Human resource management-in-Construction-12-05-2017.pptx

Human resource management in construction

1. Human Resource Management in Construction Part 3 Dr Khurram Iqbal Ahmad Khan

2. HRM Theory: Strategic concepts and operational implications Introduction HRM: Definition and critical evaluation Strategic Human Resource Management (SHRM) Models of SHRM Operation and implementation of effective SHRM practices in construction Conclusion

3. Introduction Organisational success is dependent upon the effective management of people This includes the organisations HRM strategy which should seek to align HRM practices with the wider organisational practices Strategic HRM (SHRM) is introduced to examine the thinking underlying it and the impact it has on key operational issues concerned with implementing effective people-management practices

4. Introduction The application of theories of organisational behaviour to the context of people management in the last three decades has led to the development of various schools of thought These include personnel management, industrial relations (IR), HRM and more recently SHRM Personnel management role has been in existence since the industrial revolution where it fulfilled the welfare-officer role, supporting under-privileged factory workers through the provision of various benefits The personnel-management model dominated during the late 1970s and early 1980s, focusing on procedures and control, administration of employment contracts and job grades Despite a growing recognition that employee welfare was important to organisational effectiveness, the function had little strategic involvement until the late 1980s

5. Introduction During the 1980s organisations came to realise that people were a resource that needed proper management at a strategic level, and it was out of this realisation that the term ‘human resource management’, or HRM, emerged The role of human resource is more broader and complex than the personnel manager. It is considered as a core managerial function rather than a specialist support function

6. HRM : Definition and critical evaluation The 1990s witnessed a gradual redefinition of the HRM function from a personal welfare advisory role to a performance-driven core management activity The proponents of HRM contend that, whereas, personnel management is work force centred, and therefore directed at employees needs, HRM is resource centred, and therefore aimed at meeting managements human resource needs Storey (1993) takes this further by identifying four key aspects that categorise the differences between HRM and personnel management These concern beliefs and assumptions, strategic aspects, line management and key levers, and are sub-divided under 27 separate headings shown in Table 1 By placing people-management activities at the centre of organisational strategy, it raises the profile and importance of people and human resource managers as a key competitive resource for an organisation

7. HRM : Definition and critical evaluation HRM can be defined as; ‘A managerial perspective, with theoretical and prescriptive dimensions, which argues for the need to establish an integrated series of personnel policies consistent with organisation strategy, thus ensuring quality of working life, high commitment and performance from employees, and organisational effectiveness and competitive advantage’ (Huczynski and Buchanan 2001:673)

8. HRM : Definition and critical evaluation This definition acknowledges the need to bring together organisational and employee needs through the HRM function. It suggests that any failure to align these needs, which are often conflicting, will lead to a breakdown in employer + employee relations and hence will threaten the future growth of an organisation . Despite numerous studies into the nature of HRM and what it represents, it still remains a widely criticised and ambiguous concept Most importantly, its contribution to organisational performance remains unclear and is not well understood

9. No. Dimension Personnel Management and IR HRM (A) Beliefs and assumptions 1 Contract Careful delineation of written contracts Aim to go ‘beyond contract’ 2 Rules Importance of devising clear rules/mutuality ‘Can-so’ outlook; impatience with rule 3 Guide to management action Procedures ‘Business-need’ 4 Behaviour referent Norms/custom and practice Values/mission 5 Managerial task vis a vis labour Monitoring Nurturing 6 Nature of relations Pluralist (groups) Unitarist (individuals) 7 Conflict Institutionalised De-emphasised (B) Strategic aspects 8 Key relations Labour management Customer 9 Initiatives Piecemeal Integrated 10 Corporate plan Marginal to Central to (C) Line Management 12 Management role Transactional Transformational 13 Key managers Personnel/IR specialists General/business/line managers 14 Communication Indirect Direct 15 Standardisation High Low 16 Prized management skills Negotiation Facilitation Differences between HRM and personnel management Table 1 Key differences between HRM and personnel management

10. (D) Key levers 17 Selection Separate, marginal task Integrated, key task 18 Pay Job evaluation (fixed grades) Performance related 19 Conditions Separately negotiated Harmonisation 20 Labour-management Collective bargaining contracts Towards individual contracts 21 Thrust of relations with stewards Regularised through facilities and training Marginalised (with the exception of bargaining for change models) 22 Job categories and grades Many Few 23 Communication Restricted flow Increased flow 24 Job design Division of labour Team work 26 Conflict handling Reach temporary truces Manage climate and culture 27 Training and development Controlled access to courses Learning companies 28 Focuses of attention for interventions Personnel procedures Wide-ranging cultural, structural and personnel strategies Differences between HRM and personnel management Source: Storey (1993) ‘The take-up of human resource management by mainstream companies: key lessons from research’, The International Journal of Human Resource Management , Vol.4 (3), 529-53. Published by Taylor & Francis Ltd.

