A critical analysis of Ulrich's Model - Essay Example

?A Critical Analysis of Ulrich's Model Introduction David Ulrich, the father of Ulrich model brought a new dimension to the practice of human resource management. He came up with a model or approach which re-defined the whole structure of functioning of human resource department. The aim of Ulrich was to bring about a change in the working process of the HR in order to make it more organized and structured. David Ulrich being a professor and an expert in human resource management gave rise to handful of principles and ideas for the upgrading of the HR working system. He is of the notion that the intangible elements of an organization play a very big role in the growth and value of a company. The model originated by Ulrich focused on allowing the human resource personnel to be more expanding and flourishing in the area of business. His ideas imparted more life to the human resource field that it became more valued and treasured. The current market utilizes his model in a very effective manner in order to change the overall face of their respective organization. Ulrich model enhanced the flexibility and workability of the business firms along with more growing opportunity to the staff and management. For the success of a given business, the approached defined by Ulrich has to be applied in a balanced way. Ulrich proves that employees in HR department can very well reach the status of an entrepreneur if works according to specific rules and design. Four Role Model by Ulrich The four role model of Ulrich throw light upon four main key elements: a) Strategic partner b) Change agent c) Employee champion d) Administrative expert. a)Strategic partner: It is all focused on the aligned working of the HR department by giving due consideration to international business standards, internal management system and business growth. Even though it looks conventional, it demands a lot of hard work and focusing from the HR staff. This role received more attention than other ones and were more applied by organization in their HR functioning. It can be definitely argued that the line managers in the present organizations are playing the role of strategic partners. In the present organizational structure to contribute to the planning functions is very essential thing. Being a strategic partner allows the managers and heads of the HR field to contribute to business planning and strategy formulating. b) Change agent: By this aspect Ulrich mean that any organization should have the capacity to change and accept transition phase with ease. This is a very important area which needs to be concentrated by the organizations in order to expand and grow according to the changing global market trends and situation. This highlights exceptional capabilityof the HR professionals in being flexible so as to provide ideas to face changes occurring in the operational phase of the business firm.This aspect will allow the business leaders in overcoming problems raised due to change factor. The role of HR staff as a change agent is very valuable as it encourages and motivates the organization to take change as a challenge and bring positive outcome out of it. This also decreases chaos and disorganization among the employees and managerial heads. c) Employee champion: By this role the Ulrich means that the HR should be efficient in advocating the employees as and when needed and also should support and guide them when the company is undergoing change. This is very crucial role as it does not leave the employees ignored and rejected about the activities going on in the firm. The main focus of this role is to bring a right balance between the resources provided by the company and expectations of the employees. This brings about competency and efficiency among employees and also helps them in resolving their issue and problems faced in the organization on a routine basis. d) Administrative expert: According to this role, the HR staff performs the function of recruiting the employees or hiring them and handles the compensation issues, training programs, rewarding function, record keeping task and rest of the activities involving staff. This role strengthens the communication link between the staff and HR and also gives satisfaction to both staff and HR department. This role can also ensure that the employees are treated in a fair manner. Critical analysis of Ulrich Model According to Ulrich, a business concern needs a complete flexible and organized human resource department in order to remain in control of its activities. He gives immense importance to the human resource staff shifting to business partnering with the help of certain constructive principles .To make business partnership successful a deliberate change in the organizational structure of human resource activities is essential. The result of such an approach is that it gives way to more efficient HR staff and a smooth flow of action between the company staff and its partners. Ulrich attempted to take bold step against the long practiced HR beliefs and practices. He provided a challenging environment to the HR staff to act and evolve. Role model as Strategic partner The strategic partner concept by Ulrich is a much appreciated role as it emphasize on working together with business leader on strategy development .Most of the business experts are of the opinion that HR should play a defined role in the business strategy of an organization. To practice this means being more cost effective, structured, customer oriented and flexible. Accerta(2011)concludes that “IBM, PWC, Towers Perrin and others all recently asked their CEO’s about their top priorities. Top five answers included execution of strategy, talent management and development of leadership. CEO’s are screaming for insights into how things should be done to support HR professionals. Good HR managers develop an excellent sense of business and have an impact on the business.” This shows the importance of applying strategic partner concept to the organization to have a balance management of the activities. Role as a change agent The HR functions and objectives are not static