The key challenge to HRM in the 21st century will be to facilitate cultural change within the organizations so as to cope with the resultant uncertainties
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The key challenge to HRM in the 21st century will be to facilitate cultural change within the organizations so as to cope with the resultant uncertainties"
Introduction
The debate about the role of HRM in 21st century has been going on for quite some time. It is argued that due to globalization there are many changes within the organizational structure. The emergence of post-bureaucratic organizations which are more flexible and task oriented has changed the culture within the organizations. It is argued that in present age the organizations are evolving at a rapid pace to deal with all those uncertainties related with globalization. Though the process of evolution has always been there since the very beginning but at a pace which today's world is changing this has never been there. World is an ever changing place, mankind has seen the emergence of nation states, industrialization of society rise and fall of imperialism and the new change which we see is the globalization and emergence of so called global village. Organizations today are facing many issues such as the old styles of management are no longer helping many of them and another aspect is the emergence of service based industry and its different characteristics. To help and understand the role of HRM in 21st century we need to look at pre-postmodern or modern ways of management and then compare them with post-modern or non bureaucratic style of management. One can argue whether these fast pace changes are good or not? Only thing which is not changing is the CHANGE itself.
Periodicity is a complex issue, which period are we living in? Have we moved into post modern period or are we still living in a modernist world? Or is it a transitional period? Now if we look at organizations in the last century we can see many trends and many new ideas emerging and changing. As organizations and as a matter of fact societies moved into modern or post traditional period. Process of modernity was started long ago but it became more visible in the 1st half of the last century.
Modernism's main idea was to put pervious norms on one side.....and the need to make changes rather than just revising the past knowledge in light of new techniques. This idea some how paved the way for different new theories in all fields of knowledge such as the Theory of Relativity in physics, the rise of social science in public policy and off course industrialization. (http://en.wikipedia.org/wiki/Modernism)
Modernity means the practice of modernism's ideas in a practical life. Those ideas become visible in organizations in the 1st half of the century as size of organizations was getting bigger and their operations getting more and more complex managing an organization was no longer a family affair. Traditionally the workers or as I would call them craftsmen, had almost all the knowledge and more often they were their own boss as they were manufacturing themselves but as industrialization begun in 18th century and by the start of 19th century the mass production gain momentum there was factories owned by government and rich individuals those who may not have any knowledge about the production but as they have resources to hire workers, buy new technologies and sell their stuff across the world as the colonial age was at its prime there was no shortage of new markets. At the same time to get more control and power the process of Division of labour started (as different tasks were done by different workers) and fragmentation of labour process. This division of labour leads towards the conflicts between mangers and workers as managers did not have any knowledge of actual work done by workers and gang bosses were more sort of
in- charge of workers these issues were realised and addressed by different writers like Max Weber and Taylor many other writers like Karl Marx criticised and highlighted many negatives related to Division of Labour Marx wrote that "with this division of labour", the worker is "depressed spiritually and physically to the condition of a machine". Historically the division of labour has always been there the 1st form of this division was between Men and Women and as time passes by and human kind advanced in different fields like agriculture and subsequently industrialization this divide took many new shapes and more complex character. Scientific Management:
Frederick Winslow Taylor(1856-1915) devised a system he called scientific management, through this he tried to solve different issues arising in managing workforce at the beginning of 20th century Taylor argued that his theory which he called scientific management, is far better than any other type of management as he argued that the workmen's good will, ingenuity and hard work can only be obtained by absolute regularity and not only regularity but there is a need for managers to take up more duties and burdens which in Taylor's own view were almost inconceivable to the old style of management .Taylor divided those new duties of managers into different parts and called them Principles of scientific management. The first duty taken over by management is to gather all the traditional knowledge of workmen and record it, than reducing all that into laws, rules and mathematical formulae to obtain larger out put per person, better quality which will lead towards high wages for workers and a higher profit for companies. Second of those duties of scientific management is scientific selection and development of workers and enabling them to work at such a level where they can perform according to their natural abilities. Third basic principle of scientific management is to bring the science and scientifically selected work force together and ensuring that all the work is done according to the science. The forth principle is the equal division of work between the workers and management where all the work is integrated between the management and workers and through such personal cooperation the chances of quarrel are very limited. And the fifth basic principle of Taylor's theory of scientific management is to relate the cash incentive to the amount of effort which one does to do the things right way, learning new things and changing ones way in accordance with science and in return to receive pay rise.
