Reuters Company Profile: Whole Foods Market. Retrieved on November 7, 2012 MGT8034 Assessment page 4 © University of Southern Queensland Case study 2 Description Marks out of Wtg(%) Due date Case study 2 (2000) words) 100 40% Wednesday, 25 January 2017 (approximately 5 typed pages single spaced) You should write the case study in such a way that you start your answers from line 1. That is, there is no need for large introductions that we see in essays. You should apply the principles you have learned from lecture material/tutorials/readings that are specific to the case study. Case study 2 answers should be written in narrative form (i.e. sentences not bullet points), and should be 2000 words long, single spaced. Each case study should be referenced and show evidence of recommended readings as set out in the Guidelines to Case Study 2. You should use a minimum of 10 references for your case study. Questions for the case can be found at the conclusion of the case. Individual case study 2 You need to clearly demonstrate how you will solve the following problem. Problem statement: Vesna Bladzik is a highly intelligent person with an undergraduate degree in business from Boston and a Masters degree in Communication from USQ Australia. At a recent interview for a position in one of Google's worldwide locations (Atlanta, USA), she uses her superior communication skills to convince the selection panel of her ability in applying for a Communications Managerial role. Approximately 2 weeks later, Vesna started work and spent the first 2–3 months analysing and assessing how to do her role. After 6 months, her managers started to worry somewhat when she showed a real 'lack of experience' in assessing employee skills from performance reviews. This followed other concerns that she was 'slow' in applying much needed training functions to staff that showed gaps in their skill base; also, she had recommended 10–15 redundancies from her total staff of 50. This was based on the assumption that staff was not performing to previous performance standards as set out in annual performance reviews. After some time, her manager, Nick Price, realised that despite her communication ability, there was a large disconnect between this and her overall management experience. However, he felt that Vesna should have more guidance on certain aspects on HR. In particular, he decided that he would ask you as a Google HR Director (High Performance) to assist Vesna in 'bringing her up to speed' on strategic HRM. After you complete some brief reviews of her role, you discover that she is doing too much evaluation on her own with little or no advice from HR. Therefore, you decide that she requires practical advice and some practical skills related to implementing 360 degree feedback assessments. She also requires skills related to understanding the strategicMGT8034 Assessment page 5 © University of Southern Queensland aspect of Redundancy as distinct from Downsizing. Rather just 'talk about theory' to her, you decide to do some basic designs/charts for her illustrating 360 degree feedback and redundancy. You realise that despite her qualifications, she needs to understanding the difference between old fashioned functional HR and strategic HR. While redundancy is often the first lever managers reach for in restructuring their departments/divisions/businesses, you realise that she needs to know how staff are 'really' assessed and that in the assessment process a strategy will be worked out to clearly improve employee skills as valuable resources. Required: Assuming less than perfect information where you may need to fill in the 'facts' by adding more assumptions that will help in solving case facts, you are required to: 1. Advise Vesna about the practical aspects of theories in relation to 360 degree feedback and strategic redundancy versus downsizing; 2. Explain how Vesna can implement these ideas given the facts in the case with a design or a chart that illustrates the concepts and how to apply them. What else should Vesna consider before embarking on redundancies? 3. Include in your answer to Vesna a one page summary of the facts in relation to ideas about how she can move forward, what strategies will be important, and how she can address key skill problems and use performance management strategies in ways that will advantage her workers. Note: Please use all theory based on the readings in Module 3 and 4. Please use both the set text and the readings. More marks will be gained by students showing adequate evidence of readings in their case answer. Please use the Style Guide Referencing advice below for quoting and listing references.MGT8034 Assessment page 6 © University of Southern Queensland Marking guidelines and criteria The general marking criteria we will be using for the assignment is as follows: Case study 2 assessment criteria Extensive Minor Evidence Evidence 10 9 8 7 6 5 4 3 2 1 1 Overall quality of analysis addressing the major themes and issues 2 Quality of assumptions and facts proposed in addition to case facts 3 Critical analysis of the literature relevant to solving case problems 4 Quality of one page advice summary 5 Quantity of your research – did you collect enough information and write enough to explain the problem and its solutions 6 The overall structure and logical development of your case report Communication aspects of your presentation 7 Referencing 8 Writing clarity 9 Tertiary standard: does your case study reach a high standard of research, analysis and writing? 10 Overall, your report is worth MGT8034 Module 4 – Making innovation work in and for organisations page 1 © University of Southern Queensland Module 4 – Making innovation work in and for organisations: mainly managerial and human resource related issues and perspectives Objectives On successful completion of this module, you should be able to: ● analyse and critically discuss the interrelationship between creativity and innovation ● analyse and engage in critical dialogue about the challenges and dynamics related to enhancing innovation through structures, organisational culture, systems, processes and other and managerial practices and dynamics ● analyse and critically discuss connections between innovation and aspects of human resource management strategy, functions, practices and organisational culture ● analyse and critically discuss aspects related to reviewing, measuring or/and assessing and learning about improving innovation in organisations ● analyse and critically discuss the nature and potential value of evaluating aspects related to SHRM. Learning resources Text Davila, T, Epstein, MJ & Shelton, R 2006, Making innovation work. Millmore, M, Lewis, P, Saunders, M, Thornhill, A & Morrow, T 2007, Strategic human resource management. Selected readings Reading 4.1: Csikszentmihalyi M 2006, 'A system perspective on creativity', chapter 1 in J Henry (ed.), Creative management and development, SAGE Publications Ltd, London, pp. 3–17. Reading 4.2: Mauzy, J & Harriman, R 2003,'The dynamics that underlie creative thinking', Creativity Inc., HBS Press, Boston, pp. 11–30. Reading 4.3: Bills, T & Genasi, C 2003, Creative business, Palgrave-McMillan, New York, pp. 62–72.MGT8034 Module 4 – Making innovation work in and for organisations page 2 © University of Southern Queensland Reading 4.4: Morris, MH, Kuratko, DF & Covin, JG 2008, 'Human resources and the entrepreneurial organization: the creative individual', chapter 6 in Corporate entrepreneurship & innovation, Thomson South-Western, Mason, Ohio, pp. 137–49. Reading 4.5: Kassulke, A 2006, 'Building a creative company', Management Today, August, pp. 24–7. Reading 4.6: Zdunczyk, K & Blenkinsopp, J 2007, 'Do organisational factors support creativity and innovation in Polish firms?', European Journal of Innovation Management, vol. 10, no. 1, pp. 25–40, viewed 1 September 2009, Emerald Management Xtra. Reading 4.7: Salaman, G, Storey, J & Billsberry, J 2005, 'Achieving 'Fit': managers' theories of how to manage innovation', chapter 5 in Strategic human resource management: theory and practice, SAGE, London, UK, pp. 91–113. Reading 4.8: De Jong, JPJ & Den Hartog, DN 2007, 'How leaders influence employees' innovative behaviour', European Journal of Innovation Management, vol. 10, no. 1, pp. 41– 64, viewed 1 September 2009, Emerald Management Xtra. Reading 4.9: Dobni, CB 2008, 'Measuring innovation culture in organizations', European Journal of Innovation Management, vol. 11, no. 4, pp. 539–99, viewed 1 September 2009, Emerald Management Xtra. Reading 4.10: McColl, G 2005, 'Culture breeds ideas', BRW innovation Issue, June 16–July 13, pp. 54–7. Reading 4.11: Imber, S 2008, 'Think outside the square: HR and innovation', Human Capital Magazine, no. 6.4, 12–14, viewed 17 August, . Reading 4.12: Zheng, C, O'Neill, G & Morrison, M 2009, 'Enhancing Chinese SME performance', Personnel Review, vol. 38, no. 2, pp. 175–94, viewed 1 September 2009, Emerald Management Xtra. Reading 4.13: Morris, M, Kuratko, D & Covin, J 2008, 'Human resources and the entrepreneurial organization: the organizational perspective', chapter 7 in Corporate entrepreneurship & innovation, Thomson South-Western, Mason, Ohio, pp. 164–82. Introduction Earlier you were introduced to some of the fundamentals related to innovation. Your attention was specifically drawn to the potentially important role to be played by innovation and to the connections and potential interplay between organisational performance, strategy and innovation and human resource management. It has been emphasised throughout this course so far that an integrated approach, one which emphasises the interconnectedness between various organisational elements and subsystems, processes and practices, is arguably an important characteristic of a strategic approach to managing organisations. In the previous module we specifically looked at aspects of strategic human resource management and how these might link up with things like organisational performance and competitiveness. You are challenged throughout to make linkages to innovation-driven organisational strategies and practices. Our focus now moves deeper into the realm of innovation. We start off by taking a closer look at creativity as the cornerstone of innovation. In this module you get theMGT8034 Module 4 – Making innovation work in and for organisations page 3 © University of Southern Queensland opportunity of making a more in-depth study of how to go about harnessing and developing creativity and building innovative organisations. You are specifically again challenged to make the relevant people, HRM and organisational performance connections as well. You know by now that there are schools of thought according to which innovation is recognised as a potential organisational strategy in its own right. There are however competitive strategies that that are not so much innovation-driven necessarily – but in which aspects of creativity and innovation will nevertheless offer possibilities to add value. The success of organisations in this knowledge era seems to be very much people-based and therefore the relationship between strategy and HRM strategy and practice is important. It is