Strategic Positioning of HRM in the Knowledge Based Economy - Coursework Example

Strategic Positioning of HRM in the Knowledge Based Economy Introduction People constitute an organization’s most important and vital factor in its success or failure. Unlike material and financial assets, human resources, by their nature, are highly dynamic and elusive, defying foolproof quantitative analysis and predictability. The challenge of management is not so much in its money, machines, methods, or markets, but in its people. Various models showing the place of human resources in an organization have been drawn up by academicians and practitioners in this field of endeavor. These models reflect their concepts of and attitudes toward human beings in the work setting for all kinds of organization. In this regard, this essay aims to proffer strategic positioning of human resources management (HRM) in the knowledge based economy. The topic would investigate the strategic linkage and interface between strategic HRM and knowledge management. An exploration of how HRM facilitates knowledge sharing in the so called learning organizations would likewise be determined. Terms Distinguished Human resources management as a field of endeavor involved in recruiting, motivating, maintaining, and focusing on the personal and professional development of people in terms of honing specific skills, knowledge, competencies, needs and preferences in concurrence with the attainment of personal, organizational and societal objectives (Martires, 2004, 6). Human resources management deals only with people so that they can manage the other resources within their domain of responsibilities efficiently and effectively. Corporate strategy, on the other hand, is a clear and concise structural guide for decision making taking into account the mission, vision and values of the company and uses these to direct the course of the firm’s day to day activities (Mitzberg, Quinn & Goshal, 1999, 51). An organization’s corporate strategy encompasses management’s comprehensive and holistic approach towards the attainment of well defined goals (Glueck, 1980, 9; Mitzberg, 1999, 13). Accordingly, strategies serve as a guide for organizations to detail how goals are to be achieved with the use of various resources of the company. For a corporate strategy to be classified as strategic, especially in the aspect of human resources management, Boxall & Purcell (2003) averred that the company’s personnel, as the most important resource of the organization, is identified to design and implement measures to successfully compete within the industry after evaluating both the internal and external environment. The link between strategy and human resources management focuses on the impact of personnel towards achievement of organizational goals. HRM facilitates knowledge sharing in the so called learning organizations. The concept of learning organizations (LO) is instrumental in furthering studies on knowledge management. Aggestam (2006, 296) averred that, “the concept of LO regards the organization as an entity and focuses what are the characteristics such that encourages its members may learn”. In addition, “LO tends to focus more on external threats as the reason for fostering learning” (Kezar, 2005). The LO concept is linked to knowledge management (KM) through the use of information or data by human resources for the greater benefit of various stakeholders. In this regard, KM is known as the planning, organizing, directing and controlling of information through human resources, systems, procedures and technology to specifically benefit those who are directly involved in the process (Thite, 2004, 28). “The process in which organizations assess the data and information that exist within them, and is a response to the concern that people must be able to translate their learning into usable knowledge” is another view for KM (Kezar, 2005, 150). Both definitions emphasized that the common element for KM are the presence of data and the skills utilized by human resources to manage these data for various purposes: personal, professional, organizational and even societal goals. The distinguishing traits of relevant terms would assist to determine the interrelationship between HRM and KM – specifically the role that HRM takes in facilitating the sharing of knowledge in learning organizations. The Role of HRM in KM The role of HRM in KM has several significant rationales, to wit: (1) to articulate the objective of KM in the organization, (2) to facilitate knowledge through goal alignment and incorporation of culture in policies and procedures; (3) to enable personnel to learn and synthesize information to a holistic learning experience through skills and competencies; (4) to actively share the practical application of knowledge in everyday lives; (5) to encourage previously identified unconventional behaviors and relax controls in human organizational interactions; (6) to evaluate and apply strategic measures in developments on technological and communication systems in the organizations by ensuring that balancing factors on traditional modes of communication are retained; and (7) to continually support “low-tech solutions to knowledge management” (Lengnick-Hall & Lengnick-Hall, 2002, 231) through an encouragement of simple and traditional methods of teamwork and collaboration. These roles augment the conventional functions that HRM undertakes: acquisition, training, development and career planning of human