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Changes In The World Of Work

The competitive environment is a major driver of change in the world of work:

The pressures on organisations to add value, achieve sustained competitive advantage, and respond and adapt quickly and flexibly to new challenges and opportunities are relentless. The responses to these pressures have taken many forms, including new types of organisation, lean, delayered, flexible, process- or project-based, increasing reliance on information technology, and an emphasis on continuous improvement in terms of performance, quality and customer service. The quality of the human or intellectual capital possessed by organisations is seen generally as the key factor in differentiating them from their rivals and achieving superior results. The focus is on the development of business strategies to achieve longer-term goals, and the part played by human resource strategies in general, and reward strategies in particular, in supporting their achievement is now well recognised. 

Clearly some organisations can survive on fairly traditional hierarchical structures to deliver standardised ranges of products and service, but increasingly customer orientation, product differentiation and service support require new forms of organisation. This is requiring no more than ‘horses for courses’ but it does draw attention to the fact that there is no guarantee that today’s organisations will exist indefinitely in their present form, or indeed exist at all. Therefore, there is a case for organisational strategists to recognise drivers for change and for managers to diagnose and be able to act upon the implications of these drivers, because organisational survival may depend on it. This impacts on approaches to managing people and the demands made on people managers, whether they are line managers or HR professionals. It is the context within which people are managed that is changing and HR managers have had to reposition themselves ‘in the ever-changing environment of global competition, new technology, and new methods of working and organising work’ (Armstrong, 2000). Private sector mantras are sustainable competitive advantage, added value, core competencies and strategic capability, while in the public sector the driving force has been ‘best value’ and from 2010 cuts in public spending.

Organisational Transience, Employability And The Transactional Psychological Contract

Organisational fluidity and transience, the ‘here today gone tomorrow’ perspective, has impacted on employees’ feelings of job security. While it may still be statistically possible to demonstrate that in many cases jobs are relatively secure, the expression of organisational and environmental uncertainty, together with the managerially projected imperative of adaptation and change, together with the global recession of 2009, have impacted upon employee perceptions of job permanence. It has also impacted upon the mutuality of obligation between employer and employee with regard to traditional career patterns. The end of the job for life may have been subject to hyperbole, but career patterns are different and twenty-first-century workers may need to engage in continuous development and the refurbishing of skills in order to maintain employability. This tends to promote a loyalty to self rather than intensifying loyalty to the organisation. Worker loyalty may therefore have to be purchased by the employer through the currency of self-development opportunities. Promoting self-development is not just about offering training courses but encompasses lateral career moves, development appraisal and employer responsiveness to worker employability needs. These ideas have links to the concept of the ‘war for talent’ where employers compete with each other to recruit and retain valuable employees. This competition involves offering not only appropriate financial rewards but also non-financial rewards. Armstrong and Brown (2001) contend that managers should not underestimate the significance of pay as a means of attracting, retaining and providing tangible rewards to people, because it is essential to get this right since much damage can be done if it is wrong. But as a means of generating long-term commitment and motivation they argue that pay has to be regarded as only part of a whole and that ‘it is the non-financial rewards that will ultimately make the difference’. For Armstrong and Brown non-financial rewards include ‘recognition, scope to achieve and exercise responsibility, opportunities for growth and development, the intrinsic motivation provided by the work itself and the quality of working life provideed by the organisation’. These ideas are explored further in the reward chapters.

This refocusing of the employer−employee relationship can create the transactional psychological contract, replacing a relational psychological contract, whereby both parties sustain the employment relationship all the time there is ‘something in it for them’; it is self-centred rather than familial.

Customer Aspirations And Power

Although phrases like ‘the customer is king’ and ‘delighting our customers’ can be accused of being trite, there is little doubt that, among other things, organisations have had to become more customer-focused in order to survive and prosper in competitive environments. Excellence in customer service has always been a differentiating factor, but perhaps what is different now is that customers have had their expectations fuelled and are encouraged to feel empowered to demand quality products and good service. Customers are also more inclined to exercise their power through either the withdrawal of custom or the pursuit of compensation or restitution. Philpott (2001) sums up this customer power: ‘intense competition in global and domestic markets forces businesses to keep labour costs in check and/or raise their game in terms of product quality, because empowered consumers want ever-better goods at ever-lower prices.’ This rise in customer aspirations is not only a private sector phenomenon, because citizen consumers of public services have also been encouraged, principally through public policy, to perceive themselves as fully fledged customers. It is not for this section to debate the legitimacy of the customer-driven organisation, nor to say how it should be achieved, but merely to draw attention to an issue which has implications for the world of work. Customer aspirations and power are influencing the way organisations are structured and managed and have significant implications for workers who have to contend with the increased emphasis on satisfying customer needs through being more responsive and more flexible, and providing emotional labour − ‘the management of emotions and provision of behavioural displays associated with feelings in interactions with customers/clients’ (Legge, 2005).

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