This action might not be possible to undo. Are you sure you want to continue?
unemployment rates. The prevalent layoffs, retrenchments by corporate managers make them stand against workers desperately seeking job security. But in the midst of the recession, still there are some long-term aspects propelling the war of talent acquisition and enhancing the search for human capital like globalization, the aging population in developed countries and associated demographic shifts, technological developments, scarcity of skilled human resource etc. This paper endeavors to highlight the issue of Human Resource Management (HRM) practices during such recessionary times. It tries to project Human Resource Development (HRD) efforts as a long term investment made towards building human capital which in turn bring organizational efficiency so that the organization itself becomes more effective to stand against any adversity, like that of an economic downturn. The paper will resort to various studies already made and research done on this aspect, to come out with the logical conclusion. Introduction It is not the first time that the world has come across such an economic downturn. Ever since the Great Depression of the 1930’s, the
In the current economic downturn HRD is an investment that organizations need to foster and promote to ensure capacity building
global economy has come across such economic slowdowns almost every decade. Thus the recent economic downturn will also pave ways for steady growth. the reactive HR managers will just resort to short term cost cutting by way of layoffs. This paper takes up with various academic literatures. As a matter of fact. The paper will provide a comprehensive platform to correlated various research done in this area and In the current economic downturn HRD is an investment that organizations need to foster and promote to ensure capacity building 2 . The HR leaders foresee this opportunity and will use HRD as a long term investment to build the human capital. every recession is followed by period of rapid growth and development. This paper will aim to come out with a logical conclusion on this aspect. following the similar trend. On the contrary. The visionary leaders understand the need of the hour and are aware of the appropriate time to invest further in HRD so as to equip the human resource to take up the challenges put forward by the current economic crisis and to enhance the efficiency of the workforce so that the growth phase which is to follow may be appropriately exploited in the favor of the organization in general and workforce in particular. being cyclic in nature. case studies and practitioner literature to comprehend the matter relating to HRD and its use as an investment too for building capacity. Now here comes the demarcation between a visionary and proactive leaders and a reactive and complaint manager.
2005).will also try to highlight the areas associated with this topic. Though. where efforts are needed to come out with academic research. This transition is evolving HRM from the existing and old model which was relying mostly on the administrative processes to a new paradigm which is focusing on the strategic attributes of HRD (Armstrong. it can be through appropriate training and development. it can be through logical succession planning and may more. Investments in HR are unlikely to be prime concern for an organization whose survival itself is vulnerable as on outcome of the In the current economic downturn HRD is an investment that organizations need to foster and promote to ensure capacity building 3 . to have capability to steer through a complex global HR market so that they can engage the employees as an asset to the company. the investment can vary as per the size of the organization but the efforts are dependent on its execution methodology and company’s existing financial state of affairs. Review of the literature The human resource management is going through a phase of transition. These assets when nurtured like a long term investment will provide appropriate return on maturity (Wright. This new model of HRM requires the working HR managers who are aware of the importance of the human capital for various corporate strategies. It can be through intelligent selection and recruitment processes. The said investment can be made through various ways which are exhibited by HRM methodologies. 2005).
Researchers have further inferred that investment in human resource yields strategic advantage to the companys (Bitner & Zeithmal. 2007). This dynamic economic environment necessitates that the company in concern should keep investing in employee skills so that In the current economic downturn HRD is an investment that organizations need to foster and promote to ensure capacity building 4 . 2007). commitment and building high-performing teams. Especially those made during the recessionary phase. But for organizations which are deep pocketed and have strong financials to sustain the blow of any such recession. Studies have revealed that the expenditures made by any organization on its employee and workforce training returns huge benefits (Blair & Sisakhti. This in turn helps the organization to increase its operational output through long term employee retention (Blair & Sisakhti. Investing in employees and the workforce during any economic downturn has the added benefit of improving staff loyalty. Dynamic economic environment and changing customer base needs special approach and procedures and latest skills to equip the company with a competitive differentiator. 2001). Such initiatives not only address their concern for job security but also boost organizational loyalty. 2007). the downturn actually put forwards a very significant prospect to empower their human capital through capacity building which will prepare it for the eminent economic recovery (Harcourt & Wood. 2007). when the employees are very insecure about retaining the job (Harcourt & Wood.ongoing global downturn.
the limelight is taken up by a major factor which is relating to adequate liquidity level in the system.it can enhance its own ability to respond to such dynamic state of affairs (Jarventaus. Thus. acquiring new skills focused on future organizational need. There are many factors. 2007). Studies have shown that training and development efforts are one of the various possible solutions for addressing the problems caused by internal or external factors. be it public or private (Boselie. Dietz & Boon. grooming and developing human resource for capacity building becomes a panacea across the industry. Strategic focus on talent acquisition. Practitioners have given a lot of emphasis on training during any such recessionary phase (Jyothi & Venkatesh. training in hard and soft skills and enhancing effectiveness through various employee engagement programmes are vital for the organization to make a sound investment decisions. 2005). innovative ideas and trained workforce to bring the economy on track. However. In the current economic downturn HRD is an investment that organizations need to foster and promote to ensure capacity building 5 . it becomes eminent that every sector will be requiring skill sets. 2005). 2006). are responsible for the recent economic downturn. But as it is evident that the recession has hit all the sector without any prejudice. investment in training. some of which are not apparently known. faced by employees as well as the company (Summers & Hyman.