people who are creative and the potential for innovation thus always come from people. That is also why any form of innovation-driven competitive modes of organisations will be quite strongly people-based. This is so partly because creativity forms the foundation of innovation. Morris, Kuratko and Covin (2008, pp. 137–8) say that creativity 'can be defined as the application of a person's mental ability and curiosity to discover something new … creativity is the capacity to develop new ideas, concepts, and processes'. It should hence be clear that the creativity-innovation link makes innovation-driven strategies strongly humancentred. As Chell (2001, p. 225) puts it, at the end of the day 'innovation is down to the performance of people, individuals and teams …', and later also (Chell 2001, p. 233), 'innovation leads to better performance, it gives business a competitive edge … enabling it to outperform its competitors … A critical management problem therefore is how to deal with the human and organisational aspects of innovation'. Cascio (1998) also makes it clear that innovation-driven organisations must know that this has particular implications for the way that people are managed. Organisations who place a premium on innovation have to pay due attention to the way that they design organisations and structure the work of organisations (hence at all three levels – individual, group and organisational), to the recruitment and selection of people to become part of its pool of 'human resources', to the way that people are deployed, utilised, developed, rewarded and retained, and in particular also to the way they develop the culture and climate of their organisations – in order that all would be conducive to strategy execution, performance and competitiveness through innovation-driven processes, practices, structures and systems. As you reflect back on what you have covered in the previous module you are thus encouraged to make those connections between all the HRM and SHRM aspects and organisational innovation (and creativity). 4.1 The creativity-innovation connection You have already been introduced to the interplay and relationship between creativity and innovation. We'd like to stress this point here once again. It is hard to think how there can be innovation without creative ideas. Innovation requires some creativity. Therefore, creativity and innovation go hand in hand – but as you've learned, these are not the same phenomena. You have already been exposed to what innovation means. But what is creativity? Bills and Genasi (2003, p. 1) say the following: 'It's a slippery concept, creativity: every time you get close to coming to grips with it, it seems to slip away, as indefinable as ever…The notion of creativity means something different from one individual to another'. It's not all that easy to define the concept 'creativity' – but the one offered in the introduction seems pretty useful. You'll read it again shortly. Before we go any further, we want you to engage in the activity below:MGT8034 Module 4 – Making innovation work in and for organisations page 4 © University of Southern Queensland Learning activity 4.1 Sit back and think about the word 'creativity'. What things come to mind? Write down only words or phrases that you associate with the word 'creativity' (use the space provided below for this purpose). Now take a careful look at what you have written down. Reflect on it and attempt to formulate your own definition of the concept 'creativity' – come on; be creative when you do this!!! We are all familiar with creativity. We have all been creative to a greater or lesser extent in our lives. We will all be able to make some associations with the notion of creativity. If we were to compare our associations (the words and/or phrases that we've listed in the foregoing activity), we'd probably find a very wide range of things that have been listed. Yes, there are diverse issues related to creativity. Things that may have come to mind might include (and these are just a few) art, innovation, invention, originality, new, artists (perhaps the names of some prominent ones like Leonardo Da Vinci), etcetera. So then, if there are so many different things that relate to creativity and if it means different things to different people, why bother to even attempt to define it, you might ask. After all, as Mauzy and Harriman (2003, p. 11) put it: 'One can be creative without understanding the underlying dynamics as much as one can drive a car without understanding how the engine works'. And just think about it a while: we all tended to be creative as children. Think of your days as a youngster. Just observe when children play – especially toddlers and early school going children. Just look at the imagination at work when children play – creating their own little fantasy worlds. They do not understand a bit about the 'nature' of creativity, and yet, they show us huge amounts of the 'practice' of creativity. And this is probably where the educational dimension comes into play. We often have to channel these creativities into the appropriate direction – otherwise it may turn out that the creativity of children may lead to dangerous and perhaps even sometimes life threatening practices. Does this make any sense to you? Well, this course forms part of an advanced educational programme and it is therefore essential that you are exposed to some of these 'mechanics' of what creativity is and how it works. In addition, because the study of business and management entails an encounter withMGT8034 Module 4 – Making innovation work in and for organisations page 5 © University of Southern Queensland applied sciences, it is important that you not only learn about how creativity works, but also in particular what can be done to enhance creativity – at a personal level and in an organisational context. So then, let's move on to explore what 'creativity' as concept means. Coulter (2003, p. 52) explains that one of four critical success factors for succeeding in today's economic world is the ability to be creative and she explains that creativity is the ability 'to combine ideas in a unique way or to make unusual associations between ideas'. Zimmerer and Scarborough (2002, p. 37) define creativity as 'the ability to develop new ideas and to discover new ways of looking at problems and opportunities' and they go on to explain that creative thinking 'has become a core business skill, and entrepreneurs lead the way in developing and applying that skill…creativity and innovation often lie at the heart of small companies' ability to compete successfully'. It can be seen that there are striking similarities between these definitions. Keep in mind, however, that all these definitions come from similar 'discipline' perspectives. Although it is true that creativity can be defined from the angle or viewpoint of different disciplines, and not only the business or psychological perspective, it should be rather clear from what we have already offered up to now that creativity has a lot to do with how people's brains work, their thinking styles, thought processes, etcetera. It is very much about ideas and the thinking of people – how the 'knowledge' locked up in the 'human resources' of the organisation can be best utilised and developed. Creativity is therefore also a social rather than a purely individually driven phenomenon. Creativity occurs in a particular context and is hence context-bound. Our interest and focus in this course can obviously be narrowed down to the organisational context. And in particular we'd like to come to some improved understanding of the human dynamics that underpin creativity and innovation in organisations. Keep in mind as you work through the material, that in this course we focus on creativity (and innovation) within the context of organisations, strategy and the improvement of organisational performance – and with a particular slant on the human resource (management) side thereof. However, it is also important to reflect on creativity from a more general social contextual perspective. Reading activity 4.1 You should now read selected reading 4.1 which is chapter 1 (entitled 'A systems perspective on creativity') from a book edited by Jane, Henry 2006, Creative management and development – Note the research finding about the interplay between domain specific knowledge, the creativity of individuals and the field gatekeepers. Do you think some of this may be relevant to creativity and innovation in organisational contexts too? Why/not? You should now have a more clear appreciation for the school of thought that Von Stamm (2003), amongst others, form part of, namely that creativity is an essential element of innovation and that creativity plus (successful) implementation leads to what is known as innovation. Whereas creativity has more to do with coming up with ideas, ideas on their own are not enough – something needs to be done with these novel ideas. Chell (2001, p. 233) also summarises it quite succinctly when it is said that 'whilst creativity is the generation of novel or original ideas at work, innovation is their implementation'. Mauzy and Harriman (2003, p. 145) say that to them, innovation is 'the result, the change in order of things, the solution that comes from the work of purposeful creativity'. As you'll recall from the second module, a key difference also lies in the implementation side of things, as well as the risk factor that also comes into play when creative ideas are to be turned into innovations.MGT8034 Module 4 – Making innovation work in and for organisations page 6 © University of Southern Queensland Von Stamm clearly makes the distinction between creativity and innovation by drawing the attention to the implementation of creative ideas: So implementation is about being organized and about using the methodological and systematic approach...It needs to be structured and cannot be left to chance. Time is of the essence—you need to be fast. Creativity is less straightforward than implementation, it is not about a new process or establishing a new structure. To be creative people have to think differently. To be innovative people have to behave differently. And to be successful organisations have to employ people that think and behave differently… Creativity is about being different, thinking laterally, making new connections… Creativity can be encouraged, not forced. Time is of the essence too, but in as much as creativity cannot be rushed, you need to allow it. Organisations that want to embrace innovation therefore need to find ways of reconciling the tension that lies in the juxtaposition of creativity and implementation. (Source: Von Stamm 2003, p. 3) It should thus be clear that creativity forms a key ingredient of innovation, probably its major building block. As we've said – without creativity there wouldn't be any innovation. Innovation seems to be the bringing to fruition of deliberate and focused efforts channelled towards harnessing creativity and turning these into workable and value-adding outputs. It all starts with creative thinking however. Reading activity 4.2 In this reading activity you are required to read a few