Human Resource Management - Essay Example

?Executive summary There are various functions of human resources management and there are different approaches taken by the management in terms of managing the human capital. The soft and hard approaches are often implemented by different organisations depending on their structure. As such, this paper sought to compare these two philosophies in a bid to establish the advantage as well as disadvantages of each approach. A critical analysis of the case study of Toyota which uses the soft approach showed that there are various benefits that can be derived from treating the employees as valuable assets to the organisation. This approach helps the employees to be committed to their work which contributes to the overall performance of the organisation as a whole. Table of contents 1.0 Introduction 3 1.1 Part A: Comparative analysis of hard and soft philosophies of HRM 3 1.2.1 Advantages and disadvantages of the soft and hard approaches to HRM 4 1.3 Justification of the soft approach 5 1.4 Part B: Five soft approaches used by Toyota 5 2.0 Harvard model of HRM 6 2.1.1 Towards defining HRM 7 2.1.2 HRM theories 8 2.2 HRM strategies 9 2.3.1 Continuous improvement and respect for people 10 2.3.2 Effective teamwork 10 3.0 References 11 1.0 Introduction The origins of our efforts to manage people lie in the way we view others and make judgement about them (Hall, 1988). For Hall (1988), the philosophies of human resources management (HRM) are those assumptions about people and the workplace and their abilities and needs and these form the foundation of managerial actions. From this assertion, it can be noted that there are mainly two philosophies namely the ‘soft’ and ‘hard’ approaches to HRM which are applied by different organisations. As such, this paper seeks to provide a comparative analysis of the soft and hard philosophies of HRM as used in American and Japanese corporations. The main discussion is based on the given case of Toyota. The paper starts by outlining the differences between these two philosophies and it attempts to highlight the advantages as well as disadvantages of each philosophy. The second part of the paper will focus on the concept of HRM applied at Toyota. 1.1 Part A Comparative analysis of the hard and soft philosophies of HRM The main difference between soft and hard philosophies of HRM is that the soft approach is employee oriented where there is a balance between work and their interests while the hard approach is performance based where organisational productivity is given priority. The other difference between the two is related to the structure of the organisation which has a bearing on the HR functions. A soft approach can be applied to an organisation with a flat structure like Toyota while a hard approach is applicable to organisations with tall structures. In an organisation where a soft approach is applied, employees can contribute towards the decision making process while in a hard approach they are not involved. The other notable difference between the two is that teamwork is encouraged in an organisation which encompasses the soft approach while the one with a hard approach emphasises the element of increased performance. The other difference is that the soft approach encourages innovation while the hard approach inhibits innovation. Table 1 Differences between soft and hard approaches to HRM Soft approach Hard approach Employee oriented Production/performance centred Suitable in flat organisation structure Ideal for tall organisation structures Involvement in decision making Employees not involved in decision making Teamwork is encouraged Teamwork is not promoted Innovation is promoted Does not promote innovation 1.2.1 Advantages and disadvantages of soft philosophies of HRM Advantages Disadvantages Workers are motivated The organisation can lose money pleasing employees. There is consensus in decision making Some of the ideas may not be incorporated in the decisions A sense of belonging is created Employees may see themselves too powerful Tasks are decentralised to other departments May be challenging to follow the same strategic goals Development of skills encouraged Employees may desert the organisation after gaining experience 1.2.2 Advantages and disadvantages of hard philosophies of HRM Advantages Disadvantages Production is increased Workers are not satisfied with their job Effective decision making Employees may not like the decisions The leaders know what is good for the company Disgruntled employees Focus is on production Poor performance of the organisation Helps to keep the system of the company in tact Employees may not be able to keep pace with the changes in the environment 1.3 Justification of the soft approach The soft approach used by Toyota is commendable given that it is mainly concerned by the welfare and needs of the employees. This helps to motivate them such that they put optimum effort in their performance which is an added advantage to the company as a whole. The other reason is that the employees are satisfied with their job and it is easier for the organisation to retain talent. The other advantage is that continuous improvement of the employee skills helps them to keep pace with the changes that may take place in the environment. Knowledge management is a virtue during the contemporary period given that there is need for the employees to be better positioned to find solutions to the problems they may encounter in their operations. 1.4 Part B: Five soft HRM practices There are more benefits than costs of the soft approach taken by Toyota as going to be explained in detail below. Team work is promoted at Toyota and this is a very important aspect in the operations of any organisation. It promotes the creation of new ideas which can positively contribute to the overall performance of the organisation. Respect for people is another good approach used at Toyota where the employees are treated as valuable assets to the organisation as a whole. Conflicts which can be counterproductive are minimised. Creativity and innovation are also encouraged and this approach is very good given that the knowledge of the employees is constantly developed. The organisation is in a position to operate viable which can also contribute to its productivity. The other soft approach is stable employment which makes it easier for Toyota to retain talented and skilled workers. The organisation does not waste money through constant recruitment of employees. The other approach is increased support for balancing work with childcare. This improves employee commitment to the organisation which makes them productive. Their satisfaction with the job is also improved. However, this can be costly to the organisation given that it may be paying people who are not productive while attending to their children. However, teamwork, respect for people as well as creativity and innovation are very important during the current period. Workers are developed to the extent that they can keep pace with the constant changes taking place in the environment. 