MODULE 4 : Evolving Strategic Role of Human Resources

Learning Outcome:
After completing this module, the students will be able to:
➢ Understand the concept of Evolving Role of Human Resources
➢ Understand the Evolving Roles and Responsibilities of Human Resource

Introduction
The Human Resources (HR) profession is rapidly changing and expanding.
As the world of work evolves, new areas of expertise are required to drive business
results within organizations.
Additionally, there is an over supply of labor and an under supply of the right
talent on the global market. The over supply of labor comes after a global recession
followed by a tepid (lukewarm or unenthusiastic) economic recovery, while the
under supply of talent resulted from rapidly changing technology and business
dynamics.
The skills required to meet employers' needs from yesterday are already dated,
widening the skills gap and perpetuating the global talent shortage. Because
economic, demographic, technological and social forces will continue to evolve,
companies must have a flexible and agile (quick) workforce.
To achieve this, HR professionals must adopt three (3) critical roles:
1. HR as Supply and Demand Experts - although HR practitioners have
encountered supply and demand issues before, they are now expected to be
the de facto (in effect or in fact) experts.
They must understand how demand for their companies' products and services
impacts the demand for talent and assess whether or not the results align with their
business strategy.
Specifically, HR must ensure that their organizations have the right balance of
skilled talent to meet changing needs and achieve business goals. HR leaders need
to provide market intelligence supported by relevant data, understand their internal
and external talent supply and how forces are reshaping the availability of required
skills.

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 2. HR as Marketers - the second role that HR must adopt is that of marketer.
Talent is now also a savvy (sharp or intelligent) and sophisticated consumer.
HR needs to understand and consider how organizational branding, messaging
and image can help win in-demand skills. In a world of talent shortages, HR's
role has expanded to include attracting and retaining customers/talent, in the
same way that marketing segments and targets consumers of the company's
products and services.

HR must think differently and shift from one-size-fits-all approaches to create value
propositions that appeal to the needs of individuals and align with organizational
objectives.
To access talent in an increasingly competitive marketplace, organizations must
pinpoint and market their strengths to attract talent pools with the skills their
businesses need to succeed. Marketing can't stop as soon as a company successfully
gets talent through the door.

3. HR as Designers - the third role HR leaders must adopt is that of designers—

thinking differently about how to structure work to access, mobilize, optimize
and unleash the potential of current and prospective employees.
Instead of focusing solely on jobs, HR professionals should expand its view to
include the intended outcomes of work.
Work models should be re-imagined to fully leverage the talent ecosystem, manage
a diverse workplace, while continuing to increase productivity and innovation.
Structuring work innovatively to include various models from traditional (dedicated
to the relationships between companies and employees) to strategic (linking HR
practices with company objectives) can help advance business goals and attract
skilled talent.
Working as designers, HR leaders must build systems to drive desired outcomes and
develop the right balance of talent. As more and more segmentation and specificity
of work, particularly knowledge work, is demanded, work will be divided into
smaller and smaller tasks, which will be distributed to many people.
Work will also increasingly be performed by freelancers and consultants willing to
work on an outcome basis, so that they can choose the work they want to do. A

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different way of thinking is needed to cultivate communities of work and balance
the employment mix to include contingent, fully outsourced, partially retired and
other workers—as permanent, fulltime employment is no longer by default the best
fit for employers or individuals or what drives time to value.

Evolution Stages of HR
Employees are integral for any business, and understanding the human resource
function is essential to manage them. Business plans, strategies and implementation
of these plans are dependent on how human resources discover innovative
approaches to resolve employee-related issues. A review of the past stages of the HR
department's evolution helps in understanding how HR reached its present state.

