Managing Human Capital And Leadership Solved Assignment (Doc)

MANAGEMENT HUMAN
CAPITAL AND
LEADERSHIP

ABSTRACT
Management of human capital and leadership is primarily concerned with attracting,
developing and managing the talent in order to attain the competitive advantage. There are
various models and approaches which the organizations uses for effectively managing the human
resources like Warwick model and guest model, proactive approach and strategic approach.
Besides this, Companies uses a range of recruitment processes like newspaper advertisements,
promotions and selection process like interview to achieve the initiatives of strategic human
resource. The two approaches of HRD that is strategic framework approach and human capital
approach assist in effective recruiting and attracting the talents as well as providing rewards to
them. Apart from this, the Maslow theory of motivation encompasses the various tools which
eventually motivate the individual to attain personal as well as organizational objectives.

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................2
MAIN BODY..................................................................................................................................2
Models and approaches for Human resource management.........................................................2
Hiring and selection relative to strategic human resources and recommendations for enhancing
the process...................................................................................................................................4
HRD approaches and recommendations for improving it...........................................................6
Classical theories of motivation..................................................................................................7
Characteristics of Leadership....................................................................................................10
CONCLUSION.............................................................................................................................12
REFERENCES..............................................................................................................................13
1

INTRODUCTION
Management of human capital and leadership is basically the set of practices and
procedures which are used for managing the human resources within an organisation as well as
helps in developing the talented employees. HSBC bank is a renowned investment bank as well
as financial services company established by Thomas Sutherland in the year 1865 and placed in
London, UK.
This essay primarily addresses the models and approaches for Human resource
management, Hiring and selection relative to strategic human resources and recommendations
for enhancing the process, HRD approaches and recommendations for improving it, Theories of
motivation, Effective leader’s characteristics.
MAIN BODY
Models and approaches for Human resource management
As per the view of Subramony and et.al., (2018) a company uses a wide range of HRM
models which help them to legitimize the different HRM practices and thus serve as a tool for
understanding the significance of key issues in human resource management. Among all, one of
the well known model is the guest model being established by popular David Guest in the year
1997 and postulates that the HR manager adopt certain strategies in the beginning which calls for
specific practices and once executed, results in the long term outcomes. This model is considered
as superior in comparison to other models as it primarily focuses on the strategic management
besides emphasising on the personal development. In short, this model mainly stresses on needs
of every individual rather than collective workforce. This model comprises of six different
components namely HR practices, strategy, etc. which ultimately help in tuning the individual
interest with organizational strategies.
As illustrated by Lin and et.al., (2017), another model of HRM which is Warwick model
was intensively established by Hendry as well as Pettigrew wherein it focuses on identifying the
different business strategy along with HR practices and external as well as internal context under
which the activities of the organization occur. Besides this, it also addresses the process through
which varied changes occurs including the relation between changes within both the context as
well as content. This model's core strength lies in recognizing and classifying the essential
influences of environment on HRM. This model revolves round five major factors which are
outer forces like macro environmental, inner forces including micro environmental, Content of
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business strategy, HRM context and HRM content. It generally maps the interrelation between
macro and micro environmental factors as well as explores the tactics adopted by HRM in order
to adapt these changes within the context.
HSBC generally uses guest model where its HR adopt specific strategies and takes into
account every employee's needs fro managing the human resources.
As illustrated by Di Fabio and Peiró (2018), Organizations use different kinds of
approaches among which the highly used two approaches are strategic approach and proactive
approach. Strategic approach of HRM is basically the mixture of numerous decisions as well as
activities which recognizes the performance of companies in long term. It is usually the concept
wherein human resources of firm's are effectively managed and controlled. To make this
effective, HR plays a crucial role in terms of strategic partner when organization's policies are
being implemented. This approach generally involves finding the ways through which HR can
project a direct influence on growth of company and is demonstrated throughout the various
activities like training, compensation, hiring etc. With the help of this approach, Company carry
out the assessment of employees along with determining the steps needed to enhance their value
within company and eventually uses analysis results to develop numerous HR techniques.
