The fundamental principles that determine the progress of an organization are sound decision making, the kind of leadership, employee motivation, working environment, quality and quantity of work done, and most important is strategic human resource management. Instances where an organization is on its way to the bottom, as compared to its initial state, may be caused by several factors, some of which include negligence of duties by employees, demoralization, economic recession, corruption, lack of transparency and the most common being poor management. In such a case, the management should go back to the drawing board and determine the measures to undertake in order to streamline the organization. From the past experiences, it is evident that this organization has been experiencing a weak influence and low priority of the Human Resource Management. With regard to this, it is important to analyze the labor force of the organization. It has been found that the employees of this particular company are demoralized basing on the fact that they reflect s poor performance while carrying out their tasks. The major cause of this issue has been determined to be discrimination and projected inequality towards female employees. The other issue that has been raised has been overworking of employees and as a result of this, some of them have displayed possibilities of unmanaged emotions and burnout. Apart from that, it has been observed that most of the employees in specific departments lack some important skills to carry out their duties.
The organization can therefore recognize the importance of its employment policies such as the need for a stable workforce that will reduce the costs of labor, the need for worker cooperation in production by encouraging workers to exercise responsible autonomy at work, and internalization of policies like a guarantee of long term employment and paying the employees higher than the market rate or offering fringe benefits. Thus the major social forces responsible for shaping the nature and extent of people’s engagement with paid employment are job security, evidence of equality in the workplace, rewards, satisfaction and the benefits associated with the job.
Therefore, this essay will analyze the need for a Human Resource Strategy in a company facing a weak influence of the Human Resource Manager. It will analyze the relationship between strategic management and strategic Human Resource Management, examine the link between organization strategy and human resource strategy, consider the links between strategic human resource management and organizational performance. The analysis will achieve this by clearly demonstrating reliable academic theories for a clear understanding of points raised.
Strategic management and strategic human resource management
There exists a relationship between Human resource strategy and strategic management. By definition, according to Needle (2004), strategic management is the assessment of a company’s strengths and weaknesses and the company’s response to such opportunities and threats while human resource strategy is formulating and executing Human Resource policies and practices in order to produce competent employees who can help the company achieve its strategic goals (Dessler, 2009). There are many approaches to strategic management some of which include the rational classical approach, evolutionary approach, creative approach, behavioral approach and systemic approach.
Approaches to strategic management
The evolutionary approach involves the formulation of strategy through an evolutionary process where managers depend on the market to ensure maximum profits; meaning, the market, instead of the managers, will choose the prevailing strategies. This case will need a careful and thorough examination of the market in order to come up with decisions. For instance, the market will determine the need for a company to increase the output of a particular product when there is an increase in demand. The creative approach, on the other hand, states that as the environment of the workplace becomes complex and more problems arise, then the managers are forced to be creative. Here, the decision-makers are the force that drives the company towards achieving the set goals and objectives. In that regard, the managers should be in a position to think logically and with clarity since they are the drivers of the company. The behavioral approach bases strategy formulation on personalities and principles on senior management. The process of strategy formulation mostly takes place in meetings of collective bargaining agreements and trade unions. During such meetings, the rights of the labor force are determined while at the same time their working hours and the payment rates of both seasonal and permanent employees are stipulated. The worker’s unions that are formed are meant to represent and fight for the rights of the workers in times of complaints or inequality. The systemic approach states that strategy is influenced by the social environment surrounding it, for instance, culture. Finally, the rational approach states that strategy is determined after a process of formal and rational decision making while making an assumption that profit maximization is the only goal that drives the company while the competitiveness of the market is clearly elaborated. Strategies do emerge in organizations in order to improve performance and achieve the company’s goals. However, such approaches to strategic management may fail sometimes due to a number of factors.
For instance, this organization had an initial plan for strategizing itself towards achieving the set targets. To achieve this, it adopted the creative approach whereby the values of the decision-makers are upheld since they are the movers of the organization to giving it a competitive edge. This approach was chosen by the organization since it realized the importance of sound decision-making for it to make progress; while recognizing the importance of an ever-changing environment that will always encourage the creativity of decision-makers. However, this approach did not seem to be realized. The major reason for this failure is that the market is made up of organizations that seem to reason the same way. Whenever there is a demand for a commodity in the market, the organization decides to increase the output of the particular product. However, there are other organizations that also depend on the market to make decisions and they similarly increase their output. In the long run, there is the flooding of the commodity in the market and the demand drops again. Therefore, depending on the market to make important decisions seemed not to be reliable since the market is an independent stature and it faces turbulence and fluctuations. Another strategy should therefore be formulated.
The most probable reasons for the weak influence of Human Resource Management are poor leadership skills, discrimination of employees, overworking, lack of skilled labor and poor performance. The leader should acquire excellent communication and interpersonal skills especially during interaction with employees and should have the necessary management skills to run the organization. One more thing to note is that many women employees have complained about discrimination; in that, most men earn more than they do, thus they lack the urge to work more. This view has been supported by Taylor (2002) when he states that it has been a common occurrence in the Britain market; however successive governments have worked towards reducing these obstinate differentials that exist in earning between men and women. The theory on Human Resource – economic success relationship notes that the Human Resource system can impact the employee skills in such a way that employees can be motivated, made more productive, creative thus improving on the firm’s performance leading to profitability and growth (Wright & Haggerty 2005). It is interesting to note that all kinds of employment require some form of emotional management and cases where employees undergo discrimination or overworking should be addressed by the Human Resource department on how to eliminate them in the organization.
Introducing a Human Resource Strategy
There are a number of reasons why a Human Resource Strategy should be included in this company. Such a strategy will definitely solve the many challenges facing this company and at the same time work on the low priority and weak influence of the Human Resource Manager. In the real sense, a strategy that will take into account the standards of management and working environment should be incorporated in the company.
