Discrimination means unequal treatment.”Employment discrimination is a form of discrimination based on race, gender, religion, national origin, physical or mental disability, and by age of employers.

Title VII of The Civil Rights Act of 1964 says that no person employed or seeking employment by a business with more than 15 employees may be discriminated against due to his or her race, colour, religion, sex or national origin.

There are 4 major types of employment discrimination namely:

1. Race

2. Sex

3. Age

4. Disability

Discrimination by Race

From Title VII of The Civil Rights Act, it is unlawful to discriminate against any employee or applicant for employment because of his/her race or color in regard to hiring, termination, promotion, compensation, job training, or any other term, condition, or privilege of employment. Title VII also deals with harrassment on the basis of race and/or color. Harrassment includes the use of ethnic slurs, racial “jokes”, offensive or derogatory comments, or other verbal or physical conduct. Title VII is also violated where minority employees are segregated by physically isolating them from other employees or from customer contacts.

 Sexual Discrimination

Sex or gender discrimination is treating individuals differently in their employment specifically because an individual is a woman or a man. some examples of potentially unlawful sex/gender discrimination that women, for example, may face:

1. Hiring/Firing/Promotions

2. Pay

3. Job Classification

Discrimination by reason of age

The Age Discrimination in Employment Act of 1967 (also known as the “ADEA”) provides that no person shall be discriminated against because of his or her age. If an employer terminates an individual who is older than 40 years of age and there appears to be no valid reason for the termination other than the employee’s age, the former employee may have a valid complaint against the employer for age discrimination under this law. The ADEA’s protections apply to both employees and job applicants. Under the ADEA, it is unlawful to discriminate against a person because of his/her age with respect to any term, condition, or privilege of employment — including, but not limited to, hiring, firing, promotion, layoff, compensation, benefits, job assignments, and training.

Discrimination by reason of Disability

The ADA makes it unlawful for an employer with 15 or more employees to discriminate in all employment practices such as recruitment, hiring, promotion, training, lay-off, pay, firing, job assignments, leave, and/or benefits because of an employee’s disability.

The ADA defines a disability as:

1.A physical or mental impairment that substantially limits one or more of your major life activities; and

2. There is a record of such impairment; or

3. You are regarded as having such an impairment.

These are some of the common workplace discrimination faced by employees in organisations. I’ll be talking about measures to curb such discrimination in workplace in the next article.

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As the year 2014 just went underway, the industry came to a surprise and saw many upcoming changing trends in HR the last one year. Companies witnessed the year as the big year of innovations focussed primarily on improved productivity as well as accomplishing more with less. Not to mention, technology definitely was the driving force to achieving competitive advantage, finding skilled people was the difference in the year.

Among many trends in the year, a few to mention are:

1. MORE COACHING AND DEVELOPMENT: “The 100 best companies offer nearly double the hours of on-the-job training to employees as companies not on the list”- China Gorman, CEO of Great Place to Work. Companies who wanted to be seen as “company of employee” have started investing time and money in career development programs.

2. BETTER TECHNOLOGY FOR RECRUITMENT AND SCREENING: Bersin research tells that only 14% of the companies have taken time to use talent analytics software. Advanced software such as recruitment talent analytics and big data tools have led to top rate employees as well as unique candidates who can fill specialised roles.

3. FOCUS ON FINANCIAL WELLNESS: According to Aon Hewitt, more companies have started expanding their focus on the financial well-being of employees by them with the tools and services to help them make smarter financial decisions.

4. PREPARING FOR HEALTH REFORM: In a recent SHRM survey, 79% of HR professionals believe that the cost of health care will have a major impact on the US workplace in the next 5 years.

5. MOVING PAST THE EMPLOYEE ENGAGEMENT SURVEY: Organisations will now have to monitor engagement through continuous stream of feedback through exit and stay interviews, open blogs and communication activities.

The year has not been little than surprise and full of changes in the department, the organisation and the industry at large. These changes are definitely the beginning of evolution in the HR industry and a satisfied platform for the employees.

