Challenges of Modern HRM

Challenges of Modern HRMThe rapidly transforming business landscape means that there are currently many human resource management challenges that will continue to evolve for years to come.

HR managers are facing many challenges these days.

The field of HR management is undergoing transition because organizations themselves are changing. HR managers who encounter these challenges use their leadership skills and expertise to avert issues that might arise from these challenges.

Human resource experts have identified a few challenging issues of HR department:

Changing the mix of the workforce.

One of the most important challenges currently facing HR managers is adapting to people who are different.

The term we use for describing this challenge is workforce diversity. Workforce diversity means that organizations are becoming a more heterogeneous mix of people in terms of gender, age, race, ethnicity, and gender orientation.

Contemporary workforces have a diverse background. Women’s participation in the job market is increasing significantly.

For example, women, long-confined to low paying temporary jobs in Japan, are moving into managerial positions. A growing number of women seeking employment are likely to affect many aspects of HRM, including how a company recruits workers, work conditions, and employee relations.

The increased prevalence of single-parent households and dual-career couples puts tremendous pressure on women and men to balance their work, family, and personal responsibility.

Women are entering in a wide range of occupations such as legal, medical, defense, and business. Gender-role boundaries are weakening. Older people are predicted to be a larger percentage of the population.

Older employees may be less flexible than younger workers and motivated by factors other than money.

Among the major changes in the mix of personnel entering the workforce are increased numbers of minority entering occupations requiring greater skills, increasing levels of formal education for the entire workforce, more female employees, more married female employees, and more working mothers.

A diversified workforce is also an opportunity for an organization. Many companies now realize the advantages of a diverse workplace.

As more and more companies are going global in their market expansions either physically or virtually (for example, e- commerce-related companies), there is a necessity to employ diverse talents to understand the various niches of the market.

An HR manager must be able to organize the pool of diverse talents strategically for the organization.

He/she must consider how a diverse workforce can enable the company to attain new markets and other organizational goals to harness the full potential of workplace diversity.

Changing Values of workforce

New generation workforces are more educated, and they prefer challenging and difficult jobs. New research suggests that employees tend to hold inflated and unrealistic expectations about work (Wanous, 1998).

High expectations can produce anger, frustration, disappointment, and dissatisfaction if work experiences do not live up to values and expectations.

Changing Demands of Employees

The demand for new employees is different from that of their predecessors.

Contemporary employees are not only happy with the money; they demand more freedom and autonomy in the workplace. They are more concerned about intrinsic motivational factors such as challenging jobs, recognition, and appreciation.

They want more time for leisure, recreation, and self-development. They would like to balance work life and family life. The comment made by Greenhaus (2009) in this regard is noteworthy.

He said, “Attaining high-quality job performance on challenging autonomous projects may be more important to many employees than receiving a promotion.”

Family-responsive organizations will increasingly provide a more flexible work schedule, part-time employment, opportunities for job sharing, and child care arrangements to retain employees who are experiencing extensive work-family conflict.

Changing Demands of Environment.

The working environment is becoming more unstable, turbulent, and dynamic.

The modern working environment is characterized by globalization, increased competition, government legislation, and technological innovations. New jobs are being created, and new jobs require more education and skills.

For example, it has been observed that automation and JIT manufacturing mean that even manufacturing jobs require more reading, mathematics, and communication skills than before.

Thus, it is clear that there is a growing emphasis on knowledge workers and, therefore, on human capital. Human capital refers to the knowledge, education, training, skills, and expertise of a firm’s employees.

Introduction of New Technology

New technology may lead to retraining or need to recruit workers with specialist skills. For example, many former typists have become computer operators with the introduction of computer systems for storage, retrieval, and presentation of information.

Telecommuting and remote reporting relationships are becoming the norm rather than an anomaly. Flexible work schedules are ways to improve productivity for some employees.

Competition from other firms for workers may affect the supply of labor available to a business. If competitors offer high wages to workers with specialist skills, then a business may have to raise its wage levels to recruit the staff it needs.

Government legislation on minimum wage, working hours, and equal opportunities have affected the wage costs of businesses and their recruitment and selection procedures.

Changing Market

Changes in the purchasing pattern of consumers may affect the demand for labor.

Changes in the economy can also affect human resource planning. In a recession, a business is likely to reduce its workforce as demand for its products falls.

Changing Goals of Business

The goal of business can affect the demand for labor. If a chemical company, for example, decided that the most effective way to increase profits was to become more market-oriented, this is likely to change the personnel the business needs.

There would be a need for employees with marketing research skills or training on how to promote products.


It is the practice of hiring another firm to complete work that is important and must be done efficiently. Outsourcing refers to companies giving work to independent contractors outside the company rather than in-house employees.

Outsourcing is a major part of HRM’s role in a company, as many companies choose to hire freelance workers to complete additional tasks rather than taking on salaried employees in-house.

When outsourcing, HR managers do not need to consider overheads like taxes, medical insurance, working equipment cost, or benefits, as the freelancers themselves meet these.


HR managers must create a workplace free from any kind of discrimination.

Many countries have laws that make various forms of discrimination in the workplace illegal. Hence, HR managers have to perform their activities in a way that follows both legal and business standards.

Since more employees are aware of their rights, a modern HR department may need to handle a potential increase in discrimination complaints.

Conflict Resolution

Interpersonal conflict between coworkers, as well as a disagreement between employees and supervisors, may happen for many reasons.

It is common for HR managers to investigate complaints of verbal and physical harassment, and they must need to resolve conflicts before they become serious or harmful.

Change Management

Change management represents a particular challenge for HRM. An intensified focus on training may be needed to develop added competencies to deal with change management.

The role of the HR manager must parallel the needs of the changing organization.

Successful organizations are becoming more adaptable, resilient, quick to change directions, and customer-centered.

Within this.environment, the HR professional must leam how to manage effectively through planning, organizing, leading, and controlling the human resource, and be knowledgeable of emerging trends in training and employee development.

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