more selected readings for this Module. You should first read 'The dynamics that underlie creative thinking' as contained in selected reading 4.2: Mauzy, J & Harriman, R 2003, Creativity Inc. From this reading you would have learned about these authors' views of the four dynamics they believe form the foundation of the creative process. In the next reading you'll be further challenged to consider what can be done, at a personal level, to get creative thinking going towards unlocking new ideas. Next you should read selected reading 4.3: Bills, T & Genasi, C 2003, Creative business, which is chapter 4 from the said book, entitled 'New ways of thinking to unlock breakthrough ideas'. This reading may help you reflect on techniques to actually get the creative process rolling – techniques like taking holiday trips, 'sliding into neutral', 'tight-wide' thinking and purposeful dreaming. Lastly read selected reading 4.4 – the pages extracted from chapter 6 of the book Corporate entrepreneurship & innovation. In this reading, keep in mind the focus of the book which this reading is taken from – namely corporate entrepreneurship, also known as intrapreneurship. Take particular note of the sections on the 'creative process' and 'creative blocks' – and also pay attention thereto that the importance of turning creativity into something concrete is also stressed in this reading. Reference is also made to various creativity techniques. The authors furthermore provide some interesting views on the personality of people who tend to be more entrepreneurial. You will probably also find the section on 'motivating entrepreneurial behaviour' interesting. After you have engaged in reading activity 4.2, we would like to invite you to engage in a learning activity. Byrd and Brown (2003) have developed an instrument they call theMGT8034 Module 4 – Making innovation work in and for organisations page 7 © University of Southern Queensland Innovation-X Questionnaire. We reproduce a slightly adapted extract here in order to allow you to do some self assessment regarding your 'innovation profile'. Keep in mind that this seems to be a very simplistically designed instrument and the scientific or psychometric properties are not claimed to be known. It is meant to facilitate some personal level engagement at this point in time. You are encouraged to now engage in learning activity 4.2. Learning activity 4.2 Assessment instruments, especially self-assessments, have been used for many years in a variety of ways…These instruments have proven to be reliable, but it is up to the individual taking the instrument to be honest with himself or herself in order to obtain accurate measurements. We urge you to be honest when taking the Innovation-X Questionnaire (X marks the spot of the intersection between creativity and risk taking). An implicit assumption of the Innovation-X Questionnaire is that, over a lifetime, people develop a general predisposition toward creativity and risk taking…The scales were constructed with the assumption that individuals will take the inventory when things are 'going well' for them. Although it is possible for a recent traumatic incident in a respondent's life to impact the way he or she scores, the norms are accurate for interpretive purposes. When taking the inventory, don't think too much about the questions or answers. Remember, there are no right or wrong answers – simply different preferences. Go with your first intuition; it's usually the most accurate. The assessment (see Exhibit below) should take about five minutes to complete. Exhibit Innovation-X Questionnaire Strongly disagree Somewhat disagree Somewhat agree Strongly agree 1 2 3 4 5 6 7 8 9 1. I feel free not to do what others expect of me. 2. There are a variety of solutions to every problem. 3. I will risk a friendship in order to say or do what I believe is necessary. 4. Inventors contribute more than political leaders do. 5. I feel free to show both friendly and unfriendly feelings to strangers. 6. Daydreaming is a useful activity. 7. New situations do not frighten me. 8. I often fantasize about things I'd like to do. 9. I can cope with the ups and downs of life. 10. What others consider chaos does not bother me.MGT8034 Module 4 – Making innovation work in and for organisations page 8 © University of Southern Queensland After you have responded to each question, add the numerical value of the responses under each of the headings for the odd numbered questions. Divide this number by five. That is, (1)___+(3)___+(5)___+(7)___+(9)___=___/5=___. This is your risk-taking score. Next do the same for the even numbered questions, like this: (2)___+(4)___+(6)___+(8)___+(10)___=___/5=___. This is your creativity score. Now, plot these scores on the Creatix grid (figure 4.3) as shown in the example in figure 4.2. In this example, the person had a calculated risk taking score of 8 and a calculated creativity score of 6. She plotted herself on the Creatix and learned that she is a Practicalizer. Figure 4. 1: Sample innovation orientation on the creatix Plot your own calculated scores on the grid in figure 4.2.MGT8034 Module 4 – Making innovation work in and for organisations page 9 © University of Southern Queensland Figure 4. 2: Your innovation orientation The table below highlights the key attributes of each of the eight orientations. You can see the differences at a glance and begin to understand a fuller range of creativity and risk-taking perspectives. Are you an innovator? Highlights of the eight orientations Challengers Innovators Have the attitude of 'do it'; if we do nothing we will lose out Have a new idea every minute Take others' ideas and drive them home Think more highly of their own ideas than others' Get excited about new ideas but seldom create their own Always think they can figure out how they can make it happen Can take on too many ideas and not see them to fruition Keep an organisation off balance – not usually a good thing Can hit the 'grand slam'MGT8034 Module 4 – Making innovation work in and for organisations page 10 © University of Southern Queensland Sustainers Dreamers Like stability and do not seek change Can be the creative juices for an organisation as long as they hook up with a type that can drive their ideas Do voluminous amounts of routine work Let most of their ideas die because they cannot figure out how to make them happen Don't like to take chances or offer many ideas Are creative; constantly are coming up with new ways to do things Modifiers Practicalizers Believe incremental changes are okay Like changes, but not too many at once Will frequently improve things by tweaking them Are willing to try something new Like to test the waters before doing anything Will come up with creative ideas, but do not consider this their forte Don't take risks unless they can see the real benefits over leaving things the same Help the organisation continue to grow by pushing it along Synthesizers Planners See possibilities in everything Believe than an idea has merit if it fits within 'the plan' Create by putting things together – things that may even be unlikely bedfellows Come up with creative ideas within known parameters Will drive an idea home, but not at all costs; are more cautious than Innovators Need information and data before taking a risk (Source: Byrd & Brown 2003, pp. 26–9 and p. 44) You should now be starting to develop a better appreciation for the role to be played by creativity in the endeavours of people and organisations to enhance innovation in their organisations. Creativity alone is not enough however. As you would have learned, it blends with aspects like risk-taking and the will and capacity to actually implement and change something, or to do something different in accordance with the new ideas that come from the creative process. In an organisational context it is obviously important to consider how managers can help to tap into creativity that people can offer, in order to bring about innovation that would hopefully be to the benefit of all of the organisation's stakeholders, including customers and the staff themselves, as well as society more generally.MGT8034 Module 4 – Making innovation work in and for organisations page 11 © University of Southern Queensland 4.2 Developing organisational innovation: some general organisational and managerial leadership issues and perspectives The way people behave in organisations is also influenced by things like the organisational culture, the relevant structural configurations, as well as the leadership styles, approaches and abilities of those who are in put in charge of others – the managers. This course is not so much concerned with the theory and practice of leadership (we have other courses that allow for a specialisation in 'Leadership' at postgraduate level, such as MGT8037 Team leadership, MGT8038 Leadership development and MGT8039 Strategic leadership), but management and leadership dynamics will no doubt have an impact on the development of creativity, and innovative organisations. You know all too well by now that in this course we focus on managerial challenges and take the view of general management, rather than that of HR specialist managers only. We take the view that all managers manage people. We also take the view that all managers could potentially be involved in spurring on (or hindering) innovation. Managers have a key role to play in making decisions and choices about a wide range of things that impact on organisational conditions. These may in turn impact on how other staff members behave and also on the extent to which creativity and/or innovation can be successfully harnessed in organisations. We thus regard it as important that you now reflect on how senior managers think about the connections between strategic goals and relevant necessary organisational conditions that could help achieve these. In particular here, the goal would relate to a strategic priority to be an innovative organisation. Reading activity 4.3 You should now engage in reading a few more selected readings. First you should read selected reading 4.5, which is a rather 'light' article (nonacademic) about 'building a creative company'. Note that Lloyd Bond (2006) stresses that we can all be creative. After that you should read selected reading 4.6 by Zdunczyk and Blenkinsopp (2007). You will note that this is a an article based on academic research. Pay specific attention to the factors which they identify from the literature, that influence creativity and innovation in organisations – namely 'environment, 'culture and behaviour', 'strategy', 'structure', and 'support mechanisms'. Note also how these authors weave into their arguments and research the aspects of 'organisational learning' or the 'learning organisation'. Next you should read selected reading 4.7, which is chapter 5 ('Achieving 'Fit': managers' theories of how to manage innovation') from the book edited by Salaman, G, Storey, J & Billsberry, J 2005, Strategic human resource management: theory and practice. Lastly you should read selected reading 4.8, an article entitled 'How leaders influence employees' innovative behaviour'. From all of these readings you'll find quite a bit of 'food for thought' regarding things that may be important for managerial leaders when innovation becomes a key ingredient of the strategic direction to improve competitiveness and performance. These are importantMGT8034 Module 4 – Making innovation work in and for organisations page 12 © University of Southern Queensland readings, as they further cement foundations for what you'll be reading about in the sections to follow. 