HR will need to have better guidelines in place for individuals in this new atmosphere (Kahnweiler 25-26).
However, there are and will always be two main components that the HR department of any organization will cover. The first is comprised of management, leadership and employee motivation and the other is the traditional realm of HR practices which include performance appraisal, training, recruitment and selection, as well as compensation management (salry and bonuses). In this regard payroll is usually located within the HR department in some respect and there is a certain amount of crossover between HR and the Finance area of any company in this regard. (Lajara, Lillo, and Sempere 38)
However, fundamentally HR is concerned with the human element and the return on investment (ROI) regarding that element has become a primary concern of the business world. Measurement of that return is not as clear-cut as it is in finance. In the business world ROI is composed of the following four elements:
1. The inflow of returns produced by that allocation; 2. The offsetting outflows of resources required to make the investment; 3. How the inflows and outflows occur in each future time period; and 4. How much what occurs in future time periods should be "discounted" to reflect greater risk and price inflation. (Boudreau, and Ramstad 26)
Transferring this ideology to the resource of human beings in a company is a little more difficult. If you invest an allocation into a staff member of x amount of dollars worth of education, what is the inflow and rate of return on that investment? How is this related to future periods and what indeed is the knowledge-based discount to the rate of inflation on the investment? While seemingly ludicrous when applied in this way, many agencies' budgets cannot make the intellectual crossover to understand and equate the performance outcomes regarding staff training and development.
In HR we do not have decision support frameworks as elegant as ROI, and simply applying ROI logic to HR investments is not the answer. The ROI components are not available for most HR decisions, and the ROI framework really does not focus on the right questions for HR investments, because it was developed for financial investments. (Boudreau, and Ramstad 27)
But again we come back to the paradigm shift that has taken place and there are certainly more viable means of ascertaining whether or not an investment in employee education has a payoff to the organization that is fundamental to the long-term profitability and sustainability of that organization.
This returns us to the concept of TBL, the Triple Bottom Line. By linking together profit, people and environment when deciding what a company is setting out to accomplish, there is a greater investment in what might be now called ecosystem of profitability. By training, educating and appreciating staff, greater staff retention and staff loyalty and involvement is usually the result. There are many steps required to make this realization such as, an analysis of capabilities within the organization, a review of leadership practices and key leadership competencies and the values of the agency must also be clearly defined. But one key concept that is germane to the entire success of the company is an ongoing and open dialog between department, personnel and HR. In researching the importance of the aforementioned steps to realization, Colbert, and Kurucz discovered the following:
In every case dialogue was described as highly important: dialogue with stakeholders to negotiate and appease; dialogue to integrate stakeholder needs and to search for win-win value creation; or dialogue to broaden the company's strategic frame of reference, and to enroll stakeholders in a new organizational direction. (Colbert, and Kurucz 27)
Communication is the key tool for HR to use in not only distributing information, but in informing management of the achievement of staff so that the positive return on investment in the employee can be readily ascertained.
Finally, HR is often called on to mediate disputes and bring the regulatory labor laws to bear on supervisors and employees alike. In instances of sexual harassment or other forms of intimidation and unfair treatment, HR is responsible for following company procedures and guidelines when resolving these issues. In fact, HR needs to assure that the correct polices and procedures are in place so that the staff can adequately assess their position and know where to bring their grievances when in trouble. If the correct protocols are not in place, the company is left open to litigation and lawsuits from staff members, severely impacting the bottom line. In this sense HR certainly plays quite a strategic role in the safeguarding of the company and its ethical and moral stature, as well as its finances.
But are there some instance where involving HR is not appropriate? Certainly in the case of line mangers and supervisors attempting to resolve employee disputes with one another, HR should not be the first agent brought to bear. It is important for mangers and supervisor to have a certain amount of control and autonomy over their units and certainly part of the nature of their job description is to act as a mediator and facilitator in regards to their staff. In fact HR is required to proactively encourage this autonomy in order to promote better and more efficient teamwork within the organization. The satisfaction that an employees derives from being able to be trusted to work out certain difficulties themselves is all part of the appreciation that the company should show their staff. That is why most pollicies and procedures manuals regarding harassment or other problems employees may encounter usually encourage them to seek out their immediate supervisors first before raising their concern to the level of HR.
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