According to Joo, Lim and Kim, (2016), A proactive approach is also another way
through which the organizations anticipates different challenges along with the problems just
before they occur. A proactive HR is basically the development of various plans for hiring,
selecting and motivating the people. It involves crafting the particular plan for selecting the
employees who will prove to be best fit for companies. Under proactive approach, these plans
created by HR are typically formulated before the issue arrive and includes intentionally
recruiting the employees and paying them which ultimately helps in motivating employees.
Having a proactive approach help the companies to foresee any contingencies and thus aids them
to take actions which will prove beneficial in overcoming the different crisis. Thus, this
approach will ultimately save considerable time of companies along with money in long as well
as short run.
HSBC bank, in order to overcome the financial as well as human capital crises currently
uses strategic approach where the human resources are effectively managed and ultimately helps
them efficient decision making.
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Hiring and selection relative to strategic human resources and recommendations for enhancing
the process
As per the views of Arena and Uhl-Bien, (2016), Recruitment is basically the procedure
of recognizing the prospective candidates and attracting them for the job which is vacant.
Organizations generally utilizes a wide range of recruitment sources namely internal and
external. Under external, Newspaper advertisement is highly applied source within which the
company advertises the details of vacant job in newspaper and hence, attract them by posting the
various details of job and the place. This method aids the companies to reach wide geographies
and create a large pool of talent.
On contrary to this, promotion is a popular source which the companies uses while
recruiting internally. In this, the existing employees are given a chance to upgrade their skills by
placing them on higher position and promoting them to another level. They are inculcated with
more responsibilities and hence enjoy greater prestige. Promotion boosts up the morale of
employees and help them in understanding the roles of cross functional departments. Besides
this, it saves the cost of hiring as the employees already know the working environment. Unlike
recruitment, selection encompasses choosing the correct candidate from the talent pool who
perfectly matches the requirements of job. The most frequently used selection method involves
interview whereby the applicant comes across a discussion within which sharing of information
occurs between recruiter and candidate that helps the company to assess the knowledge base of
candidates. The interview process, apart from judging the skills helps the organization to analyse
whether the candidate has potential capability to achieve the long term objectives. Assessment
test is another method of internal recruitment wherein the applicants go through a series of tests
which eventually help the companies to assess their mental ability, physical fitness, required
skills etc. To attain the competitive advantage, every step of hiring and selection requires careful
consideration as the decision crafted in these process affects the future of company. Based
decision will lead to high cost for companies therefore it forms a major part in strategic HRM
and help companies in achieving the SHRM initiatives.
HSBC bank generally utilizes newspaper advertising where the HR of company post
vacancy in newspaper to entice the candidates. Besides this, HSBC adopts assessment test for
selecting the correct candidate where they design their own aptitude tests to analyse the
knowledge of applicant.
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Recommendation
As illustrated by Suseno and Gengatharen, (2018), For having an effective process of
hiring, organizations first need to understand what the vacant position calls for. Without having
the in depth knowledge of the job, recruitment is useless thus, the HR department needs to first
analyse the roles of vacant position along with skills and knowledge required to perform that role
effectively. Besides this, the creation of ad for employment should be consistent enough like
when placing the job in newspaper, its structure should be well defined and should contain
detailed information about the place and timing of hiring, nature of job etc.
Moreover, Automating the entire recruitment process is highly essential which will allow
the HR department to customize every step like profiling of the resumes, filtering the most
suitable CV etc as recruitment is somewhat complicated and requires extreme strategic planning.
Thus, the company should be Tech-savvy and should utilize software and applications which
give them the best possible outcome in terms of highly productive employees and will bridge the
space between traditional and modern approach of HRM. Besides relying on optimization in
computers, recruiters can also employ mobile platforms to look for the information about
different available jobs. HR professionals can take the help of numerous mobile apps which will
serve as a potential tool for attracting the candidates as well as can be helpful in making the
process more convenient and smoother than the traditional tools. An efficient applicant tracking
software will eventually help the HR professionals in sorting the applications under real time and
sorting the wide range of data within short period of time. Thus, selecting the appropriate and
relevant matrices will help the HR department in selecting the correct candidate who have the
potential to meet the long term objectives.
HSBC bank can thus adopt these strategies in order to make their recruitment process
more defined and easier and through which they can attract the right candidates.
