Professional Documents
Culture Documents
Recent Trends in HRM
Recent Trends in HRM
INTRODUCTION2
New Trends in International HRM ..4
Human Resource Management in India6
Top 10 Human Resource Practices- Post Recession...9
Top 10 Trends in Employee Management..13
Top 10 Work Force Trends.............18
Demographics and changing nature of work..19
Future of Employment Relations............25
New Trend of Upgrading Talent.28
Changes in Technology...32
CONCLUSION...35
References...36
INTRODUCTION
The recent quality management standards ISO 9001 and ISO 9004 of 2000
focus more on people centric organizations. Organizations now need to
prepare themselves in order to address people centered issues with
commitment from the top management, with renewed thrust on HR issues,
more particularly on training.
With the increase of global job mobility, recruiting competent people is also
increasingly becoming difficult, especially in India. Therefore by creating an
enabling culture, organizations are also required to work out a retention
strategy for the existing skilled manpower.
India is being widely recognized as one of the most exciting emerging economics
in the world. Besides becoming a global hub of outsourcing, Indian firms are
spreading their wings globally through mergers and acquisitions. During the first
four months of 1997, Indian companies have bought 34 foreign companies for
about U.S. $11 billion dollars. This impressive development has been due to a
growth in inputs (capital and labor) as well as factor productivity. By the year
2020, India is expected to add about 250 million to its labour pool at the rate of
about 18 million a year, which is more than the entire labour force of Germany.
This so called demographic dividend has drawn a new interest in the Human
Resource concepts and practices in India.
Indian HRM in Transition
One of the noteworthy features of the Indian workplace is demographic
uniqueness. It is estimated that both China and India will have a population of
1.45 billion people by 2030; however, India will have a larger workforce than
China. Indeed, it is likely India will have 986 million people of working age
in 2030, which will probably be about 300 million more than in 2007. And by
2050, it is expected India will have 230 million more workers than China and
about 500 million more than the United States of America (U.S.). It may be
noted that half of Indias current population of 1.1 billion people are under of
25 years of age. While this fact is a demographic dividend for the economy, it
is also a danger sign for the countrys ability to create new jobs at an
unprecedented rate.
With the retirement age being 55 to 58 years of age in most public sector
organizations, Indian workplaces are dominated by youth. Increasing the
retirement age in critical areas like universities, schools, hospitals, research
institutions and public service is a topic of considerable current debate and
agenda of political parties.
The divergent view, that each society has a unique set of national nuances,
which guide particular managerial beliefs and actions, is being challenged in
Indian society. An emerging dominant perspective is the influence of
globalization on technological advancements, business management, and
education and communication infrastructures are leading to a converging
effect on managerial mindsets and business behaviors. And when India
embraced liberalization and economic reform in the early 1990s, dramatic
changes were set in motion in terms of corporate mindsets and HRM
practices as a result of global imperatives and accompanying changes in
societal priorities. Indeed, the onset of a burgeoning competitive service
sector compelled a demographic shift in worker educational status and
heightened the demand for job relevant skills as well as regional diversity.
Expectedly, there has been a marked shift towards valuing human resources
(HR) in Indian organizations as they become increasingly strategy driven as
opposed to the culture of the status quo. Accordingly, competitive advantage
in industries like software services, pharmaceuticals, and biotechnology
(where India is seeking to assert global dominance), the significance of HRs
is being emphasized. These relativities were demonstrated in a recent study of
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three global Indian companies with (235 managers) when evidence was
presented that positively linked the HRM practices with organizational
performance. In spite of this trend of convergence, a deep sense of locality
exists creating more robust cross vengeance in the conceptual as well as
practical domain.
Key HRM Practices in Indian Organizations
HRM Practice Observable Features
Job Description
Percentage of employees with formally defined work roles is very high in the
public sector.
Recruitment
Compensation
Training
and Poorly institutionalized in Indian organisations. Popularity of training programs
Development
and their effect in skill and value development undeveloped.
Performance
Appraisal
Promotion
Reward
Limited in scope. The seniority based escalator system in the public sector
provides stability and progression in career. Widespread use of voluntary
Career Planning
retirement scheme in public sector by high performing staff. Cross functional
career paths uncommon.
