Development of Organizational Capability at SISCO - Article Example

Company Introduction SISCO is a private organization which was established in the year 1983. The company addresses many problems related to electric utility and manufacturing industries (SISCO, 2009). The company is into offering communication systems and other application integrated produces which are usually used in many industries globally. "SISCO's mission is to provide world-class, real-time communications and integration solutions to OEM and end-user customers in the energy utility, manufacturing, and other vertical industries based on open internationally accepted standards (SISCO, 2009)." The speciality of the products of SISCO is that of reducing cost and time so that the customers have the ease of adapting emerging and existing technologies. The solutions offered by SISCO are even cost effective. The following are some of the products and services offered by SISCO. "IEC 61850 Substation Automation Networking:'' Inter-control Centre Communications Protocol (ICCP - IEC 60870-6 TASE.2) Utility Integration Bus (UIB):' Products for the OSI soft PI System' 'Manufacturing Message Specification (MMS) Controls Design and Systems Integration Services (SISCO, 2009)" In a large transnational organization of the size of SISCO, certain key initiatives that were initiated by the leadership team to acquire, retain, groom and manage talent are discussed in detail in the remaining part of this paper. Human Resources Management - An insight Human resources is one of the most valuable and unique assets of an organization. According to Leon C. Megginson, the term human resources refer to "the total workforce, as well as the values, attitudes and beliefs of the individuals involved (Noble, 1985)." Management as a process involves planning, organizing, staffing, leading and controlling activities that facilitate the achievement of an organization's objectives. All these activities are accomplished through efficient utilization of physical and financial resources by the company's human resources. Human Resources management is one of the most complex and challenging fields of modern management. A human resource manager has to build up an effective workforce, handle the expectations of the employees and ensure that they perform at their best. He/she also has to take into account the firm's responsibilities to the society that it operates in. Human resource management deals with the "people" dimension in management. In their book Human Resource Management, Byars and Rue, say "Human Resource Management encompasses those activities designed to provide for and coordinate the human resources of an organization (Rue, 2000)." According to Ivancevich and Glueck, "Personnel or Human resource management is the function performed in organizations that facilitates the most effective use of people or employees to achieve organizational and individual goals (Glueck, 1995)." Every organization is composed of people and utilizing their services, developing their skills, motivating them to enhance their levels of performance and ensuring that they remain committed to the organization are essential for the accomplishment of organizational objectives. This is true for all types of organizations - government, business, education, health, recreation and social action. Acquiring and retaining good human resources is an essential pre-condition for the success of every organization. Organizations that can do this will be both effective i.e. they will be able to achieve their goals as well as efficient i.e. they will use minimum resources necessary to achieve their goals. Inefficient or ineffective organizations face the danger of stagnating or going out of business. Competent managers and workers are essential for the coordination of efforts towards the ultimate objectives which ensure the survival of the organization. Though such coordination alone cannot guarantee success, the lack of it can lead to failure. In the changing times, it has become evident that it is the human resources of an organization or a country that can lead it on the path of success. It is the competencies and attitudes of the human resources that can make or break a business. The business of attracting and retaining talent and nurturing it has become imperative for the development of an organization. Innovative and proactive HR managers have been defining new boundaries of HRM. The turbulent and dynamic markets and the changing values and expectations of the workforce have made the earlier concepts of personnel management irrelevant. A new strategic role has emerged for HRM - that of a key player, to make the organization survive and succeed in a highly competitive business environment. Business has become knowledge based, service oriented, competitive and more dynamic in this new age. The quality of human resources has become an essential factor in determining the success of any organization (Flippo, 1984). In the words of Eric Flamholtz a renowned HR consultant and a Professor at Anderson Graduate School, human resources accounting is defined as "accounting people as organizational resources. Human resources accounting is measurement of the cost and value of people for an organization (Flamholtz, 1999)." Till recently, people were not accounted as resources and no value was attributed to their contribution. However, in recent times, the criticality of the contributions of human resources have been acknowledged and recognized. Hence, the concept of attributing an appropriate value to the worth of human resources of an organization has become popular. Human Resource Accounting helps management to value its human resources and use