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CHAPTER ONE

CHAPTER ONE. Meeting Present and Emerging Strategic Human Resource Challenges. Review Key Environmental Challenges (external) Review Key Organizational Challenges (internal) Review Individual Challenges Discuss Planning and Implementing HR Policies – from a Strategic Prospective

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CHAPTER ONE

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  1. CHAPTER ONE Meeting Present and Emerging Strategic Human Resource Challenges

  2. Review Key Environmental Challenges (external) Review Key Organizational Challenges (internal) Review Individual Challenges Discuss Planning and Implementing HR Policies – from a Strategic Prospective Link HR Strategies and Firm’s Performance Briefly Look at Best HR Practices Review Key Terms Brain Drain Decentralization Downsizing Environmental Challenges Exempt Employees (salaried) Human Resource Strategies (HRS) Human Resource Tactic Human Resources (HR) Line Employees Managers Nonexempt Employees Outsourcing Staff Employees Chapter Objectives

  3. Key Terms • Human Resources (HR) - people who work in an organization (personal/associates/employees) • Human Resource Strategies (HRS) – the deliberate use a company’s human resources to gain a competitive advantage in the marketplace • Human Resource Tactics – policies or procedures put in place to gain that advantage

  4. More Terms • Managers – person who is in charge of others and is responsible for the timely and correct execution of actions that promote his or hers unit’s success • Line Employees – employees that directly produces a company’s goods or delivers a company’s services • Staff Employees - employees that support the line employees • Exempt Employees (salaried) – employees that do not receive extra pay for overtime (work beyond 40-hours per week) • Nonexempt Employees – workers that do receive overtime compensation

  5. Environmental Challenges Environmental Challenges: forces external to a firm – influence behavior but largely beyond management’s control • Rapid Change • The Internet Revolution • Workforce Diversity • Globalization • Legislation • Work/Life Balance • Skill Shortages & the Rise of the Service Sector • Natural Disasters

  6. Organizational Challenges Organizational Challenges – concerns that are internal to a company – effective mangers identify these issues and deal with them before they become a major issue for the company. This requires a company be proactive rather than reactive when dealing with HR issues • Competitive Position • Decentralization • Downsizing • Organizational Restructuring • Self-Managed Work Teams • The Growth of Small Businesses • Organizational Culture • Technology • Data Security • Outsourcing

  7. Individual Challenges • Individual Challenges – address the issues relevant to individual employees • Matching People and Organizations • Ethics and Social Responsibility • Productivity • Empowerment • Brain Drain • Job Insecurity

  8. Strategic Human Resource Planning • To be successful firms must align their HR strategies with: • Their organization’s overall strategies • The environment • Their organization’s characteristics • Their organization’s capabilities

  9. Strategic Human Resource Planning - The Benefits • Encouragement of Proactive Rather Than Reactive Behavior • Explicit Communication of Company Goals • Stimulation of Critical Thinking and Ongoing Examination of Assumptions • Identification of Gaps Between Current Situation and Future Vision • Encouragement of Line Managers’ Participation • Identification of HR Constraints and Opportunities • Creation of Common Bonds

  10. Strategic HR Planning -The Challenges • Maintaining a Competitive Advantage • Reinforce Overall Business Support • Avoiding Excessive Concentration on Day-to-Day Problems • Developing HR Strategies Suited to Unique Organizational Features • Coping with the Environment • Securing Management Commitment • Translating the Strategic Plan into Action • Combining Intended and Emergent Strategies • Accommodating Change

  11. HR Strategies & Company StrategiesBest Fit Fit - refers to the compatibly between the HR strategies and other important aspect the organization Evolutionary Business Strategy (flexibility, quick response, entrepreneurship, risk-sharing, decentralization) vs. Steady-State Strategy (efficiency, detailed work planning, internal grooming of employees for promotion, long-term career development, centralization)

  12. Work Flows Detailed work planning Explicit job descriptions Staffing Internal recruitment HR department makes selection decision Formal hiring process Employees Separations Hiring Freeze Concern for terminated workers Preferential rehiring policy Performance Appraisal Uniform appraisal procedure Used as a control devise High dependence on superior Training Individual training On-the job training Job-specific training “Make” Skills Compensation Fixed pay Seniority based pay Centralized pay decisions Defender Strategy (conservative businesses operating in a stable environment)

  13. Work Flows Innovation Flexibility Broad job classes Staffing External recruitment Coworkers makes selection decision Emphasis on ‘fit’ of coworkers with culture Informal hiring and socialization of new employees Employees Separations Layoffs Recruit as needed Individuals are on their own Performance Appraisal Customized appraisals Used as departmental tool Multiple inputs for appraisals Training Team-based or cross-functional training External training “Buy” skills Compensation Individual-based pay Performance-based pay Decentralized pay decisions Prospector Strategy(growth firms emphasizing innovation, new products and first to market)

  14. HR Strategies & the Environment -Best Fit • Degree of Uncertainty • How much accurate information you have to make decisions • Volatility • How often does your environment changes • Magnitude of Change • How drastic are the changes when they occur • Complexity • Sheer number of elements in the environment that effect the company and the industry (individually or together)

  15. HR Strategies & Organizational Characteristics Best Fit • The Production Process for Converting Inputs into Output • Routine vs. non-routine product production • The Firm’s Market Posture • Low-rate of growth/narrow market vs. wide market segment and high sales growth • The Firm’s Overall Managerial Philosophy • Autocratic leadership style/formal hiring procedures vs. risking taking and supervisors having a major role in hiring procedures • The Firm’s Organizational Structure • Highly formalized HR systems vs. less regimented • The Firm’s Organizational Culture • Moral commitment vs. entrepreneurial climate

  16. HR Strategies & Organizational Capabilities Best Fit Leveraging your firms distinctive competencies to give your company a competitive advantage: • Technical abilities • Management Systems • Reputation

  17. HR Best Practices • Employment Security • Selectivity in Recruiting • High Wages • Incentive Pay • Employee Ownership • Information Sharing • Participation & Empowerment • Self-managed Teams • Training & Skills Development • Cross-Utilization and Cross-training • Promotion from Within

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