The role of human resources management in the new business designs : problematic of its internationalization

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(1)*\J\n$ti\\\tiQ de Dirección y Organización de Empresa.. Num. 2° TRIMESTRE. Cátedra de Político Económica de la Empresa ?SOf O í . » , SANTIAGO G*JC¡* ECHB/ARWA. THE ROLE OF HUMAN RESOURCES MANAGEMENT IN THE NEW BUSINESS DESIGNS Problematic of its Internationalization Prof. Dr. Dr Santiago García Echevarría Pro/, Dr. María Teresa del Val Nuñez Universidad de Alcalá de Henares. UNIVERSIDAD MM DE AIJCALÍ. Doc l-A-Ext2/95.

(2) CONFERENCIAS Y TRABAJOS DE INVESTIGACIÓN ^ v DEL INSTITUTO DE DIRECCIÓN Y ORGANIZACIÓN \ DE EMPRESAS I Núm. T Trimestre DDJECTOR : Prof. Dr. SANTIAGO GARCÍA ECHEVARRÍA ,,,Hí?.!Y.ífíS.l'?*R.PE ALCALÁ. 5900907432. THE ROLE OF HUMAN RESOURCES MANAGEMENT m THE NEW BUSINESS DESIGNS Problematic of its Internationalization. Prof. Dr. Santiago García Echevarría Prof. Dr. María Teresa del Val Núñez Universidad de Alcalá de Henares. Alcalá de Henares, 1995.

(3) Consejo de Redacción: Santiago García Echevarría (director) María Teresa del Val Joseba Araño. Secretaria y Administración : Elisa Moscoso. © Prof. Dr. Di. Santiago García Echevarría. Dirección del I.D.O.E. : Plaza de la Victoria, 3 28802 - Alcalá de Henares. Teléfono : 885.42.00 Fax : 885.42.00. EDITA: I.D.O.E. UNIVERSIDAD DE ALCALÁ I.S.B.N.:84 - 8 1 8 7 - 0 4 7 - 1 Depósito Legal: M- 4115 -1996. Imprime: «CAÍ UFKODUCCIONBS, U . P° de La Estación, 7 - 28807 Alcalá de Henares.

(4) INDEX Page. i.. nrntoDucnoN. //.. THE MANAGERIAL FRAMEWORK OF SPANISH. 5. FIRMS' HR EVOLÜTION..... 10. III.. THE HR MANAGERS IN THE COMPANIES. 20. IV.. WHICH ROLE PLAYS THE HR-DEPARTMENT IN. V.. HR MANAGERS1 CHANGE PROCESS IN THE. THE BUSINESS ORGANIZATION?. VI.. 31. SPANISH FIRMS. 38. CONCLUSIONS. 45. VII. REFERENCES. 47.

(5) I. INTRODUCTION Traditíonally, during many decades, the HR managcr, generally has played a minor role within the firms' managemcnt. Among the most prevailing reasons, we find:. *. The strong public regulation, in those issues concerning with the social and labour domains in the companies As a consequence, a legal-oriented perspective has been developed within those firms.. *. The constancy and long persistence of technological and organizative systems in corporations, has arisen an administrative oriented HR department. Thus, tbe domain of HR.

(6) administration, has undoubtedly been, the basic orientation of this área. The low market competence has obviously helped the related administrative orientation.. *. The companies' success key has not been identified in the HR ground, but in the creation of efficient functional structures. Human resources has been observed as minor elemente in business success processes.. *. The Spanish economy has traditionally suffered a severe public intervention. In the last 40 years we may appreciate this great difficulty in the markets' opening, as a consequence of a strongly developed shared valué system, influenced by the state's interference, as the regulatory body of economic and social issues.. These points have resulted in:. *. A "legal" dominance.

(7) •. A great resistance in behaviours, as a consequence of the lack of knowledge and experience about competitive and open markets, and the new corporate designs.. •. Trade unions have not been capable to assume the new competitive realm and the difficulties to adapt to them.. *. The lack of confidence on the human being, coming as a result of the minor role performed by the HR.. In this moment, the Spanish economy is facing a signifícant change, not occurred until the last years. It is precisely in this moment when a relevant institutional revolution is taking place; which implies for the fírsí time, the acceptance of an open and competitive economy. Thus, íhose institutions need to develop new flexibility -oriented methods and step up economic and social processes, as well as, institutional and individual behaviouxs.. So we can observe how increasing competence characterises, increasingly, companies' evolution. The answer to this constant change reality in the business concept needs a:. *. Growing dynamics in technological innovation.