resources in the organization. With KM, HRM focuses on the role as knowledge facilitators through innovating various management theories from traditional models to contemporary approaches. The critical element that is taken into consideration by HRM in KM is the ability of a leader to facilitate the use of knowledge into an application which benefits various stakeholders (Lengnick-Hall & Lengnick-Hall, 2002). The talent of a KM leader focuses on integrating the critical elements of the organization. The leader links goals through strategies directed to involve people to participate in their accomplishment. As emphasized by Aggestam (2006, 296), the aim of KM is to “create value for the organization”. The identified roles of HRM as knowledge facilitator enhance participation, teambuilding, and collaboration by creating an environment conducive to the sharing of knowledge. HRM acknowledges diversity in culture and sees this as an opportunity to create an environment of continuous learning. As averred by Blodgood & Salisbury (2001, 45) and Pedler, Boydell & Burgoyne (1989, 89), “the environment promotes a culture of learning, a community of learners, and it ensures that individual learning enriches and enhances the organization as a whole”. HR Strategies in KM The strategies used by HRM in directing KM in the appropriate course is clearly explained by Thite (2004). He proffered the following: (1) ensuring trustworthy policies enforced and implemented by HRM; (2) “HR professionals have to help create a nurturing culture and structure that facilitate self, team and organizational learning on a continuous basis” (Thite, 2004); (3) creation of HR systems which are knowledge oriented; (4) policies on recruitment and maintenance of human resources must cater to KM concepts; (5) setting a performance management system to incorporate fair measurement of output versus goals; (6) ensuring an effective reward system supports KM in the workforce; and (7) incorporating cultural dimensions in the organization. The first step in linking strategic HRM with KM is transparency. Records in human resources management are open for scrutiny and evaluation to adhere to policies of trustworthiness and reliability. As emphasized by Thite (2004), “trust and fairness are at the very heart of KM as without them, there is no sharing of tacit knowledge”. The importance of transparency and telling the truth should be manifested by leaders in the organization. Leaders with integrity should have the courage to tell the truth about what is right and wrong in the organization, as a means to correct the wrongdoings. With initiative, each and every personnel should be determined to initiate and follow-through the process of positive transformation of the organization’s awareness to the drastic need to address weaknesses like the organization’s active stance in saving and protecting our environment, among others. An environment of trust is consistently emphasized through ethics which finds its meaning in man’s inquiry on moral behavior seeking to find rules and principles that humans must adhere to ensure systematic order and universal good to prevail. More so, the basic theoretical foundations of truth telling and transparency are grounded on ethical principles and moral codes of conduct that must ultimately apply to each and every individual, group, organization and government of this world. The second step is the strategy of incorporating cultural diversity in the organization has been recognized due to the prevalence of global operations. At HSBC, for example, the policy of diversity is being actively implemented to enhance KM. Their official website reveals that “HSBC is committed to attracting and selecting only the best-qualified candidates while valuing a diverse workforce. We are committed to creating a workplace that nurtures individual growth regardless of age, citizenship, color, creed, disability, marital status, national origin, race, religion, sex, sexual orientation, or veteran status. To keep our valuable people, we provide an attractive array of employee benefits and services.” (HSBC: Diversity, 2010, 1) This policy ensures that people from diverse cultures with different backgrounds, educational capabilities and skills are honed to prepare them for new markets and various clienteles in the global market. The third step is the creation of HR systems which are knowledge oriented. In this regard, the policies, systems, communication and technological capabilities installed and implemented by SHRM should be compatible with KM in terms of accessibility and practicability. Each critical element in the organization’s HR system should be adapted to the demands of the times. The fourth step, HR functions on recruitment, placement, development and maintenance of personnel must incorporate the KM model, incorporating culture, leadership skills and style, vision, an integrated work process and organizational learning, among others. Fifth, performance evaluation is the appraisal of the accomplishment of the employees of an organization. The determination of organizational effectiveness which is the degree to which objectives of an organization of an organization are achieved is a cardinal task of management. The contribution of each employee in attaining these objectives is the extent to which he has achieved. Therefore, performance management system sets the assessment of the achievement of objectives. The sixth step, in the expectancy model, the linkage between