the organization is well positioned to tackle any such situation. it is important to safeguard the interest of the employees for the vested interest of the organization through investment in human capital. These are nothing but the lucrative return on the long term investments made by the organizations. The logic behind downsizing the employee base when the company or the economy is in financial distress and then again hiring new employees which will anyway be needing investment by way of induction. Any organization can leverage the learning curve of its workforce and also can be benefited by the valuable insights acquired by its employees over years of experience. which have withstood by the employees during such tough times. 2008).The proactive HR managers are well aware of the fact that during recessions or difficult financial situations. is not at all a proposition which can be considered cost effective (Ghebregiorgis & Karsten. Such experienced and loyal employees contribute immensely towards mitigating the risks arising out of In the current economic downturn HRD is an investment that organizations need to foster and promote to ensure capacity building 6 . so that when the upturn in the economy occurs. Some researchers have given a thought to the issue from entirely different perspective. 2007). The organization is in a better position to place right people at the right place as those people have been tested to hold against adversaries and have withstood the test of such recessionary conditions (Rizov & Croucher. training and development.
new challenges faced by the organization as they better poised to adapt quickly to such challenging business environment (Jarventaus. Based on the various studies and research papers. Implications It is essential to note that the research studies and academic research in this area are scarce. In the current economic downturn HRD is an investment that organizations need to foster and promote to ensure capacity building 7 . it appears that the studies taken up by the industry practitioners and the professional is yet to be matched to that by academicians. However. Thus it can be concluded that any company considers its experienced workforce as an assets and will keep on investing on it if it has adequate resources at its disposal. I can infer that in the economic downturn of the magnitude of the recent one. While this paper cannot profess to a comprehensive or exhaustive search. the day-to-day findings and hands on experience of practitioners provide a convincing learning insight. Most of the published and academic content associated with this issue is based on the subjective evidences and not on objective and vigorous findings. they start with the least experienced staff. 2007). it becomes inevitable for some companies not to do so as their very existence is questioned in such scenarios. though laying off the workforce may not be the best strategy for any organization. But even when the company resorts to downsizing.
Like self-assessment by any individual who lose its job is also equally important. the susceptible target. Another area which needs attention for further research is the role of Governments. Thus any organization should perceive the resources deployed towards HRM activities as long term investment rather than mere expense. Further. weaknesses and strengths are concerned will help them a lot to avoid getting into such situations in future.There are some areas of concern which needs attention from academicians and HR professionals so that adequate study can be taken up. interest. In the current economic downturn HRD is an investment that organizations need to foster and promote to ensure capacity building 8 . but a self assessment is definitely required to find for any deficiency which made him or her. Conclusion In the current context of the economic downturn. A worker might not be responsible for losing his or her job. The linkages between the administration and social partners need to be researched and emphasized upon. Introspection as far as the skills. which have the primary responsibility to avoid employee exploitation. this self assessment can also act as a factor which will motivate the worker to acquire new skills and knowledge. any organization should take effective and active human resource management initiative and should position itself strategically based on its employee strength not only in terms of numbers but also in terms of effectiveness and experience.
2005.. 4) Boselie. Any company needs to proactively follow a strategic approach towards HRD and make investment in such HR practices to gain sustainable competitive advantage both in tangible as well as intangible forms. “Sales training: what makes it work”? T+D Magazine. 2) Bitner. prove to be an asset to the organizations as they are now better placed to take up any such situation in future. 67–94. Dietz. References 1) Armstrong. J. New York: McGraw-Hill. Human Resource Management Journal. G. and Boon. The employees. 2005. A. 2007.Such situations are ideal for honing the skill sets and imparting training to the workforce as they themselves are very eager to take on with such situation through the help of the organization. M.. 3) Blair. R. “ Service Marketing”. available:www. C. V.astd. pp. M. In the current economic downturn HRD is an investment that organizations need to foster and promote to ensure capacity building 9 . and Zeithaml.htm. “Commonalities and contradictions in HRM and Performance research”. and Sisakhti.A. who gain valuable experience over the years. 15(3).org/astd/Publications/TD_Magazine/2007_pdf/August/0 708_ExecSum. Practice. 2004. August. New Delhi: Kogan Page India. D. J.. “Handbook of Human Resource Management”.
astd. 7) Jarventaus. 2005. 141–60. and Wood. pp. J. J. P. 2006. (2007).13(2). European Journal of Industrial Relations. International. New Delhi: Oxford University Press. 11) Wall. Human Relations. & Croucher. pp. 2007. 2005. and Venkatesh. T+D Magazine..D. Joseph Rowntree Foundation. available at: www. 8) Jyothi. 253–272.org/astd/Publications/TD_Magazine/2007_pdf/ March/0703_ ExecSum. In the current economic downturn HRD is an investment that organizations need to foster and promote to ensure capacity building 10 . G. 10) Summers.N. “The Romance of Human Resource Management and Business Performance. “Human Resource Management”... T. and Wood.York.J.321–332. L. 2008. M. “Human resource management and performance in a developing country: the case of Eritrea”. A review of literature”. 429–462. “Human resource management and performance in European firms”. “Employee Participation and Company Performance.htm. D. Training in a risky industry. S. Journal of Human Resource Management 18:2 February. J & Hyman.5) Ghebregiorgis. Cambridge Journal of Economics 2009. March. 58(4). 33. 9) Rizov. 2007. “The importance of employment protection for skill development in coordinated market economies”. United Kingdom. and Karsten. 6) Harcourt. M. and the Case of Big Science”. R. F.
. T. Moynihan. In the current economic downturn HRD is an investment that organizations need to foster and promote to ensure capacity building 11 . “The Relationship between HR Practices and Firm Performance: Examining Causal Order”.M.M.12) Wright. M.R. 409–47. 58(2). and Allen.M. 2005. P.. L. Personnel Psychology. Gardner. pp.
This action might not be possible to undo. Are you sure you want to continue?
We've moved you to where you read on your other device.
Get the full title to continue listening from where you left off, or restart the preview.