Chapter 2

Trends affecting HRM

References:
• Web resources
• Organization Theory and Design (Richard L. Daft)
• Strategic Human Resource Management by Jeffrey A. Mello
• Strategic Human Resource Management by Charles R. Greer
Resource Person: Furqan-ul-haq Siddiqui
 Open System- Open systems refer
to systems that interact with or are
effected by external environment.
 Closed System-

 Learning Organizations-
A learning organization is the
business term given to a company
that facilitates the learning of its
members and continuously
transforms itself.
Major Factors Affecting HRM

Technological Demographics
Advancement and Diversity

Organization

Globalization Legislation

Other factors
2–3
 “By 1976 Kodak accounted for 90% of film and 85% of camera sales
in America. Until the 1990s it was regularly rated one of the world’s
five most valuable brands”. In fact, In 1996, Kodak was ranked the
world’s fourth most-valuable brand behind Disney, Coca-Cola and
McDonald’s….
 In 1998, Kodak had 170,000 employees and sold 85% of all photo
paper worldwide.
 Within just a few years, their business model disappeared, and they
got bankrupt.
 What happened to Kodak will happen in a lot of industries in the next
10 years – and most people don’t see it coming. Did you think in
1998 that 3 years later you would never take pictures on paper
4
film again?
 Software will disrupt most traditional industries in the next 5-
10 years. Uber is just a software tool, they don’t own cars, and
are now the biggest taxi company in the world. Airbnb is now
the biggest hotel company in the world, although they don’t
own any properties.
 Autonomous cars: In 2018 the firstself driving cars will
appear for the public. Around 2020, the complete industry will
start to be disrupted. You don’t want to own a car anymore.
You will call a car with your phone; it will show up at your
location and drive you to your destination.
 Most car companies might become bankrupt. Traditional car
companies try the evolutionary approach and just build a
better car, while tech companies (Tesla, Apple, Google) will
do the revolutionary approach and build a computer on
wheels. 5
Automakers are also increasingly looking towards electric
vehicles: Volvo announced its intentions to produce only electric or
electric-hybrids by 2019. Jaguar Land Rover plans to go all electric
by 2020, while Aston Martin announced its plans to go completely
hybrid by 2025. (Sep 10, 2017)
 Foxconn Technology Group, is a multinational electronics
contract manufacturing company headquartered in New
Taipei, Taiwan. Foxconn is the world's largest contract
electronics manufacturer, and the third-largest information
technology company by revenue.
 Foxconn is primarily a contract manufacturer and its clients
include major American, Finnish, Japanese, and Canadian
electronics and information technology companies. Notable
products that the company manufactures include
BlackBerry, Dell, Samsung, Intel, iPad, iPhone, iPod,
Kindle, PlayStation 4, PlayStation 3, Xbox One, Nokia and
Wii U.
 25 May 2016 From BBC Technology

Foxconn replaces '60,000 factory workers

with robots
 One factory has "reduced employee strength from 110,000
to 50,000 thanks to the introduction of robots", a
government official told the South China Morning Post.
 "We are applying robotics engineering and other innovative
manufacturing technologies to replace repetitive tasks
previously done by employees, and through training, also
enable our employees to focus on higher value-added
elements in the manufacturing process, such as research and
development, process control and quality control.
 "It's cheaper to buy a $35,000 robotic arm than it is to hire
an employee who is inefficient, making $15.
 HR Technology
 The rate of technological change is staggering.
 The development of technology has created
new roles for HR professionals but also places
additional pressures on them to keep abreast of
the technology.
 With the increased technology sophistication
has come the ability to design a more useful
human resource information system (HRIS),
which is any organized approach for obtaining
relevant and timely information on which to
base HR decisions.
 Cloud computing, a means of providing
software and data via the Internet.
Issue for Integrating new Technologies
Impact of Technologies on Organizations
 Elon Musk unveiled this Tesla Bot
prototype at AI Day 2022

Two prototype Tesla Bots could walk, wave

their arms and grip with fingers. CEO Elon
Musk says they'll eventually cost $20,000
and should go on sale by 2027.
 Workforce Demographic Changes
 The “Graying” of the Workforce

