A Study on Employee Experience, Perceptions and Expectations about Human Resource Professional s Role as Change Agents

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1 1 A Study on Employee Experience, Perceptions and Expectations about Human Resource Professional s Role as Change Agents Rahul Agarwal, Assistant Professor, AMITY Business School, AMITY University Rajasthan ABSTRACT Today s continuously changing and highly competitive environment has necessitated business leaders to persistently adapt and align strategy, structure, culture, people, policies and procedures to cope up with the new challenges of business and create sustainable competitive advantage and, in turn, market leadership. It s worth mentioning that the organizations are forced to do this on a continuous basis at a faster rate than ever. And hence, Human Resource professionals can play a key role in building people systems to support organizational change as such activities are centred on people. This study focuses on assessing employee perceptions, experience and expectations about role of HR professionals as change agent. A questionnaire was administered on 196 respondents across different functions, sector and experience. Analysis revealed that business managers believe that HR professionals are not playing the role as change agents as they are supposed to. Further there were four important dimensions of the role of HR professionals as change agent. HR professionals need to be proactive, able to build credibility, facilitate change and nurture culture in order to be change agent. Keywords: HR Professionals, Change Agents, Perception of HR Professionals, Employee Experience INTRODUCTION There has been a growth on the research in the area of Change Management and the critical role of HR in managing change. However, studies on what role HR should play and actually plays in organizations to handle change, whether they have been successful, whether organizations acknowledge that HR and HR policies in their organization plays an important role to manage change are quite limited. Therefore, studies on expectations and experiences of organizations from HR during change and how HR can help organizations to manage change is a largely unexplored area. Organizations across the globe have undergone massive changes over the last decade in terms of technology, infrastructure, market, economy, customers and workforce demographics and this stands true for the organizations in India too. However no study has been carried out on challenges faced by Indian companies in managing these changes with a micro focus on the role of Human Resources department in managing change in Indian context. Researchers believe that context is a very important parameter for learning. Thus it is thought important to do such a study which will help companies in India to clarify and understand the role of HR in and understand that how HR can add value to organizations during change. This would in turn help organizations to improve overall efficiency, effectiveness and get a competitive edge over others. LITERATURE REVIEW As all change initiatives are cantered on people role of Human Resources function plays an important role in managing change (Ulrich, 1997). Human resource is one of the key factors in determining organisational coping and profitability (Tiong, 2005). The capability of organisations to achieve change is, to a large degree, determined by the attitude of the staff - the human resources of the organisation - to respond to and adapt to change. People can be either the major obstacle to change or the major success factor (Smith, 2004). As organizations of all kinds face unrelenting changes in their environment, the need for HR to provide leadership, develop necessary capabilities and implement change is necessary (Ulrich, 1996). Managing change is the most important competency for success of any HR professional (Brockbank 1999; Hewitt Global Survey 2009). HR professionals have been slow to embrace the new roles particularly when it comes to creating an adaptive culture with a capacity for rapid change. (Ulrich, 1996). Poon and Rowley (2010) state that HRM change pace in Asia were slow and sporadic. Adjustments in HRM practices were done more at a surface level. It was also unclear that which HRM elements were altered and how it impacted the transformation process. The need for a comprehensive HR strategy to manage those who manage change is long overdue (Doyle, Mike 2002). There were a number of inconsistencies and ambiguities in the area of HR strategies, policies and approached as they directed at and affected employees involved in managing change. (Doyle,

2 2 Mike 2002). Flannery et al. (1996) reported that line managers saw HR as a non-player in the change process, and a hindrance to effective organisational change, as they had no understanding of the strategic management issues. HR can contribute in change management programmes. HRM and change models suggest that they are interrelated. The different approaches to HR could be categorized into soft model which considers vital need to integrate policies with objectives of business treating employees as important and the hard model which considers that HR policies, systems and initiatives should be closely integrated with business strategy. These models are compatible however there are tensions between them. Employment relationship and organizational context will define the role of HRM in managing change (Farquharson & Baum, 2002). (Ogilvie