Concept of Human Resource Management and Innovation - Coursework Example

HRM and Innovation Name Course Lecturer Date This essay examines and analyses the concept of Human Resource Management (HRM) and innovation. Various lessons from the world’s most innovative firms are used in support of the study. The HRM practices have had several aspects in definition. They involve systems that are concerned with the attraction, development, motivating and retaining employees in such a manner that ensures that the organisation and the members have effective implementation and survival. The human capital is the focus in HRM practices in meeting the objectives of the business through internally consistent practices and policies. The sustenance of the competitive advantage is linked to the ability of the organisation to harness the human resources to have a developed level of competence. The organisation innovation is primarily concerned with the creation of new behaviour and new ideas that benefits the organisation. The designing, development and execution of innovation arises the need for significant transformation. The achievement of this is hereby linked to HRM. The HRM is revealed as taking innovation into the core of the organisation design. Every person is mandated to be involved in the innovation activity. The place to start is that of breaking down of the present barriers and mind-sets that forms barriers towards the establishment of a favourable framework for innovation within an organisation. HRM must therefore develop a deliberate design for knowledge and experiences, leadership development and skills definition. This helps HRM to become central in capitalising, mobilising and cultivating innovation. The executives, founders or individual employees may give rise to innovation at its various categories whether directly or indirectly. (Zoghi, Mohr and Meyer 2010, p. 627) The stimulation of innovation as linked to the HRM practices emanates from multiple mechanisms. These include employee communication networks; motivational mechanisms like rewards; Organisational practices like upgrading, deployment and sourcing of human capital; and the managerial styles. The HRM practices, however, are most relevant to the performance of innovation when they are integrated as a system of mutually reinforcing practices. This is a strategic move in allowing the organisation to appropriately respond to the competitive business environment. This is especially needed now in the face of the rapid development in communication, information and other technologies that call for new solutions, ideas and experimentation that address the particular needs of the involved groups in the most efficient way (Zhou, Dekker and Kleinknecht 2011, p.951). The organisation innovation relates to the HRM practices in platforms of best practice in various categories recruitment, training, reward system, career management and performance appraisal. There are multiple and dynamic dimensions that relates to innovation in an organisation. The depth of innovation relates to factors like the effect on long term profitability, the degree of influence and the importance. The breadth of innovation relates to factors like services, products, processes, administrative, systems and policies. Administrative innovation and technological innovation are the two fundamental distinctive types that the organisation innovation has been categorised into. The technological innovation relates to process innovation and product innovation. New products are developed and commercialised in the creation of value and meeting of the needs of the market or the external user through product innovation. It involves a work process that is systematic in production of new prototypes, devices, products and materials. The improvement of new processes or creation of new ones is achieved through process innovation. The administrative innovation concerns itself with the management issues related to basic work activities that are in the organisation, reward and information system, and the organisation structure changes and administrative processes. (Truss, Mankin & Kelliher 2012) The building of customer relationship through empowerment and participation, enhancing the culture of an organisation and encouragement of team responsibilities is encouraged through the adoption of HRM practices as the strategy of the organisation by the innovative firms. New services and products that attract a very high market share will result. Employees who are creative and innovative are required by the firm in the development and introduction of new administrative practices, new process and new products. These kinds of employees are able to be tolerant to ambiguity and uncertainty, take risk and be flexible. HRM practices that are inclined towards stimulation and motivation of employees unto innovation should, therefore, be implemented and supported by any firm that is to realise sustainable success. The manufacturing industries, for example, should highly bank on these employees due to the contribution they make to the firm on the basis of process and product innovation, and market responsiveness. (Foss, Laursen and Pedersen 2011, p987) The companies that have expressed sustainable levels of success in the marketplace have had to integrate creativity and innovation in the creation of competitive advantage. This is a process which fundamentally integrates effective management of HRM (Schuler 2013, p124). The various systems that can be focused on in this creativity and innovation include; career management; reward systems; performance appraisal; and human resource planning. The strategy of career management relates to the long term carer goals of the employee as matched to those of the organisation. This demands a progressive training and education. The strategy of the reward system focuses on motivation of the personnel in the achievement of the goals of the organisation that relates to profitability, innovation and productivity. The association between the profitability of an organisation and the innovativeness of an individual is achieved through appraisal of the performance of the team and the individuals by making use of the performance appraisal strategy. The strategy of human resource planning involves analysis and determination of the needs of the personnel for the creation of teams that are effectively innovative. Considering the issue of human resource planning, the Motorola Company has a developed system in the identification of new product ventures. There are organised teams of five to six employees from various departments particularly finance, engineering, manufacturing, sales, marketing and R&D. Every member in the venture team is required to exhibit an eagerness for new experiences, tolerance to ambiguity and openness to new ideas. The Company also has teams that are interdepartmental in new products development. This ensures that the new products that are developed have the capability of attracting huge profits, meet the criteria of customer satisfaction and be cost-effective in the manufacturing. This approach of venturing teams is also adopted by the 3M Company in the development of new products. Various disciplines and skills are integrated in the championing of any idea of launching a new product. A team with a balanced personalities and skills is also needed by the Apple Computer in the efforts to have discipline in the development of a new product without stifling creativity. (Jackson & Debroux 2013) Effective human resource calls for effective rewarding and appraisal of the performance of the personnel. The professional tasks, however, are diverse and different in nature which pause a great