Importance of Human Resource Management in 21st Century

Assignment
ON
Importance of Human Resource Management in 21st
Century
SUBMITTED TO
MR. SALMAN SALEM SHINWARY
Assistant Professor, SoB, AUST
Course Instructor
Fundamentals of HRM (MBA- 641)
School of Business, Aust
SUBMITTED BY
Name Program ID
Khondoker Amin Uzzaman MBA 15-02-51-002
MD. SUMON KHAN MBA 13-02-51-021
MD. Ali Hossain MBA 13-02-51-010
Date of Submission: 11 February 2016
School of Business, Aust
AHSANULLAH UNIVERSITY
O F S C I E N C E & T E C H N O L O G Y

Acknowledgement
In performing our assignment, it's a successful one we had to take the help and
guideline of some respected persons. First of all we are grateful to Allah who gives us
sound mind & sound health to accomplish our assignment. The completion of the report
gives us much Pleasure. But it is not our credit in this endeavor. We would like to thank
our gratitude MR. SALMAN SALEM SHINWARY, Course Instructor,
Fundamentals of HRM, School of Business, Aust, Bangladesh for giving us a
good guideline for assignment.
We would like to thank School of Business Studies, Ahsanullah University of Science &
Technology for updated education system in Bangladesh. Lastly we would like to deliver
our whole hearted thanks to all the MBA students, Aust, for their cordial cooperation.
Actually it was not possible for us to complete a severe task without such help. So we
pray the long life and good health for all the persons who have helped and co-operated
us in our assignment.

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Table of Contents
Serial Subjects Pages
01 Abstract 02
02 Introduction 03
03 Literature Review 03
04 History of Human Resources Management 04
05 Meaning Human Resource 05
06 Meaning Human Resource Management 06
07 Definition of Human Resource Management 07
08 The Changing Role of Human Resources in 21st
century
07
09 Challenges of 21st Century HRM 13
10 How these above mentioned challenges affect the
human resources
14
11 Human Resource Management: Major Influencing
Factors in 21st century
15
12 The goals of HRM 15
13 An HR system refers to how different HR practices
are used in combinations to address three primary
issue
18
14 Implementing HR Policy 19
15 An Emerging Human Resource Management
Practice in 21st century
20
16 Recommendations 24
17 Conclusions 25
18 Reference List 26

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Importance of Human Resource Management in 21st Century
1. Abstract:
This paper report on Importance of human resource management in 21st century:
challenges for future. The managers today face a whole new array of changes like
globalization, technological advances and changes in political and legal environment.
Change in information technology. The great challenge of HRM is to attract, retain and
talented employees.HRM is the function within an organization that focuses on
recruitment of management of and providing direction for the people who work in the
organization.
Technology has changed everything with great extent, the methods of production, the
process of recruitment, the training techniques, and new equipment etc. Now it’s up to
HR personnel’s to work with their functions as shown below to best manage the
workforce. With the 21st century in motion human resource management will face some
of the old struggles and HR will be forced to face many new challenges. The main objective
of HR is to recruit, retain, train, retrain and keep workers satisfied. Indeed, these
responsibilities can be challenging in the 21st century, especially with changing roles, a
multi-generational workforce, and globalization.
Parallel with the change in the global arena, the qualification of the workforce has been
changed. The changes of the workforce required a shift from traditional personal
management to human resource management. With the evolution of HRM, this field has
gain a more strategic perspective in both academic literature and practice. Human
resources have started to be seen as an inimitable and most valuable factor for
organizations to gain competitive advantage. With this perspective, HRM department has
gain more importance and become strategic players in the organization. Today, the new
HRM requires being strategic partner in the organization by aligning all the HR functions
with the mission, vision and strategies of the organization.
In these pieces of paper we have discussed those foremost challenges which are
confronting today Organization. To overcome these challenges the HR mangers will have
to build a standard structure that allows managing all different workforce alternatives.

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This way the organization maintains their competitive advantages. Recommendation and
conclusions are given at the last of this paper.
Keywords:- importance of HRM 21st Century, HR manager, HR challenges, globalization,
issues, strategies, competitive advantage.
2. Introduction:
Human beings are the most important resource of an
organization. These are the people who plan all the
activities and then they carry on all the activities. And
managing human beings is the toughest duty of the manager as no two persons are alike.
Every individual has separate values, aspirations, motivations, assumptions, goals, etc.
And now after the globalization and technological developments, they managers have to
keep up with the latest changes. The HR managers should be given proper authority and
he should have the capability to deal with the ever changing business environment. The
HR manager has to decide about a staffing agency or personally hire qualified applicants
to fill in the company requirements. They have measure the employee’s performance
against the set standards and they have to decide on the employee benefits and
compensation package.
3. Literature Review
The priorities for human resource in future what should be? The answer to this question
is very difficult but there are many factors contributing to HR managers functions and
these activities are constantly changing. By keeping in view these entire situations the
organization HR department is continuously being change also. (Marshal and paalvast,
2008)
Some of the researchers also point out that the most of the challenges which facing by
the HR in 21ST century are also, retention of the employees, multicultural work force,
women work force, retrenchment of the employees, change in the demand of the
government, technology , globalization, and initiating the process of change.
The world federation of personnel management association (WFPMA, 2009). Survey
pointed out the most important top ten HR challenges are leadership development,
organizational effectiveness, change management, compensation. Health and safety,

