Managing Your Workforce
Wednesday, August 4th, 2010Introduction
Human Resource Management, or HRM for short, is one of the most important factors in running a successful company, although it is not always treated with the time and focus that it deserves. To completely understand what HRM is and its influence on the success or failing of a company, we first must know what it means. The following is a satisfactory definition:
The purpose of Human Resource Management is to recruit, develop and utilise the workers within an enterprise in the manner in which is most suitable to accomplishing the aims and objectives of the enterprise.
This effectively translates to “using people in the company in the best way possible” though that would be an over-simplified statement that doesn’t echo the true nature and scope of HRM. HRM describes all of the techniques and processes that are involved in making sure that all members of staff within a business are pulling in the same direction, and more significantly, in the right direction. Without good human resource management a company will be expending effort on jobs that it may not directly benefit from.
At its core, HRM brings together three major elements that are fundamental to the productive output of the workforce. These factors include motivation, management and leadership, and organisational structures. Consequently, HRM can be employed on all levels of management inside your business, not just the shop floor personnel, and it can even be used to adjust the structure of those levels of management at the same time.
Why is it Necessary?
Put simply, businesses don’t run without employees. As a result, some level of human resource management is necessary for any business to operate at all, let alone in an efficient and prosperous manner. Even if you don’t realise exactly how HRM affects the everyday running of your business you will certainly be using some sort of HRM in order to keep trading.
Human Resource Management has an impact on every level of your corporate activities with varying degrees of visibility. The most obvious HRM tasks involve the hiring and firing of employees as well as financial systems such as payroll. It may also impact on motivation and communication within your company, which are far more intangible factors but are important nonetheless. Bad HRM practice in these less visible domains can have a damaging impact on your company but go unnoticed for long periods of time.
It also goes without saying that each organisation is different and will have a unique set of issues to face and opportunities to take advantage of. HRM can work as a versatile tool that translates workforce potential into financial profits and can adapt to fully utilise the strengths of your company.
I used to work at a company which offered individuals and firms a method of registering company formation quickly and had excellent human resource approaches in place.
Impact on Business
While this all appears very interesting and important, how does it actually impact on the daily operations of your company, and more importantly, how will it help to boost the performance and success of your firm? The effect of HRM can be broken down into the following areas.
Recruitment & Training
This is probably the part of a company that is most affiliated with human resources – recruitment. Nearly every company in the world, and especially companies that are expanding, must recruit people to work for them. Either existing employees have left, or new possibilities have arisen which mean there are roles that have to be filled.
It is also important to keep your staff training procedures up to date to make sure that your staff is fully capable of doing the job they are there to do. Whether it is a new piece of legislation or a new piece of technology that changes the industry, there is an on-going requirement to keep your organisation up-to-date and ready to take advantage of any opportunity. There is an expression that states that “if you are not moving forward you are going backwards” which can be applied to business.
You may also discover that the expensive practice of external recruitment can be avoided if your organisation has sufficient training facilities in place. It is much easier to teach an existing staff member to a higher level and then use outside recruitment to fill the gap left at the lower level than it is to hire straight to a higher level.
Employee Relations
Once you have the suitable men and women working for you it is important to keep them doing work for you, and to make certain they are doing a good job. This can be achieved by means of good employee relations. The most evident employee relations practice is the art of motivation – a broad topic itself – but other employee relations issues may include disciplinary and grievance management. All of these factors are an essential part of the overall HRM picture.
Finances
You can’t keep employees at your organisation by good motivational techniques only. They will want to be paid a fair amount and on time. Payroll ought to be one of the initial systems that is developed when you launch a business, but they still need to be maintained and updated when staff join, leave or switch pay grade. Improper management of your payroll program can quickly lead to catastrophe in terms of your staff.
Industrial Relations
Many firms will have to deal with trade union or other workers rights organisations which can be very forceful when protecting the interests of their own members. When interacting with such bodies it is beneficial to have people within your company who can connect effectively with them whilst keeping the interests of your own organisation in mind as well.