in nature, since change agent is an important role to be adopted by organization for a smooth functioning. In order for the HR functions to be fruitful, adherence to both strategic and change agent role is very important. In order for a business concern to reach its goal, adaptation to changing atmosphere is very crucial. Williams(2009) refers that “A divisional vice president of HR at a Fortune 500 pharmaceutical company noted that a challenging economic time can position HR to be an evangelist of key messages to the organization. In the case of the pharmaceutical company, that message was “stewardship Despite a record year in 2008, the VP said, the organization needed to manage both its spending and employees’ fears of layoffs—without making them complacent”.This shows that if the companies are not ready to accept the changing economic situations, it can face loss or downturn. In the case of above example the pharmaceutical company needed more cost efficiency and manpower management. Role as an employee champion According to the frame work of Ulrich, the organization has a very prominent role as an employee champion. In this role the organization puts forward to a great interest in standing by the needs and rights of the employees. The main areas of focus were health care and safety measures of the employees, balancing their personal life with their work developing creative and innovative policies and plans for assisting employees in their routine activities. According to Long (2006,p.88-100) “An HR professional as employee champion strives to understand the need of the employees, attempts to meet those needs, and provides every opportunity to increase employee commitment”. But in some cases there can be inefficiency in this role because of lesser interaction with the employees of the organization .The reasons can lesser number of HR staff, centralized structure of HR department or different work timing of the workers. Role as an administrative expert As per Luke( 2009)“HR Employees their HR administrative expert role mainly in two areas of the reengineering – by providing the support and participation at the reengineering of the business processes and by doing the reengineering of the HR Processes to build stronger and more effective HR Organization”. With this it can be understood that the key function of HR administrative expert can also be in business processing and guiding employees in order to bring quality work with optimal efficiency. The system of any business operations can be re-engineered with the help of this role and this can result in the growth and expansion of the organizations.This role in order to effective requires the HR employees in different areas of the organization to be concentrated on. Big corporate have offices world wide and effort should be made to give emphasis on entire staff on wider geographical area basis. Three legged stool version This is a modern version of Ulrich model which is used by much organization in the current business. It has proven to be very successful and is practiced by many organization to bring a balance in their HR functions and staff, According to this version there are three functions which can be explained as follows. Shared services: In this function a single unit handles all the daily transactional activities involved in the business. It looks after the payroll system, guides on the employee’s issues, tracks the absence of employees and performs resorting as well. Center of excellence: In this HR experts with exceptional knowledge and skill with regard to HR functioning provide solutions to HR related problems. This function focuses on educating the employees and rewarding them for better performance and also brings about innovative concept in HR department. Strategic business partners: In this the Hr experts work in collaboration with the business leaders and motivate them to formulate and implement better strategies. The spectrum of this function can solely depend on the size and nature of the firm. Metzler(1998)writes that “Successful HR professionals must chart roles that include early and active involvement in key strategic business choices. They must become the partners of decision makers, sharing accountability for organizing work -- including where it is performed.” Critical analysis of three legged version with realted to each role Shared service: This is a very important aspect which keeps the functioning of big corporate and business partners moving. It provided ease in performing activities which require enormous time, energy and cost. As per Blunt(2004) “HR is weighted heavily with transactional services such as benefits administration, records management, payroll and training administration. These types of services make up approximately 65 percent of HR's work, so there is no logic to having them decentralized, believes Barb Quinn, founding partner of the consulting group 22c Partners in Toronto and Vancouver, Canada, and co-author of Shared Services: Mining for Corporate Gold”This explains that major part of the HR department is reduced by shared experience service. Centres of excellence: An organization essentially needs centre of excellence in order to excel the performance quality of its employees and also to motivate them in the appropriate manner. In this function HR experts guides the organizational heads about the methods which can organize and appreciate manpower .AHRI(2011)claims that “AHRI's Centre of excellence focuses on the development of the HR profession. It is responsible for conducting research, administering AHRI's National Mentoring and Awards programs, overseeing the content for AHRI's publications, facilitating specialist area events and forums, engaging in government advocacy and building relations with media outlets to equip HR professionals with needed knowledge”. This indeed defines an organization has so many spheres of activities which need the support and guidance of HR experts without which it cannot sustain and expand in a balanced way. Strategic business partners: This is also very crucial function in which the HR experts work with business leaders in order to make innovative strategies and