leadership by human resources
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Leadership by Human Resources. Organizational Roles and Choices. Top 5 Barriers to HR Leadership. HR and its employees lack business and strategic orientation HR executives not respected by top management HR holding on too much to the HR of the past- paper-pushing roles - PowerPoint PPT PresentationTRANSCRIPT
Copyright 2000 - South-Western College Publishing
Leadership by Human Resources
Organizational Roles and Choices
Copyright 2000 - South-Western College Publishing Module 3 - 2
Top 5 Barriers to HR Leadership
• HR and its employees lack business and strategic orientation
• HR executives not respected by top management• HR holding on too much to the HR of the past-
paper-pushing roles• HR unwilling to take the lead in facilitating
revolutionary change• HR chases too many fads/ quick fixes
Copyright 2000 - South-Western College Publishing Module 3 - 3
Module Objectives
HR Responsibilities and Objectives HR Roles Management Choices/ Constraints on HR
Decision-making Delivery of HR Roles Human Resource Effectiveness: Contrasting
Approaches
Copyright 2000 - South-Western College Publishing Module 3 - 4
What is Effective Management of Human Resources?
• Think about companies that you or someone you know have worked for or you’ve read about. What is it about these employers HR practices that might lead you or experts to rate them as being particularly effective?
• Employees are valued• Innovative HR
policies (invested in employees)
• Strategic HR orientation: Goal of HR was to make the business successful
Copyright 2000 - South-Western College Publishing Module 3 - 5
Why is Effectively Managing HR Critical to Organizational Success?
• Labor costs are a major organizational operating expense
• People affect productivity • Having a skilled, motivated, and adaptable
work force or (“people embodied organizational skills”), is directly related to firm profitability.
Copyright 2000 - South-Western College Publishing Module 3 - 6
Introduction: Traditional (Old) HR Paradigm
H uman R esources M anagersAccountab ility fo rM anaging P eop le
B usiness Unit M anagersAccountab ility fo r
B usiness R esults
•Think “People” First - The Conscience•Less sensitive to Business Impact•Leverage Human Assets to Maximize Employee Satisfaction and Contribution
•Think “Bottom Line” First•Less Alert to People Impact•Leverage Financial and Capital Assets to Generate Profits, and “Delight” Customers
Source: Adapted from Conner, J. And Wirtenberg, J. “Managing the Transformation of Human Resources Work”
Copyright 2000 - South-Western College Publishing Module 3 - 7
New HR Paradigm
•Integrate Business and People Strategic Planning•Joint Responsibility to share effective human resource management learning•Leverage financial, technological, and human assets to create value, “Delight” customers and maximize employee satisfaction
Shared Accountability for Business Results and
Managing People
Human Resource Managers
Business Unit Managers
Source: Adapted from Conner, J. And Wirtenberg, J. “Managing the Transformation of Human Resources Work”
Copyright 2000 - South-Western College Publishing Module 3 - 8
HR Responsibilities and Objectives
• Purpose of the Human Resource Function: to design systems and policies to manage human assets in a way that enhances the individual and collective contribution of people to the short and long term success of the enterprise.
• HR Policy Clusters• Strategy & Organization
• Talent Identification and Deployment
• Human Capital Development
• Reward Management
• Employee Relations and Voice
Copyright 2000 - South-Western College Publishing Module 3 - 9
HR is at a Critical Historical Juncture
Time Period Primary HRStage
Key EnvironmentalPressure
Late 19th centuryU. S. IndustrialRevolution
Pre-PersonnelDept.
Market pressures,Immigration
Early 1900s-1930s
File DrawerMaintenance
Market pressures &WWI
1930s- 1960s UnionAvoidance/FunctionalSpecialization
Unions
1960s-1970s GovernmentAccountability
Government
1970s- 1990s StrategicBusiness Partner
Global MarketPressures
1990s- 2000+ Strategic Player:Adding Value
Global MarketPressures,TechnologicalChange
Copyright 2000 - South-Western College Publishing Module 3 - 10
HR Under Pressure• Most firms have not
completely switched to new HR paradigm
• HR strategies are important because they are malleable and affect human capital
• Key to differentiate between management of HR function Vs. HR management
• While orgs. cannot easily change firm assets, they can change how they manage people.
