Thesis Statement: Advances in technology along with shifts in the nations? social structure heavily impact the workplace environment, creating a need for new management models in Human Resources.
I.The Changing Workplace
A.An Historical Perspective of Jobs in America
B.Jobs in the 21st Century
II.Identifying Corporate Needs
A. The Emergence of Human Resource Management as a Component of General Management.
III.Developing Human Resource Policy
A. What HRM Professionals Have to Say
IV. Identifying Worker Needs
A.Family VS Work
B.The Working Environment
C.Benefits and Compensation
V.Where to From Here? – HRM Models for Innovation
A. Motivation Theory
B. Alternate Work Systems – a Comparrison Table
This paper is written from the perspective that Human Resource Management (HRM) practices are continually evolving to meet the changes of dynamic work environments. New technologies, increasingly rapid exchanges of information, social paradigm shifts and the restructuring of family systems contribute heavily to the need to find and apply methods of HRM that meet the needs of industry, workers and consumers. To do so effectively, vision and creativity are required in addition to on-going awareness of the bottom line.
The Changing Workplace
At the opening of the 20th century, the majority of jobs in America were held in two areas, agriculture and industry. Population distribution tables for that time demonstrate that most of the nation inhabited rural areas rather than urban areas. This continued to be the trend up until WWII, when men left the country to fight and women left rural America to fill factory jobs as their contribution to the war effort. This movement was the beginning of nationwide workplace and societal changes that have accelerated during the last half of the 20th century.
The move from rural to suburban environments changed the way we did business as a nation. Where extended families resided in and supported each other in culturally defined rural settings, nuclear families found themselves alone in homogenous neighborhoods. (1) This created a demand for goods and services that were formerly provided by extended family and community members, opening up new markets and creating jobs. It also created the need to recognize the management of workers as a separate and formal discipline.
As we move into the 21st century we can trace our nations? business growth over the last 100 years. We moved from an agrarian base to an industrial one. By the mid-50s? the majority of jobs were found in factories. Manufacturing suffered heavy blows during the late 60?s and early seventies and was displaced by the service industry. With the closing of the 20th century those services have become increasingly technological.
Surviving those changes requires adaptation, not only in the retooling of physical plants and the retraining workers, but also in the way we manage those workers. Some feel that there appears to be an underlying theme in books and papers on the subject of HRM, that there is only one correct way to manage people. (2) Maslow on Management offers a much different approach, demonstrating conclusively that one size does not fit all; i.e., that different people need to be managed differently.
HMR models operating on the assumption that there is a single right way to manage people are using workplace criteria that are quickly becoming a thing of the past. The ?one way? model views people working for an organization as employees who work full time and are solely dependent on that organization for their livelihood and their careers. These employees generally were viewed as subordinates with limited or very narrow skill sets. (3)
These images of the worker may have been valid several decades ago. However, today every one of these images has become insupportable. While the majority of people working for an organization may be classified as employees, a very large and steadily growing minority – by working for the organization – no longer work as employees, but instead as outsource contractors.
The concept of subordinate positions is fading as well, even in those areas that are considered fairly low level. As technology becomes increasingly more complex special knowledge is required in all operations. Subordinates, increasing their skill sets, become associates. The secretary, with knowledge of specialized software, becomes the Administrative Assistant. In order for the organization to run smoothly, the individual who does his job well, often has more knowledge about his job than his boss. (4) For example, the vice president of marketing may know a great deal about selling, but nothing about market research, pricing, packaging, service, or sales forecasting. Workers in these positions may report to the vice president, but are often experts in their own areas.
Identifying Corporate Needs.
Formerly, lower technological expectations and a firmly established hierarchy allowed general managers to delegate narrowly defined personnel responsibilities to those functioning as specialists. Today however, such practices would be inefficient to the point of being considered static, and must be replaced. To fail to do so would be to ignore and fail to address the many unprecedented pressures that demand a comprehensive and more strategic view in relation to the organizations? human resources.
