Web-Based Instruction Specialist Training Program Samsung 1 Issues of Strategic HRM 1Copyright © Doo H. Lim Review SHRM Conference Day 3 Doo Hun Lim University of Tennessee Korea Management Association

Web-Based Instruction Specialist Training Program Samsung 2 Issues of Strategic HRM 2Copyright © Doo H. Lim 2005 SHRM Themes or Trends u Value matters u Adaptation to survive u Strategic HR to business strategy (strategic partnership) u HR roles & competencies u Softside of Human Resources (self- motivation, self-leadership).

Web-Based Instruction Specialist Training Program Samsung 3 Issues of Strategic HRM 3Copyright © Doo H. Lim 2005 SHRM Themes or Trends u Leadership u HR Technology trends u Strategic HR u Adaptation and value-driven HR

Web-Based Instruction Specialist Training Program Samsung 4 Issues of Strategic HRM 4Copyright © Doo H. Lim Challenges Facing HR Today War for Talent Aging Workforce Off-shoring/Outsourcing Rising Healthcare Costs Managing Diversity

Web-Based Instruction Specialist Training Program Samsung 5 Issues of Strategic HRM 5Copyright © Doo H. Lim War for Talent "Research shows the impact that effective top leadership has on shareholder value -- it goes up by almost 11 per cent"

Web-Based Instruction Specialist Training Program Samsung 6 Issues of Strategic HRM 6Copyright © Doo H. Lim Future Talent Shortage “The United States could experience a labor shortage of 35 million workers [by the year 2030]. "

Web-Based Instruction Specialist Training Program Samsung 7 Issues of Strategic HRM 7Copyright © Doo H. Lim Aging Workforce “The number of people aged 55 and older will increase to 73% by 2020, while the number of younger workers will grow only 5%. (U.S. Census Bureau)"

Web-Based Instruction Specialist Training Program Samsung 8 Issues of Strategic HRM 8Copyright © Doo H. Lim Off-Shoring is Accelerating “The number of people aged 55 and older will increase to 73% by 2020, while the number of younger workers will grow only 5%. (U.S. Census Bureau)"

Web-Based Instruction Specialist Training Program Samsung 9 Issues of Strategic HRM 9Copyright © Doo H. Lim Outsourcing Trends u According to an Accenture survey of European and North American executives, more than 80% of respondents expressed a commitment to permanently outsourcing at least one key business function. u IDC, a Massachusetts-based Market Research firm, stated that companies spent $56 billion on IT outsourcing in 2000 and expect spending to top $100 billion by u Forrester Research predicts that 2.2 million white-collar positions will shift abroad by 2015.

Web-Based Instruction Specialist Training Program Samsung 10 Issues of Strategic HRM 10Copyright © Doo H. Lim Other Trends u Rapidly rising healthcare cost u General Motors now spends about $1,500 on health care for every car it produces. u Diversity in the workplace u By 2050, 85 percent of the entrants into the work force will be people of color and women. The best of those entrants will be looking for companies with effective diversity programs.

Web-Based Instruction Specialist Training Program Samsung 11 Issues of Strategic HRM 11Copyright © Doo H. Lim Some Questions to HR u Should HR have a role in business strategy development? u Is the role of HR to ensure the organization has the necessary talent required to execute its business strategy? u Is HR responsible for optimizing healthcare costs/benefits? u Is HR responsible for ensuring that employee effort is aligned with the interests of the business, its customers and shareholders? u Does HR have a responsibility to help identify opportunities to outsource/offshore key processes?

Web-Based Instruction Specialist Training Program Samsung 12 Issues of Strategic HRM 12Copyright © Doo H. Lim Value-based Management u Value creation u Process deconstruction u Competitiveness

Web-Based Instruction Specialist Training Program Samsung 13 Issues of Strategic HRM 13Copyright © Doo H. Lim Value Driven Competition u Whose value? Customer ValueShareholder Value Average value? vs. Most common value? Segment of one IT impact Change in value focus Balancing internal to external value IR activity

Web-Based Instruction Specialist Training Program Samsung 14 Issues of Strategic HRM 14Copyright © Doo H. Lim Value Based Management u Shareholder value – Market value (TSR, TBR) IndicatorIndicators Value Ratio CVA EVA CFROI ROGI ROE ROA...

Web-Based Instruction Specialist Training Program Samsung 15 Issues of Strategic HRM 15Copyright © Doo H. Lim Implication for HR Strategies u Value driven people u Value driven organizational structure and culture

Web-Based Instruction Specialist Training Program Samsung 16 Issues of Strategic HRM 16Copyright © Doo H. Lim Process Deconstruction u Value chain – value adding process within an organization u Value chain deconstruction u Traditional value chain – integrated u Contemporary value chain – web u Why deconstruction?

Web-Based Instruction Specialist Training Program Samsung 17 Issues of Strategic HRM 17Copyright © Doo H. Lim Types of Process Deconstruction u Layer master u Orchestrator u Market maker u Personal agent

Web-Based Instruction Specialist Training Program Samsung 18 Issues of Strategic HRM 18Copyright © Doo H. Lim Implications for HR Strategies u Transparent HR policies and practices u Localization of HRM u Globalization of HRM u HR legal arrangement for new biz pattern u Required competencies for new employees u Creativity u Challenge

Web-Based Instruction Specialist Training Program Samsung 19 Issues of Strategic HRM 19Copyright © Doo H. Lim Sustaining for Competitiveness u Cost competitiveness u Time competitiveness

Web-Based Instruction Specialist Training Program Samsung 20 Issues of Strategic HRM 20Copyright © Doo H. Lim Cost Competitiveness u Experience curve u Unit production cost is reduced 20~30% when the total production doubles its number. -> cost competitiveness u Factors contributing to this effect u Fixed cost reduction – equipment, marketing cost, R & D, infrastructure (IT), training, etc. u Variable cost reduction – materials, labor, energy

Web-Based Instruction Specialist Training Program Samsung 21 Issues of Strategic HRM 21Copyright © Doo H. Lim Implications for HR Strategies u Innovation in production technology u Organizational flexibility for process reengineering u HR cost reduction u Recruit skilled workforce u Train and develop competitive workforce

Web-Based Instruction Specialist Training Program Samsung 22 Issues of Strategic HRM 22Copyright © Doo H. Lim Time Competitiveness u Time is money u Time reduction helps: u Improve productivity u Obtain price competitiveness based upon reduced time value u Reduce risk by shortening time for product needs forecasting (for seasonal products. i.e. cloths, shoes, etc.) u Expand market share

Web-Based Instruction Specialist Training Program Samsung 23 Issues of Strategic HRM 23Copyright © Doo H. Lim Examples of Time Based Competition u FedEx u Customer assembling products u Sony

Web-Based Instruction Specialist Training Program Samsung 24 Issues of Strategic HRM 24Copyright © Doo H. Lim Implications for HR Strategies u Forecasting of HR demand and supply u Information free flow system and culture -> information creation, sharing, application u Promoting OODA work flow u Observation u Orientation u Decision u Action u Empowerment for speedy decision making

Web-Based Instruction Specialist Training Program Samsung 25 Issues of Strategic HRM 25Copyright © Doo H. Lim Wrap Up u Questions u Concerns