Competitive Advantages Influencing

Human Resource Management

Presented by

McGraw-Hill/Irwin Copyright 2008 by The McGraw-Hill Companies, All Rights Reserved. 1-1
Competitive Challenges
Influencing HRM
Three competitive challenges that
companies now face will increase the
importance of HRM practices:

The Challenge of
Sustainability

The Global
Challenge

The Technology
Challenge

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The Sustainability Challenge

Sustainability refers to the ability of a

company to survive and succeed in a
dynamic competitive environment

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The Sustainability Challenge

Sustainability includes the ability to:

provide a return to shareholders
provide high-quality products, services,
and work experiences for employees
increase value placed on intangible
assets and human capital
social responsibility
Adapting to changing characteristics
and expectations of the labor force
Effectively use new work arrangements

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The Sustainability Challenge

The changing structure of the economy

Skill demands for jobs are changing
Learning organization
embraces a culture of lifelong
learning, enabling all employees to
continually acquire and share
knowledge

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The Sustainability Challenge

Changes in Employment Expectations:

Psychological contract

Alternative work arrangements

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The Balanced Scorecard

The balanced scorecard gives managers the

opportunity to look at the company from the
perspective of internal and external customers,
employees and shareholders.

The balanced scorecard should be used to:

Link human resource management activities to the
companys business strategy.
Evaluate the extent to which the human resource
function is helping the companys meet its
strategic objectives.

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The Balanced Scorecard

How do customers see us?

What must we excel at?
Can we continue to improve and create
value?
How do we look to shareholders?

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Customer Service and
Quality Emphasis
Total Quality Management (TQM)

Core values of TQM include:

designing methods and processes to meet the
needs of internal and external customers
all employees receive training in quality
promotion of cooperation with vendors,
suppliers, and customers
management gives feedback on progress

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Changing Demographics
Diversity of the Workforce
Internal labor force is the labor force of
current employees

External labor market includes persons

actively seeking employment

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The Global Challenge

To survive companies must compete in

international markets
Be prepared to deal with the global
economy.
Offshoring exporting of jobs from
developed countries to less developed
countries
Onshoring exporting jobs to rural parts
of the United States

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The Technology Challenge

The overall impact of the

Internet
The Internet has created a
new business model e-
commerce in which
business transactions and
relationships can be
conducted electronically

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The Technology Challenge

Advances in technology have:

increased the use and availability of
Human Resource Information Systems
(HRIS), which are used to acquire, store,
manipulate, analyze, retrieve, and
distribute HR information
increased the use and availability of
e-HRM, which is the processing and
transmission of digitalized information
used in HRM

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