and Stork, 2003) review the history of roles played by HR professionals starting from 1800s and conclude that HR has undergone varied tensions around what role it has in managing change and whose interest it should represent. The researchers argue that due to these tensions very often HR has played a reactive role trying to bring greater fit and stability by catering to the interest and issues of different constituencies as the sources of pressure changed. Researchers highlight that traditional HR tried to improve fit between work, worker, supervisor and organization. Strategic HR tried to improve fit with management and other researchers encouraged HR to bring more balance by treating employees as important stakeholders. Researchers successfully argue that this has led to conflicts in HR values, expectations and allegiances. In this context researchers highlight that various groups like workers, managers and stakeholders must consider each other s preferences as they make decisions and plan action and further recommend the role of HR as a negotiator and consider it most appropriate as it calls for facilitating, advocating and addressing collective interest. A comparison of role of HR professional as change agent right from 70s onwards till 90s highlights that the change agent role has grown in significance and complexity. A fourfold typology of role of HR as change agent is champions, adapters, consultants and synergists. The role of HR as change agent is critical and cannot be separated from proactive agenda of HR. The role of a change agent is highly complex and calls for changing roles via a vis organizational changes (Caldwell, 2001). To add value and enhance organization s competitive advantage HR needs to move from being reactive to becoming proactive. HR should move away from being operationally reactive and become strategically reactive by integrating HR initiatives with business strategies, creating culture of execution and crafting techniques and processes for managing change. HR can become strategically proactive by fostering innovation and creativity, facilitate merger and acquisition and lead in creating linkages between market requirements and internal capabilities (Brockbank, 1999). Organizational changes can lead to greater competitive advantage if the human resource potential is maximized during change. Organizations should take into consideration employee well being which will reduce employee stress, motivate them to work efficiently, engage them positively and create organizational loyalty. Tiong (2005) conducted a survey to capture employee perceptions and through the findings of the survey suggests that through communication, supervisor and peer support, employee empowerment for active execution, training and educating employees to cope with stress and involving employees organizations can create greater buy in for change and maximize human potential. Poon and Rowley (2010) stated that HRM change pace in Asia has been slow and sporadic. Adjustments in HRM practices have been done more at a surface level in the past. It was also unclear that which HRM elements were altered and how it impacted the transformation process. Various models and theories of change provide a compartmentalized view and produce isolated lines of research. Integrating different theoretical perspectives can better explain aspects of change context. The literature review clearly suggests that though HR sure has a very vital role to play as a change catalyst however organizations feel that HR hasn t contributed much in this area. Either the HR professionals are caught within serving expectations laid down by various stakeholders or they are caught in rolling out policies and programs merely at surface level. It was thus felt necessary to take an empirical view of how HR professionals feel they are performing as a change agent. Literature review also showed gaps in perception of employees and HR in terms of role Human Resource function played during organizational change. Thus a comparative view of employees and HR perceptions about the role of HR in managing change deemed necessary through empirical research. SOME KEY STATISTICS According to PWC survey on Global HR Challenges: Yesterday, Today and Tomorrow, change management was seen as the greatest challenge (48%) by them however when they were asked how HR professionals spend their time it was observed that just under one fifth of the time (19%) was devoted to being a change agent. According to the Hewitt Global HR Survey 2009 study, one of the most critical capability gaps amongst HR (51%) and CEO/ Business leaders (41%) is ability to manage change. According to Aligned at the top survey report conducted by Deloitte and Economic Intelligence Unit

