Hyper-Competition, Roles and Responsibilities of HR - Essay Example

Assess the extent to which HR practices can effectively modify organisational culture and thereby increase the commitment of employees IntroductionHyper-competition is the trend in organizations today and to face it organizations need to have an outstanding Human Resource Management. It is beyond any doubt that human factor, if managed efficiently, is perhaps the most beneficial input for the success on an organization. And managing the human factor as a competitive tool is the responsibility of human resource management (Khatri, 1999). But what is HR management William R. Tracey, in The Human Resources Glossary defines Human Resources as: "The people that staff and operate an organization as contrasted with the financial and material resources of an organization. The organizational function that deals with the people ..." (Heathfield, 2007). The purpose of this paper is to describe the extent to which HR practices can effectively modify organisational culture and thereby increase the commitment of employees, and also give an account on various aspects of HR management. HR applies to the workforce managed by any employer. An organisation or a business needs employees. In other words, without employees it becomes highly difficult for an organisation to run. It is also equally important to properly manage these employees in order to achieve optimal efficiency. Roles and responsibilities of HR There are several research conducted over the years of how to manage the workforce properly. If fact it has been proven to be much more difficult the workforce than maintaining the complicated computer systems or many other machines. It has also been proven beyond doubt that a mechanical approach towards workforce has often failed. This is the reason why the application of human resources management focuses mainly on the most sensitive issue of human analysis to find out what really works with employees. One of the major aspects of HR maintenance involves employee recruitment, training and development as a function of human capital management. Human Resource Management has an important role in making sure that employees' abilities are precisely and favourably nurtured to best suite the companies' requirement. Once the training of an employee is completed, it is essential to seeing a worthwhile return on investment come from their contribution to the company. Along with employee training, HR departments also look into the area of recruiting new applicants. The HR departments are in a continuous quest to find the best talent available on the global labour. Human resources departments also look into a variety of other problems faced by the organisations such as labour relations that include the crucial and highly sensitive dialogue between employees and management - the production of job descriptions, the monitoring of worker to worker relation and to design a efficient employee management system, and over an above the compilation of incentive and benefits packages as well as a variety of other vital functions that relate directly to the employee workforce (hrVillage.com, 2000). In any organisation, the Human Resources Management (HRM) function remains same and it includes a variety of activities. The most important among the functions is deciding on how many staffs need to be recruited and how to allocate the work to the staff. Besides, recruiting and training the employees, ensuring to bring out the best in each of them, dealing with performance issues, and ensuring standards of the organisation is met and above all management practices conform to various regulations are some of the main functions of HRM (McNamara, 1997). HR Impact on organisational performance and culture Good strategies alone cannot guarantee for long-term success rather many other factors impact organizational performance. Corporate culture is one such important factor is which aids an organization to create a high performance environment. Because culture is so important to the success of a firm, human resource professionals need to increase their significance at impacting culture. Culture is the environment that surrounds each ad every individual at work. In fact, culture is one of the most important aspects that determines the success and is such a powerful element that shapes work enjoyment, work relationships, and work processes. Unfortunately culture is not an element that can be seen physically and there by has its own limitations. If one has to compare culture and personality it is similar. An individual's personality is made up of the values, beliefs, underlying assumptions, interests, experiences, upbringing, and habits similarly it is the same with culture. Culture is also made up of the values, beliefs, underlying assumptions, attitudes, and behaviours. But the only difference is that it is shared by a group of people in an organisation. In simple terms culture defines the exact way in which people in an organisation think, act and work. Employees who fit into this culture can become successful and those who do not fit in to do things in the proper way do not last long with an organization. It is usually the senior management of an organisation who defines its culture. Top executives and leaders craft cultures which they consider will provide them with a competitive advantage over similar organisations. For instance, if the company competes in an industry that particularly relies on innovation, the HR management will create cultures where creativity and new ideas is consider the right way to think, act and work. The main purpose to have culture is to helps an organization adapt to its external environment as well as promote internal integration. In order to impact culture, HR management must work with top executives to help define what the organization considers right with regards to how people think, act and work. In today's world of business organisational culture is not just a "feel good" exercise rather, it is one of the most important and essential part. The final goal that should be kept in mind while outlining the culture should be to improve performance and