HRM in Private Enterprises - Literature review Example

Purpose of Study/Problem Statement Zhao & Yuan & Guo (2011) in their paper “Brief Analysis on Human Resources Management in Modem Private Enterprises” have presented a thesis on how the concept of Human Resource is different from the traditional notion of personnel department and that the proper management of human resources plays a very important role in bringing success to the business in the long run. Recently, in China, private enterprises are providing a big boost to the economic development of the country. However, the hypothesis made in this paper points out that the lack of efficient management and overseeing by the human resources lead to slowdown of several private enterprises that had grown successfully at the initial stage. Research Questions or Hypotheses The research question holds a central position in a research paper. It addresses the idea, in brief, that the researcher explains in course of his paper. Generally the research question is stated specifically, although sometimes, to address complex issues multiple questions have to be mentioned. A common phenomenon observed among the Chinese enterprises is described by the phrase “lasting briefly, and growing with difficulty”. With passage of time the mindset of the people has undergone changes along with economic development of the country. In the later part of the 1980s the term “Private Economy” emerged in China. The economic entities which are invested into by a non-government body or a private enterprise or individual and run by them are known as privately operated economy. These are based on private resources and do not embody the state capital. There are several small and medium enterprises that are emerging in the country based on private investment. Such firms although fare well in the initial phase, sometimes cannot grow further later on. It is quite difficult for any enterprise to hold on to its existence if it becomes stagnant. The hypothesis made in this paper is: whether the difficulties faced by the private enterprises is owing to the problem arising in the management of their human resources. Literature Review The literature review of a research paper provides guidance in the formation of theoretical and conceptual framework required for the study. This builds the base on which the entire research work is rooted. The literature review provides the backdrop for the research work and shows further avenues for conducting research. In this current paper, the theory of small and medium private enterprises in China and their basis of management have been well established. Consequently, the authors have discussed the hurdles that these firms face and the links between these problems and their improper management structure. Conceptual Framework The conceptual framework pertaining to a research work is inclusive of three broad things; the problem to be addressed, the literature review and the purpose of research. Foreign companies operating in China had brought in the term “Human Resources” into China. In simple words, the term refers to the workers that work in a certain organization and their capability to do productive work. They are an integral part of an enterprise since the development of the firm, both economically and socially, depend to a great extent on the human resources of the firm. The workers’ effort can be categorized into two divisions; the physical work and the intellectual work. Not only does the quantity of the production made by the workers put an upward thrust on the performance of the company in the market, but it is largely dependent on the efficient management of the resources that would lead to a good quality of their performance. Human resources management thus plays a crucial role in any organization’s administration for it to remain healthy over time. By ‘effective human resources management’ one emphasizes on the management of the human resources in a reasonable and scientific way. A reasonable utilization of the human resources is very important. The behaviors and ideas vary from person to person and a close monitoring of these is necessary for achieving business goals. Sample This research paper is based on secondary survey made on the small and medium enterprises of China. Selection of sample is a crucial element in any research endeavor. The methodology to be followed largely depends upon the type of sample chosen as well as the size of the sample. Since this is a study based on secondary information, primary data is not available for analyzing. But the group of small and medium private enterprises that has been chosen as sample serves our purpose well. Research Design The research design adopted for the study reflects the pattern in which the study is made and inferences are drawn. The results obtained from the study are correlated to the design of research. Thus it spells out how important it is to select a very suitable blueprint of the plan of research. The authors of this research work have made extensive study from the relevant secondary resources available and enumerated the predicaments faced by the private sector enterprises. They have provided a distinct classification of the two terms “human resources” and “human resources management” and explained the ways in which better management of human resources leads good business. This provides the counter-explanation supporting the hypothesis made that the difficulties faced by the newly emerging private enterprises are in most cases due to improper utilization and management of their human resources. Results/Findings A broad analysis of the predicaments that the private enterprises find themselves in, with respect to their human resource management, has been provided in the paper. It has been found that once the management deficiencies of the private enterprises get exposed, they cannot help in running the business efficiently. Several aspects reflect such deficiencies. Sometimes an enterprise expands rapidly and disproportionately to the management officials’ capacity. In such cases or due to various other reasons, the proper cohesion within the staffs decline. Contradiction arises between the short-term goal meeting policies and the necessity to make rational choices for a long-term benefit of the enterprise. All these facts bring into the limelight the question of management of human resources within an enterprise. In the private enterprises of China, the understanding of management of human resources remains restricted to the level of managing the general affairs in the company. The officials lack a deep understanding of the human resources management and normally perform their duties by organizing and coordinating the affairs of the organization. They generally take things as the central object of importance and expect people to adapt to them. The personnel are not given proper training and emphasis is put on the utilization of the personnel rather than on proper training. Besides, the supply of human resources has not grown at the same pace as the rapid development of the private enterprise in the recent years. The insufficiency of senior personnel in the managerial positions fails to impart the vigor and stamina to these small or medium sized enterprises. In many cases the enterprises are initially started by the combined efforts of the entrepreneurs’ families and friends. When they develop over a period of time, they still remain a “domestic workshop” (Zhao, Yuan & Guo, 2011, p.233) in areas of policy-making. According to an survey, about 90% of the financial management of these enterprises is controlled by family members. 