Gender Equity
Reservation
System
The central government has fixed 15 per cent reservations for scheduled castes,
7.5 per cent for scheduled tribes and 27 per cent for backward communities.
States vary in their reservation systems.
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9. Reward Ceremonies: Merely recognizing talent does not work, you need to
couple it with ceremonies where recognition is broadcast. Looking at the Dollar
Check is often less significant than listening to the thunderous applause by
colleagues in a public forum.
10. Delight Employees with the Unexpected: The last but not least way is to
occasionally delight your employees with unexpected things that may come in the
form of a reward, a gift or a well-done certificate. Reward not only the top
performers but also a few others who are in need of motivation to exhibit their
potential.
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able to promote the balance between career, family and leisure-time better. Other
sectors have also been increasingly promoting a work-life balance. Interestingly,
most companies in India use benefits such as flexible timings, telecommuting,
crche facilities and concierge services as an attraction and retention strategy. "We
are yet to fully buy into the fact that employees become more productive and
remain motivated when companies allow them to have a life beyond work," says
Prabir Jha, global head, human resources, Dr Reddy's Laboratories Ltd.
3. Inclusion and Diversity: With higher numbers of people joining the workforce
in India at a time when companies across the world have an ageing workforce on
their rolls, conflicts are to be expected. "One of the challenges companies face
today is resolving conflicts among different generations," says Pavan Bhatia,
executive director, human resources, PepsiCo India Holdings Pvt. Ltd. "An
inclusive and diverse workforce is the future of the workplace," he adds. Therefore,
companies are investing both time and resources in ensuring that all age groups are
comfortable working together. Organizations in India have also been focusing on
making workplaces more representative. For companies such as ICICI Bank Ltd,
Hindustan Unilever Ltd, Vedanta Resources, PepsiCo India, Shell Companies in
India and Bharti Airtel Ltd, gender diversity has become a critical area of focus.
4. Health and wellness: The work culture at globalized workplaces involves long
working hours, frequent travel, multitasking and tight deadlinesand all this often
leaves employees mentally and physically stressed. "Employees are increasingly
grappling with lifestyle-related diseases such as hypertension, diabetes and
cholesterol, which can be checked by regular monitoring and a healthy lifestyle,"
says A. Sudhakar, executive vice-president, Human Resources, Dabur India.
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at rewards systems more seriously, and are adopting total rewards practices that
include compensation in both cash and kind. Apart from lifestyle perquisites such
as a house, a car or a club membership, profit-linked incentives, deferred gratuity,
and wealth-building programs in the form of stock options and soft loans,
companies are also including work-life balance programs; competency pay
packages where niche skills are compensated; and career opportunities, such as
overseas assignments, new projects, etc., to reward staff. These rewards can be
tailored to suit the top performers' aspirations to achieve maximum effect.
8. Measuring human capital: Evaluation of performance plays a key role, not just
in rewarding an individual employee, but also in setting performance benchmarks.
And hence, there is the need for a fair and transparent performance management
system. A strong performance analysis helps make human resources both efficient
and effective. "In today's business environment, where the focus is on increasing
performance, companies must have robust systems to identify performers so that
the best performers get identified, recognized and duly rewarded," says Ganesh
Shermon, partner and head, human capital advisory service, KPMG India.
Shermon cites the example of oil and gas company Bharat Petroleum Ltd, which
has instituted a balanced scorecard based on key result areas to measure
performance.
9. Managing Aspirations: As aspirations of organizations grow, so do those of
employees. And, with the changing lifestyles and profiles of the workforce,
personal and professional aspirations of employees are not just varied, but are
increasingly on the rise. "Since competitive advantage depends on competent
people, knowing what employees aspire for could just be the way to have an edge
over competitors," says Kishore Poduri, head, human resources, eClerx Services
Ltd.
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10. 360 Degrees Feedback: Finally, recognizing the need to make performance
appraisal systems more effective, an increasing number of companies are using the
360 degrees or multi-rater feedback process. Unlike the traditional appraisal
system, which gives one-dimensional feedback, this one allows an employee to
give feedback to her reporting manager, peers, direct reports and others. "Multirater feedback not only reduces the risk of biased perceptions, but also gives you a
holistic view from all the stakeholders within the company," says Sanjay Bali,
vice-president, HR, Samsung India Electronics Pvt. Ltd. While most companies
started using this system as a means for performance appraisal, most of them now
use the 360 degrees feedback system to identify the learning and development
needs of employees.
