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New Trends in HRM


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The challenge for HR managers is to keep up to date with the latest HR innovations -technological, legal, and otherwise.
How HR managers can anticipate and address some of the most challenging HR issues.

Published in: Education, Business, Technology

New Trends in HRM

  1. 1. New Trends in HRM Saroj Kumar Behera ITER B-school 10/20/11
  2. 2. Introduction <ul><li>Historically, the HR Department was viewed as administrative overhead. </li></ul><ul><li>HR processed payroll, handled benefits administration, kept personnel files and other records, managed the hiring process, and provided other administrative support to the organization </li></ul><ul><li>The role of Human Resources is changing as fast as technology and the global marketplace </li></ul>10/20/11
  3. 3. Introduction <ul><li>The positive result of these changes is that HR professionals have the opportunity to play a more strategic role in the business. </li></ul><ul><li>The challenge for HR managers is to keep up to date with the latest HR innovations -technological, legal, and otherwise. </li></ul><ul><li>How HR managers can anticipate and address some of the most challenging HR issues. </li></ul>10/20/11
  4. 4. 10/20/11 External and internal factors influencing the Personnel function <ul><li>External factors Internal factors </li></ul><ul><li> Technological factors  Mission </li></ul><ul><li> Economic challenges  Policies </li></ul><ul><li> Political factors  Organisational culture </li></ul><ul><li>Social factors  Organisation </li></ul><ul><li>structure </li></ul><ul><li> Local and Governmental issues  HR systems </li></ul><ul><li> Unions </li></ul><ul><li> Employers’ demands </li></ul><ul><li> Workforce diversity </li></ul>
  5. 5. HRM Activities 10/20/11 Human Resource Management Attract and orient new employees Effective compensation systems Effective work environment Compliance & procedures Effective relationships
  6. 6. Technological Changes And HRM 10/20/11 Technology includes tools, machinery, equipment, work procedures and employee knowledge and skills. The impact of technology on HR can be profound, as the following things clearly reveal: <ul><li>New skills, knowledge, experience and expertise required to gain the edge over rivals. </li></ul><ul><li>Downsize operations, cut organisational layers and cut the extra fat to survive in a competitive world </li></ul><ul><li>Collaborate and achieve teamwork </li></ul><ul><li>Relocate work from the office to the home </li></ul><ul><li>Internet and intranet revolution </li></ul>
  7. 7. How to deal with a human resource surplus situation? 10/20/11 <ul><ul><li>Why? </li></ul></ul><ul><ul><li>Automation </li></ul></ul><ul><ul><li>Restructuring </li></ul></ul><ul><ul><li>Mergers </li></ul></ul><ul><ul><li>Acquisitions </li></ul></ul><ul><ul><li>Competitive Pressures </li></ul></ul><ul><ul><li>Consequences? </li></ul></ul><ul><ul><li>Cuts payroll expenses </li></ul></ul><ul><ul><li>Eliminates extra layers </li></ul></ul><ul><ul><li>Improves functioning if firm’s product and service profile is good </li></ul></ul><ul><ul><li>Shocks those left out </li></ul></ul><ul><ul><li>Shattering impact on employee motivation and morale if not managed properly </li></ul></ul><ul><ul><li>Managing Survivors of downsizing </li></ul></ul><ul><ul><li> Bitterness, anger, disbelief and shock need to be handled properly </li></ul></ul><ul><ul><li> Give information as to why the action had to be taken </li></ul></ul><ul><ul><li> Tell how it is going to help the firm and employees in the long run. </li></ul></ul>
  8. 8. 10/20/11 Economic, Political And Social Challenges And HR <ul><li>Now-a-days, people, goods, capital and information are moving around the globe as never before. </li></ul><ul><li>Global competition is making every firm to think in terms of gaining an edge over rivals by producing high quality goods at a very competitive price. </li></ul><ul><li>This is where the ‘people’ dimension comes into being. Incentives, favourable work climate, team spirit, freedom to think and act independently, and a host of other HR initiatives are needed to keep talent from flying away. </li></ul>