(From scientific Management, Harper& Row, 1947)
Taylorism is often mentioned along with Fordism, because it was closely associated with mass production methods in manufacturing factories. This led towards more control of labour process and bureaucratic way of management took its hold in organizations whether state run or privately owned. Bureaucracy is a very important characteristic of modern organizations; the word bureaucracy means the rule of office or office power. Max Weber's (1864-1920) ideas on bureaucracy and rationalization can be seen as another very important theory on which bureaucratic organizations base themselves. Weber described the ideal type ...
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(From scientific Management, Harper& Row, 1947)
Taylorism is often mentioned along with Fordism, because it was closely associated with mass production methods in manufacturing factories. This led towards more control of labour process and bureaucratic way of management took its hold in organizations whether state run or privately owned. Bureaucracy is a very important characteristic of modern organizations; the word bureaucracy means the rule of office or office power. Max Weber's (1864-1920) ideas on bureaucracy and rationalization can be seen as another very important theory on which bureaucratic organizations base themselves. Weber described the ideal type bureaucracy in positive terms, in his view bureaucracy is a more rational and efficient form of organization than the alternatives that preceded it, which he characterized as charismatic domination and traditional domination. According to his terminology, bureaucracy is part of legal domination. However, he also emphasized that bureaucracy becomes inefficient when a decision must be adapted to an individual case. According to Weber, the attributes of modern bureaucracy include its impersonality, concentration of the means of administration, a leveling effect on social and economic differences and implementation of a system of authority that is practically indestructible. (2)
Some main characteristics associated with bureaucracy are,
Task: As in any bureaucratic organization every one knows what he or she is expected to do with a very little autonomy.
Control: Those tasks are pre-programmed through rules which describe what to do how and where, when and by whom technologies can be used to implement or express those rules.
Hierarchies: Those are based upon superior knowledge and defined spheres of competence.
Organizational Careers: These are based mostly on promotion system which is based on seniority, achievements or both and another characteristic of bureaucracy is communication as decisions and orders are passed down through hierarchy.(3) McDonaldization
Almost all of those characteristics of bureaucracy are visible in a fast food giant McDonald's, Ray Kroc who took over McDonald's from McDonald brothers actually did not invented anything new as McDonald's production line and menu were made by McDonald brothers. Ray's genius lies in combining them with different other ideas such as bureaucracy, scientific management and assembly line. Then Ray franchised McDonald's in such a way that it became one of the leading national and then international fast food restaurant. This trend of efficiency, calculability, predictability or standardization and increased control through nonhuman for human technology is visible in many other organizations and is called McDonaldization. The process of McDonaldization can be summarized as the way in which "the principles of the fast-food restaurant are coming to dominate more and more sectors of American society as well as of the rest of the world." (Ritzer,1993: ).In Gorge Ritzer's view, McDonaldization is a re-conceptualization of rationalization, or moving from traditional to rational modes of thought, and scientific management. McDonaldization , certainly can be describe as the face of modernism if we want to see modernism and its implications on organizations and world economy those are clearly visible when we see different organizations and industries managing their business through Bureaucratic control. Writers all over the world are debating that whether we are still in modern period or have we moved into post modernity? as there are different other organizations which are run in a non bureaucratic way Ritzer argues and says that even today no matter how much globalization has changed the world the process of McDonaldization is still not only strong but expanding as well as he applies his thesis to various areas such as tourism (McDisneyization") or university ("McUniversity").
(Ritzer: The McDonaldization Thesis: Explorations and Extensions, 1998)
Postmodernity or Post Modern condition
The term postmodernity is used in different ways. Generally, postmodernity is the state or condition of being postmodern (i.e., after or in reaction to what is modern), in philosophy and critical theory, postmodernity more specifically refers to the condition of society which is said to exist after modernity. Where as postmodernism, refers to movements, philosophies or responses to the state of postmodernity, or in reaction to modernism. According to post modernism we are in living in a period which is different from the modern world of organized capitalism, industrialism and state surveillance ((Karen Legge: Human Resource Management.1995). Well as we look at different societies we see both trends side by side though postmodernity in its different forms is there but at the same time we see modernist type of organizations expanding themselves all over the world and still working as a bureaucratic organization. Arguably Giddens point of view is quite a valid one who says that "we are not in a post-modern era" Giddens says. It is a period of late modernity. Though he dose not disagree with the characterizations of recent social life which other theorists have termed as postmodern - scepticism towards superficiality, consumerism, and so on. Giddens doesn't dispute these changes, but he says that we haven't really gone beyond modernity. It has just turned into radical or late modernity (Giddens; 1990). Despite the Giddens argument about postmodernity there are lots of differences between modernism and postmodernism.