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staff retention. Learning and development, succession planning. Staffing: recruitment and
skill labor.
Liz Weber (2009) has pointed out that the most important challenges of the HR in business
are layoffs. The most of the owners and managers facing this hard issue. This laid off may
be due to several reasons which include the economic uncertainty, the employee’s job
instability and HR less Effectiveness.
In the view point of Decenzo and Robins (2001) and Gary Dessler (2000) the most
important challenges of HRM, are technology, E commerce, and work force diversity, and
globalization, ethical consideration of the organization which may directly or indirectly
affect the organization competitive advantages, especially with technological
advancement the affect on recruitment, training and development and job performance
with great extent can be study in organization. We can sum up these from the following
points as the foremost challenge faced by HRM is the globalization. Globalization means
the present flow of goods, services, capital, ideas, information and people. It means the
movement of these things without using any human resource. In this modern business
world, markets have become battlegrounds where both the domestic and foreign
competitors try to capture as maximum market shares as possible. Such globalization is a
challenge for HRM. However without human resource they have no value, because a
workforce is knowledgeable and skilled, who facilitates a company in going competitive
advantage over other and enable a company to compete the foreign market and to make
investment in not only in domestic market but also in foreign markets. Therefore all the
HR Managers make several strategies to develop and retain such human resource,
because Human Resource is the resource which makes an organization successful in the
field of globalization.
4. History of Human Resources Management
The history of Human Resources Management did not begin at the moment when Dave
Ulrich published his first book about Human Resources. He discovered the importance of
Human Resources Management for successful organizations but the people management
was crucial even in ancient China. The HR history is about the evolution of first communes
and growth of first ancient societies.
The army was the first driver of innovations. A nation without a strong army was
overtaken by neighbors, and it just made an importance of a strong army visible to each
citizen. A successful command requires strong, brave and smart leaders who engage and

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share a vision of the victory. It designed and developed first procedures for the
outstanding selection of new hires and leaders. It had resources to invest in innovations.
The first successful HR practices in the history can be found in ancient armies. They
required a good work organization of jobs and tasks, even they used the workforce with
no education and knowledge (more on Key Milestones in HR History).
Figure 1: HRM History
The modern history of Human Resources as we know it starts with the British Industrial
Revolution. The foundation of large factories increased a demand for the workforce
significantly. It was in the 18th century, and it is the moment when the evolution of new
people management practices begins. It is the important landmark in the history of
Human Resources. The rapid development of new industrial approaches and new
inventions to work changed the world dramatically. The quick and cheap production
became a priority for many industries.
5. Meaning Human Resource
Human Resources are the set of individuals who make up the workforce of an
organization, business sector or an economy. "Human Capital" is sometimes used
synonymously with human resources, although human capital typically refers to a more

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narrow view i.e., the knowledge the individuals embody and can contribute to an
organization. Likewise, other terms sometimes used include "manpower", "talent",
"labor" or simply "people". William R. Tracey, in The Human Resources Glossary defines
Human Resources as "The people that staff and operate an organization as contrasted
with the financial and material resources of an organization. The organizational function
that deals with the people ..."
6. Meaning Human Resource Management
Human Resource Management (HRM) is the function within an organization that focuses
on recruitment of, management of, and providing direction for the people who work in
the organization. Line managers can also perform HRM. HRM is organizational function
that deals with issues related to people such as compensation, hiring, organization
development, safety, wellness, performance management, benefits, employee
motivation, communication, administration, and training.
HRM is a multidisciplinary organizational function that draws theories and ideas from
various fields such as management, psychology, sociology and economics an effective
HRM uses the employees in such a way that their productivity is maximized. The HR
managers are required to find out right people for the right job and get the job done from
them. Other than this the human resource management is also responsible for the
motivation, development and training of the employees and retaining efficient
employees for a longer period of time. HR management has to make sure that both the
personnel and the company are complying with regulations. The human resources can be
managed by using either hard or soft approach. The hard approach involves developing
strategies for managing and controlling human beings. Under the soft approach the
manager focuses on improvement of communication between employer and employee,
motivating the personnel, and developing their leadership skills. It is important on the
part of the HR manager to ensure that their human capital is well-trained and developed.
Human capital refers to the intellectual abilities, understanding, motivation,
commitment, and relationship of the employee to the goals which are set by the company
for them. The management of employees varies from organization to organization and it
depends upon the ability and capability of the HR manager. The management has to be
well versed with the latest technological changes along with environmental changes if it
wants to achieve the competitive advantages of business in 21st century.
HRM is also a strategic and comprehensive approach to managing people and the
workplace culture and environment. Effective HRM enables employees to contribute