  9. 9. What HR managers can do ? 10/20/11 <ul><li>Use workforce skills and abilities in order to exploit environmental opportunities and neutralise threats. </li></ul><ul><li>Employ innovative reward plans that recognise employee contributions and grant enhancements. </li></ul><ul><li>Indulge in continuous quality improvement through TQM and HR contributions (training, development, counselling, coaching etc.). </li></ul><ul><li>Utilise people with distinctive capabilities to create unsurpassed competence in an area (Xerox in photocopier, 3M in adhesives, Telco in trucks, Britannia in biscuits, Nestle in coffee, McDonald’s in fast foods, etc.). </li></ul><ul><li>Decentralise operations and rely on self managed teams to deliver goods in difficult times (Motorola is famous for short product development cycles. It has quickly commercialised ideas from its research labs). </li></ul><ul><li>Lay off workers in a smooth way, explaining facts (IBM, Kodak, Xerox, AT&T, Steel and Textile firms in India etc.) to unions, workers and other affected groups. HR generally plays a key role, these days, in planning and implementing corporate downsizings, and then in maintaining the morale of the remaining employees. </li></ul>
  10. 10. 10/20/11 Political factors <ul><li>Political stability </li></ul><ul><li>Formation of new political parties </li></ul><ul><li>Influence of politicians over Productivity linked wage agreements </li></ul><ul><li>Political parties sympathetic to trade unionism </li></ul><ul><li>Opposition to VRS schemes, downsizing operations, restructuring exercises. </li></ul><ul><li>Freedom to show the door to unwanted people </li></ul>Social factors <ul><li>Conducting business in a socially relevant and responsible way. </li></ul><ul><li>Hire qualified people or hire inexperienced local people and train them to avoid trouble? </li></ul><ul><li>Helping economically poor people, unemployed, underprivileged ones, etc. </li></ul>
  11. 11. Local and government-related factors 10/20/11 <ul><li>Meet legislative requirements </li></ul><ul><li>Offering jobs to certain sections of local community </li></ul>Trade unions <ul><li>Demands for higher wages, better working conditions, incentives, benefits, services </li></ul>
  12. 12. MANAGING WORKFORCE DIVERSITY 10/20/11 The workforce is becoming increasingly diverse now and organisations are doing their best to address employee concerns and to maximise benefits of different kind to employees with diverse educational, cultural and religious backgrounds. The diversity issues, mainly, include the following : <ul><li>Composition In terms of age, caste, education, culture, region, religion </li></ul><ul><li>Minority groups, Economically backward groups </li></ul><ul><li>Displaced persons </li></ul><ul><li>Child labour </li></ul><ul><li>Contract labour </li></ul><ul><li>Women employees </li></ul>
  13. 13. 10/20/11 INTERNAL ENVIRONMENT AND HR Organisations are also influenced by a variety of internal factors relating to strategy, culture, structure etc. <ul><li>Mission and Strategy </li></ul><ul><li>Internal Policies </li></ul><ul><li>Organisational Culture </li></ul><ul><li>Organisation structure </li></ul><ul><li>Human resource systems </li></ul>
  14. 14. 10/20/11 Designing appropriate HR systems <ul><li>Issue Focus on </li></ul><ul><li>Nature of employment : Job/Career </li></ul><ul><li>Recruitment : Internal/external/both </li></ul><ul><li>Selection : Merit/other considerations </li></ul><ul><li>Training and employee : 6 months/yearly development actions Regular/irregular/need based </li></ul><ul><li>Degree of participation : Top down/bottom up </li></ul><ul><li>Incentives : Individual merit/group output </li></ul><ul><li>Job security : Lifelong employment/need-based jobs </li></ul><ul><li>Employee welfare : Be a model employer (offer those that are needed by law.) </li></ul>
  15. 15. An Aging Workforce <ul><li>The ministry of labour tracks changes in the composition of the Indian labor force and forecasts employment needs. </li></ul><ul><li>Projections for 1996-2006 , indicate the Indian labor force will have a phenomenal growth. </li></ul><ul><li>Some of the expected change involves the distribution of workers by age. </li></ul><ul><ul><li>Youth labor force, workers between the ages of 16-24, is expected to grow faster than the overall labor force. </li></ul></ul><ul><ul><li>The fastest growing segment will be workers aged 45-64. </li></ul></ul><ul><ul><li>By 2015, workers aged 40 and above will exceed the number under 40 for the first time ever. </li></ul></ul><ul><li>Organizations will struggle with ways to control costs and will have to find new ways to attract, retain, and prepare the youth labor force. </li></ul><ul><li>Values tend to change from one generation to another as well as during different life stages. </li></ul>10/20/11