(8) *. Increasing oollaboration schemes with other companies, creating new outsourcing channels.. *. Increasing europeisatíon, when not globalization of business activities. *. A greater link between the HR managers and the business activity. The implementation of all these topics require a cooperatíve perception of the company, focused in the reduction of coordination costs through a coiporate culture development. Corporate culture should coordínate more efficiently company's inwards, together with creating a corporate image to reduce coordination costs with the environment. Both cases deal with the creación of capital confianza.. As a consequence, a company should be understood as a valué set, that will permit:. *. To define the institutional dimensión through Corporate Philosophy.. *. HR strengths' knowledge through information disposal about the corporate culture.. 8.

(9) Just, after the conect defínition of both criteria, we can cstablish those guidelines defining delegation and decentralisation áreas with lower coordination costs. These valúes' management, doubtlessly is becoming one of the main function of HR managers.. VALUÉ SYSTEM. : :CORPORATIVE: PHKXJSOPHV::. : COBPORATIVE: ::::CULTORE ::. LEGItlMATION OFBEHAVKHJB8. MDMDUAL BEtWflOURS. HnrnmoNM.. : cHtttrtt:. BJVIRONMENT. 1NTEHNAL STRUCTURE ' managbia •yatonw. >socMy. ' organlsatln «trudura*. •mariwl. • InionncUon/oomnunicattón. '•le.. '•te.. Figure 1 Only through the defined corporate design, we will be able to proceed efficiently when defining: *. Company's management structures. *. Company's corporate marketing.

(10) That is why, for the fírst time in the Spanish history, managemeot is considered as a key strategic factor to assure a company's competitivity, starting to give primacy to HR management.. H. THE MANAGER1AL FRAMEWORK OF SPANISH FIRMS' HR EVOLUTION Today's dominant framcwork in the HR evolution in Spanish fírms is defíned by the following parameters:. *. A Iow productivity. *. A Iow corporate integration, and consequently, large raotívational difficulties.. *. The necessity to a HR orientation, more than to functions.. *. An inadequate rewarding system. *. Very hostile industrial relations.. 10.

(11) HUMAN RESOURCES MOTIVATION OF EMPLOYEES. 80. 40. 20. 1 2 S 4 5 « 7. 16 17 1» 18 20 21 22 23. Figure 2 HUMAN RESOURCES LABOUR INCENTIVES. 12. 3 4 5 8 7. 18 17 18 19 20 21 22 23. Figure 3. 11.

(12) We may appreciate, as a reference, how the inteinational comparison. (1). shows not a good position of the Spanish corporation in terms of. human behaviours. Therefore, motivation, rewarding structure, industrial relations, i.e., are among the last places within the industrial relations context.. HUMAN RESOURCES INDUSTRIAL RELATIONS 100. •i. / ' / <. 80. ti//. 80. 40. 20. 0. 1 2 9 4 S 6 7. 1» 17 1» 1» 20 21 22 23. Figure 4 We may find a logic answer to this issue if we observe the set of valúes applying to the human being in the Spanish and Germán corporate. 1. The World Competitiveness Repon 1992, ed. World Economic Fonun, 1992. 12.

(13) cultures®. We may appreciate that the Germán corporate culture is strongly aimed towards the human being ín their integrative designs, is not the same in Spanish corporate culture, with an instrumental dominance.. VALÚES OF CORPORAT1VE CULTURE SOJBESTONSABaJTY CT THEEMn.OVEE. 1 \. TEAM.WOAKING. / : ...:..y.. na EMPIOYZE IN THE DECOICNM. mesas WCME MTOMUnON <aOUT DECSION PROCE3S. : \ /. StUREAUSATlON M THE JO*. |. I 1. /. ntEEDOII TO OETEHMME JOBS" CONrEMTt. 1. \. A\ \SA... HUMMOUTION OF WORMNa. OMAMZAHON H THE wanKN6 rutes. 1. 9. ¿: 1HEEMK0VEEMTHE COMP«WTS»tSUUIS 0. 1. SO. 100. Figure 5. 2. del Val Núñez, M.T., Cultura Empresarial y estrategia de la empresa en España. Su realidad actual y su diseño del cambio. Ediciones Rialp, Madrid 1994. 13.