11. Strategic HRM One of the aspects that defines the transition from 'personnel' management to HRM is the need to integrate HR planning within the strategy of the organisation . Considering HRM as a strategic function rests on the belief that an organisation's human assets offer it a sustainable source of competitive advantage . Indeed , some take the radical view that SHRM offers organisations the main source of competitive advantage in the long term. Armstrong suggests that SHRM : is concerned with the development and implementation of people strategies which are integrated with corporate strategies and ensure that the culture, values and structure of the organisation and the quality , motivation and commitment of its members contribute fully to the achievement of its goals . ( Armstrong 1991: 81)

12. Strategic HRM SHRM comprises a set of practices designed to maximise organisational integration , employee commitment, flexibility and quality of work ( Guest 1987 ). It differs from traditional HRM in its emphasis on relationships between people, structures, strategy and the environment external to the organisation ( Fombrun et al. 1984). Adopting SHRM is a clear acknowledgement that corporate objectives and human resource objectives are inexorably linked, rather than in conflict.

13. Models of SHRM The Michigan Model of SHRM It approaches the SHRM function in a rather dispassionate manner, treating people like any other resource that should be managed in such a way as to maximise utility whilst minimising cost The Michigan Model emphasises the interaction of functional aspects of the SHRM role, such as selection, appraisal, rewards and development These must be linked to (or aligned with) the strategy of the organisation in order that SHRM practices support the strategic direction of the organisation It has been criticised as being limited in the context of modern organisations because it treats organisation as a closed system The Michigan Model of HRM

14. Models of SHRM The Harvard Model The Harvard School has made a major contribution to the development of SHRM by providing a useful open-systems model of how SHRM policy influences other organisational functions and is constrained by stakeholder interests and situational factors The ability to take account of situational and stakeholder interests is particularly important in construction projects, which employ a wide range of interest groups and often have a major impact upon the general public Harvard Model

15. Models of SHRM The Warwick Model The third important SHRM model is the Warwick Model. This model differs from the others, discussed in the previous slides, in reflecting European traditions and management styles. The model comprises five interrelated elements, which allow an analysis to be made of how external factors impact upon the internal operations of an organisation. The model recognises the wider context in which SHRM operates, and emphasises the full range of tasks and skills that define HRM as a strategic function. The main contribution of the Warwick Model is that it incorporates culture and business outputs into the SHRM framework. Each box within the model reflects a particular context within which the organisation operates and shows how strategic change impacts on the SHRM function. The Warwick Model

16. Operation and implementation of effective SHRM practices in construction There are few construction companies that take a truly long-term view and adopt SHRM policies, rather , they adopt fairly reactive approaches to staffing and managing people. Before exploring the ways in which construction companies should approach the SHRM function, it is necessary first to establish the various activities that are encompassed within it. These activities need not be within the domain of the human resource manager - the reality for many construction companies is that they will not employ such a person, and even when they do the vast majority of people-management tasks will still be devolved to line managers working in the project environment.

17. The achievement of SHRM priorities is dependent on an organisation creating the right structural and cultural conditions for them to take place. According to Mullins (1999), this involves: designing an effective organisation structure; staffing the structure with suitable people; managing the employment relationship effectively. Collectively, these should ensure the creation of positive and productive human relationships and high levels of motivation, commitment and morale . The challenge in each of these areas is to maintain a balance between organisational goals and the well-being of employees, as is discussed briefly below. Operation and implementation of effective SHRM practices in construction

18. Designing an effective organisation structure An effective SHRM policy can only take place within an effectively designed organisational structure. This can be viewed at two levels: the overall operation of the organisation in terms of how it manages and distributes work amongst various employee groups and functions in pursuance of the strategic goals; The design of the organisation in terms of the hierarchies, roles and relationships . Operation and implementation of effective SHRM practices in construction

19. Staffing the structure with suitable people This staffing function is also known as 'employee resourcing' and forms one of the most challenging aspects of the SHRM function The major components of employee resourcing are recruitment and selection, deployment and team formation, performance management, retention and training , career development, dismissal and redundancy (Taylor 1998) Employee resourcing activities aim to ensure that the right numbers of employees with the right skills and competencies are in the right place at the right time This inevitably results in a balancing act, in which managers have to consider longer-term strategic considerations while providing immediate solutions for the shorter-term operational issues ( Beardwell and Holden 1997) Thus , the resourcing function embodies much of what many people would traditionally consider as forming the core aspects of SHRM Operation and implementation of effective SHRM practices in construction

20. Managing the employment relationship It is clear from the preceding discussion that there is a need for the organisation to take great care in balancing organisational and individual employee needs if it is to successfully fulfil its strategic objectives However, a problem here is the trend amongst many modern businesses to devolve responsibility for operational aspects of SHRM to line managers. This is particularly the case in geographically dispersed project-based industries such as construction, where line managers have the responsibility for many of the day-to-day aspects of the SHRM function Operation and implementation of effective SHRM practices in construction

21. Conclusions The definition of HRM was discussed and was critically evaluated The concept of strategic HRM was discussed Different models of strategic HRM were discussed Operation and implementation of effective SHRM practices in construction was discussed

22. Thank You