Human Resource Management: Strategy and Policy (HRM2001S) Assignment 1Human Resource is the most important asset of an organisation
Soh Wei Sheng Fabian
Student Number: 12262455
Submission Date: 6 Jun 13
Statement of Authorship
I declare that all material included in this essay/report/project/dissertation is the end result of my own work and that due acknowledgement have been given in the bibliography and reference to ALL sources be they printed, electronic or personal.
Assets can be defined as "tangible and intangible resources of a firm which can be drawn upon by a the firm when required to achieve its objective(s)" (Ray and Ramakrishnan, 2006). Tangible assets include financial and physical assets such as machineries and manufacturing plants while examples of intangible assets are branding, company reputation, technological know-how and human resource (Noe et al., 2012). Human resource is the most important asset of an organisation. Using studies which showed that effective use of human resources contributed to better corporate performance and/or productivity, this essay attempts to show that this intangible asset is a key driver in the survival and competitiveness of an organisation. SUCCESSFUL ORGANISATIONS
For organisations to be successful, they need to survive and obtain an advantage over their competitors. There are many ways to attain a competitive advantage, including patented product and process technologies, protection and regulation of domestic markets and access to financial resources (Pfeffer, 1994). However, the aforementioned contributors of success are deemed to be less relevant in today's societies because technologies can be imitated, markets are increasingly globalised and global capital markets ever more opened for worldwide movement of financial resources (Pfeffer, 1994). Instead, in today's organisations, it is widely accepted that employees are key strategic resources for companies because their knowledge, expertise, ideas and services drive innovations, steer product developments and build relationships with clients. This in turn increase companies performances through multiple means such as driving profits, increasing productivity and building large customer bases. For example, Sears, a multinational US company, attributed its transformational success through its believe in the 3"Cs" of "Compelling Place to Work", "Compelling Place to Shop" and followed by "Compelling Place to Invest" (Yeung and Berman, 1997). The senior management at Sears believed that by optimising its human resources (through shaping of employee's attitudes, increasing motivation and skills), it will become an attractive venue for customers to shop with high level of satisfaction. Consequently, it will be a good investment option due to strong financial results (through increase in customer expenditure) and productivity (through optimisation of human resources) (Yeung and Berman, 1997). Strategically valuable resources may give companies a competitive edge. Bartlett and Ghoshal (2002) argued that there is an evolving corporate strategy from one that competes for markets and products, to one that compete for resources and competencies, to the current strategy of competing for talents and dreams. Resources are deemed to be valuable when they cannot be easily imitated, their value depreciate slowly, they cannot be easily substituted and they are relatively better than competitors with similar resources (Collis and Montgomery, 2008). While these resources may be tangible or acquired capabilities, it is the view of this author that it is people that best fit the described characteristics of valuable resources. Creativity and expertise of an employee may not be easily duplicated. It takes time to groom talents, and their experiences and competencies cannot be easily replaced. Thus, to gain a competitive edge, companies need to invest in the hearts and minds of the key success factor -...
References: Bartlett, C.A. and Ghoshal, S. (2002): 'Building Competitive Advantage Through People ', MIT Sloan Management Review, 43(2): 34-41.
Camelia, B. (2012): 'Human Capital 's Impact on the Performance of Romanian Knowledge Based Companies ', Annals of the University of Oradea, Economic Science Series, 21(2): 337-342
Collis, D.J. and Montgomery, C.A. (2008): 'Competing on Resources ', Harvard Business Review, 86 (7/8): 140-150
Liao, C.H., Mo, S. and Grant, J. (2011): 'Marketing Implication of Human Capital Investment in Training ', Academy of Accounting and Financial Studies Journal, 15: 59-87
Noe, R.A., Hollenbeck, J.R., Gerhart, B
Ojo, O. (2011): 'Impact of Strategic Human Resource Practice on Corporate Performance in Selected Nigerian Banks ', Ege Academic Review, 11(3): 339-347
Ray, S. and Ramakrishnan, K. (2006): 'Resources, Competences and Capabilities Conundrum: A Back-To-Basics Call ', Decision, 33(2): 1-24
Rucci, A.J., Kirn, S.P
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