(14) MEAN COSTS BY WORKED HOUR Personnel direct and indirect costa WW(taDM). D Direct coste •indlrect Coste LABOUR COSTS / SALES VOLUME. <5«<7<S»707:(7Z7374757«777I7»M«It2«3MS5H87WS»»9»l»2 — SÍAD* — GERMANY. Figure 6. 14.

(15) As a consequence, Spanish labour unit costs are as expensive as those in the Federal Germán Republic*3'. Although, the comparison between the total labour costs in the two countries, shows how Spain represents, just a 60% of the Germán total labour cost.. The same fact could be applied to business profitability in cashflow terms. This ratio shows how tbe Spanish firms are far from the mínimum return to answer properly to change processes both in the technological field as in the opening of the economies and markets.. At the same time, social pressure is expected to grow sharply in the coming years, as a consequence of the lower incomes per head compared with our partners in Central Europe. Spain suffers, as well, a low disposal of social benefits within the European Union.. The adding up of low rewarding together with a scarce body of social benefits, carry up a situación marked with conflicts and antagonism in the HR área, that arise necessarily a new orientation. Thus, companies have to adopt a greater protagonism designing their own HR integration processes, as well as a greater participation in the design of their own social benefits in order to achieve:. *. A greater efficiency in the Spanish social system. 3. Véase Deutsche Bundesbank, Monatsberichte, de diferentes años y Banco de España, Central de Balances, de diferentes años.. 15.

(16) CASH FLOW / NET ASSETS. :;;;;;;. >•••. ; «. «3«<7MC»7971727J747S7<7T7S7»MSlt2S3MC5MS7MS»»9M»2 —SPADf — GERMANY. figure 7. *. Finns' capability to identify and intégrate the human being in their institutions. Which implies, as well, a new institutional design for the Spanish tiade unionism.. 16.

(17) Thus, human resources and companies face the following trends:. *. The necessity to adapt to institutíonal change processes, and, as a consequence, improve significantly productívity levéis. Company's. |. acceptance, those related. * WmCHKEQVlSES DJSTTTünONAL DESIGN. its. own designs and. •— — ' — ~ ~. ". '. --•. DISCOVBK BMSTINO VALÚES CORPORATE CULTOSE. CORPORATIVE PROIECT. to its environments.. ACCOHDMOTOTtaM BUSINESS STRATBGY DESIGN. 1 AccoxDmGmrr. The necessity to deregulate. ORGANIZATIONAL DESKJN. i. the. D4PLEMENTATION OF ORGANIZATIONAL CHANCE. social and labour legislation,. in. order to achieve enough. j. DBitAND ORGANIZATIONAL CHANGí. in. fields to. ADAPTING DWFICULTIES. i. competitivity. figure 8. flexibi-. lity .. 17.

(18) *. The necessity of a radical behavioural change both in the employees as in the company and its managers.. *. The necessity of an institutional change in society. And, as we will perceive from the empirical research's resulte, the Spanish HR manager is conscious about the need to intégrate the employees in the corporate project, as the key point in the new corporate designs. So the Spanish manager face the problem of how to implement this changing piocess. From the companies' point of view, the new institutional and organizative designs are based in the human being. Logistics, Total Quality Management, or Lean Management require, basically, a complete personnel integration, and a special attention to employees in the way they implement and develop their activity. Achieving, as a consequence, responsibility and Qexibility in the adapting processes. The human beings are the key in business processes, and this requirements have to be fiilfilled.. Thus, we consider, that the existing organizative designs, based in a taylorist work división, and a Maxweberist sociologic power sharing, which créate rigid structures, should be modifíed. We should pass to a new organizative design resting in the employees' valué system and in the great capacity of modern information technology to determine. 18.

(19) (WROCRAT1C DESIGN>-. ORGAIflZATTVE DYNAMICS. OrientaO» lo orpurfntív» «fracture. i. -. Orientatioa ' lo an opea cnvironmcnt tbraogkHR. Proct» dtsign scconüng to dtuaúans. Figure 9 business processes and their permanent change. In this point, we should introduce the role of the HR manager in the company. Therefore, we wül analyse first, "who" is the HR manager, as well as the role of the HR department in Spain, comparing them to those in the Germán, British and Slovack cultures.. 19.

