Competitive challenges to HRM

Technological Changes Workforce Diversity

Challenges faced by Human Resource Managers

There may be various challenges that a human resource manager might face: 1. Technological changes 2. Workforce diversity 3. Change management 4. Outsourcing 5. Health and welfare 6. Recruitment and availability of skilled labour 7. Retention and succession planning
8.

Restructuring

9. Industrial relations 10.Employee compensation and rewards 11.Retirement

Technological changes : challenge to HRM

Introduction

Traditionally human resource management (HRM) has had a people-oriented approach. However today, when the competitive demands of the marketplace require a reorientation of strategic human resource philosophies and practices, an emphasis are being given to a knowledge-based administration using technology as a tool.

Todays human resources (HR) tasks cover an ample variety of activities requiring very different skill sets, from compensation and benefit administration (highly quantitative) to employee relations (highly qualitative) Traditional Vs. Contemporary Technology requires a person to have fewer skills to operate than manual work. Skilled workers accept to work as less skilled worker or they leave. Or they are replaced by cheaper labour with fewer skills. This is called Deskilling changing the work using technology that requires fewer skills. However, technology has helped remove some boring and dangerous jobs. Technology makes existing workers more efficient. Checkout operators operate faster, accurately and hence fewer workers are required. Increasingly efficient production minimum wastage, damage & errors and improved & consistent quality. Selection test must be revised to match the requirements of the new job. Teamwork, communication and multi-skills are essential. Job description needs to be changed to describe the new jobs, tasks and responsibilities. Reduced employment in areas where technology has been introduced. Creation of new jobs where Technology has been introduced. Many workers have become deskilled. As a result: type of employees, skills, training and induction will need to be modified from the old system to fit the new. Today workers need multi-skills for different jobs and they are likely to change their jobs a few times. New technology requires new knowledge, skills, perception and behaviours. Formal training must be provided to existing employees. Effective and efficient training must be provided for the new technology. So T&D with performance appraisal and reward system that reinforce those behaviors are required. As previously mentioned, today workers need multi-skills for different jobs and they are likely to change their jobs a few times. Multi-skilling refers to expanding the skill level of an individual. As a result the individual can perform a wide range of tasks. It opens up wider career options. It prepares the organizations for future needs. Induction has become more important. It enables the worker to understand the job requirements and fit well into the technological culture. Redundancies are becoming common partly due to new technology. Retrenchment packages must be updated and other services made available like counselling. Some jobs disappeared (we no longer need Typists) (watchmaker not needed due to digital watches). To be considered successful HR technology must achieve several goals, as described: (a) Strategic alignment, which must support the goals of a business by helping users.

(b) Business intelligence, which should inspire new insights and learning, by providing users with relevant information and data, and by answering questions. (c) efficiency and effectiveness, which must change the work performed by HR personnel, by dramatically improving their level of service, allowing more time for work of higher value, and reducing their costs Holistic model of human resource management practices

The HR technology can help organizations meet their business goals and objectives today and in the future by: Helping managers deploy their workers more efficiently. Ensuring that workers receive proper training and development. Offering new insights on how to increase productivity. Enabling employees and managers to receive needed information faster. Reducing HR administrative costs. Assisting with better employee assessment and selection recent studies of HR management and business performances have found that HRs adopted high involvement practices have resulted in significantly positively associated improvement on market value, rate of return on capital employed, revenue growth, revenue-per-employee rate, productivity, product/service quality, and even organizational survival

The use of technology by HR has proven to assist on the improvement of business performances. However, it was explained that, although we expect all businesses to have

embraced this high involvement on technology, only about one of every eight business has done so. Probably a solution for this lack of high involvement on technology is for businesses to adopt an HR philosophy which understands that todays customers and clients are used to a technological experience It is the fundamental on the strategy for HRM improvement Technology is the practical application of science to commerce or industry; the study of or a collection of techniques; a particular technological concept; the body of tools and other implements produced by a given society. Technology is here and will continue to progress. To understand the role technology plays on todays HRM we first have to understand business technology: Business technology refers to the integration of computer and communications technologies in support of administrative applications and procedures within an organization. Business technology is constantly evolving. Business technology is required for a successful business. It is no longer enough for HRM to maintain a narrow operational focus, view its activities as restricted to the limits of its own organization, or to limit itself to traditional human resource (HR) responsibilities, HRs should go above and beyond.

