Developing an organisation

WE’VE all heard the adage that people are an organisation’s most important asset.

Along the same lines, recent literature seems to indicate that people-management issues are viewed as a key platform for future organisational success in the new millennium.

However, the extent to which this vision is realised (in many cases) will be influenced by the reputation and professionalism of an organisation’s human resource department.

In recent times there has been an exponential growth in the diversity of “outsourced” people-management services, the majority of which have embraced the information super-highway to cross geographical and organisational boundaries.

Yet it appears that, while this change has occurred, the internal human resource function has continued to operate from its traditional paradigm – that of reacting to requests and maintaining control of people activities through the management of ‘administrivia’.

While the need for risk management (employee relations) and payroll services remains, the primary focus of the human resource function needs to move away from these housekeeping services to one of organisational development.

The fundamental issue facing most human resource practitioners (and, in fact, organisations) is determining what exactly is meant by this concept of organisational development?

Traditional theories of organisational development embrace three key concepts:

p individual development – interventions designed to enhance the capabilities of an individual in line with a specific job or task;

p career development – interventions designed to enhance the career planning/management activities of individuals;

p organisational development – interventions designed to enhance organisational performance, such as market research, industry analysis, competitor profiling, human resource planning, continuous improvement etc.

The difficulty for human resource professionals is that the concept of organisational development goes beyond their traditional scope, and resistance comes not only from their internal customers, but also from within their own ranks.

We have seen through the 1990s the continuous downsizing and outsourcing of human resources areas in large organisations, together with other corporate support areas, as this was seen as an easy target, a “cost centre”, rather than a revenue generator.

Outsourcing of such human resource functions as recruitment was justified on a purely cost basis, without consideration to the impact on the long-term effectiveness of the organisation.

In a recent survey undertaken by the Institute of Management Consultants of CEOs based in Melbourne and Sydney, 21 of 72 respondents indicated that people-management issues were the most important issue and/or challenge that their business would face over the next five-year period.

The prime areas of concern included: building strong leadership; retaining key staff; building enthusiasm; effective succession planning; attracting enough new young entrants; recruiting new staff; managing change/improvement issues; transitioning people to new skills and careers; developing people’s ability to cope with uncertainty; and supporting people to cope with rapid organisational change.

As technology rapidly changes the nature of work and creates new demands for management agility, the challenge is to attract, motivate and retain the right people with the right skills and capabilities.

The challenge for human resources is to reposition itself within the corporate world and sell the benefits of its services in line with the principles of organisational development. The challenge for many will be, how to sell, what to sell and to whom.