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What could be the biggest source of competitive advantage to an organization in the current era of cut throat competition? If I asked this question a decade or two decade, the answer would have been something like – ‘it’s the technology’, ‘its global presence’, ‘its customer perception’ etc. All of them can be a potential […]
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An important decision that confronts all aspiring management graduates is about the kind of business school that they would want to join after clearing the entrance procedures. This decision must be taken after due diligence is done on the various business schools and after careful thought has gone into the selection process. There are many […]
Maslows Hierarchy and Employee Engagement
How to tap the potential of employees who are not actively engaged or are disengaged? Yes, the management studies conducted over last few years have revealed that only 11 percent of the total employee strength is actively engagement and feels a strong commitment towards their work and workplace. The rest 89 percent of the employees […]
Tips for Giving Feedback after Assessments
Feedback after any form of assessment or evaluation helps in mirroring the information regarding their performance to the candidate and also initiates the learning process in them. An objective, transparent and respectful conversation needs to be conducted during feedback to drive home the points which the participant needs to work upon. Giving feedback is never […]
Employee Relations – Importance and Ways of Improving Employee Relations
Maintaining healthy employee relations in an organization is a pre-requisite for organizational success. Strong employee relations are required for high productivity and human satisfaction. Employee relations generally deal with avoiding and resolving issues concerning individuals which might arise out of or influence the work scenario. Strong employee relation depends upon healthy and safe work environment, […]
The previous articles discussed the role of the HRD function from a wide variety of perspectives. We have seen how the HRD function is pivotal to the success of contemporary organizations. This article compares the HRD function with regards to its relevance and operation in the manufacturing and service sectors.
Before launching into the salient aspects, it is pertinent to note that the human resources are more critical to the success of the organizations in the services sector as compared to their importance in the manufacturing sector. The primary reason for this is that human resources are considered as an asset and a source of competitive advantage in the services sector whereas they are yet another factor of production in the manufacturing sector.
The HRD function in the manufacturing industries is often concerned with payroll, administrative work and mediating between the management and the workers. Mostly, the manufacturing companies lean on the HRD function in times of labor unrest and strikes. On the other hand, the HRD function is pivotal to the success of the service sector companies as they are seen as enabling and empowering the employees in the services sector.
The point here is that in the service sector companies, the HRD function plays a more important role as the chief sources of competitive advantage in these companies are the human resources. In the services sector like the financial and technology companies, the brand value is measured according to the level of intellectual capital which is a derivative of the contribution of the human resources in the company.
Further, the services sector runs on human resources whereas the manufacturing sector uses machines and equipment as the key aspect of production. This means that the HRD function in the services sector has to ensure that the human resources are enabled and fulfilled to actualize their potential.
Especially with the prevalence of the RBV or the Resource Based View of the firm that treats human resources as being central to the functioning of companies, the services sector employs different methods and procedures to fulfill this aspect.
On the other hand, the manufacturing companies are still in the process of orienting their strategies towards the RBV and in many cases, they might not be able to do so since the mode of operation is fundamentally different from that of the services sector.
Finally, the manufacturing companies have classification of employees into blue collar and white collar roles which creates a barrier to the way in which they are treated and they in turn demand their rights.
On the other hand, the services sector has only white collar roles which mean that labor arbitration and mediating between organized unions and the management is virtually non-existent. This is an important and crucial distinction which often determines the differing perceptions of the HRD function in these sectors.
In conclusion, contemporary management theory has evolved to a point where the HRD function is being crucial in all sectors and the coming years might see a paradigm shift in the way human resources are conceptualized with the advent of knowledge worker in both manufacturing and services.
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