Organizational Dynamics And Human Resources Management Management Essay

The terms Human Resource Management and Human Resources have replaced what was known as Personnel Management when it comes to describing the processes involved in managing people in organisations. The current trend towards people-oriented activities can serve the modern business challenges more effectively than the traditional Personnel Management approach.

Naturally in a rapidly and constantly changing business environment, there is a call for more human resources involvement and more focus on human resource strategies in conjunction with the business strategies. Meanwhile there is evidence of devolving traditional human resource activities to line managers instead of personnel specialists.

Recently, much of the work traditionally done by the human resources department has been devolved to line managers, who are now expected to take charge of people management activities such as, recruitment, selection, appraisals and training needs. This trend is encouraged as it leads to a closer relationship between line managers and employees, and hence leading to better employee performance and increased manager’s effectiveness.

Torrington and Hall (2009) suggest that sharing HR activities between line managers and HR specialists is the key for a strategic HRM future, where HR specialists focus on business performance rather than operational concerns. This report highlights the significant role that line managers in HR activities while emphasising the importance of an HR specialist role for long term performance benefits.

The Concept of Human Resource Management:

HRM is defined as an approach to the management of people, the most valued assets of an organisation with their individual and the collective contribution to the success and achievement of the business objectives. Furthermore, Alan Price identifies HRM in ‘Human Resource Management in a Business Context’ (2004) as the qualitative improvement of human beings who are the most valuable assets of an organisation. Hence HRM is concerned with the effective management of an organisation’s employees to achieve the strategic objectives of the business.

Dave Ulrich (1996) defined four fields for the HRM role

Strategic business partner

Change management

Employee champion

Administration

However, HR professionals have struggled to prove their value as a strategic business partner and were mainly concerned with the reactive roles of administration and employee champion despite the modern approach to devolve HR activities to line management.

The Role of Line Managers in HR:

Line managers have a major role in influencing employee behaviours and attitudes which reflects on performance and motivation. The increased responsibilities are mainly focused on people management where line managers could transform HR policies into practices to be embraced by employees leading to commitment, quality, productivity and ultimately, business performance (Hutchinson and Purcell, 2003).

The CIPD highlighted the areas four areas where line managers can influence people management practices:

Training, coaching and guiding

Performance appraisal

Dealing with discipline and grievances

Recruitment and selection

Moreover Hutchinson and Purcell (2007) explored the critical role of line managers in key HR areas including reward, training, learning and development, and identified that line managers do not only implement and bring HR policies into life, but also play a significant role in influencing employee attitudes and experiences. A case study at Selfridges indicates evidence that line managers in the retail store helped improve employees’ attitudes and behaviours. This change in the line management role mainly focussed on improvements to people management behaviours and skill sets. (Hutchinson and Purcell, 2003)

However, a survey by Employment Review show HR practitioners disagree that line managers are applying these responsibilities effectively and training for line managers in people management should be compulsory. (Nadia Williams, 2008) In addition line managers agree with HR practitioners’ perception, as they struggle with the work overload and conflicting priorities to find time for people management activities. A research conducted by CIPD (2007) emphasise the extent of devolvement in the NHS, where ward managers effectively take responsibility for recruitment, selection, induction, appraisal and personal development plans, planning and delivering training, mentoring, communication, absence control and managing difficult people. The additional responsibilities are not welcomed by line managers who linked the lack of time and increased stress to the increased work load.

Despite the trend to devolve HR activities to line managers, Phil Brown, in ‘Why HR Must Empower the Line Manager’ (2008), believes that HR professionals are holding on to power and are unwilling to provide line managers with the tolls and information to perform HR duties effectively. Therefore CIPD stressed in their 2009 report that line managers need the following to fulfil their HR duties:

Time to attempt management roles

Carefully selected behaviour competencies

Support by strong organisational values

Sufficient people management skills training

Career opportunity linked to training and development

Involvement in decision making

But above all, line managers need self-confidence, a strong sense of job security and development in the organisation. Support by HR professionals is welcomed by line managers as they take more accountability of implementing HR people management activities. This allows HR professionals to fulfil their own potential in defining policies and strategies that are adequately aligned with business strategies.

Strategic HRM:

The nature of Human Resource Management has changed from being reactive, prescriptive and administrative to being proactive, descriptive and executive (Boxall, 1994). Moreover, Guest (1997) highlighted the contribution of HRM in improving an organisation’s performance and overall success while Katou and Budhwar (2007) outlined three perspectives for HR practices.

The ‘Universalistic’ practice assumes the best of HR practices and implies business strategies and HR policies are independent in determining business performance. The ‘Contingency’ practice implies a fit between business strategies and HR policies in determining business performance. The ‘Configurational’ practice implies an interaction between business strategies and HR policies based on an internal and external fit of the organisational context in determining business performance.

These perspectives highlight the growing contribution of HRM as an integral part of business strategy and success. Consequently, the term ‘Strategic human resource management’ evolved which Guest (1987) outlined to be largely concerned with integration of HRM into the business strategy and adaptation of HRM at all levels of the organisation.

In line with the emergence of SHRM, Budhwar and Sparrow (2002) proposed four generic HR strategies:

Talent acquisition

Resource allocation

Talent improvement

Cost reduction

Strategic HRM is based on the integration of HRM and business strategies for the effective management of human resources. Barney (1991) suggests that organisations achieve competitive advantage by creating unique HRM systems that cannot be imitated.

