HR Challenges

The approach of the millennium has brought about new challenges for human resources departments and practitioners around the world. These new challenges raise questions about the nature HR practices and the role of HR professionals, and imply new approaches for the HR function in product and service delivery.

Organisations recognise the critical importance that human capital means for competitiveness, and ultimately survival in the modern era. No longer are leading edge products, cost effective processes, or in-demand services thought to be the key ingredient of success, but rather having and being able to keep the people who will come up with these ingredients time and time again.

This recognition has meant human resources management has become integral to strategic decision-making at the highest level in many leading organisations. But joining the major players at the organisation’s cardinal business table requires that the HR management function comes to grip with the key HR issues as well as key business issues facing their organisations.

David Ulrich, a renowned HR expert and author, has identified eight of these issues that are key if the HR function is to add measurable value, deliver business results, enact professionalism, and demonstrate new competencies. Briefly these challenges are:

1. Globalisation

HR management needs to create models and processes for attaining global agility, effectiveness, and competitiveness. HR professionals must master global operating skills and the HR function must build global capabilities for the organisation such as the ability to move talent, ideas, and information around the world.

2. Managing the Value Chain for Business Competitiveness

HR needs to refocus practices more on the value chain and less on activities within the firm. This is important because by shifting the focus from firm to value chain, all HR activities become defined according to customer criteria.

3. Profitability Through Cost and Growth

Revenue growth is a key component of the profitability equation. The main paths to growth include through leveraging customers, leveraging core competencies and mergers, acquisitions or joint ventures. Each of these has HR implications and requires co-operation between management and HR professionals to design and deliver new organisational practices.

4. Capability Focus

Managers and HR professionals should constantly seek the capabilities necessary for success. Whilst general management must identify and foster what capabilities they need to increase organisational competitiveness, HR professionals must frame what they do in terms of these capabilities at an organisational level.

5. Organisational Change

HR professionals need to help their organisations to change, define an organisational change model, disseminate that model throughout the organisation and sponsor its on-going application.

6. Technology

Managers and HR professionals need to be able to redefine work to maximise the value of technology in the organisation. This means making technology a viable and productive part of the work setting, and requires that HR professionals keep ahead on the information curve.

7. Attracting and Retaining Intellectual Capital

Business organisations of the future will compete aggressively for the best people, and the successful organisations will be the ones that are able to attract good people, use them effectively, develop them and retain their skills within the organisation.

8. Transforming the Organisation

Over the past decade, organisations have gone through one change initiative after another including downsizing, consolidations and restructurings. Unlike many of these turnaround efforts, transformation goes to the heart of the organisation changing the fundamental image of the business, as seen by customers and employers. HR has to play a leading role in organisational transformation.

Hope you all will surely share your inputs on this topic.



From India, Delhi
Hi Archna ..
Some food for thought..
The role of an HR is clearly shifting from a transactional to a strategic one..
Biggest Challenges according to me is Attract and Retain the Best of Talent Pool and enable each individual grow to become a change agent himself in the future ...
Needless to say , the world is converging to one huge consolidated organisation and there is an utter need to have all cross-cultural , cross -functional Skills to survive and flourish..
Jack of all Trades Master of None - Out
Jack of all Trades Master of Some - In
Lets ride this Change Wave ..

From India, Calcutta
Hey Dheeraj,
Thanks a lot for sharing an insight on this topic.
I agree with you that the waves are changing from transactional to strategic, but many companies does not involve HR is strategy designing.
MAny changes are required even now in most of the companies, even the top companies in India does not follow this.
Think about it.

From India, Delhi
hello archana,
good post and very informative one.
Yes, many organisations still are not finding HR is very vital one for the growth of their staff and ultimately to their organisations. It is unfortunate. But the change will take place undoubtedly.
One of the reason i find is that still they feel HR has come to replace the word 'Administration Department' - especially in the goverment set up. hence they find no reason to accept the new concept. But they forget that the Administation has dealt only with the papers and files of the people and NOT the people directly.
I am sure people like us can bring-in the changes steadily.
Atleast people working in private set up like you are lucky that they have HR and imagine the situation in the non-private sector.
senthil raj


From Costa Rica, San José
Hi Archna
well, you are very right saying that HR needs a good revamping of itself.
well, I agree in toto with you and wud also request you to read my article on "Articles" part on this site only. The caption is Future HR Managers in my view" where in I have given good insight into what and how do we need to be in this era where HR is very crucial function. Its no more a support function but a strategic partner of any business no matter how big it is.
Hope that reading will be appericiated by YOU

From Poland, Lodz
Thanks a lot Dino.
I read your article, it is relally amazing. I must say you have good writing skills with the knowledge of HR.
Keep it up buddy, I 'm really happy :D to have read your article.

From India, Delhi
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