2.1 Functions and evolution of HRM

How work patterns, practices and preferences change and how they affect the employer and employees (such as teleworking, flexitime, migration for work.)

The cause of changes in work patterns, practices and preferences.

Changes have occurred in the workplace.

These stem from social factors such as:

• Trends leading employees to desire a better work-life balance
• Privatization and moving away from public-sector employment
• Increased migration of worker
• Increased number of female workers
• Changing education opportunities - no longer do you have to be wealthy and such, there are many opportunities as you can even get a degree online.
• Increased urbanization and rise in stress levels - expansion into the city, people moving from the rural areas.
• Aging population and increasing average age of workforce - people are no longer having big families, so each person is hired for longer.

Changes in patters of work

• The types of jobs required by business.
• The types of jobs people want.

Top ten most sought after jobs in selected countries in 2013 have tended to be in the tertiary or quaternary sector.

Changes in work practices

Nature of work routines have changed as businesses respond to worker demands for flexible working practices.

Work practices in decline include:

•  full-time work
• permanent contracts

Decreased job security - the flexibility suits workers nowadays.

Work practices on the increase include:

• Part-time work
• Temporary work
• Freelance work
• Teleworking
• Homeworking
• Flexitime
• Casual Fridays
• Three-day weekend

Changes in work preferences

Employees are adapting their work routines to suit their changing lifestyles rather than continuously working for 20-30 years in the same position or business.

These could be in the form of:

• Career breaks
• Job share
• Downshifting
• Study leave

Outsourcing, offshoring and re-shoring as human resource strategies.

Outsourcing - cutting back on operations to focus on core activities, hiring subcontractors to complete projects so the business does not have to employ as many workers. This could be more cost effective.

• Offshoring - (A form of outsourcing) Outsourcing activities in a foreign country, outside its home country.
• Re-shoring - bringing core activities back to our home country (the opposite to offshoring)

Business functions which can be outsourced:

• Advertising agency (marketing)
• Production licensing (operations management) - get a producer to make your product for you.
• Employing an agency to headhunt potential staff (HR)
• Hiring accountants to run external audits (finance)

Force Field Analysis - Outsourcing and offshoring, is it worth it?

Driving Forces		Restraining Forces
Possible increased efficiency 4 Potential lower cost 4 Allows business to focus on core activities 3 Enables expansion to become more globalized 3 Possibility of higher quality products and services due to the use of experts and specialists 4 Increase employment in host country 3 Could provide innovation and new ideas 4 Favorable exchange rate could make product more price competitive. 2		Potentially more costly 4 Difficulty due to cultural differences and language barriers 3 Unethical to lay off workers 5 Slow decision making due to time differences 4 Bad reputation if redundancies are needed 5 Possible communication problems 3 Possible decrease in efficiency and core activities due to too many redundancy. 2 Potential for tougher rules and regulation in new countries increasing the costs. 2 Possible decline reputation if outsourced co. is unreliable. 4

How innovation, ethical considerations and cultural differences may influence human resource practices and strategies in an organization.

INNOVATION

A great strategic focus on HR over other functions is important to a business committed to being innovative (an innovative company like Google).

If it does not retain and recruit the right people, it cannot successfully innovate.

ETHICAL CONSIDERATIONS

HR planning has a strong connection to ethical behavior as HR plans are based upon relationships reflected by the way a company treats its employees. It is required by modern businesses to treat employees ethically.

What must be considered:

• Health and safety - is the working environment safe?
• Salaries and financial remuneration - are they getting paid enough to live?
• Performance appraisal -
• Right to privacy - are you giving them privacy?
• Layoffs and redundancy - how is it handled?
• Restructuring - how is it done ethically?
• Employment - are you being fair as to who gets the job?
• Discrimination - are all workers being treated fairly in terms of age, race and gender?

CULTURAL DIFFERENCES

Businesses that employ people from different cultures

• Individualism -
• Masculinity - ego
• Uncertainty avoidance - some cultures thrive to take risks while others will not want to
• Long-term orientation - different cultures have different values of loyalty
• Humor - some cultures value this, while others do not
• Personal space - some cultures want personal space
• Body language - how you sit or move
• Dress - some countries are more conservative
• Power distance - Hofstede's power distance index (PDI) -> employees from a society with high power distance do not need to be consulted and can be told what to do, while low power distance means that employees want to be consulted.