gaining a competitive advantage-human resources perspective

7/30/2019 Gaining a Competitive Advantage-Human Resources Perspective

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Human Resource Management:

Gaining a Competitive Advantage

Chapter 01

Human Resource Management:

Gaining a Competitive Advantage

Copyri ght 2013 by The McGraw-H il l Companies, In c. All ri ghts reserved.McGraw-Hill/Irwin


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Learning Objectives

Discuss roles and activities of HRM function

Discuss implications of the economy, makeup of thelabor force and ethics for company sustainability

Discuss how HRM affects a balanced scorecard

Discuss what companies should do to compete inglobal marketplace

Identify how technology such as social networking isinfluencing HRM

Discuss HRM practices that support high-performance work systems

Provide a brief description of HRM practices

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Introduction

Competitivenessa companys ability to

maintain and gain market share.

Human resource management(HRM) thepolicies, practices, and systems that influence

employees behavior, attitudes and

performance.

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HRM Practices

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HR as a Business with 3 Product Lines

Business

Partner

Services

Strategic Partner

HumanResources

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6 HR Competencies

Credible

ActivistCultural

Steward

Business

Ally

Strategic

Architect

OperationalExecutor

Talent Manager/

Organizational

Designer

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Strategic Role of the HRM Function

Time spent on administrative tasks is decreasing.HR roles as a strategic business partner, change

agent and employee advocate are increasing.

HR is challenged to shift focus from currentoperations to future strategies and prepare non-HRmanagers to develop and implement HR practices.

This shift presents two challenges:

Self-service Outsourcing

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Shared Service Model

Shared Service Model is a way to organize

the HR function that includes centers of

expertise or excellence, service centersand business partners to help control costs

and improve business-relevance and

timeliness of HR practices.

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HR Playing a Strategic Role

in the Business?

1. What is HR doing to provide value-addedservices to internal clients?

2. What can HR add to the bottom line?

3. How are you measuring HR effectiveness?

4. How can we reinvest in employees?

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Questions, cont.

5. What HR strategy will get the business frompoint A to point B?

6. What makes an employee want to stay?

7. How will we invest in HR for a better HRdepartment than competitors have?

8. What should we be doing to improve our

marketplace position?

9. Whats the best change to prepare for thefuture?

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How is the HRM Function Changing?

As part of its strategic role, HR can engagein evidence-based HR.

Evidence-based HR demonstrating thatHR practices have a positive influence onthe companys bottom line or keystakeholders.

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The HRM Profession

HR salaries vary according to position,experience, education, training, location andfirm size.

The primary professional organization forHRM is the Society for Human ResourceManagement (SHRM) (www.shrm.org)

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http://www.shrm.org/http://www.shrm.org/


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3 Competitive Challenges

Influencing HRM

Sustainability

Technology

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The Sustainability Challenge

Sustainability is the ability of a company tosurvive and succeed in a dynamiccompetitive environment.

Stakeholders include shareholders, thecommunity, customers and all other partiesthat have an interest in seeing that the

company succeeds.

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Sustainability includes the ability to: deliver a return to shareholders provide high-quality products, services

and work experiences for employees

increase value placed on intangibleassets, human capital and socialresponsibility

adapt to changing characteristics andexpectationsof the labor force

address legal and ethical issues

effectively use new work arrangements

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Economy- Implications for HR

Structure of the economy

Development and speed of social media

Growth in professional and service occupations

Skill demands for jobs are changing

Knowledge is becoming more valuable

Intangible assets

Knowledge workers

Empowerment

Learning organization

Social collaboration and social networkingtechnology

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PsychologicalContract

AlternativeWork

Arrangements

Changes in

EmploymentExpectations

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Common Themes of Employee Engagement

Pride and satisfaction with employer and job

Opportunity to perform challenging work

Recognition and positive feedback from contributions

Personal support from manager

Effort above and beyond the minimum

Understanding link between ones job and companys mission

Prospects for future growth with the company

Intention to stay with the company

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Talent Management

Talent management is the systematic plannedstrategic effort by a company to use bundles of

HRM practices including acquiring and

assessing employees, learning and

development, performance management , and

compensation to attract, retain, develop, and

motivate highly skilled employees and

managers. Growth of contingent workers and part-time

employees

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The Balanced Scorecard

The balanced scorecard provides a viewof the company from the perspective of

internal and external customers, employees

and shareholders.

The balanced scorecard should be used

to:

Link HRM activities to the companys business

strategy.Evaluate the extent to which HR is helping meet

the companys strategic objectives.

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The Balanced Scorecard

How do customers see us?

What must we excel at?

