Advances and Challenges in Human Resource Management in the New Millennium

By Chiavenato, Idalberto | Public Personnel Management, Spring 2001 | Go to article overview

Advances and Challenges in Human Resource Management in the New Millennium


Chiavenato, Idalberto, Public Personnel Management


The world of human resource management is changing more rapidly than we can imagine. Constant environmental changes mean that human resource managers face constant challenges. They must respond by taking advantage of gradual yet profound changes in the nature of the field, current practices, and overall human resource management policies, mission and vision.

Two stories will illustrate our topic and its importance. The first one is from Japan. The Japanese Minister of Industry and Commerce predicted that in the next five years three quarters of the Gross National Product (GNP) of Japan would come from products and services that, up to now, had even not been invented. Think of it -- in only 1,825 days, the future of the Japanese economy will be shaped by new technological innovations that we are now totally unaware of. Japan's situation is not unique. What happens there is also happening in the rest of the world. While the amount and rate of change are unprecedented, they become more significant when viewed in the context of education. When today's students finish school, the job market will have a completely different profile than today. Will these students and universities be prepared?

The second story comes from Sao Paulo, Brazil. In the first semester of 1999, the Catho Institute (a professional outplacement center) worked with about 850 executives who had, for various reasons, been released by their employers, and now wanted to re-enter the labor market. Half were placed in other companies, though in many cases with different salaries. But the other half is still waiting for work. And they may have to wait a long time, for the characteristics of this group are troubling. Eighty percent had not read even one book in their area of specialization in the past 12 months.

Ninety percent had not attended any job-related training program, seminar or workshop. Seventy-five percent don't understand computers; 70 percent do not speak another language (such as English, French or Spanish). The forecast is that it will be difficult for anyone in this group to get a job at the level that they had before.

What do these two stories have in common? It's very simple -- we're at the threshold of the new millennium. The world is changing quickly and relentlessly, and many do not know it. They're simply being marginalized, left out of the job market, sitting on the sidelines as opportunities pass them by.

How does this reality affect what contemporary human resource managers need to learn to be competent professionals tomorrow? The challenges posed by the new millennium are so complex as to make simple and objective responses to this question difficult. But some trends help answer it -- or at least reduce our uncertainty about the future. In fact, the emergent business environment generates 14 major challenges for HRM professionals. Let's examine each in turn.

Challenges For Human Resource Management (HRM)

From the Industrial Age to the Information Age. Work performed in factories by machines is being replaced by work in offices or at computer terminals. And instead of working with things, people increasingly work with ideas and concepts. Information and knowledge have replaced manufacturing as the source of most new jobs.

From Restricted Markets to Globalization. Our old local regional vision is giving way to a new global economic order and business vision. The new demand is think globally and act locally. We are also used to dealing with restricted or concentrated markets. We need to become accustomed to dealing with business from a new global perspective.

From Bureaucracy to Adhocracy. The rigid organizational hierarchy with its monolithic chain of command is giving way to integrated team networks based on autonomy and flexibility. Rigid departmentalization is being replaced by flexible organizational structure -- business units and profit centers that change rapidly. …

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