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Attracting the next workforce, or preparing the current one, will require a
new workforce culture to better understand transnational teams, online
collaboration, globalization and business process transformation.
One of the most powerful forces affecting the changing nature of work and the
work force is demographics the changing distribution of the work force along a
number of important dimensions. Here we can only briefly highlight the most
important demographically- related changes that will be occurring during the next
decade. The work force of 2010 will be significantly different than it is in 2004,
but the characteristics of workers today are already very different from what most
of us think they are. And basic changes in the characteristics, beliefs, values, and
expectations of millions of workers in all functional areas will require equally
fundamental changes in the way those individuals and teams are managed. The
Changing Nature of Work and the Demand for Workers One of the most
important changes that affects both organizations and management is what we like
to call the demand side the kinds of workers who are required to do the kind of
work that needs to be done. For insight into how changes in the nature of work
itself are affecting who is in the work force, we reviewed the research by Professor
Richard Florida of Carnegie-Mellon University. His data shows very clearly that
the most rapidly increasing category of workers is what he calls the creative
class those who are engaged in what others have called high-end knowledge
work and what we have described as Creative Activities. The rise of knowledge
work as the dominant activity in the economy has driven the development,
coalescence, and emergence of this new class of workers those who produce
and apply knowledge. The middle class, the working class, and the service
class were products of the Industrial Revolution and the growing automation of
the means of production. The vast majority of jobs today involve producing,
applying, and distributing knowledge rather than things essentially creative
activities. Florida points out that creative work activities with low process
structure and unpredictable outcomes are what create economic value and
competitive advantage today. But the most important work force management
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insight stemming from his analysis is the values and expectations that Creatives
bring to their work. As he suggests, creative people: - Work on varied and
individualized schedules - Are self-motivated and self-directed - Rely on their own
tools - Place profession and career ahead of a specific employer - Expect to work
in a variety of job situations (and for a variety of employers) over time - Place a
high premium on self-control (that is, on being in charge of what they do, where
they do it, and under what conditions) - Prefer to work in close proximity to others
who share their interests, skills, and work styles - Tend to choose where they want
to live and work first, and only then worry about who they will work for, or where
they will find the kind of work they want to do Thus, without even considering the
basic demographic changes within the population at large, we already have a work
environment in which well over one-third of the work that must be done (and by
far the most important third) requires people who are very different from the
dependent manual laborers, clerks, and even middle managers around whom much
of organizational life (and management practice) has been built for the last several
hundred years.
Changing Work Force Demographics but equally dramatic changes are occurring
on the supply side of work. The behavioral and emotional attributes of the workers
who constitute todays work force are changing so rapidly that it is an open
question whether organizations will be able to adapt at all.
First, just consider the fundamental impact of recently changing birth rates along
with the aging of the so-called Baby Boomers. Birth rates have an enormous
impact on the labor pool, and thus on job opportunities, wage and salary
expectations, and related attitudes about work and life.
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Indeed, we believe the most fundamental driver of work force diversity today is the
continuing decline in birth rates in virtually all developed countries around the
world. The work force is aging, and it is growing at a much slower rate. The result
is a much broader range of ages in all professions generational diversity is a
new condition that most organizations have never faced before. And the shrinking
number of new entrants to the work force means more importing of labor (and thus
a more multicultural work force), more exporting of work, more use of consultants
and part-timers, and a growing need to keep older workers in the active labor pool.