commitment, both for the organization and for the individual. It is the responsibility of the HR to provide explanation to each and every aspect of the cultural norms set and give a detailed account of what will happen if these norms are not followed. It is important to explain the strengths and weaknesses of the cultures they create, if not followed they will have a much harder time achieving their organization objectives. More than the top executives the HR professionals have the liberty to create, sustain and modify corporate culture that helps to bring out the best in people. There are different areas in which HR management will have to take decisions and bring in modifications. With the help of good HRM in an organisation a self-motivation chip can be instilled in the organizational behaviour leading to excelling performance and commitment from the employees. To achieve it the HR department can develop a set of systems that can together create a highly motivational culture. For instance, payment, promotions, time management, trainings etc. can be a big part of success. Payment Systems Good payment is the one of the most important motivating factor for employee commitment. Additionally employees expect good compensation and reward systems. HR can use these mechanisms to motivate employees to perform in productive ways. While it is important to reward and compensated those employees who think, act and behave in the proper way, those who fall out should also be warned against their behaviour through messages. It is very essential that HR formulate the payment system in an unbiased manner. HR must also be careful when formulating such pay for performance reward programs. To effectively impact corporate culture, pay systems should reward not only expected outcomes, but also behavioural expectations. For instance, it is usual for HR to design a pay system that rewards based on productivity. But such narrowly defined expectations could be creating a culture that may harm the overall organizational success. Hence decisions taken on payments or rewards need to be always balanced. A very good example can be of an organization where sales employees were rewarded only on the number of sales they made. Sometimes this may create an unhealthy competition that may adversely impact the organisational culture. In such cases teamwork will not exist, employees only looked out for themselves, and many times employees ignore company policies in order to close the deal. Even with these negative behaviours, based on the pay system designed by HR, they are rewarded. Such a pay system does not support the corporate culture and in a long run harm the company. Performance Management It is the responsibility of the HRM to manage the performance of the employees in an organisation. Performance management programs can significantly impact corporate culture because they undoubtedly articulate to employees what is expected from them as well as provides a feedback mechanism to inform employees if they are being correct as outlined by the corporate culture. It is important to clearly formulate performance management systems to address employee behaviours and not just work objectives. By creating such a system it will aid in eliminating the mistakes from employees and unhealthy competitions can be that will have a greater impact on culture. So even though the organisational objectives may be met through good sales or productivity, if behaviour expectations are not the performance management process will point out this inconsistency to an employee so that their behaviours can be aligned with corporate culture. Performance management systems formulated by the HR need to have a strong element of differentiation. In other words those who think, act and work in the proper way according to the culture should be rewarded, given higher ratings, increases in payment and/or promotions than those that do not. On the other hand if performance management process simply gives every employee the same rating and/or increase regardless of whether they are thinking, acting or working properly, performance management process then does not impact corporate culture and it can be said that it is an inefficient system (Rodriguez, 2004). Time Management It is a well known fact that time is equally important as money. Hence the goal of HR is to teach the employee to work smarter rather than harder, and establish a life-work balance for more job satisfaction. It is a marvellous way of motivating people to work by getting them off their jobs before they consider work as a burden and do not perform their task properly. Today, this fact is well recognised in organisations and recreational activities are a main part of work. Hence HR plays an important development of off-hour recreation programs for employees to relax in the workplace. For instance, gymnasiums are nowadays part of any organization's premises, allow employees to even take a nap or just sniff pure oxygen during their lunch breaks. This approach encourages informal team activities and spirit to spread at the workplace. Unfortunately, the fact is that the more motivated people become, the more work and working hours they would seek. Recruiting and Selection The most important duty of HR is to select and recruit the best talents in the world. Talent acquisitions efforts impact organisational culture by determining the types of employees brought into the organization. Savvy HR professionals look for more than just the correct skills and capabilities in an applicant, they should also determine if the candidate will be a good cultural fit for the organization. To do this efficiently, HR must have full knowledge of the culture of the firm if they wish to decide if someone will fit into the culture. Each and every individual entering the organisation need to fit perfectly into the culture or at least need to be teachable so that they can adjust into the culture (El-Nadi, N.D.). Training and Development Highly developed form of human relations, people sensitivity training involving interpersonal skills development, teamwork, diversity management training is more needed than ever in order to harmonize