4.3 Structures, systems & processes, and cultural related challenges and issues: making some innovation connections 4.3.1 Structure & design, and innovation You know by now that different organisational strategies often go along with organisational design forms that match or fit those strategies. Strategies that have innovation at their core therefore have to be matched up with structural design configurations that would be conducive to the successful implementation or execution of these strategies. On the other hand, organisational design or redesign (and hence restructuring) can in itself be the catalyst for incremental strategic change towards making organisations more innovation-driven in general – and hence an organisational strategy built around innovation may in this way emerge over time. Reading activity 4.4 You should now engage in reading chapter 4 from Davila et al. (2006). Note how the 'concept into reality' challenge again refers to actually make sure how to convert creativity into innovations really. What are your views on the idea of 'outsourcing innovation'? Perhaps you can engage in some discussions on the electronic platform in this regard. 4.3.2 Systems to facilitate the innovation processes in organisations In most (especially larger) organisations, innovation does not simply happen spontaneously. Most scholars and expert practitioners agree that innovation has to actively managed and pursued – and for this to actually 'happen, various policies, processes and other mechanisms may be required to enable strategy execution'. Reading activity 4.5 You should now engage in reading chapter 5 from Davila et al. (2006). Take note of the objectives with well-developed innovation systems and pay particular attention to the issue of making decisions about the appropriate systems and ensuring these are well-designed and developed. Davila et al. (2006, pp. 137–8) also make comparisons between systems that are geared towards incremental innovation, and those geared towards radical innovation. Also take note of the role of electronic systems to facilitate collaboration in order to promote innovation in the organisation.MGT8034 Module 4 – Making innovation work in and for organisations page 13 © University of Southern Queensland 4.3.3 Culture and innovation You would already have picked up that organisational culture plays a key role in driving innovation in organisations. Now it is time to read in a little more detail about this from your one prescribed book and two more selected readings. Reading activity 4.6 You should now first read chapter 9 in Davila et al. (2006) and then selected readings 4.9 and 4.10.You will note the latter is a more 'practitioner' and the former a more 'academic' article. The important thing is that both the article by McColl and chapter 9 in Davila et al., stress some important HRM functions, including the role of things like recruitment and rewards. In the next section we return to look in some more detail into various additional HRM aspects that are connected with innovation, including rewards. As you would have picked up by now – the structural and cultural dimensions hold important potential implications for and seem to thus interplay with each other and also with how organisations approach the management of their human resource factor. This seems to make for a rather complex web of interconnected strategic, structural design and human resource management processes, practices and systems. It is not always easy or even desirable necessarily to place different factors, issues or challenges in particular categories. This is done primarily at a conceptual level to facilitate the learning process. As mentioned, there seem to be complex and interrelated dynamics at play when we are working with these sorts of things in practice, and also in theoretical terms. A key challenge of this course is exactly that you should come to terms with some of these complexities and develop a better understanding of the challenges related hereto. This requires some holistic and integrative thinking. We now turn to take a closer look at some HRM aspects. 4.4 HRM and innovation: a closer look at some of the potential interplay As we have stressed earlier, HRM is very much also the responsibility and job of all line managers. That does not mean though, that the HR specialist practitioners and the functions they perform have no role or place in organisations. Similarly – the HR specialists can also do a lot to enhance innovation – including being more innovative in terms of all their own work as HR practitioners. In this regard it is time for some more reading again now.MGT8034 Module 4 – Making innovation work in and for organisations page 14 © University of Southern Queensland Reading activity 4.7 You should now read selected readings 4.11, 4.12 and 4.13. You'll note that reading 4.11 seems initially to be taking the narrow view of 'HR' – limiting it mainly to the role of the 'HR department' of organisations. Later on it becomes clear that they 'blur the lines' as well. While you know all too well by now that we take the more holistic view in this course – that does not mean that we should neglect the role to be played by HR specialists in respect of innovation in organisations. This article by Amantha Imber can be regarded as some light introductory reflections on the theme relating to the interplay between HRM and innovation. Selected reading 4.12, in turn, is a much more 'targeted' research paper/article – revolving around innovative HR practices found in Chinese SMEs (small and medium enterprises), as per the study in point. Selected reading 4.13 is another extract from the book Corporate entrepreneurship & innovation by Kuratko et al. (2008) – this time Chapter 7. This should be found a very useful overview in respect of the connections between a relatively broad spectrum of HRM aspects – and the furthering of creativity, innovation and an 'entrepreneurial' work and organisational environment generally. Note the emphasis placed on the role played by linking rewards appropriately with getting creative and innovative behaviour at work. In fact – you would have picked up on the importance of these aspects throughout your readings thus far. In Davila et al. (2006) the whole of chapter 7 is devoted to this important aspect. You should now read chapter 7 from Davila et al. (2006). Make your own notes and summaries – and perhaps even engage in some discussion about this theme on the electronic discussions platform for this course. 4.5 Some measurement and evaluation related challenges pertaining to innovation and SHRM Throughout this course thus far we have emphasized that the overall aim with a strategic approach to managing human resources and innovation would be to add value to the strive towards making any organisation more successful. This therefore goes right back to the issue of organisational purpose and the portfolio of goals that an organisation might pursue. A key question that may arise thus relates to how one might know what contribution is being made or value is being added to this by the actual strategies, systems, structures, practices, etcetera that are aimed at the optimal deployment, utilization and development of human resources for innovation-driven organisations. This whole course has been devoted to examining how the human resource architecture of organisations can be managed strategically in order to enhance the innovativeness of organisations for greater competitiveness and overall 'performance'. By 'HR architecture', as we might have explained before, we mean the sum total of the human resources system of an organisation. In other words, the way in which the organisation's infrastructure for work is designed (organisation design, work systems and employment models) and managed (including the line managers as well as the specialist HR professionals), the human resources (the staff, personnel or workforce and all they have toMGT8034 Module 4 – Making innovation work in and for organisations page 15 © University of Southern Queensland offer, including in particular their 'knowledge' and creative and innovative potential and abilities), how they are managed (by line managers as well as the role of the HR specialists) and their behaviour and performance, as well as the whole HRM function (or department) and its systems, structures, processes, procedures, policies, activities, functions, practices, etcetera. An important challenge thus relates to the ability to generate, find and utilise information that reflect the extent to which this HR architecture of an organisation helps the organisation to be more innovative and to perform, survive, compete and be successful in general. Such information will ultimately be needed in order to improve the performance of the organisation in terms of innovation and also in particular in terms of the role of the HR architecture in all of this. In this last section that concludes this course, we shift our focus to some aspects related to the measuring and assessing aspects of innovation and HRM in organisations – all with the aim of learning from this and to try and keep improving things. 