Human Resource Planning in Volatile Environmental Conditions - Term Paper Example

Human Resource Planning Human Resource Planning in Volatile Environmental Conditions Human resource planning entails the process of aligning human resource needs to strategic plans in a business organization. This process includes among others making sure that the organization has adequate staff with appropriate skills, knowledge, and competence to help the company achieve desired goals. Volatile conditions on the other hand, are situations that present a business organization with environmental instability. These situations comprise of demographic shifts, increased competition, and technological changes. Other environmental conditions include globalization, dynamic investor demands, expanding product-market competition, and changing customer demands. These changes offer organizations opportunities and challenges for success in equal measure. These conditions cause the change the nature of human resource planning. Success in the current dynamic market requires companies to improve performance. Improvement includes reducing costs, improving quality, innovativeness, creativity, and speed aimed at productivity. These duties rest on people who make up the organization because they make both long-term and short term organizational solutions. Human resources encompass most important resources in any organization that operates with the aim of achieving success (Wernerfelt 1984, 19). A volatile business environment means that the management of business organizations must comprehend that primary means of gaining competitive advantage have changed. The business world has seen various companies collapse in the economic recession that is slowly being managed. Companies hit by the recession range from world leading insurance, manufacturing, and processing companies. National governments across the world had to salvage some the companies to save them from imminent collapse. The environment saw other companies close their operations in some parts of the world to minimise expenditure. The economic downturn did not spare national economies with Greece’s economically crumbling. The European Union is struggling to help the country resuscitate its economy. Italy is also struggling. Human resource planning must be used to develop new strategies that will help the company remain competitive in the market. Human resource planning helps the company to consider issues that enable gaining of competitive advantage. The management of companies should recognize that usual sources of success are still reliable but human resource planning enhances sustainability of success. Usual mechanisms that lead to success include economies of scale, production technology that covers both process and product, and protected markets. The input by success factors offers competitive advantage. Human resources appear at the top of the ladder in the management hierarchy of organizations. This illustrates their importance in the running of business companies. Human resources management conducts job analysis processes before recruiting qualified employees with appropriate skills for specific jobs. It also enhances commitment of employees and makes sure that the company retains the best by taking care of their welfare (Lado 1994, 31). When the human resource department does this, it motivates employees because it takes care of the needs of the workforce. A business organization enjoys a competitive advantage by creating value for its clients. The organization must focus on product and service differentiation. It is important that the company give services and products that are unique. To do this, human resources must single out different markets and treat them as individuals. The concentration should be on particular market segments or groups and make sure that the products and services they receive are effective and more efficient than those provided by competitors are in the same market (Wright 2007, 56). In the process of achieving competitive advantage, human resources take a three-pronged approach including cost leadership, focus, and differentiation. When doing this, human resources management understands that the organization’s performance relies on environmental determinants therefore, factors them during business operations. Human resource planning also pursues the resource-based approach to gain competitive advantage. This system holds that the way an organization applies a pool of resources at its disposal determines its ability to gain the competitive advantage. The resources available to the company are always valuable and the way they correlate internally determines whether the organization can attain competitive advantage. The focus of the resource-based approach is on the organization’s strategy and performance. The approach asserts that human resource planning can sustain competitive advantage by enhancing the specific competencies at the disposal of the organization. The most important area of success comes from the unique way in which the organization manages its human resource capabilities. This brings the difference between organizations that attain competitive advantage and those that fail to achieve. It is possible that companies that fail to achieve competitive advantage use human resources in a way that inhibits the best way to mobilize new competencies and in the process destroys already existing factors of value (Pfeiffer 1994, 76). This makes them fail to compete appropriately in the market and end up being vulnerable and attaining competitive disadvantage. The main cause of the difference in the performance of business organizations is the people who make up the organization and not the products, structures, money, and markets. With the exception of people, other assets that any organization holds are inert with potential value and require the input of human resources to transform them from passive resources to active resources that give value. The productivity of employees in a company is central to its profitability. Proper human resource planning adds value to its importance as a central factor of sustaining competitive advantage because it makes it difficult for competitors to imitate. Human resources planning make the company to remain a cut above others in the competition within the same industry. The biggest advantage that comes with proper human resources planning is that its success, which includes effective management of people, is not transparent. This means that competitors cannot study and immediately imitate. Competitors can push employees but not the tradition established in the business organization. Organizational culture, processes of managing people, and the effectiveness of their abilities are the soft components of business enterprises that most management officers do not give due consideration. This makes human resources the best and most lethal asset that an organization can use to gain and sustain competitive advantage (Baron 2003, 43). Competitors can pouch a specific employee but the employee cannot carry the organizational culture to the new company. In addition to this, comprehending the intrigues that a particular company uses in managing its staff is difficult because the way people work only fits into a particular system designed to suit the organization. Proper human resource planning needs various primary human resource objectives to gain and sustain competitive advantage. The human resource needs to emphasize on learning by encouraging employees to seek more knowledge. Where the training system does not exist, the department should introduce the same with more options for employees to choose. This will increase the capabilities of the staffs and in the process help the workforce to align both individual and departmental goals to the overall organizational goals. Human resources need to carry out a job analysis to identify the specific job requirements for particular jobs including the appropriate knowledge and skills that the person