User:Pramuka Aravinda/sandbox

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How future practices of HR help organizations to manage a crisis?
''' People, society and organizations had to come across many challenges within last two decades more frequent than before. Financial crises, natural disasters, terrorist attacks and global pandemics have adversely effected organizations’ growth, profitability and overall business models. Dot com bubble burst, 2008 financial crisis, 9/11 attack, Asian banking crisis, hurricanes, US China trade war and pandemics are common examples for the challenges that organizations have been came across during past two decades. Globalization and dynamic nature of markets spread the sensitivity across the globe more than ever before. As per the website ft.com, Lufthansa was given Euro 9 Billion to cover up losses during the pandemic. JP Morgan, Wells Fargo and Berkshire Hathaway tops the negative performance in financial sector, Saudi Aramco, Shell, Exxon Mobil from energy sector and Boeing, Airbus from industrial sector. (Dodd, 2020) It is quite evident that organizations have to go through such turmoil irrespective of the industry sector they are in. However, organizations are not capable of controlling most of the crises because root causes can be political, social, economic and ecological. Building, transforming and reshaping into more robust, responsive and flexible organizations is the best of all options in order to overcoming crises. HR is the most important resource and the driving force of the organization, which has the ability to change the shape of the organization in order to absorb these shocks and run smoothly. In a shaky situation, proper delivery and organizing of talent, organization and leadership becomes even more crucial. (Ulrich,2020). Therefore, it is necessary to evaluate whether current HR practices and principles in organizations will deliver the expected results or not. First and foremost, it is necessary to identify what are the qualities that an organization should possess in order to overcome a crisis. Ion Mitroff’s six stage crisis management model gives an ideal view of the steps that an organization should follow in a crisis. Early detection of a crisis is important to keep the organization in an advantageous position in managing crisis. Identifying signals very early and responding to them accordingly is important to minimize the damages to the organization. For an example spreading patterns and number of positive cases in Covid-19 can indicate the possible lock-down areas. Preparation to the upcoming crisis is the second step and which includes preparation of business continuity plans, disaster recovery plans, pipeline mapping and other contingency plans. Most of the organizations keep business contingency plans ready in advance since it has become a hygienic factor among the corporate world. Implementation of the contingency plans is the third step of the process which is known as crisis containment. Organizations might need to customized the pre-prepared plans according to the new crisis circumstances in ways that they keep the impact minimum to the business. Fourth step is the crisis recovery and it is the process that business getting transformed into its usual position. Fifth and sixth steps are mainly on assessments of the performance when managing the crisis, adding learnings from the crisis and re-shaping the management process. (Gibbons, 2020) This process is entirely depending on HR of the organization and the success of the process depend on the attributes of HR team of the organization. HR teams that understand social, political, economic, technological and ecological factors and keep due-diligence over factors that has implications to the business is vital to manage a crisis successfully. Overall knowledge on the context of the business and its functionality is another important attribute of HR team specially when forming contingency plans to the organization. Flexibility and responsiveness are other factors which are affecting all stages of crisis management process.

The article named “The role of HR in crisis management” by Dave Ulrich in HR strategy and planning excellence essentials magazine points out several important attributes that an HR team should possess in an organization when it comes to crisis management. The best journal article that discusses about futuristic HR practices is “Are we there yet? What’s next for HR” by Dave Ulrich and James H. Dulebohn. The journal discusses about the evolution of HR in four phases namely HR administration, HR practices, HR strategy, HR and context. The approach that organizations take to move from HR practices to HR and context is called outside inside approach. Outside inside approach is about transforming existing HR practices and its value addition into something that can be viewed from the outside of the organization. In other words, the future HR practices, principles will be designed, transformed, reshaped and deliveries with outcomes will be more transparent in order to see it to the outsiders of the organization. The journal discusses about ten criteria of how future HR structure should be. It is possible to analyze these criteria and evaluate each and see how they help to manage and overcome crisis effectively. HR’s value addition to the business is the first criteria and it is about enhancing and improving the relationship HR with the business functionality. This is very important in crisis management since HR’s duty is to make changes to organization operations and provide leadership to employees in a crisis. The HR decisions taken in a crisis should be sensible and it should make minimum impact to the flow of business operations. An HR structure that continuously add value to the business, care about organization’s operation while comparing outside environment is a blessing to any organization in managing a crisis. Secondly, improving HR’s awareness of business context factors is another important aspect in applying future HR practices. Having knowledge about social, technological, economic, political, environmental and demographic trends are the key context factors that HR should improve their awareness of. The knowledge of all the above factors is vital when facing a crisis to lead employees in an effective way. For example, finding answers to problems in a crisis such as what are the new emerging market trends? What are the feasible new technologies can be applied to the business and what are delivery focuses on what demographics? Third criterion is stakeholders of the organization and the expectations of them. Managing stakeholders in a crisis situation is difficult to any organization. The futuristic approach of HR in managing stakeholders will be categorized into five areas; which are investors, community, line manager, employee and customer. Implementing policies and reshaping structures that add value to the organization in investors perspective and working on winning the confidence of investors is one stakeholder area in the categorization. Community is another stakeholder and working on improving reputation of the organization is a duty of a future HR team. Other three stakeholders are customer, line manager and employee and the futuristic HR approach would be increasing customer share, employee productivity and line managers’ strategy execution. Competence, commitment and contribution will be focused in terms of employee productivity perspective will be overviewed as the talent of the organization and which is the next criterion. In brief, other criteria are right leadership for the organization, organizational capabilities, correct structure of the HR department, Right practices of HR, people and analytics. (Ulrich and Dulebohn, 2015) The HR principles mentioned in above mentioned criteria perceives by the organization in a way that they have improved transparency (since the HR architecture will be planned to be able to overlook and understand for outsiders of the organization) and add value to the overall organization. The ultimate benefit from these practices to the organization are, enabling to align employees easily to organizational goals, to have better retention rates and to have a set of employees who work from their full potential. The HR structure with such characteristics will be highly cooperative when applying Mitroff’s six stage crisis management model.

Conclusion Journal on FPE (financial participation of employee) organizations performance in 2008 financial crisis, based on IAB Establishment Survey (2007-2011) found that organizations with highly qualified employees have performed well irrespective of the financial preparedness in a crisis. (Bellmann and Moller, 2016) The importance of having a quality employee cadre is obvious when managing a crisis and it is necessary to have HR practices in an organization that offer quality employees as an outcome. Cisco leadership learned the importance of having a various mode of communication system in 2011 Japanese tsunami. It took more than a week to identify and locate 1400 Cisco employees to HR in order to ensure security. It is HR’s whole responsibility to maintain high levels of communication and be proactive when there is a crisis and communication is important element of crisis management process. (Parsi and Parsi, 2020) Outside/inside approach is extended its influence to every corner of HR and correct application of it can work positive for the organization. What is important in crisis management is a proactive and amplified version of an HR with futuristic practices under normal conditions and that is the reason why it is possible to find all the answers from outside/inside approach to all stages of Mitroff’s crisis management model.