Human Resource Management Practices Can Help Organizations - Case Study Example

HUMAN RESOURCE MANAGEMENT PRACTICES Name of student Name and Number of Course Name of Professor Date Introduction Human resource management is the act of administering and regulating the organization’s most valued resource. Employees are the means by which an organization determines how they adapt to the external environment. Human Resource Management is tasked with selecting, recruiting, training and evaluation of employee performance. It is the most important aspect of any organization; it is the key to obtaining advantage over other companies. This is mostly because of the ability of the employees to convert other resources in to output. No two companies have the same human resources thus this can bring about competitive advantage. Managing the human resource can be very difficult at times. Effective management requires that a company has good HRM systems, these systems are used in different HRM practices. (Bondarouk T.V, 2008). The HRM practices are the organization’s activities that are geared towards managing the employees. This is mainly aimed at ensuring that the available resources are directed towards the achievement of organization’s objectives. Research studies have come up with different descriptions of HRM practices. Some theories argue that most HRM practices are connected with improved performance of the organization. Employees who carry out their operations in a condusive environment and are well-paid have higher productivity rates. HRM practices have been outlined as follows; first of all HRM should carry out carefully planned and laid out recruitment and selection process. (Alas, 2008). This means that it should select the best from the group. Those selected should have no defects when it comes to working in the organization. HRM should also have good remuneration system, for example benefits and bonuses for staff working overtime. Teamwork and flexible work operations and descriptions are another HRM practice. (Garavan, 2008). This practice ensures that the right job is given to the right man and no one employee works alone. Enhancement of skills through training employees in different departments will improve employee performance, for example marketing staff having interpersonal skills. Employees will feel important when they are involved in the decision making process. Informing them of any key changes in the organization’s structure or operations will also enhance their performance. Lastly is employee motivation through performance appraisal, obtaining feedback from the customers to know how well the employees are performing. (A., 2007). There are a number of factors that affect the HRM practices. These factors are both internal and external because of the variations that exist from region to region. Changes in the economy, has forced HRM to expound their practices to incorporate international relations. Technological knowledge is rapidly increasing; this affects HRM by changing how they carry out their operations. HRM practices have to be formulated in a way so as to adhere to the rules and regulations of the country they are operating in. Competition can adversely affect the operations of an organization; HRM is tasked with developing a wide scope of human resources to be able to have a competitive advantage. Globalization has opened up markets in different countries. As a result companies are moving from their countries of origin to other countries in search of market. This has become a big challenge to the organizations while selecting the right employees. Internal factors include: the size of the organization, small organizations do not carry out all the HRM practices. An organizational structure will determine the flexibility with which HRM carries out its activities. Linking the business strategy with HRM practices will enable an organization gain competitive advantage. (Joseph K. E, 2009) Sustainability Challenge Sustainability can be defined as the influence of the organizations performance on the economic, social and environmental aspects of the community. Every organization seeks to maintain an even distribution of economic success, social responsibility and environmental development. Sustainability poses a challenge to many organizations since it requires a substantial amount of financing which is hard to obtain. (Anand, 2010). To have competitive advantage, an organization needs to carry out a number of activities. These activities include; develop methods that will enhance sustainability in the organization, evaluate the performance in line with sustainability and finally combine the sustainability to its financial ability. Many organizations are becoming sustainable by enhancing social responsibility. They mainly carry out different activities that enables the society manage their everyday challenges. For Example, in Kenya, A Bank Called Equity Bank has over the years given scholarships to poor and marginalized children to further their studies (Mijungu, 2014). In America, we see that Companies are coming together to provide medical insurance to cancer patients who cannot afford the treatment. These are examples of social responsibilities which enable an organization gain competitive advantage. Sustainability should be long-term and worthwhile. This can only be achieved if it is incorporated into the daily activities and performance of the organization. Managers should combine sustainability with the decisions of business operations, evaluating the performance of products both in the future and in the present. (Moldaschl, 2004). HRM is one department in the organization that has a critical role in ensuring that sustainability is achieved. As mentioned above, the major challenge facing organizations in sustainability is finances. Some organizations do not have enough finances to carry out social responsibility or even to influence the economy. This means that sustainability is a challenge to many organizations. For HRM to enable the organization cope with this challenge, it needs to incorporate its practices into the daily activities of the organization. First of all is by ensuring that there is a development, support, evaluation and maintenance of set ethical standards in the organizations operations. This can be achieved by ensuring that new employees entering the firm are well