Executive Summary 3
Introduction 4
The Workforce as a Competitive Advantage 5
How to Value and Retain Employees 7
Proper Recruitment Strategies 7
Staff Socialization 8
Training and Development of Staff 8
Compensation and Rewards 9
References 12
Executive Summary
All the resources of an institution are crucial in the development and achievement of the objectives of a given business entity. It is essential for the management of an institution to properly manage the resources. However, the human capital is regarded as the most vital resource of an institution. Its skills, competencies, knowledge, and innovativeness, are essential in the growth of human resource management. Businesses must ensure that they retain their workers to achieve the set objectives. Staff turnover can be expensive to the company as well as the employee. Therefore, retaining employees is an important task of the management.
Keywords: Turnover, human resource management, capital, skill, competencies
Introduction
The human resource is one of the most valuable resources of any institution. It is essential for the workforce to be properly managed for a business to achieve competitive advantage over other businesses. Managing the human resource involves effective and adequate staffing, scheduling, forecasting, as well as making real-time adjustments. In the contemporary business world, human resources play a crucial role in ensuring that an institution meets its objectives. The workforce holds the key to the success of a given business idea. For instance, the creativity, skill sets, as well as abilities are essential in the generation of ideas aimed at achieving competitive advantage over rivals.
The success of businesses is highly dependent on the knowledge, creative activity, experience, qualification of the employees. Additionally, continuous research and training play a major role. In the management of human resource, the most crucial stage is the recruitment (Price 2011, p. 354). Proper management of human resource begins by selecting the right individuals to perform certain functions in the firm. When an institution has the right people for the right job, the managers find it easy to work with them for the achievement of institution's objective. It is crucial for a company to retain its best employees. Hiring as well as retention of employees is critical to the success of business.
The employees should feel appreciated and valued for an institution to retain its workforce (Price 2011, p. 291). The appreciation of workforce can be done through motivation, encourage innovativeness, communication of the business mission, and fostering the development of the human resources. Additionally, the firm can cultivate a positive business culture by providing opportunities for growth, as well as mentoring programs. Creating proper strategies for retention of the employees is essential for the success of a given institution.
The Workforce as a Competitive Advantage
The achievement of the goals and objectives of a given company hinges on the performance of its workforce (Kumar 2015, p. 37). The experience, skills, knowledge, and creativity of workers can assist in the development of an institution. The primary strength of an institution comes from its workforce. An institution that recognises employees as assets rather than expenses has an enormous growth potential. Positive employment terms can lead to improvement in the relationship between the management and the employees. When the employer-employee relationship is positive and provides room for dialogue and growth, the company can be successful.
The human assets play a major role in sustainable competitive advantage (Chaston 2012, p. 21). The management needs to trust their workers through challenging and specific tasks. The employees will naturally respond with high motivation, commitment, and performance. The most common factors for success include top management commitment, aspirations, and motivation of the recruits. The basic competencies of the management and the ability to build, maintain, and develop alliances or the global integration of the guarantee business success. Most of these factors are related to the human resources and its relationship to the management. Therefore, proper development of the human resource has a potential to give businesses a competitive advantage.
In the past, the central source of competitive advantage laid on the size of a company's budget. However, there has been a shift from financial and technological resources to human capital. The success of an institution depends on employee competencies and skills, attitudes, ability to generate trust or commitment, as well as aspirations (Kumar 2015, p. 158). The human resource of an institution can implement a particular competitive scenario and generate strategic capabilities. Through proper management of human resource, the firm can be more intelligent compared to its rivals. The human resource view of competitive advantage is referred to as the capabilities model.
The capabilities model or the human resource model (HRM) enables the management to think clearly on the quality of workforce required for the success of an institution (Boella & Goss-Turner 2013, p. 27). The human capital entails the experience, skills, and knowledge that are inherent in the employees (Chaston 2012, p. 18). These resources are often taken away by the employees when they leave the firm. In a broader sense of the term, it includes innovativeness, persistence, adaptability, loyalty, devotion to the institution, as well as the ability to start and maintain relationships. The activities of any institution depend on the human resource. The workforce has certain unique characteristics that make it an essential resource. It is the only resource whose value does not decrease with use and has a high capacity for self-development. Additionally, the unique competencies provided by the human resource cannot be easily copied by other institution.