• HR practices can operate in 2 ways:
• increase value • lower human capital
investments
Copyright 2000 - South-Western College Publishing Module 3 - 11
HR Strategy Execution
• Ensure critical HR strategies and processes are aligned with critical to the business
• Provide insights that lead to developing/strengthening competitive advantage
• Work with line management to develop and implement practices
Copyright 2000 - South-Western College Publishing Module 3 - 12
Model for Understanding HR Strategy: Context, Roles, & Constraints
ENVIRONMENTAL CONTEXT
ORGANIZATIONAL BUSINESS
Managerial Discretion
(More Less)
Unilateral
Decisions
Negotiated
Decisions
Imposed
Decisions
Transaction
Translation
HR
Str
ateg
y
HR
Rol
es
Transition
ST
RA
TE
GY
Transformation
Copyright 2000 - South-Western College Publishing Module 3 - 13
HR Roles: The Four Ts
• Transaction– Routine HR
– Day to day operational processes
– Administrative Expert
• Translation– Day to day people
communication
– Promote employee commitment
– Facilitate open lines of
communication and feedback
• Transition– Execute firm strategy
– Integrate & Develop future HR practices and processes
• Transformation– Massive organizational
change role– New organizational cultures,
structures, work design to support major strategic business change
Copyright 2000 - South-Western College Publishing Module 3 - 14
Roles
Transitional
Transactional
Transformational
Translational
Copyright 2000 - South-Western College Publishing Module 3 - 15
Management HR Decision-Making Constraints/Choices
• Unilateral• Full management discretion or decision-making rights
• Negotiated• Jointly decided between employees and management or
labor and management
• Imposed• Out of firm’s control (e.g. legislation, critical customer
demands)
Copyright 2000 - South-Western College Publishing Module 3 - 16
Basic Organizational Criteria for Effective HR Delivery
• Roles and Choices Occur in All Policy Domains• Integrated Line-Staff Relationship& Delivery• Top Management Commitment to HR• Employee Relations Climate of Openness and
Respect• Ability to balance tensions in HR decision-making• Competent HR Department
Copyright 2000 - South-Western College Publishing Module 3 - 17
HR Competencies
• Masters of Global Operating Skills
• Business Experts
• Technology Leveragers
• Expert Communicators
• Employee Champions
• Change Managers
Copyright 2000 - South-Western College Publishing Module 3 - 18
HR Role Delivery: Current Trends
• Strategic Emphasis– Ford 2000 shift from mostly
transactional activities toward transformational emphasis (reengineering mix of activities and level of management and employee involvement
• Shared Services– Service centers: the consolidation
or combining of transaction services in an organization; (Example 1-800 HR)
• Transformation-Based/Centers of Excellence:– Non-routine & Non-
administrative HR activities that help transform a firm
– Outsourcing
Copyright 2000 - South-Western College Publishing Module 3 - 19
Service Center vs. Center of Expertise
Service Center Center of Expertise
Role Transactional Transformational
Work activity Reengineer Centralize Expertise
Successful if… Costs are reducedAll HR customers aresatisfied
HR practices helpaccomplish businessgoals
Copyright 2000 - South-Western College Publishing Module 3 - 20
HR Effectiveness: Contrasting Ways to Transfer Value
Stakeholder/Multiple Constituency: • Perceptions of customers
– HR should be Customer service-oriented
• Utility: Translate economic utility of HR practices through financial indices
– People and HR practices generate costs that should be managed
• Strategic: Practices impact a business’s ability to accomplish strategic goals
– HR practices should match business strategies
Copyright 2000 - South-Western College Publishing Module 3 - 21
High Performance Model
D em on s tra tes R esu ltsS ou g h t b y o th ers as resou rceU tilizes 'b es t p rac tices '
U ses H R E xp ertise
C u s tom er F ocu sed
B u s in ess P artn e r
S tra teg ic Th in k in g
R esu lts O rien ta tion
A ccou n tab ility fo rB u s in ess R esu lts
- In teg ra ted L in e S ta ff D e live ry-R esou rce A lloca to r
-M an ag in gIn te rp erson a lR e la tion sh ip s
-sp ec ia lized fu n c tion a l exp ertise
HR Leader HR Manager HR Specialist
Success Factors
Source: Adapted from Conner, J. And Wirtenberg, J. “Managing the Transformation of Human Resources Work”
Copyright 2000 - South-Western College Publishing Module 3 - 22
Application: Turnover of Key Staff Positions by Year
0%5%
10%15%20%25%30%35%40%45%50%
1995 1996 1997
Year
Pe
rce
nta
ge
Of
Tu
rno
ver
Consultant
Manager
Director
Copyright 2000 - South-Western College Publishing Module 3 - 23
Application: Contracts Not Renewed Due to Employee Turnover
$0$4,000,000$8,000,000
$12,000,000$16,000,000
1995 1996 1997
YearAcc
ou
nts
No
t R
en
ew
ed
A
ttri
bu
ted
To
Em
plo
yee
Tu
rno
ver
3 Year Contract
5 Year Contract
Copyright 2000 - South-Western College Publishing Module 3 - 24
Application: Answer Worksheet
Separation Costs
Copyright 2000 - South-Western College Publishing Module 3 - 25
Application: Answer WorksheetReplacement Costs
Copyright 2000 - South-Western College Publishing Module 3 - 26
Application: Answer Worksheet
Training Costs
Copyright 2000 - South-Western College Publishing Module 3 - 27
AT&T
Exhibit 1. Human Resource Guiding Objectives
The Vision: Create exciting and successful high-performing businesses where people are valued andvaluable.
The Objectives: Design, size, and staff each new company to meet its future business requirements and strengthen its
ability to compete successfully.
Oversee the equitable distribution of talent among the entities and discourage unilateral "talentraiding."
Retain critical skills and key talent throughout the transition.
Copyright 2000 - South-Western College Publishing Module 3 - 28
AT&T: New Practices
1. The assessment of talent within each support functionacross the company
2. The assignment of people to positions based on the skillrequirements and the needs of the new companies.
3. The determination of those who were going to be leftwithout job assignments within the new organization.
4. The design of appropriate career transition and employeesupport programs for all support staff.