Understanding HR objectives and strategies

Human resource management (HRM): making the best use of all employees to achieve corporate goals

HR objectives: targets the HR management hopes to achieve by implementing HR strategies, so that the business can achieve its corporate objectives.

based on the principle that employees are the most valuable asset of a firm and must be managed to yield maximum efficiency

Typical human resource objectives include:

·         Matching workforce skills to business needs

·         Matching workforce size to business needs

·         Matching workforce location to business needs

·         Minimising labour costs

·         Making full use of the workforce’s potential

·         Maintaining good employer-employee relations. 

·      Corporate objectives will always have an impact on the workforce. E.g. new skills may be required, employees may have to relocate or jobs may be lost as part of a rationalisation programme.

·      Production strategies will have an impact on the workforce: loss of jobs through a capital intensive strategy, new skill development for innovation, relocation or lean production needing teamwork training and improved communication skills

·      Marketing strategies such as product development and market development may have an impact on future recruitment and selection, as well as training for existing employees.

·      Financial strategies such as the introduction of profit centres, cost minimisation and the allocation of capital expenditure will influence the training programmes offered by a business. This could mean the training budget is cut or out sourced, or that the training and development programme is reviewed and adapted to changing needs. 

·      Market/economic changes-the plan might be to reduce workforce by natural wastage of voluntary redundancy. Workforce can also change with the buying habits of consumer- e.g. ecommerce.

·      Technological change- also the impact of new tech on motivation and how HR can address this

·      Competition for skilled employees can influence HR objectives, as may cause staff retention problems. May have to consider incentives

·      Population changes

·      Governmental (national and increasingly EU)

‘Soft’ HR management: concerned with communication and motivation. People are led rather than managed. They are involved in determining and realising strategic objectives.

Each member of staff will be seen as a long term investment opportunity with a personal training and development plan enabling them to achieve their potential.

Features-

• ·         Training and development opportunities
• ·         Internal promotion
• ·         Development appraisal systems
• ·         Consultation and empowerment
• ·         A flat organisational structure. 

Strengths

·         Reward systems are designed to encourage employees to be creative and work at a consistently high standard

·         Training, development and appraisal allow the employee to fulfil their individual needs as well as the needs of the organisation, which should lead to improved motivation

·         Recruitment costs should be reduced because retention rates should be high, labour turnover below average and absenteeism should not be a problem.

Weaknesses

·         role of trade unions is unclear and this could lead to tension where there is an established system of collective bargaining

·         Relies on an organisation culture which embraces a commitment to long term training and development and an acceptance of the need to delegate responsibility. May not be easy to implement, without time consuming and expensive training for senior management. 

‘Hard’ HR management: emphasises costs and places control firmly in the hands of management. Their role is to manage numbers effectively, keeping the workforce closely matched with requirement in terms of both bodies and behaviour.  

Features of ‘hard’ HRM include:

·         Fixed term contracts

·         External recruitment

·         Judgemental appraisal systems

·         Limited delegation of authority for decision making

·         A tall organisational structure

·         Minimum wage levels

Strengths

·         there are lower training and development costs

·         competitive advantage can be achieved through cost minimisation- lean production methods and minimum wages

·         reward systems are linked to output so it is possible to achieve a positive correlation between quantity produced and pay

Weaknesses

·         Little attention is paid to the needs of the employees. They are a resource to be used as necessary to achieve corporate objectives. Can lead to high labour turnover and absenteeism, which are costs.

·         Difficult to recruit new employees if the company has a reputation for ‘hiring and firing’.

·         Limited delegation and empowerment can demotivate employees and reduce quality.

·         tall organisational structure can cause communication problems, where bureaucracy slows down the decision making process.