performance and reward is indicated. Reward that is contingent on performance begets more and better achievement if applied with contemporary theories of KM. The need for recognition, participative action towards the accomplishment of the organization’s vision, and new compensation schemes must be taken into account towards the development of a learning organization. Finally, in the seventh step, knowledge of cross-cultural and interpersonal communication is likewise a critical factor in ensuring a competent pool of human resources to encompass diverse cultural backgrounds of virtual teams. A knowledge of diverse cultures would incorporate and address issues concerning organizational culture and diversity – consistent with encouraging sharing information under KM. The strategy that HRM must focus on is to encourage their personnel from diverse cultures to share respective competencies and expertise in their fields of endeavor. Hofstede actually distinguishes national culture by defining it as ‘the collective programming of the mind which distinguishes the members of one group or category of people from another” (Hofstede, 1991, 5). The concept of culture encompassing a particular nation or country became the basis for his research on the dimensions of culture. The impact of culture on leadership and on the people being managed is tremendous. This concept has been acknowledged by the leaders themselves who operate with due consideration for the values, needs, aspirations, beliefs of their work force and even of their clientele. Effective management is measured in terms of how successful organizational goals were achieved through the utilization of the most cost efficient mix of the company’s resources. The manager’s task is to apply management concepts and theories on production, motivation, group behavior, leadership and power, culture, conflict and change, among others. All of these affect people – those who are actually employed in the organization and those who they interact with from their external environment (the consumers, local and state organizations, the community and global markets). The influence of culture on HRM strategies is critical and relevant in terms of making host organizations aware and adept in applying strategic measures towards the achievement of organizational goals. Organizations cannot merely exist and survive by imposing its national and corporate culture to foreign markets. There is a need to closely examine, not only theoretical frameworks on cultural dimensions affecting international organizations, but more so, the practical applications of actual experiences of these organizations delving into foreign lands. Their rich sharing of knowledge and information make the inclusion of culture a necessity for HRM strategy towards KM. Conclusion The evolution of business organizations have transcended barriers due to the rapid technological advancement that occurred within the last century. The classifications and categories of enterprises continue to increase due to factors encompassing developments in time, space and culture. Concurrent with the expansion of organizations in global markets, the strategies employed by HRM become more intricate to encompass theories and applications of knowledge management. HRM must be aware that the nature of the business relationship with diverse stakeholders is of primary importance to manage factors influencing its performance. One of the elements that HRM closely and continuously evaluate is culture. As the components and diverse perspectives of culture pervade global organizations, HRM strategies incorporate culture and other contemporary developments in HRM functions of recruitment, maintenance, performance management, and reward system, in its strategic positioning in the knowledge based economy. The effectiveness of these strategies can be measured in terms of how successful HRM used KM in contributing to the achievement, not only of organizational goals, but also of the personal and professional goals of its personnel. Reference List Aggestam, L 2006, “Learning Organization or Knowledge Management – Which Came First, The Chicken or the Egg?” Information, Technology and Control, Volume 35, No. 3A. Blodgood, JM & Salisbury, WD 2001, Understanding the influence of organizational change strategies on information technology and knowledge management strategies, Decision Support Systems, Number 31, pages 55 – 69. Boxall, P and Purcell, J 2003, Strategy and human resource management. Basingstoke: Palgrave Macmillan. Hofstede, G 1991. Cultures and Organizations: Software of the Mind. New York: McGraw Hill. Kezar, A 1995, What Campuses Need to Know About Organizational Learning and the Learning Organization, New Directions for Higher Education, No. 131, pp. 7 – 22. Lengnick-Hall, M & Lengnick-Hall, C 2002, Human Resource Management in the Knowledge Economy: New Challenges, New Roles, New Capabilities. San Francisco: Berrett-Koehler. Martires, CR 2004, Human Resources Management: Principles and Practices, National Bookstore, Philippines. Mitzberg, H, Quinn, JB, & Goshal, S 1999, “The Strategy Process: Revised European Edition”, reprinted in Talavera, GV, Business Policy: Book of Readings in Business Administration 190. Pedler, M, Boydell, T & Burgoyne, P 1989, Towards the learning company, Management Education and Development, Vol. 20, No. 1, 1 – 8. Thite, M 2004, Strategic positioning of HRM in the knowledge-based organisations. The Learning Organisation, 11(1): 28-44. Read More