Human Resource Management (HRM) Assignment

Human Resource Management (HRM)

INTRODUCTION

What is HRM?

Human Resource Management (HRM) is the term used to describe formal systems devised for the management of people within an organization. The responsibilities of a human resource manager fall into three major areas: staffing, employee compensation and benefits, and defining/designing work.

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History

The roots of HRM go back as far as the 1950s, when writers like Drucker and McGregor stressed the need for visionary goal-directed leadership and management of business integration (Armstrong, 1987). This was succeeded by the ‘behavioural science movement’ in the 1960s, headed by Maslow, Argyris and Herzberg. These scholars emphasised the ‘value’ aspect of human resources (HR) in organisations and argued for a better quality of working life for workers. This formed the basis of the ‘organisational development movement’ initiated by Bennis in the 1970s. The ‘human resource accounting’ (HRA) theory developed by Flamholtz (1974) was an outcome of these sequential developments in the field of HRM and is considered to be the origin of HRM as a defined school of thought. HRA emphasised human resources as assets for any organisation. This ‘asset’ view began to gain support in the 1980s (Hendry and Pettigrew, 1990). The last twenty-five years or so have then witnessed rapid developments in the field of HRM, which are an outcome of a number of factors such as growing competition (mainly to US/UK firms by Japanese firms), slow economic growth in the Western developed nations, realisation about the prospects of HRM’s contribution towards firms’ performance, creation of HRM chairs in universities and HRM-specific positions in the industry, introduction of HRM into MBA curricula in the early 1980s, and a continuous emphasis on the involvement of HRM strategy in the business strategy.

The debate relating to the nature of HRM continues today although the focus of the debate has changed over time. It started by attempting to delineate the differences between ‘Personnel Management’ and ‘HRM’ (see e.g. Legge, 1989; Guest, 1991), and moved on to attempts to incorporate Industrial Relations into HRM (Torrington et al., 2005), examining the relationship of HRM strategies, integration of HRM into business strategies and devolvement of HRM to line managers (Lengnick-Hall and Lengnick-Hall, 1989; Brewster and Larson, 1992; Budhwar and Sparrow, 1997) and then the extent to which HRM can act as a key means to achieve competitive advantage in organisations (Barney, 1991). Most of these developments have taken place over the last couple of decades or so, and have precipitated changes in the nature of the HR function from being reactive, prescriptive  and administrative to being proactive, descriptive and executive (Boxall, 1994; Legge, 1995). At present then, the contribution of HRM in improving a firm’s performance and in the overall success of any organisation (alongside other factors) is being highlighted in the literature (see e.g. Guest, 1997; Schuler and Jackson, 2005; 2007). In relation to the last debate, three perspectives emerge from the existing literature: universalistic, contingency, and configurationally (Katou and Budhwar, 2006; 2007).

The ‘universalistic’ perspective posits the ‘best’ of HR practices, implying that business strategies and HRM policies are mutually independent in determining business performance. The ‘contingency’ perspective emphasizes the fit between business strategy and HRM policies and strategies, implying that business strategies are followed by HRM policies in determining business performance. The ‘configurationally’ perspective posits a simultaneous internal and external fit between a firm’s external environment, business strategy and HR strategy, implying that business strategies and HRM policies interact, according to organizational context in determining business performance.

Emergence of strategic human resource management (SHRM)

The above developments in the field of HRM highlight the contribution it can make towards business success and an emphasis on HRM to become an integral part of business strategy (Lengnick-Hall and Lengnick-Hall, 1988; Brewster and Larsen, 1992; Bamberger and Meshoulam, 2000; Schuler and Jackson, 2007). The emergence of the term ‘strategic human resource management’ (SHRM) is an outcome of such efforts. It is largely concerned with ‘integration’ of HRM into the business strategy and ‘adaptation’ of HRM at all levels of the organization (Guest, 1987; Schuler, 1992).

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Human Resource choices and Organizational Strategy

          HUMAN resource management is very sophisticated expertise and tools to handle humanity and get most appropriate outcomes from them. Their skills usability and hire them according to the caliber of the job requirement. Human resource management implementation need change application in an organization which gives birth to change in organizational strategies. Critical issues of human resource management are; definition of human resource objectives, developing effective strategies to serve the needs of different groups and coordination of planning with managers and other workers in the firm or organization (Desanctis, 1986). Organizational strategies are the back bone and standing stick for any organization. Human resource running require a newly breed environment and even it can stay in old system with its new features. Human resource practices are needed to change the lamented level of practices that are being implemented in organizations. The ideas and techniques should be defined

More clearly in this perspective (Dimick & Murray, 1978).

It is very complicated to change organizational strategies of any organization and especially in case of multinational firms the whole structure is not bound in a box. The operating of that box strategies are quite amazing and also very technical part. The handling of all those strategies is in hand of top management who holds it very tightly and implement on organization. Coff (1997) argued that Organizational strategies help mangers to improve the performance and attain competitive advantage which is sustainable some hidden strategies which followed in growing pattern of the organization are never to be exposed in front of the outsider world. Human resource management choices are change pattern as compared to the old fashioned strategically lay out of the organization. Its influence on practice has also not been as significant as could have been hoped (Lovas and Ghoshal, 2000).To implement the human resource application in your organization is just to add up new features in your products in marketing sense it is quite good but in our typical government structured organizations add up of new embraced technology or system is difficult.