4.5.1 Measuring, assessing and improving innovation Reviewing and reflecting on the performance of an organisation is common in areas that have traditionally been more directly associated with the 'bottom line' of organisations – the turnover, growth, market share, profitability, ROI, etc. of organisations. As we have clearly spelled out in the second module in particular, organisational performance is however a multi-dimensional construct. One should take a balanced look at the performance of organisations, not only focusing on traditional bottom line results and achievement, but also in particular reviewing and reflecting on the performance of the drivers of such results and outcomes. In this course the focus has been on innovation as a key driver of organisational performance. Reflecting on and reviewing the performance of an organisation in relation to innovation thus requires some measurement of success, some auditing of innovation management – in order to learn how well performance is in this regard and, more importantly, to use such learning to improve the innovation performance of the organisation. Reading activity 4.8 You should now first read chapter 6 from Davila et al. (2006) and then selected reading 4.14, which is taken from the book by Tidd, Bessant & Pavitt (2001). The latter shows how aspects like benchmarking and various performance measures and indicators and a comprehensive innovation management audit can be used to measure, assess and evaluate the state and performance of the organisation in relation to innovation. Davila et al. (2006) cover aspects like a balanced scorecard for measuring innovation, barriers to effective measurement as well as how to design and implement innovation measurement systems. Next you should read chapter 8 from Davila et al. (2006) – which focuses on how to leverage 'learning' to enhance innovation in organisations. Ultimately we measure, assess and evaluate in order to learn from that so that we can improve things. This holds in respect of innovation as such – as well as HRM and SHRM.MGT8034 Module 4 – Making innovation work in and for organisations page 16 © University of Southern Queensland 4.5.2 Evaluating aspects related to SHRM As you have learned throughout this course, there has been increasing trends towards acknowledging the value added by the intangible assets of organisations, and in particular that which is locked up in the 'human side' of organisations. The net result of the HR architecture is to improve organisational performance, competitiveness and success through HR-related outcomes that add value. In the context of an innovation-driven organisation this also hence means the contributions made hereto via the enhancement of the innovativeness of organisations. It thus goes without saying that one will have to 'measure', 'assess' or 'evaluate' the actual state and quality of contribution and value added by the organisations' HR architecture – to innovation and more importantly to the ultimate and overall performance of the organisation. The information in this regard and processes related to gathering, using and presenting of such information form the focus of this section – as captured in chapter 4 of Millmore et al. (2007). Reading activity 4.9 You should now read chapter 4 of Millmore et al. (2007), entitled 'Evaluating SHRM: why bother and does it really matter?'. Engage in the self-check and reflect questions throughout the chapter. Conclusion In this module we have more pertinently considered a range of dynamics, challenges and issues pertaining to the enhancement of creativity and innovation in organisations. The idea of exploring the creativity-innovation nexus provides an important foundation for considering organisational constituents of innovation such as: organisational structure, design, work structuring, employment configurations, human resource management functions, practices and systems and also how general management processes and the management of ideas and projects may interplay with innovation. The nature of creativity and the creative process is critical for innovation driven strategic options in organisations. We paid specific attention to what can be done to develop innovation in organisations. The relevance of things like leadership as well as a range of human resource management functions, strategies, policies, practices etcetera were considered in the context of creativity and innovation in organisations. The module concluded by challenging you to also consider aspects related to measuring, assessing and evaluating aspects related to SHRM as well as innovation management, including the role of learning in this regard. Reference list Bills, T & Genasi, C 2003, Creative business, Palgrave-McMillan, New York, pp. 62–72. Byrd, J & Brown, PC 2003, The innovation equation, Jossey-Bass/Pfeiffer, San Francisco.MGT8034 Module 4 – Making innovation work in and for organisations page 17 © University of Southern Queensland Cascio, WF 1998, Applied psychology and human resource management, 5th edn, Prentice Hall, Upper Saddle River, NJ. Chell, E 2001, Entrepreneurship: globalization, innovation and development, Thomson, London. Coulter, M 2003, Entrepreneurship in action, 2nd edn, Prentice Hall, New Jersey. Mauzy, J & Harriman, R 2003, Creativity Inc, HBS Press, Boston, pp. 11–30. Morris, MH & Kuratko, DF 2002, Corporate entrepreneurship, Harcourt, Orlando. Von Stamm, B 2003, Managing innovation, design and creativity, Wiley, Chichester. Zimmerer, TW & Scarborough, NM 2002, Essentials of entrepreneurship and small business, 3rd edn, Prentice Hall, New Jersey. MGT8034 S3 2016 Guidelines to Case Study 2 (Due January 25, 2016) The main guidelines for case study 2 are fairly explicit on pages 4 – 5 of the Assessment document. On page 5, it sets out what is required for case study 2. The style guide for referencing is included on page 7 of the assessment document. Please carefully follow this guideline when quoting books, chapters, journals etc. In addition to the main guidelines, please note the following: 1. Please write up to 2000 words. You may write up to an additional 200 words if you think it helps the main argument you are making; Please quote from the references for module 3 listed on page 53 of your study book. Since case study 2 is addressing performance management, downsizing and redundancy within the context of SHRM and skill development, please examine specifically reading 3.1, 3.2, 3.3, and 3.4. You may also quote and use any other reading(s) you feel is relevant to case study 2. For instance, a relevant reading which you can download by clicking through to the USQ library and e- journals (not available on the study desk) is Farrell, M.A., and Mavondo, F.T., (2005), "The Effect of Downsizing-Redesign Strategies on Business Performance; Evidence from Australia," Asia Pacific Journal of Human Resources, 43(1), 98-115. 2. The relevant chapters from your textbook Millmore et al for case study 2 are chapters 7, 8, 9 and 14. The relevant chapters from your second book by Davila, Epstein and Shelton are chapters 1 and 7. 3. Please demonstrate evidence of your knowledge of at least these specific readings mentioned in point 2 and 3 above throughout your case study answer. Strong evidence in your case study that you have read and understood these readings will increase your chances for a higher mark; 4. In summary, please use the references listed on page 53 of your introductory book plus the chapters 7, 8, 9 and 14 from Millmore et al. Please also use chapters 1 and 7 from the innovation textbook by Davila et al; 5. You should use these references in ways that inform and assist the problem statement you are answering on page 11 of your Introductory Book. Case study assessment criteria can be found on page 13 of your introductory book. Good luck with your case study and I'm looking forward to reading it. MGT8034 Module 3 – Aspects of strategic HRM page 1 © University of Southern Queensland Module 3 – Aspects of strategic HRM Objectives On successful completion of this module, you should be able to: ● the relationship between organisational design and structure, and SHRM ● the connections between organisational culture and SHRM ● challenges related to staffing an organisation strategically ● aspects of performance management, reward for performance and human resource development from an SHRM perspective ● the interplay between business internationalisation, diversity management and SHRM ● SHRM perspectives on downsizing as a strategic option. Learning resources Text Millmore, M, Lewis, P, Saunders, M, Thornhill, A & Morrow, T 2007, Strategic human resource management. Selected readings Reading 3.1: Godard, J 2004, 'A critical assessment of high-performance paradigm', British Journal of Industrial Relations, vol. 42, no. 2, pp. 349–78. Reading 3.2: Holley, D 2009, 'Redundancy roller-coaster', Management Today, July, pp. 40–1. Reading 3.3: Management Today 2009, 'Innovation in a downturn', July, pp. 24–5. Reading 3.4: Buller, PF & McEvoy, GM 2012, 'Strategy, human resource management and performance: Sharpening line of sight,' Human Resource Management Review, vol. 22, pp.43-56.MGT8034 Module 3 – Aspects of strategic HRM page 2 © University of Southern Queensland 3.1 Organisational structure and design and SHRM An aspect that is central to the management of human resources but which is not often covered by HRM courses or books, relates to how the organisation is designed and structured overall. It is well acknowledged that there is a constant interplay between the structural configurations of an organisation and its strategic choices and options. According to Johnson and Scholes (2002, p. 420) the configuration of an organisation refers to the structures, processes, relationships and boundaries through which the organisation intends to (and indeed does) execute its strategies and achieve its mission, goals and objectives. Various options need to be considered in respect of how to organise and design the configuration of the organisation. Much of this revolves around the work of an organisation and the interplay between the people, the technology and the general business and value-adding processes of the organisation. Key considerations here relate to where (and by whom) which decisions are made, and how the work and value-adding processes will be distributed throughout the organisation and also therefore amongst employees. Johnson & Scholes (2002, p. 419) say it is quite likely that 'the most important resource of an organisation is its people. So the roles they play, how they play, how they interact through formal and informal processes and the relationships they build are crucial to the success of strategy.' This then clearly asks for choices about how to organise or structure the work, the workflow processes and the people that have to do all of the work. Davidson and Griffin (2003, p. 346) in this regard define organising as 'deciding how best to group organisational activities and resources … the structure of an organisation comprises all the arrangements put in place to divide up work … to ensure that efforts are coordinated …'. After all, the all the work activities that have to be carried out in order to achieve an organisation's objectives will have to be allocated to people. There are many ways in which these tasks and roles can be structured, and the relationships between these work roles and the people concerned organised. Structuring the work and the relationships and interactions between the technical systems and the people (the socio-technical systems), as well as between the people themselves (that is, structuring the flow of work), form important building blocks of organisations. Individual jobs cannot therefore be viewed in isolation. Neither can jobs be designed in isolation. Each employee is supposed to perform certain activities to achieve something (work outputs), which have certain consequences for the organisation as a whole. In order to be able to do the work, however, employees need certain things, which form the inputs into the work system (for example material, equipment, resources and specifications). One of the most fundamental inputs relates to the technical systems of the organisation – the technology used. The interaction between employees and technology thus forms an important consideration in the context of designing the work of organisations. The outputs of certain employees eventually form the inputs of other employees. The specific requirements of the next employee in terms of work to be done in the value-adding chain of workflows up to the point of delivering the products and services should thus form one of the main inputs into the process of designing work. In this sense the totality of work has its origin in