2.0 Harvard Model of HRM According to information obtained from the following website , (2011), the Harvard Model of HRM is “based on an analytical approach and provides a broad causal depiction of the determinants and consequences of HRM policies.” From this assertion, it can be noted that the HR policies are influenced by situational factors that are either within the organisation or in the external environment. These factors ought to be taken into consideration in order to enhance the effectiveness of the organisation in the long run. This model tries to map the factors that can be taken into consideration with regards to employee effectiveness. This model can be illustrated diagrammatically as shown below. Secondary source: . 2.1.1Towards defining HRM HRM is a system of philosophies, policies, programmes, practices and decisions that affect the attitude, behaviour and performance of the organisation so that they are satisfied, perform and contribute to the organisation towards the achievement of its goals (Amos et al, 2008). As can be noted in the case of Toyota, the organisation has put measures in place that are meant to ensure that the interests of the employees are given priority so that they can put optimum effort in their performance. HRM can also be simply defined as the process of dealing with the issues related to human capital such as recruitment, training and development, addressing the employees’ grievances as well motivating the staff among other factors (Robbins, 1993). 2.1.2 Goals of HRM This is a twofold process where there is need to fulfil the needs of the employees while at the same time addressing the needs of the organisation in a balanced way. These two aspects are interrelated hence one should not be compromised for the benefit of the other as can be noted in the case of Toyota. 2.1.3 HRM theories Douglass McGregor (1960) proposed that managers have personal theories regarding the nature of people at work which become the cornerstone of management of their behaviour (Robbins, 1993). He proposed two distinct views of human beings: one basically negative, labelled Theory X and the other basically positive Theory Y. Theory X Under Theory X, the assumption is that employees dislike work, are lazy, dislike responsibility and must be coerced to perform (Robbins, 1993). This theory suggests that people ought to be threatened with punishment in order to achieve the organisational goals. This approach is usually taken by managers who are more concerned with performance of the employees as well as productivity of the organisation as a whole. This theory is characteristic of the hard approach to HRM where there is little concern for the welfare of the employees since priority is given to the productivity of the organisation. This theory is not applicable to the case of Toyota. Theory Y In contrast to the negative views of human nature, McGregor assumes that employees like work, are creative, seek responsibility and can exercise self-direction (Robbins, 1993). If the people are committed to the objectives, they can have self direction and control and this approach is based on the soft philosophy of HRM. This approach is employee oriented given that there are measures in place that are meant to satisfy the needs and interests of the employees. This is the approach taken by Toyota whose operations are guided by two pillars namely: continuous improvement and respect for people. This emanates for the belief that people can put optimum effort in their operations if they are treated like valuable assets to the organisation. Contingency approach This approach also forms the theoretical perspective of HRM in that it suggests that leadership behaviour is subject to the situation in which the leader and follower find themselves in (Amost et al, 2008). The aspect of behaviour is prioritised since it characterises the nature of the human being. Likewise, the behaviour of the people is shape by various factors hence there is need for the HRM to take into consideration these factors in order to contribute meaningfully to the operations of the organisation. 2.2 HRM strategies In brief, a strategy is a long term decision that is meant to improve the competitiveness of the organisation through adding value to its operations (Werner, 2005). Toyota seeks to create sustained competitive advantage through adding measurable value to the organisation by virtue of prioritising the needs of the employees. The two HRM strategies used by Toyota include the following: respect for people and effective team work. 2.3 1 Continuous improvement and respect for people: There is a strong belief at Toyota that the employees are the organisation’s most valuable assets. If the needs of the people are met, they are also likely to be satisfied which motivates them to put optimum effort in their performance. This is the driving philosophy behind the organisation’s soft approach to its HRM processes. 2.3.2 Effective teamwork and individual efforts: This is another strategy used by Toyota where teamwork is promoted in order to enhance the effectiveness of the organisation. Through teamwork, knowledge is easily generated and shared among the employees and this is very important in the performance of the organisation as a whole given that the employees are better positioned to keep pace with the changes obtaining in the environment through constant development of their skills and competencies from the knowledge they gain from the other employees. All these strategies are supported by good communication within the organisation. Over and above, it can be noted that the soft and hard philosophies of HRM are applied to organisations in varying contexts given that these oppose each other. As noted, Toyota uses the soft approach in its operations with regards to human resources management. As discussed above, the advantages of this strategy outweigh the disadvantages hence it is recommendable for Toyota to keep this strategy since it significantly contributes towards the overall performance of the organisation as a whole. 3. References Amos, TL et al 2008, Human Resources Management, 3rd Edition, JUTA, CT. Grobler, P Et al 2006, Human Resource Management, 3rd Edition, Thompson Learning, London. Hall, J 1988, Managerial philosophy: The cornerstone of managerial competence, Woodstead Press, Woodlands. Harvard Model of HRM, 12 November, 2011, viewed 12 November, 2011, . The Harvard Map of HRM, 2008, Viewed 12 November, 2011, . Robbins, SP 1993, Organisational behaviour: Concepts, controversies and applications.6th Edition. Prentice Hall, NJ. Werner, H et al 2003, Organisational behaviour, Van Shaik Publishers, Pretoria. Read More