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effectively and productively to the overall company direction and the accomplishment of
the organization's goals and objectives. HRM is moving away from traditional personnel,
administration and transactional roles, which are increasingly outsourced. HRM is now
expected to add value to the strategic utilization of employees and that employee
programs impact the business in measurable ways. The new role of HRM involves
strategic direction and HRM metrics and measurements to demonstrate value.
7. DEFINITION OF HUMAN RESOURCE MANAGEMENT
1. According to Dessler, “Human Resource management is defined as process of
acquiring, training, appraising, and compensating employees, and attending to
their labor relations, health, safety and fairness concerns”.
2. According to Dale Yoder, “Human Resource management is that phase of
management, which deals with effective control and use of manpower
asdistingwish from the other course of power.
3. According to Milkovich and Boudreau, “Human Resource Management is defined
as a series of integrated decisions that form the employment relationship; their
quality contributing to ability of the organization and the employees to achieve
their objectives.”
8. The Changing Role of Human Resources in 21st century
There are an incredible number of pressures on today's organizations. To name a few:
environmental pressures such as increasing globalization, rapid technological change, and
tougher competition; organizational changes such as new organizational alliances, new
structures and hierarchies, new ways of assigning work, and a very high rate of change;
changes in the workforce, including employees' priorities, capabilities, and demographic
characteristics. Within these pressured organizations, there is a need for (and opportunity
for) the human resource function to play a critical role in helping organizations navigate
through these transitions. In order to play this role, however, HR will have to increase its
real and perceived value.

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The role of human resources has been evolving for some time. The shift from "personnel"
to "human resources," for example, was part of the movement to acknowledge the value
of employees as an organizational resource, and was an attempt to remove some of the
stigma that was coming to be associated with slow, bureaucratic personnel departments.
This shift in label was accompanied by a call for HR to become a strategic partner with the
leaders of the business-to contribute to significant business decisions, advice on critical
transitions, and develop the value of the employees-in short, to have a seat at the table.
Dave Ulrich provides a clear path to the next generation of HR with Human Resource
Champions: The Next agenda for Adding Value and Delivering Results (1997). He describes
a multi-faceted approach to delivering HR services that meets the needs of both
employees and employers, and positions HR as a significant contributor to organizational
success.
Ulrich presents his approach in terms of deliverables, or outcomes, for which HR should
be responsible: strategy execution, administrative efficiency, employee contribution, and
capacity for change. In the course of delivering in these four areas, he describes four
corresponding roles for HR to play within a business: a) as a strategic partner working to
align HR and business strategy, b) as an administrative expert working to improve
organizational processes and deliver basic HR services, c) as an employee champion,
listening and responding to employees' needs, and d) as a change agent managing change
processes to increase the effectiveness of the organization. One of unique things about
Ulrich's approach is that it is includes all of the ways that HR can deliver value to an
organization, rather than shifting focus from one area to another.
Similarly, Johnson (1997) describes his experiences in executive search in which CEOs
describe the HR leaders they want to hire. They want people who will be successful
business partners, strategic thinkers, and people who will understand the pressures of
running an effective business in today's market. He reports that, when hiring a leader for
the HR function, most CEOs ask for someone who is, "not a typical HR person," and that
most of the successful candidates describe themselves that way. This trend reflects the
common perception that HR "business-as-usual" is not prepared to meet the challenges
that today's businesses present.
Making the shift to a new HR role will raise unique issues for every HR group that attempts
it, but there are some common steps and activities that will increase the likelihood of
success. Some of these steps and activities are:
 Strong HR leadership. As with any major change effort, a strong leader can develop
a clear vision, motivate others to share that vision, and help them work toward

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achieving it. In order to change the role of HR in an organization, the HR leader will
need to work both within the HR group and with the organizational leaders to
reshape everyone's expectations of what HR can and will deliver. The success of
the change will depend upon HR's ability to meet the real needs of the organization
and the credibility it develops.
 Acute future orientation. One of the ways that HR can provide value is to
understand how changing environmental, organizational, and workforce factors
will likely influence the business, anticipate the associated HR needs, and be
prepared to deliver appropriate solutions to meet those needs. By maintaining a
focus on workplace trends, for instance, HR can prepare to evaluate the impact
that particular changes are likely to have on an organization's people and
processes, and be prepared to work with the business leaders to decide how to
respond-being ahead of the curve, not behind it. For example, one movement that
is likely to have significant impact on the way people are hired, managed, and
valued is that of intellectual capital. A "new role" HR department is one that has
learned about intellectual capital and its implications, evaluated the impact on
current practice, and developed ideas and recommendations for changing HR
practice and other business processes.
 Flexibility and creativity. An HR group that is successful in the future will likely be
one that is responsive to the changing needs of its client organization.
Responsiveness in the changing world of work will require being flexible-as the
organizations change, so will their needs and priorities. In addition, traditional
activities and processes may not be sufficient to meet the unique needs of the
future-HR leaders will likely rely on creativity of their groups to achieve effective
results. Increasing globalization of the market will create a need for both flexibility
and creativity as businesses try to succeed in new locations, with a new workforce,
and with new customers.
 Delivering value. Although this is not a new challenge for HR, it remains a critical
one. HR is still perceived by many within today's organizations as simply a non-
revenue generating function. It is important to make apparent the value provided
by working with the management team to hire the right people, manage them
well, pay them appropriately, and build a working environment that encourages
success. Beatty and Schneier (1997) extended the concept of delivering value
within the organization by arguing that HR must deliver economic value to
thecustomers, as well as to employees.

