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Challenges of HRM

The HRM Challenges

Going Global
Embracing New Technology
Managing Change
Managing Talent or Human Capital
Responding to the Market
Containing Cost
The trend toward opening up foreign markets to international
trade and investment
Partnerships with foreign firms
Anything, anywhere, anytime markets
Lower trade and tariff barriers
Different geographies, cultures, laws, and practices
Identifying people who work overseas
Developing culture and work practices
Adjusting Compensation plans

Embracing New Technology
Unlimited data can be stored, retrieved and used
Effects on HRM
Reduce the jobs and increase the jobs
Transformation from touch labor to knowledge worker
Managing displacement, redundancy, retraining and
managing the knowledge workers

Managing Change
Types of Change
Reactive change: Change that occurs after external forces have already
affected performance
Proactive change : Change initiated to take advantage of
targeted opportunities
Managing Change through HR
Formal change management programs help to keep employees
focused on the success of the business
Why Change Efforts Fail?

Not establishing a sense of urgency.
Not creating a powerful coalition to guide the effort.
Lacking leaders who have a vision.
Lacking leaders who communicate the vision.
Not removing obstacles to the new vision.
Not systematically planning for and creating short-term
Declaring victory too soon.
Not anchoring changes in the corporate culture

Managing Talent, or Human Capital
Human Capital
The knowledge, skills, and capabilities of individuals that
have economic value to an organization.
Valuable because capital:
is based on company-specific skills.
is gained through long-term experience.
can be expanded through development
Responding to the Market

Total Quality Management (TQM)
A set of principles and practices whose core ideas include
understanding customer needs, doing things right the first
time, and striving for continuous improvement.
Six Sigma
A process used to translate customer needs into a set of
optimal tasks that are performed in concert with one

Responding to the Market (contd)
Reengineering and HRM
Fundamental rethinking and radical redesign of business
processes to achieve dramatic improvements in cost,
quality, service, and speed.
Requires that managers create an environment for
Depends on effective leadership and communication
Requires that administrative systems be reviewed and

Containing Costs
The planned elimination of jobs (head count).
Contracting outside the organization to have work done that
formerly was done by internal employees.
The business practice of sending jobs to other countries.
Employee Leasing
The process of dismissing employees who are then hired by a
leasing company (which handles all HR-related activities) and
contracting with that company to lease back the employees