Knowledge is becoming a critically important resource in business organizations. And human resource management is the pillar for any organization. Managing human resources effectively has become vital to organization within the modern and fast-paced business environment. In order to survive in the current competitive environment it is mandatory for every company to recruit the right sorts of people in the right place. Now the question is why this word “right’’ has been used in here? Because if we recruit a driver to serve the customer in the check out and a person for driving the lorry who does not even know how to drive then we cannot expect the right jobs done by these people. Since today’s economy is the knowledge economy so I decided to show the relation between human resource management and knowledge economy.
Knowledge is defined by Sanchez, Heene and Thomas (1996) as “the set of beliefs held by an individual about casual relationship among phenomena.’’ Alvin Toffler (2008) said “Knowledge is the most democratic source of power.’’ This paper indicates the relation between Human resource management and the Knowledge economy. So we need to know what is knowledge economy and Human resource management.
Knowledge economy is an economy that increasingly bases its economic activity on value enhancing knowledge rather than limited natural resources. It has always been important. It is becoming more important now because there has been acceleration in the creation and dissemination of knowledge.
Human resource management is the organizational function that deals with issues related to people such as compensation, hiring, performance management, organization development, safety, wellness, benefits, employee motivation, communication, administration, and training.
Besides capital, labour, land and organization, knowledge is the great fifth production factor in our economy. Nowadays it is the most precious of the five factors, because it takes so much effort and money to keep it well-nourished. It is the most strategic of the five factors, because we depend on it to develop our business. According to Hecker (2001) “The knowledge economy encompasses all jobs, companies and industries in which the knowledge and capabilities of people, rather than the capabilities of machine or technologies, determines competitive advantage. Of the 19.5 million jobs that are projected to be created in the United States from 1998 to 2008, 19.1 million of them will be in the service sector.’’ So we can see that from retail sales to computers to biotechnology, these jobs will be more knowledge-intensive in their demands on workers and organizations. This paper reports the result of a qualitative study of human resource management in the knowledge economy.
Adding Ideas in the Knowledge Economy:
The knowledge economy is about adding ideas to product and turning new ideas into new products. Don Tapscott ((1996) asserts, more added value is created by brain than brawn. He provides a vivid illustration with six key attributes that distinguish them from products that were available in the past. These are the following –
1. They Learn- The more you use them, the smarter they get. The more you use them, the smarter you get. Like some word processing programs. 2. They improve with use- They are enhanced, rather than depleted, when used. They grow up instead of being used up. Like Internet banking. 3. They anticipate- They know what you want, they recommend what you might want next. Like the grocery scanners. 4. They are interactive- There is two-way communication between you and them. Like a ski jacket woven with a genetically engineered ‘phase change material. 5. They remember- They record and recall your past actions to develop a profile. Like internet sales operations. 6. They are customized- They are uniquely configured to your individual specifications in real time at no additional cost. Like...
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