Business Chapter 2

Not inc. resistance to change

What is human resource management? What is the role of an HRM department?

HRM is how an organization manages its HR, including recruitment, retention, setting compensation, specifying responsibilities, etc.

While HRM is important for all businesses, it’s especially so for tertiary and quaternary sector businesses. They need to ensure that employees are in jobs for which they are properly trained and suited, and that the number of employees is appropriate.

What are the external factors that influence HR planning?

• Labour Mobility: Factors that influence occupational mobility (ie. changing jobs) and geographical mobility (ie. changing locations) affect the labour pool.

• Educational Changes: Rising or falling education levels impacts the suitability and skills of labour.

• Government Regulations: Laws regarding health and safety, maximum hours, equality, and even pension provisions like retirement age.

• Other: Flexi-time, remote working, gig-economy.

• Demographic Change: Aging population, reduced fertility, change in migration, etc. impact labour availability and willingness to work.

• Immigration: New workers being available or change in skillset of newly arrived.

• Economy’s State: Boom will lead to strain and increased wages while depression will leave to more workers for lower wages.

• Technological Changes: ICT developments can lead to more WFH. Infrastructure development can also make transport easier.

• Social Trends: Role one women, number of single-parent families, importance of work-life balance, etc.

What are the internal factors that affect HR planning?

• Changes in Business Organization: Reorganization to better meet strategic objectives affects HR planning. Can also occur due to acquisitions of or by the business.

• Changes in Labour Relations: If labour chooses to unionize, business has to agree with union requirements. If union power decreases, business has more flexibility. Long-term labour circumstance change.

• Changes in Strategy: Can be due to market changes or business reorienting itself, HR plan will need amendments.

• Changes in Finance: Businesses with limited finance can’t pay high wages, affecting recruitment and retention. Can affect number and longevity of staff.

What changes in work patterns affect HR?

Work pattern change is mainly powered by ICT development.

• It has led to an increase in occupational and geographical mobility. People can easily work out which skills are needed and develop accordingly.

• ICT provides opportunity to match people to jobs and countries that need their skills as it allows for faster data processing and dissemination of information.

What changes in work practices affect HR?

Practices in decline:

• Full-time work - working the maximum hours per week accepted by law.

• Permanent contracts

Practices on the increase:

• Part-time work

• Temporary work - on a fixed-term contract.

• Freelancing - someone who is self-employed working for several different employers.

• Teleworking and WFH

• Flexi-time

• Casual Fridays

• Three-day weekend

• Gig economy - hiring independent workers for short-time commitments. Good because it allows for flexibility for workers and employers. Bad because employees miss out on full time benefits like sick leave or paid vacation.

What changes in work preferences affect HR?

• Career Breaks: Stop working for a year or two before returning to the same career. Sabbatical if the employer formalizes this and agrees to take the employee back after the break.

• Job Share: 2 or more employees share a job to free up time for other activities.

• Downshifting: Giving up a senior position to change career into a different, lower-paid field of interest.

• Study Leave: Granted time off work to acquire a new qualification, ex. MBA.

What is the impact of innovation to HR?

Innovation, or the opposite inertia, both have impacts. A business committed to being innovative needs more focus on HR, as it needs the right people and environment to help the creative process.

What is the impact of ethical considerations to HR?

HR is based on relationship, that is reflected in the way a company treats its employees. Social network sites increase the need for better ethics because employees can tell each other how they have been treated. It can also lead to larger overall changes if enough concern is mobilized.

What is the impact of cultural differences on HR?

Business who adapt their HR plan to a multinational, varied workforce are more likely to be successful, especially if their markets are as diverse as their workforce. As seen in Hofstede’s cultural dimension, there are various differences between cultures, such as power distance, long-term orientation, etc. Training people to work in diverse workforces can reduce misunderstanding and friction, and in turn increase creativity and innovation.