In meeting the demands of a global economy, technological advancements especially in the field of telecommunications and information technology are key factors in making possible various transactions faster, cheaper, more reliable and convenient. Needless to say, these technological advances are important tools if companies and other business ventures are to survive in the digital economy.
These technological advancements however, are evolving far too fast which consequently generate pressing problems that ought to be considered. On a preliminary note, the aforementioned rapid technological evolutions pose serious questions if our societal structures can rapidly adapt to these changes and more importantly, if we, ourselves can rapidly adapt and be able to integrate for ourselves these changes.
In line with this, what follows is a discussion of how such changes affect the global economy. Within this context, the task of this paper is to discuss the effects of work transformation in society with a particular emphasis on how it affects the people management systems around the world.
Weick and Quinn (1999) contend that changes in the organization of work within societies may either be characterized as “discontinuous and episodic” or “continuous and emergent” (p.361).
The difference between the two lies in the emphasis on intentionality, planning, management control, and specific outcomes in the former and the emphasis on improvisation, spontaneity, and ongoing action in the latter. The two perspectives stated above have a direct effect in the formation of an organizational framework. This is another way of saying that the manner in which organizational change is perceived supports an appreciation of the multidimensional nature of organizational phenomena.
The organization of phenomena stems from the human need to conceptually order reality. Such a process is ensured through the creation or adoption of a language that may account for the reality perceived by the individual or by the social group. The importance of such a process stems from its issuance of a fixed and thereby more manageable reality.
Such a reality, however, is continuously distorted due to the steady input of new forms of conceptualizations that also opt to enable the manageability of reality. Such a process is apparent within the business sector in the gradual shift from an information-based economy to a knowledge-based economy.
The later form of economy recognizes that knowledge occupies a focal point in relation to the function of society. As a result of this, organizations became increasingly aware of the need for a ‘knowledge focus’ in their organizational strategies as they respond to changes in their environment. ‘Knowledge focus’ refers to the deobjectifcation of knowledge in favour of the codification of knowledge into systems (Bell, 1999, p.x).
Within such an economy, organizational actors and the complex social interactions that take place amongst them recreate organizations through the continuous process of change. According to Tsoukas and Vladimirou (2001), what makes knowledge organizational is it codification in the form of propositional statements set within a group’s collective understanding (p.974). It is important to note that such a process of knowledge codification requires the existence of local knowledge. Within an organization, such forms of local knowledge are evident in the company’s culture; the development of such is dependent upon the existing organizational framework.
Such a point brings to focus one of the main elements of the labour market that determines the existing workforce’s productivity and performance within a particular society. The reason for such a focus is evident if one considers that the current shift in economy [from an information based economy to a knowledge-based economy] gives precedence on the role of the members of the workforce in the maintenance of an organizations overall knowledge based culture.
In line with this, Davinport (1999) contends that such a culture necessitates a new mode of framing the human capital. According to Davinport, it is time to conceive of workers “not as human capital but as human capital owners and investors” (1999, p.7). Davinport argues that such a conception is not entirely new since it echoes the conception of the employee as an asset.
The difference of such a view stems from the conception of the worker as the owner of the capital since workers are the ones who decide in which field they will contribute the specific talents and expertise they possess within the current market. The organization’s role thereby is fixed to the extent that its main role lies in utilizing and developing the skills offered by the member’s of their workforce. Organizations must thereby adopt new working practices or upgrade workplace skills.
An example of this is evident in the content of the Chartered Institute of Personnel and Development (CIPD) of the United Kingdom which states that “in a mass customisation environment, where systems of production and distribution are readily imitated and leapfrogged, organisations must therefore continually invest in physical and human capital to keep ‘ahead of the game’”(2001, p.10).
As a result of the above stated paradigmatic shift from an information-based economy to a knowledge based economy certain developments occurred within the economic, political, and technological fields. Such developments are evident in the increase in business competition and the advent of information technologies (Weatherly, 2003, p.2).
