The Changing Phase of Human Resource: A Strategic Shift
Published by MBA Skool Team, Published on June 17, 2013
“Human resources are like natural resources; they're often buried deep. You have to go looking for them; they're not just lying around on the surface. You have to create the circumstances where they show themselves.”
― Ken Robinson (English author, speaker, and international advisor on education)
And this is the evolution of human resource, unearthed to its fullest potential.
Human Resource, as we know it, is the procurement and eventual employment of workforce to achieve the set goals of an organization, it is raw, but when this resource is processed it becomes an asset for the organization, this asset is called Human Capital.
It takes into account the fact that the workforce is not just a means to achieving the goals of an organization but it is a form of wealth that can be invested to generate more and more wealth for an organization, the critical factors being experience, knowledge, skill and creativity. Experience enhances an individual’s exposure, thus giving him a basic understanding; knowledge keeps him better informed and thus helps him better and effective decision making; skill enhance his productivity whereas creativity inspires innovation.
When we talk about Human Resource Management, we refer to the practice of managing the workforce, to equip them for their job through training and development, to manage their performance and to take care of their requirements like compensation, rewards and recognition and career development. We spend time and money, just to best extract the benefits from this workforce in the most economical way, rather than developing and investing in their skills and competencies so that they become more effective.
Strategic shift is the need of the hour, be it in the functionality or the competency of Human Resource. Now, as we enter a new era, it is not the money or the material resources that distinguish an industry or give competitive advantage to any firm. Any firm can invest money into procurement and training, in order to achieve the most productive workforce, but what differentiates a firm is its ability to sustain that workforce to harness its knowledge, experience, skill and competencies and take the organization to new heights.
Strategic Hiring is necessary, where the applicant’s knowledge, skills and experience is mapped according to the company’s culture (mission, vision, objectives), along with the specific job requirement, such employee would turn the cost factor of HR into long term profitability and productivity. But sustaining a workforce is not an easy task, especially in an age where employee poaching is a reality, competing firms try their best to steal away some of the best and most ingenious employees of a firm. In such case only better compensation may not help a firm in sustaining its best employees; the need of the hour is to go beyond salaries and figures by valuing these employees. This can only be done when rather than treating the employee just as a means of achieving targets you treat the employee as an asset for the company, you value his knowledge and his creativity and give him a chance to excel and prove his mettle. It is a chance to develop human intellect, and further use this intellect as a capital for your own organization.
Credibility or Character is another characteristic that is desired off an employee these days; a high performing employee is not the only requirement of a firm, what they need is an employee who not only performs well but also projects some credibility through his commitment, ethics and a sound judgment. It is required that the employee is able to portray an acceptable conduct in the face of competition and extreme pressure. People may argue that character is inherent in an individual but we cannot ignore the merits of training an employee for such extreme conditions or supporting him/her during these tough phases. This requires that time be spent on an employee so he is molded and shaped for the organization.
One more question that perhaps can justify this evolution is that, ‘Why is Employer Branding such a rage these days?’ Organizations are spending huge amount of money on Employer branding exercises only and only because they have realized the importance of having the ideal workforce; they have started believing in the concept of Human Capital. The organizations realize that it is as important to invest in material resources equally important as to amass a highly intellectual and well functioning workforce, because not only is skilled and competent workforce a scarcity these days but it is also the biggest advantage that you can have over your competitor. So, organizations carry out various activities in order to establish themselves as a great employer in order to attract the best talent in the industry.
One such example is Godrej that recently came up with the concept of “Godrej Loud”; through this program, Godrej promotes the dreams of people by providing them a platform and resources to fulfill their dreams. This activity was carried across the top B-Schools in the country - which is the potential target market to attract future employees for Godrej. Loud helped Godrej in creating an image of a company that connects to an individual’s desires and knows the importance they hold in his/her life. Now why would one not like to work for such a company?
Employee Engagement is another such practice, for HR department in any company Employee Engagement is one major focus, a lot of time, money and organization’s resources are spent on it. Employee Engagement is one measure which helps in keeping the employees involved with their job and connected with the organization, by making them realize that the company cares about them and their family’s welfare. Every organization organizes some activities solely for this purpose; in some industries family of the workmen are invited by the organization for a fun-day while in some organizations employees are given a chance to learn and plan so as to develop their careers. Many organizations these days offer their employees a chance to go for an M.B.A. or higher studies, if they feel it is required for their progress in their career path. All these activities make an employee feel valued and he is able to see himself as an inseparable part of the organization and thus becomes concerned with its success and failure.
Another factor is Work-Life Balance, with increasing job stress and hectic work schedules; it has become the top most priority for everyone. Nowadays, work hours are increasing and many families have both the spouses working, so the time people get to spend with their families is reducing drastically and it becomes increasingly important that employees spend some time with their families. Keeping this in mind, many firms have now introduced a number of family-friendly policies so employees can get to spend quality time with their families; policies like flexi-time, paid maternity leave, child care facility are some of the examples.
All these practices have evolved over the years, with organizations aiming for better results and to give a rise to the economic value of the firm. They have realized that financial gains are tied to the productivity and hence the satisfaction of their employees, so it is extremely important to invest in your employees. This shift in ideology is not a matter of chance but a well planned effort on the part of the organizations to create a more cordial and mutually benefiting business environment. Thus, this evolution of Human Resource to Human Capital has been a strategic shift that seems to be paying off well for these organizations. This is because Human Resource holds a limited value but Human Capital is an infinite resource.
Now it is to be seen that what changes these organizations bring further so as to keep the wheel of progress rolling, will it be Human Development where the development of the society will be the primary concern?
The Article has been authored by Penaaz Gupta, MDI Gurgaon
Views expressed in the article are personal. The articles are for educational & academic purpose only, and have been uploaded by the MBA Skool Team.
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