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Increasingly, it is being recognised that competitive advantage can be obtained with high quality workforce that enables the organisation to compete on the basis of market responsiveness, product and service quality, differentiated products, and technological innovation. Thus in the present era of liberalisation and globalisation, a business enterprise must attain human resource based competitive edge over its competitors to ensure its survival and growth. A dynamic manager tries to achieve competitive advantage for the organisation which maybe in the form of low cost leadership in the industry or being unique in the industry along dimensions that are widely valued by the customers in general and society in large.

Of late, HR Department has undergone a drastic change and now people are talking about HR being a strategic partner providing sustainable competitive advantage to the organizations. The VRIO Framework (Barney, 1995) is one of the most significant approaches that suggests ways to achieve sustainable competitive advantage through HR. The term VRIO including Value, Rareness, Imitability and Organisation. 

VALUE: HR executives must address a primary question “How can HR aid in either decreasing costs or increasing revenues?”  HR can help a firm achieve sustainable competitive advantage by creating value. HR practices should be related to employee attitudes which would be consequently related to customer satisfaction. Example: FedEx, which are the market leaders in the courier business, believe people are the primary link in the value chain, and thus, value is created by focusing on employees first.

RARENESS: Value alone is not sufficient for attaining competitive edge over the other firms in the market. HR executives must examine the ‘rare fact’ where the product stands different from others. Example: Nordstrom is one of the most reputed brands in the retail sector. The recruiting process, compensation practices and culture at Nordstrom’s have helped the organization to maintain the highest sales per square foot of any retailer in the nation.

IMITABILITY:The HR executives must attempt to develop and nurture characteristics of the firm’s human resources that cannot easily be imitated by competitors. By restricting and developing unique culture, executives can help firms in gaining competitive advantage. Example: Even after purchasing the safety training programs,DuPont’s competitors are simply unable to match DuPont’s safety record. DuPont’s superior safety performance stems at least partly from its unique history that competitors find impossible to imitate. Thus, DuPont has core competence in chemical technology.

ORGANIZATION: Organization requires developing the systems and practices that allow human resources characteristics to bear the fruit of their potential advantages, generate revenues sufficient to meet the firm’s goal as well as achieve individual satisfaction. Example: Both General Motors and Ford recruit assembly line workers from the same basic labor market. But, Ford has been more successful at developing a cooperative, team-based culture than General Motors. Clearly the HR function, through either directly controlling or strongly influencing the characteristics of human resources in organizations plays an important role in developing and maintaining a firm’s competitive advantage.

No doubt, HR function can help in achieving sustainable development and growth to the firm in the long run.

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The four P’s of marketing- product, place, price and promotion,  certainly present many compelling ways to differentiate a firm’s product or services from those of one’s competitors. However, as one plans to get the business off the ground, one needs to consider more than just marketing strategies to achieve sustainable competitive advantage, no matter which market the firm is in. Thus one of the most important aspects of the business is what is known as HR strategy and human capital- you, and your employee.

According to Charles Greer, “In a growing number of organisations, human resources are viewed as a source pf competitive advantage. There is greater recognition that distinctive competencies are obtained through highly developed employee skills, distinctive organisational culture, management processes and systems.”

Increasingly, it is being recognised that competitive advantage can be obtained with high quality workforce that enables the organisation to compete on the basis of market responsiveness, product and service quality, differentiated products, and technological innovation. Thus in the present era of liberalisation and globalisation, a business enterprise must attain human resource based competitive advantage over its competitors to ensure its survival and growth.A dynamic manager tries to achieve competitive advantage for the organisation which maybe in the form of low cost leadership in the industry or being unique in the industry along dimensions that are widely valued by the customers in general and society in large.

What’s the HR/competitive advantage link?

As environments become increasingly dynamic, is innovation more or less important? More, obviously. At least adaptation is essential, innovation even better. But we know that the most potent sources of innovation are often ideas that emerge from within the company – usually in connection with an insight that someone has in working with customers. So a strategically minded HR department can craft jobs, create networks among people, and provide the training that helps every person in the organization become part of its innovation engine.