versed with the ethical principles practiced. HRM can also impose punishments on staff that go against it and upraise those who uphold the set standards. This will ensure that the desired ethical standards and practices become a working culture and new employees will adapt efficiently. Managing the human resource effectively is another requirement for HRM to maintain sustainability. Recognizing and maintaining a high level of trust between the employees, the managers and the stakeholder. This will enable the organization focus on the interests of the society and economy and thus manage their finances efficiently. HRM should ensure that employees work efficiently to ensure that the organization gives information about its products, services, and operations at the appropriate time. (Salzmann, 2005). This will enable the organization gain public trust through its transparency. A manager ensures that the organization runs effectively. Being part of the HRM team, a manager should ensure that the firm is involved in fair dealings with their suppliers, customers and partners. This usually has an advantage in that it enables the organization to develop lasting relationships with both the society and other firms. Capital is the most essential resource for a business to run efficiently. This capital is obtained from different sources. A firm should ensure that its capital providers are compensated efficiently and protection of both the current and long-term assets of the firm. HRM should also ensure that the employees work towards respecting and understanding the interests and needs of their customers. This will ensure that there is production of high quality services and products. HRM as the key employment agent of the organization should then ensure management operations that encourage and support personal and expert-wise employee development and empowerment. All of these methods that HRM can do to help the organization cope with sustainability challenge relate to social and economic responsibility. In the long-run, HRM should promote environmental awareness amongst the employees and managers. This is through enhancing communication in between the various departments on how to develop products that will protect and restore the environment. We are able to identify two aspects of HRM in sustainability. The first is that HRM enables employee to develop a positive attitude towards the organization and its responsibility to the society and environment. Secondly it enhances cooperate relationships between the organization, stakeholders and other companies. This it does by enabling the attainment of economic, environmental and social goals of sustainability. (McWilliams , 2006). Global Challenge. Over the years, movement of goods and services across countries and continents has rapidly increased. The development of the free trade zones in North America, Europe and Asia has led to a decrease in the trade barriers that once existed. Globalization has influenced the ability of organizations to effectively compete in international markets. It has brought with it economical factors such as; low labor and production costs in developing countries. Increase in demand of goods and services across countries, reduced international transportation costs. Technological development and increased levels of standards set up by internationally known standards like the ISO 900. (Wagner, 2007) An organization’s human resources should enhance the performance of the organization and improve its ability in the investors’ perspective. International markets usually give an organization a competitive advantage. But this will only occur if the firm acknowledges market differences in different countries and incorporate them into their operations. An organization’s practices may not be accepted in some culture. An example is the Lincoln Electric’s which had difficulty in incorporating its profit-sharing approaches in other states outside the U.S. (Earley, 2006) Economical proponents have shown that effective HRM leads to a positive report in financial performance for international companies. With the increase in globalization there is an increasing demand in effective HRM activities. Many employees working in international companies established in developing countries earn less than those in the developed countries. Many companies are seeking to transport labor because of the low labor costs presented. For example, it has been identified that Computer programmers in underdeveloped countries earn 6 times less than what computer programmers earn in the U.S. (Babcock, 2004). Therefore HRM practices will defer across countries. The challenge mainly concerns; amount of salaries and wages, compensation, benefits and labor unions. Therefore for HRM to enable the Organization overcome these challenges there are a number of activities it should carry out. Each organization has its own goal, the common goal being profit maximization and shareholder wealth maximization. HRM should therefore develop its approaches in accordance to the objectives of the organization. In order to actively carry out this activity, HRM should be informed on the organization’s finances. With this knowledge, HR managers can be actively involved in the decision making processes. HRM can thus know how many employees are needed, which skills should they posses and how much will be their salaries and wages. Constant changes are inevitable in the international market; an example is the rules and regulations of a country. The leaders of a country which is politically unstable can continuously change its regulations to match its economic and social demands. HRM should be able to formulate operations that will assist managers in evaluating and respond to changes in their business environment. The HRM department must also encourage other departmental managers formulate and implement processes that reward behaviors that are in line with the set goals. Developing an effective reward system will help deal with employee refusal to accept change. HRM will enhance organization’s value by helping the shift to new practices that are more competitive in the global market. HRM can also help the organization cope with the global challenge by indentifying existing opportunities. These opportunities can enable the organizational develop a taskforce that is technically knowledgeable and