Strategic human resource management - Essay Example

? xxxx xxxx xxxx xxxx Introduction: Strategic human resource management (SHRM) is a field of HR that highlights how the human resource of the organization contributes to the attainment of the desired goals by means of various HR strategies, policies and practices. This approach considers human resource as the primary factor contributing to the success of the organization. It is as Leif Edvinsson (2002) puts it: “The only vital value an enterprise has is the experience, skills, innovativeness and insights of its people” (12 Manage). In addition to that, it is of the view that the success of any organization is actually dependent on the factor of best fit between the business strategies and its human resource strategies (Armstrong, p. 33). SHRM constitutes a mindset based on certain concepts rather than a set of techniques. It revolves around three primary propositions, which are as follows: The human capital of all the organizations is a primary asset, which when put to effective use, plays a strategic role in its success and can be a major source of competitive advantage for the organization. The human resource strategies should be in perfect alignment to the business level strategies of the organization and its mission and vision. The human resource strategies at individual level should be coherent and should be designed in a manner that they provide a mutual support (Armstrong, p. 34). This paper aims to shed light on the factor of Strategic human resource management in view of the airlines industry, which have been subject to a deluge of turmoil over the past few years. In the light of the various economical crises, the situation has not only changed on the customer side of the picture, but it has had a huge impact on the industrial level as well. The organizations all over the world are in a state of struggle to keep with the needs and wants of the customer. This in turn, pushes the organizations to make their internal functions all the more effective and efficient and requires them to not only be vigilant in their resource deployments and other such major strategies, but also in effectively managing their workforce. This whole study would be done with reference to the Canadian Airline established in 1987, which later ceased its operation in 2000 and was merged with Air Canada. Issues in the Airline Industry: An airline is an industry that is highly sensitive to economical changes. Such changes not only impact the productivity side of the industry, but also influence the side of the consumer, in turn affecting the profitability of organizations working in this industry. The industry can be observed on a continuous cycle of gigantic profits and mammoth losses. A few of the factors having a direct influence on the airlines industry are given as follows: Recession: The airline industry gets highly affected by the downturns in the economical circle owing to the fact that in such a scenario, the business travel that can also be constituted as the bread and butter of the airline industry gets cut down when the economy is facing a slump. The lengthy global recession of the past few years has now turned into the single biggest challenge being faced by the airlines industry. This has resulted in weak revenues and air travel (Reals, 2008). Soaring Fuel Prices: The industry that is getting most affected by the hike in the oil prices is the airline industry. It has now turned into a tedious task for the airlines to cope up with such colossal fuel prices that are so intense that they are even pushing several airlines to bankruptcy. Those that do continue to operate in such unsteady conditions are having to face immense financial burden along with thinning profit margins in these pricey fuel times (Fleming, 2011). Terrorist Attacks: The 9/11 attack on the world trade centre and the global conditions that followed served as a serious blow to the airline industry, which was having to through a tough time due to the factor of recession even before the attack. This event resulted in compounded financial problems for the industry (Makinen 2002, p.4). Deep Pocketed New Comers: In view of the rising prices of the commodities all around due the crisis situation facing the economical world today, even the consumers have to keep a vigilant control over their spending, as the real value of money is declining. This has resulted in a situation where people try to keep a hold on their pockets as much as they can, as a result of which people are trying to avoid travelling; consequently reducing the profit margin of the airline industry as well. Environmental Hazards: The increasing awareness of the public has resulted in the increasing responsibility for the industries all around to be more environmental friendly or try to be so. This has resulted not only in the need for the organizations to be responsive to the environmental concerns such as fewer emissions but also in terms of trying to incorporate more fuel efficient technologies and means (Commercial Aviation Report, 2007). Striking Workers (loss of employee engagement): The labour relations can be seen to be in a state of transition over the past two decades in the industry. Decrease in the government regulations, more competition, increased carrier strength owing to the mergers and acquisitions and changing sentiment of the employees along with the general public towards the unions have had quite a drastic impact on the labour relations when it comes to the airline industry; posing all the more challenge to it. Integration of Theory and Practice: In view of all the issues being faced by the airline industry, it has become not only vital but also crucial for the airlines to stream line all their operations, an important aspect of which is to have a workforce that is strong and efficient, as well