To be more specific, in 1965 there were approximately 4 million live births in the
United States. Today those individuals are 39 years old, and at height of their
business careers. Just ten years later, in 1975, there were only 3.1 million births (in
the United States); those individuals are just 29 today but will be in their midthirties in 2010. That is decline of 28 percent in the biggest source of the labor pool
in just 10 years. And that means that talented workers will be short supply and
thus highly demanding for the rest of this decade. Because of those declines
there are fewer and fewer young adults entering the work force far too few to
replace those who are reaching the tail end of their careers. And with the Baby
Boomer generation now in its late 50s, that pattern is about to become far more
pronounced. The net result is that the work force in total is aging, and it is growing
at a much slower rate. U.S. Census Bureau data show a dramatic flattening of the
age curves over the next several decades. That is, there will be many more older
workers, and many fewer younger ones, based on current birth rates and population
statistics. And of course, older folks are staying in the work force much longer
as a result of both personal choice and economic necessity. In fact, many
organizations already have to cope with what amounts to four generations of
workers in the workplace all at the same time. These four groups are: Seniors
Baby Boomers and their elders who are 50- and 60-somethings, many of who are
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management and support. For example, this picture suggests that workers will ask
for and get much more choice in the design of their workplaces and a much
wider range of types of office equipment. In essence, we have to recognize that, in
Alvin Tofflers words, one size misfits all. This diversity will in turn put
enormous pressure on infrastructure and support staffs, which will be tasked to
satisfy those complex requirements and manage the resulting portfolio of
workplaces and technologies. Implications for Real Estate Executives The general
business implication of these demographic shifts is that there is going to be a major
talent shortage, especially for knowledge workers, in the developed world within
five years. Although the human resource management challenges are fairly
obvious, the implications for the real estate professional are perhaps less clear. We
believe that changes in demographics and an increased demand for creative talent
means that more work will have to be taken to the worker, not that workers will
migrate and relocate to wherever companies want to be. The basic location strategy
for sustainable companies within five years will be the development of a
workplace portfolio that has as its primary focus, Where are the workers we need
and how do we move our business there? In addition, this new work force will
demand and expect very different workplace configurations more
collaborative space in corporate facilities, a wider variety of locations and facilities
in which work can be accomplished, more personal control over when and where
they will work, and more support for remote and mobile work styles. The task of
real estate and facilities managers is clearly shifting from providing a place to
enabling the organizations work to get done wherever and whenever it must be
done. Organizations will need comprehensive real estate strategies of place that
appeal to all the major demographic segments. No one group will supply the talent
needed in the future. And the various groups will continue to have varying needs
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and expectations. Providing work force support is not going to get any easier in
the future; in fact, it will be far more complex than it is today.
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companies
in
assisting
to
bring
about
improvements
in
productivity,
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28
Initiatives like Cisco's succeed when companies focus on redesigning jobs and
retaining talent at the outset of downsizing efforts.
In addition to redesigning roles, companies cutting jobs should carefully protect
training and development programs. These are not only essential to maintaining
workplace morale and increasing long-term productivity, but they also give people
the skills necessary to carry out redesigned jobs that have greater spans of control.
During the last recession, International Paper continued offering classes at its
leadership institute by replacing external facilitators with the company's senior
leaders. This approach not only reduced the cost of delivery but also, thanks to the
involvement of senior leaders, redirected the content of the leadership program by
tying it more closely to decisions and skills affecting the company's current
performance. Similarly, IBM retained its employee-development programs during
its major performance challenges in the mid- to late 1980s. It took the arrival of
Lou Gerstner as CEO and a new strategy to turn the company around, but the
historical investments IBM had made in developing its people helped achieve a
successful turnaround.
Before undertaking widespread layoffs, companies should use their performancemanagement processes to help identify strong employees. Companies that conduct
disciplined, meritocratic assessments of performance and potential are well placed
to make good personnel decisions. These companies should also bring additional
strategic considerations to the decisions. They should assess which types of talent
drive business value today and which will drive it three years from now, as well as
which talent segments are currently available and which will be in the futurekeeping in mind, for example, that new MBAs will be equally available in two
years. They should also look at which types of talent would take years to replace or
develop-for instance, skilled electric utility engineers in an environment where
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workers hired rises in recessions. And opportunities to find and hire displaced
talent may be particularly valuable during this downturn, as massive downsizing in
the financial-services sector makes available to nonfinancial companies a large
pool of highly educated and motivated professionals who previously might not
have considered jobs outside their previous employers or industries.
Some organizations are moving surprisingly quickly in response to these
opportunities in the talent market. In late October 2008, the US Internal Revenue
Service hosted a Manhattan career fair targeted at displaced financial-services
professionals. More than 1,300 people attended, many standing in line for three
hours to learn more about an employer that offered a newly interesting brand of
"job stability."
