basic human resource management

BASIC

Human Resource Management

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What Do I Need to Know? (1 of 2)

1. Define human resource management and explain how HRM contributes to an organization’s performance.

2. Briefly discuss and illustrate each of the important trends influencing human resource management.

3. List and briefly describe important trends in human resource management

4. Identify the responsibilities of human resource departments.

5. Summarize the types of skills needed for human resource management.

What Do I Need to Know? (2 of 2)

6. Explain the role of supervisors in human resource management. 7. Discuss ethical issues in human resource management. 8. Describe typical careers in human resource management. 9. Identify several challenges today’s human resource managers currently

face. 10. Outline several potential challenges and contributions that an

increasingly diverse workforce presents. 11. Discuss the role of human resource managers in the future. 12. Explain how human resource managers can affect organizational

performance. 13. Summarize several guidelines to follow when communicating human

resource programs.

Competitive Challenges Ahead

• Globalization • Value Chain for Business Competitiveness & HR services • Profitability through cost and growth • Capability Focus • Change, change, and change some more • Technology • Attracting, retaining, & measuring competence & intellectual capital • Turnaround is not transformation

• People go into HR because they like people

• HR departments are not designed to provide corporate therapy or as social or health-and-happiness retreats.

• HR professionals must create the practices that make employees more competitive, not more comfortable.

• Anyone can do HR. • HR activities are based on theory and research.

• HR professionals must master both theory and practice.

• HR deals with the soft side of business and is therefore not accountable.

• The impact of HR practices on business results can and must be measured.

• HR professionals must learn how to translate their work into financial performance.

• HR focuses on costs, which must be controlled

• HR practices must create value by increasing the intellectual capital within the firm.

• HR professionals must add value, not reduce costs.

• HR’s job is to be the policy police and the health-and-happiness patrol.

• The HR function does not own compliance- managers do.

• HR practices do not exist to make employees happy but to help them become more committed.

• HR professionals must help managers commit employees and administer policies.

• HR is full of fads. • HR policies have evolved over time.

• HR professionals must see their current work as part of an evolutionary chain and explain their work with less jargon and more authority.

• HR is staffed by nice people.

• At times, HR should force vigorous debates.

• HR professionals should be confrontative and challenging as well as supportive.

• HR is HR’s job. • HR work is as important to managers as are finance, strategy, and other business domains.

• HR professionals should join with managers in championing HR issues.

Human Resource Management at Work

• What Is Human Resource Management (HRM)? – The process of acquiring, training, appraising, and compensating

employees, and of attending to their labor relations, health and safety, and fairness concerns.

• Organization – People with formally assigned roles who work together to

achieve the organization’s goals. • Manager

– The person responsible for accomplishing the organization’s goals, and who does so by managing the efforts of the organization’s people.

The Management Process

Copyright © 2011 Pearson Education, Inc. publishing

as Prentice Hall 1–15

Planning

Organizing

Leading Staffing

Controlling

16

Source of Organisational Capabilities:

Human Capital-skills,experience,know-how and capabilities of individuals in the organisation.

Structural Capital-Organisational architecture,business processes,culture,decision making,patents, trademarks.(Intellectual Capital).

Relationship Capital-internal and external interconnectedness, Value Chain Management,Image promotion and development

HRM can increase its contribution to the organisations’ effectiveness by playing key role in creating value in each of the components of strategic capability.

Through sound HR Policies, Programs and Practices

• HR should be involved in the identification of Key Competencies that are needed to exploit existing Organization Capabilities; Developing Competencies to achieve organization's strategy.

Human Resource Management (HRM)

The policies, practices, and systems that influence employees’:

– behavior

– attitudes

– performance

Human Resource Management Practices

At companies with effective HRM:

• Employees and customers tend to be more satisfied.

• The companies tend to: – be more innovative – have greater productivity – develop a more favorable reputation in the

community

Human Capital

• Human Capital – an organization’s employees described in terms of their:

– training

– experience

– judgment

– intelligence

– relationships

– insight

• The concept of “human resource management” implies that employees are resources of the employer.

Competency Based HRM

• Competencies begin to play a central role in the formulation of an HR strategy;

• This is an HR strategy that is directly aligned to the business strategy

• HR needs skills and tools for competency tracking and management for the individuals and teams within an organisation.

• Such tracking helps in Skills Gap analysis. • These processes can now be assisted by standardised data formats,

which can be automated.

Talent management

• Talent management is the strategic management of the flow of talent through an organization.

