HUMAN RESOURCE MANAGEMENT, INDUSTRIAL RELATIONS AND ACHIEVING MANAGEMENT OBJECTIVES BY S.R. de Silva Senior Specialist in Employers' Activities East Asia Multidisciplinary Advisory Team I.L.O., Bangkok [Top] [Next]
Table of Contents
Factors Influencing Trends Trends in Human Resource Management and Management Objectives The Theory of the Conflict Between Industrial Relations and Human Resource Management Reconciling the Conflict and Trade Union Views Endnotes [Top] [Contents] [Previous] [Next]
FACTORS INFLUENCING TRENDS
The objectives of managements, the ways in which enterprises are managed to achieve these objectives and the human resource management (hereinafter referred to as "HRM") and industrial relations (hereinafter referred to as "IR") initiatives in this regard, are affected by pressures, many of which are exerted by globalization. Changes in IR practices (rather than in institutions and systems) such as increased collective bargaining at enterprise level, flexibility in relation to forms of employment as well as in relation to working time and job functions have occurred as a result of such factors as heightened competition, rapid changes in products and processes and the increasing importance of skills, quality and productivity. These factors have also had an impact on HRM policies and practices. In managing change, the key elements include employee involvement in effecting change, greater customer orientation, and ensuring that the skills of employees are appropriate to the production of goods and the provision of services acceptable to the global market. As such, managing people in a way so as to motivate them to be productive is one important objective of HRM. The implications and consequences of globalization include the following:
2 1. Countries are more economically interdependent than before, particularly in view of foreign direct investment interlocking economies, as well as increased free trade. The inability of economies to be 'self-sufficient' or 'self-reliant' or 'self-contained' has been accompanied by a breakdown of investment and trade barriers. 2. Governments are increasingly less able to control the flow of capital, information and technology across borders. 3. There has been de-regulation of financial and other markets, and the integration of markets for goods, services and capital such as the European Community. 4. It has led to the de-nationalization of enterprises and the creation of global companies and global webs. 5. Production of goods and services acceptable to the global market, and the convergence, to a great extent, of customer tastes across borders determined by quality. 6. The need to achieve competitiveness and to remain competitive in respect of attracting investment, goods and services. This means, inter alia, the necessity for high quality skills at all levels to attract high value-added activities, as distinct from cheap labour low value-added ones, and improvements in productivity. Enterprises driven by market pressures need to include in their goals improved quality and productivity, greater flexibility, continuous innovation, and the ability to change to respond rapidly to market needs and demands. Effective HRM is vital for the attainment of these goals. Improved quality and productivity linked to motivation can be achieved through training, employee involvement and extrinsic and intrinsic rewards. The growing interest in pay systems geared to performance and skills reflects one aspect of the increasing significance of HRM in realizing management goals and a gradual shift from collectivism to the individualisation of pay. In such pay systems a critical attraction is the possibility of achieving these goals without increasing labour costs but at the same time increasing earnings. Realizing management goals and managing change need employee involvement, commitment and training, employee participation,...