Industrial Era Personnel Management

The 20th century witnessed severe labor unrest due to the employment-at-will
doctrine and yellow-dog contracts that allowed employers to fire employees at will.
(At-will employment doctrine - states that employment is for an indefinite period
of time and may be terminated by either the employer or employee. This freedom
also applies to employees, who can leave a job at any time for any or no reason with
no adverse legal consequences)
(Yellow-dog contracts – a contract between a worker and an employer in which the
worker agrees not to remain in or join a union)

These rules also restricted employees from participating in union activities. Because
of frequent strikes and lack of manpower, companies instituted personnel
departments to perform administrative activities related to employees. This was the
time labor unions became prevalent, and the personnel department was used to
resolve wage-related issues and other differences between the union and
management.
The personnel manager was responsible for employee attendance, labor-dispute
management and general compliances of employee health and safety
requirements. The recruitment section of the personnel department dealt mainly with
selecting labor employees, along with a few salaried professionals.

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Post FLSA HR

The Fair Labor Standards Act of 1938 was instituted around the time of the great
depression. The FLSA mandated minimum wages, which brought cheer to the
working population along with other laws that safeguard employee interests.
Organizations set up management teams that handled various facets of business.
As such, the personnel department’s role evolved to primarily statutory compliance
and employee health and safety concerns.
At this time, training and development took precedence in businesses, and the
human resource department was created to address the need. Key HR functions,
therefore, included performance and succession management, along with training
and development.

21st Century HR
Changes in the economic conditions of the 21st century brought about the need for
HR to take on additional responsibilities. HR staff, therefore, began actively
participating in business decision-making. Often sharing a seat at the management
table, they help determine when to downsize, outsource, retrain and recruit suitable
talent.
HR staff also participate in managing the cost of employee benefits such as insurance
and pension and in handling other issues and activities such as creating and
documenting policy, assisting with employee-related litigation and ensuring
compliance with employment laws such as the Employee Retirement Income
Security Act.

Information Age HR
The invention of new technologies and improvements on old ones has introduced a
way for businesses to work across international borders. Thus, information
technologies and globalization has changed business processes and opened up new
avenues and challenges for human resources. While the costs are reduced and
manpower is abundant, human resource areas experienced unforeseen challenges.
Some of these challenges include difficulties in managing employees dispersed

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across the globe, adjusting to new cultures and allocating resources in a timely
manner.
Here, new options such as simulated training and resource management software are
used to help bridge the gaps. HR departments changed again to adapt to the
information age and stay above the manpower challenges.

Work in the 21st Century: The Changing Role of Human Resources

There are an incredible number of pressures on today's organizations. To name a
few:
1. Environmental pressures such as increasing globalization, rapid technological
change, and tougher competition
2. Organizational changes such as new organizational alliances, new structures
and hierarchies, new ways of assigning work, and a very high rate of change;
3. Changes in the workforce including employees' priorities, capabilities, and
demographic characteristics.

Within these pressured organizations, there is a need for (and opportunity for)
the human resource function to play a critical role in helping organizations
navigates through these transitions. In order to play this role, however, HR
will have to increase its real and perceived value.

The role of human resources has been evolving for some time. The shift from
"personnel" to "human resources," for example, was part of the movement to
acknowledge the value of employees as an organizational resource, and was an
attempt to remove some of the stigma (mark of disgrace or shame) that was coming
to be associated with slow, bureaucratic personnel departments.
This shift in label was accompanied by a call for HR to become a strategic partner
with the leaders of the business to contribute to significant business decisions, advice
on critical transitions, and develop the value of the employees. In short, to have a
seat at the table.
Dave Ulrich provides a clear path to the next generation of HR with Human
Resource Champions: The Next agenda for Adding Value and Delivering Results
(1997).

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Ulrich presents his approach in terms of deliverables, or outcomes, for which HR
should be responsible based on the four (4) areas namely:
1. Strategy Execution 3. Employee Contribution
2. Administrative Efficiency 4. Capacity for Change

In the course of delivering in these four areas, he describes four (4) corresponding
roles for HR to play within a business:
1. As a strategic partner working to align HR and business strategy
2. As an administrative expert working to improve organizational processes and
deliver basic HR services
3. As an employee champion, listening and responding to employees' needs
4. As a change agent managing change processes to increase the effectiveness of
the organization.