The HR field has evolved over time and nowadays HR is under more scrutiny and is more accountable than ever. There is little room for mistakes, which can be overwhelming costly. HRs these days and in the near future have a greater importance in the strategic business partnership with the organization, and for this challenge to be won there is an increasing need for technology to be inserted on its daily operations and on its decision-making considerations. The Impact of Technology in Human Resource Management Prior to the Industrial Revolution most people worked either close to or in their homes. However, mass production technologies changed this and people began to travel to work locations or factories. Today, with increased computer technology, there is a move for many to work from anywhere; people are no longer necessarily anchored to one place. Computer technology, especially the Internet, changed that. The trends in technology which directly or indirectly have an impact in HRM are:

Growth in knowledge needs: World trade is growing over three times faster in knowledge-intensive goods and services such as biomedicine, robotics, and engineering. Shift in human competencies: Some predict that in 2015 almost all net employment growth will be in knowledge workers. Global market connection: Technology is dissolving borders and creating an interconnected marketplace. Business streamlining: Easy to use communication, electronic mail, electronic conferencing, and databases are creating instantaneous dissemination of data to make better decisions to geographically dispersed workers. Rapid response: Technology permits quicker communications, which allows faster decision-making. Quicker innovation: Teams of marketing, engineering, and production personnel working in parallel with computer provided files, data, and information develop products faster. Quality improvement: The concept of building quality into the entire process of making, marketing, and servicing is enhanced by computer monitoring systems and through robotics

Current Techno-Challenges
1.

Artificial Intelligence: Artificial intelligence will definitely give a number of workers access to expert systems - computerized programs that capture the knowledge & decision making approaches to experts. As the capabilities of artificial intelligence give people and machines greater problem-solving powers, jobs and skills they require with change dramatically, affecting the employment, training, and development, compensation, and employee relations activities of the HR department. Office Automation: Automation is another way in which technology affects the field of HR management. The introduction of computers into banks changed employment needs. HR departments of banks had dramatically changed their recruiting & training programs. Before computers, HR specialists recruited large numbers of unskilled and semiskilled clerks. Computers, however, required highly skilled programmers & systems analysts. Advanced Transportation: The technology of cars and airplanes modified the transportation industry. Automobile and aviation companies grew, creating a demand for more employees and training. For those already employed by these firms, growth provided promotional opportunities. Railroad companies were also affected, except that the HR management challenges differed. Revenue lost to cars,

2.

3.

trucks, and airplanes limited growth. HR departments in these companies had to reduce the work force and create early retirement systems.

Human Resource Information Systems (HRIS) An HRIS serves two major purposes in organizations: (1) Improves the efficiency with which data on employees and HR activities are compiled (2) Having accessible data enables HR planning and managerial decisions making to be based to a greater degree on information rather than relying on managerial perceptions or intuitions. An HRIS has many benefits for an organization; one of the most frequently used is the automation of payroll and benefit activities. The Internet Economy and HR The widespread adoption of the Internet by business and people there is a greater use of electronic business (e-business) processes. E-business includes several forms of buying and selling products and services, such as:

Business-to-consumer transactions. Per example: purchasing books and tickets, and conducting services including banking online. Business-to-business transactions. This is when there are transactions between manufactures and wholesalers, and between wholesalers and retailers. Consumer-to-consumer transactions. An example would be the website ebay.com.

E-business relies on the Internet to obtain product information online, directly order products and services, receive after-sale technical support, and view the status of orders and deliveries. E-businesses create many challenges for HRM departments because of the fast pace of changes on information technology. HRMs are required to continually update their skills requirements and then recruit and train people to meet these requirements.

Workforce diversity as a challenge to HRM

Diversity:

Concept: Human characteristics and experiences that make people different, dissimilar or unlikely from one another is called diversity.

Definition: Diversity is generally defined as acknowledging, understanding, accepting, valuing, and celebrating differences among people with respect to age, class, ethnicity, gender, physical and mental ability, race, sexual orientation, spiritual practice, and public assistance status.

It is the exploration of these differences in a safe, positive, and nurturing environment. It is about understanding each other and moving beyond simple tolerance to embracing and celebrating the rich dimensions of diversity contained within each individual.

Workforce Diversity:
Workforce diversity means inclusion of people within a workforce who are considered to be, in some way, different from those in the prevailing constituency.

A workforce consisting of a broad mix of workers from different racial and ethnic backgrounds of different ages and genders of different domestic and national cultures is known as a diverse workforce.

Dimensions of diversity:

1. 2. 3. 4. 5. 6.

Primary dimensions: Age Gender Race Physical ability Ethnicity Sexual orientation

1. 2. 3. 4. 5. 6. 7.

Secondary dimensions: Education Religious beliefs Geographical location Income Marital status Parental status Work background

Challenges for management: Resistance: Every workplace has people who resist diversity and the changes it brings, even in the most positive of environments. These negative
1.

attitudes can damage morale, slow down positive change and decrease productivity, so resistance becomes a challenge for managers.

