THE CHALLENGES IN

HUMAN RESOURCES
MANAGEMENT

Prateek Goel

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HUMAN RESOURCES
MANAGEMENT
Human Resources Management
(HRM)
The process of managing human
resources (human capital and
intellectual assets) to achieve an
organization’s objectives.

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NEED FOR HRM
Staffing the organization
Designing jobs and teams
Developing skillful employees
Identifying approaches for
improving their performance
Rewarding employee success

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Challenges and Human
Resources Management
The most pressing competitive
issues facing firms:
1. Going global
2. Embracing new technology
3. Managing change
4. Managing talent, or human capital
5. Responding to the market
6. Containing costs

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CHALLENGE 1: GOING
GLOBAL

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Challenge 1: Going Global
Globalization
◦ The trend toward opening up foreign
markets to international trade and
investment
Impact of globalization
◦ “Anything, anywhere, anytime”
markets
◦ Partnerships with foreign firms
◦ Lower trade and tariff barriers
NAFTA, EU, APEC trade agreements
WTO and GATT
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Challenge 1: Going Global
(cont’d)
Outsourcing work
Corporate Social Responsibility
◦ The responsibility of the firm to act in
the best interests of the people and
communities affected by its activities

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Challenge 1: Going Global
(cont’d)
Impact on HRM
◦ Issues:
Identifying capable managers and workers
Developing foreign culture and work
practice training programs.
Adjusting compensation plans for overseas
work

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 Challenge 1: Going Global
(cont’d)
Workforce diversity
◦ Different geographies, cultures, laws,
and business practices

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Challenge 2: Embracing New
Technology

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Challenge 2: Embracing New
Technology
Knowledge Workers
Knowledge-Based Training
Online instruction
“Just-in-time” learning via the Internet
on company intranets
Influence of Technology in
HRM
Human Resources Information
System (HRIS)
◦ Benefits:
Store data.
reconfigure data
organizational knowledge.
Easier communications.
administrative costs

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Most Common HR
Information Systems
Applications
 Payroll
 Benefits administration
 Benefits enrollment
 Recruiting—applicant tracking

 Personnel administration
 Training and development
 Employee self-service
 Manager self-service
HRM IT Investment Factors
 Ability to upgrade  Time required to
implement and train
 Compatibility
staff members to use
with
HRIS
current systems

 Initial
and annual
 Availabilityof
maintenance costs
technical support

 Trainingtime
required for HR and
payroll

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Coping up with IT
EfficientIT Department
Proper training
Upgrading OAS
Tracking new developments

Copyright © 2007 Thomson South-

Western. All rights reserved. 1–15
Challenge 3: Managing
Change

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Challenge 3: Managing
Change
Mergers and acquisition
Diversification of an organization
Organization design
Changes in strategy
Change in management team

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Reactive response
Response that occurs after external
forces have already affected the
performance.

Proactive response
Response initiated to take advantage
of targeted opportunities
Copyright © 2007 Thomson South-
Western. All rights reserved. 1–18
Challenge 3: Managing
Change (cont’d)
Why Change Efforts Fail:
◦ Not establishing a sense of urgency.
◦ Not creating a powerful coalition to
guide the effort.
◦ Lacking leaders who have a vision.
◦ Lacking leaders who communicate
the vision.
◦ Not removing obstacles to the new
vision.
◦ Declaring victory too soon.

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Challenge 4: Managing Talent,
or Human Capital

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Challenge 4: Managing Talent,
or Human Capital
Human Capital
◦ The knowledge, skills, and capabilities
of individuals that have economic
value to an organization.

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Challenge 4: Managing Talent,
or Human Capital(cont’d)
Importance of Human Capital or
Talent
◦ Based on company specific skills.
◦ Can be expanded through
development.
◦ There is a demonstrated relationship
between better talent and better
business performance.
◦ Talent is rapidly increasing the source
of value creation.
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Challenge 4: Managing Talent,
or Human Capital(cont’d)
Human Capital, if not retained
◦ High attrition rate.
◦ Loss of valuable human asset.
◦ Loss of secret information.

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Challenge 4: Managing Talent,
or Human Capital
Managing Human Talent through-
◦ Putting right people in right job.
◦ Employee Reward program.
◦ Career development program.
◦ Performance based bonus.
◦ Loyalty bonus.
◦ Giving voice to knowledge Bank.
◦ Employee recreation.
◦ Gifts at some occasion.
◦ Regular survey or feedback.
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Challenge 5: Responding to
the Market

MARKE
T
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Challenge 5: Responding to
the Market
Total Quality Management (TQM)
◦ set of principles
◦ understanding customer needs
◦ doing things right
◦ continuous improvement.
Six Sigma

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Challenge 5: Responding to
the Market (cont’d)
Reengineering and HRM
Requires that managers create an
environment for change.
Depends on effective leadership and
communication processes.
Requires that administrative systems be
reviewed and modified.

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Challenge 6: Containing
Costs
Challenge 6: Containing
Costs
Downsizing
◦ The planned elimination of jobs
(“head count”).
◦ Layoffs
Outsourcing
◦ Contracting outside the organization
to have work done that formerly was
done by internal employees.

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Challenge 6: Containing Costs
(cont’d)
Employee Leasing
◦ The process of dismissing employees
who are then hired by a leasing
company

Off shoring
◦ The business practice of sending jobs
to other countries.

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Challenge 6: Containing Costs
(cont’d)
Hidden Costs of Layoff
◦ Severance and rehiring costs
◦ Accrued vacation and sick day
payouts
◦ Pension and benefit payoffs
◦ Potential lawsuits from aggrieved
workers
◦ Loss of institutional memory and trust
in management
◦ Lack of staffers when the economy
rebounds
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THANK YOU

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