Factors Influencing the HRM Decisions of Google in 2013 - Essay Example

 Factors Influencing the HRM Decisions of Google in 2013 Introduction: Human resource management process in the contemporary scenario not only includes people management, but also contributes towards the strategic planning process of a company. Bjorkman and Stahl (2010) observed that, the changes in the role of human resource management is mainly based on the changes in the organisational structure and needs of the business houses to fulfil the market demands. This paper focuses on analysing the human resource planning and implementation in Google Plc. Google is the largest market share holder in the internet search engine industry and Smart phone OS industry. They have successfully diversified their operations for enhancing the scope of future growth, but have also managed to align their operational activities with the HR planning process. Role of HR in Google: Google has a diversified range of products and service base for their consumers. The growth of Google in the international market place has reflected its corporate success in every functional aspect of business management process. The human resource management process of Google does not follow the structured human resource management process, but have customised their human resource management process according to the core values of the firm (Google, 2014). Wright et al. (2001) stated that the employee management process of a firm defines its ability to synchronise the resource utilisation process and generate successful outcomes. In Google, the human resource management is called the people analytics (Doty, 2008). The term people analytics signifies the data based decision making approach followed by Google in order to decide upon its organisational planning. The HR decisions are mostly based on the information gathered from the constant monitoring tools such as, CCTV cameras, work performance measurement systems, etc. In order to analyse the human resource activities of Google, it is necessary to understand the work process and the vision of the firm. The vision of Google has always been to develop ways for sharing information across the globe. Since the beginning of the company in the year 1998, Google has developed products such as the Google search engine, Google Chrome, gmail, etc in order to create a platform for information sharing (Kozlowski, 2012). Based on this vision, the organisational culture is directed by innovation among its employees to create original ideas that will device a path for their consumers to connect with the world. According to Kozlowski (2012), Google visualises its HR process as a strategic partner that helps them align the organisational objectives with the personal interests of the employees. They consider their employees as the most valuable customers that allow them to identify the customer expectations and perceptions about Google and hence, meet the market challenges. Focusing on the organisational structure of Google, it can be seen that, the HR department has been kept as a separate functional unit that is not influenced by the Board of Directors or other top managerial authorities of the firm. The HR practices of Google can be reflected with the help of the following model: Figure 1: Aspects of Google’s HR process (Source: Banfield and Kay, 2012, p - 321) Based on the above diagram it can be observed that, the additional aspects in the people analytics include information gathering, analytics, social good and culture orientation. Banfield and Kay (2012) mentioned that, when an individual is able to connect with the work culture and design, the employee effort in context of self-improvement and contribution towards productivity enhances. The role of the human resource department of Google can be evaluated from the above model. Firstly, monitoring the employee work process allows Google to identify the strengths and weaknesses of the work culture and the employees. The information collected are used to develop future HR designs for accelerating the work process and reduce the wastage of material, time and money (Powell, 2007). The analytics is the most important part of the HR cycle of Google, it assesses the decisions that need to be taken by the management of the company and develop a clear passage for chasing the organisational aims. The decision making process, training modules, recruitment and selection steps are also based on results of the analytics step (Ingham, 2012). Culture orientation helps the employees to adjust to the work culture of Google, and ensures that the employees have job satisfaction. Social good is a mandatory aspect of the Google work culture. According to Huselid (2008), helping the employees manage their personal life with their professional life and building them a social status ensures employee loyalty. Finally, the compensation structure of the HR cycle can be segmented into two parts namely basic payments and fringe benefits. From the HR cycle of Google it can be seen that, people analytics not only helps in the operational functions of the company, but also has significant contributions towards the strategic planning process. Factors influencing the HRM decisions of Google in 2013: In the contemporary scenario, human resource management process has become more challenging with the growth of competition. As firms are trying to develop talent banks, the hunt for talented employees has taken a new shape. The most difficult aspect of HR in the current scenario is the employee retention process. In case of Google, their main problem will be to hold on to their talented employees as other big competitors such as Facebook or Microsoft are trying to accumulate productive human resource for themselves (Banfield and Kay, 2012). Google’s compensatory structure is lower in comparison to its competitors which is the primary gap in their human resource management. However, Google has focused on creating their advantage with the help of fringe benefits such as providing IPO of the company, a participative and motivating work culture, social recognition, etc. Garavan et al. (2008) argued that, employees are more attracted towards the benefits that can be utilised or felt instantly rather than long-term benefits which is more beneficial. In the year 2013, Google has been ranked as the fourth company in the world in terms of employee turnover (Giang, 2013). Apart from these problems, the external factors effecting the human resource decisions of Google can be analysed with the help of a PESTLE analysis: Political: The political influence of HRM mainly relates to the culture of the organisation. The culture of Google is supportive, the HRM functions of Google has been separated by the company in order to reduce managerial influence on the HR participations (Powell, 2007). This also can hamper the work process of other departments, and create internal conflicts within the firm. The perception of the shareholders regarding the employee management process also influences the decision making process of the company. Economic: Google’s HRM department is one of the largest funded bodies in the organisation. The revenue generated by the HRM department of the company also influences the decision making process in the HRM (Hope Hailey Farndale and Truss, 2005). Another essential economic factor in case of Google is the compensation being provided by the competitor