(20) m . THE HR MANAGERS Di THE COMPANIES The HR manager in the Spanish company is a person dominantly in his fortíes or fifties. An 18% are older than fifty years, which expresses the given generatíonal change in Spanish companies in the last 4 years, as just a 9% are less than thirty years. This means that the HR manager in the Spanish company taces, supposedly, a fifteen years long professional career, as a 73% of the studied HR managers are between their thirties and fífties.. At the same time, the actual HR managers have dealt with their posituras during more than five years (47,5%), and, near a quarter of them have entered their poste in the last three to five years. Similarly, tbe Germán HR managers stand for a long time at their posts, while in the UK and the Slovak Republic the rotation level is much greater.. As we may observe in Figure 12, the HR manager is Spain has, overwhelmingly, a college degree (94,1%), a far larger figure than in Germany (83,5%), ÜK (73,5%) and the Slovak Republic (76%). This process have increased in the last years. At the same time, we perceive how the lawyers domínate among the Spanish HR managers (32% of tbem), with lower figures in the ÜK (2,4%), in the Slovak Republic. 20.

(21) • L E S S T H A N W Y E A R S Dat-SOYEARS DoLDER THAN SO YEARS. Figure 10 (10%), and in Germany (with a 14,4%). The lawyers' dominance in the HR área, has always been and still is the main feature in this activity, as this studies are still recommended by a (31,4%). On the other hand, the economist plays a minor role in Spain with just a 9,2%, against their crucial position in Germany (60,3%), as well as in the UK (36,8%) and in the Slovak Republic (32,5%). This situation derives from the lack of economic and business mentality in the HR área. 21.

(22) HR-MANAGEMENT POSITION: LENGTH OF TIME SPAIN. ___^^. 20,*%. 24,4%. 7,a». 47,5%. B L £ S S 1HAN 1 YEM D i - 3 YEAR3 • » £ VEARS O M O R E THAN S YEARS. Figure 11 within the Spanish finns, against other countries' cultures. Human Resources are not treated from the economic perspective but from the legal-administrative one.. The psychologists cover, as well, an important space in the HR manager profíle, with a 12,4%, signifícantly a larger figure than in other countries.. 22.

(23) UNIVERSITY DEGREE SPAIN. í «7.2!%. sovee a awcu BOCKMVU/ K T . CCLVUL. Figure 12 Thus, as a consequence, we may establish, that the HR managers' degree background sets the principies in that área in the Spanish company, and is narrowly related to the working framework.. Another signifícant question about the potentials oí HR managers is the one related with their piofessional career. As we may acknowledge in the Spanish company a 73,5% of the HR managers have developed their potential within the same HR department, and just a 26^5% of them come from other business functions. It could be said, that the so-called chimney effect - HR. 23.

(24) managers developed in theír own departments- dominates, more than in other cultures.. PRACTICAL EXPERIENCE FOR HR-MANAGEMENT ROLES SPAIN. START THE MANAGERICAL CAREER INSDE THE HR-RJNCHON 73.5%. Figure 13 Doubtlessly, Üás is a signifícant difference, in particular, with the UK and the Slovak Republic, where just a 46% of the HR managers, are feed within the HR department. More than half come from other business activities. In Germany, two thirds of the HR managers are developed professionally within the same HR departments and a third come from other activities.. 24.

(25) When the HR managers are asked about which career stage they have achieved, we observe how a third of them believe they have already. THE OVERALL CAREER SPAIN. IN OTHER FUNCTION 17%. 33,3*. 0REACHED THE CEIUNG IN Q A N INTERMEDIARY 3TEP IN THE THE PROFESIONAL CAREER PROFESIONAL CAREER •cunee « amoA eowMmw w T, BEL VML. Figure 14 reached their career ceiling, while two thirds of them consider themselves still in a developing stage of their professional career. Besides, it is widely extended (8396) among those HR managers the desire to continué in the Human Resource área, as their career path. Just a 17% of them would like to develop their potential in other business áreas or functions. According to these figures, we may observe how HR managers do not. 25.

(26) consider the exisíence of. managing skills they could use in other. business units or functíons. Which goes against the belief of other functional managers.. The low international business training and experience standards among HR managers in the different countries arise as a serious issue to be analysed. Human Resources, are probably the área with the lowest international development in their management, creating important problems in the companies'. development. Localism in the HR área. derives from the legal - orientation given to HR policies, together with an inward cultural visión more than orienting to a business and economic framework. The explained situation leads to a lack of international expansión of HR departments'. economic and social practices. Thus,. companies loóse very significant potentials.. We may appreciate how just a 16,1% of HR managers have any practical experience abroad. The Spanish situation in this ground is similar to the one in Germany, while a third of British and Slovak HR managers have acquired some international experience.. The HR managers' internationalisatíon déficit, in our opinión, arise as a review issue when discussing the managing development.. 26.

