Understanding HRM and Human Capital Management Order Instructions: Understanding Human Resource Management (HRM) and Human Capital Management (HCM)
Guest (2011) argues that we are still ‘searching for some answers’ to the perennial question of the linkage between HRM and business performance. Ideally, HR professionals and other organisational leaders would be able to inform their decisions about policies and practices with sound theory developed through research, and they would be able to assess the effectiveness of their decisions using valid metrics. Though we may not have all of the answers, how can HR leaders move forward with what we have? How can leaders use alternative ways of thinking about organisational performance and effectiveness, such as ‘human capital management’ (Armstrong, 2006) to enhance management approaches? To prepare for this essay:
•Read the attached files: Guest (2011) and the concept of human capital management (HCM) advanced by Armstrong (2006).
•Consider how ideas from some of your other readings this week might relate to the issues outlined in the article.
•Find and read one or two other articles cited by Guest (2011) to further inform your thinking about the issues.
•Formulate a critical response to Guest’s (2011) article, addressing how HR professionals might measure the effectiveness of their own efforts and how they might test ideas about HRM practice in their own contexts.
•What measures, metrics or tools might HR professionals use to assess the effectiveness of HRM and/or HCM, and/or its contribution to business performance?
• What types of questions might an HR leader, or another organizational leader with HR responsibilities, be able to answer in his or her own context about how to improve HRM/HCM effectiveness?
•In organisations with which you are familiar, what types of information about HRM/HCM effectiveness and business performance were available? What types of information might have been useful in improving management practice?
1) I want a typical and a quality answer which should have about 830 words.
2) The answer must raise appropriate critical questions.
3) The answer must include examples from experience or the web with references from
relevant examples from real companies.
4) Do include all your references, as per the Harvard Referencing System,
5) Please don’t use Wikipedia web site.
6) I need examples from peer-reviewed articles or researches.
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Understanding HRM and Human Capital Management Sample Answer
Understanding Human Resource Management (HRM) and Human Capital Management (HCM)
There are current efforts to answer the question of the linkage between HRM and business performance. In the real sense, HR professionals and other organizational leaders would be able to inform their decisions about policies and practices with the sound theory developed through research. This makes them assess the effectiveness of their decisions using valid metrics. HR leaders move forward with the existing knowledge on performance by using both HCM and HRM in yielding sustainable results in business (European Conference on Intellectual Capital, & Surakka 2012, p. 154. Managers can use human capital management to stop thinking about customers as assets but as a cost, they must bear to affect their business. HR leaders can measure the effectiveness of their own efforts and might test ideas about HRM practice by establishing if their customers are satisfied (Surakka 2012, p. 156). The leaders must as well identify if their employees are satisfied in their effort to meet their objectives. HR leaders may establish the effectiveness of human resource planning and forecasting. Above all, HR leaders can use the HR dashboard to check the performance of a company based on certain metrics.
Tools that might be used by human resource professionals to measure the effectiveness of HRM and/or HCM include the human capital index that measures the link between human resource management practices and the market value. The other tool used to measure HCM/HRM is organizational performance model that ideally identifies the gaps that are required to reinforce the business objectives and what is being produced. The human capital monitor is another tool, which is essentially focused on the value added per person to a business (Jackson, Schuler & Werner 2012, p. 136). The Sears Roebuck model is the fourth tool, which generally stresses increasing employee satisfaction, for example by increasing their pay, in an organization for the success of a business. The fifth tool for the measurement is a balanced scorecard. This tool deemphasizes the use of control in an organization to increase performance (Lawler & Boudreau 2009, p. 168). The balanced scorecard, therefore, underlines the use of a small number of analytical measures to build value in an organization. The last model is the EFQM model of quality, which suggests that customer satisfaction, employee satisfaction, and impact to the society are influenced by effective leadership. The contribution of these tools to business performance is that it enables the business to address all parameters/measures in order to meet its objectives successfully.
A human resource leader should ask himself questions to see how he can improve HRM/HCM effectiveness. One of the questions is whether their customers are satisfied. Another question to ask is whether the employees of the company are satisfied with their job. If not, the HR leader will have to develop strategies to reward employees in order to motivate them, and on the other side, sharing of information with the customers, whether informally or formally is very important to maintain loyalty. Another important question is whether the managerial structure is effective (Surakka 2012, p. 159). This ranges from the elements of control, work mechanisms, and performance management. Whether there is an effective and efficient work process, is another judgmental question an HR leader should ask. Questions of how work is done, level of technology, and the intensity of teamwork and interdependence among firms’ units are important to ensure the work processes part of it is looked into on how to improve HRM/HCM effectiveness.
The types of information about HRM/HCM effectiveness and business performance that were available include perceptual data, performance data, basic workforce data, non-financial data, and people development as well as performance information (Stam & Andriessen (2009, p. 202). The types of data that might have been useful in improving management practice at the organization comprise information on morale, for instance, employee turnover, motivation such as employee retention, an investment such as training investment, and long-term development such as training days.
Understanding HRM and Human Capital Management References list
EUROPEAN CONFERENCE ON INTELLECTUAL CAPITAL, & SURAKKA, J. (2012).Proceedings of the 4th European Conference on Intellectual Capital: Arcada University of Applied Sciences, Helsinki, Finland, 23-24 April 2012. Academic Pub. Pp. 154-186.
JACKSON, S. E., SCHULER, R. S., & WERNER, S. (2012). Managing human resources.[Mason, Ohio], South-Western Cengage Learning. Pp. 136-147.
LAWLER, E., & BOUDREAU, J. (2009). Achieving Excellence in Human Resources Management an Assessment of Human Resource Functions. Palo Alto, Stanford University Press.pp. 167-187.
STAM, C., & ANDRIESSEN, D. (2009). Proceedings of the European conference on intellectual capital: INHoland University of Applied Sciences, Haarlem, The Netherlands, 28-29 April. Reading, Academic Publishing. Pp. 202-2012.
SURAKKA, J. (2012). Proceedings of the 4th European Conference on Intellectual Capital: Arcada University of Applied Sciences, Helsinki, Finland, 23-24 April 2012. Reading, Academic Publishing International. Pp. 156-168.