As environments become increasingly dynamic, is it more or less important that senior leaders are flexible, externally focused and well prepared? Well, obviously, more important.But who is overseeing the long-run development of these key people? Who makes sure that over the course of a career they are exposed to the right experiences, get the right development opportunities through formal and informal executive education and mentoring, and are considered for the next job when it comes up? Often, these critical tasks aren’t actually done by anybody, or they are left to the vagaries of individual managers to handle the careers of the people reporting to them. A strategic HR focus, in contrast, really does look at the careers of highly talented people in a holistic way, and sees that depth, adaptiveness and engagement are being built into the way careers unfold.

Because of the critical role of human resources in enabling the organisation to effectively deal with the external environmental challenges, the human resource manager has become a strategic partner in the formulation of organisation’s strategies. He creates a competitive edge for the organisation by giving strategic focus to human resource planning, employment, training, appraising and rewarding of personnel.

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Sharing knowledge is a vital component in the growth and advancement of our society in a sustainable and responsible way.With the advent of globalisation, organisations- big or small have ceased to be local, they have become global! This has increased the workforce diversity and cultural sensitivities have emerged like never before. All this led to the development of Global Human Resource Management. Through Open Access, various leading institutions are tearing down the barriers to access and use research literature. There is increased interdependence between organisations in various areas and functions.
The preliminary function of Global HRM is that organisation carries a local appeal in the host country despite maintaining an international feel. To exemplify, any multinational/international company would not like to be called as local, however the same wants a domestic touch in the host country and there lies a challenge.
Due to internationalisation of business some countries have experienced very large increase in their labour force- nearly 8 million new entrants a year in China since the mid 1990s and 7 million in India. Moreover, job agendas at the country level are connected by the migration of people and migration of jobs. Policies for jobs in one country can thus have spillovers on other countries both positive and negative.

The various underlying objectives of Global HRM are as follows:
1. Create a local appeal without compromising upon the global identity.
2. Generating awareness of cross cultural sensitivities among managers globally and hiring of staff across geographic boundaries.
3. Training upon cultures and sensitivities of the host country.

The strategic role of Human Resource Management in such a scenario is to ensure that HRM policies are in tandem with and in support of the firm’s strategy, structure and controls. Specifically, when we talk of structure and control the following become worth mentioning in context of Global HRM:
1. Decision making
2. Co-ordination
3. Integrated mechanisms.

Global HRM is therefore a very challenging front in HRM. If one is able to strike the right chord in designing structures and controls, the job is half done.

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It’s about having the right people, with the right abilities, in the right place, at the right time.

Since the 1980s the nature of Personnel Management is undergoing change and personal function is shifting the locus of its focus. Amongst the personal specialists, the term ‘Personal Management’ is being substituted by that of ‘Human Resource Management’.

Originally conceived to handle personal hiring and payments, the function now aligns closely with a company’s strategic plan. Th HR Management history is fascinating. The wars usually change the path of Human Resource in organisations and society.

1. Labour Relations

Beginning in the 1900s during the Industrial Revolution, a company’s managers tended to treat people as interchangeable. When disputes arose, the mediators intervened to solve problems. Today, this function involves negotiations, administrating collective- bargaining agreements with unuons as well as providing training.

2. Industrial Relations

The rapid development of new industrial approach to work changed the world dramatically. The quick and cheap production became a priority for many industries. The factories hired thousands of workers, who worked up to 16 hours a day. Soon entrepreneurs realised that satisfied employees are more effective and can produce more than depressed employees. Thus many companies started to work upon improving the working conditions of the employees. Also some basic human rights and work safety legislation were introduced by the government.

3. Personnel Administration

After World War II, in the 1940s workers’ right and formal rights emerged. During the 1960s, this function evolved to ensure legal compliance. It also included recruitment, hiring, training and assessing workers. Failure to comply with regulations put companies at risk. Personnel administrative tasks focused on completing paperwork to prevent this.

