The Role of Human Resources During a Recessionary Period - Research Paper Example

The Role of HR during a Recessionary Period Introduction: The strategic planning of an organization depends on the Human Resources Management to a great extent, as HRM plays an important role throughout the life span of an employee in the organization, including recruitment, training, development and retention. This report aims at understanding the strategic role of the human resources team even in times of recession. To do so, a through analysis of the duties of the human resources in the normal times has been discussed below. This report will also include a through analysis of the role of the human resources in the difficult economic environment as these periods tend to be very demanding. Therefore the task of HR is very important to maintain equilibrium throughout the hierarchy. The following sections will prove how the human resources operate within these periods and recommendations will also be drawn out to face the issues during the period of recession. Role of HR: The Human resource team, as discussed have a very essential role in the company. The recruitment process: A company having a strategic vision will require a continuous supply of resources (personnel). These needs are then communicated to the HR management as and when the requirements arise. A thorough job analysis is then conducted by the HR. (Bach, 2005). It is the role of the HR management to ensure that the resources recruited strategically fit into the organization and contribute positively towards achieving the strategic vision. Also if the retention process is considered, it is seen that in every organization, irrespective of the existence of retention problem, should have a retention plan. In many cases the retention plan is developed by the Human Resources Management by collecting data from attitude surveys, salary surveys, training needs analyses and exit interviews (Heery and Noon, 2001). This way, the HR management ensures that the company does not lose any useful resources due to the oversight of the needs of the employees. Also, as said earlier, it is essential that the employees recruited must strategically fit into the organization. The HR management devise the training methodologies and strategies, after careful consideration of the job specifications and the way in which the new employee will contribute towards the strategic goal of the organization. (Reid and Barrington, 2001). It is the Hr management’s responsibility to “ensure the integration of personal and organizational development for employees” (Bach, 2005, p224). Keeping the employees motivated is a crucial element to ensure the success of the organization. The HR management acts as the medium giving many opportunities for the employees to develop themselves by acquiring new skills and engage themselves in the continuous learning process. The role of HR does not stop with recruitment and training. The performance of the employee has to be continuously monitored in order to ensure that the hard working employees who have contributed to the company’s success are rewarded and are motivated to continue the good work. Looking at the process in a broader perspective, the main objective is to link the business strategy to job performance (Bach, 2005). The HR ensures that any employee is not affected by discrimination of any kind and is given all what he/she rightfully deserves. The employers are obliged not to discriminate and promote equality which is enforced by the HR management. This plays an important role in maintaining the corporate social responsibility of the employer (Heery and Noon, 2001). This will create a best employer image for the organization which is strategically important. Within the organizations, the management of reward involves two elements – reward decisions and reward processes. HR management has to make the key strategic decisions which concern the level and distribution of pay and also the extent and form of employee participation, training, monitoring and review (Heery and Noon, 2001). The modern HR department manages the reward practise in accordance with the competitive strategy and also supports the adoption of high performance work systems. Recession and the Strategic Role Periods of recession are a trial period for the Human resources team across the world. It is during these times that the HR teams need to contribute strategically to the company as well as being creative and innovative. The recession requires the HR teams to make necessary cost cuts to the processes and to develop better cost effective procedures, along side being innovative and beneficial to the company. It is essential to note that the changes are relatively simpler to make in time of growth than in times of recession and can prove to be a challenge. The innovations require including various methods to help save the company money and yet have all the functions and support to be innovative and bring the company with a number of success categories (Waldo, 2005). There are several factors that need to be focused on at times of recession. These are as discussed below. Firstly, recession requires optimized strength in terms of the manpower of the company. This is extremely essential and the better the manpower strength in the company the higher the chances of success especially during times of recession. Secondly, the human resources team is responsible to take into account the compensation benefits and be able to cut down on the costs and compensations without causing it to be a de – motivating factor for the employees as well (Strebler, Thompson and Heron, 1997). The Human Resources teams are also responsible to and require considering the productivity and efficiency of the organisation as a whole. By this it simply means that the team requires analysing the efficiency and then redesigning the training and development programs at low costs to ensure that the company has efficient and effective human resources. Next, it is also one of the most essential