The paper "Workplace Management Dynamic - Australian Industry Skills Councils " is a perfect example of a management case study. The Australian Industry Skills Councils (2011) reported that approximately one half of all working-age Australians had insufficient language, literacy and numeracy skills to participate in training programs required for key professional occupations or trades such as engineering, electrical and plumbing. These findings point to a challenge facing businesses and firms in competitive environments, that of an apparent skills shortage in the labour supply which makes it harder for businesses in competitive industries to cope with the demands of changing business environments.
This essay discusses this contemporary challenge facing businesses or firms in competitive environments- skills shortage in labour supply-in relation to the four goals of employers in HRM in competitive environments as discussed by Boxall (2007). Boxall (2007) argues that in competitive and changing environments, there are four fundamental economic and socio-political motives or goals for employers. Firms should pursue cost-effectiveness within their industrial context while simultaneously ensuring that they achieve some level of social legitimacy in the societies they operate in.
furthermore, firms also need to develop both short-run and long-run flexibility in HRM in addition to their managers securing sufficient autonomy or managerial control to be effective in changing business environments. This essay explores each of these four employer’ s goals as discussed by Boxall in relation to the contemporary challenge of skills shortage in the labour supply. The essay discusses the implications of skills shortage in labour supply on each of the four goals, identifying the challenges posed and identifying the links between these goals and some of the strategic tensions and problems faced by managers in managing change.
The essay will briefly discuss each goal. Critical analysis of these goals with respect to the challenge reveals that the skills shortage compromises employer’ s cost-effectiveness and constrains the firm’ s flexibility. The skills shortage also poses legitimacy problems for employers in terms of affirmative action since they have to source for labour from demographic groups with lower LLN skill levels. The skills shortage in the labour supply also erodes managers’ autonomy and their power to act and become effective in managing to change their firms due to unpredictability and constraining their planning which may complicate their efforts.
In conclusion, it will be argued that the skills shortage compromises the achievement of employers’ goals as indicated by Boxall. Cost-Effectiveness The primary problem or principal economic objective of firms in competitive environments is to secure their economic viability (Boxall 2007). Therefore, the main economic goal of HRM in competitive environments is to ensure that firms remain competitive by making labour productive at a reasonable cost which in turn ensures the viability and profitability of the firm in its industry.
The basic problem is to identify which HR system is most cost-effective or profit-rational in the specific market context (Boxall 2007). For many businesses, this may imply labour cost minimization through lower wages since labour costs are essential to the firm’ s survival. However, in other industries, higher HR investment is required. In competitive environments, labour productivity remains essential to cost-effectiveness. A key aspect of labour productivity is labour supply skills, which essentially implies that language, literacy and numeracy skills in the labour supply are vital for the achievement of employer’ s economic goals in terms of cost-effectiveness (Snell and Bohlander 2012)
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