Human Capital: the State of Play in Australia

The Australian work force is a reflection of the characteristic of the Australian society, the analysis of the human resource environment can give some challenges that the companies face nowadays in a multicultural society such as Australia.The Australian workforce describes a old-fashioned human resource management as a result of the competence produced by migration strategies which affect directly or indirectly the policies and procedures in today’s Australian companies. Its work force also requires strategies that drives organizations to a competitive world and its strategies requires ethical, legal and health and safety addresses in order to compete with others organizations which has competitive human resources management as well.As a result of study that had been performed by Bill Farrell which is the leader of the Human Capital Management at IBM Asia-pacific; there are questions that were not answered, for instance, is human capital management enough strategy for Australians companies? Is only Australia the country that need to change their HR policies and procedures? There are another country more develop in HR matter than Australia? Is Australia fairly enough laboratory of workforces management in order to prove that human resources of an organization is different than human resources function?There are organizations which can not quantify the income from human capital programs (De Cieri 2008, P. 43). Most of Australian organizations have bored and lack of motivation workers in order to enjoy their job. Repetitive work leads people to become disillusioned, bored or depressed (De Cieri 2005, p. 13). Australian organizations have to be a very good place to come to work, its organizations also need to keep people smiling, focused and productive.In a case study of call centres in Brisbane which Kevin Panozza is manager, its organization is one of the most successful call centre in Australia (De Cieri et. Al 2005, P. 3). Based on the above factors, this essay will discuss the relations between each one of these factors and how its factors affect the organizations and the new tendencies that HRM has to improve in the following years in order to be competitive in the market.The purpose of this essay is discuss the above questions through theories and models; also give some examples about the characters of the Australian workforce, their environment and the challenges that HR management is facing today; the essay also will discuss the necessity of strategic human capital management and some requirements such as ethical, legal and OHS; and lastly, Discuss which are the competencies that HR executives need in order to become strategic partners for the companies.The Australian population is one of the most successful multicultural populations around the world. The composition of the population is being changed, its composition causes changes in the workforce behaviour (De Cieri 2005, P. 12), however, the worldwide labour market is experimenting a shortage of skilled people. Changes in the population composition is the main reason of the lack of skilled people in Australia. The ageing workforce is the consequence of shifts in the Australian population, for instance, while older population is growing through last ten years (De Cieri 2005, P. 2), young population is decreasing compare with the proportion of adult population in Australia. De Cieri claims that there was the labour composition in countries such United States and Canada, they are countries which have the same problem such Australia and there is the difference in population composition between Asian countries and Australia. There is an interesting issue that drives the research in the composition of workforce in Australia and also how through modern theories can be improved.The composition of the labour force has an internal-external relationship, employers select employees from a external market through recruiting and selection practices (De Cieri 2005, p. 13). The external labour market is composed by people actively seeking employment. The internal labour force determines the need of training and development practices and the effectiveness of the company’s compensation and rewards. In the case study, human capital: the state of the play in Australia (De Cieri, H et. Al. 008), The efficiency is the main focus in Australian organizations, the management of the people is not enough important for many industries, the worker, the employee which are craftsmen of profits and jobs. The 21th century brings a new challenge in order to redirect the general management of the organizations, the work force management has to be focused in supplying the demand of employees to be more prepared and with the necessary abilities for the competitiveness and the new challenges of today’s companies. Today’s human resources management is experimenting with great changes around the world.Modern theories proposes perspectives of human resources management such as behavioural view, resources-based and political-influenced views (De Cieri, 2008). In particular, the Australian work force has been managed in a human capital behaviour organization. Its approach refers to people which have the abilities, skills and expertise to perform its job in the most efficient way (Charmaine, 2007). Its organizations become well developed in the same way that their employees are capable to maintain a competitive advantage.In spite of the organizational behaviour of Australians companies, the achievement of these organizations is to leave their processes to the next level which is the effectiveness of the HR function (De Cieri 2008, P. 43). In order to be effective, Australian organizations requires SHRM implementation which has differences compared with HRM approach. Australian organizations are away compared with American organizations, the challenge is going to the next step of the process which is business transformation outsourcing (De Cieri 2008, P. 43).Organizations requires more effort in talent management in order to recruit and retain this talent, this is the challenge of the companies to be successful. Australian organizations has problems to retain their best human resource, in spite of the plenty offer from Asia and other parts of the world, Australian companies have good reputation in recruitment and management but the real issue is the retention of this talent in both internal and external ways. Australians need to become global in the competition for people (De Cieri 2008, P. 3). Nowdays, Australia have diverse workforce. Work force diversity is a group of people which shares one same identity but keep individual characteristics such as race, language, age, gender, between other characters (Charmaine E 2007, P. 152). The most interesting issue of the Australia labour market is that there have higher rates of employment and low rates of unemployment, in recent