know what they want/need from HR. As companies evolve and grow, the focus of HR and what management needs them to do changes. Often, there is no thought given to what are the key drivers of human performance.
Being an HR strategic partner requires a clear understanding of what the HR group will do, and what they will not do. 2. In the absence of clear direction, HR is reduced to arranging picnics and Christmas parties. Because there is no direction from the organization, the HR group ends up becoming a “catch-all” where all the administrative jobs fall into. Once the HR group becomes overwhelmed with useless trivia, they do not have the time or talent to conduct more vital and valuable work. Being an HR strategic partner requires elevating above mere administration. . We make HR the policy-cops. There is no doubt that HR should be involved in the drafting of policy, but their role in enforcement should be that of an advisor, not an enforcer. It is the job of individual managers to enforce policy. An HR strategic partner coaches, supports and advises managers through the enforcement of policy issues. 4. There is no HR business plan. HR needs to have clear deliverables and measures just like any other business. The HR business plan needs roll out of the greater organizations strategic, tactical and action plans.
An HR strategic partner enables the achievement of the overall business plan through superior people practice. 5. Managers like to use HR as a scapegoat. It’s much easier for managers to tell their people unpleasant news if they can pin it on someone else. Usually the target of such finger-pointing is either higher-level management, or the HR group. In either case it is inappropriate. Managers need to take responsibility for the leadership and management of their human assets. An HR strategic partner is a trusted advisor to getting this done well. 6.
HR is not properly staffed. If your HR group is filled with able administrators, but not people with any real business training or experience, you will not have an HR strategic partner (although your staff picnics will probably be great). 7. HR reports through finance. The practice of having HR report through Finance is far too common. If you want an HR strategic partner, HR needs to report to the people responsible for executing the strategy. If HR isn’t at the senior leadership table, then it is highly hypocritical to claim that “employees are our most important asset. 8. HR people do not know the core business. In order to provide quality, professional advice to managers in the core business, an HR strategic partner needs to understand that core business. It is not necessary to be expert, but there are many organizations where the HR people do not fully understand how the company operates, or how it manages and measures its success. 9. HR should be a place for high performers, not the company ghetto. If an organization expects outstanding performance from its HR group, it needs to staff it with outstanding people.
If HR becomes the ghetto of the organization where we put people who couldn’t make it in the core business, or a place where we hire less than the best to try to meet diversity requirements, you won’t have an HR strategic partner. 10. HR needs to be better at selling itself, and influencing others in the organization. An HR strategic partner is an influencer more so that s/he is a decision-maker. As such HR needs to become much better at “selling” its viewpoint. Moreover, for organizations that don’t’ know how they should best use HR, it is up to the HR people to define and sell its role in the company.? What’s to be done?
If you find that your organization has an HR department that sucks for any or all of the reasons above then action needs to be taken right away. As a starter: 1. Have an HR business plan that is attached to the organization’s strategic plan. Without a clear focus, there is no chance of having an HR strategic partner. 2. Get skilled business people into HR. If you staff your HR department like an organizational ghetto, your results will match. An HR strategic partner is a highly skilled, high-potential human asset. 3. Get HR to the table. An HR strategic partner needs to be included in all important discussions.
If HR’s not at the table when those discussions take place, there is no change of maximizing the value of the human asset, and no change of truly being a high performing organization. The Human resource Manager plays a critical role in ensuring that the human resource function achieves its objectives. Further, employees’ energy, competence and skills are utilized towards accomplishment of the corporate objectives. This is done by aligning the HR function and people strategies to the organization’s business plan. HR is becoming more accepted as a strategic business partner. Human Resource Manager Job Description
Make the Human Resource function more relevant by helping employees achieve the strategic intent of their jobs in alignment to your organization’s overall plan. Your job description as the HR Manager is related to the performance of the various aspects of the HR function as stated below. * Human Resource planning * Employee recruitment and selection * Employment laws compliance * Compensation and incentives * Staff Counseling and Coaching * Occupational safety and health at work * Industrial Relations or Employee relations * Retirement * Termination * Organisational development * Employee training and development Performance management Detailed List of the Duties and Responsibilities of the HR Manager In order to ensure that you, as the HR Manager or HR Head, can become part of the organization’s corporate planning team, you need to demonstrate that you can perform the following: * Playing a significant role in the development and implementation of corporate strategy. This forms part of your capability in translating business strategies into HR strategies. * Analysing the internal and external environments in order to identify factors that can have negative impacts and to find ways to prevent their occurrence or limit their effects. Ensuring that there is cooperation between the HR function and line management. This helps in the anticipation of HR needs in the immediate, medium-term and long-term. * Identifying and implementing the right technology such as HRIS to drive the business strategy of the organization. * Ensuring that anti-discrimination legislation and other employment legislation are followed. * Understanding and implementing accepted principles of learning in the process of planning, conducting and evaluating training and development programs.