3 3 2007, the strategic people agenda is not being addressed by HR. Over 60% of respondents said that they rarely or never consider HR for mergers and acquisitions. A study conducted by consulting firm Deloitte Touche Tohmatsu and The Economist Intelligence Unit jointly in 2007 confirmed that the HR is not viewed as a key to people strategies by business leaders. Less than a quarter of corporate leaders believe that their HR departments playing a crucial role in coming up with a strategies having significant impacting operational efficiencies. But at the same time they believe that people are key player in determining a company s market value. However, about half of HR leaders believe they are major contributors in shaping a company s culture. According to a 2006 Economic Intelligence Unit Survey only 11% of respondents were satisfied with the performance of HR in improving adaptability of the business to new situations. This may be the reason why most often business leaders maintain a very narrow outlook towards HR professionals (Pfau and Kay, 2002). However HR professionals solely are not responsible for their narrow image. According to Beer et al., (1984) top management often judges HR professionals credibility by assessing their ability to perform administrative activities successfully and do not understand how HR professionals can play strategic role to drive organizational excellence. Too often HR professionals are given the title of strategic partners which means working with general managers to implement strategy (Brockbank, 1999; Ulrich 1996). Thus there are significant differences in perception between employees and HR professionals in terms of HR s role as a strategic partner (Walters Gerrit, 2006). While both employees and HR professionals understand the need for HR professionals to drive change however there is still a huge gap between what HR delivers in terms of change management initiatives and what the employees perceive, expect and experience from HR professionals during organizational change process. It is important to identify this gap and plug it appropriately for HR to become a true change agent. OBJECTIVES 1. To assess employee perceptions and expectations from HR during organizational change 2. To identify which factors play most significant role for HR professionals to become a change agent 3. To identify the role of HR as change agent and future opportunities and challenges METHODOLOGY This section describes the methodology used to examine the experience, expectation and perception of employees about role played by Human Resource function during organizational change. This section provides details about sample selection, sampling technique, instrument, data collection technique, and data analysis procedure. SAMPLE SELECTION 196 employees working in different organizations and different functions such as Finance, IT, Marketing, Sales and Human Resources were asked to complete the survey. The study provided an opportunity to gather perceptions of employees working at different levels and roles within the HR function and line management during organizational change. Limited amount of research has been done on comparative view between HR function and line management about their experience, expectation and perception during organizational change. Sample 1. Size The sample size consisted of 98 line managers working in different functions such as Marketing, IT, Sales, Finance, Consultants etc. This together formed the sample of line managers. Sample size further consisted of 98 HR professionals working specifically in the HR function. Therefore the total size of the sample was 196. The respondents were from Delhi NCR working in mid level to senior level roles. 2. Sampling Technique Convenience sampling was used as it is commonly used in an exploratory study like this where researcher is interested in getting an inexpensive broad approximation of truth (Strauss & Corbin, 1997). This method is commonly used in practical settings as while studying behaviours of human beings the researcher seldom finds an ideal environment for carrying out the research (Miles and Huberman, 1994). Due to the wide coverage of different levels of employees and different sectors the survey results are believed to be generalized to broader population. SPECIFICATIONS USED IN CONVENIENCE SAMPLING While doing convenience sampling care was taken to ensure the following: 1. Respondents having minimum three years and above of continuous experience in an organization were asked to respond. This was because employees would need minimum three years to understand their organization s dynamics and form a holistic opinion about the services provided by the HR function of their organization. Minimum three years would be required to gain comprehensive knowledge about the aforementioned areas.

4 4 2. Employees in the age group of 30 years and above were only taken as these were experiences employees having clear understanding of change process, change dynamics, positioning of HR function to play the role of change agent and future opportunities. 3. Diverse sectors were used for a more generalized view and to get a fair view of perceptions about HR function. RESEARCH APPROACH Quantitative study was used to test HR variables in an objective manner (Creswell, 1994) to determine the differences of perceptions of HR services during organizational change. This approach was found appropriate to identify the current status of role played by HR function during organizational change and how it varied from the HR professional s views vis-a-vis line manager s view. Views of employees at different levels could also be compared and a sector wise comparison could also be made. This is an exploratory study. Exploratory study is considered appropriate when the researcher seeks to investigate little understood phenomenon (Marshall and Rossman, 1999). In order to understand the demographical characteristics of the data Descriptive Analysis was done. The Sector wise Disposition of Respondents: Sector Frequency Percentage IT BFSI BPO Telecom Manufacturing 18 9 Pharma 14 7 Retail 14 7 Hospitality 10 5 Aviation 8 4 Consultancy 6 3 Real Estate 5 3 Travel & Tourism 3 2 Total Maximum number of respondents were from IT sector (21%), followed by BFSI (19%), BPO (10%) and Telecom (10%) which meant 60% of respondents were from IT, BFSI, BPO and Telecom sector. Other sectors like Manufacturing, Pharmaceuticals, Retail, Hospitality, Aviation, Consultancy, Real Estate and Travel and Tourism had at least 2% of representation. Experience wise Disposition of Respondents Age group Frequency Percentage 3 to to to to & above 17 9 Total