human interaction in the workplace. If done correctly, this kind of training will be translated into positive, constructive employees' attitudes towards their organizations, their jobs, and their supervisors. Modern day organisations need more involvement with others and putting a combined effort. Therefore people have to undergo special training for developing interpersonal skills. Besides these training will also help individuals to identify a lot of hidden talents within themselves. A one time training programme will not be enough, rather repeat training programs may be helpful. Briefing sessions, group meetings, follow-up and progress reports, and organizational events and celebrations are proper venues to complete this objective (El-Nadi, N.D.). By focusing on training and development efforts, the HR can help employees to think, act and work in the much more productive manner than those who have not undergone any training. In this way HR can impact the culture of an organisation. Training programs can be designed to help employees demonstrate the behaviours desired by the corporate culture. Also, those who are successful within a culture should be given additional development opportunities so that they can assume positions of greater responsibility (Rodriguez, 2004). All these activities of HR directly and indirectly influence the organisational culture. In fact good payment system, time management, and employee friendly environment enhances commitment there by productivity of the organisation. Team building, leadership, development of interpersonal skills through in house training and development programs will not only benefit the organisation but also each and every individual. A number of researchers conducted around the world have already proved beyond doubt that HR is one of the most important and integral part of most of the organisations in the world today. HR activities can be converted into a source of competitive advantage for the firm. Some of the researches in particular studied how firms can create a competitive advantage from HR and their management practices (Schuler and Jackson, 1987). It is also proven beyond doubt that efficient HRM will produce a higher capacity to attract and increase commitment, hold employees qualified and motivated them for a good performance. It will also provide benefits from having sufficient and qualified employees. On the other hand, according to research conducted by Ulrich (1991) partially based his description of HR as a competitive advantage on the theory of resources and capacities of an organisation. In fact at first, he extended the competitive advantage pattern, proposed by Porter (1980), including organizational culture, distinctive competitiveness and strategic unit as 'mediators' in the relationship between strategic and competitive advantage. Then later on he enquired how firms can use HR practices to develop strategies that lead to a sustained competitive advantage, exhibiting the importance of the existence of a relationship among HR, strategies and the competitive advantage. "Strategic management is the ability of leaders to see their future ahead of others and to create products and services which will take advantage of this foresight. It is the ability of a firm's management to properly align itself with the forces driving change in the environment in which it competes." (Olsen, et al. 1998). Strategic management, especially the HR strategic management, are completely aware of the importance to know how they can configure HR management systems and practices, with the aim of developing a competitive advantage for the firm (Wright et al., 1994). If we have to define organizational commitment, it can be said that it is the relative strength of an employee's attachment or involvement with the organization where he or she is employed. Organizational commitment is one of the most important aspects because committed employees are less likely to look for another job and are more likely to perform much better at higher levels. Organizational commitment is a topic of growing significance to scholars and practitioners. There are many ways in which people look at organisational commitment but in general there are three dimensions: Firstly, emotional commitment is a feeling of emotional attachment towards the organisation in which an individual work. For example, an individual might say out of his or her heart that they work in a particular organisation as they like the people with whom they are working. Secondly, normative commitment is a feeling of obligation. For instance, an individual may think that when he or she required the job miserably, the organisation gave an opportunity and this opportunity might have been a life changing event in their life. Hence the individual remain committed towards the organisation. And finally, continuance commitment is a feeling that the costs of leaving are too high or it is too much trouble to go somewhere else. For instance, an individual is ignorant and is not aware of other opportunity, there by sticking on thinking that there are no other better options for him (Stup, 2006). Organizational commitment, which has been defined as "the relative strength of an individual's identification with and involvement in a particular organization" (Mowday, et al., 1982), is fostered when employees perceive that they are treated fairly and are valued for their contributions, when main promises have been met by the organization, and when employees develops enough trust in the organization (Allen et al., 2003; Gould-Williams, 2003; Wayne et al., 2002). Organizational commitment can also be improved through promotion identification and participation with the organization's goals and values (Meyer and Allen, 1991). Despite some critiques (Swailes, 2002), this attitudinal definition of organizational commitment is the most widely accepted and used in a number of research. A number of researches on different factors affecting commitment formation have been studied, including personal characteristics (educational background, gender), job characteristics (feedback), work experiences (group attitudes), and organizational