Poor communication: In a diverse work environment, people with different age groups, gender, religions come together. Along with these differences come a variety of communication styles. One of the main challenges of managing diversity is poor communication between employees. This can again lead to damaged productivity of the organisation if message is poorly interpreted.
2.

Conflicts: People that come from different cultural backgrounds have different perspectives on how to handle issues or concerns that arise. If employees in an organisation do not recognize other persons way of thinking and perceiving conflicts may arise. When employees feel like they cannot reach a point of agreement in conflict they may give up and simply let the ill feelings foster and create a negative tone. This leads to employee dissatisfaction and hence reduced output.
3.

Turnover: Dissatisfied employees that feel like the work environment is unsafe will leave. Constantly replacing employees involves high cost as the company has to pay to hire and train replacements. The business risks losing top talent to competitors if the workplace does not provide a safe and motivating culture where employees from diverse backgrounds are welcomed and treated fairly.
4.

Mindset about diversity: Most of the employees in an organisation diversity as a problem but not an opportunity. Their pessimistic outlook towards diversity creates a pre notion that diversity will lead to problems like difference in thinking and adjustment rather than thinking about pool of talents and different working styles.
5.

Acceptance of diversity: Highest level

Integration Integrate differences and adapting them

Adaptation Empathise with people of other Acceptance Accepting behavioural differences Recognizing other ways of thinking & perceiving Minimising difference Hiding cultural differences Focusing on similarities among people

Defensive Assumes own culture superior

Denial No respect of cultural differences Claim other cultures to be

Lowest level

Managing diversity: Accept cultural diversity

1. 2. 3. 4.

Understand the differences. Learn about other cultures. No discrimination in recruitment or compensation. Fair HR policies and programmes.

5. 6. 7. 8.

Understand discrimination and its consequences. Ongoing training of managers. Avoid being judgemental.

Create a formal forum to teach employees about customs and cultures represented in the firm.

1. 2. 3. 4. 5.

Improve oral and written communication Define the terms which people need to know on the job. Use familiar words. Be concise. Adjust the messages according to the education level of employees. Reduce language barrier.

1. 2.

Access how well you have been understood Research the non-verbal reactions of other cultures. Be alert to facial expressions.

3. Observe how employees use the information provided to them and review any misunderstood points.

1.
2.

Offer feedback to improve communication Discuss a persons behaviour and the situation.

Be supportive and reassure individuals that their skills and contributions are important.

Practices that a HR manager can adopt in ensuring effective management of workplace diversity in order to attain organizational goals. They are:

1. Planning a Mentoring Program-One of the best ways to handle workplace diversity issues is through initiating a Diversity Mentoring Program. This could entail involving different departmental managers in a mentoring program to coach and provide feedback to employees who are different from them. In order for the program to run successfully, it is wise to provide practical training for these managers or seek help from consultants and experts in this field. Usually, such a program will encourage organizations members to air their opinions and learn how to resolve conflicts due to their diversity. More importantly, the purpose of a Diversity Mentoring Program seeks to encourage members to move beyond their own cultural frame of reference to recognize and take full advantage of the productivity potential inherent in a diverse population. 2. Organizing Talents Strategically-Many companies are now realizing the advantages of a diverse workplace. As more and more companies are going global in their market expansions either physically or virtually (for example, Ecommerce-related companies), there is a necessity to employ diverse talents to understand the various niches of the market. 3. Leading the Talk-A HR Manager needs to advocate a diverse workforce by making diversity evident at all organizational levels. Otherwise, some employees will quickly conclude that there is no future for them in the company. As the HR Manager, it is pertinent to show respect for diversity issues and promote clear and positive responses to them. He/She must also show a high level of commitment and be able to resolve issues of workplace diversity in an ethical and responsible manner. 4. Control and Measure Results-A HR Manager must conduct regular organizational assessments on issues like pay, benefits, work environment, management and promotional opportunities to assess the progress over the long term. There is also a need to develop appropriate measuring tools to measure the impact of diversity initiatives at the organization through organization-wide feedback surveys and other methods. Without proper control and evaluation, some of these diversity initiatives may just fizzle out, without resolving any real problems that may surface due to workplace diversity.

Source:
http://gladstone.uoregon.edu/~asuomca/diversityinit/definition.html

http://dictionary.reference.com/browse/diversity

http://edis.ifas.ufl.edu/hr022

http://www.questia.com/googleScholar.qst?docId=5000256363

http://www.managementstudyguide.com/hr-challenges.htm

http://www.streetdirectory.com/travel_guide/11069/business_and_finance/the_chall enges_of_human_resource_management.html