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Here is a sampling of strategies that have seen implemented as HR groups work to
respond to environmental and organizational changes, become more valuable, and
deliver results.
 Business unit assignment. Some companies are assigning HR employees to specific
business units as a way of enabling them to develop a focused relationship with a
small part of the business. This relationship can be enforced when the HR person
has a direct reporting relationship with the leader of the business unit. In these
situations, the central HR group usually provides information and services to the
"distributed" HR representatives, who then deliver the service personally to the
business unit. One advantage of this structure is that it fosters the flexibility and
creativity mentioned above, as the local HR people can modify and tailor processes
and services to meet the needs of their assigned business units.
 Centers of excellence. As organizations grow by merger and acquisition, they often
find themselves with multiple HR groups. These can be duplicative or
complementary. When they are duplicative, they can be subject to (painful)
downsizing and consolidation, leaving behind a department that is unable to serve
all areas of the business as well as they had been accustomed, which can, in turn,
undermine the credibility of HR. An effective response to this issue is to utilize the
multiple HR groups differently. One approach that seems to work well is to develop
"centers of excellence," where the HR groups in different parts of the company
develop their expertise in a particular area and serve the needs of the larger
company in that area-HR groups operating within this model can see each other as
resources rather than competitors, and the company benefits from high levels of
expertise in a number of areas.
 Consulting model. A number of HR departments with whom I've worked have
adopted a consulting model of providing service. They view their internal
customers as clients, learn consulting skills, and take their client satisfaction as a
measure of their success. In one large high-technology firm, internal clients whose
needs cannot be met by the internal HR group can go to external service providers
directly-even for basic HR needs.
 Job rotation. One way to bring the perspective of the business into HR-and vice
versa-is to rotate line managers into the HR function for periods of time. These
individuals often serve as reality checks for the HR group, and then bring an
increased understanding of the value of HR back to their line function when the
rotation is over. This approach seems to work best when the duration of the
assignment is sufficient to allow the rotated individual enough time to become

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proficient in some area(s) of HR and when he or she is working closely with
experienced HR people who can help them learn. Sending HR people into other
areas of the business can serve a similar purpose.
 Increasing line managers' capabilities. Part of the future HR model is that
responsibility for HR activities is shared between line management and HR people.
This approach allows the manager to be more fully involved in the development
and direction of employees, with HR as a resource; it requires, however, that those
managers have the capabilities needed to work through issues with employees
successfully. Many companies are therefore increasing line managers' access to
information. Many of today's HR information systems and integrated HR systems
put tools and data on each manager's desktop.
It is clearly time for a quantum leap in the HR field, and I/O psychologists working with
and for HR professionals can support this transition by taking seriously the organizational
pressures to change, helping to identify ways to measure the value delivered by HR, and
conducting meaningful research related to all areas of human performance in tomorrow's
organizations.

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Figure 2: 21st Century HR functions
Human Resource
Functions 21st century
Human
resource
planning
Job Analysis
design
Recruitment
and Selection
Compensation
and
remuneration
Promotion/
Transfer/
Termination
Training and
Development
Orientation and
Induction
Motivation,
welfare, health
and safety
Industrial
Relation
Maintenance &
equal
employment

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9. Challenges of 21st Century HRM
Following are some challenges being faced by the HR department.
I. Attracting & selecting the best candidate:-
It has become very tough to find suitable talent as this a process where every candidate
will differ from others in one or the other sense. Even the managers will take decisions as
per their perceptions thus possibility of bias can’t be ruled out. Every manager’s decision
is influenced by his values, beliefs, political and social views. So 21st century poses the
challenge of selecting and attracting the best candidates by keeping the competition in
mind. The managers need to know that high-quality, skilled talent can be worth its weight
in gold and all the organizations are after them to join them but nobody’s able to find
them. While gold in the 19th century was found in abundance but today's high-quality,
skilled talent is not.
II. Promoting organization culture:-
An organization is full of diverse people; which is good in a way as different minds will
lead to innovation and new ideas but managing the culture with so many diverse minds
and putting across the cultural values is a tough task. Since organizational culture is an
important factor in attracting the new talent therefore HR manager has to put in a lot of
hard work and efforts to develop a successful organization structure. Managing these
people with diverse cultures like different religious, cultural, moral background is a
challenging task for the HR Managers in 21st Century. Due to acquisition and mergers
taking place it becomes important for the HR Manager to develop the work culture
because the whole organization is to be restructured after mergers. Organization’s now
are adopting more flat and simple structure. Globalization will impact HR managers by
requiring new skills such as language capabilities because the manager will have to speak
to other nationals while recruiting them.