it with discretion and wisdom. It also provides essential information to the management to maintain and develop its important resources (Ramlal, 2003). Hence, human resources accounting is considered to be an appropriate technique to measure the effectiveness of the Human Resource in an organization. The need for people orientation is being increasingly felt in most modern organizations. For example, after it realized that pressure of work was making it difficult for its employees to balance work and their personal life (Keerti, 2008). Another major issue is Team orientation. This refers to the level of importance laid on effective team work as compared to individual efforts and contributions to the organization. The business environment has become very fluid and turbulent in the recent times. This is especially true in most of the emerging economies of the world today. The markets have become very competitive and businesses have been forced to become more service-oriented. In this scenario, it is a very challenging task to attract, mould, develop and retain valuable human resources. The expectations of the employees have also increased as more and more of them belong to the category of knowledge workers. They are in demand and they are in a position to choose their employer, and none except the best would do. Worker Productivity is one important aspect that helps measure the effectiveness of HR function (Another Hat for HR: Negotiatior- in-Chief, 2003). In today's highly competitive markets factors like world-class quality, flexible manufacturing, and shorter product development cycles are not competitive advantages but prerequisites for survival. Companies are reinventing themselves to stay ahead of the competition. One of the major steps taken in this direction is a complete revamp of organisational culture and structure. Tall hierarchies and communication barriers have been dismantled. Business decisions are no longer taken within the confines of the board rooms. They are taken in place of work, on the shop-floor and in the market, because that's where the action is. This new concept of empowerment gives the employees a feeling of belonging and commitment towards the organization. The fact that they are accountable for their decisions makes them more responsible and keeps them motivated to better their performance. The most powerful way to demonstrate the value of HR is to quantify its Contributions. Companies are used to measuring the output (or, more specifically, value) of different departments by looking at their numbers. People tend to be more confident with fact-based and quantitative approaches (hrsincome.org). For example, The sales department flaunts its muscles with its growing sales figures. The marketing department highlights its efficiency with cost per thousand figures and celebrates its charm with every successful customer defection. The customer service department highlights its importance by logging every feedback or compliment received. Apart from both the tangible and the intangible benefits that can be enjoyed by the "HR team that actively manages perceptions surrounding its work, there are other important reasons to justify the need to demonstrate the team's effectiveness. HR effectiveness, in essence, looks at the health of a HR function within a company. To obtain the full health report, there are a series of activities a company can undertake (hrsincome.org). Importance of Organization culture to organizations Organizations comprise of human beings who are highly complex and unpredictable in nature. The management of organizations is therefore a challenging task. Increasing diversity, knowledge and information explosion, strategic partnership, global competition and emphasis on total quality management are the other challenges confronting managers in the modern times ((ICMR), 2003). Organizational Culture refers to a pattern of learned behaviors that is shared and passed on among the members of an organization (Marx, 1999). It comprises of the various assumptions, values, beliefs, norms, rituals, language, etc. that people in an organization share. Organizational culture can be thought of as an evolutionary process that has been established, accepted and internalized over a period of time, by a majority of members of the organization. The presence of a strong and appropriate culture has become very essential for every organization today in order to function effectively and at the same efficiently. Organization culture is something that can be defines as the consciously or subconsciously accepted and flowed way of life or manner that helps in performing the day-to-day activities in an organization. It plays a prominent role in determining and controlling the behavior of employees at workplace. "The core values, assumptions, norms, procedures etc. that are followed in an organization constitute its culture ((ICMR), 2003)." In order to survive and grow in a rapidly changing business environment, organizations often expand their operations beyond boundaries. A blend of different cultures together is necessary in order to manage the workforce which is diverse. Adaptation to a new culture requires workforce to overcome several obstacles in the form of differences at the level of the individual, parochialism, ethnocentrism, cultural distance and culture shock. An organizational culture influences and is influenced by the occupational or industry peculiarities tied to the organization as well as the national culture of the country in which the organization operates. It is not an end result but rather a fascinating process that blends values and links individuals (B'gin, 2006). To improve performance and build