Doing this will help your people to learn effectively and a favourable ROI of training budget supports these programs. * Helping managers motivate their subordinates to perform their jobs to the standards expected. * Ensuring that there is a systematic approach to compensation management to support the business strategy. * Promoting and creating awareness among management and employees on the importance of a safe and healthy work environment. * Helping your management team and supervisors to effectively manage diversity in the workplace. Handling all negotiations with unions or acting in an advisory role to operating managers in industrial matters * Helping the organization in finding or formulating effective HR strategies when it decides to expand its business operations worldwide. The HRM Function and HRD In some organizations, the function of human resource management is separated from that of human resource development. But your organization can choose to combine the two functions. There are also organizations who create positions reporting to the HR Manager such as Recruiting Manager, Training Manager and Compensation Manager.
By doing this, the HR Manager can concentrate more on planning and strategy formulation. But additional people means higher HR overheads. The Human Resource Manager job description must reflect its strategic relationship to the Business Plan The Changing Role of the Human Resource Manager’s Position As stated above, the position exists primarily to help achieve the strategic business objectives of the organization. The accepted changed roles of the HR Manager include: 1. As HR Strategic Business Partner This requires full understanding of the organization’s business.
This assists you in the plan to align HR strategies, policies and practices with the business strategies. For example, if your organization intends to use a particular technology or adopt a certain business strategy to increase customer satisfaction and higher productivity, HR must provide the necessary support. An example of the application of this role is in the recruitment and selection process. There is a link between the organization’s objectives, those of HR objectives and employment objectives. How can the HR Manager become a strategic business partner?
Ulrich states that HR Managers and other employees can become strategic partner “when they have the ability to translate business strategy into action. ” This requires HR Managers and HR professionals to develop business acumen, to become customer-oriented, and to link business strategy into HR policies and practices. Only then they can add value and HR leaders allowed toparticipate in decision making at the organization’s strategic level. 2. As Change Agent As the Human Resource Manager, you need to identify strategies to improve commitment of employees to both customers and the organization.
You also need to educate yourself on business principles in order to become more effective in initiating and managing change. Being equipped with this know-how, you can make or recommend changes in the HR function in response to new challenges. Doing this will make the HR function become more critical and strategic. We need to take note that line managers are also in the business of playing the role of change agent. When Human Resource Managers and HR professionals fail to play this particular, there is a risk that senior management will sideline them. 3.
As an Administrative Expert This means more than merely performing the administrative tasks or taking care of the rules book. The Human Resource Manager and HR professionals need to identify the right technology, to redesign work processes, andcontinuously improve or recommend improvements in the organization’s processes. HR efficiency is measured in terms of costs-benefits and HR effectiveness in terms of its quality. In doing this, the HR function can create value through HR people becoming “internal consultants. ” 4. The Human Resource Manager as Employee Champion
The position also exist in order to satisfy employee needs, to ensure fair and principled management decisions, and to help employees to effectively perform their jobs. We need to remember that the HR Manager’s position is not there to defend employees against the organization. Where necessary, he or she must take the difficult decision of terminating employees who are non-performers. Some writers refer to this role as ’employee advocate. ‘ 5. Other Roles of the Human Resource Manager In some organization, the HR Manager also: * Performs corporate affairs duties * Manages communication channels Carries out community relations tasks * Handles safety and health issues or some of these. Apart from Human Resource Managers, other key people who are HR champions are HR Heads or Chief Human Resource Officers, and HR professionals. Others who need to concern themselves about HR are line managers and supervisors. What does being an HR champion really mean? Search for books from Amazon. com on what HR champions are involved in. Making the Human Resource Department More Relevant As the Human Resource Manager, you need to make the human resource department relevant to the business affairs of the organization.