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III. Career development of the employees
With the coming of globalization, there have come many technological developments and
changes. Innovation is the key to survive in the business. And workforce being an
important factor in the organization has to trained and developed along with the changes
in the business environment. Training should not be restricted to improving skills and
knowledge alone; rather it should concentrate on the overall career development of the
employee, which is a major challenge for the HR manager.
IV. Adopting human investment perspective
The HR manager will have to adopt more active than the reactive approach. He needs to
focus on using business strategies in human resources policies and practices for satisfying
consumers and employee’s needs. Need of the hour is to develop a workforce that
reflects the diversity of consumers and clients. Thus role of HR managers is expected to
change radically in the next decade. HR manager should be equipped with specific
competencies to support these roles. Thus, as mentioned above also, the mangers will
have to spend nearly all of their time managing cross-functional work teams. The
managers will have to develop an international workforce, they will have to keep the
written records of other cultures and keep the management informed of the cost for not
paying attention to all these major issues.
V. Making new retention & motivation strategies
As the organizations have opened up to hiring worldwide, it has become necessary for
the managers to have better retention policies. A multinational company comes with its
own set of rules and policies, but they have to adopt new rules and policies keeping in
mind the work culture of the country they are operating it. Only then they’ll be able to
satisfy the employees of that country and thus it will reduce the attrition rate. If the
employees are motivated and like their job, they are less likely to leave. The managers
will have to walk that extra mile to motivate today’s employees.
VI. Conflict management
21st century brings with it long working hours, target pressures, high competition, etc.
which can lead to stress and conflicts in the organization. The HR manager’s burden
increases as he will have to make sure that work is done timely and accurately but at the

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same time he will have to find ways of reducing stress and conflict before it can cause any
serious damage. Simultaneously, he has to balance his work life and personal life as the
stress and long working hours can also have a toll on him.
VII. Managing virtual workplace and e-commerce
Electronic commerce means to perform the trading activities through internet. The on-
line business has become a challenge for the workers. The managers are finding it hard
to hire & develop human resources who have the ability to attract, motivate, retain, and
to serve as maximum customers as possible. The virtual business world has forced the
business houses to decentralize their functions as flexible work arrangements take away
most of the time of the manager.
VIII. Business ethics and values
With changing work culture and structure, it has become more important to have ethics
and values in place which will also in the long run decides the sustainability of the
organization in the global market place.
10. How these above mentioned challenges affect the human
resources
i. 1 .Cross cultural training of HR personnel so that they understand other cultural
people
ii. 2. HR will find its role highly globalized to emerging trends in the recruitment,
motivation and retention.
iii. HR should adopt the change at internet speed.
iv. HR will have to be on a continuous lookout for the innovations as they say
“innovation is the key to success”.
v. The traditional managers who have significant product and customer knowledge
will be rigid to adapt to the changing situation. They can oppose the use of new
technologies.
vi. Differences can arise among the internal management as they can divide in groups
of tech savvy and traditional partners giving way for internal conflicts.

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11.Human Resource Management: Major Influencing Factors
in 21st century
In the 21st century HRM will be influenced by following factors, which will work as various
issues affecting its strategy:
• Size of the workforce.
• Rising employees' expectations
• Drastic changes in the technology as well as Life-style changes.
• Composition of workforce. New skills required.
• Environmental challenges.
• Lean and mean organizations.
• Impact of new economic policy. Political ideology of the Government.
• Downsizing and rightsizing of the organizations.
• Culture prevailing in the organization etc.
12.The goals of HRM:
Human resource management’s fundamental goals involve placing appropriate
employees in open positions, promoting impartial and legal treatment of all workers and
ensuring the company complies with applicable labor laws. The human resources team
identifies the elements of each HR function and engages in strategic planning to meet
each objective.
Recruiting and Hiring
HR management works with the marketing and public relations team to develop the
company’s brand and attract quality employees. It recruits candidates through applicant
search strategies, such as colleges and professional organizations, and implements
application and interviewing processes. The department interacts with managers and