the requirements of those who want to buy or use the organisation's outputs (products/services) – in other words, the customer. Through the work executed by each employee, value is supposed to be added at each point in the work-flow process. Work is thus structured into a complex system of interconnected value-adding steps from the point of the customer (who essentially initiates the need for work to be performed), to the point where the customer's needs are satisfied through appropriate, need-satisfying products/services. It is important to create the necessary fit at various levels – a fit between the technology and the job, between employee and the job or position, between the different jobs or positions, between different groups of jobs, between the organisation and the outside world, and so forth. The end result ought to be efficient and effective work operations that facilitate the achievement of the organisation's objectives through highMGT8034 Module 3 – Aspects of strategic HRM page 3 © University of Southern Queensland performing, satisfied employees, with due consideration for the impact of all of this on all relevant stakeholders, including the physical environment. There is a well-known notion in management literature that 'structure follows strategy'. Although the real world of organisational life is not always so neat that one can say this is always the case, and because there are so many complexities involved, it is perhaps safer to say that structural configurations and strategy of organisations are very closely intertwined. Structuring or designing the flow of work in organisations also involves choices about overall organisation design. Although these choices have major implications for the way the work of an organisation is organised, these choices are quite removed from the employees as such, since it revolves around the way the organisation as a whole is structured. However, these kinds of choices and decisions have implications for reporting lines and for the way that employment relationships, workflow processes, and relationships between the employees are structured or designed. There are certain basic structural variables that are relevant to organisational design. These include: ● Structural managerial configuration: This relates to the nature and form of the role structures within the organisation. It thus involves aspects such as the number of levels in the hierarchy, the horizontal and vertical span of control and so on. ● Formalisation: This has to do with the extent to which use is made of formally documented procedures, policy manuals, job descriptions and so on. ● Standardisation: This is linked to formalisation in a certain sense. It relates to the degree to which activities or work processes have to be executed in a uniform manner. Reliance on aspects like rules and regulations is therefore relevant. In the case of high standardisation there is little scope for discretion. ● Specialisation: This has to do with the extent to which specific functions and tasks are identified and earmarked for one specific individual or group to execute. ● Centralisation: This relates to the extent to which the power and authority to make decisions is delegated throughout the various levels of the organisational hierarchy. All of these variables hold very real implications for how the work of individual employees (as well as groups) will be organised or designed. So to do these variables make up the key building blocks of the different types of organisational designs that may be chosen from. Reading activity 3.1 You should now read chapter 5 of Millmore et al. (2007). Take note that three perspectives are considered to unravel the relationship between the design of organisational structure and the general strategic 'effectiveness' or 'performance' of the organisation. These are referred to in the textbook as the 'classical universal', the 'contingency' and the 'consistency' approaches to organisational design and structure. The chapter also reviews some key forms of organisational structure. The implications of each of these for the people who work within them are also assessed. The following types of organisational design are covered: simple; functional; divisionalised; matrix; project-based; network, cellular and virtual. Millmore et al. (2007) reckon that there seems to be a moveMGT8034 Module 3 – Aspects of strategic HRM page 4 © University of Southern Queensland from centralised and bureaucratic structures to more decentralised and more fluid design types. Millmore et al. (2007) also stress the importance of ensuring that human resource strategies are aligned with the chosen organisational structure or design type. In addition they point out that the choices in respect of organisational structure or design type can lead to some problematic relationships between things like managerial control, organisational efficiency and responsiveness to external conditions and market dynamics. We return to the issue of organisational structure in the last section of this module, as well as again in the next module when we make relevant connections between organisational structure and innovation. 3.2 Culture and SHRM Culture, according to Millmore et al. (2007), consists of shared attitudes, beliefs, values and behaviours that belong to and have been learned by a group and, because they are considered to be valid, have been internalized and are taken for granted. An understanding of culture and the interactions between different spheres of culture such as national and organisational, can assist in the selection and application of effective HRM interventions and the hierarchies in which they are placed. At the same time, SHRM interventions can influence the culture within organisations. In chapter 6 Millmore et al. go from general to specific – starting by reflecting on different meanings of culture and exploring different typologies of cultures from the angle of national levels. They then go on to examine frameworks for understanding 'organisational culture'. They consider the implications of different cultures for different aspects of SHRM – which they refer to as 'interventions'. They argue that an organisation's culture is an objective phenomenon which can be found in any organisation. As such they argue that an organisation's culture can be identified and it can be, at least theoretically, actively managed and manipulated to achieve alignment with an organisation's strategic direction. To this end they offer an analysis of a variety of ways in which this might be achieved and how this connects with SHRM and the contributions that are locked up herein. It should be noted that in the 'real world' this is indeed a very complex challenge that requires carefully planned and designed interventions. It is also important to keep in mind that any typologies such as those covered by Millmore et al. (2007), are generalisations and simplifications of complex and varied 'realities'. Reading activity 3.2 You should now read chapter 6 of Millmore et al. (2007). Engage in the selfcheck and reflect activities. We return to the issue of organisational culture in the next module – when we specifically make connections between organisational culture and innovation in organisations.MGT8034 Module 3 – Aspects of strategic HRM page 5 © University of Southern Queensland 3.3 Staffing the organisation: some strategic challenges related to sourcing work talent Making sure that the organisation has the people to do the required work generally starts of with processes of staffing the organisation. Some refer hereto as 'human resourcing'. These processes entail some planning and preparatory work as well as the active efforts to find and engage competent people to work for the organisation. Millmore et al. cover these in chapters 7 and 8. They refer to these processes as strategic human resource planning and 'strategic recruitment and selection'. Human resource planning (also referred to as HRP in short in the textbook) is sometimes used as the concept that reflects all the formal processes aimed at planning to ensure that an organisation's human resources capability is aligned with its strategic direction and objectives. Some limit it more to reflect forecasting the future demand for and supply of labour and drawing up 'HR plans' to bring about the appropriate match between demand and supply. In some sense it seems Millmore et al. (2007) conflate these somehow – and use the notion of SHRP. They do point out however, certain differences to what another author argues are 'human resource planning' and 'human resource forecasting'. This may be quite confusing – especially when the concept of forecasting is also used in relation to supply and demand (see table 7.2 on page 243 for example). Without going to much further into this here (we can do more of this on the electronic discussions platform for instance) – we'd just like to share a somehow different perspective in this regard first. In Swanepoel et al. (2008) a distinction is made between making strategic HRM choices and decisions (strategic planning for HRM) – and what they term 'workforce planning'. Swanepoel et al. (2008, p. 227) explain that 'it is necessary to decide, first of all, which work we regard as part of the core of the organisation's operations, and hence to be more likely to be performed by employees, and which we regard as being more peripheral that might rather be executed by other means, like subcontracting'. They (Swanepoel et al. 2008, pp. 227–8) continue as follows: We thus need to plan what kinds of positions we will need, what types and numbers of people with what kinds of competencies will be required to ensure the successful operation of the organisation, and which of these will or will not become part of our organisation's staff establishment. When we consider these types of issues we have basically already embarked on the management process known as workforce planning. Some refer to this as human resource planning. We prefer the concept workforce planning because in this way we can differentiate it from strategic planning and decisions pertaining to HRM strategy … In practice all of these preparatory decisions and issues are intertwined. For example, as we have to engage in making strategic decisions about how we would like to manage our human resources generically speaking, we have to consider design issues such as core versus non-core work. As mentioned before, we might have a different approach to the core employees compared to non-core workers. When it comes to planning the workforce requirements, naturally the same issues are relevant: what constitutes our core workforce of employees? … We regard workforce planning as a systematic, yet dynamic process of estimating the future demand for and supply of employees to execute the organisation's work in ways that will best support its strategic direction, and deciding how to align and match them. We thus work from the assumption here, purely for conceptual purposes, that we have already decided about what the core workforce of the organisation will be – our core work and staff/employees as well as the support work and groups of employees whoMGT8034 