Note: Dates are approximate and there is some overlap because there are no standard
definitions for when a generation begins and ends.
 Workforce Demographic Changes
 Baby Boomers (1945–1964)
 In excess supply in middle management ranks
 HR challenge is to manage “plateaued” workers
 Gen X (1961–1981)
 Are career bottlenecked by the Boomers
 Who have skills in high demand are doing and will do well
 Gen Y (1975–1995)
 Have life-long exposure to technology and constant change
 Seek self-control, independence, personal growth,
creativity
 Are not focused on job security or long-term employment.
2–15
 Negative Aspects of Older Workers
 Perceived resistance to change by older workers.
 Increased health-care costs for senior workers
 Blocking advancement opportunities for younger
workers
 Higher wage and salary costs for senior workers
 Positive Aspects of Older Workers
 As productive or more productive than younger workers
 Have more organizational loyalty than younger workers
 Possess broader industry knowledge and professional
networks
 April 6, 2016
Cabinet division proposes extension in retirement
age upto 62 years
 Islamabad: The cabinet division has decided to send proposal for
extension in retirement age by two years to Prime Minister (PM) for
approval. According to the purpose if the retirement age limit is
extended upto 62 years it will save at least Rs 200 million in national
exchequer.
 The cabinet division further said that due to retirement of 5000 to
10000 employees, financial burden of Rs 100 million to 150 million is
shifted to national exchequer every year.
Government has to incur expenses of Rs 100 million on account of
payment of salaries to those who are appointed in place of retried
employees every year. Government is spending Rs 30 billion on
account of salaries and pension of the employees per annum.
 If approval is accorded by PM then law will be got enacted from
parliament and the announcement in this respect can be made in the
budget proposals for fiscal year 2017.
Career
 Many professionals assume their work path is
predetermined by their career choice or by their
organization.
 For example, a person trained to be an accountant
may see himself or herself only as an accountant
who, after completing their professional training.
 Following one career path may be limiting for
some people.
 You may find yourself meeting the needs of their
employer, but not your own personal career goals.
 Traditional Career Stages
1. Exploration Stage- A career stage that usually
ends in mid-twenties as one makes the transition
from school to work.
 Involves:
 trying out different fields
 discovering likes and dislikes
 forming attitudes toward work and social relationship
patterns
 Includes school and early work experiences, such as
internships
22
2. Establishment Stage- Stage in which one begins to
search for work and finds a first job.
 Includes:
 search for work
 getting first job
 getting evidence of “success” or “failure”
 Takes time and energy to find a “niche” and to “make
your mark”.
3. Mid Career Stage- A career stage marked by continuous
improvement in performance, leveling off in performance
or beginning decline of performance. Person may face
threats to his/her position from younger, better-trained and
more aggressive employees.
23
 Plateaued mid-career- Plateaued but may not failed
in mid career. Even can be more productive,
committed, loyal but not ambitious as climbers.
4. Late Career- Stage in which individuals are no
longer learning about their jobs nor expected to
outdo levels of performance from previous years.
 Successful “elder states persons” can enjoy
being respected for their judgment. Good
resource for teaching others.
 Those who have declined may experience job
insecurity.
 Off the job life increases in importance. 24
5. Decline Stage- The final stage in one’s career, usually
marked by retirement/death.
 May be most difficult for those who were most successful
at earlier stages.
 Today’s longer life spans and legal protections for older
workers open the possibility for continued work
contributions, either paid or volunteer.

25
 Protean Career
 The career of the 21st  The protean career is a
century is protean, a process which the person,
career that is driven by the not the organization, is
person, not the managing. It consists of all
organization, and that will of the person's varied
be reinvented by the experiences in education,
person from time to time, training, work in several
as the person and the organizations, changes in
environment change. occupational field, etc.
 i c a ti o n s
i c Im pl
Stra te g
 New Employee/Workplace Dynamics
 Emphasis on the Management of Professionals
 Establishment of separate career tracks
 Technical/Professional, Managerial /Administrative

 Use of project teams

 Less Employee Loyalty, More Loyal to Self
 Staying with employers for shorter periods; demanding more
meaningful work and involvement in organizational decisions
 Increased Personal and Family Dynamic Effects
 Nuclear families, dual-career couples, and commuter couples
 Increased Nontraditional Work Relationships
 Part-time, consulting, and temporary employment flexibility
 Outsourcing and entrepreneurial opportunities
 Dual-Career Couples - An issue related to increased
feminization of the workforce is the number of dual-career
families. The number of couples having two wage earners
has increased rapidly, having passed the two-thirds point
more than a decade ago. In order to accommodate such
families, many employers offer support services such as
“sick child” care programs and day care.
 Commuter couples are a subset of dual-career couples who
live apart in separate residences while both partners pursue
careers.
 Nuclear Family- a couple and their dependent children,
regarded as a basic social unit.
 Extended family…..?
 Added Worker effect
 Managing Workplace Diversity
 Understanding and Appreciating Diversity
 Is critical to effectively marketing to ethnic and minority groups
 Is promoted by having a diverse workforce at all organization
levels
 Helps ensure that hiring and promotion decisions are unbiased by
person differences
 Diversity Management Programs/Initiatives
 Must be integrated with organization’s mission and objectives
 Help key decision makers identify diversity’s benefits to the
organization
 Make critical decisions about implementing the optimal
program/initiative contingent on the organization and its people,
mission and culture.
Wheel of Life Work-Life Balance
 o a l s t o g i v e
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e r o r a c a d em n s e n s u r i n g
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
c ed , s u c c e s ce a r e a ll i
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yo a t i o nsh i p s, m
o t ion o n th e
l t h , re l a p r o m
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i n d i s fu l l of
r b re a k u p . Th a b l e i f y o u r m
b e
yo u is n o t e n j o y
n ot m e a n t t o
S h o p p i n g l y . L if e i s like
hurts. t a k e li f e s e r io u s
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. D o n ' t e m p o r a y
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taken serio i th lim i t e d v a l i d ity.
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Legislative Trends

The protection against

harassment of women at
the workplace act 2010
April 2014 labor agreement in France means that employees
must ignore their bosses' work emails once they are out of the
office and relaxing at home – even on their smartphones
Strategic Business Issues Affecting HRM
 A Dutch dairy cooperative is set to buy out a Pakistani food
giant with an investment of around $460 million, in what
would amount to the largest private sector takeover by a
foreign firm in the country’s history. 38
Globalization
Globalization is a process of interaction and integration among
the people, companies, and governments of different nations, a
process driven by international trade and investment and aided
by information technology.
Challenges for HRM
 Managing diversity of workforce
 Managing pressures for more labor rights in third world countries.
 Management of Laws Across Jurisdictions
 Managing Outsourced and temporary workforce
 Downsizing the workforce
 Coping with flexible working hour
 Great emphasis on training