Effects of Globalization
The battles for talent, recession, inadequate succession planning, brain-drain are all the effects, of a shrinking global economy and globalization, which present both threats and opportunities to companies. With companies striving to obtain a competitive advantage in the global market place, the shortage of appropriate skill-sets by individuals to meet unique requirements, is becoming more problematic. Holbeche (2009:3) states: “Talent and the ability to engage that talent to produce high performance teams are the buzzwords which can be heard in organizations in every sector, reflecting the growing awareness of the importance of being able to attract, manage and motivate and retain the right people.”
Gitman and McDaniel (2009:225), defines competitive advantage as the factor that causes customers to patronize the firm and not the competition. Moore, K (December, 2010), sums up the importance of Human Resources (HR), when he states: “Human beings, not machines or processes create competitive advantage.”
Knowledge as a competitive advantage
Wilton, N (2011:75) states, that sustained competitive advantage stems from both tacit and explicit knowledge within the firm and the ability of employees to learn faster than their rivals. Tacit knowledge is defined as that knowledge that resides within the individual and is often more difficult to articulate and communicate while explicit knowledge is defined as procedural knowledge that is codified and systemized (Wilton, N. 2011:429).
Sources of Organizational Knowledge
Wilton, N. (2011:429) goes on further to say, citing Leonard (1998), that competitive advantage may arise from four groups of organizational attributes or core capabilities:-
•Employee Knowledge and Skill
•Physical technical systems – both individual technical competence and that accumulated in physical systems built over time •Managerial systems – a firm’s system of education, rewards and incentives which guide and monitor the accumulation of employee knowledge •Values and Norms - determines what kinds of knowledge are sought and nurtured and what kinds of activities are tolerated and encouraged
From the above it is clear that employees and individuals are the core elements of the business, and it is this core element that forms the basis of acquiring knowledge. Utilization of knowledge acquired from the employees leads to systems and competitive advantage in the firm.
a) Employee Knowledge and technical competence
Boselie, P (2010) points out that, Nokia selects candidates based on their skills and knowledge in relation to the jobs technical requirements (person-job fit). This selection method ensures that employees are only selected if they bring to the organization the appropriate skills and knowledge that the company requires.
b) Values and Norms
Boselie, P (2010) also states that Nokia selects candidates on the basis of the fit between a candidate and Nokia’s culture (person-organization fit). Gitman and McDaniel (2009:226), state that the corporate culture (core values that support the mission and the business model) of the company can be a key aspect in developing employees into a competitive advantage. It is therefore important at the outset to ensure that the candidate would be able to align himself/herself to the organization’s goals and objectives.
c) Managerial Systems
Nokia encourages, promotes and facilitates development of its employees. This is evidenced though the e-Learning opportunities as well as the personal coaching of employees by senior staff (Boselie, P: 2010). Wilton, N (2011:254), states that an important strategic approach to Human Resource development is creating a “learning climate” that both encourages and supports employee development particular through informal and self directed learning. Wilton, N (2011:254), argues that this approach reconciles...