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supervisors on an ongoing basis to determine departmental staffing needs and
establishes new hire orientation procedures. The overall goal of recruiting and hiring is to
meet the company’s short- and long-term staffing needs.
Employee Benefits
Employee benefits, such as health insurance and retirement plans, help attract and retain
quality workers. To meet this objective, the HR management team researches, analyzes,
compares and recommends benefits packages. The department devises effective ways of
communicating benefits to employees, retirees and their beneficiaries. It works with key
stakeholders and employees to select benefits that respond to the employer’s and the
employee’s needs.
Recognition and Reward
The human resource management team creates recognition and reward programs to
retain high performers and to motivate employees into doing their best work. Incentive
programs may include bonuses, commissions, stock options, merit increases, contests,
gifts, commuter passes, achievement awards and annual events, such as picnics and office
parties. HR measures the popularity of such programs among employees and their impact
on the company budget.
Training and Development
Employees who need more knowledge or skills to capably perform their duties or grow
with the company can benefit from professional development. The HR management team
meets with managers and supervisors to discuss training for new hires and existing
employees. Based on employee performance, strengths and talent, HR recommends,
schedules and monitors training and development costs.
Legal Compliance
Interpreting federal, state and local employment laws and ensuring the company adhere
them is essential to HR management. These laws may pertain to hiring, performance
evaluations, wages and hours, employee classification, termination, attendance,
immigration, discrimination, harassment, retaliation, workers’ compensation, record-

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keeping, unemployment insurance, safety and employee benefits. The objective is to stay
current on these laws and apply them properly to avoid audits and penalties by the
government.
Goal Setting Standards
Establishing goal setting standards allows HR to monitor whether employees are meeting
company standards. Expectations may relate to attendance and punctuality,
communication, flexibility and adaptability to change, work knowledge, leadership
abilities, diversity tolerance, customer relations, listening skills, management style,
teamwork, and problem-solving, organizational and time management abilities.
Metrics and Reports
The human resource management team uses HR metrics and reports to measure the
effectiveness of the department. HR software has metrics and reporting tools that
simplifies quantifying costs related to each HR function. For example, metrics calculate
cost of benefits per employee, benefits as a percentage of operating expenses, absence
rates and wages and salaries paid to each full-time employee.

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13.An HR system refers to how different HR practices are used in
combinations to address three primary issue:
Figure 3: What is an HR system?
Work
Environment
Employee
Attitudes and
Behaviors
Employee
Competencies
Recruitment, Selection,
Training, and Development
Job design, Organizational Structure
Participation/ Empowerment
Incentives and Rewards Performance
Evolution and Appraisal Compensation

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14.IMPLEMENTING HR POLICY:
The aim will be to implement policies fairly and consistently. Line managers have a key
role in doing this. As pointed out by Purcell et al (2003), there is a need for HR policies to
be designed for and focused on front line managers. It is they who will be largely
responsible for policy implementation members of the HR can give guidance, but it is line
managers who are on the spot and have to make decision about people. The role of HR is
to communicate and interpret the policies, convince line managers that they are
necessary and provide training and support that will equip managers to implement them.
As Purcell ET at (2003) It is line managers who bring HR policies to life.
 Develop an integrated compensation plan
 The board has approved the plan and monitoring and evaluation mechanisms are
in place.
 The plan has been communicated to employees.
In some instance, it may be advisable to appoint someone internally who will help
facilitate the efforts of the interim executive. This person will be responsible for
evaluating the performance of the executive and conducting periodic reviews at identified
project milestones. This person can be the sponsor or another senior staff member.
Often, this person will be someone who has a vested interest in the positive outcome of
the project or assignment. In certain circumstances the senior human resource
practitioner may be appropriate for the role. For instance, when there is a planned or
unplanned departure of a senior manager, the human resources executive may want to
collaborate with the interim executive in the hiring of a permanent replacement.
The criteria for hiring an interim executive should be no less rigorous than those used
when hiring a permanent employee. Specifying used when hiring a permanent employee.
Specifying what experience and qualifications are needed for the job is merely a
minimum. To be successful, expected behaviors should also be defined.
Conditions of increasing competition have focused attention on the role of company
human resource policies within the wider business strategy. Changes in policies towards
employees are frequently claimed to be integral to company success in the face of
intensified market pressures. However, despite the importance of these issues, relatively
little attention, to date, has been paid to the possible links between innovations in the
management control systems (MCS) responsible for implementing the desired strategic
changes and the management of human resources.

21
In particular, this examines the opportunities for HRM to contribute to the successful
implementation of new financial and production-control systems. One of the principal
aims of these new MCS is to widen the responsibilities of managers and supervisors and
to increase their accountability to senior managers. A distinctive feature claimed for HRM
is that line managers and supervisors become more involved in implementing an overall
policy on human resources. Clearly, there exists an opportunity for these two sets of
changes to support one another. The intended widening of line managers' duties might
potentially include additional human resources responsibilities. The desired increase in
managerial accountability creates the opportunity for them to become more involved in
promoting a distinct HRM philosophy and approach
15.An Emerging Human Resource Management Practice in 21st
century
 Human resource management (HRM) and Human capital management (HCM)
Human capital management requires capable employees whose competence is above
board and are highly proficient in performance of their work. These people introduce
creative, innovative ideas and make the organization different from its competitors.
Human capital management is related to employee’s commitment, retention, talent
management, learning and development of personnel. To manage highly competent
employees has become very important in order to survive in today’s dynamic and
extraordinary competitive environment (Huselid, 1995 and Youndt et al., 1996). There are
three elements of human capital management that boost-up the effect of human
resource management:
 Employee dedication
 Mutual trust between employer and employee.
 Norms, values of organization and also the top management behavior (Tower,
1994).
 Significance of Human Capital Management
It is very important for any organization to attract, fascinate and retain highly capable
employees. Mostly, the organizations concentrate on their physical and financial