  16. 16. Skill Deficiencies of the Workforce <ul><li>The increasing use of computers to do routine tasks has shifted the kinds of skills needed for employees in the indian economy. </li></ul><ul><li>Employees must be able to handle a variety of responsibilities, interact with customers, and think creatively. </li></ul><ul><li>Most organizations are looking for educational achievements and a college degree is a basic requirement for many jobs today. </li></ul><ul><li>The gap between skills needed and skills available has: </li></ul><ul><ul><li>Decreased ability to compete because they sometimes lack the skills to upgrade technology, reorganize work, and empower employees. </li></ul></ul>10/20/11
  17. 17. High-Performance Work Systems <ul><li>High-performance work systems are organizations that have the best possible fit between their social system and technical system. </li></ul><ul><li>Some of the trends in today’s high-performance work systems are: </li></ul><ul><ul><li>Reliance on knowledge workers </li></ul></ul><ul><ul><li>Empowerment of employees to make decisions </li></ul></ul><ul><ul><li>Utilization of teamwork </li></ul></ul>10/20/11
  18. 18. Knowledge Workers <ul><li>Knowledge workers are employees whose main contribution to the organization is specialized knowledge. </li></ul><ul><li>The reliance on knowledge workers affects organizations’ decisions about the kinds of people they are recruiting and selecting. </li></ul>10/20/11
  19. 19. Employee Empowerment <ul><li>Employee empowerment means giving employees responsibility and authority to make decisions regarding all aspects of product development or customer service. </li></ul><ul><li>HRM practices such as performance management, training, work design, and compensation are important for ensuring the success of employee empowerment. </li></ul><ul><li>For empowerment to succeed, managers must be trained to link employees to resources within and outside the organization. </li></ul><ul><li>The use of employee empowerment shifts the recruiting focus away from technical skills and toward general cognitive and interpersonal skills. </li></ul>10/20/11
  20. 20. Teamwork <ul><li>Teamwork is the assignment of work to groups of employees with various skills who interact to assemble a product or provide a service. </li></ul><ul><li>Work teams often assume many activities traditionally reserved for managers. </li></ul><ul><li>Virtual teams rely on communication technology to keep in touch and coordinate activities. </li></ul><ul><li>Teamwork motivates employees by making work more interesting and significant. </li></ul>10/20/11
  21. 21. Focus on Strategy <ul><li>At a growing number of organizations, HR professionals are strategic partners with other managers . </li></ul><ul><li>The specific ways in which HR professionals support the organization’s strategy vary according to their level of involvement and the nature of the strategy. </li></ul>10/20/11
  22. 22. Business Strategy: Issues Affecting HRM 10/20/11
  23. 23. Focus on Strategy <ul><li>High Quality Standards: </li></ul><ul><ul><li>To remain competitive in today’s economy, organizations need to provide high-quality products and services. </li></ul></ul><ul><ul><li>Total quality management (TQM) refers to a company-wide effort to continuously improve the ways people, machines, and systems accomplish work. </li></ul></ul><ul><ul><ul><li>TQM has several core values. </li></ul></ul></ul><ul><li>Mergers and Acquisitions: </li></ul><ul><ul><li>Mergers: Two companies becoming one. </li></ul></ul><ul><ul><li>Acquisitions: One company buying another. </li></ul></ul><ul><ul><li>HR professionals have to sort out the differences in the two companies’ practices with regards to compensation, performance appraisal, and other HR systems. </li></ul></ul>10/20/11
  24. 24. Focus on Strategy <ul><li>Downsizing: </li></ul><ul><ul><li>Downsizing presents a number of challenges and opportunities for HRM. </li></ul></ul><ul><li>All employees should be informed: </li></ul><ul><ul><li>Why the downsizing is necessary </li></ul></ul><ul><ul><li>What costs are to be cut </li></ul></ul><ul><ul><li>How long the downsizing will last </li></ul></ul><ul><ul><li>What strategies the organization intends to pursue </li></ul></ul><ul><li>HRM can provide downsized employees with outplacement services to help them find new jobs. </li></ul>10/20/11