From the view point of General Management, what does the organization need? The General Mangement picture of HRM is viewed from a global perspective, as demonstrated by a survey of Fortune 500 CEOs in 1989. The results of that survey determined that effective management of Human Resources must address corporate needs in the eight following areas:
1.Increasing international competition makes the need for greatly improved human production mandatory. The crisis experienced in both the automobile and steel industries serve as clear illustrations. Foreign management practices, particularly Japanese management models, are being used to guide developing HRM techniques, especially those that seem to increase employee commitment while providing companies with a long term source of workers with necessary competencies and skills.
2.As organizations increase in size and complexity layer upon layer of management has resulted in expensive, but not particularly effective, bureaucracies. Multiple layers of management also serve to isolate workers from the competitive environment in which organizations operate
as well as company policy makers. It?s hoped that a reduction of middle management layering will put workers closer to the competitive environment, fostering commitment to the organization as well as sharpening the competitive edge. Multinational companies have additional challenges in managing human resources, and need to adapt policies to work within diverse cultures and vastly different social values.
3.Some companies may face declining markets or slower growth, handicapping the organizations? ability to offer advancement opportunities and job security. How then to attract and retrain a competent and highly skilled work force?
4.Greater government involvement in human resource practices generates a need to re-examine HRM policies and mandates the development of new policies. For example, the Americans with Disabilities Act forced the revision of HRM policies in companies across the nation.
5.America?s workforce has become increasingly more educated making it necessary to rethink assumptions about employee capabilities and the delegation of responsibilities. Under utilization of employee talent is a major cause of workforce turnover.
6.Expectations and the values of the workforce are changing, particularly those values and expectations relative to authority. This fosters a need to reexamine how much involvement and influence workers should be given. Means of voicing employee concerns and addressing those concerns with due process need to be provided.
7.As workers become more concerned with life and career satisfaction corporations are revisiting traditional career paths and seeking more alternative career paths that take into consideration employee lifestyle needs.
8.Demographic shifts in the workforce, particularly the infusion of women and minorities into organizations, are causing corporations to reexamine all policies, practices and values that impact the treatment, responsibilities, and advancement of these groups. (5)
Developing Human Resource Policies
How do universal General Management issues affect HRM departments and practices? While narrower in scope than those concerns voiced by General Management, impact areas identified by HRM professionals closely mirrored major corporate needs identified by General Managers.
Human Resource professionals, in an effort to meet the needs of both worker and organization, have examined ways to ensure a desired working environment while increasing productivity. In the early 1990s, the advisory board of the Commerce Clearing House were asked to identify the issues that they felt would shape the role of human resource functions in the next decade. Commerce Clearing House advisory board members saw four main HRM areas where current issues would influence the role of the human resource function in the near future: compensation; communication and personnel practices; employment relations; and Equal Employment Opprtunity requirments. (6)
Compensation issues focused on the diversity of worker needs, pay-for-performance plans, and the regulation of employee benefit plans. Flexibility and adaptability in HRM practices are primary keys in addressing worker needs. Job sharing, staggered scheduling and flex time are some of the outcomes generated by creative approaches to HRM practices. Pay-for-performance plans hold the allure of rewarding productivity while providing monetary motivation. Successful implementation of such practices, however, require effective performance evaluations. To attempt such compensation without valid, reliable, and standard assessment instruments is to court litigation.
Fairness is a national concern strongly affecting human resource managers. Personnell plansfocused soley on organizational needs must be abandoned to benefit workers and organizations alike. One example is the growing social phenomena of two career couples. As the numbers increase nepotism policies must be reexamined. Managing change and preparing people for change also require HRM professionals to rethink policy. New demands for an increase in functions such as retraining evolve as workers move through change.
Training and professional development are crucial in all areas of operation. Even the lowest clerk needs to stay abreast of the latest innovations brought on by technical advancement. The march of technology, however, not only changes jobs, it makes some of them redundant or obsolete. In an era of company reconfiguration it becomes apparent that layoffs and divestirtures will occur when retraining isn’t an option. Outplacement policies must be considered and developed in preparation of the need. HRM professionals also understand the need for the development of effective HR auditing instruments to measure employee perceptions of management fairness and the climate for effective communication within the company. The information obtained by employee attitude surveys can be greatly beneficial to supervisors, but only if they’ve been trained to use it. (7)
The legal environment of personnell management is many fingered and quite comprehensive. In addition to regulations stemming from the Occupational Safety and Health Act (OSHA), passed in 1970, HRM is greatly affected by the broad umbrella of Equal Employment Opportunity (EEO) regulation. As well as protecting workers form discrimination based on race, color, or creed, EEO serves workers in many other areas. Age discrimination also falls under this umbrella. With an increasing number of age discrimination suits, organizations need to develp a sensitvity to age issues and policy specific to older employees.
