This first chapter of this study presents the background, problem statement, the purpose of the research, research questions, delimitation and the significance of the study. Finally, this chapter demonstrates the definition of terms in order to give a comprehensive and coherent understanding of this research to readers.
Background of the Study
Organizations have been looking for ways to assess the effectiveness of their HR departments.
Not only CEOs but also internal customers such as line managers and employees are eager to measure how effective the services and activities of HR departments and HR professionals are in their organizations in order to determine what level of commitment HR deserves to receive from the organization. According to Ulrich (1997), HR audits can evaluate HR practices, professionals or the department itself. In practice, continually providing monthly or annual reports about HR departments/HR professionals to their internal and external clients should be an essential part of a human resource department's function. Reporting their functional outcomes regularly to the internal and external customer and the market in general increases not only an HR department's reputation but also reflects on the status of the whole organization. In the context of the recruitment process, human resource philosophies are salient and important to job seekers (Bretz & Judge, 1994). In previous studies, the majority of researchers has focussed on HR performance, productivity and effectiveness as an appropriate measurement to evaluate the outcome of HR departments/HR professionals. In general HR effectiveness had been measured by looking at the contribution which HR has made to a firm's competitive position, its core competencies, its human capital and its bottom line. These aspects of HRM effectiveness have been used and validated in some past studies (Han, Chou, Chao & Wright, 2006; Wright, McMahan, Snell, & Gerhart, 2001).
Being supported by CEOs and Line managers is crucial to HR professionals when they intend to implement new projects in an organization. Holley (2014) stated that CEOs’ major concern is not the detailed process of how the HR department works, but they care more about whether the HR function runs efficiently. Also, the author claimed that line executives think that HR department provides rather simple services to their clients, and those line managers do not feel that
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HR professionals contribute much to the business outcomes in organizations. This view is contested by one unknown HR executive who said "when Line executives do not understand the importance of what we provide, I want to suggest that our function just stops working on anything for one day and see how the organization runs" (Wright et al., 2001, p.14).
Competencies as work-related personal attributes like knowledge, skills, and values that each individual brings to do their work well (Roberts, 1997). In the last two decades, substantial studies have conducted to examine what knowledge, skills, behaviors and other personal characteristics are required for HR professionals to be efficient and productive in their organizational roles.
Generally, this kind of research began in the late 1970s and was led by such contributed scholars named as Borman, Tornow, Heineman, Black, Pinto, Skjervheim and Wallace (Tornow, 1984). In the 1980s Ulrich began a continuous study of HR competencies, which has been updated and introduced its seventh round in 2016, is formally considered as the world’s most comprehensive and largest HR competency model named Human Resource Competency Survey (HRCS) in the HR field today. In this study, HRCS model 2012 is used to examine whether the following subdomains as the strategic positioner, HR innovator and Integrator, technology proponent, change champion, capability and credible activist have been held by HR professionals in the private sector of Mongolia. This model has been developed based on data from the USA and European countries.
The most interesting point is that how this HRCS model 2012 applies and adapts to Mongolian HR professionals, and if Mongolian HR professionals have already possessed these kinds of HR competencies, how would be their effectiveness and contribution to the business today in Mongolia.
Furthermore, even though those HR professionals are capable of doing their tasks, how the work-related negative and positive stressors affect their outcomes and performance. Those two directions of the moderating effects on the relationship independent and dependent variables are also the central concern of the researcher to explore with this study.
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Statement of the Problem
Mongolia became a socialist country in 1924, and when the Soviet Union collapsed in 1990, Mongolia made a significant transformation in its political and economic system into a democratic system. Even though this transformation has brought many positive changes, such as multi-party elections, democracy, land privatization, a market economy and international cooperation (Munkhtsetseg, 2016). The history of HRM as a major profession in Mongolia does not last long.
In this stage of HRM development, Mongolian enterprises have recently come to realize that they cannot compete and succeed in the markets without retaining competitive human capital. In order to support the above statement, the researcher browsed the using the keyword as a Human Resource manager on the exclusive job searching website in Mongolia named “biz network mn”, the result has displayed the total number of 30 different organizations looking for an HR manager the time period between the 17th of October and 14th November in Mongolia.
