Human resources management challenges
Environmental challenges are outside factors which affect the company. There are a lot of different outside challenges for HR. Rapid change on the market you operate in and technological advances means a company has to be able to adapt to the new circumstances in a timely manner. The introduction of the internet had increased the information flow a company has to deal with. It also breaks down certain labor barriers. The internet allows all departments in a company to handle operational differences a lot faster. The book focusses on HR but this is true for every division in companies. The increase in globalization leads to global alliances. Leading to cost reduction and possibility to access the global labor and consumer market. This leads to competition in wages. National labor costs influences companies decisions on where to open new factories and offices. Another outside force influencing an organizations hr-strategy is legislation, governments pass legislations in order to protect workers and companies. A change in the political landscape can lead to different laws forcing a company to adapt. Shortage in certain skills needed for jobs such as IT are also an external factor which influence a company´s hr policies. More and more people are looking for a better work-life balance. This forces HR to rethink some of their policies in order to cater to this. The cause of this change is linked to dual career couples.
An increase in diversity can lead to some issues. This makes managing your workforce harder. Some companies put in diversity quotas, which is arguable not the best decision or strategy. An increase in different points of view and skills is a more effective method to increase productivity and innovation in a company. However, this can to friction between employees.
organizational challenges are factors within the company. Effective management can prevent issues. A good manager can spot issues before they become to big and take proactive measures.
Competitive positioning in a market is key to a organizations survival. Controlling costs be it production or labor costs is a big part of this. A good compensation system is both beneficial for the company and the employee. An employer wants to make working for his company appealing to potential recruits. While an employee wants the company he works for to stay in business. A down turn in economical activity could force a company to downsize or restructure itself in order to survive. The HR- department and strategy plays a big role in this.
Individual challenges are related to single employees. Hr strategies are linked to a companies performance. It´s HR jobs the find the right people for their company. For example finding a manager for a fast growing company is different as for an already mature company. Different skillsets and personal traits are needed. Finding people who fit in your corporate culture also determines the effectiveness of the firm.
Strategic human resource management
Strategic human resource management is on of the key SuccessFactors for a company. Good strategic management leads to a more effective workforce at a lower cost to the company. Some of the key factors in strategic management are: decentralization of decision making, downsizing, restructuring, creation of self-sufficient teams, company culture, security, use of new technologies, outsourcing and more. One of the biggest decisions is when to outsource and what you can outsource in order to decrease costs or increase quality and productivity. It makes sense for apple to outsource production while they handle design and software. Playing to your companies strengths and knowing it´s weaknesses.
Implementing or adjusting a companies strategy is a complex process. It can also make employees feel uneasy or afraid of their job security. In order to manage this clear and open communication is needed. Discussing strategy with your employees can help to create a more effective strategy by involving different points of views. A strategy isn´t fixed, you have long-term strategy which is around 5 years ahead and short term which is at maximum around 2 years long. A strategy isn´t fixed and should change if circumstances change. A good strategy acts as a general guide but not a step by step plan that has to be followed to the letter. The two most important questions a company should ask are: Where are we now and where do we want to be.
Gomez-Mejía, Balkin and Cardy define corporate strategy as “the mix of businesses a corporation decides to hold and the flow of resources among those businesses”. Corporate strategies can be divided in two categories: evolutionary and stationary. Evolutionary means a company evolves overtime diversifies it´s products. This can be done in several ways. Taking over other companies or creating subsidiaries. These new elements in the company structure can remain self governed and semi independent. A stationary or steady strategy implies that the company stays with it´s core product. It can still buy other companies but they will be in the same product or service category. This is a valid strategy as you are buying out your competition. In addition to these Porter has created 4 generic strategies which apply to every company. Cost leadership means you aim to be the most cost effective, driving your production costs as low as possible thus increasing your profit margin and price competitiveness. Secondly you have product leadership, you created the best quality product or service and asking a premium for this better quality. This strategy often focusses on a niche market. Lastly there is differentiation, having a broad portfolio of products or services.
Miles and snow created another well-know business unit strategy. They say a business unit either adopts a defender strategy or a prospector strategy. A defender strategy focusses on costs efficiency and protecting and established product and market share. This is often used in stable markets which have already matured. Secondly there is the prospector strategy. Focusses more on innovation and differentiation. Creating or entering new markets. This is a good strategy for new business or businesses in rapidly changing markets.
Child refugees in Turkey making clothes for UK shops
An investigation by panorama uncovered horrible production locations where child refugees were making clothing. They were making cloths for Marks and Spencer and Asos. Adult refugees were also found to make clothes for Zara and Mango in turkey. Marks and Spencer says internal investigation haven´t found any proof of this happening in their supply chain. However they did say that the findings are unacceptable and go against their contracts with their suppliers. These refugees work for a below minimum wage compensation and have to work in horrible conditions
Finding the Best HR Consulting Company to Help Build a Strong and Motivated Team
Hr outsourcing can save costs. However, finding a good firm can be hard. The best areas to hire an HR firm include: healthcare and benefits, implementing rewards and incentives, recruitment, talent management, after mergers and transition periods, communication, behavior issues and outsourcing. The most outsourced areas are usually pension plans, healthcare plans, payroll management and training.
Benefits Of HR Outsourcing: How Even Small Businesses Can Provide Great HR (Forbes)
Human resources are a key part of a business. for small businesses it is hard to be competitive in every area. They don´t have the same resources as bigger companies and multinationals. Meaning they don´t have a sufficient budget for their own HR-personal. Even if they can it isn´t always the best allocation of their resources. Outsourcing HR can give them a better HR service at a lower costs. Specialized companies offer a better service at a lower price.
HR Outsourcing Trends (smallbusiness chron)
Outsourcing human resources isn´t new. It has become bigger within HR-departments. This is a result of companies trying to focus their manpower and financial resources more effectively. There are three main areas that are being outsourced: Retirement plans, healthcare plans and payroll services.
Retirement plans require a lot of legal work and tax reporting. Outsourcing this to outside firms can reduce the amount of time spent on paperwork and the companies who are specialized in this have more knowledge. The fee paid is usually than paying your own employees to do this.
Payroll services used to be a written check. This has become more complex, requiring state and federal taxes. Adding to this the deduction of insurance premiums makes it more complicated. Assets must also move over from payroll budgets into employee salary-reduced benefits plans, matching programs and other incentive plans offered by employers. Payroll companies specialize in taking the funds and allocating them correctly and providing the HR-department with the necessary reporting paperwork.
References
AdvisoryHQ 2018. op 7 Best Firms for HR Consulting | 2018 Ranking. URL: https://www.advisoryhq.com/articles/hr-consulting-firms/ Accessed 23.11.2020
BBC 2016. Child refugees in Turkey making clothes for UK shops. URL: https://www.bbc.com/news/business-37716463 Accessed 23.11.2020
Forbes. 2018. Benefits Of HR Outsourcing: How Even Small Businesses Can Provide Great HR. URL: https://www.forbes.com/sites/allbusiness/2018/04/26/benefits-of-hr-outsourcing-how-even-small-businesses-can-provide-great-hr/?sh=60274a45620f. Accessed 23.11.2020
Leonard, K. Smallbusiness chron.2020. HR Outsourcing Trends. URL: https://smallbusiness.chron.com/payroll-fall-under-hr-accounts-payable-59665.html. 23.11.2020
Gómez-Mejía, L.R., Balkin, D.B., Cardy, R.L. 2016. Managing Human Resources. Eight edition, Global edition. Pearson. London
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