22
resources but relatively do give a considerable amount of time on its personnel’s.
However, the organizational employees have formal reporting relationship and chain of
command. There must be pragmatic policy to motivate the employees and in turn give them
the ex-gratia or right benefits. By motivating their employee at the right time; the
organization can easily attain the competitive advantage (Edward & Lawler, 2009).
 Human Capital Framework
Figure 4: Human Capital Framework
 Knowledge Management and Human Capital Management:
Knowledge management is an institutionalized erudition, which enhances the
organizational productivity and also brings about innovative and creative ideas through
collective wisdom (Stankosky, 2007). Knowledge management is meaningfully significant
because it supports the organizational objective in a way that it determines what special
expertise the organization requires. Following this the logical sequence is: (a) find out the
people having that special expertise, (b) recruit them and create intellectual capital to
have more unique suggestions. Below are some kinds of intellectual capital (Jackson,
2007):

23
 Human capital
 Social capital
 Process capital
 Intellectual property
 Human capital and organizational learning capability:
Human capital is a valuable and intelligible resource of an organization through which the
organizational long-term survival can be foreseen and achieved. Prudent management of
human resource in an effective manner shall enable the organization not only to sustain
its long-term survival but also will increase its alert responsiveness to work in the dynamic
environment (Barney & Wright, 1998).
Organizational learning capability; among others, have aspects of tangible bearing (Jerez-
Gomez et al, 2005) as below:
 Managerial commitment.
 System perspective.
 Openness and experimentation.
 Knowledge transfer and integration.
 Organizational learning capability is further divided into two aspects:
1. Absorptive Capability and
2. Transformative Capability.
 Transformational leadership:
In today’s dynamic and intensely competitive environment it is pivotal for the
organization to be unique from the competitors in order to survive and sustain its lively
entity. Obviously there are certain requirements for achieving the competitive edge.

24
These elements are the organization’s norms and values, its human capital, governance
and its information technology. The organization must have these factors in a unique
manner in order to make its organization different from its competitors (Barney, 1986;
Powell & Dent-Micallef, 1997; Wright et al, 1994; Hitt et al., 1998).
These elements will also generate the intellectual capital, which includes both the human
capital and the structural capital. Basically it is the human resource of an organization,
which leads towards the competitive advantage because the human resource is intangible
resource of an organization and also it is difficult for its competitors to generate the kind
of employees at par in competence in their organizations (Prahalad & Hamel 1990; Barnet
1991).
 Employee Engagement and Performance Management:
Employee engagement refers to the dedication and loyalty of an individual towards its
job (Schaufeli & Salanova, 2007). It follows that not only an employee is physically
providing its services to the organization but also he is very passionate about his job
(Kahn, 1990). However, employee’s engagement is positively related with the
organizational productivity. The appropriate resources available to the employees to
complete their work are of immense significance because this will make the
organizational employees more enthusiastic about their entrusted task and also make
them dedicated, loyal to the firm. It will also provide opportunity to the employee for
their further development and advancements in careers, which will ultimately make the
organization different from its competitors. Resources enable and facilitate the
employees to fulfill the requirements of job and to work in the turbulent environment
(Bakker & Demerouti, 2007, 2008).
 Talent management:
Talent management implies: appositely finding the most suitable incumbent for the
organization (Jackson & Schuler, 1990). It is also defined by Roth well, 1994 as a
methodology by which we make sure that the highly competent employees will get the
opportunity to further develop their careers by fulfilling the top management positions.
Talent management is also known as succession of planning and human resource
planning. Here the organization makes sure that every employee will get the proper and
sufficient opportunities and make the best of it. The most important aspect of talent
management is that the organization must be aware of their personnel’s talent, traits,

