The Concept Of Managing Workers In An Organizations Through HRM - Case Study Example

The Concept Of Managing Workers In An Organizations Through HRM SHRM (Strategic human resource management) is the concept of managing workers in an organisation through human resource management (HRM as well as HRD), with main emphasis of attaining strategic goals of the organisation. “SHRM is the linking of HRM with strategic goals and objectives in order to improve business performance and develop organizational cultures that foster innovation and flexibility.” (Truss & Gratton, 1994). If a company follows SHRM, the activities of the HRD particularly recruiting will mainly border on achieving the strategic goals of the organisation. Any organized human activity, which is done in-group, will be most times constituted into an organization. So, Organization is a structure with a ‘collage’ of humans doing their allocated work under the supervision of a leader, for the benefit of the organization as well as them. These workers will normally be apportioned into different departments for better arrangement or streamlining of work. Among the many departments, which constitute an organization, the Human Resource Department’s (HRD) role is omnipresent and crucial, as it with SHRM and HRM policies can only boost an organization through various strategies. After the recruitment and apportionment of employees is over; it is the duty of the organization particularly the human Resources Department to provide the employees a perfect working environment, in which they will work effectively. Perfect working environment in the sense, HRD as part of optimal SHRM should play their part in recruiting the apt employees, allocating the work load perfectly, motivating the workers while they were working, solving the problems that may arise and thereby achieve the intended goals. So, this paper will critically evaluate the evidence that high performance human resource practices lead to high performance and successful results in organisations, particularly in the current scenario. SHRM practices during Recruitment Recruitment of apt employees and retaining them forms a key part of the organization’s functioning or even its survival. “Together, effective recruitment and retention attracts individuals to the organization and also increases the chance of retaining the individuals once they are hired” (Jackson and Schuler, 2003). In the case of Southwest Airlines, its recruitment process is so foolproof, creative and efficient that only one out of four applicants would be interviewed and less than 3% would actually be hired. This high filtering of best candidates even for the recruitment as part of the high performance human resource practices, and also during the recruitment process gives SW Airlines the ‘cream’ of the talent leading to high performance. So, SW finds the candidates whether he/she have these high mental qualities, through many processes including personality tests, which asses the unique blend of characteristics that define an individual (Jackson and Schuler, 2003). Another SHRM initiative, which is also aiding Southwest Airlines to recruit best staffs and at the same time optimizing the performance of the existing staffs, is the management decision to involve the existing employees in the recruitment process. That is, SW involves the line managers and other employees in the recruitment process. “Employees again become involved in recruiting activities as they help their employers’ efforts to attract others to the company.” (Jackson and Schuler, 2003). Because of this involvement, the existing experienced staffs, who will a good idea about the needs of SW, will help in recruiting the apt employees. Also, the existing employees who get the opportunity to contribute in the selection of their team members are also becoming more committed to helping them succeed, thereby improving themselves. “The involvement of all levels of management and employees along with the HR department in the selection process helps SW to build a strong network of employees, who can then successfully forward the organizations' mission of providing the right attitude” (Ginsberg and Freedman, 2003). SHRM practices during training period After the recruitment and apportionment is done, most times the recruited employees should need to be given training as part of SHRM practices to assimilate them with the working environment and to work on the goals. In competitive environment, the employees have to be ‘upgraded’ first, and thereby develop into an effective human capital. So, before the ‘greenhorns’ are placed in highly responsible positions, they need to be given necessary training. Also, when the existing employees fall short in their performance, mainly due to any lack of skill and knowledge about the process, they can be trained. So, organizations as part of high performance human resource practices could use the services of experienced in-house employees or even could use the experts from outside to train the under-skilled existing workers and the newly recruited workers, thereby improving the performance to achieve organizational success. “Good management consists in showing average people how to do the work of superior people” (Rockefeller qtd. by Braude, 1961). But, the weakness in this human practice is that, if the training is not given by qualified persons, and if the workers are not receptive even to quality training, then this practice will not develop the effective employees. However certain organizations as part of its SHRM or high performance human HR practices have successfully implemented the training or mentoring or coaching program. In Intel, an optimum mentoring program has been implemented and it is showing expected and optimum results. The program lays emphasis on sharing information, skills and knowledge from the mentors to the employees and also throughout the organization. The program involves many processes with the mentor formulating effective processes to tap and improve the employees, and thereby lead to high performance. Employees who have agreed to be mentors complete an on-line questionnaire in which they list any of their two dozen top skills... Partnership contracts and deliverables are used to ensure the program gets the results, the mentors and mentees desire (Gazzara qtd by Stroh et. al, 2004). HR practices to optimize motivation HR manager will play a major role in all the process of the organization, and as part of high performance HR practices should also involve the employees in those processes. That is, the HR managers can involve the workers in all the important processes by using the inputs from the employees for the optimum functioning of the organizations. During the various processes that takes place inside an organization, one of the approaches the leader as well as the HR manager as part of high performance human resource practices could try is, putting for discussion his/ hers thoughts, targets and strategies among the workers, and