characteristics ( which mainly revolves around HR practices) (Gould-Williams, 2003). In case of multinational corporations (MNCs) if we look at the commitment among employees the firms increasingly disperse critical assets ranging from R&D to technologically complex manufacturing to the global location that serves as the best platform for carrying them out (Bartlett and Ghoshal, 2000). As a result these links, and the employees working in them, are thus receiving greater strategic significance in the MNC's global success. Employees' in MNCs especially are recognised much more than those working in domestic firms. Their identification with the firm and willingness to work hard on its behalf are the reasons for success. Secondly, increasing international competition means that MNCs must optimise the performance of all their affiliates - the MNC must "push towards upgrading the internal capability of its subsidiaries" (Reade, 2001). This is mainly because of the international competition faced by these organisations. Therefore, this push places additional pressure on the MNC to retain high performing employees wherever they are. Thirdly, MNCs are more and more pushed by competitive forces to leverage the learning capability of their global networks (Bartlett and Ghoshal, 2000). Creation and transfer of knowledge mainly depend on the motivation and commitment of employees to undertake the complex and difficult organizational tasks of coordination and communication necessary to leverage knowledge for competitive advantage (Storey and Quintas, 2001). Despite these pressures to take care of stronger commitment in employees worldwide, still MNCs face greater difficulty when compared to domestic firms in creating and maintaining organizational commitment in employees. They also face more of cross cultural management issues when compared to domestic firms. Cultural diversity especially in MNCs can hamper the development of social unity between employees. HR managers in these organisations play much more important role in these organisations. In particular, geographic dispersion makes the task of communicating a combined vision and set of values more difficult, thus lowering organizational identification. Additionally, geographic distance from the main branch or the head office of the MNC can cause a sense of low involvement and employee unfriendliness among them. Located in overseas affiliates, employees are often far from the head office and decision-making, and hence may feel it is difficult to have an impact on the company commensurate with their knowledge and capabilities. In this case also the HR department takes appropriate steps to educate employees to work towards a common goal. Organizations are defined as 'individuals from different background working together to achieve common purpose and hold themselves collectively responsible for the results,' human interaction is thus emphasized. In other words communication becomes the main tool of both initiating and setting the right direction of this interface in the work-place to focus on accomplishing organizational goals and objectives. Here again the HR plays a very important role by making it clear to the entire staff these objectives. From the time of the earliest writers on organizational culture "it has been suggested that organizational culture affects such outcomes as productivity, performance, commitment, self confidence, and ethical behaviour". Likewise, more recent writers have repeated the assumption that "organizational culture impacts significantly on an organization, its employees' behaviour and motivations and, ultimately, that organization's financial performance" (Holmes and Marsden, 1996). Organizational culture has been argued to be relevant in a variety of contexts including the adoption of innovative technologies and workplace practices (McDermott and Stock, 1999), information systems integration (Weber and Pliskin, 1996), strategy implementation (Cabrera and Bonache, 51-60), and planning initiation (Harris, 117-126). Open communication at all level of management is crucial in involving employees in the buying-in the organizational culture and shared values. Studies proved that the productivity of the employees who realise their role in achieving organizational objectives is much higher than those who are doing what they are told to do in a directive way. Hence, communication here is used as an empowerment tool. Conclusion Finally, in today's world of increasing competition, each and every organisation needs a highly equipped HR department. Besides this department should develop integrated systems that combine selection of the best candidate, job-matching, continuous skills and competencies development, good payment, reward and compensation system, democratic leadership style, and creating attractive motivating work environments. Today there is an increasing trend that relies more on the quality of services and the fast response to the customer needs rather than the product itself. Hence, HR departments need to prepare efficient and effective training schedule that can be a source of knowledge and skill development. Identifying the best candidates through interviews and training them initially will provide an initial push to an employee. But continued support and interactions of HR with the employees will enhance trust and also aid in providing long-term commitment. HR professionals, have a key role to play in making themselves real 'strategic partners' in any organization. Employee commitment is strongly dependent on the organisational culture and the support from the HR. Hence it is important for the HR professionals to gain more credibility in proving their value in enhancing organizational performance. References Allen, D., Shore, L. and Griffeth, R. (2003) 'The Role of Perceived Organizational Support and Supportive Human Resource Practices in the Turnover Process', Journal of Management, 29: 99-118. Bartlett, C. A. and Ghoshal, S. (2000) Transnational Management: Text, Cases and Readings in Cross-Border Management (3rd edn). Boston: Irwin/McGraw Hill. Cabrera, E.F. and Bonache, J. 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