Strategic Human Resource Management Insights for Competitive Advantage

1. Chapter 1The Rewards and Challenges of Human Resource Management

2. Learning Outcomes • Explain how human resources managers and other managers can have rewarding careers by helping their firms gain a sustainable competitive advantage through the strategic utilization of people • Explain how good human resources practices can help a firm’s globalization, corporate-social responsibility, and sustainability efforts • Describe how technology can improve how people perform and are managed

3. Learning Outcomes • Explain the dual goals HR managers have in terms increasing productivity and controlling costs • Discuss how firms can leverage employee differences to their strategic advantage and how educational and cultural changes in the workforce are affecting how human resources manager engage employees • Provide examples of the roles and competencies of today’s HR managers and their relationship with other managers

4. Human Resource Management • Process of managing human talent to achieve an organization’s objectives • Employees and managers with better understanding of the firm’s business • Help achieve its strategies through effective utilization of people and their talents

5. Human Capital and HRM • Human capital: Knowledge, skills, and capabilities of individuals that have economic value to an organization • Managers should develop strategies for: • Identifying, recruiting and hiring the best available talent • Developing employees in firm specific ways • Helping employees generate new ideas and generalize them throughout the company • Encouraging information sharing • Rewarding collaboration and teamwork

6. Figure 1.1 - Overall Framework of Human Resource Management

7. Responding Strategically to Changes in the Marketplace • Making adjustments to the labor force via: • Downsizing: Planned elimination of jobs • Outsourcing: Hiring outside the company to perform business processes previously done within the firm • Offshoring: Sending jobs to other countries • Adopting cost-cutting strategies • Enhancing benefit programs • Improving quality • Expanding market shares and product lines

8. Responding Strategically to Changes in the Marketplace • An organization that successfully engineers change: • Links it to the business strategy • Shows how it creates quantifiable benefits • Engages key employees, customers, and suppliers early • Makes an investment to implement and sustain it

9. Competing, Recruiting, and Staffing Globally • Companies make it possible for consumers to buy anything, anytime, anywhere • Engage in partnerships, mergers, and acquisitions • Globalization is blurring national identities of products • Lower trade barriers with free-trade agreements • General Agreements on Tariff and Trade (GATT) paved the way for North American Free Trade Agreement (NAFTA) and the European Union • GATT was replaced by the World Trade Organization (WTO)

10. Competing, Recruiting, and Staffing Globally • Issues relating to different geographies affect HRM • Different cultures, employment laws, and business practices • Safety of employees and facilities abroad

11. Setting and Achieving Corporate Social Responsibility and Sustainability Goals • Corporate social responsibility: Responsibility of firms to act in the best interests of the people and communities affected by its activities • Sustainability: Ability to produce goods or services without damaging the environment and depleting the world’s resources • Good reputation for pursuing such efforts can enhance company revenues and improve their ability to attract good talent

12. Technology Challenges • Organizations are leveraging information explosion • Collaborative software: Allows workers to interface and share information with one another electronically • Shift from touch labor to knowledge workers • Knowledge workers: Workers whose responsibilities extend beyond the physical execution of work to include planning, decision-making, and problem-solving • Human resources information system (HRIS) • Streamlines HR processes, makes information readily available to managers and employees, and enables HR departments to focus on the firm’s strategies

13. Productivity and Cost Challenges • Productivity - Output gained from a fixed amount of inputs • Can be increased by reducing inputs and adding more human and physical capital to the process • Size of workforce should be managed to maximize productivity and contain costs • Offshoring • Outsourcing • Nearshoring: Bringing jobs closer to domestic countries

14. Productivity and Cost Challenges • Homeshoring: Outsourcing work to domestic workers who work out of their homes • Furloughing: Practice of requiring employees to take time off for either no pay or reduced pay • Hiring part-time employees • Employee leasing: Dismissing employees who are then hired by a leasing company and contracting with that company to lease back the employees

15. Employee Challenges • Workforce is increasing in diversity • Organizations are doing more to address employee concerns and maximize benefits of different employees • HR managers should be aware of the educational abilities of employees in the organization • Shift of cultural dynamics in labor force are affecting: • Employee rights and privacy concerns • Attitudes towards work • Employee engagement: Extent to which employees are enthused about their work and committed to it • Efforts to balance work and family

16. Role of HR Managers and Their Partnership with Other Managers • Responsibilities of HR managers • Strategic advice and counsel • Service • Policy formulation and implementation • Employee advocacy • Successful organizations combine the experience of line managers with the expertise of HR managers • To develop and utilize the talents of employees to their greatest potential • Line managers: Non-HR managers who are responsible for overseeing the work of other employees

17. Figure 1.7 - Human Resource Competency Model