It cannot afford to take the role of anuninterested by-stander. Continue to make its role as a strategic business partner accepted by the organization’s leaders. Ensure that the Human Resource Manager’s position contributes towards the realization of your organization’s drive for success. And that it will continue to play that role. “The real wealth of a nation is its people. And the purpose of development is to create an enabling environment for people to enjoy long, healthy and creative lives. This simple but powerful truth is too often forgotten in the pursuit of material and financial wealth. INTRODUCTION Globalization of Indian economy is compelling organization to rethink their future strategies. It is now widely recognized that transformation is a pre-requisite to their survival and growth. Business organization in India especially public enterprises are experiencing winds of change. For the HR function, there would not be a more existing and challenging opportunity than managing the complexities of change and transformation. HR today is playing a lead role along with business functions in creating the necessary momentum and internal capabilities.
Now first let us understand what we mean by globalization. WHAT IS GLOBALIZATION? Every day we hear it on news, we read it in the newspapers, we overhear people talking about it… and in every single moment the word ‘globalization’ seems to have a different meaning. So what is globalization? “…integration of business activities across geographical and organizational boundaries. ” “The capacity to treat the world as one market while…dealing with many culturally diverse merchants. ” “…the process by which markets expands to include competitors for customers and productive inputs without regard to national boundaries”. …doing business with a world wide focus… rather than doing business in an international market with the focus from a home-country viewpoint. ” Globalization is not just a recent phenomenon. Some analysts have argued that the world economy was just a globalized 100 years ago as it is today. Yet the term is used since the 1980’s, reflecting technological advances that have made it easier and quicker to complete international transactions, both trade and financial flows. The most striking aspect of this has been the integration of financial markets made possible by modern electronic communication.
At a political and economic level, globalization is the process of denationalization of markets, politics and legal systems i. e. the use of the so-called global economy. Globalization refers to an extension beyond national borders of the same market forces that have operated for centuries at all levels of human economic activity (village markets, urban industries, or financial centers). It means that world trade and financial markets are becoming more integrated. At a business level, we talk of globalization when organization decides to take part in the emerging global economy and establish themselves in foreign markets.
First they will adapt their products or services to the customer’s linguistic and cultural requirements. Then, they might take advantage of the internet revolution and establish a virtual presence on the international market place with a multilingual corporate website or even as an e-business. Overall, globalization requires a combination of linguistic, engineering and marketing knowledge that is not easily available. (Sparrow, Paul, R, 2006) Globalization is linked to four major aspects: Trade Capital movements Movement of people Spread of knowledge DRIVERS OF GLOBALIZATION
Driving factors of globalization can be divided into four groups: MARKET DRIVERS Convergence of per capita income Convergence of life styles Organizations behavior as global customers COST DRIVERS Push for economics of scale Advances in transportation Emergence of newly industrialized countries with productive capability and low labor costs COMPETITIVE DRIVERS Growth of global networks making countries interdependent Rise of new competitors intent on becoming global competitors Increased formation of global strategies alliances GOVERNMENT DRIVERS
Reduction on tariffs and other trade barriers Privatization of industry in many parts of the world Creation of trading blocks (i. e. EU) Globalization has elevated the importance of HRM development in organization. These changes have led to the notion of the HR system as a strategic asset. Many of the arguments about processes of globalization within the HR function rest on the assumption that there has and continues to be longitudinal change in the conduct of HR. n the intervening seven years a wide range of contextual changes have led to significant globalization of activity, including: the transfer of work abroad, either to outsourced providers or on a global in-sourcing basis; the e-enablement of many HR process; greater sophistication in the HR information technology, new structures for international HR functions; greater competition for talented staff at all levels of organization; more protracted and strategic talent pipelines. In particular, there has been a very strong marketing, corporate communication and IT influence on the HR function.