A recent off shoot of EEO is the American with Disablities Act (ADA). ADA has created a need for new policies and procedures in accommidating employees with handicaps and disabilities. The emerging legal view that Acquired Immune Deficiancy Syndrome (AIDS) is a handicap brings policy questions about AIDS testing to the forefront. There is great potential for conflict in providing for the needs of other employees and creates an HRM channel that must be carefully navigated.
Benefit plans that are regulated by the Employee Retirement Income Security Act (ERISA) require special attention. Companies must be prepared to provide resources that not only offer such plans but also impeccably manage those employee benefit plans. Failure to do so will lead to subsequent suits by employees challenging plans that are out of compliance with ERISA disclosure, reporting and fiduciary standards are problematic.
Governemnt regulation is also partly responsible for shifting attention from union group representation to regulations and policies that emphasize the rights of individual employees. It is mandatory that this factor be taken into consideration in personnel planning and policy making. The role of unions as bargaining units is on the decline and will continue to diminish as bargaining relationships become increasingly stable. This translates to decreased strike activity and fewer actions filed with the National Labor Relations Board (NLRB). While that is a positive outcome the trade-off must be recognized, prepared and accounted for. While businesses will see fewer strikes, they can expect to see increasing numbers of employment-at-will and wrongful discharge suits. An additional considertion affects employers who contract temporary employees. This practice is experiencing an increasing number of suits by temporary employees alleging unlawful activity. This surely influences staffing policy decisions.
It should come as no surprise that such pressures have created the need for a greater emphasis on the human aspect of business. With something so seemingly obvious the qustion is why hasn’t this human aspect been addressed before? It may be due, in part, to the tendency to educate, develop, and train managers to fixate on analytical and technical aspects while assuming that ?business as usual? in dealing with employees was sufficient to promote productivity.
So why are companies now hoping to find solutions to business problems in the human side of enterprise? The answer lies in part to growing societal pressures. Concern over the condition of blue-color jobs in the 1930s, as well as civil rights and equal opportunity legislation in the 1960s and 1970s, has paved the way to revamping HRM policies to recognize and respond to shifting social values. More simply put, other approaches to improve employee productivity and organizational effectiveness haven?t worked. (9)
Identifying Worker Needs
The area of single most impact on worker performance lies outside of the work environment. Family needs are the primary cause of absenteeism, tardiness, and lower productivity. (9) The here are several factors creating this phenomena. First there is the steady flow of women into the work place. In 1970, 20.2% of women worked outside the home. That figure grew to 73.8% in 1995. The increase in two career couples has assisted families in reaching financial stability and filled a need for personal satisfaction. It has also, however, created a void in care giving that was traditionally a woman?s role. Another major cause of family issues impact is the increasing number of single parent homes. Single parent homes have grown from 12% in 1970 to 49.8 % in 1995. (10) As the sole burden of child rearing is placed on a worker, childcare arrangements, school obligations, and childhood illnesses are far more likely to interfere with attendance and productivity.
Another social phenomenon, which strains workers and, in turn, disrupts the workplace, is increasing longevity. As the population grows older the phenomena of living longer allows workers the luxury of postponing marriage and having children. It?s relatively common today for couples to postpone their first child until their late thirties or early forties, a time formerly used for the preparation of an empty nest. Instead of retiring to grandparenthood these later in life parents are dealing with teenagers and how to get them through college. A large percentage of the workforce now finds itself in the position of not only having children to care for, but elderly parents as well. Add to the list of family pressures the moral and financial obligation workers must contend with in providing for the wellbeing of two generations. The American worker is now faced with a double whammy in the attempt to meet family needs.