plans so as to maximize the utility of its resources and manpower .The integration of strategies related to people and business can be an active part of HR professionals role if there possess the right kind of skill and expertise .The old and traditional practices and believes have to be discarded and new innovative strategies and ideas have to be conceived by HR experts working in hand with business leaders. According to Smith(2008)“In General Electric's recently published 2008 annual letter to shareholders, the CEO Jeff Immelt stated the following: ".....The secret to all of these dimensions of developing leaders is to have a great team of human resource professionals. Enduring companies must have a passion for people. GE has a great HR team that protects our valuable human assets. For years, GE has acknowledged the success of Bill Conaty, their Senior Vice President of Corporate Human Resources”. A critical analysis of the evidence and views of those who say the model has been successful. Example 1 : Ceridian As per Ceridian(2011)“Ceridian's Chief People Officer Karan Paige underlined the value of HR Business Partners with experience in the business as key drivers of a successful organization. Ceridian adopts this model internally. As an outsourcing company, we make full use of our facilities and outsource our payroll and HR administration to our modern HR shared service centre in Glasgow. Our Business Partners are aligned with functional teams and work with senior leadership team members to design and deliver people plans that enable Ceridian's strategic and operational objectives. 50% of our Business Partners have spent time in the operational areas of our business before joining the HR team”. Critical analysis This defines the benefits and advantages of the ideas and principles of Ulrich in assisting the organization with HR administrative activities and strategic planning. Here it can be seen that the specific firm has applied the business partnering concept to their working structure and achieved positive results. If the roles suggested by Ulrich are applied correctly, then the result s can be very prominent. Example 2 : BAE Systems In Human Capital(2011)it is said that “BAE Systems recently under took a serious commitment to enhance the competencies of its HR professionals.  As a result of the developmental program, HR’s perceived impact on business performance increased dramatically (the percent of line managers rating HR as 4 or 5 in business effectiveness increased 120%.). The reality is that the HR professionals must evolve into being the best thinkers in the company about the human and organization side of the business.” Critical analysis HR professional are the core part of any organization and giving due attention to them can benefit the organization in many possible ways. Here we can see that involving HR experts in business decision making can built up their confidence as well as the decision making skill of business leaders. A business can not survive solely on the ideas and concepts of certain group of people, decisions have to be undertaken by evaluating the ideas and thoughts of experts and competent people in human recourse department. Example 3 : Hewlett Packard As per Ellis(2007)“In HP, Holland describes how Seeley’s skills as an HR strategic partner make building relationships with the client team much easier. “She builds relationships at VP level, talks credibly and listens carefully; she assesses issues and makes decisions well and quickly, ”he says. “Having respect at such a high level makes my job much easier – it positions me as a trusted advisor”. Critical analysis HP is a huge corporate and implementing strategic partner role has shown to have brought great success to them. The company has achieved ease in dealing with its clients in a more potential way which made their business perform smoothly. In this kind of alliance with other partners the two sides get benefited and can also have a platform to share ideas and values in order to enhance further in their area of business. Example 4: Procter& Gamble Overell(2006)writes that “Employee Champions leap tall issues in a single bound! Become an Employee Champion and you'll work to support, develop, enable, and empower P&G employees — helping to create the optimum environment for productivity and satisfaction.” Critical analysis This shows the importance the p&g gives on the role of employee champion in order to initiate and motivate its employees. This is a very potential role in Ulrich model which demands on giving time to understand the issue and problems faced by staff .This function increase the confidence level of the employees and also the productivity of them. Indeed the proclamation of the successful organization like Procter& Gamble definitely portrays the value of this role in the business field. A critical analysis of the evidence and views of those who say the model was not practical and efficient Example one : Criticism on Ulrich model As per TUC(2007)“Exclusive new research from Personnel Today and the TUC today (Tuesday) reveals that a surprising 92% of union reps believe they are sacrificing their careers in order to represent their colleagues even though they enjoy a largely positive, professional working relationship with their organizations' HR departments. More than nine in ten union reps (92%) responding to the survey think their career prospects have been hampered by their personal involvement with unions. Some 38% believe this is definitely the case and 54% believe it is possibly so.” This aspect is about the employee champion role practiced by the companies and the negative impact it has on the employees. Employees experience that this role hinders their career growth and give less time to improvise them. Looking after the issues of other staff has given less time to concentrate on self issue and problems .They feel even though this role is beneficial it can create obstacles in the growth of individual employees and avail them with decreased time and energy to expand one self. Example 3: Criticism on three legged tool (Shares service) According to Shared service (2002) “specialist in shared