firms to the employees that is, increasing the employee turnover rate of the company. Social: The most influential social factor is the change in the demographic nature of the employees. Most of the companies are trying to hire fresh hands for enhanced productivity and the value of experience is going down. Similarly, Google recruited almost 19000 employees in the year which brought in major changes in their work culture and also has increased the focus on the employee retention process. Technological: The technological changes happening in the industry has reinforced the HRM practices all over the world. With the help of virtual integration of the departments of a firm, HRM can now monitor and evaluate the performance and productivity of all the functional aspects simultaneously (Powell, 2007). Google has involved technological growth by creating a common cloud database for managing the organisational information. This database is shared with the HR department, in order to develop better HRIS for organisational growth and development. Legal: The legal requirements in the HR working process mainly depend on the trade unions, regulatory bodies and the organisational HR policies of a company (Bjorkman and Stahl, 2010). Google has developed their work process within the code of practices given in regulatory laws such as employee health and safety act, discrimination act, etc. These practices ensure that the employees and the organisation have a mutual platform for highlighting the needs and problems faced in the work process. Environmental: The environmental factor includes the culture embedded into the workforce of firm in regards to their responsibilities towards the society and the nation. The managerial decision making process of Google allows the employees to communicate with each other and respect their colleagues (Bjorkman and Stahl, 2010). Moreover, they also ensure that the employees are contributing towards shaping a better society for nurturing the future. Arguments for and against investments in Human Resource initiatives: The human resource activities of a firm mainly designed to assess the contribution of the employees in the organisational growth. In the contemporary scenario, the assessment of the business efficacy also includes the role played by the HR department (Powell, 2007). Industry leaders such as Google and Apple have showed that, caring for the employees of a firm and designing a participative work culture helps in enhancing the contribution of the workforce. On the other hand, Kozlowski (2012) criticised that, excessive funding or focus towards employee concerns can derail the work process from the strategic plans of a firm. Doty (2008) mentioned that, investing in the human resource activities needs to be balanced based on the employee demands and the organisational requirements. Google’s HR management process includes large amount of investment based on their fringe benefits provided to the employees. Aspects such as, 20% off time for personal work, gym, five months of paid maternity leave, free food and transportation to office are some of the exclusive features of the Google work culture (Bloomberg View, 2013). These features also results in a huge amount of investment in the human resource process. However, in the above analysis it has been observed that inspite of all these extra benefits; Google is not able to reduce their employee turnover rate. Doty (2008) emphasised that, the business process of Google highly relies on their ability to design extraordinary HR concepts for attracting and retaining their employees. However, the long-term benefits provided by the company are not helping them in enhancing the internal management efficacy. For instance, the IPO offerings of the company offer a larger benefit to the employees in comparison to monetary incentives or higher remuneration, but the employees are moving in the opposite direction. Kozlowski (2012) reflected that, lack of loyalty from the employees also suggest conflicts in the internal management policies of the company. Apart from this, the investment in the HR functions of Google should be redirected towards the recruitment and selection process in order to assess the potential needs and expectations of an employee and also develop a greater chance of employee retention. Most of the time the growth of the employee base of a firm also leads to a chaotic situation within the organisation, and hence participative decision making can also result in late actions on the part of the employers. Ingham (2012) stated that, authoritative decision making reduces the scope of employee participation, but it also enhances efficiency in gaining employee acceptance and accelerates the decision making process of a company. This is another sector where Google can improvise by developing a restricted database for decision making process of the firm. Overall, it can be observed that, although HR investments do not generate direct revenue for the company, but it curves the way for a sustainable revenue generation with mutual contribution from employee and employer. Conclusion: The study reflected the growth in the HRM roles and responsibilities in the business sector over the years. Google as a brand has a reputation for their participative work culture and structure, the freedom of work provided to their employee base enhances the job satisfaction among the employees. They have a low compensatory structure but, Google manages that with the help of extra-ordinary facilities being provided to the employees. However, Google is also facing problems with their employee retention process despite of having all the features of their HR process. Observing the conditions of the corporate industry, it can be noticed that, HRM has evolved and in order to match the advanced organisational requirements, a company has to align the HRM planning process with their culture and strategic operations. Reference List: Banfield, P. and Kay, R. 2012. Introduction to Human Resource Management, 2nd ed. Oxford: Oxford University Press Bjorkman, I.,and Stahl, G. 2010. Handbook of Research in International Human Resource Management. 6th ed. Oxford: Blackwell Publishing. Bloomberg View 2013. Why are Google Employee So Disloyal? [online] Available at < http://www.bloombergview.com/articles/2013-07-29/why-are-google-employees-so-disloyal-> [Accessed 29th October 2014]. Doty, D.H., 2008. Modes of Theorizing in Strategic Human Resource Management: Tests of Universalistic, Contingency, and Configurational Performance Predictions,’ Academy of Management Journal, 39, 4, pp.802– 835. Garavan, T. N., Morley, M., Gunnigle, P. and Collins, E. ,2008. Human capital accumulation: The role of human resource development, Journal of European Industrial Training, 25: 4868 Giang, V., 2013. A new report ranks America’s Biggest companies based on how quickly employee jump ship.[online] Available at < http://www.businessinsider.in/A-New-Report-Ranks-Americas-Biggest-Companies-Based-On-How-Quickly-Employees-Jump-Ship/articleshow/21354951.cms> [Accessed 29th October 2014]. Google 2014. People Operations: be the champion of Google’s Culture. [online] Available at < http://www.google.com/about/careers/teams/people-operations/> [Accessed 29th October 2014]. Hope Hailey, V., Farndale, E., and Truss, C., 2005. The HR department’s role in organizational performance. 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