According to Noe and et.al., (2017), On the flipside, for improving the process of
selection, an organization should be data driven and should use the advanced technology for
firstly designing the assessment framework which will help the recruiter to know the ways for
measuring the applicant's traits. Besides this, the organizations should have data analysis
software and programme for recording the proceedings as well as responses of interview like a
voice recorder, computer aided systems etc. The process of application should be simple as well
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as quick for applicants which will save the candidate's time as lengthy process decreases the
confidence within candidate. Besides this, the HR department should create a checklist for
carrying out the interview which will encompass the various questions regarding the interview
for recruiter and this will help in extracting more information about the candidate and selecting
the best candidate. Apart from this, HR professionals can create games related assessments to be
filled by candidates like surveys, questionnaire which will give a better understanding about
them without having to questioning a lot in the interview. The interviewer should beforehand
design the list of questions to be asked during the interview which will not only save the time but
will help the recruiter to get the answers on point rather than gathering the useless information.
HRD approaches and recommendations for improving it
As per the view of Hili and et.al., (2017), Human resource development is basically the
framework within which the employees are being assisted and encouraged to develop their
organizational as well as personal skills, capabilities etc. There are wide range of approaches in
HRD among which the most popular are human capital approach and strategic framework
approach. Human capital approach was established by Friedman and David in 1998 which
stresses that there are generally five stages under the maintenance of human resource which are
classification stage, design stage, assessment, implementation and monitoring stage.
Opposite to this, there usually exist five areas for managing the human capital namely
retention, recruitment, retirement, performance management and rewards. The organizations
develops a 5 by 5 matrix by utilizing these areas and five stages which is used as an assessment
tool for evaluating and managing the human resource in later stage. The strategic approach was
implemented by Ulrich In 1990 where the main objective is to leverage the HR practices in order
to create crucial organizational capabilities which enables the firms to attain their goals and
objectives. Its framework mainly comprises of business strategy, HR practices and
organizational capabilities. Thus, this approach provides basic tools for aligning the HR
practices and managing the transformation.
HSBC bank currently uses human capital approach where they, through its each stage
effectively manages the human capital and create the efficient workforce for the company.
Recommendations
According to Barbuto and Gottfredson, (2016), In order to improve the process of HRD,
the organization can adopt numerous strategies like offering effective training, feedback,
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performance appraisal which will lead to increase in productivity as well as profitability of the
company. The highly used strategy for the development of human resource which the firms can
adopt is providing the vocational training to the employees and educating them on the utilization
of latest technology. Besides the intensive training programme, feedback and 360 degree
assessment can be a useful tool for grooming the employees personally as well as professionally.
A thorough performance evaluation every month will help the organization to have tracked the
performance of employees apart from enhancing their morale and knowledge base.
HSBC bank should adopt these tactics for improving the productivity of human resource
their credibility. These tactics will eventually help them in monitoring the employee's
performance and motivating them.
Classical theories of motivation
It is very important to motivate employees from time to time so that they can be retained
for long term. Also, it improves their working efficiency and overall organisational performance.
Alongside it, with motivation it becomes easy to create a positive culture. The goals and
objectives are attained in more effective way.
There are various theories of motivation which are defined as below :-
1) Maslow's hierarchy of needs theory
2) Herzberg's two factor theory
3) Theory X and Theory Y
Maslow's hierarchy of needs theory
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Figure 1 Maslow need theory
(Source : Christine Mason, 2016)
It is common theory that is used by companies to motivate employees. It contains five levels of
needs which are essential for human (Bouzenita and Boulanouar, 2016). Maslow proposed this
theory of motivation under the five needs that are necessary to fulfil them by every human and
those needs of humans, motivate them to work. These needs are:
Physiological needs- it includes the most basic needs of humans to survive, such as air, water,
food, shelter and clothing. In other words, it is the basic need or amenities of life for an
individual.
Safety and security- It includes needs that are protection form theft, security, etc.
Social needs- After security needs human require social needs which include love, family,
friends, etc.
Esteem needs – this need is required for reputation and respect. It includes recognition,
confidence, etc. they are divided into two categories.
Self actualization needs- It is the last level of need where an individual seek for growth for their
own benefit.
Herzberg's two factor theory
It was developed By Herzberg which include two factors that are described below :-
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Hygiene factors:
They are the factors which include hygiene at workplace. It fulfils employee needs and
motivate them for long term. There are many other included in it which are as follows :
Pay the salary must be appropriate and reasonable. It should be equal and competitive to
those in the ABC organization at same domain.
