Employee-Company Cooperation in a Changing - Term Paper Example

Employee-Company Cooperation in a Changing Employment Environment 2006 Introduction The job environment is changing with the transformation of global economic output and employment trends. Globalization and outsourcing have altered the job scenario in both developed and developing countries as more jobs, particularly of the routine types, migrate from the developed to the developing world. As a result, the requirements from jobs have also changed, with greater interaction with clients and colleagues across regions, working across different time zones and with people of different cultures and the changing organization structures. Companies in the developed world are compelled by market forces to outsource jobs to lower costs while employees need to modify their skill set to adjust to the new employment scenario. There is a trend towards flexible employment contracts, putting more stress on employees to retain jobs and advance in careers in a sustained manner. This paper will discuss the changes in job patterns as well as the requirement of skill set development by professionals, in the particular context of the United Kingdom and Pakistan, representative of a developed and a developing market respectively. Changing pattern of employment In the United Kingdom, many Information Technology (IT) jobs are being outsourced to low cost centers like India. This has resulted in some job losses in the UK but has also led to an increase in jobs of managing outsourced IT jobs. A Gartner study has found from a survey of 3,200 companies that nearly 76 percent of the organizations face lack of IT skilled employees (Oates, 2004). It is expected that job opportunities for IT in the UK will grow from 1.5 percent per annum to 2.2 percent per annum for the next 10 years. In numbers, the UK will need about 156,000 to 179,000 IT workers every year. However, it has also been found that the UK is facing a shortage of IT staff. Thus, IT offshoring has resulted in a move of IT jobs out of the UK but it has at the same time increased managerial jobs. Price Waterhouse Coopers estimated that the graduate vacancies in the fields of retail, teaching, healthcare, marketing and advertising, civil service, media and entertainment, IT, hospitality and uniformed services in the UK have increased by 15.5 percent since 2003. Thus, there are increasing opportunities for people who are highly educated and skilled. In Pakistan, a developing country, the job scenario is different. As a newly industrializing country, the Pakistan economy has relatively less organized employment. The few companies that are at the forefront of technological development are reaping the benefits from outsourcing activities. Hence, both the employees and the companies benefit if employees increase their IT skill set that will encourage growth in company revenues as well as employee salaries. Shifts in job environment Hirsh and Jackson (n.d) details the ways that the job environment is changing, particularly in the United Kingdom and how the employees need to realign their goals and objectives accordingly. Drawing on the representations from 150 participants from 65 companies at a seminar, the report states that the company-employee relationship has become a “psychological contract” by which employees need to identify with the business goals of the company, become flexible in the job portfolio and willing to retrain oneself and even leave if the company does not require one’s services any longer. In the process, employees need to continuously develop their skills to sustain employment while they have the choice of alternate careers and job-life balance, be financially stable and processes that provide them equal opportunity to advance in their career. The well-defined “career path” of the earlier generation no longer exists and organizations may frequently switch from the demand for different types of technical abilities and generalists. Managers may have functional expertise but also have diversified knowledge. For example, a technical manager is expected to have knowledge about finance and vice versa. With technological change and transformation of business environment, new skill requirements are continuously emerging. Some of these new skills may be a continuation from a previous activity but may also require dramatic changes in requirements. For example, when computers were introduced in all types of jobs – from engineering to secretarial – in the 1990s, all employees had to acquire software skills. Employment issues of companies Career management has grown critical for employees and employers such that both can benefit. In times of a changing business environment, where downsizing, cost reductions, performance related incentives and employment sustainability are crucial, employees have to be constantly aware of the changes. However, companies too need to take up measures that will enable the employees to realign their goals and capabilities with the business need of the hour. Left to themselves, employees may be prone to find themselves misfit in the changing atmosphere, resulting in low self-esteem, frustration and stress, which in turn affect their work output harming the companies’ business performance. Nicholson (cited in Career Management Guide) lists the career management options available to companies. These are teamwork, competency development, performance-linked payments, contract regarding flexibility in work profiles and employability in new roles and self-management of job roles. Career Issues for Employees As we discussed earlier, education is growing the most crucial issue for job opportunities, career sustenance and advancement. Organized employment in all countries is biased towards professionals rather than those who have secondary education (Career Management Guide). In an earlier generation, education preceded employment and people who were in employment were not in need for further education. Nowadays, in contrast, education and employment are simultaneous activities throughout the career. That is why universities provide practical work experience avenues to students while they are on their professional courses. Also, there are a huge number of mid-career courses available that allow employed people to acquire new skills. Career management as a teamwork between employers and employees As companies grow more cost conscious, employees should realize that the employees do not necessarily depend on them. There is a huge source of external works and companies are increasingly contracting out work to freelancers or limited-period employees. Companies are increasingly realizing that workers with diverse experience can add value to a process by a greater extent than those who work in single enterprises. Hence, workers who have gained experience