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The Role of HR in Creating Sustainable Organisations


With an ever-increasing emphasis on sustainable organisations, today management is focussing on HR in creating sustainable organisation. In the current economy, HR is actively participating as a strategic business partner rather than being only a support function (Loshali&Krishnan, 2013). Being an external HR consultant, this business report is an attempt to identify the role of HR in creating sustainable organisations. The main purpose of this report is to identify how first hospital CEO can make use of HR in regard to attaining sustainability. Here, different business situations are analysed with an aim to identify how first hospital CEO can improve its HRM operations, and the key features of building sustainable HR capability.

Critical Thinking Answers

Answer 1

With the help of case study analysis, it becomes evident that the CEO of the first hospital need to make significant changes. Hospital being operating with 400 people across different sites really needs a dedicated HR department. Though, the hospital is doing well in the present, but it may become difficult for its CEO and finance manager to manage all key HR functions in the future. The current model of HRM followed by the hospital is not so well-planned and this is the reason, it is also facing significant challenges like industrial disputation, high level of staff grievances, staff shortages, absenteeism and turnover.

All these challenges in turn lead towards decrease in the quality of care and even serious accidents involving patients and staffs. This would not help the hospital management to attain sustainability, which has become crucial nowadays for almost all firms operating in different sectors. The hospital management along with CEO really need to work hard in regard to improving its HRM operations. This could also be understood with the help of the Triple Bottom Line which could be summed up by the 3 P’s: people, planet, and profits.

Alhaddi (2015) describes that the idea behind the Triple Bottom Line is, if the management of hospital hires capable people and treat them well, then its employees will be more motivated to take better care of planet (while taking exceptional care of the customers), and if all this is planned well, it would lead towards higher profits. The concept of sustainability if applied here will help the hospital management to incorporate both social and environmental initiatives directing towards financial development (Alhaddi, 2015).

In accordance to Liebowitz (2010) a growing body of evidence suggest that if management of a firm wants their employees to make a significant discretionary effort to assist protecting the environment, then management need to put their employees first and develop a people first or employer-of-choice culture. Same is the case with first hospital, to improve its HRM operations; first of all it needs to develop a people-first culture. This is possible only with the utmost support of management and hospital owners.

Mazur (2014) on the other hand depict that today employees are an essential source of competitive advantage, and it need to be realized to attain assured success. Hospital can also become more successful and able to deal with its current challenges with the help of sustainability focus and sustainability culture. Regarding this, the Human Resource Department of a company plays a crucial role, so initially it is vital for the CEO to develop a separate HR department working with a specific HR strategy aligned with its business strategy, mission and vision.

Burma (2014) affirms the views of Mazur (2014) by describing that the Human Resource Department of a firm has the capability to play an important role in the development of its sustainability culture. The HR department is probably the only department that is well-trained to alter the outlooks and behaviours of the company executives, managers, and employees, by making changes in their different human resource systems (Burma, 2014). In most of the successful companies, HR department plays an important role in maintaining its culture. It is because HR professionals have the skills and knowledge needed to take a firm’s mission, vision, and core values, and strengthen a strong, values-based organisational culture with the help of various human resource systems (Ehnert et. al., 2013).

The first hospital CEO should also make use of this kind of approach to become able to develop a Total Quality Culture. Appointing modern HR executives will help the CEO as he will be able to make use of strategic HR, Human Capital Management approach etc. to effectively implement the changes required to develop sustainability culture (Ehnert et. al., 2013). The hospital management really need to make use of comprehensive HR approach and make use of separate Human Resource Systems rather than being allocating these tasks to people working in other departments like finance.

A separate HR department can make use of different HR systems such as recruiting, employee selection, new employees’ orientation, training & development, performance management, compensation, empowerment, job security, succession planning, mentoring, innovation, collaboration etc., (Schroeder, 2012). With the use of all these HR components, and a strategic HR approach the hospital will become able to manage its HR operations in a much effective manner. Till now the company HR operations were managed by its owners and finance peoples, who are not able to make use of a strategic HR approach and make changes when required.