Cost cutting during a downturn is often necessary to ensure a company's current
profitability and future competitiveness. Rather than freezing all hiring and
employee-development programs, companies should use this period as an
opportunity to upgrade talent and better engage existing staff. This means
reinventing a percentage of the capital liberated from cost cutting into, for
example, selective recruiting and development programs and in efforts to safeguard
the culture and to redesign jobs so that they are more engaging to the remaining
employees.
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CHANGES IN TECHNOLOGY
Technology may have made things easier for recruiting managers, but it s
beginning to show its evil side as managers go overboard with it...
Key learnings:
Technology is a tool that can be used to aid the recruiting process.
Technology cannot replace human touch and therefore cannot be used to build
relationships
Technology has indeed been a blessing. The reaction time to any problem has been
slashed over a hundred times and leaders, managers and the worker fraternity in
general is more connected now than ever before. However, like all good things, the
positive streak of technology too can fade if it's taken too far. Critics who play
down the role of technology, have always condemned the way technology has
eroded the personal touch among people. In addition, they blame it for the way
managers use it for the sake of speed and not quality. Amidst the brickbats,
technology has emerged as a force to reckon with and has undoubtedly redefined
the way business is done.
Technology is secular. It has touched every aspect of business however little it may
be. And the human resources function is no exception. In fact the role of
technology in the arena of staff management has been incredible and today the
function has become completely technology-driven. The function right from the
recruiting stage to the exit interview and everything that comes in between is
largely driven by technology. While this may be seen as a revolution of sorts by
some, for many such aggressive takeover is beginning to take its toll on the
efficiency with which the function is meant to be executed. And according to
analysts the first casualty is the recruiting function.
Impersonal recruiting: A recent forum on "Technology and Its Application in the
Human Resources Function", conducted at the Town's hall, at Vancouver, presented
a rather scary picture of what awaits us in the near future. A few speakers at the
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forum unintentionally spelt horror for the recruiting function. They were rather
candid about the way they recruit and the role of technology in their recruiting
process. One of the speakers went to the extent of saying that thanks to technology
there is no real need of meeting the candidate or even speaking to him. Recruiting
managers can make their decision by simply exchanging mails!
The trend is indeed horrifying. How can one replace personal relationships that we
by virtue of being humans share with everything that we come in contact with?
Reducing the potency of a relationship to a mere click of a button can be damaging
to the very basis on which an organization is built. If every recruiting manager
were to select recruits on the basis of the mails exchanged then the concept of a
"competitive edge" or a "differentiating factor" will not be there at all since
everybody would be doing exactly the same thing. Moreover in such a
technologically-intensive scenario , the need for any other staff management
initiative too would seem redundant as people would barely interact personally and
even if they did it would only happen in case of a system crash.
The scenario can be nerve- wrecking and therefore it's time recruiting managers
wake up and understand that technology is only a tool and it can by no standards
be used to replace relationships.
Focus does not stray. When recruiting managers lose perspective of the core issue,
the entire exercise fails. In this case, recruiting managers must understand that
recruitment is like sales, and they are the salesmen. Their main job therefore is to
sell the job And sales is a process that needs human interaction. Hence handing
over this process to technology can sabotage the defining purpose of the activity
and therefore may not give the desired outcome. Understanding that technology is
a mere tool to accomplish the objectives of the sales activity, which is recruiting in
this case would help recruiting managers keep technology in its right place.
A typical sales activity needs four basic pre-requisites for its success. These
include:
Each of these factors is relevant even as we see recruiting as a sales strategy. Hence
recruiting managers must use technology in the third stage where difficulties
hampering the activity need to be overcome by use of means that are both time and
cost-effective.
Understanding how technology can aid the process of recruiting will help
recruiting managers maximize their efficiencies. However, if they let technology
drive the process then the intended benefit may fizzle out and the process
efficiency would be affected adversely. The best solution therefore would be to
integrate the benefits of technology with the recruiting process in a way that helps
maximise its efficiency.
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CONCLUSION
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REFERENCES
Google.com
blogs.oneindia.in/24058/15/2/showblog.php
www.management-hub.com/hrmanagement9.html
www.allbusiness.com/human-resource-management/3131796-1.html
Business Today magazine, Jan 10 issue
Money Today, Anniversary issue
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