25
expertise and the level of competence. Talent management is succeeded by the second
most significant element, which is human resource planning. Organizations usually make
lists of the competencies they mostly require. This will help them to find out the individual
with appropriate skills. Talent management involves high performing employees and
highly capable individuals. Combining highly capable and competent employees will help
the organizations to do succession planning successfully (Axelrod, Han dfieki-Jones &
Michaels, 2002; Michaels, Hadfield-Jones & Axelrod, 2001).
16.Recommendations:
In the present era most of the organizations are competing globally for their best
reputation, by keeping in view the above issues and challenges the HR mangers are
responsible to train all the young workers, to provide them best rewards as a result they
will show their commitment and loyalty.
Technology has changed each and everything with great extent, the methods of
production, the process of recruitment, the training techniques, new equipment and
technology should be introduced and purchase by the organization and training should
be provided to young and educated workers.
Keeping in mind by HR manager the issue of Globalization, to cope this issue the
concept of Globalize Human Resource Management (GHRM) should be implemented to
prepare the skill people or manager worldwide. This way the trend of globalization can
be minimized with some extent.
Human resource manager should develop such a HR system which consistent with
other organization elements such as organization strategies, goals and organization style,
and organization planning.
One of the great debate also going on work force diversity, the HR manager responsible
to make such a broad strategies which help to adjust employees in global organization,
HR must develop the ability to compete in the international market.

26
Organization culture is also another important element which must be consider by the
HR manager, the culture must be like to shape their behavior and beliefs to observe to
what is imperative.
To provide more and more talent people into the organization the HR manager must
re-decide and re-arrange the staffing functions, for recruitment selection, training and
transfer, promotion, dismissals, placement, demotion and layoffs of the employees
separate strategies should be developed and implemented.
17.Conclusions
The important of HR in 21st
century providing sustained competitive advantage was
shown to be achieved through recognizing and incorporating many different ideas and
perspectives into the management of the HR function. Likewise, properly managed HR
was identified as being an integral contributory factor in improving organizational
productivity. It was also discussed that through attentive and forward-thinking
management of HR, the value of HR can be improved, organizational productivity can be
enhanced, and competitive advantage can thus be attained.
The view from Sparrow (cited in Roberts, 2003) is that, “Organizations must shy away
from ‘one best way’ solutions when designing global HR systems” and that “even among
HR professionals there are different views about which HR practices deliver competitive
advantage, that can have a major impact on global knowledge transfer". It was through
the resource based view (RBV) that the value, rareness, imperfect imitability and
imperfect substitutability of an organization’s HR were shown to provide the means for
an organization to attain an advantage over their competition. These included recruiting
and selecting suitable employees, encouraging diversity in the workplace, managing
knowledge, fostering innovation, and focusing on employee development and
engagement. Figure 1: 21st Century HR functions, Figure 2: What is an HR system? And
Figure 3: Human Capital Framework. This is but one of the areas that the HR manager of
the future will have to concentrate to satisfy employees from Baby Boomers to
Generation Yers.

27
18.Reference List
1. Ashwathappa K., ( 2006) Human Resource Management, Tata McGraw Hills , New
Delhi, 3rd edition
2. Challenges of Human Resources Management in the 21st Century,
www.ituarabic.org.
3. P. Subba Rao,( 2006) Personnel& Human Resource Management, Himalaya
Publication, New Delhi, 3rd Edi
4. Dessler, (2013). Human Resource Management, Pearson Education Limited.
5. International Journal for Administration in Management, Commerce and
economics [222-225]
ISSN: 2347 – 9558
ISSUE: 3 (January-2015)
6. Jeffrey A Mello, (2003). ‘Strategic Human Resource Management’, Thomson,
Singapore, Southwestern Limited.
7. Losey, M. (2005). Future of Human Resource Management: 64 thought leaders
explore the Critical HR issues of today and tomorrow. Published john Wiley & sons
USA Inc.
8. Macky, K, & Johnson, G (2000). Managing Human Resource in the Newzeland,
Edition 2nd, published by Auckland, McGraw Hill.
9. Mamoria C.B. And Mamoria S. (1997). Personnel Management, Himalaya
Publishing Company.
10.Miller, J.S& Cardy, R.L (2000). Technology and Managing People: keeping the
Human in the Human Resources. Journal of labor Research, vol 21, page 447- 461.
11.Randy L. Desimone, Jon M. Werner – David M. Marris, (2002). ‘Human Resource
Development’,Thomson Southwestern, Singapore
12.Robert L. Mathis and John H. Jackson,( 2003 )‘Human Resource Management’,
Thomson Southwestern, Singapore.

28
13.Forster, N. (2005). Maximum Performance: A Practical Guide to Leading and
Managing People at Work. Cheltenham: Edward Elgar Publishing Ltd.
14.Gilbert, J., & Jones, G. (2000). Managing human resources in New Zealand small
businesses. Asia Pacific Journal of Human Resources, 38(2), 55-68.
15.Gottschalg, O., & Zollo, M. (2007). Interest alignment and competitive advantage
Academy of Management Review, 32 (2), 418-437.
16.Haesli, A., & Boxall, P. (2005). When knowledge management meets HR strategy:
an exploration of personalization-retention and codification-recruitment
Configurations. International Journal of Human Resource Management, 16 (11),
1955-1975.
Website
1. http://www.ukessays.co.uk/
2. http://www.siop.org/
3. www.wikipedia.org/
4. www.slideshare.net
5. www.hrmars.com
6. think-business.org
THANK YOU 

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