by working in the same organization may find themselves considered redundant despite their long years with the company. Besides, technical expertise that employees acquire is fast getting obsolete with the giant strides that global technology is making. Also, technology may even replace some job profiles like data handling, payroll processing, etc. Employees who were earlier engaged in these profiles need to retrain themselves in other expertise areas to retain their jobs. Companies are changing gear from offering permanent jobs to projects, tasks and short-term contracts. It is not necessarily a win-lose situation where the companies gain by reducing costs of employment by hiring short-term employees instead of permanent ones. On the other hand, workers who lose their jobs in one organization may as well find their skills valued in another. In contrast to the earlier system of rewarding good performance long tenure and higher salaries, the present system warrants that exemplary performance is rewarded by cash bonus. For project contracts, a good performance increases the chance of higher value being attached to the next contract (Career Management Guide). It is no longer the situation that employees can retain their jobs by playing safe in their assigned roles. Instead, risk-taking is rewarded as it has the potential of earning more revenue for the company than risk-averse business decisions. Of course, risk taking does not warrant rash decisions but a prudent one based on the observed trends and patterns in business environment. Above everything else, effective career management requires understanding the organization and its business parameters. In a global business environment where outsourcing of activities has become the norm, individuals need to acquire supplier relationship management skills so that the best of the organization can be achieved. Managers need to understand the strengths and weaknesses of this business strategy and develop new personal strengths and systems to realign themselves. The organizational structure may be 1) functional within the framework of a single organization where only technical competencies are required, 2) divisional in a single firm where the employees work across divisions hence require technical and commercial competencies, 3) matrix, where individuals work in the same firm but across projects, hence require technical, commercial and interpersonal competencies, 4) network, where individuals work within the firm as well as with other firms, where technical, commercial and collaborative competencies are required, 5) Cellular, where independent professionals perform various roles, requiring technical, commercial, collaborative and self-governance competencies (Allred, Snow and Mills, cited in Career Management Guide). Career objectives and decisions Career objectives and decisions ultimately depend on personal values, orientation and lifestyle decisions. Some people may not like to report to juniors while others may get tired of a traveling salesman’s job. These are essentially personal decisions that employees have to decide by themselves. However, in career management principles, some career anchors are considered on which career choices hinge. Ed Schien interviewed managers to arrive at a set of career anchors (cited in Career Management Guide). Schein listed these career anchors as 1) autonomy/ independence – which means that individuals want to work in roles that give independence, 2) security/ stability – individuals are concerned with long term job security and financial stability, 4) technical/ functional competency – individuals are passionate about the job itself, 5) general managerial competency – individuals are good at interpersonal relationships, 6) entrepreneurial creativity- individuals are able to create new products and services, 7) service to a cause – always ready to help others, 8) challenge – individuals are prone to risk-taking behavior and 9) lifestyle – want to maintain a work-life balance. Along with the career anchors, individuals are also concerned with career success cycle, which should be incorporated in the career management activity. Individuals are motivated to take risks and challenges if superiors give a helping hand and support to get through failure if they come about. Success in careers will come about if goals are realistic, maximum effort is exerted, superiors support the effort and suitably reward when successful. The risk-taking aptitude and capability towards the effort differ between individuals and the stage of career. Skill development Skill development of employees depends on both the organization and the individuals. The organization, particularly the Human Resource department, needs to assess the skills and competencies of the employees on a regular basis. In particular, more companies are taking succession planning seriously. It is no longer the case that the next in line will necessarily take over the mantle of succession. But someone from lower the line may be found to be more capable as a successor. Meticulous succession planning is therefore necessary on a continuous basis. At the same time, employees should be proactive in their career management. They should continuously assess their skill set in relation to the requirement of the organization and the market, understand current and future roles in the organizations and their access to the job market. They should not only develop their skills in a variety of areas but also chalk out an action plan if forced to leave the organization. Not only should the employee be open to acquisition of new knowledge, he should undertake training courses to improve his skills (Hirsh & Jackson). Conclusion Thus, the job environment the world over has changed over a generation. A secure, stable job in the same profile is increasingly growing extinct. Instead, employees need to constantly assess the job market, the organization requirements and their competencies. However, employees and employers need not take up a confrontationist approach in the labor market. Instead, employees should realize that globalization and outsourcing have thrown up more opportunities in contracts rather than contracting employment opportunities. An attitude of teamwork between companies and employees will result in a win-win situation for all. Works Cited Oates, John, IT Skills Shortage Threatens Humanity, The Register, http://www.theregister.co.uk/2004/11/01/skills_shortage/ Price Waterhouse Coopers, The Graduate Job Market, http://www.pwc.com/uk/eng/car inexp/graduate/improving-becoming-job.html Hirsh, W and Jackson C, Careers in Organizations: Issues for the Future, IES Report 287, http://www.employment-studies.co.uk/summary/summary.php?id=287 Career Management Guide, http://www.pao.gov.ab.ca/learning/careermgmt/why-career management.pdf Read More