The HR function is realigning itself in response to this process of cross-function globalization (building new alliances with these functions) creating new activity streams and new roles and skills required of the HR function (Sparrow, Brewster and Harris, 2004). HUMAN RESOURCE MANAGERS: THEIR ROLE IN A CHANGING ENVIRONMENT Issues facing HR are expected to change dramatically in the next decades. Thus, HR professionals must play special roles in dealing with these changes and must develop specific competencies to support these roles.
Workplace flexibility is expected to be on the rise as the future workplace, the ‘virtual office’ is characterized by creative and flexible work arrangements. As more employees work off-site-up to two thirds of an organization in the 21st century – there will be an increase in emphasis on performance and results as opposed to the number of hours worked. In addition, off-site employees can expect to attend fewer meetings. Specified work will become much more collaborative and management will spend nearly all its time managing cross-functional work teams who enjoy a lot of autonomy.
In essence, there will be a movement, a trend towards a decentralized model of HR. HR managers will have to accommodate employees in their virtual work locations and find ways to manage corporate culture, socialization and employee orientation. In order to obtain and maintain a competent workforce, they must act as organizational performance experts and shape employees behavior without face to face meetings. Another expected change in HR is the ‘Global Business’ concept world trade knew a major growth during the last years and there is forecasted as well the growth of international businesses, especially among small firms.
Organization rely more and more organization HR specialists as the facilitators of work across borders and among different cultures. Therefore, they must be knowledgeable of other cultures, languages and business practices. They will be required to develop and manage an international workforce, maintain written and unwritten corporate polices for transportability to other cultures, keep top management informed of the costs of not paying attention to the transnational issues and provide their services to a variety of locations world wide.
Concerning the recruitment in the above mentioned ‘global business’ it will be important which strategy will be adopted by the management. Globalization will impact HR managers by requiring new skills such as language capabilities. For e. g. , in order to recruit employees from other cultures, HR managers will either have to learn new languages or else they will certainly have to have foreign speakers on staff. But in order to facilitate communication among people coming from a wide range of language backgrounds, in most multinationals, it is preferred to speak English. However, when we talk about Globalization and culture, hen how does this relation influence businesses and HR professionals’ attitudes? Organization must take into account cultural differences that shape managerial attitudes, when developing multinational management programs. For e. g. , British managers value individual achievement and autonomy, whereas French managers appreciate competent supervision, fringe benefits, security and comfortable conditions, while Indian managers gives more importance of their culture and tradition. HR managers must therefore be familiar with and understand other cultural norms to promote organization diversity.
An organization that recognizes and promotes cultural diversity will benefit because it will be employing the market that it serves. With increasing globalization and competition within the market, a diverse workforce is conducive to attracting and retaining a strong client base. While competing in an international market, employees from diverse national backgrounds provide language skills and understanding of other cultures. HR professionals will also be responsible for providing cultural sensitivity training for the organizations employees and for managers throughout the entire organization. Czebter, Anamaria, 2002) DILEMMAS FACED BY AN HR HEAD Unlike the other industries where HR is considered as a functional need, there is a need to view HR as a partner or a business enabler. One of the constant challenges faced in this area is to align HR to business. The five R’s therefore, assume utmost significance in HR strategy. The HR team needs to get in right from the stage of defining the business strategy to Resourcing, Recruiting the right talent, Retaining the talent, Retraining and Restructuring.
However, if we see the scenario of HR in IT company, we find that flexibility appears to be the key for success and survival as IT has become such a dynamic field due to the constant developments and upgradation in the area of technology and changing customer requirements. Topping all these reasons is also the trend of globalization, which tries the HR test of endurance. The ability and the willingness to modify job structure, job classification and the organizational structure as often and as quickly as necessary are important elements in a successful recruitment and retention strategy for IT professionals.
This challenges of managing expectations and change puts constant pressure on the professionals. The challenge does not stop with recruiting the right person but with how we are going to manage the performance of our employees. The challenge would be to create a performance culture where in opportunities are provided for enhanced performance and where giving out optimum performance becomes a way of life. Training and development is another area. In the IT industry training takes on a new connotation. It is not just about identifying training needs and giving the required training.
