Trends in Human Resource Management

CHAPTER 2 - TRENDS IN HUMAN RESOURCE MANAGEMENT

Learning Objectives

1. Discuss external forces that affect the organization including the role of HRM.

2. Define following terms: Levels of analysis, competitive forces, psychological contract, efficiency, effectiveness, SWOT analysis, remote forces, HRIS, knowledge workers

3. Describe trends in the labor force composition (demographics) and how they affect human resource management.

4. Summarize areas in which human resource management can best support the goal of creating a high-performance work system.

5. Identify ways HRM activities can support organizational strategies for quality, growth, efficiency, and effectiveness.

6. Discuss how technological developments are affecting human resource management.

7. Explain how the nature of the employment relationship is changing.

External Forces (Opportunities and Threats) - It is important to consider the strengths (core competencies) and weaknesses in the context of external opportunities and threats. One organization's threat is another organization's opportunity. The organization is influenced to varying degrees by three layers of the external environment (remote, industry, operating) See Diagram 1

1. Remote - Influences all industries although not to the same degree. Many of these interact. For example, changes in beliefs about childcare (social) may lead to changes in tax law (political and economic). Organizations often neglect this level of analysis. See Diagram 2

 Economic - general economic conditions, disposable income, wage rates, unemployment rate, inflation rate, productivity

 Social - demographics (See change in the labor force on p. 32), geographic distribution of population, income levels, education, lifestyle trends, leisure, consumption, values, opinions, beliefs

 Political - laws and regulations at every level (city, county, state, federal)

 Technological - new products or services, processes for improving quality, performance, reliability.

2. Industry - Influences all organizations within industry such as fast food or banking - Often described as competitive forces. Effective HRM can be a powerful competitive advantage. Five competitive forces: Entry barriers, Supplier power, Buyer power, Substitute availability, Competitive rivalry

3. Operating (Competitive) day to day operations - Specific to organization - factors that affect an organization's success in acquiring needed resources (i.e. qualified employees) and profitably marketing