Globalization and Post modernity
Globalization shares many characteristics with internationalization and it is often used in both meanings some times the term Globalization refers to the erosion of nation boundaries. Factors that have contributed to globalization include increasingly sophisticated communications and transportation technologies and services, mass migration and the movement of peoples, a level of economic activity that has outgrown national markets through industrial combinations and commercial groupings that cross national frontiers and international agreements that reduce the cost of doing business in foreign countries. Globalization offers huge potential profits to companies and nations but has been complicated by widely differing expectations, standards of living, cultures and values, and legal systems as well as unexpected global cause-and-effect linkages. (www.bertanica.com/globalizatio)
The emergence of multi-national companies can be seen as both, the cause and to certain extant result of globalization as by the advancements in the fields of media technology and communication the world is shrinking day by day, there are almost same brands all over the world and all the countries are becoming more and more identical, Arguably the world is becoming the global village and people all over the world are citizens of this global village.
In economic terms globalization refers to the effect of free trade or can also be seen as overall integration and increasing interdependence among global actors whether those are economic, political or otherwise. After the World War II international trade dramatically expanded, two very important reasons were different rebuilding programs and emergence of economic institutions such as World Bank and IMF, which oversees the global economic system by monitoring exchange rates and. Though there are different aspects of globalization such as economic, political and cultural but all of these aspects are very much linked with each other.
Giddens describes the globalization as"The intensification of worldwide social relations which link distant localities in such a way that local happenings are shaped by events many miles away and vice-versa.(Giddens.1990.p.64)
The world economy depends on many factors these days, which were never imaginable some thirty years ago, as any political or policy change in China can have effects on EU economy and vice-versa. In recent history the end of cold war has brought different countries a bit more closer and it can be seen as one very important political factor which initiated the globalization.
Cultural Change in post modern condition And HRM: operations of organizations have expanded from national to international scale as multi national companies are producing their products in different parts of world the main reason for this is less labour expenditures as in developing countries the labour is quiet cheap when compare with the developed countries. Such example is China where almost every MNC has set up its operations due to low costs. Same is the case with organizations providing services to their customers as one case is of different British based organization's customer service centers, almost every big organization has its call centers in India if you are having some problem with your mobile phone and you ring its help line you are talking to someone in India just because call centers cost less in India. This can also be seen as more division of labour across the world. Globalization of economy, comparatively less expenses and more effective ways of communication has made it possible. Theorist Jean-François Lyotard understood to represent the culmination of the process of modernity towards an accelerating pace of cultural change, to a point where constant change has in fact become the status quo, leaving the notion of progress obsolete.
Postmodern condition is the result of socio-economic change and it is attributed to factors such the importance of the mass media and the rise of an increasingly inter- dependent world economy in changing environment so as everything else is changing so is the style of management. Strategic network can be seen as a product of postmodernism. postmodernist organization are "flexible organizations" which are often run through culture and on the basis of mutual trust between employer and employee this sort of approach towards management is some what post bureaucratic where there is control but not through memos and orders but actually it is more sort of task oriented also known as responsible autonomy. This type of organizational form is quite effective in increasingly changing world economy and technologies as network structure tries to cope with it through subcontracting or outsourcing, though one can debate on the advantages and disadvantages of outsourcing. There are different ways of coping with the disadvantages of the sub-contracting; organizations are building Strategic networks one very important feature is that in relational contracting the organizations are looking to buildup long term relations and their mutual understanding that problems can occur which they will try and solve by mutual corporation. As I myself has been working with a small marketing company, which actually work for different big organizations as a sub contractor one advantage for big companies is that they don't have to worry about day to day operations but on the other hand some times the skills and knowledge of a sub contractor can pose a serious threat in long run. One example is of IT industry specially the software development as organizations like Microsoft or yahoo hire different soft wear developers across the world those are literally working from their homes and then there are different software companies which are developing new software for big IT giants, IT industry in many cases is a perfect example of strategic network, sub-contracting and not only this but in IT industry mostly the employees are managed through culture and there is no formal control the only form of control is their completion of task in given time. Another example of Relational contracting is Benetton which has sales of over 2billion pounds with only 1000 direct employees while staggering 95% of all activities are done outside of the company.