• Its purpose is to assure that the supply of talent is available to align the right people with the right jobs at the right time based on strategic business objectives.

Impact of Human Resource Management

Behind these numbers are gaps in areas particularly relevant in today’s environment

Traditionally Engaged

Belief in company goals

and objectives

Emotional connection

(pride, recommendation)

Willingness to give

extra effort to support

success

Energy

Can sustain energy

needed at work

Have social supports in

work environment

Have sense of

enthusiasm and

accomplishment at work

Enablement

Freed from obstacles to

succeed at work

Have resources to

perform well

Can meet work

challenges effectively

Ensuring people are

capable of doing their

jobs well

Ensuring people have

capacity to perform at

their best

HRM and Sustainable Competitive Advantage

• An organization can succeed if it has sustainable competitive advantage.

• Human resources have the necessary qualities to help give organizations this advantage: – Human resources are valuable. – Human resources with needed skills and and knowledge are

sometimes rare. – Human resources cannot be imitated. – Human resources have no good substitutes.

High-Performance Work System

An organization in which technology, organizational structure, people, and processes all work together to give an

organization an advantage in the competitive environment.

Engaged, Enabled Employees Deliver Bottom-Line Benefits

Responsibilities of HR Departments

Activities of the Major Human Resource Functions

1-30

Skills of HRM Professionals

Who Performs the Human Resource Functions?

• Human resource generalist

– Person who devotes a majority of working time to human resource issues, but does not specialize in any specific areas.

• Human resource specialist

– Person specially trained in one or more areas of human resource management

– labor relations specialist, wage and salary specialist

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Supporting the Organization’s Strategy

• Human resource planning – identifying the numbers and types of employees the organization will require to meet its objectives.

• The organization may turn to its HR department for help in managing the change process.

• Skilled HR professionals can apply knowledge of human behavior, along with performance management tools, to help the organization manage change constructively.


• Evidence-based HR– Collecting and using data to show that human resource practices have a positive influence on the company’s bottom line or key stakeholders.

Questions for Understanding the Organization’s Business Strategies

Why measure HR effectiveness Alignment of HR with Business

Distinctive Competence

To achieve our strategy, what are

the key things we need to do

exceptionally well in order to

achieve our competitive advantage.

Workforce Capability

What are the key capabilities that our

workforce needs to excel in order to

achieve our business strategy?

Strategy

What are our strategic

and business

objectives?

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COMPETENCIES AS LINK BETWEEN STRATEGY AND HUMAN RESOURCE PROGRAMMES

Business Strategy

Organisational Capabilities

Capability Components

Competencies Human Resource

Consequences

•Strategy •Mission •Values • Objectives

•Characteristics of the organization which are crucial for success- fully imple- menting the organization’s strategy

•Measures and actions needed to build each Capability

•The competencies (skills and behaviour) needed to bring about the required capability components

•Human Resource activities for developing and reinforcing the required competencies

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FROM STRATEGY TO INDIVIDUAL COMPETENCIES

Business Strategy

Organisational Capabilities

Capability Components

Employee Competencies

Strategic Intent • To become the Leading telecom provider in Egypt

•Obtain and maintain No. 1 position in telecom l services provision • Accelerate network expansion

•Strong focus on Added value of Customers • Sophisticated information system.

•Knowledge of the Market and Competitors • Understanding of The customer. • Customer focused attitude.

HPCL Model for alignment with business

Strategic partner

(Management of Strategic

Human Resources)

Change Agent

(Management of

Transformation

and change)

Administrative expert

(Management of

Organisation infrastructure)

Employee champion

(Management of

Employee contribution)

Future/strategic focus

Day-to-day operational focus

Pe

op

le

Pro

ce

ss

es

The Dave Ulrich Model

HR as Change Agent

Change Agent

(Management of

Transformation

and change)

Future/strategic focus P

eo

ple

Fo

cu

s

Metrics and the HR Scorecard

• Metrics

– Any set of quantitative measures used to assess workforce performance

• Analysis of cost per hire

• Average length of time to fill a position

• Training cost per employee

• Turnover cost per employee

• New-hire performance by recruiting strategy

Metrics and the HR Scorecard

• HR Scorecard

– Measurement and control system using a mix of quantitative and qualitative measures to evaluate performance

– Modified form of the balanced scorecard system


Corporate Social Responsibility

• A company’s commitment to meeting the needs of its stakeholders.

Stakeholders

• The parties with an interest in the company’s success (typically, shareholders, the community, customers, and employees).