Political and economic developments are evident in the increase in business competition which is a result of the globalization of trade and key economic sectors [e.g. telecommunication, electricity, transportation, financial services]. Technological developments, on the other hand, are evident in the advent of information technology which can best be seen through the continuous popularity and easy accessibility of the internet.
According to Lev (2001), such developments within the above stated fields have dramatically changed the structure of organizations to the extent that intangibles [human capital] became the major value drivers of business within developed economies (p.8-14). The reason for this is evident if one considers that from a strategic perspective it has been noted that “fully one-third of the information used to justify the investment decision is non-financial” (Ernst & Young, 1997, p.10).
Examples of such factors are “quality of management, effectiveness of new product development, strength of market position, strength of corporation culture, and effectiveness of compensations policies” (Weatherly, 2003, p.4). Such factors have an overall link to business systems since they are partially if not fully determined by the company’s culture maintained by its overall organizational framework. Furthermore, since the above stated factors are considered in the determination of investment decisions, it also follows that they have a direct effect in terms of the economic conditions of a business organizations and hence the economic side of society as a whole.
As was stated above, one of the defining factors of the current paradigm shift within the market can be traced from the shift of importance from the tangible assets to the intangible assets.
Tangible assets consists of financial assets [financial capital] and physical assets [e.g. property, equipment, and other furnishing] whereas intangible assets consists of intellectual capital [e.g. patent formulas and product designs] and human capital. The focus of this paper from the onset has been to lay down the current transformations of work in the period of globalization. What follows is the specification of how these changes have affected society at large.
In Work, Self, and Society, Catherine Casey specifies the manner in which changes in work have affected society. Casey (1995) argues that the current conception of work which is defined by the effects of industrialization has turned the worker into a product or a commodity of the market. She states,
The convergence of work and virtue (through methodical adherence to one’s ‘calling’)…set in place a type of citizen-worker that would subsequently come to typify modern forms of social organization. In modern society people have defined themselves and in turn have been socially defined, by the type of work that they do in the public sphere. (1995, p.28)
In other words, the results of industrialization have led to the commodification of the individual as the individual derives his value from his work. The manner in which this is enabled is further evident in the current shift from an information based economy to a knowledge based economy as the value of the worker is considered to be dependent upon his knowledge. This shows how the nature of work within a post-industrial society has changed to the extent that the market has become dependent upon the mental labour and the mental knowledge of the worker [mental labour is considered to be the core of industrial activity] (Lawson, Jones, & Moores, 2000, p.99).
To a certain extent, one might note that this may prove to be beneficial for individual societies since the aforementioned paradigm shift has enabled the development of regional specialties and economies. Sabel (1999) states that the changes in the work paradigm within the post-industrial society has led to the development and growth of “twentieth century variants of industrial districts in Italy, West Germany, Japan, Denmark, Austria, France, and the United States” (p. 243).
Such an assumption however may be considered as the result of a form of hasty generalization since although such developments have enabled organizations around to world to place greater focus upon the members of the workforce as well as upon the development of industrial districts around the world [the development of such is expected to pave the way for the industrialization of all countries and hence the development of these countries] such developments still place the worker in a disadvantaged position as he remains to be a commodity within the market whose value is dependent upon what the work system prescribes.
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Casey, C. (1995). Work, Self, and Society: After Industrialism. London: Routledge.
Chartered Institute of Personnel and Development, 2001. Raising U.K. Productivity: Why People Management Matters.
Davenport, T. (1999). Human Capital: What It Is and Why People Invest. San Francisco: Doubleday.
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Lawson, T., M. Jones, & R. Moores. (2000). Advanced Sociology Through Diagrams. Oxford: Oxford U.P.
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Sabel, C. (1999). Flexible Specialisation and the Re-emergence of Regional Economies. Modernity: Critical Concepts Ed. M. Waters. London: Taylor & Francis.
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Weatherly, L. (2003). Human capital-the elusive asset: Measuring and managing human capital: A strategic imperative for HR. Research Quarterly, Society for Human Resource Management.
Weick, C. & Quinn, R. (1999). Organizational change and development. Annual Review of Psychology, vol. 50: 361-386.