Is post bureaucratic organization is the answer to all those uncertainties related with globalization? On paper the idea of flexibility and adaptability of any organization looks quiet unique, giving employees a sense of and control, an organization which is responsive to the customer's needs but in reality is it even possible and the question remains that how much manageable is it to lead by incentive and persuasion? How can we manage cultural change within the organization many writers have expressed their views about organizational culture and its characteristics. According to schein organizational culture is "the residue of success" within an organization. Schein's model, divide organizational culture into three levels as level one shows symbols ,language and visible things, on level two there are organizational norm and behavior it deals with the professed culture of the organizational participants themselves. At this level, company's mission statements and other operational creeds are often expressed as well as slogans third level of Schien's model shows the organization's tacit assumptions which are the elements of culture that are unseen and not cognitively identified in everyday interactions between organizational members. These are beliefs about organizational culture which are often taboo to discuss inside the organization deeply held beliefs. For instance, an organization can profess high moral standards at the second level of Schein's model and at the same time display quite opposite behavior. On surface organizational rewards may mean one norm but on the same time it may suggest something completely different. So it also gives us some insight into understanding the difficulties which an organizational newcomer has to face. Only understanding culture at the deepest level may not be enough to institute cultural change, because the dynamics of interpersonal relationship are added to the dynamics of organizational culture in the process of instituting desired change. Hofstede a prominent Dutch writer about organizational and national culture says that, "Managing international business means handling both national and organization culture differences at the same time. Organization cultures are somewhat manageable while national cultures are given facts for management; common organization cultures across borders are what holds multinationals together. (http://feweb.uvt.nl/center/hofstede/, 04-01-06) But does a multinational company have to have a common organizational culture to exceed? Or if it is so, to what extent is it possible? Now in such a situation it is said that the challenge to HRM is to facilitate cultural change within the organization,
Today role of HRM in any organization is going through different changes started in 1980's when the debate was mainly on the exploration of the salient aspects of the transformation of personnel management into HRM. Having done so, it moved on to issues pertaining to the incorporation of industrial relations into HRM then the integration of HRM into business strategies, devolvement of HRM to line managers, and finally seeing HRM as a source of competitive advantage for organizations. Currently, there is an ongoing debate regarding the contribution of HRM to a firm's performance. With these developments the nature of Human Resource (HR) function has changed from being reactive, prescriptive, and administrative to being proactive, descriptive and some times executive. Globalization implies accepting that cultural diversity in management composition and management style contributes to the competitive advantage of the global agency. Also, effective globalization calls for the pursuit of a number of management approaches that, on paper, may seem contradictory, but that can truly be effective only through their simultaneous and balanced application. Human resource management has to provide an organized framework for developing and managing people who are comfortable with the strategic and operational paradoxes of global organizations and who are capable of managing cultural diversity. To develop and manage a global organization implies developing and managing people who can think, lead, and act from a global perspective, and who possess a global mind as well as global skills. Not one, two, or a dozen international specialists, but a multitude of executives, managers, and professionals are needed to form the core of a global organization. The process of globalization requires a progressive transformation of thinking about the role and tools of human resource management. Changes in the contemporary global economy highlight many of the emerging challenges facing human resource management (HRM). Vast macro societal changes increasingly bind countries into interdependent nations in which goods, capital, and people move freely between these communities. To remain successful in this new global age, organizations are trying to become transnational. While internalizing strategies those are likely to succeed in global competition there is a need for careful attention to the paradoxes created in the management of human resources and the maintenance of multifaceted organizational cultures.
