The socioeconomic changes that take place in a nation impact that way in which each and every industry operates. The alteration of business dynamics also forces its function and processes to be re-evaluated and redesigned to match up with the changes going on in the economy. Companies need to be proactive to foresee the challenges that its functions face as a result in order to harness the opportunities that future has to offer. Here are the ten challenges that the HR function in India faces:
The first and foremost challenge that HR function in India faces is to convert the abundant population pool into useful human resource.
Training and development of human resource to match ever changing industry demands requires HR to develop new and innovative ideas that suit individual as well as industry criteria.
Employee motivation and satisfaction is another area of concern for the HR today. In order to reduce attrition, HR needs to realize that monetary needs are not the only drive for an individual and that a sense of belongingness must be imbibed in employees.
With the increase in number of job options available nowadays, the HR function of an organization must take care that they hire those people who believe in long-term commitment to the organization. The HR then must take up the challenge of retaining them by developing retention techniques like Holiday plans fun-at-work etc.
Because of cutthroat competition, HR in India also faces the task of building competitive advantage for the company over national and international competitors.
The growing importance that companies are nowadays giving to cost-cutting has posed HR with the challenge to minimize expenditure on HR not compromising on the productivity.
Since right-sizing has been a growing trend in Indian organization, the HR now faces the task of identifying and retaining the key employees of an organization and letting go those that do not suit its future requirements.
HR also faces the challenge of creating a balanced organization that originates from mergers and acquisitions. HR needs to assimilate those policies that are mutually agreeable to the companies being merges as well as profitable for the new organization. It also needs to take care about the organizational structure of the emerged organization.
Globalization poses HR with challenges such as expatriation and repatriation. HR needs to train employees that leave their nation for fulfilling a foreign assignment. It also needs to provide such employees with adequate moral support and assure them of job security on their return.
With multinational organizations on the rise, HR needs to focus on issues such as cross-cultural training so that problems that can arise because of differences in international professional values can be diminished.
For a better understanding of what are the demands over the HR function in India, a few industry specific examples will be useful:
HR Challenges in retail Industry: The retail industry in India is likely to face demographic, economic and technological changes in near future. These challenges arise from growing population, competition, increase in disposable income, and opening up of geographic markets. The challenge for the HR of retail industry lies in converting the abundantly available human resource into scarcely available talent pool by providing adequate training.
HR Challenges in banking Industry: The banking sector has been growing at a very fat pace in India not only in the terms of its size but also in terms of the services being provided. With banks reaching the remote areas in the country one can anticipate positive things like financial aid to farmers and increased financial awareness. However, with the increase in size and activities of banks, the number of banks in private sectors has also increased thereby posing challenges like cost-efficiency, technological advancement, and credibility related issues. The task before the HR is to develop strategies that help banks in gaining competitive advantage and encourage innovation in its products and services.
HR Challenges in manufacturing Industry: Indian manufacturing industry is one of the largest industries in the world. The challenge before the HR for this industry lies in recruiting the right working age population and focus on capacity building. Moreover, personal must be trained in using technologically advanced modes of production.
There are various other challenges that the HR function faces owing to its changing face in India. Earlier it was understood to be a function more or less administrative in nature. However, it has now been realized that HR need to be made a part and parcel of business strategy for a better understanding of processes and policies. Merging HR with other core functions of management has helped in giving a macro view to the business environment. The challenges that seem to stem from the changes being brought about in the socio-economic milieu can be stopped, but can be controlled with timely intervention.
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—About our writer:
Shivangi Sharma has obtained an M.B.A degree in HR from ICFAI (Gurgaon) and is presently working with an LPO as a summarist. Prior to that she worked as a content writer in a leading publish house. She has worked on scripting academic/reference books for students pursuing graduation or post-graduation. She also likes to write poetry and maintains a blog.
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