One of the most valuable resources of an institution is knowledge. It has a substantial impact on the competitiveness and growth of the market. Firms need to learn and adapt. This is only possible through the use of human resources (Pinheiro, Benneworth, & Jones 2015, p. 304). The manifestation of knowledge can be in two forms, that is, explicit and implicit knowledge. The creation and development of this knowledge help a company to often stay ahead of its competitors. Adequate knowledge enables the workers to perform to their best leading to improved production. The introduction of experienced individuals in an institution's system gives other workers a chance to learn from their experienced counterparts. The integration of developed and developing human resources is essential in ensuring the business maintains its knowledge base.
Innovativeness of the workforce is also vital in ensuring competitive advantage. Through its workforce, a firm can develop an innovation that offers it a competitive advantage over it rivals. For a company to be dominant in the market, it has to invest in research, training, as well as the development of its workforce (Chaston 2012, p. 75). A company can produce high quality goods at lower prices through innovative techniques. A company has to appreciate and reward the most creative individuals in the workforce to ensure it maintains the innovativeness of the workforce. The appreciation results in mass innovations within the company. Therefore, innovativeness of the workforce is crucial.
How to Value and Retain Employees
One of the most important aspects of an institution is the retention of its workforce. Constant employee turnover can affect an institution since the company needs their experiences, competencies, as well as skills. Recruiting new employees affect the company in terms of time required for the new hires to adapt (Martin 2010, p. 34). Additionally, the experience needed for certain business operations may not be available for the new recruits. Retaining of employees does not necessarily mean keeping all the employees. Retaining the most important individuals is crucial. To retain the employees, they need to feel appreciated and valued. The management must find ways of ensuring the employees are valued.
Proper Recruitment Strategies
Retention of the workforce requires some approaches. These strategies also have a potential of making the employees feel valued (Roberson 2012, p. 242). These strategies involve proper recruitment, training and development, employee engagement, compensation or rewards, as well as socialization of the workforce. Recruitment affects turnover in every institution. When the applicants are provided with job previews that are realistic, the retention of the workforce may be influenced. Realistic job previews (RJP) provide accurate and adequate information to an individual. Additionally, the RJP provides employees with the expected performance level required. Through the RJP, the new recruits can feel that the management cares for them.
Staff Socialization
Staff turnover is usually common among the new recruits. It is believed that inadequate socialization, as well as integration into the culture of the institution, has a role to play in the staff turnover. Through individualized and shared learning experiences, the new recruits may learn particular adaptation skills. The social learning theory by Cornell states that people learn from social places through interaction with different individuals (Lankshear & Knobel 2011, p. 210). According to the theory, learning has four primary stages. These steps include close contact, imitation of superiors, understanding of the basic concepts, as well as adopting the behaviour of the role model. Therefore, socialization is a crucial component in the retention of the workforce. The institution can involve the experienced employees as mentors, trainers, as well as role models
Training and Development of Staff
Training and development of the institution's employees can also make them feel valued. It also has the potential of reducing staff turnover. However, certain individuals may quit an institution citing excessive training (Pinheiro, Benneworth, & Jones 2015, p. 308). When pieces of training are used in ensuring retention of workers, they should be moderate. Additionally, it is crucial for the management to offer training that is unique to the job. This enables the employees to grow their careers. The company can also reimburse training fees for employees who paid their fees for the same training. The reimbursement can be done by experience and the length of stay in the institution.
