Analysis of HRM, Resource Based View, and UK Labour Market Threats

This report provides a comprehensive analysis of human resource management (HRM) through the lens of the Resource Based View (RBV), exploring how organizations can leverage their internal resources to achieve competitive advantage. It explains the RBV framework, including its core assumptions of resource heterogeneity and immobility, and introduces the VRIO framework as a tool for assessing the value, rarity, imitability, and organizational aspects of resources. The report also examines two major threats currently facing organizations in the United Kingdom labour market: the shortage of a skilled workforce, exacerbated by Brexit, and poor productivity. The report uses examples of companies like Google and Amazon to illustrate effective HRM policies and Barratt Homes to highlight the impact of skilled labour shortages. The report concludes by emphasizing the importance of strategic HRM in achieving long-term competitiveness and sustainability.

Managing Human Resources

Table of Contents
INTRODUCTION...........................................................................................................................1
Main Body.......................................................................................................................................1
Explain how the ‘Resource Based View’ can be adapted to Human Resource Management to
help deliver competitive advantage and organisational success.................................................1
Analyse two major threats currently facing organisations operating within the United
Kingdom labour market, using evidenced examples as part of your critical assessment...........4
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................9

INTRODUCTION
Human resources can be defined as the most important and valuable asset of the firm
because without their efforts organisational goals can't be achieved within a specific time-frame.
This term is also used for a division which is responsible for management of employees at
workplace. In addition, this department have also responsibility of managing and developing
specific skills in the working staff so that with the help of them competitiveness can be gained by
the organisation. This is an important task for the firms to manage or retain their human
resources so that contribution can be taken from them for a longer period of time. Present report
will discuss about the analysis of managing human resources at workplace through taking
support of resource based view so that reasons of competitive advantage can be identified in easy
manner. In addition, analysis of threats which are faced by organisation in marketplace of UK
will also covered under this report.
Main Body
Explain how the ‘Resource Based View’ can be adapted to Human Resource Management to
help deliver competitive advantage and organisational success.
Resource Based View: This is a framework that is used by management for allocating
effective resources for the organisation so that competitive advantage can be gained in
marketplace. For achieving competitive advantage, organisation have to use their resources in
effective manner. In addition, resource based view also make focuses of managers to manage
internal resources rather than external so that key performing assets, capabilities and consistency
of workers can be identified which leads the firm towards competitive advantage in market. This
view also provide a method in which organisation can apply their internal resources so as to
gaining strong position in marketplace. For determining capability of organisation there are two
assumptions are mainly consider such as resource diversity and immobility.
Resource diversity is defined as the management of those resource which a company
owns and are distinct in nature. In addition, this is a process in which organisation recognise
uniqueness of its all individuals so that their maximum efforts can be used for achievement of
goals (Tillsley, 2017). Whereas, if other company have same resources along with similar skills
than it will not considered as the distinct resources and company will not be able in gaining
competitive advantage in marketplace. Apart from that, resource immobility can be defined as
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the resources which are valuable and expensive and not be gained by competitors than it will
provide competitive advantage to the organisation. It includes product development plan,
manufacturing resources etc. because these are can't be adopted by each organisation in easy
manner than these resources can be used by the organisation for achieving competitive advantage
over its rivals.
An organisation mainly operates its function through using two components like
resources and products or services which are generated by utilising of its resources. According to
this, company should measure its performance and competitive advantage which can be
determined by company's resources. It mainly works on the basis of two assumptions in which
first is heterogeneity of resources which are used by organisation in their production of goods
and services. Whereas, second one is related with capabilities and efficiency of employees that
can't be imitate by other firms and assist the firm in gaining competitive advantage. Resource
based view also assist the management of organisation in managing or retaining its able or
experienced employees for a long time period so that sustainable competitive advantage can be
gained by organisation. There are several resources and capabilities existing at workplace which
are not enough for an organisation so as to gaining success in marketplace because competitive
advantage can be gained through effectively using distinctive resources or capabilities of firm. In
addition, for achieving competitive advantage in market firm have to use those resources which
are owned or controlled by themselves and their rivals can't be adopt or copied these resources in
easy manner. Inventors of Resource based view have also stated that competitive advantage is
mainly formulated on the basis of resources and capabilities which are mainly controlled or hold
by a single association. For implementing human resource strategy, resource based view provide
an analysis tool which is also called VRIO framework and it mainly focuses on HR executive
role as a strategic partner in development or sustainment of organisation with a competitive
advantage in market (Shields, 2015).
