Human Resource Strategies of Business Administrators

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Introduction

Business administrators continuously work on the improvement of human resource strategies since they are vital for the long-term sustainability of an enterprise. Their intention is to develop an HRM model that can improve the performance of companies and increase employees’ satisfaction with their work experiences. Various scholars argue that there is no universal or optimal approach to human resource management. In other words, it is not possible to identify a set of rules or procedures that can fit different types of enterprises. In their opinion, the choice of strategies depends on numerous factors such as business culture of a certain country, completive environment of a company, or the goals that this organization strives to achieve in the future (Harris, Brewster & Sparrow 2003, p. 56). This paper is aimed at examining this statement more closely. Overall, one can argue that it is difficult to identify a single approach that can fit different businesses because these organizations do not have the same objectives, customers, or activities. Nevertheless, there are certain pitfalls that HR professionals should avoid. Much attention should be paid to such risks as role ambiguity, inadequate distribution of rewards, or lack of appropriate orientation programs because they can undermine the competitive strength of an organization. They adversely affect both public and private institutions. These are the questions that should be examined more closely.

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Universalist perspective on management

It should be mentioned that many business administrators and scholars do not dismiss the universalist approach to management. In their view, there are certain methods of HRM that can be relevant to various organizations even though they may differ in terms of their size, structure, volume of production, or industry. In particular, one can identify the following elements of HRM: 1) performance appraisal systems that take into account individual contribution of employees; 2) clear design of jobs; 3) the use of elaborate recruitment methods that help to identify the most talented candidates, or 4) accessibility of top-level executives (Armstrong 2006, p. 135). Certainly, there are different models that summarize the best practices, but in many cases, they are similar to one another. According to the universalist perspective, these principles can be relevant to various type of business, even despite their distinctions. This is one of the main issues that can be identified.

Moreover, the universality approach to HR practices implies that there are certain common characteristics of well-performing companies. For example, it is possible to compare such corporations as Apple, Inc. and Google. These organizations are often regarded as role models for businesses that represent IT industry. Their strategies attract close attention of managerial scientists. To a great extent, they rely on the premise that the motivation of employees’ is critical for the sustainable performance. They pay attention to the following aspects: 1) empowerment of employees and their ability to take initiatives; 2) remuneration that reflects the individual performance; 3) close emphasis on retention of candidates; 4) the development of orientation programs that can help new hires to adjust the work environment; and 5) simplification of bureaucratic procedures (Muller 2011, p. 3; Sullivan 2003, p. 42). This comparison shows that there are certain methods that can benefit different businesses. On the whole, these corporations stress the importance of talent management since it is critical for their growth.

One can argue that the study of successful organizations can be helpful for the identification of the best practices in HR management. However, the critics of this approach can say that the success of businesses can be attributed to a wide range of external factors such as the level of competitiveness in the industry, demand for certain types of products, or the policies of a government. So, it is difficult to determine the extent to which HR practices contributed to the growth of an organization. Moreover, one should note that in the past there were companies that were regarded as role models for others. However, their collapse highlighted many of their drawbacks. The most eloquent example is Enron which was often praised for innovation and effective HR practices. This is one of the main limitations that should be considered. Apart from that, such corporations as Google or Apple represent an industry which is driven by innovation. They may not remain competitive if they fail to attract and retain the best professionals. However, one cannot say that their strategies will be always relevant to other businesses.

Yet, it is possible to provide other examples supporting the idea that there are some universal principles of HR management. In particular, there are empirical studies that are designed to examine the causes of increased employee turnover in various organizations. For instance, one can mention the research carried out by Choi Long et al. (2012). It suggests that there are several factors that are associated with high turnover rates. Among them, one can distinguish role ambiguity or the situation when a worker does not understand the requirements that managers set for him/her (Choi Long et al, 2012, p. 387). Furthermore, the performance of employees is more likely to decline, if they see that the rewards are unequally distributed (Choi Long et al, 2012, p. 387). This is why HR managers should focus on performance appraisal and compensation policies. Additionally, the turnover in organizations can decrease if there are well-developed orientation programs that should help a new hire adjust to requirements of the management. It should be noted that these trends can be observed in various types of organizations. In turn, by adopting some of the best practices described by scholars, business administrators can achieve better results. These are the main examples that used by the advocates of universalism in HR management.

The impossibility of the universal model in management

One should mention that there are several criticisms of the universalism approach to HR management. As it has been said before, the opponents of this theory believe that it is not possible to identify a single model that can fit different organizations since they do not always have many common characteristics. This argument can be backed by several examples. First of all, there are cross-cultural differences in the behavior of individuals and organizations. For instance, empowerment is of great importance in those cultures where people tend to place more emphasis on individualism and independent initiative (Kangas 2003, p. 257). In particular, one can mention such countries as the United States, Australia, or Germany (Kangas 2003, p. 257). Moreover, the organizations, which operate in these states, stress equality in the interactions between top-level managers and frontline personnel. The existing models describing the best HRM practices are usually designed for the needs of western companies (Boninelli & Meyer 2004). Yet, there are cultures in which people prefer collectivistic behavior (Kangas 2003, p. 257). As a rule, welfare of the group is of great priority to people who represent such cultures. Additionally, they are more willing to accept power distance between senior executives and employees. In this case, one should speak about such countries as China, South Korea, Singapore, or Taiwan (Kangas 2003, p. 257). These distinctions can be viewed as one of the reasons why many of the models developed in western countries were not very effective in Asia. For instance, many of the local employees did not try to distinguish themselves among other members of their teams (Hellriegel & Slocum 2009, p. 22). Apart from that, they usually required specific instructions from the management. This behavior can be explained by their strong aversion to risk and uncertainty (Hellriegel & Slocum 2009, p. 22). This is one of the reasons why HR models, which emphasize individuality and competitiveness in the workplace, proved to be inapplicable in many cases. The inconsistency of existing models with local cultures manifested itself when American or European companies began to operate in developing countries like China, India, or Taiwan. This is one of the details that should not be disregarded.