  25. 25. Focus on Strategy <ul><li>Expanding into Global Markets: </li></ul><ul><li>In order to meet challenges, companies must </li></ul><ul><ul><li>Develop global markets </li></ul></ul><ul><ul><li>Keep up with competition from overseas </li></ul></ul><ul><ul><li>Hire from an international labor pool </li></ul></ul><ul><ul><li>Prepare employees for global assignments. </li></ul></ul><ul><li>Employees who take assignments in other countries are called expatriates. </li></ul>10/20/11
  26. 26. Focus on Strategy <ul><li>Reengineering: </li></ul><ul><li>Reengineering is a complete review of the organization’s critical work processes to make them more efficient and able to deliver higher quality. </li></ul><ul><li>Reengineering affects HRM in two ways: </li></ul><ul><ul><li>The way the HR department accomplishes goals may change </li></ul></ul><ul><ul><li>The HR department must help design and implement change </li></ul></ul><ul><li>Outsourcing: </li></ul><ul><li>Outsourcing refers to the practice of having another company provide services. </li></ul><ul><li>HR departments help with a transition to outsourcing and many HR functions are being outsourced such as: </li></ul><ul><ul><li>Payroll administration </li></ul></ul><ul><ul><li>Training </li></ul></ul><ul><ul><li>Recruitment </li></ul></ul><ul><ul><li>Selection </li></ul></ul>10/20/11
  27. 27. Traditional HR vs. Strategic HR 10/20/11 Point of distinction Focus Role of HR Initiatives Time horizon Control Job design Key investments Accountability Responsibility for HR Traditional HR Employee Relations Transactional change follower and respondent Slow, reactive, fragmented Short-term Bureaucratic-roles, policies, procedures Tight division of labour; independence, specialisation Capital, products Cost centre Staff specialists Strategic HR Partnerships with internal and external customers Transformational change leader and initiator Fast, proactive and integrated Short, medium and long (as required) Organic-flexible, whatever is necessary to succeed Broad, flexible, cross-training teams People, knowledge Investment centre Line managers
  28. 28. Technological Change in HRM <ul><li>Advances in computer-related technology have had a major impact on the use of information for managing HR. </li></ul><ul><li>A human resource information system (HRIS) is a computer system used to acquire, store, manipulate, analyze, retrieve, and distribute information related to human resources. </li></ul>10/20/11
  29. 29. A Changing Economy <ul><li>The way business is conducted has changed rapidly during the past few years and will continue to do so. </li></ul><ul><li>Many companies are connecting to the Internet to gain an advantage over or keep up with competitors. </li></ul><ul><li>Electronic business (e-business) is any process that a business conducts electronically, especially business involving use of the Internet. </li></ul><ul><li>E-business involves several forms of buying and selling goods and services: </li></ul><ul><ul><li>Business-to-consumer </li></ul></ul><ul><ul><li>Business-to-business </li></ul></ul><ul><ul><li>Consumer-to-consumer </li></ul></ul>10/20/11
  30. 30. Changes in the Employment Relationship <ul><li>A psychological contract is a description of what an employee expects to contribute and what the employer will provide the employee in exchange for the contributions. </li></ul><ul><li>From the organization’s perspective, the key to survival in a fast-changing environment is flexibility. </li></ul><ul><li>Flexibility in HRM includes: </li></ul><ul><ul><li>Flexible staffing levels </li></ul></ul><ul><ul><li>Flexible work schedules </li></ul></ul>10/20/11
  31. 31. Changes in the Employment Relationship <ul><li>Alternative work arrangements are methods of staffing other than the traditional hiring of full-time staff. </li></ul><ul><ul><li>Independent contractors </li></ul></ul><ul><ul><li>On-call workers </li></ul></ul><ul><ul><li>Temporary workers </li></ul></ul><ul><ul><li>Contract company workers </li></ul></ul><ul><li>From employees’ perspective, alternative work arrangements provide some flexibility for balancing work and non-work activities. </li></ul><ul><li>The globalization of the world economy and the development of e-commerce have made the notion of a 40-hour workweek obsolete. </li></ul><ul><li>Offering flexible work schedules provide organizations with many benefits. </li></ul>10/20/11
  32. 32. <ul><li>Next is coming............. </li></ul><ul><li>For feedback/suggestion contact at [email_address] </li></ul>10/20/11