to perform the duties needs to have. This is important because the skills and knowledge are central to doing work that focuses on the customer (Fitz-enz 2000, 51). Customer satisfaction is the key to sustainability on the market. It is therefore, essential for human resources to develop and maintain intellectual capital. Human resource planning includes defining the organizational behavior that the company needs to develop to attain desired success in addition to attaining and sustaining competitive advantage. Human resources also undertake the responsibility of inculcating the desired culture among employees, developing rewards schemes, and valuing employees accordingly. It also makes sure that employees commit to the work and put company success behind individual success (Brewster 2000, 88). The success of the company relies on the ability of employees committing themselves to the service of the company. Commitment of employees is therefore, an important role that proper human resource planning plays to enhance success in the current volatile business environment. Organizations are easily trimmed down on the budget allocations for the human resource department during difficult financial conditions. This includes limiting or scrubbing training programs, eliminating rewards, and other employee benefits. However, human resource management underlines the value that the department brings to the running of business activities within organizations (Gratton 1999, 61). Due to the efforts of the human resource management, the functions of the department are considered the most important in business organizations currently. Human resources department made sure that the department transforms from the traditional personnel management office of the department that deals with the human resource management. The transformation further extends to giving the department strategic roles making it more relevant to the organization. The three stages of transformation enabled business organizations to recognize human capital as important assets and ensured that the management put in mechanisms that changed the way system of managing human capital. The second stage of transformation built on the first stage and linked proper coordination of human capital with organizational objectives and goals. This phase includes activities such as, building organizational culture, aligning employee and departmental goals to overall company goals (Porter 1985, 13). They form some of the factors that management of organizations puts into consideration while evaluating the relevance of human resource management. The success of any business organization depends on effective management of human capital, organizational culture, human resource policies, and practices. Proper management of these qualities makes the workforce to develop appropriate competencies that get motivated in the process and increase their commitment to the company. Strategically, the human resource department integrates the general company objectives with the aims of the workforce. The department manages people in a manner that fosters the attainment of overall business objectives through an integrated approach to its functions. These functions include a systematic reward scheme for employees, regular training programs, and standard procedures of recruitment. Human resource planning has several benefits when it is undertaken during volatile environment conditions. Human resource planning helps the organization achieve set targets and in the process enhance the survival of the company. It is the responsibility of human resource management to support and successfully implement business strategies outlined by the company. Furthermore, the business gains and sustains competitive advantage through a proper management of human resource planning. Through its training programs, human resource management encourages creativity, innovativeness, and expands the capability of the company workforce (Armstrong 2008, 31). Human resource management responds to emerging issues quickly and this increases the possible human resource mechanisms that the business organization is exposed to during its operations. Ever since human resource management became a core department within organizations, it participates in strategic planning and shapes the direction that the company should follow to achieve its aims and goals. The company enjoys cordial working relationships between human resources department and both departmental and line managers. The warm relationship is central to the success of any business organization. Human resource planning constantly improves the performance of the business in the current volatile market environments. This helps in attaining and sustaining competitive advantage to the company in such business environments. The human resource management helps the company in carrying out performance appraisals as it assesses the workforce scorecards. Through this, the management of the business organization understands the value that employees add to the performance of the organization (Schuler 2007, 29). Research shows a successful relationship between organizational performance and human resource management and this is the cause of increased interest in carrying out performance appraisals. Various studies prove that human resource management has a positive impact on the general performance of the company. This is why most business organizations adopt human resource management practices with the aim of improving both business and organizational performance. Business organizations that fail to succeed fail to evaluate the performance of their workforce. This means that they do not measure the input that employees add to the performance of the business company. The company operates without oversight over its workforce and the possibility of failure is high. Human resource management practices operate on the primary basis that the performance of any organizations depends on human capital as its key resource. The fact in their assumption is that the primary objective of a business organization is to achieve the highest financial returns by maximizing the wealth contributed by shareholders. This is the product of effective management of the performance of operations. Functions of the workforce make up operational performance in any business organization. People transform technology through processes or production from passive resources with potential value of active resources that add value to products and services (Pfeiffer 1994, 55). Human resource management facilitates the interaction by making sure that employees have the necessary competence with required skills, knowledge, and abilities to perform assigned functions. Having a competent workforce means that the organization has people who give quality output because of effectiveness in operations. The department undertakes efficient training programs, recruitment procedures, and adaptable working environment. Proper human resource planning is central to the performance of business organizations in volatile market environments as explained in this paper. Human resource management drives the performance of organizations through execution of goals and objectives. This includes understanding and appreciation of the relationship between the decisions made by the human resources department and the expected and immediate results. The human resource also attracts, develops, and retains employees through efficient procedures. This is in addition to management of talents, and developing a working environment that is conducive. 0000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000 Bibliography Armstrong, Michael, 2008, Human Resource Management, London, Kogan pub. Baron, Aaron, 2003, The key to Improved Business Performance, New York, John Wiley & Sons. Brewster, Christine, 2000, Contemporary Issues in Human Resource Management, Cape Town, Oxford University Press. Employee Performance, New York, Pearson. 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