times, casual and part time job is an frequent companies offer (De Cieri 2008, P. 59). For instance, students become an important workforce, they are allowed to work 20 hours per week and its expectation is find one job that helps to enhance the life in Australia (Nyland C, 2008). The Australian labour force has been composed by white females, through recent years its composition has changed mainly because of immigration policies which has been given people from different cultures (Charmaine 2007, p. 153).At the beginning, people from Europe, Mediterranean region, and Europeans mainly made up workforce in Australia. Its workforce started to increase when people from another regions such Asia, western Europe and Africa migrates to Australia making more diverse and increasing the multicultural heritage (Charmaine 2007, P. 153). Inside of organizations its diversity provoke the creation of multicultural legislation in order to bring equal employment opportunity and push government to create fair work legislation (Charmaine 2007, P. 55). for instance, many companies that have implemented diversity strategies have improved their business performance (Stone 2005, p. 704). Australia is the first country which perform the maternity leave, they found that performance has increasing, Westpac Bank was the first organization that implements this kind of benefit and its five years of implementation, the company can save profits for about six million just only increasing the rate of maternity leave (Stone 2005, p. 704).On the other hand, Australia has examples of failures applying diversity strategies. Indigenous Australian have more than 60. 000 years living in the country compared with European settlements which data from 1778. The negative impact of these settlements were reflected in the aboriginal population which was marginalized in a social, economic, political and cultural way. The consequences of these discrimination were reflected in unemployment, health and housing problems and also lack of literacy.These issues provokes that aboriginal people have problems finding jobs, its participation in the Australian Workforce is almost insignificant compared with overseas migrants or even Australians workers (De Cieri 2008, p. 17). There are challenges that Australian organizations facing nowadays, for instance, strategic human capital management is one of the most challenge issues for they, this management has to include ethics inherent to these strategies. There are Issues such as sexual harassment, fraud, breaches, favouritism and other issues that today’s organizations are facing (Charmaine 2007, p. 85). In order to deal with multicultural human capital, managers has to understand that every person has their own idea about the ethics and this ideas determines the behaviour of each person even in the work place. There is an issue for the manager because the same things that in some countries are accepted does not mean that in Australian organizations has to be accepted. For instance, en central and south America, bribery is a part of the culture and people expect that some government employees and officials deal in this manner with some issue and complaints (Charmaine 2007, p. 86). This behaviour in Australian organizations are not accepted in the same way and managers has to deal with this habits all days, it is a challenge in order to reach equity in the work place. In order to deal with this behaviour, managers and organizations have a moral responsibility not only with the society but with the stakeholders as well (McManus, 2009). Organizations has the obligation of including ethics inside of the business as a part of the management general strategy.Barnard (1938, Cited in McManus) states that there are functions of the executive that has to be considered; these included the management of individual and corporate goals. The author also suggests that the management process is not only an intellectual process but it involves ethics and moral processes; Australian organizations have a moral responsibility to those they serve and also the responsibility of managing workforce in order to reach the organization target. There are many ethical decision-making models that Australian organization can follow.For instance, deontology, virtue and justice ethics, ethical relativism and ethical pluralism are principles that today’s organizations practices as a influence or their own work environment (De Cieri, 2008); One of the most common ethical decision-making model is the Bommer, Gratto, Gravinder and Tuttle model which consider an internal and external environment (Charmaine, 2007). The subject takes decision based-on environmental factors, each person has their own scale of values for these factors; its factors have a degree that the person which takes the decision put in a particular order.External factors such as social issues, work environment or individual attributes which can affect decisions subject and internal factors such as the moral level, personal goal or life experience. “the decision-making process itself consist of information, cognitive process and perceived rewards and losses”. Then after all factors were considered, the decision is performed according with the idea of ethical an unethical action is (Charmaine 2007, p. 192).In essence, the process is only a process of listing advantages and disadvantages of a decision then person perform a evaluation about which option is better according with which one have more advantages than disadvantages (Charmaine 2007, p. 192). Kevin Brown is the executive general manager of Qantas. In their speech in the past annual conference in the Australian Human Resource Institute in Melbourne, was facing an ethical issue as Qantas operations concern. The issue is that company was considering the reduction of its information technology platforms.Brown said that the decision was based on the reduction of 400 cabin crew jobs that was on operation in London. The diminution produce savings for about 20 million in one year thanks to reductions in hotel and working hours expenses. The Flight Attendance Association argued that its cut was against employ offer and stability from Qantas HR management but Brown answer the argument saying that for the company was better keep 6000 staff working mainly in Australia and perform reductions outside of the country and the strategy was placed in London (De Cieri 2008, p. 74). It is clear that the example shows an small making-decision process which have two basic elements, external elements such as Australian employment overview and internal elements such as maintenance of staff already working in the company. There is the decision making process that today companies are facing daily. However, there are some repercussions in the organizations, Australian organizations suffer because of the HR issues in a globalized world.The HR market is always watching competitive