40% of the senior managers come from the family members or their friends (Zhao, Yuan & Guo, 2011, p.233). Thus they lack the professionalism which would act as a step ahead for further development. One more hitch indicated by this study is that these enterprises do not have many staff having multi-tasking abilities. The education of the people at the management level might not either be sufficient for doing such a job or not in line with the requirements of that particular job. Thus the quality of work falls. Besides, in some of China’s private enterprises, comparatively more importance is laid on the usage of technology and the products and markets and lesser importance is given to human resources management. Also, often the enterprises change their workers at large for a partial change in profit. To worsen the situation, the mentality of the bosses regarding retention of the experienced employees adds to the cause. They think that acquiring workers for their organization would not be a problem since they can be easily attracted by an offer of good salary. But it leads to the loss of the senior level staff and the expertise that they possessed. Implications The results obtained from this study have certain important implications. Firstly, the exposure of the deficiencies of the management personnel hinders the smooth running of the business. In such cases it is implicit that the growth of the enterprise would be restricted. Besides, a shortage of proper training facilities for the personnel weakens their capacity to come up with better strategies of managing human resources. Since human resources hold a direct connection to an organization’s success or failure, an efficient strategy making for the managing of human resources is important. The lack of professionalism amongst the employees acts as a drawback for the organization in its path of development. Besides, the actions taken by the private companies to change their employees in large scale causes quick increase in turnover but at the cost of business development. The loss of experienced personnel is difficult to replace. It leads to loss of expertise as well as morale of the organization. Although the high salary structure may act as a means of attracting talents initially, at the later stage the employees might lose a sense of belongingness to the organization if they are not provided with some non-material incentives like training facilities, incentives for achievement or over-achievement of goals and so on. Authors’ recommendations The human resources in any organization are not static resources that can be used years on end and disposed off on getting depreciated. It has to be preserved and its productivity increases not only with proper management but also with its development. Hence it is necessary to realize the process off “transformation from the traditional personnel management to the modern human resources management” (Zhao, Yuan & Guo, 2011, p. 234). The authors have provided a number of countermeasures of the development and management of human resources in private organizations. A human resources development programme conducted in an organization and compulsion on all the employees to complete it, casts a good effect in the organization. It leads to the development on the staffs’ talent pool and strengthens the cohesion amongst them. Such a program can create a balance between the quantity and quality and the long-term and short-term goals of the firm. In the recent times, more of quality examination is replacing quantity examination in improving human resources management. A good examining system aims at perfecting the encouraging mechanism for the talented personnel. Prominent contributions by such persons should be recognized and they should be rewarded highly in terms of salary or benefits or both. The duty assigned to an employee should be in level with his or her knowledge and abilities. Training programs act as a very good method of enhancing staffs’ skills and improving their productivity. During training, the workers brush up their ‘soft skills’ besides learning practical skills. It helps increase coordination between the seniors and the juniors in the company. It is also cost effective since the firm can develop newer skills in its existing staffs and does not incur new cost in the form of hiring new recruits. Stability of the workers in an organization depends not only upon the salary but also upon the availability of facilities like self-improvements that help them go a long way in future. Thus, any loss on part of the employee would imply a loss to the enterprise. Enterprises should immediately revise the method of selection of personnel. The heritage of appointing people by “favoritism” (Zhao, Yuan & Guo, 2011, p. 235) needs to be changed. An atmosphere of healthy competition as well as of cooperation should exist within an organization. Besides, the private enterprises can establish specialized department for human resources management that will contain people from background of specialization on human resources. Limitations The study has shown a positive relationship between the dearth of proper management of human resources in modern private enterprises and their long term performance and sustainability. The condition in which the privately owned Chinese enterprises are mushrooming and growing is quite tough for a healthy and long-term sustenance. In the paper the authors have compared the condition of these non-state funded enterprises with the state-owned ones and have commented on the situation of the private organizations as difficult. But they have not elaborated the privileges enjoyed by the public enterprises or the factors that lead the government enterprises to a better position in terms of human resource management. Recommendations for future study This paper provides recommendations for future study. This research has delved into the arena of problems faced by small and medium private Chinese enterprises but much is left to be discussed about the ways of solving the issue. Comparisons with other countries might highlight newer aspects on this topic and open up newer avenues. The research approach taken in the paper is entirely based on scholarly journals. A new research can be conducted considering the small and medium private enterprises in the USA. Two companies from each of these three categories can be chosen and two managers and five executives would be interviewed from each enterprise. The interview can be conducted through distribution of questionnaires via e-mail, telephonic calls or face to face discussion if possible. This would be a primary survey and we can expect several contrasts in the outcome with the research made on Chinese enterprises. The major area of contrast might be the level of development achieved by China and USA. Level of evidence The evidences are well articulated and the sources of evidences are reviewed. Several academic journals have been used for the purpose of this research paper. Reference Zhao, P., Yuan, Y., & Guo, Y. (2011). Brief Analysis on Human Resources Management in Modem Private Enterprises. Asian Social Science, Vol. 7no. 3, pp.232-236 Read More