VRIO framework is a tool which is used by organisations in order to identifying their
capabilities and resources so as to gaining competitive advantage for a long time period. It
includes four components that helps the firm in taking competitive advantage these four
components are Value, Rarity, Inimitable and organisation. In Value, management of
organisation should consider their human resources as valuable because without their effort firm
can't achieve its goals and objectives in effective manner. For increasing productivity,
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management of organisation can measure the performance level and whose performance is not
good can be terminated effectively so that knowledgeable and eligible employees will be
retained at workplace who will provide their contributions in achieving competitive advantage at
marketplace. Whereas, these are not rare in nature because these are available at each
organisation. Next Stage is related with rarity of resources, as the human resources are valuable
in nature then management should provide training and development to them so that necessary
skills or efficiency would be implemented in them which will be helpful in increasing
productivity or profitability of organisation. As each firm's production process is different then
required skills or efficiency will also different in nature so that it can be said that skills or
attributes of human resources are different in nature which can't be imitate by its rivals. As each
organisation can arrange training programmes for their employees so as to increasing its
productivity that are termed as inimitable but organisational structure or product development
process is different which can be considered as unique or can't be copied by any organisation and
that can be used for gaining competitive advantage in marketplace. This step of framework also
states that firm should more focused on the development of team work so that healthy working
environment can be established at workplace which leads the firm towards competitiveness over
its rivals for a long period of time. For gaining competitive advantage and sustainability it is very
essential for each firm to maintain effective organisational structure at workplace so that value of
resources can be increased which are rare in nature and can't be imitate by any organisation.
According to this analysis, it is very important for each organisation to monitor each activity or
functions through utilising resources in effective manner so that functions of firm would be
managed in proper manner. For achieving competitive advantage for a long time period,
Management of organisation should examine that their employees are working in a valuable
nature or using their skills that are rare and can't be copied by anyone. For getting better
contribution from employees, management of firm have to provide incentives and rewards to
them on a specific interval of time period so that they feel valued at workplace and provide better
efforts for accomplishing the given tasks (Newenham, 2015).
From the above model it has been identified, Implication of Resource-based view of
Human resource management is that if firm wants to gain competitiveness and sustainability in
market than they have to mainly emphasise on its HR policies because these are very supportive
in this. In addition, HR policies are formed by organisation so as to identifying its core
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competency and capabilities which leads the firm towards gaining strong market position in
market. For effectively understanding the implementation of resource based view an example of
HR policy is taken which is associated with Google, Management of Google follows several
innovative policies and techniques so as to retaining or motivating their employees for a longer
period of time. These techniques includes salary, incentives, bonuses or other rewards which are
provided by them to their employees on a specific interval of time period so that they get
motivated and retained at workplace. For retaining their employees as long as possible they use
several policies which are favourable for their employees because without their efforts
organisation can't increases their revenue and sales figures. So that, it can be said that this is very
important for an organisation to consider the needs and wants of employees and helps them in
achieving their personal and professional goals. An another e.g. of HR policy of Amazon is taken
in which company only recruits highly knowledgeable or experienced candidates so that their
core characteristics can be used in gaining strong market position. They also pay quit policy
which helps them in retaining their employees, In it, they offers amount of $2000 to $5000 to
their employees if they have decided to quit the firm but if any employee takes the money then
they have to leave the firm and Amazon will not hire these employees again at their workplace.
(Why Amazon pays employees $5,000 to quit) This policy is more effective for terminating
those employees who are dissatisfied with their job and wants to move in other firms so as to
taking growth in their professional career.