involving them productively. “…give them a clear sense of purpose, an accurate explanation of their personal importance in the running of the organisation, and regular communication about the direction and performance of the business” (hrzone). This strategy will have favourable results. “Don't tell people how to do things, tell them what to do and let them surprise you with their results” (Patton). This strategy will surely lead to high performance among the employees because when they are involved in the important processes and are asked to contribute by the leaders, they will accentuate their thought process and physical capabilities. But, the problem with this practice is that, some leaders or managers will not give equal chances to all the employees. They will pick their favourites based on negative and non-organizational aspects. This partiality laced behaviour will affect the moral of the employees, who are sidelined. However, American coffee major Starbucks was able to optimize motivation and thereby high performance by productively involving the employees. The performance of Starbucks’ employees and thereby human capital was optimized by the designing and the adoption of “employee contributed mission statement”. That is, Starbucks management always introduces their mission statements among the employees and forms the final statement after the analysis of the feedback from the employees. “Starbucks guiding principles underscore the company’s commitment to all people and to diversity. Provide a great work environment and treat each other with respect and dignity.” (starbucks.com). HR practices during rewarding Optimum and unbiased rewarding system should be part of any performance management system because it can only motivate the employees by imbuing in their mind that their performance will surely be recognized and feted. It can only optimize the performance of the workers. “…build the psychological contract, in which employees feel valued by their employer, and the employer values (and is seen to value) employees’ contributions” (cipd). But, if this rewarding system is biased, illogical, un-genuine, it could affect the performance. If this practice is followed, it will create disenchantment among workers and will show the organization in poor light. So, to keep the core group of good workers in a motivated state, the organization needs to award the right individuals with correct inputs from the HRD and HRM. Only, if they decide that the rewards are fair they are more motivated to put effort into tasks (Beardwell and Claydon 2007). “Especially in organizations that use performance management as a basis for pay and other HR decisions, it is important to ensure that all employees are treated in a fair and equitable manner” (Pulakos, 2004). Allocating Rewards and Status to the deserving and apt candidates or workers is an important trait the leader should have. In an organization, the workers would do their duties for personal motivations like money, looking after their family etc, but their motivation level will get a great boost if they receive rewards and promotions. “Motivation is the art of getting people to do what you want them to do because they want to do it” (Eisenhower). Rewards and promotions to deserving and ‘success achieved’ workers will motivate them to give better results and motivate others also, to reach that status. So, leaders can quickly get across their own priorities, values, assumptions, etc and importantly organization’s goals and profits by consistently linking rewards and punishments to the activities of the candidate. HR practices to optimize physical environment An important method for optimum performance, which a HR manager and the HRD could implement as part of high performance HR practices, is providing a perfect and comfortable working environment for their workers. For that, the best option is going for an open-office layout. That is, cubicles should be preferred instead of offices with doors because, in an office set up where team work will have prominent place, face to face interaction would bring in more ideas, than one calling other into a closed room and having a closed discussion. Also minimization of the use of status symbols such as private offices, special dining rooms for executives, and personal parking spaces should also be curbed down. This is one of the important needs because it will give even the lower staff, the feeling that all are treated equal, irrespective of the salary, experience etc. “From that baseline, we consider a set of related hypotheses, testing whether factors such as the extent to which the affiliate is embedded in the local environment, the extent of flows between the parent and the affiliate, the characteristics of the parent, and the nature of the industry, influence HRM practices” (Rosenzweig and Nohria, 2004). Instead of special rooms, many conference rooms and attached kitchens could also be setup to encourage people and interact comfortably. So, these kind of environment, if made part of the high performance human practices, will make the individuals stay, at office, an enjoyable experience at the same time encouraging experience. “Recognise their responsibility in humanisation of organisational environment to make the employees feel that the organisation where they work and spend a large part of their working life is theirs and realise that it is their second family and that they are taken not of, valued and cared for” (Rao, 2004) SHRM or HR practices during the current recessionary times In this globalised world, an economic problem in one country will not get restricted to that country, but gets spread to other countries. The economies of most of the countries in the world are directly and indirectly dependent on the U.S.’s economy and with liberalization happening everywhere, the negative effects in USA will be felt everywhere, with businesses worldwide facing the negative impact on its HRM policies. Many companies are suffering losses and as a result of it several companies are opting for retrenchment strategy. Cost cutting would have to eventually result in job cutting. British Airways (BA) has said that it plans to cut a further 1,200 jobs after reporting a huge loss of £292 million in the six months up to the end of September. (Hinton 2009). Fewer job requirements and constant lay offs irrespective of the sector made employers to be choosy about the kind of employees they want and more dominant in deciding the compensation package for them. Many reputed organizations have quietly cut the salaries and other fringe benefits to their employees. BBC plans to cut the amount it spends on the salaries of its top bosses by about 25 percent, The BBC currently spends about $129.4 million on pay for its 634 senior managers and nine most senior executives. (Bryan-Low 2009). HR Managers have upper hand these days and really have become dominant, slightly skewing HR practices leading to organizational failure. Instead of thinking about how to optimize