Airline Industry Value Chain

Assignment 2:

Human Resource Implications of Technological Change

Submission Date:

5th May 2007

Table of Contents

I Introduction 2

1.1 Definition and Conceptual Framework for HRM Implications of Technological 2

1.2 Importance of HRM Implications of Technological Change to Managing People 3

II HRM Implications of Technological Change 3

2.1 Main Themes on the Topic 3

2.2 HRM Implications of Technological Change 4

Implications of Technological Change on Job Design and Job Analysis 4

Implications of Technological Change on Human Resource (or Employee Planning) 5

Implications of Technological Change on Organisation Design 6

Implications of Technological Change on Recruitment and Selection 6

Implications of Technological Change on Training and Education 7

Implications of Technological Change on Compensation and Appraisal 7

Implications of Technological Change on Organisational Culture 8

Implications of Technological Change on Labour- Management Relations 8

III Summary and Conclusion 9

I Introduction

1.1 Conceptual Framework for HRM Implications of Technological Change

Natalie Greenan (2003, p. 289) describes technological change as a series of changes affecting both factors of production and the way they are used and combined together. He further says that these changes are primarily qualitative. As far as the capital factor is concerned it involves replacing old equipment by new equipment, often incorporating more information technology than before. As far as the labour factor is concerned, it involves investing in new skills and competencies to meet new requirements. Consequently, as far as the use and combination of factors is concerned, it involves redefining the division of labour and the rules permitting effective co-ordination within the firm.

Implicit in the above statement, is that technological change spurs global, systemic and diffuse effects on the different aspects of a product- or service-rendering entity or business. Considering every organisation as a business providing a service or product, this piece of writing will make use of the Michael Porter's Value Chain Approach to have a frame of reference for the different aspects of an organisation. This framework shall offer a conceptual basis for zeroing in on the human resource aspects of an organisation, interaction between that aspect and the rest of the components of an organisation, and the implications of technological change of HRM and its relationship to the rest of the organisation.

Given our assumptions, any organisation consists of primary process (inbound logistics, production operations, outbound logistics, marketing and sales, services) and secondary processes (procurement, human resource management, technology and firm infrastructure). All these aspects of a 'healthy' organisation must 'fit' each other. By definition, technological change affects principally the primary processes and the secondary processes are redesigned to be in line with the rest of the system of the organisation.

This piece of writing shall focus on the adjustments in the management of human resources that have been prompted by technological change in organisations in the recent past and the future. In the next section, the paper first considers the importance of the human resource implications of technological change to managing people. The section thereafter states the main themes in the topic and the final chapter delves deeply into the each of the themes highlighted in the previous chapter.

1.2 Importance of HRM Implications of Technological Change to Managing

People

As technology determines how the inputs of production, including labour, are combined in order to produce outputs, when technology changes, the manner in which labour is combined with the other factors of production changes. Therefore, it is extremely important for an organization to understand the implications of technological change on the management of its human resources. Once the organisation is able to do so, the organisation is able to seek out, accept or reject new types of technology that may assist it to attain its business objectives.

II HRM Implications of Technological Change

2.1 Main Themes on the Topic

Stone (2002, p. 13), states that HRM involves the acquisition, development, reward and motivation, maintenance and departure of an organisation's human resources. He further states that it can be dissected into the activities stated in the diagram below:

Figure 1: Porter's Value Chain and Human Resource Management (HRM)

Human Resource Management

Job Analysis

Human Resource Planning or Employee Planning

Employee Recruitment

Employee Selection

Performance Appraisal

Human Resource Development

Compensations

Benefits or Rewards

Industrial Relations

Firm Infrastructure

Technological Development

Human Resource Management

Procurement

Inbound Logistics Production Operations Outbound Logistics Marketing & Sales Services

This