Challenges of the Fourth Industrial Revolution in HRM

Challenges of the Fourth Industrial Revolution in HRM

Beáta Sz. G. Pató, Klaudia Kovács, János Abonyi
DOI: 10.4018/IJHCITP.300308
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Abstract

As a result of the changes caused by Industry 4.0 and Industry 5.0, unknown or less prominent challenges will be the focus of the operation of organizations and will essentially transform current human resource management (HRM) and its framework and tools. This research aims to identify Industry 4.0 solutions and expected changes in the field of human resources (HR) and for employees and to outline emerging trends of Industry 4.0 that impact HR based on interviews with surveyed companies and a review of the relevant literature. Structured interviews were conducted in this research. After individually processing the responses of each interviewee, the responses were formulated by considering all interviews. This research points out that in terms of HR, recruitment and training are being most affected by the fourth industrial revolution, and changes in competencies and their development processes have begun. Hopefully, the discovered connections will inspire further research and provide useful information on the fields of Industry 4.0 and HR.
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Introduction

Industry 4.0 has promising prospects, thus companies and employees need to recognize them and adapt to the ongoing Fourth Industrial Revolution to take advantage. The rapid changes in the information technology field require innovativeness and willingness to learn but this also demands proper background from the companies (for example suitable employees, processes, tools, training, point of view).

The social-cyber-physical system has a significant effect not only on the work environment but also on society. As Industry 4.0 solutions affect people’s daily life and wellbeing, these technologies need to be human-centered. “With Industry 4.0 posing disruptive challenges at different scales (i.e., business models, manufacturing processes, economy), it is necessary to upgrade the human force at different levels (i.e., technical, psychological, social) to meet those changes (Flores et al., 2020, p. 698)”. Therefore, the HR field is changing. Innovativeness and dynamic adaptability are employee skills that promote effective responses to emerging economic and social challenges (Abonyi & Miszlivetz, 2019).

Industry 4.0 is transforming the way we work; work done by humans will be performed by employee-controlled robots. Industry 4.0 technologies can increase operational efficiency and even the level of sustainability. (Gomes et al., 2020) Employees need to be trained to operate new applications, and top management is challenged to keep up with changing business paradigms (Rana & Sharma, 2019).

Industry 4.0 can be briefly defined as a phenomenon involving information technology and automation that are increasingly intertwined with the real physical world. Thus, Industry 4.0 can be defined as a fusion of virtual and physical reality (Pató et al., 2020). “… advanced technologies would increase the innovation capacity of human resources (HR) and result in greater productivity (Rana & Sharma, 2019, p. 177).” According to this statement, HR professionals must select employees with complex knowledge and competencies that are suitable for each job, provide the necessary training for employees, and help the layer of employees who will not be able to find a suitable job in the changing labor market.

This paper is eager to explore the situation of industry 4.0 and HR based on a literature review and a research presented in this article. It is structured by the following: this introduction is followed by the literature review (fourth industrial revolution and expected changes in the Human Resources field). The materials and methods section consists of the research plan, the conceptual models, and the presentation of the research question and research methodology. After a detailed presentation of the results (the aspects: What kind of job changes can be observed? How is Industry 4.0 implemented in HR operations, and what are the related challenges? How do employees react to changes caused by Industry 4.0? How can HR prepare employees for changes caused by Industry 4.0?), the paper is summarized. (Misra, 2021)

By conducting interviews, this research seeks to answer a question: What kind of changes can be observed in HR as a result of Industry 4.0 among the interviewed companies located in Hungary? This paper aims to present innovative research on HR and human factors and human performance in the digital era.

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