Challenges in SHRM

Challenges in SHRM

Learning outcomes:•Utilization of technology in HRM•Reduction of administrative cost•Issues for integrating new technologies•Impact of technology on organizations•HR issues and challenges related to technology•Work force demographic changes and diversity

• IBM HRSC:– 1997, created its HR Service Center based in North Carolina.– They utilized technology to:1. Not only improve the delivery of its HR program to its employee 2. Significantly reduced administrative costs– Utilized networking technologies to deliver HR information and

service to more than 500,000 active and retired employees (“customers”)

– Centers handles more than 1.5 million calls and processes more than 2.5 million transactions annually.

Challenges in SHRM

IBM HRSC: The Center Services over 20 separate IBM business Units in areas such as:

BenefitsRetirement planCompensationEmployee suggestionsStaffingJob postingOrientationPerformance managementEEO complianceEmployee separationSkills development

These specialist handle more complex issues pertaining to particular HR programs (i.e compensation, tuition, reimbursement, short term foreign services assignment)IBM’s strategy to improve employee service and reduce the costs of human resource administration has led to impressive results. This center reduced the cost of providing HR services by 40 percent.

Challenges in SHRM

Organizations face many challenges in traditional approaches to manage people and adopting an investment perspective to HR.

The four major arenas of change are:1. Technological advancement2. Increasing attention to ethical behavior3. Demographics and diversity4. Globalization

Challenges in SHRM

Impact of Technology

Challenges in SHRM

Consideration of adopting a New Technology

Strategic issues•Impact on productivity•Impact on quality of output•Impact on timing/delivery of output•Cost of equipment/technology•Adequacy of current facilities•New Market opportunities afforded

Strategic HR Issues•Necessary expansion/contraction of work force•Training needed to utilize new technology•Costs of hiring, severance, training•Effective management of change•Impact on work group dynamics

Challenges in SHRMTechnology:

– Most significant trends affecting HR and people in organization’s– Is the process of the organization in which it takes input and transform it in

outputit includes:– Tools– Machinery– Equipment– Work procedure– Employee knowledge– Skills of the employees

There is high competitive pressure on organization to make constant advancements in technology.

Financial considerations of whether to adopt a new technology must be balanced with a number of strategic issues and, more specifically, a number of strategic HR Issues

Upgrade existing employees skills and need to change work habits of employees.

Impact of Technology on organization (how the work is changing)Challenges in SHRM

• Requires changes in skills and work habits of employees

• Elimination of some lower-level positions and layers of management

• Less hierarchy, more collaboration

Challenges in SHRMTechnological changes:

– Creating demand for workers with more sophisticated training & skills– A significant number of new workforce entrants have limited technical

skills– Little or no training– (services industry situation)

These advancement resulted in:1. Elimination lower level positions held by employees; 2. Reduced employee headcounts 3. Remaining employees have high level of training and skills4. More technical trained employees required5. Organizational structure changes to fewer hierarchy levels6. Collaborative teamwork7. Growing trend for TQM

Challenges of SHRMTechnology:

1. Created more flexible organization structure2. Dynamic organization structure that facilitates changes and adaption

to changes in the organization’s environment3. Alternative structures take the form of unbundled corporations,

autonomous grouping or subsidiaries or smaller, streamlined units designed to be more responsive to changing customer needs and competitive pressures

HR issues & challenges related to technology

Three new areas of concern for HR and organization

1. Telecommuting2. Employee Surveillance & Monitoring3. E-HR

• Telecommuting– The process by which employee work from home,– Advances taking place in information processing

and telecommunication technologies are the key factors

– Its an agreement between employee and organization

– It involves management system that allows employees to how they fulfill job responsibilities.


• Telecommuting– In US a significant workforce has adopted

technology to work for organization– 3.4 million in 1990 to 19.6 million in 2000– Two-third of Fortune 100 companies currently

have telecommuting programs; remaining are planning to do so


• Telecommuting Benefits:– Environmental regulations (Clean Air Act)– Annually they are saving 9.5 million gallons of gasoline– 94 million fewer tons of pollutants– Retention aid as more flexible working condition– Employees personal reasons of their location– It also helps organization in flexible recruitment and allow

them to hire from broader prospective applicant pool– Significant saving in cost– Increased productivity


• Telecommuting HR Issues: (1)– Measuring performance– Monitoring progress– Performance and accountability standards will be

different– No face to face contactHP and Cisco Systems have successfully

implemented objectives-based performance management programs


• Telecommuting HR Issues: (2)– Which employees will be offered participation in

telecommuting program– Attention also must be paid to individual

employee characteristics– Telecommuting generally requires employees to

have strong organizational and time management and self motivated


• Telecommuting HR Issues: (3)– Purchasing equipment for employees home office– Liabilities for injuries; bcz home workspace is

considered an extension of the company• Telecommuting HR Issues: (4)

– May be managerial un-comfort


• Employees Surveillance & Monitoring– Technology has enhanced employee’s abilities to

do their jobs– Data availability on internet allows more

comprehensive and faster data collection when addressing issues and problems at work

– 90% employees admitted to visit other sites, chat rooms, gaming sties and banking, bill paying shopping.


• Employees Surveillance & Monitoring– Increasing number of employers have

implemented electronic monitoring of their employees, using SW to track employee internet use

– Monitor internet use as well as emails, computer files, voice mail and telephone usage

– May impact loyalty and morale of employee– Electronic Communication Privacy Act


• E-HR– Technological advancements have also provided

HR with an incredible opportunities to deliver many of its transactional types of services online, freeing HR staff to work on more strategic issues.

