The role of Human Resource Management and the Human Resource Professional in the new economy

Abstract

The world economy is currently dominated by information- and communication technology, and has consequently become increasingly competitive and globalised. The changing economy also impacts on our living and working environment. A qualitative approach to research was followed in examining the implications of the changing economy on the field of human resource management, with the objective of developing a model for describing the role of human resource management in the new economy. The qualitative analysis focused on the most recent publications in this regard and it is apparent that the changing economy has a direct and definite influence on the role of human resource management in organisations. All human resource management practices will have to change dramatically to answer to the demands of the new economy. Important concepts relating to the new economy and included in the model are intellectual capital, human capital, knowledge management, the internet, e-commerce and globalisation. Whereas the competitive advantage for organisations in the old economy centred on financial capital and technology, the emerging economy necessitates an emphasis on investment in human capital, knowledge, and the commitment and enthusiasm of the employees. The focus in the business world has shifted from physical assets to knowledge and information, i.e. intellectual capital. The effective management of human and intellectual capital poses new challenges in the organisation for leadership and managerial capabilities. The model that has been developed to describe the role of human resource management in the new economy focuses on the integration of intellectual and human capital and information management in the human resource strategy of the organisation. The content validity of the model was determined according to Lawshe’s technique, using an evaluation panel. The panel consisted of eleven individuals, all with a sound knowledge of the new economy as well as the field of human resource management. Four panel members have Doctorate degrees and seven have Masters degrees in Human Resource Management. A total content-validity index of 0,89 was obtained, indicating that the model is acceptable and valid. The model emphasises the fact that the human resource management function in an organisation has to utilize the drivers of the new economy, i.e. internet, globalisation and e-commerce. The model also indicates how these aspects are to be utilised in the human resource practices of selection, placement, training and development of human potential. In the last instance the model focuses on the implementation of a people-oriented strategy that will address the effective management of intellectual capital, human capital and information management. Copyright