Meeting Present and Emerging Strategic Human Resource Challenges Divakar Dubey – ( HR Head – MTPL ).

How can HR influence firm performance? How can HR cope with Challenges facing HR How can HR influence firm performance? How can HR cope with workplace changes and trends? What are HR strategies that help a firm achieve competitive advantage? Divakar Dubey – ( HR Head – MTPL ).

Key HR Challenges for Today’s Managers: Environmental Rapid change Workforce diversity Globalization Internet revolution Legislation Evolving work and family roles Skill Shortages Rise of the service sector Environmental challenges are the forces external to the firm. They influence organizational performance but are largely beyond management’s control. Managers need to monitor the external environment constantly for opportunities and threats. This slide demonstrates how a variety of environmental factors impact the organization.

Key HR Challenges for Today’s Managers: Organizational Competitive Position: Cost, Quality, distinctive capabilities Decentralization Downsizing Organizational restructuring Self-managed work teams Small business growth Technology Outsourcing Divakar Dubey – ( HR Head – MTPL ).

Key HR Challenges for Today’s Managers: Cultural Basic assumptions and beliefs shared by members of an organization… rules, norms behaviors philosophy dominant values feeling or climate The term organizational culture refers to the basic assumptions and beliefs shared by members of an organization. These beliefs operate unconsciously, are taken for granted, and are typically very apparent to someone outside the organization. This slide illustrates the key elements of organizational culture, and the ways in which these elements differ between two organizations.

Individual Challenges Key HR Challenges for Today’s Managers: Individual Matching People and Organization Matching people and organizations Ethical dilemmas Social responsibility Productivity Empowerment Brain drain Job insecurity

Mission Statement: Otis Elevator Our mission is to: provide any customer a means of moving people and things up, down and sideways over short distances with higher reliability than any similar enterprise in the world. Mission statements have become useful tools that an organization may use to clarify the essential strengths and purposes of an organization, as well as point to where the organization would like to go.

CODE OF ETHICS: As a member of the American Marketing Association, I recognize the significance of my professional conduct and responsibilities to society and to other members of my profession: 1. By acknowledging my accountability to society as a whole as well as to the organization for which I work. 2. By pledging my efforts to assure that all presentations of goods, services, and concepts be made honestly and clearly. 3. By striving to improve marketing knowledge and practice in order to better serve society. Expectations that employers will behave ethically are increasing. Many firms and professional organizations have created codes of ethics outlining principles and standards of personal conduct for their members. This slide, and the next, represent the code of ethics of the American Marketing Association. Unfortunately, these codes often do not meet employees’ expectations of ethical employer behavior. Polls have indicated that almost half the respondents believe that managers do not consistently make ethical decisions.

Code of Ethics (cont’d) 4. By supporting free consumer choice in circumstances that are legal and are consistent with generally accepted community standards. 5. By pledging to use the highest professional standards in my work and in competitive activity. 6. By acknowledging the right of the American Marketing Association, through established procedure, to withdraw my membership if I am found to be in violation of ethical standards of professional conduct.

HR Strategy Leads to Improved Organizational Performance Organizational Strategies Organizational Capabilities HR Strategies The success of HR strategies depends on the situation or context in which they are used. An HR strategy’s effect on firm performance is always dependent on how well it fits with other factors. This slide depicts the key factors that firms should consider in determining which HR strategies will have positive impact on firm performance: organizational strategies, environment, organizational characteristics, and organizational capabilities. Organizational Characteristics Environments

Porter’s Differentiation Strategy Efficient production Explicit job descriptions Detailed work planning Emphasis on technical skills Emphasis on job-specific training Emphasis on job-based pay Use performance appraisal A differentiation business strategy attempts to achieve a competitive advantage by creating a product or service that is perceived as unique. Approaches to differentiation can take may forms, among them: design or brand image; technology; features; customer service; and dealer networks.

Porter’s Low-cost Leadership Strategy Efficient production Explicit job descriptions Detailed work planning Emphasis on qualifications and skills Emphasis on job-specific training Emphasis on job-based pay Use of performance appraisal The overall cost leadership strategy is aimed at gaining a competitive advantage through lower costs. Cost leadership requires aggressive construction of efficient plant facilities, intense supervision of labor, vigorous pursuit of cost reductions, and tight control of distribution costs and overhead.

Porter’s Focus Strategy Low cost Differentiation A focus strategy relies on both a low-cost position and differentiation, with the objective of serving a narrow target market better than other firms. The HR strategies likely to fit the focus strategy best would be somewhere in the middle of those described for low-cost producers and differentiators.

Miles and Snow Defender Strategy -- RECRUITING Internal recruitment HR makes selection decision Emphasis on qualifications and skills Formal hiring and socialization process Divakar Dubey – ( HR Head – MTPL ).

Miles and Snow Prospector Strategy -- RECRUITING External recruitment Supervisor makes selection decision Emphasis on applicant fit with culture Informal hiring and socialization process of new employees

Miles and Snow Defender Strategy -- Compensation Fixed pay Job-based pay Seniority-based pay Centralized pay decisions

Miles and Snow Prospector Strategy --Compensation Variable pay Individual-based pay Performance-based pay Decentralized pay decisions

LEADERSHIP How HR can be a Strategic Partner Understand styles of leadership Display appropriate leadership Demonstrate leadership at all levels of performance – team, individual, unit or organization For the sake of the firm, managers and the HR department need to work together closely. Lack of cooperation has traditionally been a problem. The next five slides highlight five competencies required of HR departments in order that they might be strategic partners with management. Companies can take certain steps to foster an effective partnership between managers and HR department. Companies should: (1) Analyze the people side of productivity rather than depend solely on technical solutions to problems. (2) View HR professionals as internal consultants who can provide valuable advice and support that improve the management of operations. (3) Instill a shared sense of common fate in the firm rather than a win/lose perspective among individual departments and units. (4) Require some managerial experience as part of the training of HR professionals. (5) Actively involve top corporate and divisional managers in formulating, implementing, and reviewing all HR plans and strategies in close collaboration with the HR department. (6) Require senior HR executives to participate on an equal basis with other key managers from the various functional areas (marketing, finance) involved in charting the enterprise’s strategic direction.

KNOWLEDGE OF BUSINESS How HR can be a Strategic Partner HR must understand… internal / external customers key business disciplines business structure, vision, values, goals, strategies, finances competitors, products, technology and sources of competitive advantage Divakar Dubey – ( HR Head – MTPL ).

STRATEGIC THINKING How HR can be a Strategic Partner Understand strategic business planning Apply a systematic HR planning process Integrate HR systems to build capability and competitive advantage for the firm Develop and integrate department strategies within corporate framework Divakar Dubey – ( HR Head – MTPL ).

PROCESS SKILLS How HR can be a Strategic Partner Know management processes Know process skills: consulting, problem solving, evaluation and communication Understand organizational development Facilitate and manage change Manage under uncertainty and instability Divakar Dubey – ( HR Head – MTPL ).

TECHNOLOGY How HR can be a Strategic Partner Maintain HR documentation using knowledge management and technology Build firm’s capability using info systems Provide training in use of technology Divakar Dubey – ( HR Head – MTPL ).

Case XYZ has a 1 billion budget and staff of 7,000. To speed growth, XYZ announced a series of performance objectives for individual business chiefs who before enjoyed much free rein. In addition, XYZ introduced specially trained “black belts” to root out inefficiencies in departments. If you were a “black belt”, what would you look for? Students should identify many of the concepts presented in this chapter, including individual challenges, organizational challenges, cultural challenges, ethical dilemmas and environmental challenges.