(27) PRACTICAL EXPERIENCE FOR HR-MANAGEMENT ROLES SPAIN. JOB ASSIGNMENT ABROAD. Figure 15 Before analysing the Spanish HR managers' valúes, we should outline how a 71% of them stand at their companies' Board of Directors. Doubtlessly, this is a surprising trend if we compare with the 15% of HR managers standing at the Germán Vorstands, while in the UK a 30%, and in the Slovak Republic a 19% stand at the board of directors. However, two constraints should be analysed to understand properly the HR Managers' real location within companies:. 27.

(28) First, Board of Directors is not the same as the Germán Vorstand, but more an inwards-oriented institution. POSIT1ON IN THE ORGANIZATIONAL HIERARCHY OF YOUR CURRENT EMPLOYER SPAIN. 70,8*. •BOATO OF DIRECTORS Ol£VEL2 QLEVEL3 D L E V B . 4. Figure 16. *. The breakthrough to top responsibility levéis have occurred in the last fast-changing five years. The reason lays in the downsizing trend, and a perceptiveness of the necessity to widen the HR importance in the business process management.. 28.

(29) In the present, from the valué profíle defining the Spanish HR managers we may outline three main valúes:. *. Bargaining skills. *. Communicational skills. * -,;-. Attachment to company These set valúes, maintain their overwhelming acceptance in the future, with a clear affinity to them by the HR managers in the following grounds:. *. Bargaining skills. *. Motivational skills. *. Communicational skills. Besides, in a future, another group of highly considered valúes, related to organisational and business issues, appear as relevant:. *. Strategic visión. *. Attachment to company. *. Delegation capacity. *. Flexibiiity. *. Global Vision. *. Risk assumption. 29.

(30) VALÚES PROFILE OF HR-HEAD SPAIN. BAROAIMNS 8WLUS; M0HVATI0NM.8N1ISÍ COMMUMCATONAL SOLLSÉ STHATEQIC VlStONt IDENT1HCATION WITH COMPANYEl DELEQATION CAMCITYF? FLBOBlUTYg GLOBAL VI SON g R18K A S S U M P T I O N E. RJIUREMSIONE? BCONOMC yENTALlTYE* 8PECtMJ8T IN LABOUR AfRMKESg OOOO ADMMSTRATOR. Moviurvl AUIORITY. •PRESENT BFUTURE. Figure 17 As we may appreciate, all these valúes conespond, basically, to the operative business way of thinking. The gap between the present and the fiíture set of valúes, is highly significant in some cases, which become a key concern to those HR managers. We find, as well, a discouraging set of valúes in the obtained results, corresponding to very low figures in:. *. Economic mentality. •. Mobüity. 30.

(31) There is a clear declining valué, which is the administrative role of HR managers. Administration is considerad not to be tbeir function, and at the same time, the labour specialist role start to loóse weight among them. Summarising, we appreciate a clear trend towards a greatei importance of the business management issues among HR managers, and a changing pattern léaving aside the traditional administrative-legal perspective.. IV. WHICH ROLE PLAYS THE HR-DEPARTMENT JN THE BUSINESS ORGANISATION? A 95% of the Spanish companies hold a HR department, showing similar figures as in the other researched countries. Thus, the need to research which role are playing those departments. We may observe the lack of great differences among the HR organizatíve structures in the four countries, as the four maintain highly centralised functions together with decentralised ones.. The most centralised ones would be the following:. *. HR planning. *. Reward systems 31.

(32) DECISIÓN MAKING IN HR-FUNCTION GRADE OF CENTRALISATION SPAIN. COMPENSATION&BENEFITS MANAGEMENT. DEVELOPMENT. HR-PLANNING. EMPLOYEE RELAT1ONS. RECRUITMENT. TRAINING. 100 80 80 40 20 0 20 40 80 80 100 DTOTAL OEseamMusEt) QMEOIUM •TOT/NL CENTRAUSED BCENTFWJSED. Figure 18 *. Management development. Decentralisation gets a greater weight in those áreas conceraing with:. *. Recruitment. *. Relationship with employees. 32.