Company policies and administrative policies organization – the flexible policies will
enable employees to encourage. This means working hours, week offs, etc.
Fringe benefits means benefits other than salary or incentives.
Physical working conditions state working condition of an organisation. It must be safe,
secure, etc.
Interpersonal relationships the relationships of the employee with his superiors, peers,
etc.
Motivation factors:
Apart from hygiene there are some motivational factors as well which contribute in
motivating employees. It also plays an important role. They are describe below :-
Recognition the manager should praise and recognize the accomplishments of the
employee.
Responsibility Manager sometime should give employees ownership of the work so that
employees can hold themselves responsible for the work.
Theory X and theory Y
The theory was given by McGregor in which two features was considered that are X and Y
X refers to negative things and Y refers to positive things. In X employee avoid to work and
remain absent most of time. Also, they do not take interest in their work. On other hand Y
assume that employee loves their job and want to learn to attain goals. So, by evaluating both X
and Y employees are motivated.
Leadership is the ability of leader to motivate the team in given situation and help to
achieving goals. A leader must possess self-confidence, belief, etc. Good leader increases the
employee learning interest and knowledge.
Hybrid theory of motivation
HSBC Malta can implement the best hybrid theory of motivation from the above discussed
theories should be Maslow's and Herzberg's two factor theory. As combination of these theories
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shows the most essential needs of an employee such as psychological, safety and security, social,
esteem, self-actualization, inter-personal relationships and job security needs from Maslow's
hierarchy of needs theory along with good hygienic and motivational factors which includes pay,
policies, sense of achievements, meaningfulness of the work, status, from Herzberg's two factor
theory. These theories will be useful in motivating employees. With it their performance will be
enhanced and staff will put more hard efforts in attaining goals and objectives.
Characteristics of Leadership
As elucidated by Al Jounaidi and Mohamed, (2018) Leadership is an art of motivating and
leading the team. The most popular features of good leader are. A good leader always has a clear
vision that help them to accomplish goals and get success. A clear vision helps to make good
strategy to achieve the goal. Focus is most important part for successful leader, without focus
your ability of thinking, learning, problem solving, decision-making will suffer.
For good leadership leader must have quality of delegation. Once a leader understands the
potential and strength and weaknesses of his team, he gives job accordance with his strengths.
One of the most important quality of leadership is Confidence, for challenging situations a
successful leader always remains confident. He motivates his team to ignore the negativity in
success journey. He maintains his confidence to achieving the goal, team always expect high
level motivation but it difficult with negative attitude of leader.
In view of Dulebohn, and Murray, (2019) a good leader take work seriously. They are
also good communicators they have ability to talk effectively. Another important leadership
strength is outstanding strategic planning skill. Leader should able to understand the problems
and create strong strategy for solution. Leader use creativity so many times while carrying out
various tasks. A leader thinks out of the box in odd situation. Another leadership quality has
good inter-personal relations with all team members. They understand the approach and process
of each team members. This is the think that differentiates a leader from a manager. A successful
leader has to be pro-active and not reactive. A Leader need to judge problem in advance through
his intelligence level. A leader to be a transparent while working in company or performing task.
Leader must trust on his team members & make them trust back. Leader must have self-
discipline in behaviours and lifestyle. Self-control allows person to focus on one goal.
Also, there are various models as well of leadership as stated by Renz, and Herman, (2016).
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The Authoritative leader targets on setting and achieving goals. It creates the team that can
work in any situation, with focus on clear vision & end results. This is completed by the
providing clear path to success. The Authoritative leader has good and strong thinking skills and
do things differently. This model creates success-culture in the office. Here, the leader
characteristic is vision as they set long term goals which provide clear understanding to team
members. They plan for all the work methods and processes.
Autocratic leaders give more control on teams. In this model team members have limited
options of suggestion and comment on what is best for team. Without any doubt it gives
incurable result, easy to make decisions quickly and get efficient solutions (Tong, Li, and Greiff,
2019). It can be used in critical situation when need to make decision & implement decision
without wasting time, it allows the team to focus on allotted task and help to achieve mission.
Characteristics of this leadership include: they delegate their tasks effectively means assign roles
to members. They perform all roles and responsibilities properly.