These examples are important because they suggest that HR managers cannot adopt HRM models without considering the business culture a country. Under such circumstances, the universalist approach to human resource management can create significant difficulties for business administrators. For instance, if they overstress the independent initiatives of workers and their autonomy, they can undermine the performance of a business because employees may not know what kind of objectives should be attained. Moreover, the majority of HRM models in western countries are based on the idea that the power distance between senior managers and frontline workers has to be reduced. In other words, these professionals are not supposed to emphasize the fact that they occupy different positions in the workplace hierarchy. Yet, this behavior is not acceptable for companies that operate in Asia (Kangas 2003, p. 257). Certainly, these distinctions can become less apparent in the future because the process of globalization contributed to the changes in the values and worldviews of people. Yet, at present, these differences should be considered by business administrators.

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Moreover, the critics of the universality approach can point out at the time of change, an organization can adopt HR policies and strategies that are not usually regarded as the best practices. As a rule, such businesses have to reduce their operational costs in order to remain sustainable. It is possible to mention such a corporation as General Electric, especially at the time when its CEO was Jack Welch who could be both praised and criticized. At the time, when he assumed this position, this corporation passed through a period of stagnation, and it was necessary to cut costs and boost the growth of General Electric (Brewster, Mayhofer & Morley 2004, p. 9). In particular, he eliminated the performance appraisal system which was previously established in the corporation. For instance, each year, the employees were divided into three categories according to their contribution to growth of a company, namely “ top 20 percent, the vital middle 70, and the bottom 10 per cent” (Welch as cited in Collings & Wood 2009, p. 189). Moreover, the bottom 10 percent of employees had to be terminated. Overall, the tenure of Jack Welch was marked by massive layoffs. Such a practice may not be accepted by modern managerial scientists who can say that this approach is too simplistic because it does not take into account the way in which employees supplement the work of one another (Collings & Wood 2009). In turn, massive layoffs increased the work stress among employees and even made them hostile to each another. Apart from that, there were significant discrepancies in the compensation offered to the employees who could be engaged in similar activities (Brewster, Mayhofer & Morley 2004, p. 9). Yet, this strategy enabled the corporation to become more competitive and attain sustainable growth. At present, Jack Welch is regarded as one of the most successful CEOs in the history of General Electric.

This example is important because it suggests that organizations have to respond to contingencies or specific challenges. In turn, their HRM strategies can evolve with time passing. At present, the senior executives of General Electric adopt a different performance appraisal method and avoid massive layoffs of workers. This is one of the details that should be taken into account. Nevertheless, the case of General Electric can also be used to support universalist approach to HR management. One should bear in mind that Jack Welch eliminated many of the internal inefficiencies, for example, excessive bureaucracy or autocratic decision-making style. Moreover, he introduced more elaborate performance evaluation techniques that enabled managers to better compensate high-performing employees. These initiatives are included in various models of the best HRM practices.

Discussion

The cases examined in this paper shows that businesses can adopt various approaches to the management of human resources. As it has been said before, they can modify their practices in order to implement changes or adjust to business environment. Nevertheless, there are several pitfalls that should be avoided. First of all, one should mention vague job expectations, inadequate performance appraisal method, or lack of communication between top-level executives and frontline personnel. Additionally, they should not underestimate the role of orientation programs that can be of great benefit to new employees. So, one can identify several deficiencies that contribute to increased turnover, absenteeism, or lack of motivation. If a company does not address these HRM problems, its performance can eventually decline. These are some of the details that business administrators should keep in mind.

Conclusion

Overall, the most optimal model of HR management has not been developed at present, even though researchers attempt to identify the principles that can be relevant to various businesses. The absence of such a model can be explained by the fact that organizations can differ significantly in terms of business culture, size, or competitive environment. This is why one cannot work out specific instructions that can be applicable to different businesses. However, there are several principles that can act as useful safeguards against possible risks. They should pay attention to compensation system, talent management, empowerment of workers, and their ability to adjust to the standards by their companies. Still, one cannot completely refute the argument that businesses may be forced to modify their HRM practices in effort to respond to new challenges.

References

Armstrong, M 2006, A Handbook of Human Resource Management Practice, Kogan Page Publishers, New York.

Boninelli, I & Meyer, T 2004. Building Human Capital: South African Perspectives, Knowres Pub, London.

Brewster, C, Mayhofer, W, & Morley, M 2004, Human Resource Management in Europe: Evidence of Convergence?, Routledge, London.

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Collings, D & Wood, G 2009, Human Resource Management: A Critical Approach, Routledge, New York.

Harris, H, Brewster, C, & Sparrow, P 2003, International Human Resource Management, Chartered Institute of Personnel and Development, New York.

Hellriegel, D & Slocum, J Organizational Behavior, Cengage Learning, New York.

Kangas, K 2003, Business Strategies for Information Technology Management, Idea Group Inc, London.

Long, C, Ajagbe, M, Nor, J, & Shahrin, E 2012, ‘The Approaches to Increase Employees’ Loyalty: A Review on Employees’ Turnover Models’, Australian Journal Of Basic & Applied Sciences, vol. 6, no. 10, pp. 282-291.

Muller, C 2011, Employee Motivation and Incentives at Apple, GRIN Verlag, Boston.

Sullivan, J 2007, ‘Google’, Workforce Management, vol. 86, no. 20, p. 42-43.

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