as effective. The reason that the Canadian Airlines could not survive is because the organization was incompetent in their planning and business ventures and was unable to keep up with the market trends. In the same light, when a company is faced with situations, as was faced with Canadian Airline that led to its downfall, we see that it also impacts the level of employee engagement. When the company loses track of its mission and goals, then in turn, the workforce also gets disoriented. The human resources are rendered useless, as they are then just trying to get through the situation at hand, and do not contribute to the best of their abilities to the performance of the firm. When the company is in turmoil and is faced with uncertain future prospects, the employees get highly de-motivated by it. Every individual desires to work in a stable environment of an organization that is on its way to thriving and reaching new milestones. It is in fact the factor of effective human resource management that serves as a fine thread between various organizational structures, which aligns them to move forward. When the factor of human resource itself is not maintained, then complex implications become inevitable, as was the case with Canadian Airline. In such a scenario the organization loses its focus and direction and hence, fails to define empirical objectives. When the employees are de-motivated in the organization, the level of employee engagement also falls. In other words, they tend to get less productive. The whole purpose of strategic human resource management is to work opposite exactly that factor i-e in building the level of employee engagement so as to maximize the level of productivity. But this factor of human resource can hardly be capitalized upon when it comes to organizations that have reached a block, having faced failure on various levels time and again. The organizations such as Canadian Airlines, that fail to thrive of industrial level, in turn also fail to provide thriving opportunities to its employees. In this new millennium the work philosophy of the of the working people have turned as such that they now want challenging jobs that further provide doors for better opportunities like promotions and other incentives etc. But organizations that are facing a hard time, also fail to fulfil that requirement of their employees. The organizations of today require a workforce that is better educated, mobile and also multi skilled. When the requirement criteria has gone to the point that the organizations now demand highly competent workforce, then on the other hand, the demands and expectations of the workforce have also risen. The employees now desire and are most influenced by the factors of job satisfaction, participation, involvement and incentives etc. other than just the economical factors (Accel Team Development, 2011). As the US psychologist Frederick Herzberg (2000) puts it: “True motivation comes from achievement, personal development, job satisfaction and recognition” (12 Manage). When the organization fails to comply on any of these levels then it leads to dissatisfaction among the employees, which when aggravated, can even lead to labour strikes. In such a case, the employees refuse to come to work as a protest to get their demands fulfilled. With the absence of the workforce, the business also comes to a standstill. Due to the inability of its operations to function without the workforce, the organization stops making money, with still having to cater to all the overheads of taxes, rent, maintenance and bills etc. Longer the period of strike, more the losses for the organization. On the other hand, taking a stand against the organization that they work for, the employees also suffer a great deal as they don’t get paid, so they are also losing money (Grabianowski, 2011). In order to avoid such a scenario, the organization’s first priority should be to keep the workforce happy and satisfied. For this purpose, the field of strategic human resource management suggests various actions that can greatly contribute to the level of employee engagement and satisfaction. A few of these are given as follows: Reward Management: This branch of human resource management refers to the formulation and implementation of strategies that aim to provide the employees in a fair, equitable and consistent manner in accordance with their contribution and value to the organization. Its primary function is to design, implement and maintain the reward processes, policies and practices for the purpose of achievement of the organizational goals through the effective contribution of its workforce (Armstrong, Murlis & Group 2007, p.3). Needs-Driven Approach: Strategic human resource management is an approach of managing people that is based on the assumptions of unitarism, along with having emphasis on individual focus. It is the needs and requirements of the business and/or the organization that determines the role of human resource management. In other words, the human resource management of every organization differ in a manner that some require the factors of commitment and loyalty from their workforce, while others’ primary focus is on the factor of performance. Hence, every organization defines its human resource functions in accordance to its needs (Heerey & Noon 2001, p. 164). Involvement and Trust: In the light of what Robert Shapiro, CEO of Monsanta, says in the Harvard Business Review (1997), “If an institution wants to be adaptive, it has to let go of some control and trust that people will work on the right things in the right way” (12 Manage). The factor of trust has proved to be an important aspect in human resource management in terms of being a key to organizational success. All processes of organizational change these days validate the importance of incorporating the factor