4.  Human Resource

The real evolution began in 70s of the 20th century. The technology and globalisation have changed the rules of the game. It included the application of new theories related to change management, motivation and team building. Also many companies experienced mergers and acquisitions. Additionally, the use of computers led to the rise of automated procedures and Web-based HR systems.

Currently, HR department focuses less on transactional operations of personnel administration and pays more attention to recruiting the right employees, training and developing the workforce managing performance.

The future of HR is bright. The globalisation cannot be stopped because countries collaborate. New technologies will bring other revolutions to offices. It will be about new networking methods and how to make employees know each other.

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People differ in their abilities ans aptitudes. These differences are natural to a great extent and cannot be eliminated even by giving the same basic education and training to them. Therefore it is necessary for management to know these differences so that the employees having better abilities may be awarded and wrong placement of employees may be rectified. Similarly, the the individual employee may also like to know the level of his performance in comparison to his colleagues so that he may improve upon it. Thus, there is a great need to have suitable performance appraisal system to measure the relative merit of each employee.

According to Hayel,”Performance Appraisal is the process of evaluating the performance and qualifications of the employees in terms of the requirement of the job for which he is employed, for purposes of administration including placement, selection for promotions, providing financial rewards and other actions which require differential treatment among the members of a group as distinguished from actions affecting all members equally.”

A recent survey of more than 2000 full-time employees by Adecco Staffing of North America found that half of the workers say managers take performance reviews seriously, and even fewer say they receive constructive feedback.

Performance Appraisal from employees point of view– ‘A performance appraisal is meant to help employees realise their strengths and shortcomings and receive a compensation accordingly.’

A Brazilian firm, Semco has 3000 employees, a turnover of over $200 million and has been growing at 20-30% every year. Semco does have managers but employees have more freedom than elsewhere. They can choose their hours of work, decide their salaries and pick up their bosses. Managers are anonymously evaluated every six months by their subordinates. Semco has practiced this philosophy for 25 years now.

Objectives of performance appraisal:

1. Providing feedback

2. Facilitates promotion decisions

3. Facilitating layoff or downsizing decisions: If promotions are what everybody wants, layoffs are what everybody wishes to avoid. But when economic realities force an organisation to downsize, performance appraisal makes sure that the most talented individuals are retained and to identify poor performers who affect the productivity of the organisation.

4. Encouraging performance improvement

5. Motivating superior performance

6. Setting and measuring goals

7. Counselling poor performance

8. Determining compensation changes

9. Supporting manpower planning

10. Determining Individual training and development needs

According to global paints and coatings major, Akzo Nobel India, appraisals are a continous process. “The HR team conducts workshops with managers before the mid year and year end cycle based on the performance and development dialogues process. The mid year review is not about ratings and but I geared at reviewing and providing guidance to the employees. The year end process, on the other hand, focuses more on self assessment and involves feedback by both primary and secondary reviewer,” said Sangeeta Pandey, director, HR, Akzo Nobel India.

Performance Appraisal thus is a systematic and objective way of judging the relative worth or ability of an employee in performing his task and is thus important for an organisation.

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HRM stands for human resource management and Gary Dessler has defined it as, “Human Resource Management  is the process of acquiring, training, appraising, and compensating employees, and attending to their labour relations, health, safety and fairness concerns.”

As human resource management usually applies to big companies and organisations, it has sub categories among which is HRD which stands for human resource development. This component of HRM focuses on “nurturing employees’ skills.”

The difference between the two can be understood as follows:

1. HRD focuses on the training and the skill set of the individual, as well as optimising work performance. HRM on the other hand focuses on the main functions of management namely recruitment, selection, remediation to employees who need discipline and retooling to continue their employment.

2. HRD is more proactive, it copes with the changing needs of the people as well as anticipate those needs; whereas HRM is a function coping with changes in the organisation as a whole.

3. HRD is a subsystem of a large system, more organisational oriented and HRM is a function more independent with separate roles to play.

4. HRD is concerned only with people, HRM is developing the whole organisation.

5. HRM is a continous function; HRD is a rountine and administrative function.

6. HRD is the involvement of the entire work force from top to bottom and HRM is basically the responsibility of the HR department.

