Human Capital Management in an Organization - Essay Example

The dimensions given here include gender, race and ethnicity, age, and talent that are possessed by individuals. Other aspects of diversity include education levels, religion, sexual orientation and personality types (Rice, 2005).

Effective management of diversity within an organization can be a source of competitive advantage in business. A competitive advantage refers to a marketing action that a company employs that sets it apart from its competitors. To understand how diversity can affect a firm's competitive advantage or competition, in general, it is essential to explore some of the benefits of diversity to an organization.   

Firstly, diversity brings a great variety of opinions and viewpoints to an organization. In a case where the management wishes to make a decision, the difference in opinion, as presented by different members, gives a broad perspective of the subject. This will lead to the selection of the best possible set of actions that can yield best results.  Restricted or few opinions can be misleading resulting in poor business decisions that might not compete fairly in a business environment.    

Secondly, diversity can result in a wide range of talents in an organization. A variety of talent is a major contributor to the efficiency of a firm. Matching the different talents to the different tasks in an organization will lead to better execution of tasks. Efficiency in tasks is a major competitive advantage. This is because efficiency in production can lower the costs of production, and the saved resources can be channeled elsewhere within the firm for improvement of services.

Finally, the diversity of a firm is a basis for the provision of a wider range of services. In marketing, for instance, cultural diversity of a firm can play a major role in reaching a broader market. An organization with a workforce of diverse cultural background is better placed to reach a multicultural market. It is possible to achieve this by understanding the different requirements of the cultures and the language to be used in marketing the products in a creative way (Pride, Hughes & Kapoor, 2012). Through cultural or language understanding, the firm is better placed to provide customized services and products than its competitors. In a global environment, diversity can also increase the market through the exploitation of the different market connections owned by individuals from different countries.

Question 6: Head of HR and Labor Turn Over

A high turnover of employees is an indication of a problem with human capital management in an organization. It is an indication that despite the ability of the firm to attract a labor force, the organization is not capable to retain the same labor. The effects of a high turnover rate on the firm are a reduction in efficiency and overall productivity (Baltagi, 2006). The high turnover will affect the use of a firm's resources in training new employees at the expense of other departments of the firm.

 It is essential to find modalities to reduce this high turnover rate and restore the firm back to high productivity. In achieving this objective, there is a need of attracting and retain talent within the organization. The first task is an analysis of the current situation and the reasons for the high turnover rate. It is through the identification of the problematic areas that a human resource manager can identify the reasons for a high turnover rate. The next stage then involves the formulation of a strategy for retaining talent within an organization. For the purpose of this literature, the general strategies for retaining employees or reducing turnover rates are given.   

Employees could be exiting a firm due to the harsh working environments imposed by the management. Such employees are either displeased with the management style or the working conditions provided. In order to make this correction, it is important to create a condition where people are free and comfortable. An enjoyable environment at work reduces fatigue and improves employee productivity (Koontz & Weihrich, 2007).

Another strategy is to offer good compensation that is equivalent to the level of work done. This strategy involves a change in the wage and personnel policies of the organization. The introduction of a relative wage by experience, promotions after appraisals are some of the techniques that can improve retention (Brada,  & Singh, 1999). The human resource manager can also consider the adjustment of wages based on industry standards. This way, the employees do not have to seek better pay in other firms.

Other aspects of compensation that are of importance to employees include insurance (medical) and retirement benefits. The employee compensation package should clearly indicate these aspects of compensation compared to other firms in the same industry (Maddalone, 2004). The better the rates offered by a firm, the higher the chance of retaining quality talent within the firm.

Other means of retaining and improving the available talent in a firm include providing education assistance, employee motivation, and a good relationship between the management and the staff. A hostile environment and noncordial relationships only serve the purpose of heightened tensions and reduced productivity. The management can also consider having flexible working hours for the employees. This way, the employees do not have to choose between personal commitment and work. It will also reduce absenteeism from work or lateness (Maddalone, 2004).