Recently, the pace of change in the global market has identified a significant number of contemporary issues emphasising the growing influence of strategic HRM and the importance of a human resources specialist to manage these challenges effectively.

Contemporary Issues in Strategic HRM:

HR professionals are struggling to catch up with the pace of transformation in global markets. Evidently, HRM faces an increasing challenge to use policies and strategies in the best interest of organisations and employees to maintain profitability and stability. The following are three basic examples of these challenges.

Globalisation:

The changes in international markets due to globalisation have a major effect on businesses in general and on how businesses manage human resources in particular. Although globalisation has many benefits, there are problems that have been attributed to the following factors:

Reduction in job security because work can be moved from one country to another.

Undercutting of one country’s wages by another, leading to erosion of wage rates.

Increased working hours and exposure to health and safety risks to cut costs.

HR professionals are struggling to ensure proper staffing and development with the required knowledge and skills for the changing business environment and according to Alan Price (2004), HR professionals are expected to be:

Role models displaying appropriate company behaviours and values

Fixers, adapting corporate values and mission statements to local circumstances

Networkers, making connections between local managers and other parts of the business

Coaches or mentors, transferring knowledge to local managers

A major task for HR professionals is putting significant effort in the training and development of line managers to implement the relevant HR policies which can consistently be applied across different locations and cultures.

Talent Management:

One of the main challenges for HRM is to attract, develop and retain talented individuals though a recruitment, selection and development process. Nestlé is a case in point as it uses a ‘talent puddles’ initiative to overcome the shortage of skilled applicants. The process consists of small puddles each containing potential talents for each function rather than the whole company. (CIPD report 2007) The strategy managed to reduce the time and cost for filling vacancies and selecting suitable candidates.

Other considerations include management of labour turnover and emphasizing employer branding in attracting the right candidates. Marks & Spencer, the major high street retailer, conducted an analysis to understand and redefine its employer brand to keep ahead of the competition. This analysis explored the factors that increase job satisfaction and highlight the factors that make working at M&S a unique experience. The analysis resulted in a better communication between the company and its employees that drove improvements across the business as well as increased levels of commitment and productivity. (CIPD report 2007)

HR professionals invest considerable effort into finding new trends to attract and retain the right talents; however, their role is surpasses ensuring a faultless selection process. HR critical responsibilities include initial job design planning, defining the required qualifications and conducting accurate selection methods to ensure compliance with litigations and to avoid any legal case for discrimination or sexual harassment. Therefore HR professionals need to have the skills and knowledge that are required to handle these tasks effectively.

Managing Diversity:

For over thirty years the emphasis and progress on equality and diversity has been ongoing but slow. Globalisation and demographic change is putting further pressure on organisations to develop and manage equal opportunity and diversity strategies to improve performance and promote competitive position. (Torrington and Hall 2009) Furthermore the CIPD defines diversity as: ‘valuing everyone as individuals – as employees, customers and clients’ so diversity is a broader term of equality which aims to improve the opportunities of disadvantaged groups within an approach inclusive of all employees rather than focusing on the disadvantaged as in equality approach. Some of the main diversity issues may include:

Age discrimination

Bullying and harassment

Disability

Equal pay

Race discrimination

Religious discrimination

Sex discrimination

A recent case of bullying and harassment concerned British Gas, whose workers have been balloted for strike action over alleged bullying at the company. The GMB union sent ballot papers to 8,000 members at British Gas to vote over claims of bullying and plans for job cuts. It said the management culture was undermining employees’ terms and conditions. (PM online, 11/03/2010)

It is worth noting that managing diversity is not solely an HR job but there is a great emphasis on the line manager’s role in promoting and achieving diversity in a workplace as well as handling conflicts before developing and becoming harder to resolve.

Conclusion:

Human resource management has evolved from the traditional personnel perspective and continues to evolve due to rapid change in the global business environment: in customer trends, competitors’ strategies and advancing technologies. Indeed factors such as globalisation, credit crunch and creation of multinational corporations have resulted in increased pressure to maintain the competitive edge while reducing operative costs.

Clearly the daily HRM activities have become integrated in line operations; however, an investment is needed in time and effort to up skill managers to fulfil their HR responsibilities properly. HR needs to provide and integrate well designed policies and strategies in frameworks and systems to enable line managers to perform effectively.

Despite an obvious trend to devolve more human resource activities into line management, clearly many of the new challenges require special skills and knowledge that line managers may not generally have. Therefore HR specialists and line managers must collaborate to achieve the business objectives within a frame of legislation and compliance. Hence the role of an HR specialist is moving towards a strategic partnership aligned with the business strategies while coordinating, advising and supporting line managers in performing the HR activities required.

Obviously, line managers have a responsibility towards their staff, given the close relationship and direct daily connection and interaction. Line managers are expected to implement and deliver the policies and strategies that are devised by HR specialists. There are many areas of HRM like talent management where line managers need more responsibility to manage activities, such as attracting, retaining, developing and motivating. Moreover, line managers must have authority and responsibility to control and reward the staff which in turn will improve their people management and leadership skills.

Finally it is evident that there is a correlation between HR professionals and line managers in certain HR activities that require further development. The report focussed on line managers as a front line management role, though HR knowledge and skills should be a requirement for middle management. Managers need be given adequate training and sufficient time to take on HR activities; these requirements should be included in HR strategies to achieve a high performance workforce objective.