- Definition and peculiarities of human resource management
- Recruiting stage of people management
- HR planning as the crucial part of people management
- HR management and the company’s strategy
- Principles of HR department of the organization
People Management and Performance in Contemporary Organizations
Today no one will doubt that people are the most precious asset of any organization. Every company should ensure efficient management of qualitative personnel and its most optimal use. People management becomes an integral part of the overall success of the organization, the key prerequisite for reaching outstanding performance indicators. However, it is not only a set of pre-defined steps to calculate the employees’ performance and to minimize the company’s expenditures on salaries and other activities to sustain the workflow process. Human resource management is an elaborate philosophy developed on the thoughts of the prominent experts in this field and companies’ best practices. The well thought-out strategic people management works towards the smooth functioning of the company and eliminates risks connected to the employees’ dissatisfaction and blurry vision of themselves in the company’s structure. Contemporary sport organizations are not an exception; they adopt successful business practices and strive to satisfy the needs of all stakeholders. While the peculiarities of overall management of sport organizations may depend on their type and context they operate in, any such organization will receive significant benefits from establishing effective human resource management policies.
During the last decades, human resource management and human resource planning have become highly demanded and relatively well-developed fields of scientific research. The trends of the scientific thought in the field were determined by the changing principles and values of organizational management, the transition from solely numeric approach to the evaluation of the company’s quality performance and by increasing the importance of psychological and behavioural factors in the business environment. In general, human resource management can be understood as the system of activities and methods that enable ‘working people and the organization which uses their skills to agree about the objectives and nature of their working relationship and…ensures that the agreement is fulfilled’. Human resource management may be divided into the following areas: search for and adaptation of personnel (recruiting), human resource planning, accounting and operational work with the staff including staff training and development, assessment, work organization, management of business communications, motivation and remuneration. Among the key purposes of the human resource management are the following: ensuring the presence of the required staff in accordance with the organization’s short- and long-term strategies of development, formation of the system of preparation of top management reserves, reduction of risk of employees’ loss, streamlining of the company’s staff to achievement of required workflow results. Moreover, HR management aims to constant professional development of the personnel and their successful promotion by the career ladder.
The recruiting stage of the people management process is the decisive one, as the quality of the attracted prospective candidates directly influences the company’s performance and profits. Moreover, correctly selected new personnel increases the loyalty among the existing employees. The wrong choice of candidates usually causes significant staff turnover and lack of competence among the employees. Recruitment of the new staff begins with a job description and its analysis of its adequacy taking into account the current situation in the recruitment market and in the company. Then the recruiter begins the actual search for candidates. As a rule, recruiters already have access to the initial base of candidates who interacted with the organization previously; the base is constantly replenished, and the candidate’s profiles are updated. Nowadays there exists a wide range of methods for searching new employees. They may be found among friends and relatives of successful existing employees upon recommendation, attracted from other organizations (headhunting is especially widespread in the search for top management and senior executives). Recruiters can search for candidates in the print media, on the Internet, and in social networks. The global spread of information and communication technologies enables the recruiters to search for personnel all over the world; people become able to present themselves before the actual interview. The candidates and the employees act in the same space establish quick and effective communication. Recently it has become popular to recruit new fresh and young staff on various vacancy fairs for students and recent graduates. When the pool of candidates is selected, the HR manager conducts a job interview. Quite often, a set of interviews is not enough to evaluate the skill of a candidate required for the given position, so different tests and business games may be used.
Focusing on HR planning as, actually, the most critical subsystem of the HR management system, one may refer to Bratton’s and Gold’s definition of HR planning as of the set of activities aimed at the development and ensuring ‘of a framework that would allow an organization to integrate fundamental HR practices so that it could meet the needs of its employees, enhance their potential and meet the performance requirements of the business strategy’. Initially, this concept was seen solely within the framework of operational performance of the organization and was focused on the achievement of its numerical targets without putting an emphasis on the workers as the main asset. Such a set of activities and corresponding management philosophy was called manpower planning. The principal goals of manpower planning were to ensure the balance of demand and supply of labour and to tailor the people’s skills to the needs of the organization. The priorities of personnel managers were to forecast and calculate the required equilibrium of labour supply and demand and to hire the staff in agreement with the company’s plans. Manpower planning saw employees mainly as a factor of production and not as a significant value of the enterprise.
Some authors, however, distinguished different approaches within the concept of manpower or workforce planning. Walton yet in 1985 defined the traditional control-oriented strategy of workforce management based on strict control and hierarchy, precise calculations and employees as a changing and easily replaceable variable. In 1970-s, the leading companies from various fields came to the re-evaluation of the approach to workforce planning. The new “commitment” strategy emerged; it provided more flexibility and engagement of workers in the process of decision-making. Jobs were seen not only as means to exchange time and efforts for money to reach the key figures set by the company but also as a chance for workers to realize their potential and develop professionally.
The modern concepts of human resource management see it as one of the essential elements to support the organization’s strategy. Elaborate HR planning and people management provide for engagement of employees at all levels to the process of overall organization’s planning. The employees are to perceive the organization’s mission, vision, core values, and objectives and to understand their personal contribution to the attainment of those objectives. The understanding that employees at any level participate in the noble deal of the company’s successful performance in the competitive environment becomes an important motivation factor apart from material reward. Purcell suggests that “behavioural” or employee engagement is much more efficient to stimulate personnel’s successful performance than “work” engagement oriented solely on material results.