When looking at the increasing longevity of the workforce, one must consider that piece of the big picture which has to do with the rate that people retire. It?s estimated that within the next twenty to thirty years the retirement age in developed countries will, by necessity, move up to seventy-nine or so. Seventy-nine, in terms of health and life expectancy, correlates with the age of sixty-five and the health and life expectancies of 1936, when the United States, the last western country to do so, adopted a national retirement plan (Social Security). (11) As America continues to gray, a significant percentage of the work force will develop unprecedented needs that are geriatric in nature, impacting worker expectations of benefit packages.
The question facing business in the future is determining what that age and experience are worth in terms of monetary compensation and benefits. This is a dilemma currently being faced by the Armed Forces, with many branches finding themselves to be top heavy with senior officers. The funding resources dedicated to personnel are not distributed in a fashion that attracts and retains military members, seriously jeopardizing the productivity of military organizations. (12) This is relevant in that many private organizations as well as public and government agencies are finding themselves in the same position. Retirement Incentive bonuses have become common place and are a primary tool used by organizations to cull the workforce. Will this remain a viable means of thinning an aging workforce?
In addition to family pressures, and salary and benefits needs, there is a growing concern throughout the nation?s work force concerning quality of life. While benefits and compensation are key to employee satisfaction, and therefore productivity, a strong value is placed on the emotional satisfaction one finds professionally. These emotional perks come out of all areas, and are as solid as additional training and added responsibility or as intangible as recognition, appreciation, and creativity. (13) Business must take into account the social implications of such information, as it becomes essential to address staff needs and to determine successful strategies that should surround any HRM policy.
New HRM Models
The management of human resources centers on a single basic function of the management process: staffing. The HRM professional is charged with matching the right person to the job. While recruitment is an exacting area of HRM, a more significant piece of employee productivity lies in motivation. Motivation methods are key to fashoning successful HRM models. Motivation is a deceptively simple concept but probably one of the most complex components of human resource management.
Motivation is simple in terms of human behavior. People are basically motivated or driven to behave in ways that they find rewarding. So the task seems easy; just find out what they want and hold it out as a possible reward or incentive. It becomes complex when trying to find a universal incentive in a very diverse workforce. What has value to worker A may be meaningless to worker B. And what has value at one point in time may become insignificant at another. For example, everyone has a need to eat. A big steak dinner, as an incentive to succesful completion of a task, is motivation – as long as your hungry! Had you just eaten, a steak dinner would hold no interest .
An additional factor in the motivation equation has to do with the reality of obtaining the reward. Telling a person that they will be promoted to sales manager if sales in that jurisdiction increase is empty if that task is percevied as virtually inpossible. Two conditions must be met for motivation to occur, according to Vroom’s expectancy theory of motivation. First the value of the particular outcome (such as recieving a promotion) is very high for the person and, secondly, the person feels that there is a reasonably good chance of accomplishing the task at hand and obtaining the outcome. This is the process of motivation. (14)
Theories of motivation center on a a single basic question: what do people want? Abraham Maslow states that humans have five basic categories of need; physiological, safety, social, ego, and self-actualization. These needs have been arranged in order of there importance to humans. When the basic physiological needs, food, drink, etc., are met, they no longer serve as motivation. Instead, those urges toward safety, i.e., protection and security, become the driving force. Human beings move up this needs ladder as basic needs are met.
Frederick Herzberg has divided Maslow’s hierarchy into two planes, the lower meeting physiological, safety and social needs, and the higher meeting those needs surrounding ego and self actualization. Herzberg believes that the best motivation lies in satisfying those higher level needs. Based on his studies, Herzberg believes that factors that satisfy lower level needs, which he identifies as hygiene factors, are markedly different from those, reffered to as motivators, that satisfy higher level needs. Herzberg states that if hygeine factors are inadequate workers will become disgruntled, but once satisfied there is no incentive to perform. Therefore, hygiene factors are necesary for preventing dissatisfaction, but very inefficient in encouraging motivation.
Job content, however is the source of motivating factors. Opportunities for achievement, recognition, responsibility, and more challenging jobs motivate employees. Motivating factors work because they appeal to higher level needs that are never completly satisfied. According to Herzberg, the best way to motivate employees is to build challenge and opportunities for achievement into their jobs. Herzberg reffers to this method of applying his theory as job enrichment. Basically, job enrichment consists of building motivators like opportunity for achievment into the job by making it more interesting and challenging.