(33) On the other hand, we fínd greater cultural differences in the situatíon of HR departments' decisión levéis. Generally, we could affirm that the United Kingdom reaches the greatest level of stiategic oriented decisions. DECISIÓN MAKING iN HR-FUNCTION IEVEL OT OECISIOM MAK1NQ 8PAIN. The. greatest. differences rest in the HR planning and issues. in those. concerning. with. HR-FLANMM3. management development policy.. RECRUTMENT. Noticeably,. TRNMNG. should. remark. country. like. we how. a. Germany. carry out administrative 94PLOYEE RELATKWS. functions rather than strategic ones in the personnel recruitment área. "SKTSS. We could affirm that. Figure 19. *. Training. *. Reward systems. *. Industrial relations. decisión levéis in:. 33.

(34) are strategically oriented at a 50%, in the four countries.. Equally, we have considered the functions covered until now by the HR departments in Spain. The HR heads take upon themselves the following basic functions:. *. Recruitment and selection. *. Training and personnel development. *. Personnel administration. Playing a minor role the following tasks:. *. HR planning. *. Consulting services. *. Workplace evaluations. *. Rewaid systems. Thus, we may appreciate how the traditional task of HR departments have been more administrative oriented than business oriented.. However, the HR management is conscious about the need of a mutative change in the role of HR departments. The traditional administrative and control-oriented centre should be neglected and there should. 34.

(35) be a change towards a consulting centre, helping to design corporate strategy, together wíth other departments. HR DEPARTMENT'S TASKS SPAIN. TRAIN1NQ ANO OEVOLPMENT-p: HRPLANNNQRBWAROING SYSTEMSRECRUTTMENT/SELECT1ON-::::::. CONSUJANCY SBMCES-t CONT1NOUS IMPROVEMENT JOB VALUATIONS JOB OESCRIPTK3N PERSONNEL AOMMSTBATOn TALENT DISCOVBtY ABSENTBSM AND ROTATION SOCIAL SERVICES TIME SCHEOUUNQ CONTROL OF TIME Ti. 100 QPRESENT • F U T U R E •ouve k 0/mnBOKjMnMttT. c. Figure 20 HR heads consider as their main ñinctions in the future, the following:. Training and development. 89,8%. HR planning. 85,6%. Reward systems. 75,7%. Recruitment and selection. 75,0%. 35.

(36) HR beads confer low future relevance, to the traditional functions in this área, as: *. Administration. *. Workplace descriptíon. Also, HR beads endow a lesser role in a future to the following functions: *. Discover talents. *. Deal with absenteeism and rotation. *. Social benefits. *. Controlling issues. The given clarifying trend towards corporate management áreas dropping the traditional one remains, doubtlessly, as HR heads' main future mission.. The basic problem is to discover whether the HR heads and their departments have already achieved enough capabilities and attitudes to deal with the explained developments.. 36.

(37) CAPABILITIES AND ATTRIBUTES OF YOUR HR STAFF SPAIN. ANTtCIPATES CHANOES- - : HB VISON OF F U T U R E - t v. COMPUTER LrrERA'TE. EXPEHIENCE KEY B U S I N E S 8 - f : : FOREING LANGtMOE CAMBIUTY-. UNE MANAGEM6NT EXPEniENCE"H INTERNATIONAL E X P E R I E N C E +. 0. 20. 40. 60. •PRESENT • FUTURE KKMZ : a OMOAffCIgWWM / W1.0B. M/VT. MB emt. unanutu » nmnn* imtwam. VM.. Figure 21. So HR heads believe that in a future, the required skñls and attitudes ín their departments' employees should be, dominantly, the following: Anticípate changes Future visión in HR managers Knowledge in many HR functions Line managers' training as a key function. 37.

(38) And the following know how appear with a secondary relevance. *. International experience. *. Knowledge specialisation in few functions. *. Benchmarking practices. The Spanish situation is similar to the one in the other researched countries, United Kingdom, Geimany and the Slovak Republic. When comparing the present and futuie profíles, we may deduce the huge changing requirements. This process supposes a mutative change. The great challenge rests in the way to implement this change process, one of the main targets in this research.. V. HR MANAGERS* CHANGE PROCESS IN THE SPANISH FIRMS The coming chapter will analyse the way the HR Head may follow to adapt himself to new management requirements in open and competitíve economies. Besides, we will consider how the HR Heads and their departments are affected by the change dynamics.. The HR manager in Spain thinks that the change process should be brought through:. 38.