However, the spread of new individualized approach towards employees working commitment does not mean that mechanisms of employees control are now abandoned; they just become more flexible. Based on the prevalence of strict or liberal peculiarities HR planning may be either hard or soft. Hard HR planning focuses mainly on the benefits the company receives from a particular worker and on cost reduction by making the workforce more affordable for the company. Soft HR planning suggests that to reach success the organizations ‘need more than the right people in the right place and the right time’ but also an ‘appropriate outlook and set of attitudes’ of employees who will contribute to the corporate culture. Hauff, Alewell and Hansen note than the prevalence of commitment-based HR planning approach nowadays does not guarantee the increased company’s performance. The researchers propose to distinguish two hybrid forms of HR planning combining the features of control and commitment strategies. Those are ‘long-term-oriented control system’ and ‘regulated commitment system’.
The fundamental concept, which lies within the effective people management and exceptional staff performance, is flexibility. In the modern changing and highly competitive environment, it is crucial for the organization to be shrewd and adaptive to unstable economic conditions. The process of globalization leads to increased international labour migration, creates more job opportunities but at the same time sets more requirements to the skills of employees. Companies can now hire part-time and remote workers or offer flexible working hours for full-time workers. Reward system also becomes more flexible, taking into account the level of contribution of an employee to the success of a particular deal or project. Torrington, Hall, and Taylor define four types of flexibility in HR management: numerical (concerning the number of people employed and required), temporal (possibility to establish flexible working hours), functional (modern employees can receive various skill and not focus on only one function within the organization) and financial (employees may receive extra reward for excellent performance and their initiatives).
HR management may be effective only if it is conducted in conformity with the general strategy of the company. HR management can improve the company’s performance only if the company already has a strategic plan for its activities. As Bohlander and Snell aptly note, ‘the integration of HRP and strategic planning tends to be most effective when there is a reciprocal relationship between the two processes.' It should be noted that the approach to the development of the organization’s strategy has changed dramatically during the recent decades. Whereas previously it was considered that only the limited circle of senior management should know the strategy, today it is presented to the public and employees can influence the strategy through expressing their vision and needs. The strategy will work only if everyone in the organization becomes involved in its formation and understands the ultimate goals of the organization. Among the most successful companies who managed to implement an effective strategy through goal-setting and personal contribution of the employees is Google. In Google, everyone makes every effort because of strong belief and commitment that do “cool things that matter”. The employees here feel that they are the greatest value of the company. Every team working on a particular project is seen as an inalienable element of the enormously streamlined mechanism where the difference is not just accepted but celebrated.
HR management should be realized according to the general strategic planning steps such as mission, vision and values definition, external and internal analysis (SWOT analysis), strategy formulation, strategy implementation and evaluation. HR planning methods include economic methods (evaluating the salaries and other forms of material stimulation), organizational methods (establishing guidelines and rules for the employees) and psychological methods (motivation and moral encouragement).
Strategic HR management requires system approach. It is important for the top managers to look into the future to forecast changes in the labour market, to assess the likely demand for new talents and understand how to attract, recruit and retain people. Companies need to know exactly how many workers they need now and how many of will be required in the future. Companies should develop working scenarios of possible human resource needs in different categories of job types. With this data in their hands, companies will find themselves in a better position than others as they will be able to make decisions based on accurate information. Apart from the streamlined people management system, each organization even with the most qualified and motivated employees needs a system of evaluation. The actual effectiveness of HR management system can only be determined by comparing the degree of realization of the goals with the resources spent on it. The integral indicator that shows the efficiency of the organization is transformed into a variety of other lower levels, reflecting the efficiency of personnel management unit or individual systems or subsystems of personnel management – recruitment, planning, training and others.
While working out the HR strategy of the organization, HR department should consider both manpower planning requirements and employees personal and professional development. The main steps of manpower planning include demand forecast, supply projection, assessing competencies, gap analysis and final strategy development. HR managers should evaluate the expertise of employees, define the crucial skills to be developed for a particular position, work out a plan of possible further educational activities and develop an individual career plan for every employee. Moreover, it is crucial for HR managers to contribute to the development of overall team spirit within the company. Excellent team-building results can be reached by various team-building extracurricular activities and training.
For a modern HR manager, it is crucial to perceive the people he or she works with not as details of the company’s mechanism, but as unique individuals whose talents can be applied to both the employee’s satisfaction and the attainment of the company’s goals. The development of the human and intellectual potential of the employees should become the priority in the work of HR department. The annual total investment of the company in workplace design, staff training, in social and material support, improvement of working conditions, development of healthy lifestyle of the employees should ideally exceed the amount of funds allocated for the development of production capacities, marketing of products and other technological and technical processes.
Overall, it can be seen that modern human resource management is both the result and the driving factor of positive changes in the organizational management. Being an inalienable part of the global management strategy, thorough recruiting, planning and development of the personnel help the company to reach the highest performance results that are expressed both in material indicators of cost-effectiveness and immaterial employees’ satisfaction. Elaborate people management becomes not only a good practice of the sport organization system of management but also a rule of good tone in the modern working environment. Recent human resource management developments bring together the most valuable experience or the practitioners and give the top managers hints to a successful development of any organization in the competitive environment.