13-08-2013, 04:13 PM
Innovative HR practises: Leading Companies
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ABSTRACT
Abstract India is a very fast developing country. This has given lot of opportunities for our country to grow further but it posed lot of challenges in front of us like Indian companies have acquired foreign giant companies and are trying to establish themselves more competitive than the foreign companies. Moreover, competitive pressures on the organizations have encouraged them to be proactive in diagnosing HR problems and to adopt more innovative HR practices since these were no longer a matter of trend, but rather of survival. Hence the corporate have started formulating and adapting innovative HR strategies. In this paper an attempt has been made to discuss some of the key HR functions where and how innovative strategies need to be developed for ensuring the organizational excellence. It also reviews the various studies done on innovative HR practises. The paper also attempts to find out various innovative HR practises and the leading companies who have adopted such practises.
INTRODUCTION
The past few decades in business have been characterised by a succession of fundamental shifts in the way companies operate and structure themselves. In their search for greater efficiencies, economies of scale or lower costs, companies have embraced trends such as outsourcing, off shoring, and mergers and acquisitions, while rapid technological development has transformed the way information is shared and communicated, and the way business processes and transactions are conducted.
Although trends such as off shoring, mergers and acquisitions, and large-scale IT projects can have different objectives and require different skills, they are all examples of business transformation. Each type of project requires executives to set clear objectives, to ensure that those aims are understood by everyone in the organisation and to focus carefully on the implementation stage so that the objectives are achieved. In short, each project is about managing large-scale change – something that in today’s highly distributed, global organisation is a complex and demanding undertaking. Business as usual is no longer an option. To succeed in the long-term, companies must safeguard their reputation, maintain a safe, healthy and productive workforce and ensure that the materials they need have been sustainably sourced. So, managing human resource today has become very vital.
Human Resource Practise
As the world is becoming more competitive and unstable than ever before, manufacturing-based industries are seeking to gain competitive advantage at all cost and are turning to more innovative sources through HRM practices (Sparrow, Schuler, & Jackson, 1994). HRM practices have been defined in several aspects. Schuler and Jackson (1987) defined HRM practices as a system that attracts, develops, motivates, and retains employees to ensure the effective implementation and the survival of the organization and its members. Besides, HRM practices is also conceptualized as a set of internally consistent policies and practices designed and implemented to ensure that a firm’s human capital contribute to the achievement of its business objectives (Delery & Doty, 1996). Likewise, Minbaeva (2005) viewed HRM practices a set of practices used by organization to manage human resources through facilitating the development of competencies that are firm specific, produce complex social relation and generate organization knowledge to sustain competitive advantage. Against this backdrop, we concluded that HRM practices relate to specific practices, formal policies, and philosophies that are designed to attract, develop, motivate, and retain employees who ensure the effective functioning and survival of the organization.
HRM as a system
A HRM system brings together HR philosophies that describe the overarching values and guiding principles adopted in managing people, HR strategies that define the direction in which HRM intends to go, HR policies that provide guidelines defining how these values, principles and the strategies should be applied and implemented in specific careers of HRM, HR processes that comprise the formal procedures and methods used to put HR strategic plans and policies into effect, linked HR practices that consist of the approaches used in managing people, and HR programmes that enable HR strategies, policies and practices to be implemented according to plan. Becker and Gerhart (1996) have classified these components into three levels: the system architecture (guiding principles), policy alternatives, and processes and practices.
NEW PRACTISES IN THE FIELD OF HRM
Virtual HRM
The purpose of the VHRM is to assist Human Resource Management (HRM) teams of four to 10 individuals to assess their current HRM system and develop an action plan to improve it.
The VHRM is structured in five modules. The first module offers a general introduction to the program. Participants will have the opportunity to become familiar with the website and the organization of the program. The next three modules explore the fundamental principles of HRM systems, and will culminate in the creation of the action plan. During the VHRM, each participating team will develop an action plan. The VHRM facilitators will support the teams in the creation of their plans, providing guidance, giving suggestions, and answering questions.