productivity and thereby effectively overcome financial problems, managers look at the easy way out. When negotiating with their employees there are some critical issues that concern both like salary, work timings, leave options, promotions, stiff targets and bench marking etc. In each of the above mentioned areas managers dictate terms to their employees throwing value systems to the wind. Compensation package with several companies were touching the roof before the recession. But, it took a nose dive, once recession started creeping in. In an organization, the workers would do their duties for personal motivations like salary. “Salary strategies and job enrichment strategies were positively related to job satisfaction.” (Arocas & Camps, 2008,). Before recession there was a fear among managers that poor salaries may result in minimization of employee commitment as well as employee turnover and also result in non-achievement or organizational goals. However, now the managers know that if an employee leaves the job he will go jobless as other companies also can’t employee them, as many companies are collapsing. High street names Woolworths and MFI were among more than 3,000 UK firms that collapsed into administration as they buckled under the pressure of soaring costs, falling consumer spending and the credit crunch'. (walesonline.co.uk). These negative HR practices in this tough times is cause for concern and need to be corrected to get high performance from the employees. HR practices to take care of the employees Every HRM based ‘liberties’ or practices that employees used to get before the recession has gone out of the roof. For example, the concept of flexible timings and work at your own convenient time has been discarded by the companies in the post recession period. Employees are given strict timings and also they have to work over time many a days with out being paid extra. “Overworked techies are putting in even more free hours than last year as the recession piles pressure on U.K. companies to do more with less. One in three techies is giving away the equivalent of 34 days of unpaid overtime per year--an increase of two days on the year before” (Thomas 2009). This results in a lot of stress leading to concerns about the utility of HR practices. Organization needs full utilization of their workers to reach their targets and to increase productivity. But, with stressed mind, the employees will be hard-pressed to use his/hers physical and mental part, to work effectively for the organization. “Today, stress-related disability claims are the most rapidly growing form of occupational illness” (Casico, 2005, p.587). HR manages and management team as part of high performance HR practice should actualize stress free environment by giving them paid holidays, involving them in physical games, etc. Also, based on the employees’ performance and importantly on the basis of HR practices, job promotions are given. Allocation of rewards, incentives, promotions and also recognition to the deserving and apt employees is an important strategy to keep the motivation and excellence at higher plane. “Provide appropriate financial incentives and rewards, and non-financial praise for the employees’ achievement” (Armstrong, 2004, p.336). Now ever since the recession turned its ugly head on the companies, promotions have also become rare. Apart from cuts in promotions several organizations even scrapped training programs for their employees. Ryanair for example use one type of plane so that the cost involved in training the staff can be reduced considerably. Managers say when employees are lamenting everywhere with pink slips and escorted out of the office under an hour, the possibility of training is literally ruled out. This shows that HR practices are negatively impacted and there is minimal possibility of flexibility to save the employees. HR practices to retain the employees Human resource is one of the precious resources of the organization and it has to be managed effectively through an effective HRM processes. “The HRM perspective stresses that each activity should form part of the whole process of people management.” (Price 2002, p.17). No organization should like to loose its quality employees, instead it should recruit quality employees who can perform in all circumstance, as part of high performance HR practices. Many organizations even today have not touched the employees’ eviction process. Thus, HR managers should be more broad minded and empathetic with the problems of the employees. Salary cuts are okay if the company is considering this option instead of layoffs. HP CEO Mark Hurd announced that its 100,000 employees will all have to take pay cuts to avoid layoffs of employees. (layofftracker.blogspot.com 2009). Managers should also realize that recession is not eternal. Things are going to change in the near future and when things are bright they need bright people. Once the organizations let go the quality people it is never possible for the company to get them back. So it is in the interest of the employers that such ineffective practices should be discarded once and for all and high performance practices should be practiced. The real test comes at times of difficulty and not when days are shiny. "To gain or keep a competitive edge, managers have renewed their emphasis on innovation, shifting away from relentless focus on controlling costs" (Draft, 2004, p.4). As a manager, being nice to employees at this time of crisis is necessary. Managers should not be mere managers but they should transform themselves as leaders as well as father figure kind of figure. “Tesco has committed to filling its Christmas vacancies with employees' friends and family who have been made unemployed during the recession” (Woods). So, the thing is that managers should not take undue advantage of global recession. Instead as part of high performance HR practices, managers should optimize the employees’ productivity leading to organizational success. Conclusion Unison of workers into teams, with an urge to usher an organization into top echelons will be successful, if the manager or leader is able to optimally handle both external as well as internal crisis situations. External crisis will always omnipresent thing, because these crisis are controlled by various factors. Among the many departments, which constitute an organization, the Human Resource Department’s (HRD) role is omnipresent and crucial, as it can only boost an organization with its high performance Human practices. That is, all the above discussed positive HR practices from the recruitment stage to the retention stage including training part, motivation part, physical environment part should optimally implemented in the organization. If the HR managers with their effective HR practices, efficiently handles the crisis scenarios and also implement effective HR strategies, performance of the organization can be optimized manifold. 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