Middle and supervisory management is trying hard but facing issues due to inconsistent application of HR policies and practices. A separate HR department will facilitate hospital’s middle and supervisory management in implementing all HR policies and practices in a consistent way and on time. This kind of approach will help hospital to deal with industrial disputation, high level of staff grievances, absenteeism and other challenges (Savitz, 2013). HR executives appointed will help in motivating employees as well as engaging them, but this is possible only with the continuous support of senior management.

Answer 2

With an analysis of second hospital situation it becomes evident that there are some key factors which play important role in attaining sustainable HR capability. Machado (2015) describes that the attainment of sustainable HR capability for an organisation is not possible without senior management support and commitment in this regard. Success of the second hospital case depicted is all because of the passion of its CEO towards HR and its impact on staff engagement and organisational commitment.

The hospital is able to make a positive effect on the quality of its patient care, and it has become possible only because of its separate and distinctive HR function. The hospital has developed an HR function that facilitate in creating sustainable management practices, process and policies. Its dedicated HR manager and teams are also significant in regard to developing sustainable HR capability (Ehnert et. al., 2013). With the help of analysing this case, it can be said that there are some critical success factors or key features of building a sustainable HR capability.

In the words of Kramar(2014),HR of a firm can help it in successfully implementing sustainable business practices. Though, nowadays most of the firms make a pledge towards sustainability, but find it problematic to implement, measure, and incorporate it. It is because; companies need to adopt some key features from a people viewpoint to drive sustainable HR capability, which are as follows:

Development of a sustainable vision and mission:

To develop sustainable HR capability, it is vital for an organisation to develop a sustainable vision and mission. The company mission and vision will describe its commitment towards sustainable business practices. Subsequently, it needs to be aligned with employee behaviours by bringing in all employee perspective. Then, the company need to communicate it throughout its different organisation levels (Kazlauskait&Bu?i?nien, 2008).  In this way, it is possible for a firm to make its employees or human resources committed towards attaining company’s sustainable mission and vision.

Building an Aligned Leadership Pipeline:

Next, key feature of developing sustainable HR capability is to build an aligned leadership pipeline. It is because, aligning leadership with sustainability agenda is crucial in this regard. Company leaders are the one who can create related strategy and define their sustainability schema. Leaders are the actual role models for all staff, so aligning leadership is important. Concerning this the company HR plays a significant role as they can make different forums and ways for appropriate flow of information needed to bring different leaders together (Langwell&Heaton, 2016).Dedicated HR staff will find it really easy to build and implement an aligned leadership pipeline directing the company towards developing sustainable HR capability as done by the second hospital given in the case.

Setting up a suitable Organisation Structure and Governance Mechanisms:

To drive sustainability it is essential for organisations to make use of appropriate structural changes able to help in creating strong governance and management mechanisms. With the help of these mechanisms, the company management along with HR managers will become able to establish appropriate accountability and power in between available resources. This in turn will help the company to drive the sustainability goals and track its performance from time-to-time (Khandekar&Sharma, 2005). The success of second hospital is all because of its formal structure and governance mechanisms, facilitating its HR staff to affix formal accountability of each employee and subsequently track and measure execution of sustainable practices.

Developing key HR Capabilities to attain Sustainability and form Sustainable HR Systems and Procedures:

This is true that HR plays a crucial role in driving sustainable business practices at all organisation levels, and in creating sustainable HR systems and procedures, but most of the HR professionals working lack the appropriate knowledge regarding sustainability. Still, most of the HR professionals don’t know how sustainability impact business and how they can conduct organisational change (Ehnert et. al., 2013). This in turn, lead HR professional towards failure to implement changes on time and reap the benefits of sustainability. Due to this it is believed that today all HR professionals need to develop all functional capabilities to form sustainable HR systems and processes. To develop sustainable HR capabilities, HR professionals of companies need to understand sustainability in regard to the business, and develop abilities required to drive speedy organisational changes (Saha et. al., 2016).

Potential to Engage and Motivate Employees and effectively aligned them with the Sustainability Goals:

In addition to leadership, today companies can also develop sustainable HR capabilities by attracting and retaining the correct talent. Selection of appropriate talent is crucial to direct them towards company’s sustainable goals and practices. Concerning this, the company HR functions play an important role. Recruitment, selection, training and development etc., functions will facilitate a firm to align its employees at all levels and improve their level of engagement and motivation. Increased level of engagement and motivation will lead towards aligning employees with company’s sustainability goals on continuous basis (Waiganjo et. al., 2012).