Human resource management choices create a great edge to adopt new procedures and find out many human high tech arrangements. Human resource management can improve the capacity to understand organizational functionality (Dimick & Murray, 1978).

By introducing this bargain of the human resource taxonomy and placement through a complete operation every single aspect become so enhance to get rid of many problems. It includes from the recruitment process to training and development of the human groups. .

Farjoun (1994) argued that human resource management helps the organizations to diversify and get the commutative advantage by sharing the useful information with the own firms, joint ventures and acquisitions.

HRM is important to firms' financial and operational performance and the relationship between strategic HRM and firm performance has only recently been confirmed (Law, Tse, Zhou, 2003).

I am conducting this research to see the relationship between human resource management choices and

Organizational strategies. The most interesting aspect of my research is the application of this relationship on the multinational company of Pakistan. As per my findings multinational organization have maximum layout behind its existence and with the time passage strategies need to be change with the advance technology requirement. The great example is the Holy Family Hospital in city Rawalpindi Pakistan which is obtainable from last 40 years and they adopt new era specs along with its consistent environment. The history of this hospital tells the great change pattern with its strict policy manual.

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Literature Review ON HUMAN RESOURCE MANAGEMENT

3.1 Introduction

It will describe the knowledge acquired from literature reviews to the scope of research. These reviews includes what is human resource, human resource management, human resource functions and advantages, human resource management choices and Organizational Strategy.

3.2.1 Human Resource Definition Long-term Human Resource

(HR) planning is a strategic and very important part in a process of preparation and realization of such a complex organizational system also for the sake of cost reduction. Many organizations describe HR as the combination of traditionally administrative personnel functions with performance management, employee relations and resource planning. HR has at least two meanings depending on context. The more common practice within corporations and businesses refers to the individuals within the firm and some organization that deals with hiring, firing, training and other personnel issues.

The main objective of HR is to maximize the return of investment from organization’s human capital and minimize financial risk. HR manager is the responsible person to conduct these activities in an effective, legal, fair and consistent manner. 13 In economics, HR in the beginning was known as 'human capital’. From Wikipedia, human capital refers to the stock of productive skills and technical knowledge embodied in labor. Then it was later realized that humans are capitals which can be run through a particular time in fact they are social beings and things change day to day for them. The socialist parties have played a role of working the human rights. They explained that humans themselves are not assets for a company but the work they produce are the asset for them. And that they should be treated on the basis of their potentials and hard work. This act of their started the hiring and firing in a better manner. This argument of 'human capital' and 'HR' began until the United Nations recognized the same and supported the developing countries for this view. Today's organizations are continuously changing. Organizational change impacts not only the business but also its employees. In order to maximize organizational effectiveness, human potential individuals' capabilities, time, and talents must be managed. Human resource management works to ensure that employees are able to meet the organization's goals. In an organization with high HR value, employees are considered to be a source of competitive advantage and this will be reflected in the organization’s strategy, mission statement and operating practices. Valuing human resources will enable the organization to take advantage of the benefits of diversity brought by internationalization (Welbourne and Cieri, 2001).

 3.2.2 What is Human Resource Management (HRM)? And why HRM is important in human resource field?

HRM is a demanding and ongoing process. HRM is responsible for how people are treated in organizations. It is responsible for bringing people into the organization, 14 helping them perform their work, compensating them for their labors, and solving problems that arise. There are several roles that can be played by HRM.

·         HRM should help the organization articulate the purpose of the knowledge management system. For example, organizations embrace technologies to solve problems before they’ve even identified the problem they are trying to solve. Then, once they realize the error, they find it difficult to discard the original solution and difficult to gather the resources needed to invest in a solution to the real problem.

·         HRM must ensure alignment among an organization’s mission, statement of moral principles and policies.

·         HRM should create the “ultimate employee experience” by transforming tacit knowledge into explicit knowledge, build employee skills, competencies and creating bench strength.

·         HRM can assimilate effective knowledge sharing and usage into everyday life.

·         HRM must controls and allow behaviors that in the clockwork world of industrial efficiency, never would have been tolerated.

·         HRM must take a strategic approach to helping firms manage everything regarding the uses of technology. So that the technology will be fully utilize for the right purposes by the employees.

·         HRM must champion the low-tech solutions to knowledge management. Although it should not ignore the high-tech knowledge management tools, HRM contains the expertise to develop low-tech knowledge management strategies. However, HRM system is a solution to business problems that including positive 15 and negative complementarities rather than individual HRM practices in isolation.

 Moreover, through all facets of HRM functions, how can the motivation, commitment and other organizational relevant favorable attributes of employees are ensured in the interests of optimal organizational performance?

 Such driving forces were important in helping transform ‘personnel management’ into HRM, and more recently, HRM into ‘strategic human resource management’ (SHRM), providing recognition that the effective management of human resources is a strategic function not a service or support activity in organizations.