challenge to the organisation effort to appraise the professional performance. A significant time lag between obtaining of dependable results and the research initiation exists particularly in the companies that are technologically based. Various measures of the creativity and innovation have been in use. They include research grants, project completions, presentations, reports, publications and number of patents. The evaluation of employees in an innovative company is, however, a complicated process. This is because innovation involves a multidisciplinary, uncertain and a very lengthy process. The efforts of the individuals as well as those of the teams are highly demanded. The Rubbermaid Company develops an appraisal that is adjusted to remove bias relating to being overly conservative. This means that a room for mistakes is granted to innovation process without the fear of being challenged in performance. The Raychem Company sets its system of evaluation as not merely rewarding the success attained but rather focusing more on the intelligent effort. A unit-by-unit technical audit of the innovation process is conducted by some companies like the 3M in their appraisal endeavours. (Stahl, Björkman & Morris 2012)  In the achievement of profitability, productivity and innovation goals, various reward systems have been developed by organisations. A rewarding system that is very effective in the motivation of employees to have generation of more new product ideas, development of successful new products and taking of risks is needed in the organisations that have innovation as their driving force. Promotions, financial rewards, providing freedom for creativity and other recognitions are the practices to be included in the employee reward system (Ceylan 2013, p217). To enhance autonomy, the Hewlett-Packard encourages its scientists to spend 10% of their time on their own research projects. Various pay policies for non-performers and performers have been adopted by Merck. The performers have non-monetary and monetary rewards in addition to the basic pay. These rewards are not position oriented but they are performance oriented. (Hoque 2013) There are companies that operate a dual track career system whereby the professional employees are allowed to have a different scientific track while the administrative and the management employees have a managerial track to move up. The HP has had this system where the influence, status, pay and proportions are matched. The employee and the company stand to gain in the establishment of a dual career system. The challenges that come with both of the tracks when handled properly help in the creation of well-rounded employees. This system helps in the minimisation of possibility of friction between the managers and the scientists. The professional careers of each group are allowed to thrive. (Brencic, Pfajfar & Raškovic 2012, p442) The innovative companies like HP have schemes of empowering their employees by employing the strategy of management of the careers of the employees in the providence of chance to face bigger challenges, obtain varied experiences and tackle new problems. The new knowledge that the top leadership implements and propagates serves as an example for other employees who progressively receive training and education in various skills (Jiang, Wang & Zhao 2012, p4031). Google has had a tremendous market success. It has incorporated in its system a people management system in its innovation. The Company has efforts that are directed toward making accurate people management decisions that are linked to resource allocation, marketing, R&D, product and the like. This is especially emphasised in the light of the knowledge that the employees are a major contributor to the corporate variable costs. Google uses a data and an analytically based model in the HR function. (Sullivan 2014) For the organisations to achieve sustainable success they need to give their attention to the HRM issues and innovation (Ennen and Richter 2010, p213). Objective benchmarking of the best practices as indicated by some of the world’s most innovative firms need to be done. The adoption of best practices in factors like career management, reward systems, performance appraisal and human resource planning should always be the focus of the innovative organisation that seek to have a successful HRM. An active HRM effort is required in specific areas such as having new ways of communication with and between employees, new rewards, new performance indicators and dedicated training. The link that exists between HRM and innovation need to be clearly known and integrated into proper use. In addition, the research stream that links to the HRM and innovation must be at the core of the organisations that seek to be at a high rank in the performance rank. It is to be noted that the trends in the HRM and innovation may keep on changing due to the dynamic atmosphere that the organisations face. However, these factors importance will always be at the core of the success of an organisation. This paper has considered examination and analysis of the concept of Human Resource Management (HRM) and innovation. Various lessons from the world’s most innovative firms are used in support of the study. These firms include Google and HP. The high level of dependence that any organisation has in relation to HR and innovation issues has been discussed. The organisations that have expressed sustainable levels of success in the marketplace have had to integrate creativity and innovation in the creation of competitive advantage. This is a process which fundamentally integrates effective management of HRM. Various recommendations like benchmarking of those innovative firms that have exhibited great HRM practices have been given. References Brencic, M M, Pfajfar, G, & Raškovic, M 2012 Managing in a time of crisis: marketing, HRM and innovation Journal of Business & Industrial Marketing,276, 436-446. Ceylan, C 2013 Commitment-based HR practices, different types of innovation activities and firm innovation performance The International Journal of Human Resource Management, 241, 208-226. Ennen, E, and Richter, A 2010 The Whole Is More Than the Sum of Its Parts: Or Is It? A Review of the Empirical Literature on Complementarities in Organization Journal of Management, 361: 207-233. Foss, N J, Laursen, K, and Pedersen, T 2011 Linking Customer Interaction and Innovation: The Mediating Role of New Organizational Practices Organization Science, 224: 980–999. Hoque, K 2013 Human resource management in the hotel industry: Strategy, innovation and performance Routledge. Jackson, K, & Debroux, P Eds 2013 Innovation in Japan: Emerging Patterns, Enduring Myths Routledge. Jiang, J, Wang, S, & Zhao, S 2012 Does HRM facilitate employee creativity and organizational innovation? A study of Chinese firms The International Journal of Human Resource Management, 2319, 4025-4047. Schuler, R S 2013 Opportunities abound in HRM and innovation Journal of Chinese Human Resource Management, 42, 121-127. Stahl, G K, Björkman, I, & Morris, S Eds 2012 Handbook of research in international human resource management Edward Elgar Publishing. Sullivan, J 2014 How Google became the# 3 most valuable firm by using people analytics to reinvent HR. Truss, C, Mankin, D, & Kelliher, C 2012 Strategic human resource management Oxford University Press. Zhou, H, Dekker, R, and Kleinknecht, A 2011 Flexible labor and innovation performance: evidence from longitudinal firm-level data Industrial and Corporate Change, 203: 941-968. Zoghi, C, Mohr, R, and Meyer, P 2010 Workplace organization and innovation Canadian, Journal of Economics-Revue Canadienne De Economique, 432: 622-639. Read More