Module 3 – Aspects of strategic HRM page 6 © University of Southern Queensland will be engaged for that purpose. The focus in workforce planning is on the employees we might need. Practically speaking, things are not so clear-cut and neatly boxed. As we plan what work needs to be covered by our staff, it might well turn out that we decide some of the work demand or needs may be more temporary or less strategically valuable – and hence we might shift to consider alternative ways of trying to match the demand and supply. The starting point is to purposefully consider what work is required to be done in order to move the organisation in the strategic direction decided upon … Workforce planning thus uses information and knowledge about the work needs of the organisation as translated from the business needs. Millmore et al. (2007), as you'll find – follow a different approach and argue that HRP, if done strategically, becomes the vital link between organisation strategies and the HR strategies of the organisation. As such it is then argued that it is basically the bridging mechanism fulfilling the following three vital roles: aligning HR plans to organisational strategies to further their achievement; uncovering HR issues that can threaten the viability of organisational strategies and thereby lead to their reformulation; and acting in a reciprocal relationship with organisational strategies such that HR issues become a central input into the strategy formation process. Reading activity 3.3 You should now read chapter 7 of Millmore et al. (2007). Engage in the selfcheck and reflect questions – and apply some critical thinking. Take note of the numerous difficulties that are mentioned regarding the practise of HRP that may thwart its potential to serve as the link between organisational strategy and SHRM practice. Does your organisation engage in practising HRP? How effective is HRP practice in your organisation if present? Millmore et al. (2007) points to a paradox where the more the complexities of organisational life warrant the establishment of HRP as the vital link, the more these complexities seem to be likely to cause HRP to be cast aside to become the missing/weakest link. They also share some avenues for confronting operational difficulties and to make HRP the pivotal bridging mechanism between organisational strategy and SHRM. Can you identify and discuss these? For instance: raising the profile of HR issues generally and the status and credibility of HR practitioners particularly. If, as we say HRM is not the domain of the HR specialists – but ever manager's work – what are your views in this regard? Millmore et al. (2007) draw on the work of Schuler and Jackson (1987) to show how HRP can be the bridge that links various competitive strategies with certain HRM practices. It is argued that to identify and develop HR practices relevant to different organisational strategies requires a deliberate planning intervention, that is, HRP. They also point out though that such a 'one-way, top-down' strategic relationship between corporate and HRM strategies is only one of a number of different types of strategic fit. Planning suggests a degree of certainty that is largely unrealistic in today's volatile business climate. Therefore to be useful HRP processes have to be shaped so that they can accommodate planned and unplanned change over different time horizons.MGT8034 Module 3 – Aspects of strategic HRM page 7 © University of Southern Queensland Apart from the planning or preparatory side of 'human resourcing' – there is the issue of actually finding the employees and getting them employed. In chapter 8 Millmore et al. (2007) cover this topic. They use a model of 'strategic recruitment and selection' that is built around three key aspects: strategic integration; a long-term perspective; and the use of HRP as a bridging mechanism between strategy and HR practice. They argue that despite uncertainties surrounding strategy implementation and the business environment as it unfolds over time, recruitment and selection practice can be shaped to support long-term changes in strategic direction. They also point out that strategic recruitment and selection has potentially to be aligned with multiple interpretations of strategy if it is to satisfy its strategic credentials. It is also pinpointed that despite a good rationale to the contrary, organisational approaches to recruitment and selection practice appear to be dominated by traditional, non-strategic approaches, hence making it arguably another aspect of HRM where the rhetoric runs ahead of what we find in the real world. It is back to doing some reading again now. Reading activity 3.4 You should now read chapter 8 of Millmore et al. (2007). Again, please consider engaging in the self-check and reflect questions. Also – do not neglect applying some critical thinking. 3.4 Managing and rewarding performance, and strategic human resource development Once people are employed – they have to do the work they have been employed for, and the aim would be to get them to perform as well as possible in the work environment. Performance management can be regarded as a non-time specific ongoing process that involves the planning, managing, reviewing, rewarding and development of individual and group performance (Fitzpatrick, Fujimoto, Härtel and Strybosch 2007, p. 342). According to your prescribed book, the concept of 'performance management' is an 'umbrella term' that captures the wide range of activities, practices and processes, including performance appraisal – all aimed at enhancing organisational performance. From module 2 you know that 'performance' and 'organisational performance' are complex and multidimensional issues. Ideally performance management should flow down from the organisation's strategy through horizontal and vertical integration as part of a concerted effort to generate change through the organisation's 'high performance' HR strategy – as explained in the prescribed book. Millmore et al. (2007) say that among the reasons for the growth in importance of performance management, are the desire to enhance organisational effectiveness (we can efficiency and sustainability as well). Another reason offered is the dissatisfaction with the traditional narrow focus on 'performance appraisal'. It is time to do some reading now.MGT8034 Module 3 – Aspects of strategic HRM page 8 © University of Southern Queensland Reading activity 3.5 You should now read chapter 9 of Millmore et al. (2007). Again, please consider engaging in the self-check and reflect questions. Take note that they argue that some of the major conceptual flaws in performance management thinking are the potential preoccupation with management control, the assumed compliance of employees and the dangers of prescribing a particular model of performance management without paying due regard to the organisation's context. As we always encourage – do not neglect applying some critical thinking. To help with this you should now read selected reading 3.1, 'A critical assessment of the high-performance paradigm', by John Godard (2004), and published in the highly regarded British Journal of Industrial Relations. Also pay careful attention to the performance management systems model covered in the book, which includes inputs such as external and internal contexts and employee skills, processes including setting objectives and 360-degree appraisal; HR outputs such as performance improvement plans and pay awards. The latter is very important and Millmore et al. (2007) devote a separate chapter to 'strategic reward management'. We now turn to the issue of pay reward about which you can learn in greater detail. Reading activity 3.6 You should now read chapter 11 in Millmore et al. (2007). Engage in the selfcheck and reflect activities. Part and parcel of the challenge to manage and enhance the work performance of staff – is to develop their potential and capabilities. Millmore et al. (2007) say that there is a lot of literature available on the topic of SHRD (strategic human resource development). They argue that there is a particular emphasis on strategic integration, the centrality of learning and a learning culture to SHRD and multi-stakeholder responsibilities and involvement. Take note, when you read the relevant chapter in the prescribed textbook, that the critical role to be played by line managers in facilitating learning and development, is stressed. Reading activity 3.7 You should now read chapter 12 in Millmore et al. (2007). Please engage in the self-check and reflect activities. You will note that an important feature of the chapter is the authors' attention to the traditional systematic cycle of HRD as well its strategic potential. They argue that this strategic potential is often overlooked in the SHRD literature and thy thus attempt to show that irrespective of how HRD is portrayed – it is possible to give it a strategic focus. You'll pick up that throughout chapter 10, the authors try to explore various degrees of 'strategic focus' (or 'integration') in respect of HRD efforts. In this regard you will probably find the use of their conceptual model of strategic maturity that develop along the lines of a continuum, quite useful. We now turn to focus on a few other aspects pertaining to SHRM.MGT8034 Module 3 – Aspects of strategic HRM page 9 © University of Southern Queensland 3.5 Business internationalisation and SHRM, and diversity management The pace of globalisation has picked up considerably over the last few decades in particular. In this regard the following explanation offered by Cooke (2007, pp. 489–90) may serve as a potentially useful introduction to 'set the scene' for this theme: The growth and spread of multinational companies around the world over the last two to three decades has been nothing short of extraordinary. Indeed, since 1980 there has been a nearly twelve-fold increase in foreign direct investment (FDI) and a greater than eight fold increase in the number of multinational companies (MNCs). As of 2004 there were over 61,000 MNCs with ownership in over 900,000 foreign affiliated operations worldwide. These foreign affiliates alone employed more than 54 million employers, managed over $US 31 trillion in assets, generated over $US 17 trillion in sales, and accounted for roughly 33 percent of worldwide exports and 10 percent of gross domestic product … The ever expanding reach of MNCs in an increasingly competitive and uncertain global market place puts the multinational enterprise at the center of a widening public debate and scrutiny regarding the impact of MNCs on the global economy, on the well-being of workers and communities across the globe, and on the earth's natural resources and environment. This broader and heated debate notwithstanding, the continual expansion of multi-national operations undoubtedly raises a host of questions about the critical role of managing human resources across borders. … Although the overall objectives of formulating and implementing HR strategies as described throughout this volume are the same for national and multinational companies, global HR strategies must take into account factors