5 5 Maximum respondents had an experience of 6 years to 10 years (44%). All the respondents were experienced and almost 20% were handling senior management roles. Experience between 3 to 5 years and 6 years to 10 years signified mid level managers, 11 years to 15 years, 16 years to 20 & above category represented respondents handling senior level management roles. Age wise Disposition of Respondents Age group Frequency Percentage years years years years years & above 7 4 Total Maximum number of respondents were within the age group of years (54%) followed by respondents between the age group of years. 19% of the respondents were above 40 years of age. Perception HR and Line The Mean scores of perception of HR and Line against each item is listed below: HR Code Statement (Perception of HR and Line HR shows leadership by initiating transformation first within the HR 1 function HR demonstrates understanding of the theory and tools of change (provides a model of change that can be used throughout the 2 organization) HR plays a leading role in communicating about change Line

6 6 HR Code Statement (Perception of HR and Line HR ensures effective evaluation of employee's readiness to deal with 4 change HR proactively takes the lead in change projects HR serves a facilitator in change projects HR provides continuous support to employees during change projects HR demonstrates understanding of business HR professionals have skill and knowledge to deliver services during change management 4.9 HR professionals have the ability to manage change (project management knowledge and skills/ability to facilitate the sharing of knowledge across departmental boundaries) 4.7 HR professionals have the knowledge of organizational culture (understanding of the role that organizational culture plays in the change process/ knowledge and skills to put specific problems in context of larger system 4.5 While managing organizational change HR professionals live 12 organizational values and build relationships 4.9 As change agents HR professionals demonstrate the ability to manage 13 conflict As change agents HR professionals establish trust and credibility with 14 others HRM participates in defining organization s change issues HRM explains why change organization must change HRM defines the organization s status after change HRM participates in reviewing previous change implementation 18 strategies to determine which have been effective HRM participates in removing historical barriers HRM participates in identifying the change implementation approach HRM addresses social and psychological impacts to create 21 organizational commitment to change HRM identifies key people at all levels of the organization who would 22 drive change HRM participates in identifying and preparing the change agents HRM develops strategies to counteract resistance to change HRM participates in developing means to manage organizational culture HRM overhauls the reward structure during times of change HRM align strategy and structure during change HRM monitors organization s performance during times of change HRM build channels for informal communication HRM motivates people to manage change HRM provides rewards and recognition to accelerate change HRM eliminates rewards that support undesired behavior HRM helps create channels to celebrate successes HRM provides proper level of resources to manage change HRM frequently communicates during change HRM establishes proper channels of communication during times of 36 change HR helps the organization adapt to change through technology 2.7 HR participates in shaping culture change for renewal and 38 transformation HR makes sure that HR processes and programs increase organization s 39 ability to change by leveraging technology HR effectiveness is measured by its ability to help an organization 2.4 Line

7 7 Code Statement (Perception of HR and Line HR Line anticipate and adapt to future issues. 41 HR is seen as a change agent 2.7 HR spends time on supporting new behaviors for keeping the firm 42 competitive HR is an active participant in organization renewal, change or 43 transformation HR works to reshape behavior for organizational change HR develops programs and processes to help the organization transform 45 itself by using appropriate technology HR s credibility comes from making change happen The mean scores show that HR professionals rate themselves highly in terms of effectiveness of their role as change agent however the line managers experience has been much lower. This means that HR policies and practices adopted to help organizations manage change is not being appreciated by the employees or line managers. Interestingly both HR and Line feel that HR s credibility comes from making change happen. This further puts pressure on HR professionals to understand the organizational and employee needs during organizational change and manage change effectively. Further, Factor Analysis was done to see if there was correlation between 46 items and if the similar items could be clubbed together. The results of the factor analysis are as under: Factor Analysis KMO and Bartlett's Test Kaiser-Meyer- Olkin Measure of Sampling Adequacy. Bartlett's Test of Sphericity Approx. Chi-Square df 1035 Sig. 0 KMO score is greater than 0.5 and therefore factor analysis can be used as an appropriate technique to find out the correlated items. Factor Analysis showed that there were 7 factors which explained 70% of variation. The total variance explained table is as under: Initial Eigen values Extraction Rotation Total Sums of Sums Variance Squared Squared Explained Loadings Loadings of % of Cumulative % of Cumulative % of Cumulative Component Total Variance % Total Variance % Total Variance % As observed the first factor explained 51.8 % of variation. Factor 2,3,4 and 5 explained approximately over 3% of variation. Therefore Factor 1 emerged as a very strong factor. The rotated component matrix table was used to club the factors. The factors were clubbed and named as under and their respective dimensions have been mentioned: Factor 1: Being proactive Leadership Communication Understanding of business Knowledge and skills of managing change Providing support Programs and policies aligned to change Factor 2: Demonstrating credibility Leading by example Reshaping behaviour Trust and support Factor 3 & 4: Facilitate change Anticipate future Continuous adaptation HR policies and practices to manage change

8 8 Factor 5&6: Culture Nurturer Reshaping behaviour Supporting culture Factor Analysis showed that HR can play the role of change agent if it is proactive, demonstrates credibility, facilitates change through HR practices and policies aligned to the changing needs and nurture culture. CONCLUSION The research suggests four important aspects of role of HR as change agent. Being proactive, building credibility, facilitating change and nurturing culture are the most important aspects of managing change. Each of these factors has specific dimensions which have been mentioned in this paper. This study can help companies manage change better by keeping employee expectations at the core which in turn will help organizations create a positive employee perception about change which will contribute in successfully implementing change. REFERENCES [1] Beer M., Spector, B., Lawrence, P., Mills, D. and Walton, R.E. (1984), Managing Human Assets, The Free Press, New York, NY. [2] Brockbank, Wayne. (1999). If HR were really strategically proactive: present and future directions in HR s contribution to competitive advantage. Human Resource Management, 38(4), [3] Caldwell, Raymond. (2001). Champions, adapters, consultants and synergists the new change agents in HRM. Human Resource Management Journal, 11(3), [4] Creswell JW (1994) Research design: Qualitative and Quantitative approaches. Thousand Oaks CA: Sage [5] Doyle Mike. (2002). From change novice to change expert, issues of learning, development and support. Personnel Review, 31(4), [6] Farquharson, Lois., & Baum, Tom. (2002). Enacting organizational change programmes a centre stage role for HRM. International Journal of Contemporary Hospitality Management, 14, [7] Flannery, T.P., Hofrichter, D.A., Plannen, P.E. (The Hay Group) (1996, People Performance and Pay, Free Press, New York, NY. [8] Lawler,Edward E., I.,II, & Mohrman, S. A. (2003). HR as a strategic partner: What does it take to make it happen? HR.Human Resource Planning, 26(3), [9] Marshall, C. & Rossman, G.B. (1999). Designing qualitative research (3rd ed.). Thousand Oaks, CA: Sage [10] Miles, M. B.; E Huberman A. M. Qualitative data analysis: an expanded sourcebook. 2nd ed. Newbury Park: Sage, 1994 [11] Ogilvie, John R., & Stork, Diana. (2003). Starting the HR and change conversation with history. Journal of Organizational Change Management, 16. [12] Poon, Irene, & RowleyChris. (2010). Change in Asia a review of management theory and research related to human resources. Asia Pacific Business Review, 16, [13] Pfau, & Kay. (2002). The Human Capital Edge. McGraw-Hill. [14] Smith, I. (2004). Continuing professional development and workplace learning 7: Human resource development - a tool for achieving organisational change. Library Management, 25(3) [15] Strauss, A.L. and Corbin, J.M. (1997). Grounded Theory in Practice. Thousand Oaks, CA: Sage [16] Tiong, Tan. (2005). Maximizing Human Resource potential in the midst of organisational change. Singapore Management Review, 27(2). [17] Ulrich Dave. (1997). What is change agent role. Harvard Business Review. Websites: 1. Hewitt s 2009 Global HR Study accessed on f 2. maywfpmahrglobalchallenges%5b1%5d.pdf 3. Austria/Local%20Assets/Documents/HCAS/Organi sationtechnology/hr_strategy_pov.pdf issertation.pdf?sequence=1 ABOUT THE AUTHOR The author is working as Assistant Professor at AMITY Business School, AMITY University Rajasthan. He has a rich work experience of more than 12 years of working in both corporate world and the field of academics. After his PGDITM from Alliance Business Academy, Bangalore he worked as Branch Manager at ICICI Bank and after a 5 year long successful career he opted to move to academics due to his sheer interest in the area of Human Resource Management. He is currently pursuing Ph.D. in the field of HRM. Apart from teaching he is also interested and engaged in imparting communication, business etiquette and personality development trainings. He is also passionate about painting, photography, sports, cooking and gardening. He has always been a front runner and bagged many awards and accolades during his academic and professional career.