(39) *. Much stronger tíes with the corporate strategy. *. 91,8%. Take part actively in company's business. *. 85,8%. Develop with a greater intensity Communications with other business áreas.. 82,2%. These trends confirm the orientation to a corporate managerism in human resource disposal, more than a mere administrative.. In a second place, but with significant figures, the HR manager considers he may assume his challenge through:. *. Improving the co-ordination with other business activities. 77,9%. *. A greater flexibility in HR function. 75,5%. *. A greater training capacity. 75,2%. ?. A change in corporate culture. 71,3%. The HR manager does not include among those important variables, their change within the organisational level, or the assumption of new functions.. 39.

(40) CHANGING PROCESS OF HR MANAGER'S PROFILE SPAIN. GETTING OEB>ER M V O U E D IN COBPOBUTE ITBATEar GREATER PARDC1PHT1ON IN BUMNESS ACTIVmEf QHEATEB COMMNIGATION VHTH. . OTHEH BUSWESÍ ÁREAS SETTER COOMXNMION VWIH OTHER . ADEAS OREATEB R E M B U T Y * Hfl RJNCTION-THROUGHTIMINMQ-. -. THHOUOH CORPORATE CULTURE CHAN6C CHANGWa THE MPORTAMCE LEVEU . WTTHW THE ORaAWZKTION 1E8IGMNQ THBRWOHCMQ OONTENT» ATTENONQ OTHER FUNCTI0N8- -. 100 8 0 8 0 4 0 2 0. 0. 20 40 80 80 100. D N E B A I N E V U I U E nUWffiLEWMtCE l i — i M m y i » BlWOKTUMTVMJJE. Figure 22 The HR manager does not include araong those important variables, their change within the organisational level, or the assumption of new functíons.. But, as we have seen, the challenge does not rest only on the HR heads, but also in the whole depaitment, as they look forward beconüng a service offering depaitment, and not an administrative one. The whole process could be sustained in four key aspects:. 40.

(41) HR DEPARTMENT'S CHANGING PROCESS SPAIN. OREATER PART1C1PAT1ON IN CORPORATC BOARDS A t U A H N S GREATER KSPONSAaUTY' GREATCR KNOWIE00E OF BUSWESS. ACTIVmES TEAMWORKTHROUQH SPECinc TTVUNIHOMORE NEGOT1AT1ON CAFMOTYFURTHCR OEntRTMENTS DECENTRAUZATION INTEGRATINQ GENERAHONAL CHANOS THROUOH A GENERAUST TRAIWNGROTATKtM IN OTHER DEflARTMENT 100. 8 0 8 0 4 0 2 0. 0. X. 4. 0. 8. 0. 8. 0. 100. QNBamvEVAUjE •UMISEVANCE B E. Figure 23 *. It should assume greater responsibilitíes. *. It should improve the knowledge about the business. 79,9%. áreas. 75,5%. It should intensify team working. 75,0. 41.

(42) On the contraiy, we fínd a number of activities and variables íhat are not identifíed as the engine of HR departments' changing processes, as:. *. Rotating through other departments. *. A more generalist training career. *. Integrating generational change. *. Decentralising the departments. Once again, we may appreciate clearly, the HR managers' state of mind, about their need to be integrated in the corporate's business, more than in their traditional functions.. This changing process is considered to be developed, from two main processes:. *. A training policy, derived from the clear perception of a need to improve the capabilities in HR departments' Staff, in order to assume in a future the business oriented managing skills .. *. Changes in corporate's organisation.. Generational change and the need to redefine the departments' scope do not appear among the explained variables. The focus is oriented. 42.

(43) towards the capability to achieve a great performance in open markets. This fact implies a new Corporate Culture, a visión need. That is way environment's knowledge is increasingly important, as well as, motivational and leadership theories. At the same time, instruments and tools loóse some importance.. MAIN DiFFICULTIES IN CHANGING PROCESS SPAIN. PERSONNEL FUGIDITIES -ACK OF CHANQING CONCKXJSNESSREStSTENCE IN MANAGEMENT LACK OF CHANQE PROJECT LACK OF LEADERSHIP LACK OF STAFFS TRA1NING SK1LL LACK OF MANAGEMENT SNLLLACK OF FUTURE W S » N DIFFlCUtTY TO RENEW Hfi" IABOUR RELATIONSENVIRONMENTAL DIFFICULTIES AOAPT TO NEW ACDVITIESHK3H C DtFFICULTY TO OBTA COMPANYM RESISTENCE IN BOATORK3H3 HEADOUARTERS100 80. SO. 40. 20. ONEQMTIVE VALUÉ D L O W RELeVANCE UEXCEJJENT. 20. 40. 60. 80. 100. VALUÉ EllMPORTANT VALUÉ A BHBHmM IT ''•XL WL. íígure 24. 43.