Furthermore, two leading Mongolian universities, the University of Humanities and the Mongolian University of Technology and Science (MUST), established HRM programs in the late 1990s. Approximately more than 20 institutions and colleges offer a short and long-term training program in order to prepare future HR practitioners and to enhance competencies of professional practitioners. However, these programs have been providing a stable supply of HRM professionals to Mongolian firms; there are no actual measurements to evaluate HR professional competencies in the county. Also, a total of 84,142 companies in Mongolia has been counted as officially operating in May 2016 by the National Statistic Office of Mongolia. In order to help these organizations achieve high performance, each employee, as well as an HR professional, should have necessary general knowledge, skills, and abilities (McMahan, Mohrman, & Lawler, 1996) to accomplish their jobs entirely. In accordance with Selmer and Chiu (2004), HR professionals are supposed to possess a set of competencies to deal with human resource issues and to lead human capital to the next stage of efficiency. Thus, it is necessary to determine the existing competencies of HR professionals and measure their outcomes at this stage of the economic fluctuations occurred in Mongolia.
There have been many previous researchers discussing HR competencies and competency models, but most of them are designed and developed in Western context. Even though very few researchers investigated and broached some concepts of HRM such as recruiting and selection,
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knowledge transfer, career plateau, employees’ performance and motivation in Mongolia, they have neglected to study the relationship between HR competencies and HR effectiveness:
primarily, how HR competencies affect their work outcome and efficiency at a workplace. None of the published studies discussed HR competencies found in the result of the search on the Google scholar.
Additionally, this study aims to investigate the influence of the Challenge and Hindrance stressors on the relationship between HR competencies and HR effectiveness as a moderator. In fact, the negative effects of stress on employees generally influence their work outcomes. In the last few decades, there have shown some specific changes in the functions of HR Professionals that has been bringing more stress on their shoulders such as social media, HR software solution, computerized recruiting, Headhunter recruiting approach, Talent management, employees’ data analysis and so on. Psychologists who study stress claimed that any kind of change– either negative or positive – could be stressful. Lately, two types of stressors: challenge stressors and hindrance stressors have been begun to differentiate by researchers in the stress field (Cavanaugh, Boswell, Roehling, & Boudreau, 2000). Challenge stressors are defined as job demands that are recognized by employees as rewarding work experiences create an opportunity for personal growth (Cavanaugh et al., 2000), whereas hindrance stressors are defined as job demands that are perceived as obstacles to personal growth or demands that limit or hinder one's ability to achieve valued goals (Cavanaugh et al., 2000). Since these two kinds of stressors have different impacts on the work outcome, getting the more comprehensive understanding of the relationships between the stressors and work outcomes can be worthwhile to further in the literature and practice of HR effectiveness in the HR field of Mongolia. In the previous literature, the majority of researchers has considered the challenge and hindrance stressors as their independent variables in their studies.
However, this research emphasizes to investigate those two different types of stressors (Challenge and Hindrance) as moderators on its framework.
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Purpose of the Study
The purpose of this study is to explore what kind of HR competencies Mongolian HR professionals have obtained, examining based on HRCS model 2012, and also discovers the relationship between those examined HR competencies and HR effectiveness perceived by employees. A secondary core aim of the current research is to ascertain how the Challenge and Hindrance stressors affect the relationship between HR competencies and HR effectiveness.
The Scope of the Study
The scope of this study has delimited the data collected from only these random organizations in the private sector in Mongolia. Also, the researcher only focused on the six competencies of HRCS model 2012 and three individual HR Effectiveness: HR service, HR Role, and HR contribution. Generally, HR managers in Mongolia have the broader job scope and endless job responsibilities to carry in order to be recognized as an effective HR in their organizations. Hence, the theoretically verified two different stressors: Challenge and Hindrance stressors were chosen to test how these stressors impact on the individual effectiveness of HR professionals. Overall, the analysis of this study was focused at the individual level of HR competencies and HR effectiveness under the moderating effects of Challenge and Hindrance stressors.
Research Questions
To reach the purpose of this study, the following research questions have been settled in order to follow the core track of this research.
1. What are the most significant HR competencies for HR effectiveness in the private sector in Mongolia?
2. Whether HR competencies are significantly related to HR effectiveness?
3. How Challenge and Hindrance stressors affect HR people in Mongolia?
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Significance of the Study
This research aims to contribute to the development of HRM in Mongolia, especially for HR professionals who lead Mongolian HRM level to the next stage in today’s extremely competitive market. Apparently, that lack of HR competence is a serious issue (Cohen, 2015) in any organizations. Generally, HR professionals must possess and master various kinds of competencies in order to make valuable contributions to the firms' performance. Many previous pieces of research focused on the overall competencies of HR professionals in the European context, but very few studies concentrated on the HR competencies in the Asian context. Mainly, there is the insufficient number of studies paid attention to HR competencies and effectiveness related to Mongolia. Therefore, this research initially aims to examine the levels of HR competencies in Mongolia, using HRCS model (2012). When HR professionals identify the levels of HR competencies by using an HR questionnaire to evaluate themselves the researcher will examine how those competencies affect HR effectiveness perceived by employees. It is very crucial to investigate the above aspects because of the result of this study that will provide an opportunity for Mongolian HR professionals to analyze their work outcome, and introspect their contribution to firms.