Internal strengths and weaknesses of the company
The Resource-Based Theory describes how people who run businesses establish their businesses based on their resources and what they have at the moment or those that they can acquire (Dollinger 1999). The use of the word “resources” was intended to mean the strength or weakness of a business or organization. This theory goes on to state that an organization can excel in its performance as compared to other organizations or businesses in the market if it is in a position to acquire and exploit the distinctive resources within the organization. A close study of organizations that excel will reveal that resources are the sole determinant for excelling. Examples of such resources include management skills, skilled personnel, strategic planning, and tacit knowledge (Polanyi 1962). According to these examples, it can be revealed that resources can qualify to be intangible and they can be tied up together with the tangible ones being finances, human and technological, forming either strengths or weaknesses thus leading to competitive advantage. Moreover, if the capabilities of a firm are in abundance, then it can be assured of profitability, rapid growth and survival. In this case, where the Human Resource Management seems to be weak, suggests that most likely, management skills resources are not effective or are yet to be exploited. This qualifies as a major weakness of the company, thus calling for a need for strategic human resource management. The strength of the organization is that employees, being a tangible resource, exhibit strong capabilities for performance; all they need is the motivation to be productive. With this in mind, the management and a Human Resource Strategy can ensure rapid growth and an improvement in performance if it invests in these capabilities, just as stated in the Resource-Based Theory.
The Human Resource Management Function
It can be seen that Human Resource Management has traditionally had a low priority and weak influence on the organization. First of all, it is crucial to appreciate the fact that management skills are a resource to the company, and it is one of the factors that will determine the overall performance of the company. It is equally important for managers in the Human Resource function to realize the economic consequence of their jobs. In other words, their jobs entail interacting with the tangible resources of the company such as the employees, motivating them, and ensuring that they are in a good position to work towards attaining excellent performance.
According to the Open Systems Theory, the surrounding environment easily influences the organization. The environment, in this case, refers to other organizations present in the market that provide economical and social challenges and gives providence to resources that will facilitate the sustainability of the organization thus bringing about change in the workforce (Talbert 2001). There is therefore the need for a Human Resource Strategy that will streamline the organization towards achieving its goals by keeping in mind how the surrounding environment influences the decisions made by the Human Resource function and how they pose economical and social challenges to this organization.
Research has shown that the more workers are motivated the more they produce and that an unmotivated employee is very to perform. It is important to note that Human Resource practices affect employee ability and motivation, which in turn affects the organization’s performance. Just like any human being, employees need to enjoy their work, they need to look forward to every morning of working instead of feeling worked up even before reporting to work. As this essay has addressed, the causes of demoralization of workers is has been caused by poor pay and a leader who does not seem to care about the issues that they raise. Another possible reason is that the company needs to consider introducing overtime payments to workers who work past their stipulated time. This is going to be a huge step towards uplifting the motivation of employees and in the long run, they will be encouraged to work more. In addition to that, incentives should be given to departments that perform well, while at the same time, the management should be able to recognize and appreciate the efforts of the hardest working employee.
The human capital theory stresses the effect of variation in the skills of employees will have on performance and has thus come to a conclusion that there exists a positive connection between the two variables (Whitley 1999). The theory dwells its applications on the abilities, skills and knowledge of human beings in organizations. In essence, the human resource strategy should include in its guidelines the improvement of employee skills in order for the organization to improve on its capabilities, therefore, leading to higher competitive advantage. The management of this particular company has to address the biggest issue facing the company; which is poor leadership skills. Any leader of an organization should strive to see the company he or she is running, grow to its maximum level and acquire profits to its best. A leader of a large organization who is fully aware of the grievances his employees are facing but decides to bury his head in the sand is not committed to seeing growth. Such a leader has lost insight and lacks goals and focus. The organization such a leader is running needs to be either streamlined or train the management.
Employee Training and Development
Training is all about imparting knowledge to employees on basic skills to be used while working. The main purpose of training is to make the workers more efficient in carrying out their duties. They can be trained on developing complex and simple skills such as first aid and what to do in case of a fire outbreak. These kinds of training will improve their work performance, work ethics and quality of work. The employees will also benefit from the training through increased earnings, and gain access to interesting jobs. The two approaches to training are voluntarist and educational wherein educational, it is assumed that it is in the interest of the company to have skilled labor and voluntarist assumes that in the case of market pressure, organizations will be sure to invest in training in order to have a ready team. This organization should be invested in training its employees since some have shown a lack of sufficient skills in technology. In the ever-changing world of technology, it is important to ensure that employees are at par with this kind of change. This way, they will be able to be productive in an effective way. The management can therefore monitor any progress by performing either a task or performance analysis. In addition, the attainment of soft skills such as communication and problem solving are important, for instance, to receptionists, in that they are able to complete tasks on time and therefore, improved performance. Therefore, one can say that human resource practices are the test of training and trained employees are able to be equipped with immense capabilities both for the good of their development and for the organization.
In conclusion, the direction of this company is determined by the attitude of its employees and the leadership skills of the management. The fact that the Human Resource Manager has less influence and low priority did not just happen. There were crucial reasons that led to this and that is why a Human Resource Strategy has to be developed in order to handle this challenge. By changing the environment of the company such as bringing in new recruits and new leaders who have different qualifications and experiences, difficult problems will most likely emerge, but in a positive way though. This will make the leader of this organization come up with more ideas in handling these problems, thus boosting his creativity. Motivating the workers, training them, recognizing their strengths listening and addressing their problems will make the company have more competent employees. This will in turn lead the company towards achieving its strategic goals and objectives. Therefore, the need for a Human Resource Strategy is crucial towards driving this company to explosive growth and stability.
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