expertise. Organizations can then effectively exploit the opportunity to their advantage. HR managers should also give out efficient operations such as training, compensation and performance management that make use of emerging technologies and trends. As a HR manager it is essential to have knowledge about the sources of different financial activities. The knowledge gained will enable the manager formulate strategies that can lead to reduced cost and still add value. HRM must also enhance employee motivation in different ways. The first is by allowing employees to voice their needs, listening to these needs and reacting to these needs with the available resources. The needs of employees are usually different and vary according to daily matters and also legal issues. HRM should take their time to solve these issues to the levels they see best and ensure that both parties are satisfied with the results. Secondly is by enhancing employee knowledge and skills, enabling them to contribute to the organizations efficiency. Though training and development, mentoring and promotions, an employee will enhance their competency and work towards achieving organizational goals. HRM practices usually differ with cultures of the countries the organizations are situated. Therefore it is important to know the cultures and behaviors of the people in a country the organization is planning to establish its operations. Hofstede carried out research studies in 1980-2001 and came up with a model that contained five cross-cultural dimensions describing the cultures in different countries. These dimensions include; masculinity-feminity, individualism-collectivism, uncertainty-avoidance, power-distance and short term-long-term orientation. (Hofstede, 2001). HRM can use these dimensions to evaluate the characteristics of the people in the country in question. The evaluation will enable HR managers develop strategies that they can use to capture the pool of human resources and adequately train them in line with their cultures. HRM can then advice top management on how to carry out business operations that will give them a competitive advantage in the particular country. Technological challenge Technology in the world is quickly advancing and the organizations need to develop their technology with the changes so as to gain competitive advantage. The organization faces challenges on how to enable the workplace to adapt to that changing technology. Technology has had an adverse influence on the nature of jobs leading to a reduction in jobs that require technical skills. Technology usually creates unemployment leading to less skilled human resource. It also causes challenges on how to carry out non-monetary motivation, for example on-job training, and encouragement. When many companies change their work operations to be automated many people who had hands-on skills are left unemployed. (P.S, 2004) The problem arises when there are no manpower to control these machines, and now the organization faces scarcity in the number of its employees. The role of HRM should be to shift its strategy with the changing technology. This strategy should be one that is capable of being flexible and adapting to the changes in the economy. HRM should be prepared for any technological changes that may arise. They should be ready to support a constant managerial environment in the organization and demand for technological changes to be carried out so that the organization can be at the same level with its competitors. (Othman, 2005). Technological changes in the organization requires that there is addition of technically skilled labor, or technically train the employees who are present. HRM should assess and establish the training that is required by the organization. After this, is when they can arrange for the necessary training processes to take place. These measures will make certain that employees can keep up with the changing technology and uphold the organizations efficiency. Many companies have fallen drastically because they were not able to keep up with the changes in technology that was occurring in the global market. Increased internationalization has made the market to become very complex. Managers have a hard time in maintaining the human resources in the different countries. This is because technology is making it difficult to find competent people who can work efficiently. Strategic HRM usually come in to solve this problem, HRM usually addresses administrative and functional factors that relate to technology. This is done by developing an HRIS, which is a system that is used to collect, analyze, store, manage and present information on human resources. HRIS is essential in making the information operative, enabling the HR managers to acquire and distribute information that is clearly defined according to HRM policies and practices. (Mei, 2008). HRIS usually divides information into different sections. The first contains information about the employees, date of employment, address and even date of birth; this is mainly the administrative function of HRM and should be maintained. The recruitment section has information on the department where the position to be filled is found. The knowledge and skill this position requires and experience of anyone to be hired. Another section is the time and attendance section. It contains information that can be used to determine the date hired, any absences and termination date. The training and development section contains information on employees’ skills and abilities, training attended and those not attended. The organization management section contain the structure of the organization and its job descriptions, it usually gives positions held by employees according to their skills. When the HRM adopts this system, it can easily adapt to and control technological changes that are arising in the organization. This will in turn enable the company maintain its technological advantage or even gain more competitive advantage. (Insight Consulting Partners, 2005). References A., C. M. (2007). The Impact of HRMpractices on organizational performance in the Indian Hotel Industry. Employee Relations, 576-594. Alas, R. K. (2008). Human Resource Mangement in Cultural Context. EBS Review, 49-63. Anand, S. S. (2010). Human Development and Economic Sustainability. 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