organizations, and it is crowded all time of examples but organizations also does not have clarity about what is the main skills that organization requires. Organizations requires a change in the thinking way, they has to be less focus on the performance pay and if is the worker fit or not with the requirements of the job. ‘let’s not focus on the HR process for process’ sake, but let’s focus on how we can improve productivity across our work force. Said Bill Farrell who is the IBM’s Asia-Pacific Leader for Human Capital Management (De Cieri 2008, P. 43). In overall, Human resources management are procedures and policies which affects employee behaviour attitude and performance, human resources also recognises that people are important in both financial and physical resources. (De Cieri 2008, P. 5) There are perspectives which should be useful in order to change the way that human resources is managed in today’s organizations.Australian organizations can apply one of the different actual perspectives such as behavioural perspective that proposes a new link for human resources management, its link is their objectives joint together with organizational strategy or resources-based perspective which gives more value to employee knowledge, skills and abilities or political-influence which is an examination of the effects of the political factors on HRM practices. For instance, the most popular approach around the labour world is the resources-based perspective.HR executives of today companies need a kind of skills in order to be more strategic and less resource-based manager, there is a paradigm which would be difficult to brake, “HR managers which have the skills that can convince the business of the value of transformation; can recognise that skills and capabilities in HR can change if needed; and can harness technology – thus becoming effective strategic partners and making a positive contribution to the continuing success of the organization” (De Cieri 2008, p. 58). Storey and Thus claims that the centre of attention of HRM is on managing people within the organisation and hunt for strategic integration of HRM practices with business plans (1992, cited in Krishnaveni and Sripirabaa, 2008). In order to defining features of an effective HR manager, there are some characteristics that can be explain the features; for instance, effective SHRM has to be more company culture follower (Charmaine, 2007).If we consider an example of one company which see one competitor using an email and communication software that is used to collaborate and remain communications between partners in order to share information and actively collaborate with other projects. Its example can have two interpretations: the first one is that the reason why the competitor is using the software is because of the technology or, the second one is that the reason why this software is working for this competitor is a consequence of organisational culture of collaboration and knowledge sharing (Charmaine 2007, p. 399).The last example describes one of the skills that effective SHR practitioner has to be which is good communications skills. The effective SHRM is a person which understand the dynamism of the organisational behaviour. The company is a system that has to be reviewed frequently because of the components, its components are linked each other also the components changes frequently. The strategic human resources management is a continuous and dynamic evolution process, it is not a static and sometimes boring group of functions (Charmaine, 2007). The effective SHRM is also a good understanding of the values and culture in the organization.Kirn says that the principles and attitude of an organization have been linked to organizational achievement (1999, cited in Charmaine 2007, p. 405), The HRM system is a consequence of the type of values and beliefs that employees shows inside of the organisations through their attitudes (Charmaine, 2007). For instance, companies that are interested in the implementation and commitment of strategic human resource management develop relations between companies and universities in a collaborative relation called partnerships can play an important role in the future development of this concept (Baill, 1999).Barbara Baill is the Vice President of Human Resources for Quantum Corporation’s hard disk drive business. Five years ago, Quantum was approaching $2 billion in annual profits, the staff was approximately 2,500 persons working mainly in Milpitas, California. Today, Quantum’s profits exceeds $5 billion with 7,500 staff members around the world, the company shows a amazing growth, not only in profits but also in the number of members in other company places, now two-thirds of employees are outside of Milpitas, and business complexity is different (Baill, 1999).Through the development of the both company and HR function changes, both moves from a focus on functional basics such as employment, reward, repayment, and employee relations, to the “new model” which required renovation in all parts of the task. The two key areas of transformation for HR managers of the company were: first area was the developing of the organizational skills and the second area was the building a stronger understanding of the business in order to contribute as a business partner (Baill, 1999).In summary, the Australian workforce is characterised for being multicultural, its character brings wide possibilities of growth in different areas such as international relationships. Companies that develop multicultural workforces can understand differences between cultures and its understanding can be transformed in profits because products and services that are develop down these characters should be suitable to different countries in order to satisfy the necessities of wide type of customers.That’s why, multicultural workforces can be challenging for Australian Companies. Also companies can improve their human resource retention through strategic human resource management involving employees in the commitment of targets and goals that company will pursue. The need of strategic human resources management is the consequence of internal factors such as population, economics, work force, between other, and external factors such as migration policies, government laws, international economies.The HR managers that have to deal with these changing conditions, need the implementation of strategies in order to combine the objectives of the company with the business strategies. Strategic partner is the essential part of the management team that is capable to run an organization trough the succeed integrating both objectives and business strategies simultaneously into action (stone 2005, p. 9). The competencies that HR executives can be shown are good problem solver, good communications skills, well understand the business and flexibility.

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