Analyse two major threats currently facing organisations operating within the United Kingdom
labour market, using evidenced examples as part of your critical assessment
There are mainly two threats i.e. shortage of skilled workforce and poor productivity
which are negatively influencing the business operations of firms which are operating within
UK. In present scenario, most of the organisations have adopted technological advancement in
their production process but they are facing shortage of skilled labours. Main reason behind this
shortage is the impact of Brexit and technological enhancement in each field of work. Due to
impact of Brexit, a large number of skilled workers have moved towards other developing
nations where there is no shortage of technically skilled and efficient employees. Due to this,
companies which are operating in UK are facing the problem of shortage of skilled workers in
the firm. As an impact of Brexit, most of skilled and efficient workers were move towards other
developed nations where is no need of skilled workers because they are already developed as
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well due to which a large number of organisations of UK were facing poor productivity and
inefficient performance of workers. Due to this shortage, company's profitability is decreasing in
marketplace because without skilled and efficient employees company is not able in delivering
desired quality of products to the customers and as a result of it, market value and position of
firm is decreasing on regular basis. There are several organisations which are operating their
business operations in UK and uses advanced techniques in order to produce goods and services
of better quality, but these are negatively impacted because of unavailability of skilled and
efficient workers at workplace.
Problem of shortage of skilled workforce is face by Barratt homes which is a renown
builder in UK and a part of Barratt Development plc which is also known House of builders in
London. Due to insufficiency of skilled labour in sector of construction difficulties like poor
performance level of employees is facing by company. As company is renown in construction
sector then it has highly developed its technological equipments but due to unqualified workers
company has not gained its expected profitability in market. Rate of unskilled labour is increased
in UK because of falling migration from European Union. According to the report of office for
national Statistics, one third of workers on construction sites were from other nations like more
than 28% from European Union (What does Brexit mean for construction, 2019). Future of UK's
construction mainly depends on availability of skilled workers but due to unskilled workers
organisations of construction field are unable to deliver expected building projects to their
customers.
Inability in finding of efficient employees can impact the organisation which are
operating their functions in UK in two ways. First one is related with cost of skilled labour which
has been increased as a result of it, skilled labour force can't be find by the organisations easily
and who are eligible and have efficient skills does not wants to work in lower rates. According
to 2018 report of National office of statistics, Cost of skilled labour is regularly increasing than
the expected growth of nation as a result of it, rate of skilled labour workers is increased up to
3.5% which is higher than last three years. Second impact which is facing by the organisations is
that they are not able in making modifications due to which old patterns and machinery are using
by workers and as a result of it, companies are not able in fulfilling expectations of customers.
Due to lack of skilled workers, confusion is created among the management of firms of each
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sector as they can't make decisions whether they make investments in training of unskilled
labour or implementation of advanced technology at workplace.
Trouble of insufficiency in number of skilled labour is also faced by Tesco plc. Because
company is facing difficulty in finding skilled workers and main reason identified behind this is
that most of child have left their school in very young age due to which their basic education
becomes incomplete and as a result of it, they are not able in adhere their responsibilities at
workplace in effective manner. Because of leaving education in earlier age, required education or
skills are not acquired by the children due to which shortage of unskilled workers are regularly
increasing in UK market and as a result of it companies of UK are paying heavy amount to the
citizens of other nations for smoothly operating their functions (Karagiannis, 2016).
Another major problem which is faced by organisations of UK are related with poor
productivity. Workers who have not skills and knowledge about the production process have
decreased the productivity of company. Due to lack of skilled workers, companies of UK are
now more investing on the technological advancement and as a result of it, cost of product of
company is regularly increasing. Whereas, if company is investing on training of their employees
then it will also increases the cost of firm because employees will take a long time period of
getting knowledge about uses of new machineries whereas, technologies will be implemented at
workplace within a smaller period of time. For providing training to employees regarding usage
of machines, management have to make heavy investments which increases the prices of
offerings of firm and as a result of it, the profit margin of company will reduced.
Most of the companies are working on labour intensive techniques and requires skilled
labour who have good knowledge of any technological advancement. For improving productivity
companies are bringing new technologies or other sources in their working activities from other
nations. Due to Brexit, labour cost is regularly increasing because of which Management of
Honda have decided to remove its business operations from UK to other nations so that quality
products can be delivered in lower prices (Honda to Shut U.K. Factory in Latest Blow as Brexit
Looms, 2019).