One of unique things about Ulrich's approach is that it includes all of the ways that
HR can deliver value to an organization, rather than shifting focus from one area to
another.
Similarly, Johnson (1997) describes his experiences in executive search in which
CEOs describe the HR leaders they want to hire. They want people who will be
successful business partners, strategic thinkers, and people who will understand the
pressures of running an effective business in today's market. He reports that, when
hiring a leader for the HR function, most CEOs ask for someone who is, "not a
typical HR person," and that most of the successful candidates describe themselves
that way.

Common Steps and Activities that will increase the likelihood of success.
1. Strong HR leadership. As with any major change effort, a strong leader can
develop a clear vision, motivate others to share that
vision, and help them work toward achieving it.
2. Strong Future Orientation. One of the ways that HR can provide value is to

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 understand how changing environmental,
organizational, and workforce factors will
influence the business, anticipate the associated
HR needs, and be prepared to deliver
appropriate solutions to meet those needs.

3. Flexibility and Creativity. An HR group that is successful in the future will

likely be one that is responsive to the changing
needs of its client organization. Responsiveness
in the changing world of work will require being
flexible-as the organizations change, so will their
needs and priorities.

4. Delivering Value. Although this is not a new challenge for HR, it remains a
critical one. HR is still perceived by many within today's
organizations as simply a non-revenue generating
function. It is important to make apparent the value
provided by working with the management team to hire
the right people, manage them well, pay them
appropriately, and build a working environment that
encourages success.

Beatty and Schneier (1997) extended the concept of delivering value within the
organization by arguing that HR must deliver economic value to the customers, as
well as to employees. Similar to other strategic units, SHRM will be expected to
work in outcome based model where the result of their action should be specific and
measurable. Many of new businesses have a dedicated service line with staff
placement models and these approaches have direct revenue generation impact of
SHRM practices.
Strategies around up-skilling and cross-skilling of existing workforce deliver and
demand direct business impact for SHRM leader.

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 Summary

The role of Human Resource professionals has been steadily evolving over the
course of the last century. Shifting from the antiquated “personnel” department to
“human resources” has in and of itself transformed the way that companies see the
human element.
This change has come about as a result of improved employment laws, improved
working conditions and economical challenges that have rocked all industries. Thus,
the job of the average HR person has also had to change to keep up with the demands
of organizations on many levels.
When you ask the HR professional of today to define his or her role within the
company, you’ll generally get a variety of answers. It seems that human resources
has many responsibilities that adapt for different types of industries and
organizations.
While HR professionals are still fighting to be seen as strategic partners in the
meeting rooms of many companies, their value has risen in the eyes of company
leaders. Now seen as a true resource, HR officers work in tandem with department
managers and decision makers to forge the workplace of the future.
With the wave of economic challenges that the United States and many other
developed nations have experienced in the last few years, HR professionals have
been forced to evolve in many unexpected ways. Instead of just handling routine
employment duties, HR personnel are now also handling the heavy burden of
recruiting, training and developing employees in as safe a workplace as possible.
In the past, HR professionals were asked to specialize in one area of this realm, but
today the best HR people are generalists who have the ability to handle any and all
area of human resources.
HR professionals must stay on top of hiring and employment laws, which change
frequently. But in the last decade, human resources professionals have also been
required to track with greater detail every aspect of these processes.

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The HR person of this time has to be in all places at once. The traditional hierarchy
of the HR department is also evolving, with teams of equally-responsible officers
representing all facets of corporate life.
As an HR professional, your role will continue to evolve as new and more advanced
technology permeates (spread throughout) the workplace in years to come. You may
be managing a more remote workforce in all corners of the earth, or you may be
conducting live training sessions via Skype.
Wait, you are doing this now! Whatever the future holds for human resources, be
ready to face the challenges of life as an HR professional through continual
education and networking to stay ahead of the trends.