Creating an Agile organisation:

The last key feature of building a sustainable HR capability is creating an agile organisation. An agile organisation will be always able to learn and adapt to changes triggered by its internal as well as external environment. Continuous learning and adaptability to change will lead towards sustainable business practices (Kramar, 2014).Concerning this, the company HR managers play a crucial role as they need to create effective mechanisms leading employee towards continuous learning and effective change management. This in turn will direct them towards building sustainable HR capabilities needed to attain assured success in the present competitive business environment.

Conclusion

With the help of analysing two hospital cases given, it can be concluded that a firm’s HR plays a significant role in creating sustainable organisation. Without a separate HR department or team, a firm cannot attain its set sustainable business goals and targets. Same is the case with first hospital as it confronted number of challenges due to the lack of separate HR department, which in turn directed its CEO towards inconsistent application of its HR policies and processes.

On the other hand, the second hospital CEO adopted a committed HR function to make a positive impact on staff and the quality of patient care. This HRM model followed facilitated the hospital to develop a strategic HR capability congruent with its sustainability goals and programs. On the basis of these cases, it is clear that HR plays a very important role in helping first hospital CEO to develop sustainable HR capabilities and attain assured success.

References

Alhaddi, H. (2015). Triple Bottom Line and Sustainability: A Literature Review.Business and Management Studies, vol. 1, no. 2, pp. 6-10.

Burma, Z.A. (2014). Human Resource Management and Its Importance for Today’s Organizations.International Journal of Education and Social Science, vol. 1, no. 2, pp.85-94.

Ehnert, I. et. al. (2013)Sustainability and Human Resource Management: Developing Sustainable Business Organizations. Germany: Springer Science & Business Media.

Kazlauskait, R. &Bu?i?nien, I. (2008).The Role of Human Resources and Their Management in the Establishment ofSustainable Competitive Advantage, Engineering Economics, no. 5, pp. 78-84.

Khandekar, A. &Sharma, A. (2005). Managing human resource capabilities for sustainable competitive advantage: An empirical analysis from Indian global organisations. Education + Training, vol. 47, no.8/9, pp.628 – 639.

Kramar, R. (2014). Beyond strategic human resource management: issustainable human resource management the next approach? The International Journal of Human Resource Management, vol. 25, no. 8, pp. 1069-1089.

Langwell, C. &Heaton, D. (2016).Using human resource activities to implement sustainability in SMEs.Journal of Small Business and Enterprise Development, vol. 23, no. 3, pp. 652 – 670.

Liebowitz, J. (2010).The Role of HR in Achieving a Sustainability Culture.Journal of Sustainable Development, vol. 3, no. 4, pp. 50-57.

Loshali, S. &Krishnan, V.R. (2013).  Strategic Human Resource Management and Firm Performance: Mediating Role of Transformational Leadership. Journal of Strategic Human Resource Management, vol.3, no. 1, pp. 1-11.

Machado, C. (2015). International Human Resources Management: Challenges and Changes. Germany: Springer.

Mazur, B. (2014). Sustainable Human Resource Managementin theory and practice. Economics and Management, vol. 1, pp. 158-170.

Saha, N. et. al. (2016).The impact of SHRM on sustainableorganizational learning and performancedevelopment.International Journal of Organizational Leadership, vol. 5,  pp. 63-75.

 

 

Savitz, A. (2013). Talent, Transformation, and the Triple Bottom Line: How Companies Can Leverage Human Resources to Achieve Sustainable Growth. USA: John Wiley & Sons.

Schroeder, H. (2012). The Importance of Human Resource Management in Strategic Sustainability: An Art and Science Perspective.Journal of Environmental Sustainability, vol. 2, no. 2, pp. 75-82.

Waiganjo, E.W. et. al. (2012) Relationship between Strategic Human Resource Management and FirmPerformance of Kenya’s Corporate Organizations.International Journal of Humanities and Social Science, vol. 2, no. 10, pp. 62-70.