It is foreseeing and anticipating the requirements and developing suitable training so that the employees are well-equipped to handle the challenges. Another major challenge is how we are able to incorporate all the sub-systems in HR and help them in achieving the ultimate goal – exceptional performance. People have to be groomed to get in tune with the performance culture. Creating an environment that stimulates the creation of knowledge and its sustenance throughout the organization is big challenge. No longer can the HR department carry on with its traditional functions.
However, Human Resource Information Systems (HRIS) is to be put in place – to build and sustain a performance – driven culture. The role will shift to that of facilitator. HR will have to involve the whole organization in this process and act as a counselor and facilitator and that is the most gigantic challenge the HR of any organization faces. In the face of such challenges faced by HR managers, a question arises as to what competencies an HR manager needs to equip them in order to survive in the turbulent phase of globalization. COMPETENCIES FOR A HR MANAGER
In order to effectively deal with all the changes, HR professionals must develop competencies that will allow them to carry out their roles, competences like: Flexibility Team work Communication Decisiveness Leadership Strategic planning Network building Client service orientation Organizational awareness Self confidence Sharing of expertise Global and cultural understanding Multiple language competencies In addition to increasing and sustaining technological skills relating to communication developments, HR professionals will may also be required to increase their numerical and data compilations skills.
As increasing demands merge to provide specific measurable results that prove effectiveness in their area, HR professionals will be required that produce quantifiable results that prove that their department is delivering specified outcomes based on the objectives and goals set forth by the organization. In addition to delivering specific measurable developments, managers will also need to know what contributed to the results declared.
This may mean that HR professionals will be required to be familiar with and administer employee survey and provide for accurate data compilation and regression analysis. As a result of the increase in technology, innovation and globalization over the last 20 years, HR professionals around the world are forced to be more efficient, more effective and more competitive. They need to respond to the demands of global competitiveness by becoming more familiar with language skills, cultural awareness and diversity promotion.
Additionally, HR professionals must be committed to continuous learning, being familiar with cutting edge communication. If HR managers won’t pay enough attention to their changing role, serous consequences could result, including the deterioration or even perhaps the elimination of the HR department. (Halcrow A, 1998) TO SUM UP However, the research has shown that the HR function in international organization has to meet a series of challenges.
Three key conclusions about the role of HR professionals working in the field of international recruitment selection and assessment can be drawn: The added value of the HR function in an international firm lies in its ability to manage the delicate, balance between globally coordinated systems and sensitivity to local needs, including cultural differences, in a way that align with both business needs and senior management philosophy. There now appear to be a distinction to be made between international HRM and global HRM.
In this transition, the old functional divides between international recruitment, international management development and international reward management have become increasingly weak. Over the last 20 years, the workplace has changed in more ways that one could have ever imagined, resulting from the increase in technology, innovation and globalization. The next decade will bring even greater change, impacting all facets of the workplace, including major changes for the HR department and HR managers.
In order to respond to the demands of globalization, HR managers will require new skills and competencies relating to language and culture, technology capabilities to facilitate overseas communication, methods to measure and quantify effectiveness and evaluate strategies and return on investment. Evidently, these new skills and competencies will result in an emerging new role for HR managers, requiring them to be strategic business partner, supportive of the overall corporate strategy. The future role of HR professional will change from a less administrative role to more of a strategic role.
HR managers will continually be required to prove their effectiveness and their existence. They will be expected to understand international business practices and promote cultural diversity within the organization. They will need to understand the core business of the organization and become partners with line managers. They will need to prove that their initiatives and programs are result-oriented, providing specific measurable results in terms of business competitiveness that contribute positively to the bottom-line of the organization.
They will be required to stay current with leading edge as more and more organization is faced with the demands of globalization and strategic alliances with other organization around the world. There is a lucid need for the role of the human resource manager to be clarified. When the roles of management and personnel are ambiguous, or when there is tremendous change, line managers and executives take over some of the people management functions, a practice that is seen as problematic by some HR Professionals.
