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What are the challenges facing HRM? / Explain the changing role of HRM?
The 1990s have brought a revolutionary change in our business. Post- liberalisation ismarked by a shift from command economy to market driven economy; from shelteredmarket to competitive market; from monopoly to competition; and from domestic trade toglobal trade. Such a shift calls for a different approach to HR activities. During the pre-economic liberalization, the HR managers had aopted a reactive strategies to people’s problems. The need of the hour is proactive approach, a strategy which helps HR managers foresee events and take appropriate actions before the events occur.The major challenges are:
GlobalisationGlobalisation is increasingly viewed as a growth strategy by several companies. Growinginternalisation of business has its impact on HRM functions. The HR department isrequired to cope with the problems of unfamiliar laws, languages, practices,competitions, attitudes, management styles, work ethics and more. HR managers arerequired to know that international operations have:More functions, such as taxation and co-ordination of departments.More heterogenous functions, such as co-ordination of multiple salary currenciesMore involvement in the employee’s personal life, such as housing, health, education andrecreation.HR functions such as planning, staffing, remuneration and the like, therefore, will beaffected by globalisation.
Corporate ReorganisationsThe past three to four years brought us news about corporate mergers, takeovers andmassive reorganizations to fend off hostile take-over bids. It is difficult to imaginecircumstances that pose a greater challenge for HRM than reorganization resulting fromacquisition, merger, divestiture or a take-over threat.The reorganization will have impact on organizational levels and employees. Theemployees of both the ‘taking over’ as well as the ‘taken over’ companies will haveanxious moments because of 1.Fear of loss of jobs2.Job changes, including new roles and assignments3.Transfers to new geographic location4.Changes in remuneration5.Changes in career possibilities6.Changes in organisational power, status, an prestige,7.Staff changes, including new peers, supervisors, and subordinates, and8.Changes in corporate culture and loss of identity in the company.There is little indication that the pace of mergers and acquisitions will slacken in thefuture. But an important key to the success of almost any merger or acquisition is themanagement of HR.
 
 New organizatioanl formsThe practice of HRM is shaped by the organisational forms in which people areemployed. But the employment potential of these giant corporations is declining. Large production units have become increasingly a thing of the past, and large companies nowtend to consist of business units managed relatively independently.The consequence has been a higher profile of medium size and small sized firms asemployers. A majority of the population are employed in units with fewer than 200employees.This trend affects HRM in various waysSmaller firms and establishments means a more personalised style- not necessarily more progressive, but more fsce-to –face.Smaller units may require less complex and sophisticated systems of personnelmanagement, but may also be less able to sustain them in areas like managementdevelopment.Smaller unit are less able to sustain a specialist personnel management function.On the other hand, the business and human challenges of operating in this kind of environment are becoming greater. The contribution of HRM will then be in facilitatingthe processes, which support the development of the enterprise, rather than, as traditional personnel management has one, in administering systems for controlling people.The basic challenge to HRM an enterprise management comes from the changingcharacter of competition.Competition in many sectors is no longer between individualfirms, large or small, but between constellation of firms.
Changing demographics of workforceThe major challenge that has resulted from changing workforce demographics concernsdual career couples, couples where both partners are actively pursuing professionalcareers. Organizations have been accustomed to using job moves and physical relocationas an important means of developing talent. The increasing number of dual career  professionals limits individual flexibility in accepting such assignments.Another change in the workforce demographics relates to the growing number of employees who are young. Dormitories, gymnasium, breakfast, these are the kind of facilities that need to be provided to the workforce which has more of young employees.
Changed employee expectationsWith changes in work-force demographics, employee expectations and attitudes also haveshifted. Traditional allurements such as job security, attractive remuneration,housing andthe like do not attract and motivate today’s workforce. Employees demand empowermentand expect quality with the management. Previous notions about managerial authority aregiving way to employee influence and involvement along with mechanisms for upwardcommunication and due process.Another expectation by the employee is that the electronic and telecommunicationrevolution will improve the quality of work life. Innovations in communication andcomputer technology will accelerate the pace of change, and as a result, lead to manyinnovations in HRM. Also, today’s average worker demands better treatment, challenging jobs and career advancement.
 
The HR manager must, therefore, redraw the profile of the worker and discover newmethods of hiring, training, remunerating and motivating employees.
Proactive industrial relations strategyThere is almost a metamorphosis at the industrial relations front. Strikes, lockouts andloss of mandays are declining considerably. This transformation is the result of socio-economic and political reasons.The challenge to the labour movement comes not so much from any destructive potentialintrinsic in HRM but from its capacity to co-opt and integrate workers into the enterprise by building a relationship with them. Not having to compete with the management for worker’s loyalty, trade unions behavetowards their members exactly as any monopolistic organisation would. HRM comes as athreat to this cosy arrangement, for management is not only seeking to get back to theneglected employee, but doing so in an environment where there own unions had takenthem for granted.The need now is to adopt a proactive strategy towards industrial relations, an approachwhich should enable HR specialists to look into the challenges unfolding in the future andto be prepared to convert them into opportunities.
Contribution to the success of the OrganizationThe biggest challenge to an HR manager is to make all employees contribute to thesuccess of the organization in an ethical and socially responsible way. The society’s well being, to a large extent depends on its organisations, particularly business organisations.It must be the endeavour of everybody to ensure success and stability of organizations.Responsibility is more on the HR manager as it is he who co-ordinates people’s activitiesand it is the people who make or mar organizations.
 Need for attitudinal change in PSUsWhile success of organizations in general is vital for society’s well being, public sector undertakings tell a different story. It may be asserted that although most PSUs are strongin manpower, R&D, systems, manuals, principles, and procedures, they fail to use it andincur losses.Behind this phenomenon is the role of the personnel. Employees of loss making unitshave wrong attitudes towards their work and their organizations. Consequences are low productivity, absenteeism, militancy and other similar evils.These issues must be addressed by the HR manager.
Renewed focus on peopleThe good news for HR managers is that there is renewed focus on people inorganizations. For too long, managers believed in structures, strategies and systems. Butover the last decade, technological, competitive and market changes have eroded itseffectiveness.The top management must therefore nurture the ideas of the frontline engineers and salesrepresentatives, encourage interpersonal relationship and self monitoring and develop personal communications with key people.
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