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Now that you have watched the mini lecture, you can learn more in the Essential reading for this topic.

Pilbeam, S. and M. Corbridge People resourcing and talent planning: HRM in practice. (Harlow: Pearson, 2010) 4th edition. Chapter 1 People resourcing: the changing world of work and contemporary human resource management.

You’ll notice that you read Chapter 1 of Pilbeam and Corbridge back in Topic 1, but it’s worth revisiting the section on changes in the world of work again as we look at this in more depth in this topic.

Remember that all the Essential reading for this programme is provided for you. Click ‘next’ to go to the next page and start reading.



Stephen Pilbeam and Marjorie Corbridge, People resourcing and talent planning: HRM in practice (Pearson, 2010; 4th edition)


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. (Armstrong and Brown, 2001)

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.

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.

The war for talent and the new paternalism:-

Where shortage labour markets exist they confer power to workers, as sellers of their labour, and enable a greater degree of choice to be exercised over whom to work for and on what terms. This is one element of the war for talent − employers having to compete with each other to secure their human resource needs. The war for talent goes beyond this, as the name suggests, and it is argued that in order to survive in competitive product and service markets employers need to attract and retain the most talented workers, even in difficult macroeconomic conditions. It is through securing the expertise, creativity and innovation of talented people that the organisation will prosper. In service-based and knowledge economies employees are not only the major operating cost but also the source of competitive advantage. Studies by Goleman in the USA, reported by Brown (2001), found that in low-skill work the highest-performing workers contributed twice to three times as much as average workers, while in professional jobs top performers were capable of adding ten times as much value as their co-workers.

Economic recession − a war on talent management strategies:-

The extent to which organisations are changing their talent management strategies in the face of a recession was examined by the CIPD late in 2008 and clearly the economic conditions prevailing in 2009 represented a significant change in the world of work. This resulted in both negative and positive effects on talent management activity. So, was it a war on talent management strategies? For some organisations the economic challenges were such that development budgets were cut, recruitment was frozen and redundancies became the order of the day (CIPD, 2009b). Changes made to reward strategies included restricted pay increases, or in some cases pay reductions, an increased focus on rewarding top performers only and further interest in individual performance-related pay. The economic conditions also placed pressure on employer branding initiatives, as return on investment in talent management strategies came under closer scrutiny.


The second Essential reading for this topic is:

Pilbeam, S. and M. Corbridge People resourcing and talent planning:HRM in practice. (Harlow: Pearson, 2010) 4th edition. Chapter 4 Human resource planning, talent planning and worker flexibility.

Remember that all the Essential reading for this programme is provided for you.Click ‘next’ to go to the next page and start reading.



Stephen Pilbeam and Marjorie Corbridge, People resourcing and talent planning: HRM in practice (Pearson, 2010; 4th edition)


The changing political, economic, social and global contexts of organisations have become catalysts for stimulating changes in the way in which work is organised. One adaptive response to these influences can be identified in trends in the changing patterns of work. The argument for continuous and broad human resource planning, in contrast to numerically focused workforce planning, is also a response to more turbulent organisational contexts. Traditional approaches to work organisation based on hierarchy, formalised structures, job definition, demarcation of activities and bureaucratic control may be less suitable for uncertain and unpredictable environments. Dynamic working environments require more organic responses and the pursuit of flexibility at work, in all its forms, can be viewed as another functional adaptation by the organisation to these external environmental influences.

Forms of flexibility from the employer perspective:-

Flexibility at work can be defined as:

the ability of the organisation to adapt the size, composition, responsiveness and cost of the people inputs required to achieve organisational objectives.

Various forms of flexibility exist and common categories include functional, numerical and financial (Leopold and Harris, 2009; Beardwell and Claydon, 2007; Redman and Wilkinson, 2006; Atkinson, 1996; Bramham, 1994). Categorisation should not suggest that the forms of flexibility are mutually exclusive and many forms of overlapping flexibility exist (Figure 4.4). Managers need to distinguish between these forms of flexibility in order to be able to seize opportunities for increasing organisational flexibility, but they should also be aware of the problems.

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Functional flexibility:-

This relates to the employer’s ability to deploy people in response to work priorities and demands. It can be either horizontal or vertical. Horizontal implies a reduction in demarcation between activities and tasks at the same level while vertical functional flexibility involves the acceptance and performance of tasks and activities by employees at either a lower or a higher job level. Functional flexibility is closely associated with skills flexibility (in order that employees are capable of performing the required tasks), with attitudinal flexibility and the redesign of work processes, equipment and layout. Reward systems need to be compatible with functional flexibility objectives so that task demarcations are not perpetuated or reinforced. Working practices which incorporate elements of functional flexibility include teamworking, empowerment, multi-skilling, re-skilling and project working.

Numerical flexibility:-

This is the scope to expand or contract labour supply through altering the number of people employed in proportion to product or service demand. It relies on the quick and easy engagement and release of people through rapid recruitment responses and the use of fixed, short-term or temporary contracts. Numerical flexibility also involves the increased use of agency staff and the subcontracting of work. It requires an acceptance by management that using employee redundancy is a legitimate human resource practice.

Temporal flexibility:-

This is concerned with restructuring working hours to increase organisational responsiveness to work demands. It has the aim of maximising productive time and minimising unproductive time and may be formal or informal. Formal temporal flexibility can be achieved through the use of annual hours arrangements and through zero- or core-hours contracts. Flexitime arrangements constitute temporal flexibility, but in this case they are primarily responsive to employee, rather than employer, needs. Informal temporal flexibility includes employee discretion to adapt working hours to work demands and also the growing expectation that employees should work ‘beyond contract’ when necessary (the concept of elastic working hours).

Financial flexibility:-

This increases the ability of the organisation to control employment expenditure. It is pursued in a number of ways. First, through the use of local market rates to determine the commercial worth and the reward package of employees to ensure value for money in employing staff. Second, through the use of individual pay arrangements instead of collectively regulated and uniform pay levels. For example, performance-related pay and profit-related pay. Third, through shifting from national or central bargaining to local bargaining arrangements to intensify the linkage between employment costs and local affordability. Fourth, through the use of non-consolidated bonus pay and non-pensionable payments to avoid those payments which relentlessly and permanently increase the pay bill.

Skills flexibility:-

This incorporates not only skills development and acquisition, but also employee receptiveness to the updating and extension of the skills necessary to reduce job demarcation and promote employee versatility. Skills flexibility may be vertical or horizontal through a deepening or a widening of the employee’s skill base.

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