This theory restructures more traditional HMR models since job enrichment is often accomplished by giving workers more autonomyand allowing them to do more of the planning and inspection normally done by
a supervisor. This is diametricaly opposed to strict hierarchal models.
The shifts made in HRM practices can be most easily observed in the accompanying table comparing traditional and innovative HRM models.
Alternate Work Systems Table
Traditional Model High-Committement Model
Narrowly defined jobsBroadly defined jobs
Specialization of workersRotation through jobs
Pay by specific job contentPay by skills mastered
Closely supervised workSelf or peer supervision
Assignment or transfers byTeam assigns members to
the rule bookcover demands in flexible fashion
No career developmentPromotion of learning and growth
Employees as individual partsEmployees in a team
Employee kept ignorant aboutTeam runs as a business:
businessdata is widely shared
Status symbols used to Status differences
No employee feedbackBroad employee participation
It seems apparent that HMR practices have evolved to more worker friendly models out of necessity. Studies have found that use of specific practices, or what are more commonly reffered to as "high performance work practices" enhances overall organizational practices. It was determined in a 1995 study that extensive recruitment and training procedures, incentive compensation and increased employe involvment are assosciated with lower levels of turnover, higher productivity, and better financial performance.
With regard to identifying the ideal HR systemfor innovation, it may be that such a definitive HR model would be to rigid for the innovative organization and it’s constantly changing needs. A flexible combination of traditional and high-commitment practices, and others found to be contingent on a strategy of innovation, may be what organizations need to remain successfully competative.
1.H. Stephen Glenn, Developing Capable People
(Rockland CA: Prima Press 1989) 14-21
2.Martin Isenberg, "A Short History of Human Resource Management," Strategic Human Resource Management Readings, (January 1994) University of Massachusetts Press, 97
3.Peter F. Drucker, Management Challenges for the 21st Century, (New York: Harper-Collins, 1999) 17
5.Beer, Spector, Lawrence,Mills,Walton, Managing Human Assets ( London: Collier Macmillan, 1984) 49-55
6.Gary Dessler, Personnel Management, 4th Edition, (New Jersey: Prentice Hall, 1988) 706
7. Dessler, 323
9.R.P. Kalleberg, Social Perspectives on Labor Markets, (New York: Academic Press, 1991) 119-149
10.US Bureau of Statistics Data Base, http://www.stats.gov.public
12.Jan Nybor, "More Than a Few Good Men" Navy Times, 14 Sept. 1994, 16
14.Victor H. Vroom, Work and Motivation, (New York: Wiley, 1964) 350-367
15.Fredrick Herzberg, "One More Time: How Do You Motivate Your Employees?" Harvard Business Review, vol. 47 Jan-Feb. 1968
16.Pritchard, DeLao, Von Bergen, "A field Test of Expectancy – Valence Incentive Motivation Techniques," Organizational Behavior and Human Performance, vol. 15 no.2 April 1976 111
18.Beer, et al, 165-167
19.Tushman and O’Reilly, Winning Through Innovation, (Boston: Harvard Business School Press, 1997) 299
Nybor, Jan.Navy Times, 14 Sept. 1994
Pritchard, DeLao, Von Bergen, "A Feild Test of Expectancy – Valence Incentive Motivation Techniques," Organizational Behavior and Human Performance vol.15
Herzberg, Fredrick, "One More Time: How Do You Motivate Your Employees?" Harvard Business Review vol. 47
US Bureau of Statistics Data Base
Glenn, H. Stephen, Developing Capable People, Rockland CA: Prima Press 1989
Isenberg, Martin "A Short History of Human Resource Management," Strategic Human Resource Management Readings, (January 1994) University of Massachusetts Press
Drucker, Peter F., Management Challenges for the 21st Century, New York: Harper-Collins, 1999
Dessler, Gary, Personnel Management, 4th Edition, New Jersey: Prentice Hall, 1988
Kalleberg, R.P. Social Perspectives on Labor Markets, New York: Academic Press, 1991
Vroom, Victor H. Work and Motivation, New York: Wiley, 1964
Tushman & O’Rielly, Winning Through Innovation, Boston: Harvard Business School Press, 1997