duties and responsibilities of the human resources team, to ensure that all policies and the handbooks of the company are in place and are correctly updated at all times. The human resources team is also responsible to ensure that the employees are able to read the handbook and the language is simple and straight forward. Recession period also brings about the layoffs with the companies as a mode of cost cutting. Again the human resources teams play a major role in the layoffs in the company and need to ensure that all legal responsibilities are well understood before they can lay – off any individual from the job. Other essential factors that they need to keep in mind are the scheduling of the work schedules for the employees. This is a huge challenge for the human resources team as it involves planning the work days for the employees and also considering the lay off and cost cutting activities, it is becomes even more as difficult as the amount of work load increases leaving the employee unsatisfied and de – motivated. Another very commonly seen change that is found in almost every company is the cutting of the pay. This is one of the other factors that need the human resources teams efforts (Waldo, 2005). This is one of the most difficult changes that the team need to incorporate into the company for the simple reason that the reduction in the salaries will directly affect the working of the people and will also cause a high level of de – motivation and problems related to the overall performance within the company (Pfeffer, 1998). Employee motivation is a very important aspect of management. Every individual has different motives in life. These motives can affect the individual’s behaviour at all times. Thus it is essential for managers to understand the needs of employees to ensure better performance within the organization. Motivation is generally explored on the basis of three main aspects: a) Goals, b) Decisions, and c) Influence. It is up to the Human resources to be able to keep up the motivation of the employees despite the recession and ensure that employees are ready to work with the full interest and dedication to the job. It is essential that despite the chances of excessive work being allocated to the employees the human resources team is able to rightly find innovative solutions to keep up the spirits within the company and the teams (Losey, Neisinger and Ulrich, 2005). To do so the human resources team can keep contests and a number of other games to find the most efficient worker and retain them within the organisation. Also this is a mode of finding the best potential within the company and to help them by development programs and learning processes (Knoop, 2004). As mentioned earlier, the motivation of the employees plays a very important role in the ability of the human resources team to manage the changes within the recession period. Also it is essential that the team understands the needs of the employees and the effect of the needs on performance. Employees normally compare for equity with their colleagues within as well as outside of the organisation. Thus the management can ensure that efforts are made to pay employees a salary that is equal or is in terms with the industry. The salary plays a very important motivating factor for most employees. An employee will be more willing, motivated and ready to take initiatives if the salary is in terms with the pay within the industry for similar skills sets (Mind Tools, 2008). Also, inequalities within teams will cause the employees to feel de – motivated that will reduce the outputs. Hence managers need to take steps to ensure the employees contributions are recognised and that equal treatment is given to all within the team. Also if an employee is found performing below the levels when compared to the team, then the employee should not be given equal treatment as it would be unfair as well as de – motivating for the employees who have worked harder (Fowler, 2006). Thus it has been understood that the human resources team play a very important role in the organisation and that they not only aim at reducing the cost of working and operations but also aim at the growth of the company in the future. This would mean that the decisions made by the HR teams can affect the company in the long run as well. Thus the role of the human resources is a very essential in the overall working of the company. Recession and Impact of the HR on Employees: Recession can make it possible for the employees of the company to be found by head hunters and competitors. It is for the human resources team to ensure that the employees are not easily taken away by the competitors and do not loose interest in working for the company itself. To do so, it is essential that the human resources team are able to create a good differentiation between the good and the average employees. This is to ensure that employees who work hard do not go unnoticed and the work done is reciprocated with good compensations (Kazuo KatoÌ„ 1983). Also, it is essential to have a good flow of employees from within the company, which means that when needs arise in different departments the company can redirect the employees to other departments where the employees could work better or even if the other department is a choice of the employees. This is referred to as job rotation and this is generally very beneficial for the company as it allows better performance by the people. Also one essential thing to be remembered is that during recession times, every individual is affected to a great extent, hence, it is important to understand and listen to the needs of the employees and to ensure that the employees are motivated. To do so, one key secret for all human resources is the need to communicate and understand the needs of the employees. Also in order not to loose the employees of the company, it is essential to provide the employees with a vision for themselves in the long (Dulewicz, 1989). This could mean providing them with a vision of higher pays in future, better