Can we continuously improve and create

value?

How do we look to shareholders?

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Customer Service and Quality

Total Quality Management (TQM) Core Values Methods and processes are designed to meet

internal and external customers needs.

Every employee receives training in quality.

Promote cooperation with vendors, suppliers andcustomers.

Managers measure progress with feedback basedon data.

Quality is designed into a product or service so thaterrors are prevented rather than being detected andcorrected.

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Customer Service and Quality

Malcolm Baldrige National Quality Award

ISO 9000:2000

Six Sigma Process

Lean Thinking

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Changing DemographicsWorkforce Diversity

Internal labor force - current employees

External labor market - persons outside

the firm actively seeking employment

U.S. workforce is aging rapidly

Increased workforce diversity

Influence of immigration

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Managing a Diverse Workforce

To manage a diverse workforce, managers must developnew skills to:

Communicate, coach and develop employees from a

variety of cultural and educational backgrounds,

ethnicity, age, ability and race. Provide performance feedback based on objective

outcomes.

Create a work environment that makes it comfortable

for employees of all backgrounds to be creative andinnovative.

Recognize and respond to generational issues.

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Legal and Ethical Issues

5 legal areas that influenced HRM :1. Equal employment opportunity legislation2. Employee safety and health3. Employee pay and benefits4. Employee privacy5. Job security

Women and minorities still face the glass cei l ing

Sarbanes-Oxley Act of 2002

Federal health care legislation

Companies which employ unlawful immigrants or abuselaborers

Data-security practices and protecting intellectual property

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Legal and Ethical Issues

Ethics - the fundamental principles by which employees andcompanies interact

Ethical HR practices:

HRM practices must result in the greatest good for the

largest number of people Employment practices must respect basic human rights of

privacy, due process, consent, and free speech

Managers must treat employees and customers equitably

and fairly Managers must develop and distribute a Code of Ethics,

policies, processes and procedures, audit and train

employees

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4 Principles of Ethical Companies

1. Successful companies, in relationships withcustomers, vendors and clients, emphasize mutual

benefits.

2. Employees assume responsibility for the actions ofthe company.

3. Companies have a sense of purpose or vision theemployees value and use in their day-to-day work.

4. They emphasize fairness; another persons interestscount as much as their own.

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The Global Challenge

To survive companies must deal with theglobal economy, compete in and developglobal markets and prepare employees for

global assignments.Offshoring exporting jobs from developed

countries to less developed countries

Onshoring exporting jobs to rural parts ofthe United States

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Technology Challenge

The overall impact of the Internet

The Internet has created a new

business model e-commerce forconducting business transactions and

relationships electronically.

Social networking

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The Technology Challenge

Advances in technology have:changed how and where we work

resulted in high-performance worksystems

increased the use of teams to improvecustomer service and product quality

changed skill requirements

increased working partnerships

led to changes in company structure andreporting relationships

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The Technology Challenge

Advances in technology have increased: use and availability ofHuman Resource

Information Systems(HRIS)

use and availability ofe-HRM competitiveness in high-performance work

systems

HR Dashboard Metrics

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High-Performance Work Systems

Work in teams, virtual teams and partnerships

Changes in skill requirements

Changes in company structure and reporting

relationships

Increased use and availability of e-HRM and Human

Resource Information Systems (HRIS)

HRM practices support high-performance worksystems through staffing, work design, training,

compensation and performance management.

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Meeting 4 Competitive Challenges

Through HRM Practices

HRM practices that help companies deal withthe four competitive challenges can begrouped into four dimensions:

1. The HR environment2.Acquiring and preparing HR

3.Assessment and development of HR4. Compensating HR

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Meeting Competitive Challenges


Managing internal and external environmentalfactors allows employees to make the greatestpossible contribution to company productivity

and competitiveness.

Customer needs for new products or servicesinfluence the number and type of employeesbusinesses need to be successful.

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Meeting Competitive Challenges


Managers need to ensure that employeeshave the necessary skills to perform currentand future jobs.

Besides interesting work, pay and benefitsare the most important incentives thatcompanies can offer employees in exchangefor contributing to productivity, quality, and

customer service. Create pay systems, reward employee

contributions and provide benefits

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Summary

HR has three product lines: administrative services, business partnerservices, and strategic services.

To successfully manage HR, individuals need personal credibility,

business and technology knowledge, understanding of business

strategy, and ability to deliver HR services.

HR management practices should be evidence-based.

HR practices are important for helping companies deal with

sustainability, globalization, and technology challenges.

HR managers must address global and technology challenges.

gaining a competitive advantage-human resources perspective

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