Although there are differences between the two, one cannot function without the help of the other.

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The term Human Resource Development came into being when in 1970, Leonard Nadler published his book “Developing Human Resource” in which he coined the ‘Human Resource Development'(HRD).

The American Society for Training and Development defines HRD as, “human resource development is the process of increasing the capacity of the human resource through development. It is thus the process of adding value to individuals, teams or an organisation as a human system”. In simpler words, Human Resource Development is the part of human resource management that deals specifically with the training and development of the employees in the organisation. It includes training and development of a person soon after the person is recruited by the organisation, and new skills, job methods, the business working model, which provides the person the opportunity to learn and grow are taught, and thus complying with own goals as well as that of the organisation. The people become human resource only when they are competent to perform organisational activities. 

Nature of HRD

1. It is a continous process and thus the value of human resource increases over time.

2. It is concerned with behavioral knowledge. The compentencies are developed through HRD programme.

3. It is a well integrated system.

4. It focuses on the all round development of human resources.

Importance of Human Resource Development:

1. HRD develops competent HR: HRD develops the skills and knowledge of the individual, hence it provides competent and efficient HR as per the job requirements, hence increases the human capital value.

2. HRD creates opportunities for career development and improves employee commitment: The development of the human skill, through constant training, increases the knowledge and opportunities for personnel to try hand at several other big opportunities. It also gives them an incentive of performance improvement. They feel committed towards the work and the organisation and are inspired to perform better.

3. Change Management: It facilitates planning, and management of change in an organisation. And also develops organisational health, culture and environment which leads to change management.

4. Training and development: Human resource conducts needs assessments for the organisation’s current workforce to determine the type of skills training and employee development necessary for improving skills and qualifications.

5. Overall company improvement: Human resource develops performance management systems. With a well developed human resource staff, the company’s performance and corporate image increases. Businesses want to be known as the “employer of choice.” Employers of choice are the companies that receieve recognition for the way they treat employees; they are companies for whom people want to work.

Hence HRD helps to develops the skills and competencies according to the changing business environment and is thus of immence importance to the firm.

I’ll be talking about major differences about human resource management and human resource development as well as talk a little about personnel development in the next upcoming articles.

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Chief HR Officers of leading organisations are now a days aiming to leverage Human Resource Outsourcing(HRO) as a sustainable and competitive method to manage costs and allow the company to focus on major improvements and core competing activities rather than managing the transactional activities in the HR operations.

The Society of Human Resources Management(SHRM) conducted a survey of hundreds of companies about the outsourcing habits and the results are as follows:

1. 26% of companies outsource to save money: outsourcing helps reduce the cost of maintaining non-revenue generating back-office expenses. Outsourcing costs are variable and can be reduced accordingly.

2. 23% of the companies outsource to focus on strategy: outsourcing helps a company to focus on major tasks and formulating strategies and improving a firm’s competitive strengths. Outsourcing helps to focus more on planning.

3. 22% companies outsource to improve compliance- it is increasingly risky not to meet the law requirements and pay attention to various employment and labour laws. Also better audit practices can be complied with.

4. 18% of companies outsource to improve accuracy and efficiency: helps employees and managers spend less time doing paper work and more time is thus dedicated to improve the efficiency and effectiveness of the workforce.

5. 18% companies outsource due to a lack of experience in-house

6. 18% companies outsource to take advantage of technological advances: outsourcing can offer great solutions without a significant investment. It helps streamline important functions such as payroll, benefit administration and compliance management.

Among top 10 Human Resource Outsourcing companies includes:

1. ADP

2. Evernext HR

3. Insperity

4. Jumpstart

5. MMC HR

6. Operationsinc

7. Oasis Outsourcing

8. ProHR

9. ThinkHR

10. Trinet

Human resources outsourcing makes sense especially when the size of the company is large and departmentalised into various business levels, whwre compliance and legal liabilities can be a huge risk and also paying attention to employees and trade unions become mandatory. No doubt Human Resource Outsourcing can help an organisation gain a competitive edge!

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