For understanding the result of productivity faced by organisations in UK labour market
example of Baratt homes is taken, it faces a loss of poor productivity which results in poor
profitability of firm. Main difficulties which are faced by firm is related with performance level
of its employees as it is low due to which firm is not gaining productivity as per the expectation.
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For overcome the problem of lower productivity management of company have decided to
implement new strategies so that main reason behind lower productivity can be identified. Due to
shortage of skilled labour and technological advancement workers are facing problems because
they have no knowledge about using of new machines and as a result of it company is not able in
delivering building projects to their customers on time. This all delays are faced by company
because company's employees are not efficient and skilled due to which management have
decided to make investments on training and development of their employees so that
productivity of firm can be improved (Loufrani, 2016).
An another organisation which have faced lower productivity issues is Tesco which was
occurred due to two factors. In which first one is related with enhanced level of competition in
business environment that drives managers to focus on profit maximization rather than wealth
building. Apart from that, unavailability of skilled labour workers have also increased the issues
of supply and demand at workplace. Because of this, Management of Tesco have decided to use
automatic machines at their outlets so as to surviving and making strong customer base in market
(Tesco makes UK’s first delivery by ROBOT in trial that could change shopping forever, 2017).
CONCLUSION
It has been concluded from the above report that Managing of workforce is very
important in the organisation because without their support any organisation can't take growth or
sustainability in market. This function is associated with internal functions of organisation which
includes whole selection, allocation of resources etc. that increases ability of firm so that
challenges of rivals can be faced easily. Through determining all resources, it has been identified
that human resources are very essential because they helps their superiors in completing the task
and achieving goals of firm in predetermined time-frame. Hence, managers of HR have duty to
retain their eligible or knowledgeable candidates for long period of time. Further, knowledgeable
and efficient employees are moving towards other nations which have impacted the productivity
of organisations in negative manner. In this situation, main responsibility of HR managers is to
provide training to their existing employees so that their knowledge regarding usage of new
machineries can be enhanced.
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REFERENCES
Books and Journals
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managing the human factors that could harm your business. Kogan Page Publishers.
Blandford, S., 2012. Managing professional development in schools. Routledge.
Chang, H. P. and Ma, C. C., 2015. Managing the service brand value of the hotel industry in an
emerging market. International Journal of Hospitality Management. 47. pp.1-13.
Fisher, B. A. and Uthe, R. T., International Business Machines Corp, 2019. Managing networked
resources. U.S. Patent Application 10/176. 439.
Karagiannis, D., Buchmann, R. A. and Bork, D., 2016. Managing consistency in multi-view
enterprise models: an approach based on semantic queries.
Loufrani-Fedida, S. and Saglietto, L., 2016. Mechanisms for managing competencies in project-
based organizations: An integrative multilevel analysis. Long Range Planning. 49(1).
pp.72-89.
Newenham-Kahindi, A., 2015. Managing sustainable development through people: Implications
for multinational enterprises in developing countries. Personnel Review. 44(3). pp.388-
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Shields, J., and et. al., 2015. Managing employee performance & reward: Concepts, practices,
strategies. Cambridge University Press.
Tillsley, C. and Taylor, P., 2017. 18 Managing the third age workforce: a review and agenda for
research. Ageism in work and employment. p.73.
Online
Why Amazon pays employees $5,000 to quit. 2019. [Online]. Available through:
<https://www.cnbc.com/2018/05/21/why-amazon-pays-employees-5000-to-quit.html>.
What does Brexit mean for construction. 2019. [Online]. Available through:
<https://www.designingbuildings.co.uk/wiki/What_does_Brexit_mean_for_construction
%3F>.
Honda to Shut U.K. Factory in Latest Blow as Brexit Looms, 2019. [Online]. Available through:
<https://www.bloomberg.com/news/articles/2019-02-18/honda-is-preparing-to-shut-u-k-
car-plant-by-2022-sky-says>.
Tesco makes UK’s first delivery by ROBOT in trial that could change shopping forever. 2017.
[Online]. Available through:
<https://www.bloomberg.com/news/articles/2019-02-18/honda-is-preparing-to-shut-u-
k-car-plant-by-2022-sky-says>.
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