This encroachment, however only becomes a problem when HR lacked the skills, or credibility to perform their duties competently. To ensure its own viability, the HR function must be prepared to adopt contemporary roles to meet the considerable challenges posed by emerging organizational realities. Dave Ulrich, a renowned consultant, teacher, and researcher in the field of strategic human resources, suggests four critical roles that HR Professionals and managers must acquire to be effective in this new business environment. These are the role of: ? Strategic Partner ? Administrative Expert Employee Champion ? Change Agent Thus, the changing competitive realities have provided the HR function with an unprecedented opportunity to create significant shareholder value through the effective management of the company’s HR management systems. This opportunity can however, only be utilized effectively, if HR Professionals are able to take up the challenge of becoming business partners with line management in pursuit of company goals. It was also found that for HR Professionals to effectively operate as strategic partners, two types of competencies are critical: ? Professional Competencies Business-related Competencies Professional HRM competencies related to the delivery of traditional technical HRM practices are deemed both necessary, but not sufficient for assuring the development and effective implementation of HRM practices. However, it was argued that although professional HRM competencies were necessary in assuring technical HRM effectiveness, they were not sufficient. Business-related competencies were also important because they enabled HR Professionals to understand how business considerations unique to an organization can create organization-specific HRM needs.
In the results of the study, the researchers reported that HR Professionals were very proficient in the delivery of traditional HRM activities, but much less so in what they termed “business-related” competencies. Yet it was just this type of competency that had the strongest relationship with corporate financial performance and this is the same area that represents the greatest economic opportunity. It is certainly not suggested that professional competencies are not still very important for HR Professionals to be successful contributors to the organization. Competencies, however, have lifecycles.
In research done in New Zealand by Karl Pajo and his colleagues, they found that while HR qualifications and experience were deemed important to develop “trade skills” these were not sufficient in themselves to contribute at a strategic level. Broad qualifications and line management experience were widely valued to develop a “commercial orientation” deemed necessary to contribute at a strategic level. Thus, a dual background was necessary The organization must see the HR role as linked to its business strategy and that HR helps foster the culture necessary to implement that strategy effectively.
Effective human resources planning has become even more important in the highly competitive, global business environment of the 21st century. Organizations are evolving into more complex but nontraditional structures in order to be competitive and attract and retain the key individuals upon which success depends. Yet there does not seem to be a rush or increased interest in human resources planning. Often misunderstood and relegated to a task-driven, bureaucratic role, human resources is not always able to be the strategic business partner it needs to be. What is human resources planning?
Human resources planning is a process intended to help guide the organization plan in any of the following general areas: * Staffing * Growth and development * Leveling off and disengagement * Replacement and re-staffing * Job rotation and cross-functional training * The design, implementation, and management of supporting programs such as benefits and compensation To ensure you are developing the most effective human resources plan, your organization should review the need for having the following plans: * Strategic business plan * job or role competency planning Manpower planning * Training and development planning * Career development planning and process * Planning for and managing terminations, downsizing, and attrition Human resources planning is not something the HR department should do on its own. So where does the responsibility for effective human resources really lie? In high performing organizations, good human resources practices are most effectively performed by line management with the human resources department providing the tools, guidance, and counseling needed for the line managers to be successful.
While there may be any number of ways to conduct human resources planning, we find that the two most frequently used methods are standard planning and strategy-based planning. Standard planning Probably the most common planning approach uses the staff size and configuration at the end of the year to project staffing levels and costs into subsequent years. Scenarios are then developed for incremental staffing and cost for new programs and projects. There are, however, drawbacks to this approach: * It implies that all existing business activities will be continued and are as important as new strategies and plans. It assumes that the current business activities are the foundation for reaching the company’s business goals and are being performed effectively. * It can unnecessarily increase staff levels and not consider the specific competencies that are needed to achieve the strategic objectives. * It will not uncover, within the organization, those who continue to want to increase the level of employees to preserve power and compensation without looking at productivity. * It tends to institutionalize the existing planning process and systems beyond their usefulness. It shortcuts important communications from line and staff managers on their goals and support requirements * It supports an outdated concept tying compensation and recognition programs to rewarding those with the largest staffs. * It supports the nonproductive concept that one must have sufficient staff to respond immediately to any request regardless of its importance. Strategy-based planning To support the strategic business objectives of an organization, a strategy-based human resources planning process is a more effective approach.