service centers, Akris.com, states that "savings of 25 to 40 percent [are] already demonstrated" whilst PricewaterhouseCoopers (USA) state that cost savings are "typically 30-50%". Within the Public Service, departments are not able to set up a separate company to act as a shared service centre between departments. Consequently it is likely that a shared service centre would be based in one of the participating departments, raising concerns among the others about their access to services. They have also identified contracting difficulties in determining how the shared service centers would priorities in times of heavy demand (e.g. all departments must produce their parliamentary reports at the same time).” This shows the problems arise in practicing the shared service role, when there is number of departments involved in an organization. In public sector it can be very beneficial, if things are organized and implemented in a proper way .Access to the services to all departments is also very important criteria in order to avail maximum benefit of the shared service to the entire team. Sometimes an organisationwith shared service is forced to compromise on certain important professional services which can create difficulty in operations of the firm. Example 3 :Criticism onUlrich model In TP (2008)“A 1997 survey by the Treasury Board of Canada Secretariat and the Personnel Renewal Council found that the number one reason for bringing outsourced HR functions back in-house was poor quality of service by the outsourcing provider. When organizations search for outsourcers, they need to look at their track record, and should ask to see detailed references from their customers. To attract the best outsourcing provider for the job, organizations should clearly define their requirements from the outsourcing initiative and the objectives they hope to achieve. They should also select a provider whose culture and working practices are compatible with theirs”. This explains that the outsourcing is not evidently some functioning with less of faults. As per above example the company withdrew its outsourcing facility as the quality of its service was minimal. The organisations have to be very careful when they select an outsourcing provider. It is very important for the outsourcing providers to have good reputation and face value to help the business partners in an efficient way. HR outsourcing has to be delegated after a careful evaluation and background check o f the service provider has been made. They should also be imparted with the right amount of information so as to the organizations objectives and goals to get him right results. Conclusion Ulrich model is a very successful and widely applied model in the global business market at the current stage. It has been proved very successful to many corporates and international organizations. Ulrich asserts on the HR professionals taking on further step by developing in to business partners, action takers and pioneers. He asserts that HR activities should give added value and benefit to the organization and its employees collectively. The HR functioning should aim at increasing the capabilities of the company as well as the competency of the employees working in it. If the HR department works by giving consideration to the needs of the customers in and out of the firm then the success of the company is inevitable. The Ulrich model defines four models needed in order to develop an efficient working system in an organization. Lawler(2003)states that “A number of studies have investigated the potential for the HR function to be a strategic partner and found that it can be a value-added function. Likewise, there has been more speculative than empirical examination of what it takes for HR to become a strategic partner”. According to Ulrich it is not merely sufficient to adhere to the roles prescribed by him, but foundation of the working process of the organization also must be strong from all aspects. The concepts of Ulrich are now older than 14 years and is routinely updated and followed by numerous organizations. Ulrich says that the model constructed by him is not recommended to be followed religiously. He emphasized that it is not the Ulrich model that is important but the premise that its is built on. It can be said that few organizations hold a misconception of being successful by just following the model of Ulrich. This is a very uncertain thinking as any business can operate smoothly and grow efficiently if different factors are taken into consideration in the right manner. However, the model which is growing considerably is the three legged version of Ulrich model .The sophisticated principles and concepts of this model has enables corporate giants to achieve new heights .HR outsourcing which is a branch of this concept has impressed number of business corporate with its ability to provide them with numerous benefits and offer different variety of services. When business processes are handed over to various service providers there can be a decrease in the work load of the organization which give them space to perform other activates which are crucial. The valuable principles of Ulrich have given key importance to the HR activities and its potentiality to enable the growth of organization with the proper guidance and support from HR experts. Bibliography Accerta. 2011. www.goingforhr.be. [ONLINE] Available at: http://www.goingforhr.be/extras/web-specials/hr-according-to-dave-ulrich#ppt_2135243. [Accessed 19 January 11]. AHRI. 2011. Centre of Excellence. [ONLINE] Available at: http://www.ahri.com.au/scripts/cgiip.exe/WService=AHRI-LIVE/ccms.r?PageId=5. [Accessed 20 January 11]. Blunt.M.F. 2004. Keeping HR on the inside: the shared services model provides an alternative to outsourcing HR that can yield the same cost savings and customer service enhancements. [ONLINE] Available at: http://findarticles.com/p/articles/mi_m3495/is_10_49/ai_n6254339/. [Accessed 20 January 11]. Ceridian. 2011. What is the HR Business Partner Model?. [ONLINE] Available at: http://www.ceridian.co.uk/hr/newsletter/nav/1,4813,924,00.html. 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