Chapter 16 - Human Resources Management Strategy
Learning Objective: Strategies for improving workforce performance; the use of technology in HRM
Now that you fully understand the different methods of measuring employee performance (productivity, absenteeism, wastage rates, rejection rates, consumer complaints, performance vs. targets), let's go on further in the issue and discuss strategies for improving employee performance.
The main reason for poor employee performance has to do with motivation. To deal with that there are hard and soft approaches.
Hard Strategies to improve performance:
- Based on warnings and discipline;
- It might deal with poor performance with dismissal;
- Such strategies are of low short-term costs to the company;
- Training and developing employees is costly;
- Such approach can further lower workers' motivation;
- It can worsen performance.
Soft Strategies to improve performance are based on the belief that employees are resources to be nurtured and developed.
Such strategies are usually high-cost but likely to increase motivation, reduce absenteeism, wastage, and improve quality.
Such approaches include:
Setting targets and conducting regular appraisals is a way to track and improve performance overtime (MBO);
Trainings to increase efficiency;
Quality Circles so that workers can identify and suggest improvements to work-related problems;
Autonomous working groups, which are responsible for an entire section of the work providing employees with a diverse range of tasks;
Financial incentives linked to the business performance (e.g. profit sharing, stock options) can be a great way to increase productivity;
Investment in technology can also increase productivity - on the flip side it may require training and lead to redundancies.
Activity 16.5
As you can see, MBO is one of the strategies for increasing productivity - it is a system to motivate and coordinate the workforce by dividing the company's overall aim into specific targets for each division, department, and individual.
For MBO to be successful is of extreme importance that all of the workers involved in a certain objective are part of the goal setting process as well its appraisal (job enrichment, Theory Y). MBO is a great tool for delegating authority and motivating.
MBO targets are set annually during an appraisal process. The targets should be agreed amongst managers and workers themselves for maximum effect.
First and foremost MBO clarifies to managers and subordinates their priorities for time allocation. Along the same lines, MBO is also useful for employees to visualize the importance of their individual work within the entire organization;
MBO is an important tool for avoiding conflicts and ensuring consistency as all workers, departments, and divisions have separate tasks that are complementary and towards the same main goal;
Finally, MBO makes it easier for monitoring and measuring failures and successes.
MBO does not come without its challenges, though:
The process of dividing corporate objectives into divisional, departmental, and individual levels is very time-consuming;
Objectives can become outdated/change very quickly and therefore can become useless (depending on economic or competitive environment);
MBO does not guarantee success alone (appropriate resources, training, motivation should be in place).
Finally, let's discuss how IT and AI are, nowadays, playing an important role on HRM.
Some IT resources have been used for a long time in HRM:
Keeping employee records on database;
Planning software to make work schedules available and clear to all workers;
Holiday planning software for workers to choose from available dates.
There are, however, recent developments in this area in relationship with HRM:
Recruitment has mostly become web based with employers and employees being able to find and connect with each other remotely and easily;
Training and development can partially be held online nowadays (e.g. induction training) making it possible for demonstrations and even assessment to take place as well as convenient to be accessed whenever needed;
Employee performance management software to track and assess productivity and performance of workers aiding on leveraging such metrics as implemented.
There are even more 'futuristic' developments towards HRM with IT and AI progress:
- AI can be used to interview, go through job applications quickly and with no bias;
- Chatbots are being used to provide information to employees timely (e.g. holidays, pay, benefits, etc.);
- VR is currently being used for training purposes (e.g. cabin crews emergency);
- Biometric markers for time-tracking and access/denial of assets (e.g. computers) and other business assets (e.g. buildings).
At A Level you will not be asked detailed questions about IT software or AI applications. You should be aware of the potential these developments might have to HRM. In particular, you should be prepared to evaluate the benefits and limitations of these development.
Evaluation of IT and AI Uses on HRM:
The use of such resources frees-up HRM time for strategic decisions;
They can make HR managers seem remote as it reduces social and personal contact between HR personnel and the workforce;
Such technology might reduce two-way communication;
It can create a negative sense of 'being monitored' and distrust amongst employees.
Chapter 16 - Human Resources Management Strategy
To-Do-List: Exam-Style Question #2 - Human Resources Crisis in the Theatre Lighting (TL) Factory
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