capacity, an organization's culture must align with the vision held by the leadership and be accompanied by a clear way forward and a driving force. Hence if an organization is embarking on a cultural change - it must be done with fervor. A culture is as important to an organization as is a set of wings on an aircraft. They are both essential prerequisites to creating the dynamics required to reach new heights. Managing expatriates and their operations in a foreign country is also an important responsibility of the HR manager. The expatriate must learn the skills required to work in a cross-cultural team and lead a cross-cultural team (The ICFAI Center for Management Research (ICMR), 2004). It is the responsibility of the HR manager to nurture and develop an organizational culture, which encourages diversity at the work place. Saratoga, a PricewaterhouseCoopers (PwC) human resource service offering, has developed a methodology to measure HR function effectiveness. The following figure shows the methodology developed (hrsincome.org). Source: http://www.hrsincom.org.sg/Portals/0/docs/hr%20articles/pwc%20article%20feb.pdf a) The HR Delivery Model Review: Different aspects like the Corporate HR function, HR shared service, Existing outsourcing suppliers etc, are examined and then the effectiveness is hence measured. The HR delivery model is thoroughly examined through meetings with key stakeholders like senior executives across the organization structure, HR subject matter experts and process owners. Data from existing reports covering costs, service levels, scope and headcount will also be included in the review process (Glueck, 1995). b) Voice of the Customer - This review includes a survey with select HR services customers like executives and employees which covers the view of the later on issues like effectiveness of HR working with business, the HR delivery process, service quality and customer experience etc. c) Structured Interviews - A structured interview is very rigid in its structure and contents. It is based on a thorough job analysis, which directs the flow of the interview. The main advantage of a structured interview is that there is no scope for subjectivity. d) HR Activity Analysis - To find out how the HR team is dividing its time across strategic, advisory, operational and transactional activities, relevant HR personnel will receive a tailored questionnaire to clearly portray how they are utilising their time across the various domains (hrsincome.org). An organization named Gallup came out with a tool named Gallup's Q12 that helps in measuring the effectiveness of the HR function of organization from different perspectives. In recent years this tool has been used by more than 87,000 divisions or work units within corporations, and approximately 1.5 million employees. Organizations with higher Q12 scores were found to have lower attrition, higher sales growth, better productivity, better customer loyalty or other manifestations of superior performance (Rao, 2008). Organizational Leadership Leadership is probably the most widely researched area of organizational behaviour. This could be because of the crucial role it plays in influencing organizational dynamics (Trautman). According to Warren G. Bennis, the founding Chairman of the Leadership Institute at the University of Southern California, "Failing organizations are usually over-managed and under-led." Even if an organization is bestowed with sufficient resources, in the absence of effective leadership, it will not be able to function smoothly. Inefficient leadership lowers employee morale, promotes dissatisfaction among employees and affects organizational productivity and efficiency. Leadership Theories There are many theories that have attempted to explain the characteristics required by individuals to be effective leaders. There are three important theories that attempt to explain leadership - personality traits theories, behaviour theories and contingency theories. According to trait theories, leaders possess some personality traits that non-leaders do not possess at all, or possess only to a small extent. The behavioural theories explain the behavioural characteristics of leaders. Although organizational culture is a complex concept, there is a general consensus that it refers to shared norms, values and meaning that guide employee behaviour ((ICMR), 2003). Organizational culture has a broad range of characteristics like norms, innovation and risk taking, attention to detail, outcome orientation, people orientation, team orientation, observed behavioural regularities, dominant values etc (Frederiksen, 1982). Conclusion The degree of standardization of jobs in an organization is referred to as formalization. A highly formalized job is one that has to be done in a predetermined manner, leaving little discretion to the employees involved, over even small elements of the job. A strong organizational culture results in greater consistency of employee behaviour and can replace the process of formalization, as both organization culture and formalization are aimed at greater consistency in employee behaviour in an organization. The development of a strong organizational culture additionally eliminates the need for documenting rules and procedures, which is required for formalization. Instead, these procedures are internalized and become a part of employee behaviour and the values they uphold. A multicultural organization can be described as one that Acknowledges the contributions made by various cultural and social groups and highlights their interests in its mission, operations, products and services. Discourages the practice of any form of social oppression within it. Includes members of diverse social and cultural groups in the decision-making process. Is a socially responsible entity, and supports other institutional efforts to do away with all forms of social oppression. The above are many of the few aspects and frameworks which can be introduced and implemented at SISCO through which the company can improve its current position in the market and improve its performance thereby increasing its profits. Bibliography (ICMR), ICFAI Center for Management Research. 