Arguably the survival of any global or Multinational organization in the 21st century depends a lot on HR's adaptation of global mindset and its ability to manage the cultural change within the organizations. Agencies and their leaders must learn to manage such transformations or they will inevitably lose their competitive edge. There is a need to have the ability to motivate people to excel, not just to survive; within an organization. The ability to cope with cultural relativity is the key requirement for HR managers to succeed today and tomorrow. Familiar aspects of organizational life such as organizational structure, leadership styles, motivation patterns, training and development models, and the very important concept of human resource management, are culturally relative and, therefore, need to be considered when national boundaries are crossed. To facilitate such cross-cultural adaptation, what is required is more recruitment of managers from different areas, those who can understand different cultures and the HR practitioners obviously can not work in vacuum if the culture within the organization is changing then all the mangers whether HR or others need to act accordingly as The rigid organizational hierarchy with its monolithic chain of command is giving way to integrated team networks based on autonomy and flexibility. Rigid departmentalization is being replaced by flexible organizational structure - business units and profit centers that change rapidly. We need to become accustomed to working in organizations that grow and change as if they were alive. . Blind, reactive obedience is giving place to spontaneous, proactive collaboration, and employee commitment.
Facilitating the cultural change is the key task for HR practioners in today's organizations where new value, new style of work, and increased need for flexibility calls for new approach and new skills in the workplace.(Rosemary&Kessels: HRD in knowledge Economy:p90)
"culture has been describe as 'the shared meanings, hidden assumptions and unwritten rules across the organizations(that) provide the real energy that will either progress or impede change"(sparrow and Hiltrop, 1994:247) in any network organization the level of trust plays a major role and such approach towards management has changed the organizational structure in present time as we see the emergence of different type of networks. it is said that at present time many organization are very volatile and some what chaotic, James Hite Jr view the role of today's manager is not just to learn old norms but it's the new manager who has to lead the change in the way as we relate the agents with the system and changes in the way as learning is integrated in the systems as organizational systems are more sensitive than once believed (learning in chaos: James Hite Jr:287). Beside all those things mention above we(the HR mangers) need to change our believes about organizations arguably most of HR mangers them selves are still in favor of beauracratic organization or we find it easy to work in a bureaucratic organization as everything is predefined in them, while the challenges in any post-bureaucratic organization are much more bigger but so are rewards not only in terms on money but also in terms of knowledge and better understanding of the different functions of such post bureaucratic organization. It seems that the future will rely more on intellectual capital, i.e. how to retain and manage the knowledge of the workers. Managers must also devise a way to motivate workers in a changing reality. The HR manager needs to be less concerned about trying to identify what HRM "is" but instead focus on changing HRM practices in a variety of enterprises. (Hite Jr, learning in chaos 286)
The history tells us that every new technology and every change in any type of organization has been mostly considered as dangerous but as we all know that no new invention in any field of life was possible if human kind was to stop experimenting. Any change whether cultural or otherwise has its implications for the organization the future role of HR manager is to try and bring out the best out of changes, which are concerning organization's culture or any other aspect of organizational function.
References :
Axelrod, Richard H.; (2000), Terms Of Engagement: Changing The Way We Change Organizations, San Francisco, California: Berrett-Koehler Publishers, Inc.
Baird L and Meshoulam I.; (January-February, 1992), Getting Payoff from Investment in Human Resource Management, Business Horizons.
Ritzer: The McDonaldization Thesis: Explorations and Extensions, 1998
Hesselbein, Frances , et. al; (September 1997), The Leader of the Future: New Visions, Strategies and Practices for the Next Era, (The Drucker Foundation Future Series) Jossey-Bass Publishers.
Resemery Harrison Kessels; (Human resource development in a knowledge economy)
Karen Legg, (Human Resource Management 1995)
McCall, Morgan W. High Flyers; (September 1997), Developing the Next Generation of Leaders, Harvard Business School Press.
Smith, Douglas K.; (1996), Taking Charge Of Change: 10 Massachusetts: Addison-Wesley Publishing Company.
James Hite JR ;( 1999), Learning In Chaos: gulf publishing company, Houston
Internet sources
www.wikipedia.org ,
http://feweb.uvt.nl/center/hofstede/index.htm Hofsted's Home Page.
http://humanresources.about.com/od/glossaryo/
http://www.ihrim.org/resources/eJournal/eJournalMar2005.pdf
markets politics and globalization: can the global economy be civilized
Gerald k. helleiner (Geneva 11 December 2000) web link: http://www.utoronto.ca/cis/working_papers/2000-1.pdf