Transcript Strategic Human Resource Management

CHAPTER 1
AN INVESTMENT
PERSPECTIVE OF
HUMAN RESOURCE
MANAGEMENT
The Strategic View of Human Resources
• Employees are human assets that increase in value
to the organization and the marketplace when
investments of appropriate policies and programs
are applied.
• Effective organizations recognize that their
employees do have value, much as same as the
organization’s physical and capital assets have
value.
• Employees are a valuable source of sustainable
competitive advantage.
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Sources of Employee Value
• Technical Knowledge
– Markets, Processes, Customers, Environment
• Ability to Learn and Grow
– Openness to new ideas
– Acquisition of knowledge and skills
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Decision Making Capabilities
Motivation
Commitment
Teamwork
– Interpersonal skills, Leadership ability
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Valuation of Human Assets
• Implications for Individuals and Organizations
– Determination of compensation
• Internal and external equity for employees in return for their
contributions to the organization.
• Organization placement of resources and returns on employee
development are aligned and well-matched.
– Advancement opportunities
• Developing current employees creates motivation and permits
promotion from within.
– Development of retention strategies
• Effective means of retaining valuable employees allows for
the recapture of the invested costs of their development.
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Investment Orientation
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The Investment-Oriented Organization
• Organizational Characteristics
– Sees people as central to its mission/strategy.
– Has a mission statement and strategic objectives that
espouse the value of human assets in achieving goals.
– Has a management philosophy that encourages the
development and retention of human assets and does not
treat or regard human assets in the same ways as physical
assets.
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Investment Orientation Factors
• Senior Management Values and Actions
– An organization’s willingness to invest in its human
resources is determined by the “investment orientation” of its
managers.
• Attitude Toward Risk
– Investment in human resources is inherently riskier due to
lack of absolute “ownership” of the asset.
• Nature of Skills Needed by Employees
– The more likely that skills developed by employees are
marketable outside the firm, the more risky the firm’s
investment in the development of those skills.
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Investment Orientation Factors
• Utilitarian (“Bottom Line”) Mentality
– An attempt is made to quantify employee worth to the
organization through a cost-benefit analysis.
– The “soft” benefits of HR programs and polices are difficult
to objectively quantify because they affect many different
organizational areas and have differential effects on
individual employees.
• Availability of Outsourcing
– If cost-effective outsourcing is available, investments will be
made only in HR activities producing the highest returns and
largest sustainable competitive advantages.
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CHAPTER 2
TRENDS AFFECTING
HUMAN RESOURCE
MANAGEMENT
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Major Factors Affecting HRM
Technological
Advancement
Demographics
and Diversity
Strategic
HRM
Globalization
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Technology and HRM
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Technology Challenges for HRM
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Workforce Demographic Changes
• The “Graying” of the Workforce
• Negative Aspects of Older Workers
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Perceived resistance to change by older workers.
Increased health-care costs for senior workers
Blocking advancement opportunities for younger workers
Higher wage and salary costs for senior workers
• Positive Aspects of Older Workers
– As productive or more productive than younger workers
– Have more organizational loyalty than younger workers
– Possess broader industry knowledge and professional
networks
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Workforce Demographic Changes
• Baby Boomers (1945–1962)
– In excess supply in middle management ranks
– HR challenge is to manage “plateaued” workers
• Baby Busters (1963–mid-1970s)
– Are career bottlenecked by the Boomers
– Who have skills in high demand are doing and will do well
• Generation “X”ers (late 1970s–early 1980s)
– Have life-long exposure to technology and constant change
– Seek self-control, independence, personal growth, creativity
– Are not focused on job security or long-term employment.
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New Employee/Workplace Dynamics
• Emphasis on the Management of Professionals
– Establishment of separate career tracks
• Technical/Professional, Managerial /Administrative
– Use of project teams
• Less Employee Loyalty, More Loyal to Self
– Staying with employers for shorter periods; demanding more
meaningful work and involvement in organizational decisions
• Increased Personal and Family Dynamic Effects
– More single-parent families, dual-career couples, and
domestic partners
• Increased Nontraditional Work Relationships
– Part-time, consulting, and temporary employment flexibility
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Managing Workplace Diversity
• Understanding and Appreciating Diversity
– Is critical to effectively marketing to ethnic and minority
groups
– Is promoted by having a diverse workforce at all organization
levels
– Helps ensure that hiring and promotion decisions are
unbiased by person differences
• Diversity Management Programs/Initiatives
– Must be integrated with organization’s mission and
objectives
– Help key decision makers identify diversity’s benefits to the
organization
– Make critical decisions about implementing the optimal
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