2003. Introduction ot Organizational Behaviour. Hyderabad': ICFAI Center for Management Research (ICMR), 2003. Another Hat for HR: Negotiatior- in-Chief. HR Magazine. 2003. 2003, HR Magazine, pp. Vol: 48, Issue:6, p.118. ba'lant'lar, yaz'ya verilen. 2007. Measuuring HRM. Human Capital Strategy. [Online] July 07, 2007. [Cited: May 08, 2008.] http://humancapitalstrategy.blogspot.com/2007/10/measuring-hrm-3.html. B'gin, Diane Sarah. 2006. Organizational Culture Counts. Practoce Knowledge Center. January 10, 2006, pp. 1-4. Davenport, T. and L. Prusak. 1998. Working Knowledge: how organisations manage what they know. Boston': Harvard Business School Press, 1998. Davis, John W. Newstorm & Keith. 1997. Organizational Behavior - Human Behavior at Work. New Delhi': Tata McGraw Hill, 1997. delves.co.uk. Counseling at Wrok Place. [Online] [Cited: July 20, 2008.] http://www.delves.co.uk/counselling_skills.htm. Due, Byers &. 2000. Human Resources Management. s.l.': McGraw Hill 6th edition, 2000. Flamholtz, Eric. 1999. Human Resource Accounting. s.l.': Kluwer Academic Press, 1999. Flippo, Edwin B. 1984. Personal Management. s.l.': McGraw Hill, 6th Edition, 1984. Frederiksen, Lee W. 1982. Handbook of Organizational Behavioural Management. New York': Interscience - Wiley, 1982. Glueck, Ivancevich and. 1995. Human Resource Management. s.l.': Irwin Publications, 1995. Hills, Michael D. 2002. Nature and Scope of Online Readings in Psychology and Culture. Kluckhohn and Strodtbeck's Values Orientation Theory. [Online] Center of Cross-cultural Research, August 16, 2002. [Cited: January 19, 2009.] http://www.ac.wwu.edu/'culture/Hills.htm. hrsincome.org. Managing HR effectiveness. HRsincome.org. [Online] [Cited: May 7, 2008.] http://www.hrsincom.org.sg/Portals/0/docs/hr%20articles/pwc%20article%20feb.pdf. ICFAI Center for Management Research (ICMR). 2003. Introduction to Management. Hyderabad': ICFAI Center for Management Research, 2003. IM 11 2K3 08. ICFAI Center for Management Research. 2003. Business Strategy. Hyderabad': ICMR (ICFAI Center for Management Research), 2003. ICFAI University Press. 2003. Business Ethics and Corporate Governance. Hyderabad': ICFAI University Press, 2003. ITIM International. Greet Hofstede Cultural Dimension. ITIM International. [Online] ITIM International. [Cited: January 19, 2009.] http://www.geert-hofstede.com/hofstede_dimensions.php'culture1=95culture2=50. Keerti, DR. B. 2008. General manager - Human Resources. [interv.] Please put your name here. October 5, 2008. Marx, Elisabeth. 1999. Breaking through culture shock - What you need to succeed in international business. s.l.': Nicholas Brealey, 1999. Mayo, Elton. 1933. The social problems of an industrial civilization. New York': McMillan, 1933. Noble, Barnes &. 1985. Personnel and Human Resource Administration. New York': McGraw Hill, 1985. Ramlal, Sunil J. 2003. Measuring Human Resource management's effectiveness in improving performance. Human Resource Planning. March 1, 2003, pp. 1-3. Rao, Prem. 2008. Gallup's Q 12. People at Work & Play. [Online] February 26, 2008. [Cited: May 8, 2008.] http://bprao.wordpress.com/2008/02/26/gallups-q-12/. Role of leadership in the employee withdrawal process. Graen, G. B., Liden, R. C., & Hoel, W. 1982. 1982, Journal of Applied Psychology, 67, pp. 868-872. Rue, Byars &. 2000. Human Resource Management. s.l.': McGraw Hill, 2000. Scandura, T. A. & Pellegrini, E. K. 2007. Workplace mentoring: Theoretical approaches and methodological issues. MA: Blackwell. [Online] 2007. [Cited: July 20, 2008.] http://business.umsl.edu/faculty/mob/Articles/Blackwell_2007.pdf. SISCO. 2009. SISCO. SISCO. [Online] SISCO, January 25, 2009. [Cited: January 25, 2009.] http://www.sisconet.com/. Smith, Mark Easterby -. 2005. The Blackwell Handbook of Organizatonal Learning and Knowledge Management. USA': Blackwell Publishing, 2005. Stewart, Roy Lewis & Rosemary. 1961. The Managers. New York': The New American Library of World Literature, Inc., 1961. Strickland, A. thompson & J. 2002. Strategic Management 3rd Edition. New York': Mc Graw Hill, 2002. The ICFAI Center for Management Research (ICMR). 2004. Intorduction to Human Resource Management. Hyderabad': The ICFAI Center for Management Research (ICMR), 2004. Trautman, Neal. Self-Accountability: The Ultimate Leadership Tool. Etics institute.com. [Online] [Cited: January 21, 2009.] http://www.ethicsinstitute.com/pdf/Self%20Accountability.pdf. Wayne, Cascio F. 1998. Managing Human Resources. New York': McGraw Hill, 1998. Weiss, Joseph W. 2000. Organizational Behavior and Change. Singapore': Thomas Asia Pvt. Ltd., 2000. Wild, J.J.., Wild, K.L., & Han, J.C.Y. 2008. International business: The challenges of globalization. New Jersey': PEarson/Prentice Hall., 2008. Williams, John F. 2006. Strategy Driver for Global and International Business. s.l.': Ravenwerks Information Center, 2006. Wilson, Thomas B. 1999. Rewards that Drive High Performance. New York': Amazon.com, 1999. Yoder D. Heneman H.G., Turnbull J.G.,. 1958. Hand Book of Personnel Management and Labour Relations. New York': McGraw Hill, 1958. Yoder, Dale. 1982. Handbook of Personnel Management and Labour Relations. New Delhi': Prentice Hall of India, 1982. Read More