positions and also better working conditions and any aspect of the job that would prove to motivate the employees. Hence to do so, it is essential that the human resources team listen to the needs of the employees and the organisation as the whole. These will allow for the teams to be held close together and will also save the company good employees and talent. It is important that the employees are motivated enough and this will let them stay with the company even through times which are trying and difficult and thereby let the company continue to perform well (Dowling and Richardson, 1997). In a survey that has been recently conducted with the invent of recession over the global economy, it has been noted that the cost cutting measures lead the human resources teams to work in different ways. The research was conducted and it showed that the effects of the cost cutting required the human resources to reduce the holiday pays, and also lead to higher downgrading. The companies also need to have higher benefits via communication and reduced temporary workers. Ways to Beat Recession: Recession as has been understood can lead the companies to be faced with a number of issues in regards to the employees especially. Thus there are a few steps that can be undertaken by the companies especially under the supervision of the human resources team and this will help the entire company benefit. The first and most essential step is the need for the top management to have complete knowledge of the contingency plan. This will allow the management to plan and correctly allocate resources to the various processes. Also the top management can provide the human resources teams with excellent strategic planning if the ideas are used via brainstorming or other similar methods. The human resources team could also provide the employee with a chance and allow them to recruit people even during recession. Recession does not only mean lay offs and people loosing their jobs. There are a number of jobs which are available for job profiles even during recessions (Cannell and Wood, 1992). Also as has been discussed, the chances that the company loose people who are essential are very high. To avoid such situations, it is important that the employees’ performance is evaluated and the right compensations are provided to the deserving employees so that the employees are not lost. Also during difficult and trying times, the most essential aspect of the business is to have clear and concise communication. This needs to be from top down and this will help encourage the staff and keep up to the period. This manner of communication will also keep the staff calm and the entire atmosphere calm and balanced. If any issues do arise within the teams, it is important to ensure that the issues are solved within the teams rather than escalating them further higher up the line. One other aspect needs to be clear and well defined is the processes and procedures of the human resources as this will provide the company with direct success. Also in case of the company cutting out on staff it is essential that all possible routes are first checked before taking this decision. This will help keep up the employee moral and will also keep employees motivated. Recession also causes a lot of change to the company and its people (BBC, 2009). It is up to the human resources teams to manage this change and allow the people to have complete confidence in the company they work for. Also the change can be incorporated in a well disciplined manner if the company share the details of the change process with each team and allow a slow change throughout to ease out the effects of recession. Conclusions: It is essential to understand that HR is focused more on the traditional activities than on making a number of strategic plans. The HR however still has a very essential role in every business and the role and functions of the HR teams as discussed above include the activities like reward and benefits, performance evaluations and HR operating efficiencies. They strategic parts of the HR teams also include the leadership development and talent management along side the development of productivity as well (Barber, 1998). In times of recession as has been discussed the main role of the HRM teams is to ensure creativity and a well balanced strategy. In conclusion it is safe to say that the HRM team need to bring about newer ideas and changes to the process and develop the functions and processes in a way to ensure that the company is able to cut out on the expenses and also go on to benefit equally well from the cut downs as well. As discussed it is essential that the strategies developed during these times are strong and well planned as the changes made in the recession times need to be carried on even after the businesses are in full surge and are the economy has moved out of the recession. It is essential to also understand that all monies spent in terms of the HR of a company are very essential for the company and these are not in any manner unnecessary. Thus if an HRM team is able to bring out innovative ideas to improve the amount the company spends on the business then the solutions are very innovative and can help in making the organisation stronger when the environment improves and the recession is set off. In conclusion it is safe to say that the HRM teams already work within strategic planning for the daily processes. It is in the times of recession that these teams are actually put under the spot light and these teams need to be innovative in the basic processes like employee reward, employee relations and training and developments (Bach, 2005). It is in these trying times that the HR teams need to be able to handle the processes with the company’s having to pay lesser (to cope with the recession) and the employees needing to remain motivated to be a part of the company. In short it is a strategic balancing act for the human resources teams specifically during the recession. 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