germane to direct investments made abroad and the management of cross-border operations. At question herein, therefore, is: What factors or considerations are unique to companies operating across borders and what are the implications of these factors in regard to the successful development and deployment of global HR strategies? The existing literature in regard to global HR strategies can be characterized as being in an early stage of development. (Source: Cooke, WN 2007, 'Multinational companies and global human resource strategy', chapter 24 in P Boxall, J Purcell & P Wright (eds), The Oxford handbook of human resource management, Oxford University Press, UK, pp. 489–91.) Even though Cooke (2007) is quite right about the early stage of development about this theme – the prescribed book contains a very useful chapter on international HRM. Reading activity 3.8 You should now read chapter 3 in Millmore et al. (2007). Please engage in the self-check and reflect activities.MGT8034 Module 3 – Aspects of strategic HRM page 10 © University of Southern Queensland The authors of the textbook start off with a general introduction to the internationalisation of business – why organisations engage herein and the main methods of doing so. The main focus of the chapter, as you'll learn – is what they term 'SIHRM'. A conceptual model is used to examine what strategic international human resource management is about. The model used reflects the classic MNC components and factors relevant to the MNC's external and internal operating environments influence the SIHRM issues, functions and policies and practices, which in turn affect the concerns and goals of the MNC. You will note that the chapter concludes with a section that revolves around culture – as they emphasise that the more organisations do business internationally, the more important becomes the issue of cultural diversity. Millmore et al. (2007) stress that national cultural differences are indeed an important aspect of SIHRM and that these have been researched by a number of scholars. You'll learn that there are various strategies for managing cultural differences, including ignoring these, trying to minimise these, and actually embracing and capitalising on them. This is where diversity management becomes important. The issue of diversity management is so important nowadays (even beyond the context of MNCs of course) – that we would now like to focus in a bit more detail on this theme. You are now thus to read another chapter in Millmore et al. (2007). Reading activity 3.9 You should now read chapter 13 in Millmore et al. (2007). Please engage in the self-check and reflect activities. You will note that the textbook clearly acknowledges that diversity management is also approached a legislative and compliance point of view. This is also referred to as the equal opportunities approach, which has as focus the 'equality of status, opportunities and rights'. It is doubtful whether we can really term such an approach as 'diversity management' from our perspective. What are your views in this regard? Why not engage in some discussions about this on the electronic discussions platform? The 'real' diversity management, we believe, is the one that revolves around an explicit holistic strategy of valuing the wide range of differences brought into any organisation, including things like age, gender, social background, national culture and ethnicity, and disability. This, as argued also by Millmore et al. (2007), is more aligned with a strategic approach and hence with SHRM – because it is driven by organisational needs. In the book it is said that the business case claimed for following such a diversity management approach includes aspects like better reputation and public image for the organisation, a more satisfying work environment for all staff, better employee relations, enhanced work satisfaction related positive attitudes. These things, it is argued, should improve productivity and organisational competitiveness. Millmore et al. thus put forward the argument that organisations will only survive and prosper in an increasingly competitive and dynamic global environment, if they respond to the heterogeneity of their markets – including their labour markets. Note however, that they acknowledge that there is limited empirical evidence to support these arguments in countries like the UK or the USA. 'What about other countries like Australia, Singapore and even South Africa?' – you may rightly wonder. Feel free to engage in some healthy debate about these on the electronic discussions platform. Also – please take note that there seems to be a very strong argument that creativity and innovation can be enhanced through tapping constructively into diversity.MGT8034 Module 3 – Aspects of strategic HRM page 11 © University of Southern Queensland To conclude this module we now turn to a completely different, and in a sense a much less 'positive' aspect related to strategy and HRM – namely that of 'downsizing' or 'workforce reduction'. 3.6 Downsizing as strategic option: SHRM perspectives You will recall that in the first module you were introduced to various strategic options that are open to organisations to choose from. There were the generic strategy options of Porter, the three options of Miles and Snow, as well as the three that were used by Schuler and Jackson (see table 2.3 again on page 55 of Millmore et al.). Cost-focused strategies are thus clear options (like cost reduction and 'low-cost' strategies). We also mentioned the grand strategy options of Pearce and Robinson in module 1. We quoted from Swanepoel et al. (2008, p. 140) who summarised the following two options in the cost-focused category, and we repeat that here: 'Divestiture revolves around selling off parts of the organisation while turnaround strategies typically entail scaling down for a period (cost and/or asset reduction typically) in order to recover and rebuild.' Downsizing is thus a strategic option that becomes particularly relevant in any of these costdriven strategies. No doubt most of us would have become all too aware of the implementation of these kinds of strategies over the past few years (most notably through 2008 and 2009) – due to the 'global financial crisis'. It is thus perhaps opportune to now read a bit more about some challenges pertaining to downsizing as strategic option and the various HRM implications. Reading activity 3.10 You should now read chapter 14 in Millmore et al. (2007). Please engage in the self-check and reflect activities. You'll find that Millmore et al. (2007) regard downsizing is an organisational strategy to reduce the size of an organisation's workforce. They argue that the use of this strategy is likely to generate a range of reactions from those who remain in an organisation – which may lead to negative outcomes for the organisation. Naturally – this strategy also has potentially disastrous consequences for those unfortunate people who will then be losing their work! Take note of the three organisational strategies that are identified to achieve downsizing, namely workforce reduction, organisation redesign, and the 'systemic change'. They also make a distinction between the use of proactive and reactive approaches to downsizing, arguing that the reactive approach has been found to impair, rather than enhance, organisational performance. Millmore et al. (2007) make it clear that in reality the process of downsizing is very complex and challenging – and that the reactions of people thereto can often undermine the strategic objectives for downsizing. They thus explore such reactions and their potential consequences for organisations that are considering this as an option. They furthermore argue that the successful use of downsizing requires the implementation of and integration with other human resource strategies discussed in their book. According to them, through doing this – the possible negative reactions to downsizing can be limited. Take note of the emphasis placed on human aspects of downsizing to try and minimize any possible negative spin-offs.MGT8034 Module 3 – Aspects of strategic HRM page 12 © University of Southern Queensland No doubt – there is scope for injecting some creative ideas pertaining to the whole issue of dealing with working people under conditions of economic or financial strain – and for coming up with some innovative approaches and solutions. During times of economic downturn and turmoil there may also be scope for some innovation. It may be worthwhile to engage in some discussions about this on the electronic discussions platform. Let's engage in some final reading as part of this module. Reading activity 3.11 You should now read selected reading 3.1 ('Redundancy roller-coaster') by Holley and selected reading 3.3, 'Innovation in a downturn'. These are not 'heavy academic' articles – but they should do well in rounding off this module. Selected reading 3.4 by Buller and McEvoy (2012) is highly regarded as a way to align the various aspect of strategic HRM we have discussed above. This article can be used as summary of the key issues. For instance, the authors discuss the line of sight as the alignment of organizational capabilities and culture, group competencies and norms, and individual KSAs, motivation and with the organization' strategy. Conclusion In this module we have considered various perspectives, issues and challenges related to strategic human resource management. Some of these more structural perspectives have been important to set in place in this module, as they form the building blocks upon which rest some of the specific innovation perspectives to be presented in module 4. It is essentially a review of some of the mainstream roles and functions of organisational form and structure, the alignment of job design and HR strategy with organisational purposes and the adopted stances by managers and organisational systems of employment relationships that form key building blocks for organising and realising innovative processes. In the next module the focus shifts more specifically to challenges related to building innovation in organisations.MGT8034 Module 3 – Aspects of strategic HRM page 13 © University of Southern Queensland Reference list Cooke, WN 2007, 'Multinational companies and global human resource strategy', chapter 24 in P Boxall, J Purcell & P Wright (eds), The Oxford handbook of human resource management, Oxford University Press, UK, pp. 489–91. Davidson, P & Griffin, RW 2003, Management: an Australasian perspective, 2nd edn, Wiley, Milton. Johnson, G & Scholes, K 2002, Exploring corporate strategy: text and cases, 6th edn, Prentice-Hall, New York. Miles, RE & Snow, CC 1984, 'Designing strategic human resources systems', Organizational Dynamics, vol. 13, no. 1, pp. 36–52. Milkovich, GT & Boudreau, JW 1994, Human resource management, 7th edn, Irwin, Burr Ridge. Schuler, R & Jackson, S 1987, 'Linking competitive strategies with human resource management practices', Academy of Management Executive, vol. 1, no. 3, pp. 207–19. Swanepoel, BJ, Erasmus, BJ, & Schenk, H 2008, South African human resource management: theory & practice, 4th edn, Juta & Co., Landsdowne.