of trust in their employees in the processes. Even the term of employee empowerment can be said to be an extension of this very factor (Morgan & Zeefan 2003, p. 55). Recommendations and Barriers to Strategic Human Resource Management of Airline Industry: In order to make the airline deal with the increasing employee concerns in terms of strikes activity and service level problems, it is suggested that the airline should incorporate the factor of reward management in their processes. Financial, psychological and even the physiological rewards offered by the organization in a consistent manner greatly contribute in retaining good staff and boosting their encouragement (Accel Team Development, 2011). Good personnel policies are highly recommended when it comes to the staffing needs, in turn contributing to the organization’s productivity. In view of all the challenges being faced by the airline industry, a good and strong hold on the workforce is required in order to sustain in such crucial times. Such a strong workforce can only be sustained and maintained by keeping the employees happy and satisfied with their jobs. In view of the competent and challenging jobs of this industry, the studies of social science over the recent years pay testimony to the fact that money alone is not the sole motivators of employees these days. The factors of job satisfaction, involvement, achievement and participation are more important boosting factors of the employee self-esteem. When it comes to incorporating new approaches to strategic human resource, even if it is in favour of the workforce, there are certain barriers that the organization has to face. Such resistance includes the resistance to change from the bottom line workers. Other than that, the whole policy could be rendered useless if the criteria and requirements of it are not effectively communicated to the employees. There could also be a conflict among the departments in relation to the policies being implemented. Plus, the factor of diversity, that is so much prevalent in all the organizational structures these days due to globalization, can also present to be a barrier to the effective implementation of new strategic human resource strategies. This could happen due to the discrepancies in the requirements and expectations of the employees belonging to various cultures. Last but not the least, the airline could also be faced with increasing challenges to the change in market scenarios as it can out increasing pressure on the organization. In the dynamic environment that the airlines now have to operate in, effective implementation of strategic human resource management can exert pressure from various facets (Nakate, 2011). Conclusion: In view of the study undertaken, we see that the airline industry has to deal with increasing pressure from various facets in today’s dynamic environment. In addition to that, it is also faced with various challenges both from an internal and external perspective. These challenges and pressures not only pose a threat to the functioning of the industry players, but also challenges their ability to streamline all their operations in a manner that reinforce their organizational strategy into contributing to organizational success. In order to sustain the survival and growth in such dynamic and uncertain environments, it is vital for the players to incorporate the factor of employee dedication and build upon their performance levels. For this purpose, the organizations can employ various approaches to strategic human resource management; the most effective of which is the factor of rewards management. This is due to the fact that it not only boosts motivation among the employees, but also gives them a feeling of achievement and involvement in the organizational structure. Hence, when the workforce of an organization is satisfied with its processes, then the threat of unions and strikes on part of the workforce is eliminated to quite an extent. Reference List: 1. Accel Team Development, 2011, Human Resource Management: Employee Motivation, viewed on 10th April, 2011 from http://www.accel-team.com/human_resources/hrm_03.html 2. Armstrong, M 2008, Strategic Human Resource Management: A Guide to Action, 4th edn, Kogan Page Publishers, London. 3. Armstrong, M, Hay, G & Murlis, H 2007, Reward Management: A handbook of Remuneration Strategy and Practice, 5th edn, Kogan Page Publishers, London. 4. Commercial Aviation Report 2007, Airline Industry Grapples with Increasing Environmental Concerns, viewed on 10th April, 2011 from http://www.leeham.net/filelib/091007CAR.pdf 5. Fleming, A 2011, The Soaring Costs of Fuel and its Impact, About. Com, viewed on 9th April, 2011 from http://airtravel.about.com/od/airlines/a/aafuelcosts.htm 6. Gabrianowski, E 2011, Strikes and Unions, How Stuff Works, viewed on 10th April, 2011 from http://money.howstuffworks.com/strike1.htm 7. Heerey, E & Noon, M 2001, A Dictionary of Human Resource Management, Oxford University Press, New York. 8. Makinen, G 2002, The Economic Effects of 9/11: A Retrospective Assessment, Report for Congress, viewed 10th April, 2011 from http://www.fas.org/irp/crs/RL31617.pdf 9. Morgan, D & Zeffane, R 2003, ‘Employee Involvement, Organizational Change and Trust in Management’, The International Journal of Human Resource Management, vol. 14, no. 1, pp. 55-75. 10. Nakate, S 2011, Strategic Human Resource Management, Buzzle.com, viewed on 10th April, 2011 from http://www.buzzle.com/articles/strategic-human-resource-management.html 11. Reals, K 2008, Recession Single Biggest Threat to Airline Industry, Flight Global, viewed on 10th April, 2011 from http://www.flightglobal.com/articles/2008/12/09/319908/recession-single-biggest-threat-to-airline-industry.html 12. 12 Manage, HRM Quotes, viewed on 10th April, 2011 from http://www.12manage.com/quotes_hr.html Read More