Human resource management is needed by each offshore llc regardless of how large or small your staff might be.
Workforce Planning
We have seen the effect that human resource management may have on a business and generally it seems like good HRM will have a positive effect on any business. As a rule, this is the case, but good HRM doesn’t just occur overnight.
One way to apply HRM concepts to your company is through workforce planning – a system that has the goal of making sure your staff can finish the upcoming tasks needed for your business to be successful.
Definition
Workforce planning is the process of anticipating in advance the human resource requirements of any organisation, both in terms of the number of employees required and the proper skill mix. Recruitment and training policies are devised with a long term focus in order to ensure that the organisation is able to operate without being limited by a lack of appropriate labour. It is a bit of a balancing act, but when done properly can bring about many benefits.Workforce planning can be split into four main areas; requirements, recruitment, selection, and training and development.
Requirements
Evaluating your workforce requirements is vital to the proper planning of your staff in the short-term and long-term future. If your business is subject to seasonal shifts in demand, such as in the tourism industry, or suffers from seasonal fluctuations in staff levels then your workforce planning needs to take these factors into consideration.
Recruitment
Whether you are recruiting externally or from inside your existing workforce you still need to find the right person to fill the role. As part of your workforce planning you ought to draw up a job description that describes the job that will be undertaken as well as a person specification which will give an indication of the sort of individual that would be a perfect fit for the job and your business. By mixing and prioritising the elements of these two descriptions you will be able to identify the ideal job applicant.
Selection
The selection procedure can be as involved or as simple as you deem necessary. Over and above standard job interviews there are several ways you can learn about candidates for your jobs, including aptitude tests, group interviews and even psychometric testing.
Training & Development
The principal goal of staff training and development is to develop a much better quality of worker in your company. Workforce planning can use training to fill upcoming gaps in the skill set of your workforce and is generally faster and more cost effective than external recruitment.
If your enterprise functions inside the buy limited company market you can gain from on-line promotion based around that particular phrase.
Workforce Motivation
It practically goes without saying that well motivated workers are going to deliver a better standard of work and have a higher quantity of output than unhappy workers. This improved working rate will undoubtedly lead to an increase in the profitability of a business.
Essentially, all motivational practices can be separated into two models that are often referred to as the “carrot and stick” approach to motivation. The analogy relates to the two approaches to make a donkey carry your possessions, either by tempting it with a carrot, or threatening it with a strike from a stick!
Whether you use the carrot approach or the stick approach will largely depend on your own management style, as well as the industry you work in and the type of people that you employ. Irrespective of your method, motivational factors can be broken down into a further two groups; financial and non-financial motivators.
Financial
The most common financial motivators are payment schemes. You can pay staff in numerous different ways, either a set amount for a fixed service, by an hourly or daily rate, or a rate linked to production, such as a commission scheme. Whichever method is employed, the workforce is motivated to work because they will receive money for doing so.
Another financial motivation technique involves what are known as incentive schemes, where additional financial rewards are given out for good performance. This may include commission above a fixed salary, performance-related pay levels or even offering a share of company profits. Again, the motivating aspect here is the money alone.
Non-financial
Many human resource advocates have their own thoughts about the different factors that motivate people to work, although these are often seen as a bonus to a worker. It is widely acknowledged that income is the critical motivational factor for the majority of people.
The Changing Face of HRM
As previously mentioned, HRM is a versatile application that is there to match up the characteristics of your staff to the objectives of your business. As a result, it has had to keep adapting to a corporate climate that is constantly changing for one reason or another. Moreover, it is a good idea to constantly review your own HRM policies and not to rest on your laurels.
Maybe there is a new piece of government legislation that will have an effect of how your business can carry out its operations, or maybe a new manufacturing technology will come along that will revolutionise your industry. Either way, if you want to make sure that your staff is performing to its optimum level then your HRM strategy should be flexible enough to cope with an ever-changing economy.
Mail this post