Encyclopedia of Business and Finance has stated that HRM has seven key functionalities.

Seven Key Responsibilities of HRM

1.      Staffing

2.      Performance appraisals

3.      Compensation and benefits

4.      Training and development

5.      Employee and labor relations

6.      Safety and health

7.       Human resource research.

3.3 Advantages of Human Resource (HR)

It is an essential part of any organization, doesn’t matter either the organization is big or small. Great pressure is laid on implementing an effective HR system in an organization. Driving HR efficiently can contribute more value to the business.

·         Efficient HR can make overall costs for HR reduce, improve efficiency of HR administration, reduce manual processing, improve consistency and compliance, make fixed costs variable and reduce capital investments in HR

·         HR in an organization is the assistance it provides in recruiting staff and in training employee.

·         HR system implements series of strategies in employment appointing which includes allocated training sessions for employee develop test plans for employee, to manage and analyze employee interviews and to create internship opportunities. iii. HR provides consultancy.

·         HR is a medium which provide all the consulting that an employee needs and also answer general queries.

·         HR is very effective in an organization to settle down any managerial disagreement or employee problem in a professional and proficient manner.

·          On more advantage of HR is that these departments actively participate in business and marketing decision. The HR system comprises of highly dedicated professionals who have the ability to develop new plan and implement marketing strategies that would bring more business and capital to the organization.

·         HR also deals with the long-term management of the business.

·         HR helps the business and commerce to make public relations and built a proper referral system. It is very necessary that the business develops an association with other businesses in the market so it could propel its earning through collaboration with other business sectors.

Human Resource management Choices

Human resource management is the art of finding the resource person according to the requirement of the job categorization. The labor-intensive of this art starts from the pre-recruitment process to the training and development of the employee. Many sequential steps are also included in this process of human resource development.

 Human resource practices are useful to improve the level of organizational functioning, they create a fit between organizational level and international level subordinates, it also improves the level of organizational analysis. Human resource management functionality divides the burden of the whole organization and they maintain the equipping usability’s of the organizational employee. It draws a channel between the each department of the organization and look like a radar graph if we draw it on a table. Sometimes it acts like a central point of all departments and have interaction with all other departments. Snell (1992) found that strategic human resource management requires an interdisciplinary research, unfortunately the majority of work is conceptual and it this approach is so strong that it is almost irresistible.

The irresistible practicality of this department plays a vital role in organizational benefits to acquire the services of the employees and even to hire them with their esteem skills. Projection of this human resource department is to seek the highly motivated persons who want to devote themselves. The strategic role of HRM in a firm has been shown to affect a firm's productivity, and employee attitudes towards TOP have been shown to affect a firm's profitability. he socialization and development of the devoted employees along with incentives packages for them. In government organization trend change to enhance their focal points and brings productivity increment with advance features.

 Snell (1992) found that at their root, the distinctions between strategy control and human resource management are becoming less obvious.

 When we try to build a new department in any organization or when we construct a new fancy room in an old house we need to plunge the old structure and add new mapping views which can be new strategies.

Human resource management should set- up ways in dealing with the emerging challenges because the functions and activities in the 21st century are to maintain the competitive advantages. Globalization of the markets, changing customer demands and increasing product-market competition, people and the way they are managed acquire greater importance and require a plan for Globalized human resource management. A Team should be well equipped with the basic tools and the techniques/technologies. They should be able to develop a knowledge base for the major components and should know the difference between the Personal Management and the strategies of Human Resource Management.

ORGANIZATIONAL STRATEGY

Organizational strategy is the study and application of knowledge about how organizational people, individuals, and groups should act in organizations according to the rules. The strategies are organizational statuary body and regulations of the whole organization which is stiff. The practical approach which includes the written clauses along with the factual things traditionally followed by the employees is the major blocks of the organizational strategy.

Organizational strategy is the building block of every organization which is consists of embossed words of wisdom and path. Performance, individual satisfaction, and personal growth and development of an Employee are important elements which can combine to build the model or framework that the organizations function from. And that mainly depends on the management's philosophy, values, vision and goals. Organizational strategy which is the spinal cord of the any organization as focus of this research paper is on multinational company. This strong intimated back bone is holding firmly the whole organization.

Multi-national1 organizations are very much bound in their strategically framework that’s why they are growing and also they are stable from last many years. In Pakistan multi-national organizations have their rules and regulations which are written clearly. These acts upon regulations are able to take in challenge even in court if there would any disturbance handling happen to these regulations.

The deviant response of the human resource management is aggressively imposed its impression on the whole organization.

The big flaw of some big organization is that they possess some relational hiring which are sometimes due to the favoritism and approach. During the data collection for this research paper finding some new hidden things that in few big organizations the employees qualification is below graduation which show that people who join these organizations they serve these organizations just for the sake of their job security. These people hesitate to switch on their jobs until and unless they got fired from these organizations. Old employees need to be trained for the new technology and they need to adopt new frequent changes entered in the environment. In big organizations the training and development chances are equally given and even employees are promoted on this training basis.