Essay on "People Management and Human Resource"

Essay 10 pages (2984 words) Sources: 10

[EXCERPT] . . . .

People Management and Human Resource Management

The human resource of the modern day society is no longer just the force operating the machines, but they represent the creative force behind organizational ideas and plans. The employees bring more value to the firm as they possess intellectual capital. Today, the staff members are the most important organizational asset (LaDou, 2004, p. 636).

In this context then and given the importance of the staff members, organizational leaders recognize the need to develop and implement more comprehensive human resource strategies. And these strategies are devised to serve a multitude of purposes and manage the relationship between the employer and the employee before the actual employment contract is signed and after it is canceled. Human resource strategies for instance focus on recruiting, hiring and retaining the best skilled employees; they also strive to motivate the employees and enhance their performances. Overall, the general scope of strategic human resource management is that of aligning the individual goals of the employee with the overall goals of the entity in order to ensure that the organizational objectives are best attained (Salaman, Storey and Billsberry, 2005, p. 328).

The field of strategic human resource management has exponentially increased throughout the past recent years as more and more academicians and practitioners are interested in the mechanisms of managing the people. The current project sets out to extract some of the more notable ideas in the specialized literature. As this stage is completed, emphasis is being placed on the application of the human resource strategies at international sports apparel manufacturer Nike Inc. In the context of Nike, focus is placed on four specific dimensions of human resource management: standardization of human resource practices, differences in approaches, global application of practices, and last, strategic advantages of HRM measures.

2. Literature review

The concept of strategic human resource management has been approached by numerous researchers, yet the academic community has yet to come to a universally accepted definition of the concept. Some of the more notable definitions of strategic human resource management include the following:

"Strategic HRM is an approach that defines how the organization's goals will be achieved through people by means of HR strategies and integrated HR policies and practices" (Armstrong, 2008, p. 34).

"Strategic HRM provides the all-important framework for applying people management practices to achieve business outcomes. It is concerned with the intentions of the organization on the overall direction it wishes to take in order to achieve its objectives through people" (Armstrong and Baron, 2002, p.xv).

"Strategic human resource management can be defined as the linking of human resources with strategic goals and objectives in order to improve business performance and develop organizational culture that foster innovation, flexibility and competitive advantage. In an organisation SHRM means accepting and involving the HR function as a strategic partner in the formulation and implementation of the company's strategies through HR activities such as recruiting, selecting, training and rewarding personnel" (Sinha, 2007).

In essence then, the concept of strategic human resource management could be understood as an effort of integrating the management of the employees in a manner in which the organizational goals of the employer are best met (Durai, p.24). Strategic human resource management draws heavily on the parent discipline of human resource management, but it also reveals the difference in the fact that it relies heavily on the strategic side of HRM implementation. In this order of ideas, Mike Millmore identified four specific principles of strategic human resource management, as follows:

1. The emphasis on integrating the personnel policies in order to create a coherent package, and the integration of the employee policies with the general business planning

2. The transfer of the human resource management responsibilities from specialist managers to senior line managers

3. The transition from a relationship between employer and trade union to a relationship between employer and employee; the replacement of collectivism with individualism. And last,

4. The emphasis on commitment and initiative, as the managers become enablers, empower-ers and facilitators (Millmore, 2007, p.41).

Strategic human resource management is essential to supporting the company attain its objectives. Nonetheless, in the context of the modern day dynamic marketplace, economic agents are faced with mounting pressures. And one of the most relevant examples in this sense is represented by globalization. In this sense, the features of the phenomenon are forcing economic agents to face more competition, to adapt to new marketplaces and to even further emphasize on efficient human resource management. With this objective in mind, the application of strategic human resource management by economic agents activating within the international arena is pivotal.

Multinational corporations are faced with a dual challenge when operating within the global environment. On the one hand, they have to align their human resource management practices with the organizational goals and its business principles so that it is best able to attain its objectives. On the other hand however, they have to align their human resource management practices to the specifics of the industry in which they operate. In order to best serve this dual purpose and create global competitive advantages, economic agents are required to pay increased attention to the following five critical issues:

The adaptation of the strategic human resource practices to the local differences

The exploitation of economies of scale

The exploitation of economies of global scope

The tapping of optimal locations for resources and activities, and last

The maximization of knowledge transfer throughout the organization (Schuler and Jackson, 2007, p.140).

Within the setting of human resource management practices applied within the global community, a new concept was devised -- the strategic global human resource management (SGHRM). This concept is rarely defined, but understood as the application of strategic human resources management within the completion of international business operations. And in the context of intensifying forces of globalization, the presence and role of strategic global human resource management is expected to continually enhance.

In this setting, Timothy Kiessling and Michael Harvey point out that the global community has generally based its human resources practices on the theoretical knowledge devised by the more economically developed western states. Nonetheless, these models were devised within the context of the western values, cultures and behaviors. Today, as the international business community becomes more integrated, the western application of business practices -- including strategic human resource management -- might no longer be suitable. The two authors as such propose a new method which combines both qualitative and quantitative methods of exploring the phenomenon of human resource management within the international community (Kiessling and Harvey, 2005).

All in all, strategic global human resource management reveals functions similar to traditional human resource management, with the specification that the complexities are generated by the differences in the local cultures, the industries in which the firms activate or the orientation of the manager towards strategic global human resource management. Rebecca Johnson (2009) argues that the key success factor is that of balancing integration with adaptation to the local features.

"The key issue for organizations is to effectively balance the needs for the whole organisation to be integrated and controlled as one, while simultaneously allowing the subsidiaries to differentiate themselves in order to adapt to the local environment" (Johnson, 2009, p.77).

3. The case of Nike Inc.

Nike Inc. is one of the largest corporations in the world. To consumers, it is known through the variety of high quality sports shoes and apparel, suitable for all age groups. To the economists, it is known through the successful business model it implemented. Nike's core effort has revolved around the offshoring of as many operations as possible. Within the United States as such, the company does not produce any apparel, as all products are manufactured in third world countries, where cost efficiencies are possible.

This situation has brought the company vast criticism and accusations included the stealing of jobs away from Americans or the propagation of poverty in the outsourcing countries through the offering of minimum wage salaries and the implementation of difficult working conditions in its sweatshops (Beach). Regardless of the public perception of Nike, fact remains that the company is an emblem of the successful American corporation.

3.1. Standardization of HR practices

The standardization of the human resource practices is a complex endeavor, generating a wide array of implications, some positive and some negative. According to Pawan S. Budhwar (2004), the more notable benefits of standardized human resource management include the following:

Standardized human resource practices might be perceived as equitable by the employees that the multinational corporation has in various regions

Standardized human resource practices might include similar selection criteria, similar training and compensation and would generate higher levels of collaboration across various plants

Standardized practices of human resource management allow the parent company to better control its global operations, and last

Standardized practices of human resource management allow the company to leverage HRM techniques which had already proven valuable throughout the multinational corporation.

Still, aside from the advantages, Budhwar also argues that there are some notable disadvantages to… READ MORE

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