Charismatic Leadership model is similar to transformational leadership model. According to
this model team leader inspire the team members to do hard work. This leadership creates the
positive environment, team spirit, etc. Characteristics of charismatic leadership include : This
type leader possess communication skills, they hear and solve issues and maintain discipline
within team.
Transactional model– Here, the leader allows employees to work with their own self-interest.
The team follow instructions of leader and work accordingly. Also, leader motivate it different
way that is by giving reward or promotion to those who have performed well and punishing
those who have not. In this way leader creates strong bond with employees and attain goals and
objectives.
Democratic Model- Here, the leaders allow the staff to work in creative way and take part in
decision making process. These gives job satisfaction to team members. Characteristics of
democratic leadership include distribution of responsibility, empowering team members and
decision making.
Bureaucratic Model- In this model there are specific rules and regulations formed which has to
be followed by employees. This enables them to work in systematic way and superior monitor it
closely. In that there is no flexibility provided to staff as they have to work according to set rules
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(Hili and et.al., 2017). Here, leader characteristic define commitment to their work. They follow
their own rules and strategies.
Laissez-Faire Model- It is a type of style which allows employees to work as per their interest.
The leader also works freely with their team. With this he or she is able to monitor team
performance then given suggestions or guides them. This style is usually followed when change
has to be implemented. Here, features of leader are open mind, creative skills, etc.
CONCLUSION
In HSBC Malta, management of human capital and leadership are basically the set of
practices and procedures which are used for managing the human resources within an
organisation as well as helps in developing the talented employees. HSBC Malta use different
kinds of approaches for human resource management among which the highly used two
approaches are strategic approach and proactive approach. Strategic approach of HRM is
basically the mixture of numerous decisions as well as activities which recognizes the
performance of companies in long term. Classical theories of motivation are the building blocks
of contemporary theories developed later. Till date these classical theories are used by working
managers and taught professionals in HSBC Malta to explain the concept of employee
motivation.
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REFERENCES
Books and Journals
Al Jounaidi, A. R. and Mohamed, H., 2018. The Role of Leadership Management on the
Performance of Employees: A Literature Review. Arrasikhun Journal.4(1). pp.7-12.
Arena, M. J. and Uhl-Bien, M., 2016. Complexity leadership theory: Shifting from human
capital to social capital. People and Strategy.39(2).p.22.
Barbuto Jr(Jay), J. E. and Gottfredson, R. K., 2016. Human capital, the millennial's reign, and
the need for servant leadership. Journal of Leadership Studies.10(2). pp.59-63.
Di Fabio, A. and Peiró, J., 2018. Human Capital Sustainability Leadership to promote
sustainable development and healthy organizations: A new scale. Sustainability.10(7).
p.2413.
Dulebohn, J. H. and Murray, B., 2019. LEADERSHIP, PERFORMANCE MANAGEMENT
AND TEAM CENTRIC ORGANIZATIONS. The Only Constant in HRM Today is
Change, p.199.
Hili, P and et.al., 2017. Effect of human capital and leadership on institutions performance and
competitive advantages.
Joo, B. K., Lim, D. H. and Kim, S., 2016. Enhancing work engagement: The roles of
psychological capital, authentic leadership, and work empowerment. Leadership &
Organization Development Journal.37(8). pp.1117-1134.
Lin, C and et.al., 2017. The role of human capital management in organizational
competitiveness. Social Behavior and Personality: an international journal.45(1). pp.81-
92.
Noe, R. A and et.al., 2017. Human resource management: Gaining a competitive advantage.
New York, NY: McGraw-Hill Education.
Renz, D. O. and Herman, R. D. eds., 2016. The Jossey-Bass handbook of nonprofit leadership
and management. John Wiley & Sons.
Subramony, M and et.al., 2018. Leadership development practice bundles and organizational
performance: The mediating role of human capital and social capital. Journal of business
research. 83.pp.120-129.
Suseno, Y. and Gengatharen, D., 2018. The role of human capital, psychological capital, social
capital and leadership capital in building an athlete's global brand image. International
Journal of Sport Management and Marketing.18(6).pp.515-534.
Tong, T., Li, H. and Greiff, S., 2019. Human capital and leadership: the impact of cognitive and
noncognitive abilities. Applied Economics. pp.1-12.
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