Additionally, this study seeks to explore how the Challenge and Hindrance stressors affect the relationship between HR competencies and their effectiveness. Regarding the result of the influence of those stressors on the relationship between Independent variables and Dependent variables, the implication of this study partly could be useful to employers to control the stressors on HR professionals in order to increase HR effectiveness in organizations.
Generally, this study can be one of the precursor studies designed for the contribution to the HR field of Mongolia. Also, the result of this research expectantly can be beneficial either literature review or HR practice in Mongolia.
A Prospective Contribution to HR Research Field in Mongolia
What has explicitly motivated the researcher to do this study is that currently there are lots of studies used different HR competency models that have been tested not only in USA/UK or other European countries but also in the most of the Asian countries such as Malaysia, Indonesia, Thailand and Taiwan. The HRCS model is a globally known and latest updated competency model
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that hasn’t been conducted in Mongolia context yet. Therefore, the result of this research will be likely to bring Mongolian researchers’ attention to the competencies of HR and to stimulate the researchers to do more investigations on HR competencies of the key economic industries such as mining, agriculture, and construction in Mongolia.
A Prospective Contribution to HR Professionals
In order to give the respondent's opportunity to get acknowledged the main pattern of HR competencies and contribution in Mongolia, a brief conclusion, and the practical implication will be sent to all HR survey's participants who have provided voluntarily to their contact addresses on their investigation. Equipped with this demanding evidence-based study results, probably HR managers will be expected to take some steps in order to strengthen or catch up the most general lacked competencies if they feel deficient in some of the elements of the HRCS model 2012.
A Prospective Contribution to HRM Students
A concise conclusion of this study will be delivered to two leading state universities in Mongolia. Officially, they are considered as the universities that specialize in HR programs to prepare the future generation of HR practitioners in Mongolia. It is highly anticipated that this paper will help the HR students understand, the better idea about what kind of HR skill and ability sets they need to develop in order to be considered as a more qualified and capable HR candidate after they finish their studies. Being unqualified and lacking in the educational background of new graduates are the second biggest barrier they encounter in recruiting fresh graduates was claimed by 23.5% of the Mongolian employers who participated in one of the flagship studies of the Research Institute of Mongolian labor and social protection in 2016 (The Research Insitute of Mongolian Labour and Social Protection, 2017).
Definition of Terms
HR Effectiveness
HRM effectiveness has been identified in different ways, including the organizational and individual level. However, in this study, the researcher only focuses on the individual level
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effectiveness of an HR professional. Therefore, it can be defined as “How HR professionals perform as internal service providers to employees and Line managers” (Han et al., 2006, p. 393).
HR Competency
Someone’s knowledge, skills, abilities, or other personality characteristics that are used to get someone’s job done (Becker, Huselid & Ulrich, 2001). In this study, Human Resource Competency Study (HRCS) will be used to test HR competencies in Mongolia– an initiative of the University of Michigan - Ulrich and Brockbank began to study Human Resource Competency Study (HRCS) since 1988. Until now, seven rounds (1988, 1992, 1997, 2002, 2007, 2012 and 2016) have been conducted. The data of these seven models can provide plenty of information on key competencies for the HR professionals. The HRCS in 2012 was their third global study about HR competencies (Boselie & Paauwe, 2005). Based on the sampling country’s circumstance in HR field, a version of HRCS 2012 model has been chosen in order to examine the levels of Mongolian HR professional competencies, including six domains that will be tested in this study are strategic positioner, credible activist, capability builder, change champion, HR innovator, and Integrator and technology proponent..
Challenge Stressors
Work-related pressures that create an opportunity for employees to make personal growth (Cavanaugh et al., 2000). The most famous examples of challenge stressors are time urgency, workload, job responsibility and job complexity found in the existing literature.
Hindrance Stressors
Work-related pressures that create obstacles for employees to make personal growth or demands that restrict or interfere one’s ability to achieve valued goals in an organization(Cavanaugh et al., 2000). The most common examples of hindrance stressors are hassles, red tape, role ambiguity and role conflict found in the existing literature.
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