Last Updated 10 May 2020

The Changing Role of Human Resource Management (HRM)

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Developments in the internal and external environment of business firms have made human resource management a key aspect of business success. This meant the expansion of the scope of human resource management work and the enhanced role of human resource managers to accommodate these developments. Since trends require shifts in the caliber of the people comprising the organization, the burden to ensure the achievement of this goal by the organization falls under the ambit of responsibility of human resource management. (Bates, 2002)

Globalization fragmented business organizations and heightened competition. The opening of economies created the potential for firms to get access to competitive labor, both skilled and unskilled, to support cost-effectiveness. This means the challenge to attract skilled workers and retain them.  Business organizations also have business units or entire departments scattered around the world.

By operating in the international labor market, there is also need to consider and manage compliance with international standards and national regulations. This broadened the importance of human resource management to take on new tasks. One task is to develop policies for the management of people in line with the vision of the company but accommodative of different domestic contexts. This addresses the issue of balancing and reconciling internationalization and localization.

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Another task is designing human resource management strategies and systems to link and align the departments or business units located in different countries with headquarters. Still another task is influencing the shift towards the global perspective of the company for the integration of international standards into organizational culture with room for varying application in the local setting. (Friedman, 2007)

Technological innovations have made human resource managers enablers of the organizations technological competence for a number of reasons. Geographically scattered businesses benefit from technological tools, particularly information and communication technology (ICT), which supports effective communications and the easy sharing of information to ensure accurate strategic decisions. Ensuring organizational cohesion in this context, which ICT secures, forms part of the role of human resource management.

The direction of people management also shifts when considering the trends in technology. Deskilling becomes important to facilitate the adoption of technology intended to improve performance and productivity. The emergence of knowledge workers means the need to tap into this labor pool. Business firms, especially multinational corporations, also need to establish technology-assisted networks through internal or external skills. (Burke & Ng, 2006)

Diversity emerged as an issue in global organizations. This refers to the different ethnic and cultural background of the firm’s global workforce that could cause issues within the organization if unaddressed. Since the success of a global organization rests in its ability to unify an ethnically and culturally diverse workforce, human resource management has to ensure the sensitivity of the organizational environment to differences. Human resource management has three roles to play in ensuring organizational sensitivity to diversity.

One is designing policies accommodative of differences in values but integrative in fostering shared visions. Another is developing management systems that encompass the traditional functions of recruiting and retaining human resources reflective of the ethnic and cultural diversity of the organization. New policies should be the result of inter-cultural sharing. Last is creating processes that reinforce diversity within the organization including communications and management practices. (Muncherji & Gupta, 2004)

E-business has changed the organizational environment by providing a means of speeding up business through technology. This made speed a component of quality performance. This posed a new challenge for human resource management to facilitate the necessary adjustments in the business firm to secure an effective speedy way of conducting business. One adjustment is building new competencies aligned with the requirements of e-business or refashioning existing competencies to apply to the e-business model adopted by the company.

Another is to innovate on human resource practices to accommodate the challenges emerging from operating in the virtual economy. Last is building collaboration between human resource management and IT skills for the determination of the appropriate tools that fit organizational needs and encourage technological investment by the firm. (Mitchell, 2001)

Ethical issues represent competing and conflicting interests or needs among the stakeholders of the business organization. Conflict in interests or needs change in the era of globalization and electronic economy because of the different impact on human resources. E-business enabled outsourcing that affected the existing workforce and changed the process of managing human resources.

IT systems shifted the focus of demand to e-skills and knowledge workers. Several ethical responsibilities emerge. One is managing the impact on morale after the reorganization or replacement of workforce as a cost-cutting measure. Another is ensuring ethical component of policies, such as the accommodation of diversity, of new e-processes. (Vickers, 2005)

Globalization, technology, diversity, e-business, and ethics have enhanced the role of human resource managers. Changes in the management of human resources encompass policy development, strategic planning, and issue considerations.

References

Bates, S. (2002). Facing the future - human resource management is changing. HR Magazine. Retrieved March 30, 2009, from http://findarticles.com/p/articles/mi_m3495/is_7_47/ai_89025017.

Burke, R. J., & Ng, E. (2006). The changing nature of work and organizations: Implications for human resource management. Human Resource Management Review, 16(2), 86-94.

Friedman, B. A. (2007). Globalization implications for human resource management roles. Employee Responsibilities and Rights Journal, 19(3), 157-171.

Mitchell, M. E. (2001). Human resource issues and challenges for e-business. American International College Journal of Business. Retrieved March 30, 2009, from
http://www.allbusiness.com/sales/internet-e-commerce/835119-1.html.

Muncherji, N., & Gupta, O. K. (2004). Role of human resource management in developing ethnic and diverse enterprises. International Journal of Management and Enterprises Development, 1(2), 155-163.

Vickers, M. R. (2005). Business ethics and the HR role: Past, present, and future. Human Resource Planning. Retrieved March 30, 2009, from http://www.allbusiness.com/human-resources/employee-development-employee-ethics/394111-1.html.

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