Moon lighting by employees: Blue Moon to full moon
Blue moon to full moon. Employees in most of the organizations realize that all their demands cannot be met by their organization alone. Hence they depend either on some other organizations for part-time job, part-time business or take up a business or start an industrial unit in order to earn more. This type of activity is known as moonlighting.
Golden Hand Cuffs
A collection of financial incentives that are intended to encourage employees to remain with a company. Golden handcuffs are offered by employers to existing employees as a means of holding onto key employees and increasing employee retention rates. Golden handcuffs are common in industries where highly-compensated employees are likely to move from company to company. Employers invest significant resources in the hiring, training and retaining of key employees. Golden handcuffs are intended to help employers hold onto employees that they've invested in. Other forms of golden handcuffs include contractual obligations that specify an action that an employee may or may not perform, such as a contract prohibiting a network television host from appearing on a competing channel, and SERPS – supplemental executive retirement plans - that are funded entirely by the employer.
Examples of golden handcuffs include employee stock options that do not vest until the employee has been with the company for several years, and contractual agreements that stipulate certain bonuses or other forms of compensation must be returned to the company if the employee leaves before a certain date. Also called golden handshakes.
Golden Hand Shake
A golden hand shake is a stipulation in an employment agreement which states that the employer will provide a significant severance package if the employee loses their job. A golden handshake is usually provided to top executives for loss of employment through layoffs, firing or even retirement. Payment can be made several ways, such as cash, or stock options. Sometimes these golden handshakes are for millions of dollars, which makes them a very important issue for investors to consider. For example in 1989, R.J. Reynolds Tobacco-Nabisco paid F. Ross Johnson over $53 million as part of golden handshake clause severance compensation. Some contracts, along with compensation, include non-competition clauses that state that once employment is terminated the employee is not allowed to open a competing business for a specified period of time.
Employee engagement
Employee engagement refers to a condition where the employees are fully engrossed in their work and are emotionally attached to their organization. It is a business management concept that describes the level of enthusiasm and dedication a worker feels toward his/her job. Engaged employee cares their work and about the performance of the company, and feels that their efforts make a difference. An engaged employee is in it for more than a pay check
Employee engagement can be critical to a company's success. Engaged employees are more likely to be productive and higher performing. Employers can encourage employee engagement in many ways, including communicating expectations clearly, offering rewards and advancement for excellent work, keeping employees informed about the company's performance, and providing regular feedback.
Training and Development
Once the right candidates were recruited, it was important to get them accustomed to the company's unique work environment. Training and development played a key role here. These programs varied between frontline employees and managerial personnel. Over time, training programs evolved from classroom- based teaching to interactive multimedia training. Fresh recruits went through an eight-hour initial training session, during which they were given an overview of Marriott and their individual roles.
Grievance Redressal System
By the mid-1990s, Marriott had a comprehensive complaint resolution system in place, known as the Guarantee of Fair Treatment (GFT), to ensure that employee grievances were addressed. Under GFT, complaints passed through successive stages in Marriott's hierarchy, starting with the immediate superior, depending on whether or not they said employee was happy with the redress response given at each stage. However, given the decentralized nature of Marriott's operations, and with managers handling several tasks, resolution of complaints through GFT did not quite produce the desired results. It, therefore, decided to try new methods of complaint resolution while continuing with GFT. These methods included mediation, a toll-free hotline and peer-review.
CONCLUSION
New economic realities have put pressure on the human resource function to demonstrate how it can add value to the firm’s bottom line. In such a competitive world, organizations should come up with innovative ideas to run the organization successfully. The study has proved beyond doubt that there is a significant relation between innovative HR practises and firms performance. The adoption of such practises will immensely help and organisation to cope up with the completion and at same time keeps growing. The quality of the employees will also increase which will further affect the firm’s productivity in a very positive manner. The adoption of such practises delivers value to all the activities of the HR value chain which includes recruitment, retention, strategy formulation, strategy implementation and so on.