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Human Resources Management - HRM Issues – Global Scenario

Virtual Organization - HRM Issues – Global Scenario

   Posted On :  13.06.2018 12:39 am

The emerging HR trend in virtual organizations is both a challenge and opportunity to HR experts.

Virtual Organization
The emerging HR trend in virtual organizations is both a challenge and opportunity to HR experts. The ready availability of information networks, e-mails and portable telephones is seen as accelerating the “Virtuality’ of work. A virtual organization is a network of corporations made possible by Information and Communication Technology (ICT), which is flexible and comes to meet the dynamics of the market. In this way the virtual organization gains benefit with regard to the traditional hierarchical systems. This form of organization is also called as network organization or digital organization.

The virtual organization is a social network in which all the horizontal and vertical boundaries are removed. It consists of individuals working out of physically dispersed workspaces, or even individuals working from mobile devices and not tied to any particular workspace.
The ICT coordinates the activities, combines the worker’s skills and resources in order to achieve a common goal. There is a creation of network relationship that allows for contracting, manufacturing, distribution, marketing or any other business function. In a virtual organization, a small group of executives oversee directly any activities that are done in-house and coordinate relationships with other organizations.


Characteristics of virtual organization are

Power flexibility

1. Informal communication

2. Flat organization

3. Multidisciplinary teams

4. Goal orientation

5. Dynamics

6. Homework

7. Customer orientation

8. Sharing of information

9. Vague organizational boundaries.

The driving force in a virtual organization is basically the virtual team. Every organization requires a team to carry over the activities in an orderly fashion, and such a team also exists in a virtual organization. In a virtual team, members’ primary interaction is through some combination of electronic communication system to tie up with dispersed members who never or rarely come face to face. Here people communicate online using links like WAN, videoconferencing and e-mail.

The concept of virtual teams has gained considerable attention in recent years. Within global organizations, the virtual team involves collaboration and teamwork between a temporarily separated workforce. Such collaboration may also extend beyond the organizational boundary, linking partners in joint ventures and contractors who are in various locations. Virtual team working is potentially necessary for global organizations. It requires trust relationship. Personalized trust relationships are essential for continuous virtual team working. Such personalized trust relationships are normally established through face-to-face interaction and socialization.

The differences of virtual teams from face-to-face teams are

1. Absence of Para- verbal and non-verbal cues.

2. Limited social context.

3. Ability to overcome time and space constraints.

Emerging Hr Issues In Virtual Organization

The HR issues such as recruitment and socialization process are forms of managerial control. These inputs control and regulate the antecedent conditions of performance, ensuring that the employee’s skills knowledge, attitudes values and interest match those of employing organization.
In a virtual organization there are loose organizations of highly proficient people who are left to “do their own thing” in order to produce world beating products or services. The shift towards virtual organization is associated with a fundamental realignment and reordering of jobs. Knowledge-based jobs are assumed to require greater skills, have greater variety and offer more potential for a high quality of work life (QWL).
The positive side in virtual job is greater job autonomy and more financial stability, free transport, free lunch and clothing. The negative side is increased working hours, work-related stress and changed social relationship. Highly skilled workers are needed. Jobs are variable and short term. People should be multi-skilled.

HR Issues

1. Recruitment is conducted under time pressure and requires high performance.

2. Human capital (Knowing one’s job) and social capital (Knowing each other) become inextricably linked.

3. The formation of some stability in social relationship is not very much required.

4. Work place is variable.

5. Idleness is shown in terms of learning by watching what others do. Master-apprentice relationship and craft-based learning techniques become important.

6. Job status and project feedback is very short. Hence virtual organization requires a heavy investment to create systems and staffing structures.

Performance Management

1. Performance should be defined. Each member or team must have a clear idea of what he is supposed to do.
2. Managers have to eliminate any obstacle that comes in the way of successful functioning of the organization. To do this they have to provide adequate resources and also carefully select his employees.

3. Motivation is an essential ingredient in improving the performance of any worker. Performance can also be increased by providing rewards.

Selection Process

Selection is an important factor that relates to discovering the applicant’s potential for the desired responsibility. The requirements for working in a virtual organization area

1. Familiarity and comfortability with the job.

2. Self-motivation.

3. An effective communication both oral and written.
4. Adaptability.

5. Knowledge about organizational procedures.

6. Technical self-sufficiency.

7. Result – orientation.

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