1. 1 Objectives 1.Highlight major changes shaping the twenty-first-century workplace. 2.Understand demographics of the new work force. 3.Explain “managing diversity” and why it is important today. 4.Discuss effects on management from the political-legal environment 5.Discuss effects on management from business cycles and globalization

2. 2 Major Changes in the Workplace Virtual Organizations Just-in-Time Workforce Knowledge Workers e-Coaching and e-Monitoring Increased Diversity Aging Workforce Dynamic Workforce

3. 3 Virtual teams More communication-intensive –but lose contextual cues/voice Asynchronous (24/7) Dispersed Implications for management: characteristics of virtual team members - self discipline, social needs...

4. 4 JIT Workforce Contingent, temporary, freelance workers Essentially outsourcing Creates a hiring pool - for “permanent” positions Trust & loyalty an issue? Implications: which functions should managers outsource - or not outsource?

5. 5 The Social Environment “The organization is an arena where interests are mobilized” Dimensions of the social environment –Demographics Changes in the statistical profiles of population characteristics. –The new social contract Changes in the employer-employee relationship. –Inequalities Persistent barriers –Managing diversity Creating organization cultures that enable all employees to realize their potential.

6. 6 Demographics of the New Workforce Needed Remedial Education –The shrinking U.S. workforce is increasingly deficient in reading, writing, science, and basic math skills.

7. 7 Source: International Adult Literacy Survey Skill Level of Three Workforce Categories

8. 8 Demographics The workforce will have more Hispanics and older persons in the future. Labor force growth rate is declining

9. 9 Source: U.S. Bureau of the Census, HRI Baby Boom b.1946-64 Baby Bust b. 1965-83 Percent of Baby-Boom and Baby- Bust Generations by Race/Ethnicity

10. 10 Annual Growth Rate of U.S. Labor Force

11. 11 Demographics of the New Workforce Myths About Older Workers (Dispelled) –Are not less productive. –Do not incur higher benefits costs. –Do not have higher absenteeism. –Do not have more accidents at work. –Are not less willing to learn. –Are not inflexible about the hours they are willing to work.

12. 12 A New Social Contract Between Employer and Employee New Social Contract –Employer-employee relationship will be shorter-term, market-based. Employees are expected to manage their own careers to increase their long-term value. Employers are expected to provide the means necessary for continual workforce development.

13. 13 Nagging Inequalities in the Workplace Under the Glass Ceiling –Women continue to experience a significant gender-wage gap and strong barriers to advancement. –Women are demanding more equitable compensation and workplace opportunities.

14. 14 Source: Catalyst’s Census of Women Corporate Officers and Top Performers; HRI Women in Top Management 46% of the U.S. Labor Force 48% of Managerial/Professional Specialty Positions 10% of Corporate Officers 9.5% of Board Directors 2.4% of Highest Titles 1.9% of Top Earners Two Fortune 500 CEO

15. 15 Source: Federal Glass Ceiling Initiative; HRI While minorities make up almost 22 percent of the U.S. workforce...... they represent only 2 percent at Fortune 2000 firms. White 78% White 98% Minorities 22% Minorities 2% Minorities in Top Management

16. 16 Nagging Inequalities in the Workplace (cont’d) Part-Timer Promises and Problems –Contingent workers will comprise a increasing percentage of the workforce. –The advantages of lower wage and benefits costs and the flexibility of a contingent workforce are offset by their negative work attitudes and increased likelihood of quitting. Continuing Pressure for Equal Opportunity –Women, minorities, and the physically challenged are all expected to press harder for more employment opportunities

17. 17 Managing Diversity –The process of creating an organizational culture that provides all employees with opportunities to realize their potential –Requires testing of personal biases, learning More than EEO –The moral necessity to go beyond EEO and affirmative action –Multiple perspectives improve information and decision making - creating economic value

18. 18 The Political-Legal Environment Specific Political Strategies –Campaign financing –Lobbying –Coalition building –Indirect lobbying

19. 19 Increased Personal Legal Accountability Increases in Demands for Accountability –“Cooking the books,” price fixing, and bid rigging are serious white-collar crimes likely to draw stiff penalties and a jail sentence. E.g. Sarbanes-Oxley act 2002 Political and Legal Implications for Management –Increased use of legal audits A review of all operations to pinpoint possible legal liabilities or problems. –Use of alternative dispute resolution (ADR) Settling disputes with less costly methods, including arbitration and mediation.

20. 20 The Economic Environment The Job Outlook in Today’s Service Economy, Where Education Counts –Service sector job growth in high paying occupations that require at least a bachelor’s degree is twice as fast as that of all other occupations.

21. 21 Some Industries in the Service Sector Banking, stockbrokerage Lodging IT Insurance News and entertainment Transportation (freight and passenger) Health care Education Wholesaling and retailing Law Education Architecture Consulting

22. 22 The Economic Environment Coping with Business Cycles –Business cycles The up and down movement of an economy’s ability to generate wealth. Business cycles are converging worldwide (global interdependence).

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25. 25 The Economic Environment Cycle-sensitive decisions –Timing decisions about appropriate responses to changes in the business cycle is necessary to reduce the chances that a firm’s assets and resources will be underutilized or wasted in economic downturns. take advantage of opportunities that will arise during periods of rapid expansion of the economy.

26. 26 The Challenge of a Global Economy A Single Global Marketplace –Global trade is causing a shift to a single economy (e.g., WTO, EU, NAFTA) –The commercial world is no longer East-West, North-South. Globalization Is Personal –Working for a foreign-owned company is a growing trend (brand ownership, FDI). –Now a world standard for competitive quality and costs

27. 27 The Technological Environment Technological innovation –is concerned with tools and ideas that provide practical solutions –generates “Creative Destruction” (Schumpeter) –creates new products and businesses e.g., e-Business models, disintermediation, biotech

28. 28 The Technological Environment (cont’d) The Innovation Process –Concept –Product innovation –Process innovation

29. 29 Innovation Lag –The time it takes for a new product to be translated into satisfied demand. Shortening Innovation Lag –Goal setting: creating a sense of urgency and purpose. –Empowerment: pushing decision-making authority down to the level of the decision. –Concurrent engineering: using a team approach to product design involving specialists from all functional areas including research, production, and marketing. The Technological Environment (cont’d)

30. 30 Promoting Innovation Through Intrapreneurship Intrapreneur –An employee who personally shepherds an innovative idea through a large organization. Fostering Intrapreneurship –Focus on collaboration, innovation and risk taking –Tolerate/learn from mistakes –Requires managerial approaches to creativity individual and group dynamics, organization culture (more on this later!),