This approach is part analytical process and part creating the staffing and services based on the strategic goals, eliminating anything that does not support those goals. Here are some things to think about: * Start by understanding the specific business priorities by department and business unit based on the overall strategic objectives. * Understand the internal and external factors that may affect the achievement of the objectives that will ultimately impact the programs and services you will provide. Understand who has the responsibility and accountability for achieving each of the objectives, where they are shared, and who is to absorb the associated costs. (This will identify who your internal customers will be and what they expect. ) * Determine if alternatives for the achievement of each business objective have been developed and what impact that will have on services. * Translate these business objectives into specific human resources programs and services. * Determine the trade-offs in terms of resources needed and tinting. Analyze the impact if each business objective is not achieved in terms of HR services. * Test each priority starting with the lowest one in terms of the return versus the expenditure of time and money. * Determine where efficiencies can be achieved. * Determine the staffing requirements to meet the business objectives, including level of staffing required and timing; type of employees and specific competencies required; current complement versus your zero-based staffing requirements; where surpluses and gaps exist.
Every organization provides some standard human resources programs and services; some organizations offer different programs based on culture, size, and competitive needs. It is a good idea to start with a checklist of your human resources programs and initiatives. Then do some research and prepare a list of the types of human resources programs and services that are found throughout the business community. These lists will be a helpful guide during your human resources planning process. HR as strategic partner In a recent survey by the Conference Board, 252 CEOs were asked to name the critical threats to their businesses and industries.
The results vary by company size but “shortage of key skills,” “changing technology,” “regulatory compliance issues,” “environment, health and safety,” and “changes in competition” were among five of the lop 15 concerns, with “shortage of key skills” ranked as the top concern. All of the aforementioned CEO concerns will be affected by the strategic human resources initiatives of the company. Because the business community is moving to a knowledge-based culture, understanding the key competencies needed for your organization to be successful is critical. This should be the primary focus of human resources.
An HR department must assume the role of strategic partner with the CEO and other top executives in a proactive way to ensure there is effective alignment of the overall business goals with the human resources initiatives. Human resources, in the past, has been viewed as a tactical or transactional function and often was not invited to sit at the business table. For an organization to be successful, that perception and role must change. Human resources, as a strategic partner, will need to be involved in the business planning process, thoroughly understand the plan and be able to translate these plans into actions.
This will ensure the organization has the right people with the right strengths in the right roles at the right time. It should challenge the business assumptions and plans and bring to the business table innovative ideas for how the organization can compete in the future. Thinking outside the box, an HR department must take a leadership role, linking the business objectives to the required culture and staffing of the organization. In addition, an HR department must be asking and pressing for answers to the following questions: * What does success look like in our organization and how can we identify and measure it?
What is considered a high performing team in our company? * Have we developed a business plan in which everyone understands their respective roles in achieving the results and buys into it? * What do we need to deliver for the company to achieve its strategic objectives? Consider the areas of culture, recruitment, compensation, benefits, training and organizational development, and outside competition. Consider the audiences of senior management, middle management, employees, and regulatory agencies. * What specific actions do we need to take in each area? What resources will be required? Are they available? * What specific competencies are required to deliver these results? Are they currently available? How can they be developed? Are we effectively competing for knowledge-based talent? What are the competency strengths of our competitors and how can we better compete against those strengths? * How will we address the identified competency gaps in the organization? * To what level should we have a developed succession plan? * How well do the team members understand the strategy and what it means to them?
What can we do to enhance their understanding? * What performance objectives do we need to establish to drive results on a group level as well as an individual level? * How will we measure those results and how often? * What external benchmarking will we use to measure your results against other firms? * How will we reward employees for achieving those results? * How will we communicate your progress and success? In high performing organizations, the human resources department works in partnership with both line and staff managers.