Compensation and Rewards
Compensation and rewards play a crucial role in the motivation of employees. If a given company fails to offer rewards that are competitive, it becomes difficult for it to attract and retain employees. The firm should ensure that it leads the market regarding compensation and rewards. This helps in attracting highly skilled and competent individuals to the institution (Roberson 2012, p. 379). In fact, the existing employees would not leave the company due to the competitive rewards. When the firm rewards certain productive behaviours, they encourage the employees to work harder. The repetition of a given action since it is rewarding is in line with the reinforcement theory by BF Skinner (D'ydewalle 2012, p. 61). The author states that the human behaviour is influenced by the reward of punishment attached to the behaviour. A high performance followed by a reward makes behaviour easily repeatable.
The rewards and compensation approach should be in line with the human resource strategy as well as the overall strategy of the institution. Other than the basic pay, an institution can still lead the market of bonus given for achievement of an institution's objective (Brewster & Mayrhofer 2012, p. 139). Tailoring rewards to the individual employee needs may also work in motivating the workers. The employees have different tastes and preferences regarding rewards. Therefore, giving rewards based on individual preferences can have a greater impact compared to other rewarding techniques.
Additionally, rewards and compensation can be tied to retention. Most companies offer most of their prestigious compensation packages and rewards to their most experienced employees. Vacation hours can be tied to seniority in the firm. Retention bonuses can also be offered to employees who have stayed with the firm for a specified number of years. These rewards are always associated with longer institutional tenures. However, the rewards can also affect the productivity of the firm. In particular individuals, the rise in basic salary or rewards leads to decreased production. Besides, the individuals left out of the compensation plan may protest against such decisions leading to silent grudges and reduced productivity.
Conclusions
Human resource management is an essential component of an institution. The success of a given institution depends on the performance of the workers (Pinheiro, Benneworth, & Jones 2015, p. 174). Most of the activities performed in an institution depend on the creativity, skills, knowledge, as well as experience. The employees are essential to the achievement of the mission of the institution. Therefore, every employer must work towards retaining his or her employees. The strategies for keeping the employees should enable them to feel valued. When the workers feel appreciated and valued, they tend to work harder for the benefit of the firm. Some of these strategies are expensive in the short-term due to the high expenditures accrued. For instance, rolling a reimbursement of fees project to already trained employees may be costly to the company. However, in the long-run, it leads to high productivity due to employee retention.
Proper management of the human capital of an institution can provide a competitive advantage to the firm. The innovativeness of the employees can make a business to stay ahead of its rivals (Pinheiro, Benneworth, & Jones 2015, p. 308). The experience and knowledge of the workforce also have a role to play in the success of the institution. Additionally, the unique characteristics of human capital as a resource make it an essential component in the success of business. The self-training capacity of human capital, as well as the indefinite growth potential, is unique to human resource. Therefore, it is essential for all institutions to think of the human resource as an asset rather than expenditure. This can enable the management of a firm to concentrate on the growth as well as development of the human resource.
References
Boella, M. & Goss-Turner, S., 2013. Human Resource Management in the Hospitality Industry: A Guide to best Practice. London: Routledge.
Brewster, C. & Mayrhofer, W. eds., 2012. Handbook of Research on Comparative Human Resource Management. Camberley: Edward Elgar Publishing.
Chaston, I., 2012. Strategy for Sustainable Competitive Advantage: Surviving Declining Demand and China's Global Development. London: Routledge.
D'ydewalle, G. & Lens, W. eds., 2013. Cognition in Human Motivation and Learning. Oxfordshire: Psychology Press.
Kumar, D., 2015. Building Sustainable Competitive Advantage: Through Executive Enterprise Leadership. Burlington: Ashgate Publishing, Ltd.
Lankshear, C. & Knobel, M., 2011. New Literacies. Berkshire: McGraw-Hill Education (UK).
Martin, J., 2010. Key Concepts in Human Resource Management. London: Sage Publications.
Pinheiro, R., Benneworth, P. & Jones, G.A., 2015. Handbook of Research on Global Competitive Advantage through Innovation and Entrepreneurship. Boston: Cengage Learning.
Price, A., 2011. Human Resource Management in a Business Context. Boston: Cengage Learning EMEA.
Roberson, Q., 2012. The Oxford Handbook of Diversity and Work. Oxford: Oxford University Press.