– Payroll, employee benefits, scheduling, recruitment, training and career development are just some of the areas that are being delivered in a self service format to the employees


• E-HR– Using E-HR to benefit both employees as well as

organization,– Range of HR activities that are being delivered

electronically– Time warner cable, Inc., in Houston has more then

1,660 employees, spread out over 27 locations. Majority works on great distance from HR office or staff.


• E-HR– In 2003; the city of Dallas stopped issuing

paychecks to its employees– Pay should be through direct deposits, paper

paychecks was expensive and time consuming– Electronic pay resulted in saving of 15,000 $

annual– airlines using internet for customer services– GM is an example


• E-HR (GM example)– World largest manufacturer of automobiles– Consumer websites– B2B portals– E-HR services through Employee Service Center– GM has rolled out its ESC to its international

divisions and sees the project as continuous, with an updated re-release of the site planed every 6 months.


• Ethical behavior of organizations are under discussion that it plays an role for success or failure.

• It may relate to:– Financial reporting or disclosure– How employees are treated– Employers practices and policiesReputation of organization is dependent on Ethical

behavior specially in deciding to accept an offer of employment.

Ethical Behavior

• A Survey:– 65% executives reported that they would

thoroughly investigate the culture and value system of any perspective employer.

– 40% executives had resigned from an organization at least once because of the employers unethical behavior

Senior management has to consider different dimensions of the employment relationship where ethical decision need to be made.

Ethical Behavior

• Universal definition of Ethics?• They are subject to personal values and

convictions• Ethical behavior is subjectively assessed as

right or wrong, appropriate or inappropriate, and in some cases moral or immoral

1. Employee behavior2. Employer behavior

Ethical Behavior

1. Employee off-duty behavior:– Its an area of ethical concern for HR is employee off-duty

behavior.– Winn-Dixie Stores situation

• Truck driver termination• 20 year history and performance• He was cross-dresser in private lifeCompany image ??? Services terminatedCourt case:• He was terminated for reason that had nothing to do with job or

performance. No law that protect employee off-duty behavior

Employee Ethical Behavior

• Employer also faces dilemmas about off-duty behavior

– Tobacco– Alcohol– Drug use– Political and religious

Employer Ethical Behavior

• Ownership of work is another important area of ethical consideration

• Good deal of employee work in a knowledge economy involves the application of knowledge and skills in the development of new and improves products, services, and processes, conflicts have arisen concerning IP rights.

• Fortune 1000 organizations incur losses more than 45$ billion annually from trade secret theft.


• Fairness of non-compete clause:– Employees may start work for a competitor or starting his/her

own business– Accountants, consultants , any professionals decide to start

their own business, do they have a right to bring client with them and/or recruit former clients

– Legal contracts?– Balance between job and own business– Sarbanes-Oxley Act was passed to eliminate both deception in

accounting and management practices by increasing government oversight of financial reporting and holding senior executives more directly responsible for violations.


• Sarbanes-Oxley:– The protection it provides to “whistleblower” employees

who provide information and/or assistance to investigators that assists in the review of potential violations of federal laws related to fraud against shareholders.

– The protection will be provided only when information is provided to one of three sources:

• A federal regulatory or law enforcement agency• Any member or committee of congress• A person with supervisory authority over the employee who has

the authority to investigate such allegations• if reported to media or HR manager, no protection will be

provided

Ethical Behavior

• Increased concern for ethical behavior and accountability

• Organization’s best interest is to produce code of Ethics

• Code of Ethical and Professional Standards in HRM developed by society for HRM for its members and profession.

• Executives can develop in-house codes

Ethical Behavior

• Demographic changes and diversity is creating number of challenges for HRM.

• These are critical to the success of organization (public and private)

• Some employers have commitment to understanding and appreciate diversity, other implement diversity initiatives simply to ensure compliance with federal, state, and local employment laws.

Workforce Demographic changes & Diversity

• Discrimination based on:– Race– Color– Religion– Gender– National origin– Age discrimination– Disability act

Workforce Demographic changes & Diversity

Advances in health care allows:– Live longer, remain healthier longer, remain in

workplace longer– Growing % in aged people; 13% to 20%– Organizations clearly benefit through the knowledge

and experience of older workforceGraying of the workforce can create number of challenges– Older worker resist changes– New tools, utilizing new technology– Increased health care cost – Productivity is related to new technology

Generational diversity

– Older worker can be:• More productive• Loyal to organization• Significant knowledge• Key contact in professional networkEmployers develop incentive programs for early retirement

and hire retirees as consultantsThey want to take advantage of their skills, experience and

links in the industry


Baby boomers, in their mid careerAs one moves up in hierarchy, there are fewer and

fewer positions are available and competition in middle and high level rank

– Here technology plays an important role, many senior and middle level management positions have been eliminated because of flatter organization and increased use of IT.


Baby busters, born during declining birth rateLower expectations relative to the pace of their

careers.Baby boomers of the previous generation have

essentially created a bottleneck in the management hierarchy that busters find themselves behind.

Availability of workforce in one era as compare to other makes difference in wages.


Individual dimensions of diversity

Work related• Motivation• Personality• Work Ethic• Experience• Attitudes

• Job responsibility• Employment status

Personal

RaceResidence

Hobbies

Family status

Marital status

Ethnicity

Age

Religion

Gender

Sexual orientation

Physical ability

1. Determine why diversity is important for the organization

2. Articulate how diversity relates to the mission and strategic objectives of the organization

3. Define diversity and determine how inclusive its effort will be

4. Make a decision as to whether special efforts should be extended to attract a diverse workforce

5. Assess how existing employees, customers, and other constituencies feel about diversity

6. Determine specific types of diversity initiatives will be undertaken


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Challenges in SHRM

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