(44) Once inquired, how the HR managers think this change process should be implemented, we should study where those managers perceive the greatest difficulties are located in this move. The greatest ones are in:. *. Personnel's stiffness. *. The lack of a changing consciousness. *. Management resistance. However, we find another set of valúes not so much assessed, as lack of leadership, lack of a changing project, low capacity in the training department Le. HR managers do not see, neither, as great obstacles competitivity, business dimensión, resistance in the Board, environmental difficulties or industrial relations.. Therefore, it is surprising once studied the Spanish firms' actual situation, how the HR heads just define the given obstacles' profile, which should strengthen the success chances compared with their actual results. This hopefulness does not correspond with the actual parteras in the Spanish companies' changing processes.. 44.

(45) VL CONCLUSIONS We may affirm that eveiy company is defined by the three success factors:. *. First, the institutional field, which includes the valué systems that have to be managed.. *. The economic field, including business strategy, that correspond to the evaluation of environments and compames' strengths and weaknesses.. *. Organizative field, looking for adaptability to changing processes.. These factors carry out three new basic orientations in HR managers' corporate culture. *. First, we need human-oriented organisations, in order to enhance their integration and motivation, as a prior condition to a flexible and quick change process; thus reducing economic costs and time consumption.. 45.

(46) *. A clear customer and supplier driven orientation, reducing transactíon costs.. *. Finally, we need a clear orientation to the constant development of the institution.. So the proposal for a better HR management could be the following: *. Increasingly, the HR corporate manager has to come near the top corporate levéis, even being included and taking actívely part in them.. *. The functional and the corporate sphere should be clearly divided within the HR área.. *. HR management is becoming the key strategic tactor, both at the design of cultural changes, as in the strategic and organizative resolutions.. *. HR managers should be more business-aligned, an more separated from functions.. 46.

(47) *. The basic trend is towaids an increasing outsourdng orientation in HR functions, aiming economies of scale through the collaboration with others.. *. Differentíation remains more in HR corporate management, than in the management of HR functions.. In the coming years, management processes will increase their importance as the major role of HR managers. All the energies in HR management, particularly those related to leadership, should be oriented to institutional consolidation. This is the only reference offering external and internal confidence to companies within an open and comperitive context that is involved in huge uncertainties.. . REFERENCES BANCO DE ESPAÑA: "Central de Balances" different years DEUTSCHE BUNDESBANK: "Monatsberichte" different years GARCÍA ECHEVARRÍA, Santiago (1991): "Management de Recursos Humanos y Sistemas de Información" in Working Paper (Serie Azul) Nr. 172, Madrid GARCÍA ECHEVARRÍA, Santiago (1992): "El nuevo diseño empresarial español. Hacia una nueva Cultura y Estrategia Corporativa" in Working Paper (Serie Azul) Nr. 190, Madrid 47.

(48) GARCÍA ECHEVARRÍA, Santiago (1994): Introducción a la Economía de la Empresa, Madrid HÜCHTERMANN, Marión, LENSKE, Werner (1991): "Wettbewerbsfaktor Untemehmenskultur" in Beitráge zur Gesellschafis- und Bildungspolitik, Nr. 168, Colonia LATTMANN, Charles, GARCÍA ECHEVARRÍA, Santiago (1992): Management de los Recursos Humanos en la empresa, Madrid MARR, Rainer, GARCÍA ECHEVARRÍA, Santiago (1984): Política de personal en la empresa. Gestión de los Recursos Humanos. Madrid ORDOÑEZ ORDOÑEZ, Miguel (Eds.) (1995): La nueva gestión de los Recursos Humanos, Madrid The World Competitiveness Report - 1990. ed. World Economic Forum, 1992. VAL NÜÑEZ, M* Teresa del (1994): Cultura empresarial y estrategia de la empresa en España, Madrid. 48.

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