In these organizations, human resources professionals evolve into a strategic role and business partner, leaving the tactical responsibilities to others, whether they are within the HR department or outsourced. They challenge the status quo; they are facilitators of change and are visionaries who find alternative choices to give business partners. Barriers and misconceptions Planning? Many people ask, “Do I have to? ” Yet it has been demonstrated that human resources planning is an essential element of running an organization effectively and efficiently.
So why are human resources planning and budgeting given so little attention compared to other elements of business planning? Considerable time is spent developing comprehensive sales, marketing, technical, financial, and other plans with often only superficial attention to the human resources implications of the business plan. There is no question that human resources planning should be closely aligned with the strategic objectives of the organization. Most human resources and business professionals understand this concept, but it is alarming how few are able to implement it.
Why is this? Some possible reasons include: * Human resources is considered a task-driven, primarily tactical function and does not have an equal seat at the business planning table. * Human resources does not have the expertise, is unable to drive the process, and is not viewed as a strategic partner with management. * Human resources is more focused on trying the latest management or human resources fad as a way to look good and add perceived values rather than meeting the businesses’ strategic needs. * It is assumed that human esources will take care of planning (like finance will take care of the numbers), so discussions about HR planning are limited. * Executives feel they have always been able to get by without detailed human resources planning and it is essentially a waste of time. * Management believes that human resources planning limits its flexibility and ability to make decisions on a case-by-case basis during the planning year and unnecessarily ties their hands. * The organization has always been flexible and adaptable to new situations and it is too difficult to predict what might happen and then plan for it. Management has never required and properly trained line managers to participate in sound human resources planning activities. In addition to the previously mentioned potential barriers, there is a common misconception that human resources planning is the same as manpower or staffing planning. Not so! The human resources planning process must consider not only specific staff needs, but also areas such as: * Services to be provided in support of the specific strategic objectives and the cost and timing for these services. Prioritization of the strategic objectives and identification of the specific services to support those objectives with cost/benefit analysis. * Internally versus externally purchased services and costs/benefit analysts. * The services that will be centrally provided, as well as those that will be decentralized or shared with other functions. * Competency gaps between existing staffing and those required by the strategic plan and how those gaps will he filled. Training and development needs that support the strategic plan and address the competency gaps * Communications needs in support of specific business activities * Upgrades of programs, services, and equipment that will be required. * New human resources technology introductions to the organization needed to support the business objectives. * Where efficiencies in programs, services, and productivity could be achieved in areas that may be nice to have but do not support the strategic objectives. * Acquisition integration issues and impact on existing resources and achievement of the strategic objectives. Downsizing or re-engineering issues and impact on resources. * Succession planning and where need can be filled internally and those that will have to be filled externally * Compensation and benefits budget projections. * Types of metrics to be used to evaluate performance and the costs to provide them. * The unexpected. To avoid the pitfalls often encountered when doing human resources planning, it is best to base your planning on the strategic objectives as opposed to the traditional projection of year-end results into the future.
Yes, it takes more work, but it is an essential role that human resources must play to help the organization ensure it will achieve its objectives. Linking planning to performance Several years ago, Edgar H. Schein, a social psychologist, Sloan Fellows Professor Emeritus, and senior lecturer at the Massachusetts Institute of Technology Sloan School of Management, conducted detailed research on this topic and published his findings. Schein pointed out that certain changing dynamics in the workplace increase the importance of effective human resources planning.
Our own research and experience bear out his conclusions: Changing managerial role. Because organizations are becoming more complex in structure and technologies and are operating in more complex economic, political, and diverse cultural environments, managers cannot safely make decisions alone. They cannot get enough information within their own head to be the integrator and decision maker. Instead, they become the managers of the decision-making process. Changing social values.
Managing people has become increasingly complicated: There is a lot of emphasis on climbing the corporate ladder; people entering the workforce do not place the same value on their careers as those who went before them; and the ubiquity of dual-career families has changed work dynamics. In addition, we now recognize that growth is a lifelong process: Many issues are predictable when they appearance during employees’ life stages. Schein further points out that a major problem with human resources planning and development systems is they are fragmented, incomplete, and often built on poor assumptions about both human and organizational growth.
Instead, we should build upon what we know: Human growth occurs through continued exposure to one’s environment. To grow, individuals need both new challenge