Analyzing and Designing Jobs

Job Analysis

• The process of getting detailed information about jobs.

Job Design

• The process of defining the way work will be performed and the tasks that a given job requires.

Job Analyzing

Recruiting and Hiring Employees

Recruitment

• The process through which the organization seeks applicants for potential employment.

Selection

• The process by which the organization attempts to identify applicants with the necessary knowledge, skills, abilities, and other characteristics that will help the organization achieve its goals.

Top Qualities Employers Seek in Job Candidates

Training and Developing Employees

Training

• A planned effort to enable employees to learn job-related knowledge, skills, and behavior.

Development

• The acquisition of knowledge, skills, and behaviors that improve an employee’s ability to meet changes in job requirements and in customer demands.

Managing Performance

• Performance Management – The process of ensuring that employees’ activities and outputs match the organization’s goals.

• The human resource department may be responsible for developing or obtaining questionnaires and other devices for measuring performance.

Performance Appraisal Process and Pitfalls

Planning and Administering Pay and Benefits

Planning Pay & Benefits

• How much to offer in salary and wages.

• How much to offer in bonuses, commissions, and other performance-related pay.

• Which benefits to offer and how much of the cost will be shared by employees.

Administering Pay & Benefits

• Systems for keeping track of employees’ earnings and benefits are needed.

• Employees need information about their benefits plan.

• Extensive record keeping and reporting is needed.

Maintaining Positive Employee Relations

• Preparing and distributing: – employee handbooks and policies – company publications and newsletters

• Dealing with and responding to communications from employees: – questions about benefits and company policy – questions regarding possible discrimination, safety

hazards, possible harassment • Collective bargaining and contract administration.

Establishing and Administering Personnel Policies

• Organizations depend on their HR department to help establish and communicate policies related to: – hiring

– discipline

– promotions

– benefits

• All aspects of HRM require careful and discreet record keeping.

Ensuring Compliance with Labor Laws

• Government requirements include: – filing reports and displaying posters – avoiding unlawful behavior

• Managers depend on HR professionals to help them keep track of these requirements.

• Lawsuits that will continue to influence HRM practices concern job security.

Who is Responsible for HR?

In an organization, who should be concerned with human resource management?

A. Only HR departments

B. Only Managers

C. Managers and HR departments

Supervisors’ Involvement in HRM

Ethics in Human Resource Management

• Ethics – the fundamental principles of right and wrong.

• Ethical behavior is behavior that is consistent with those principles.

• Many ethical issues in the workplace involve human resource management.

Employee Rights

Right of free consent

Right of privacy

Right of freedom of conscience

Right of freedom of

speech

Right to due process

Ethical companies act according to four principles:

1. In their relationships with customers, vendors, and clients, ethical companies emphasize mutual benefits.

2. Employees assume responsibility for the actions of the company.

3. The company has a sense of purpose or vision that employees value and use in their day-to-day work.

4. They emphasize fairness.

Standards for Identifying Ethical Practices

Standards for Identifying Ethical Human Resource Management Practices

1. HRM practices must result in the greatest good for the largest number of people.

2. Employment practices must respect basic human rights of privacy, due process, consent, and free speech.

3. Managers must treat employees and customers equitably and fairly.

Median Salaries for HRM Positions

Challenges For Today’s Human

Resource Managers

• Diversity in the workforce

• Result of changes in government requirements

• Organizational structures

• Technology

• Management approaches

Diversity in Workforce

• Between years 2004-2018:

– Almost half the new entrants will be women

– White, non-Hispanic males will comprise fewer than one-third of new labor force entrants

– Average age of employees will climb to 42.3

Diversity in Workforce

Increasing globalization of many companies

• Defining diversity in global terms – Looking at all people and everything that makes

them different from one another, as well as the things that make them similar

– Values, habits, and customs

Key Human Resource Related Challenges Facing global Companies

• Cultural differences

• Compliance with data-privacy regulations

• Varying economic conditions across countries

• Time zone differences

• Legal environment

• International compliance

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Challenges and Contributions of Diversity

• Organizations must get away from fitting employees into a single corporate mold – Must create new human resource policies to explicitly

recognize and respond to unique needs of individual employees

• Communication problems that arise will necessitate additional training in written and spoken language skills

1-71

Regulatory Changes

Organizations face new regulations routinely issued in areas of:

• Safety and health • Equal employment opportunity • Pension reform • Quality of work life

1-72

Structural Changes to Organizations

• Downsizing

– Laying off large members of managerial and other employees

• Outsourcing

– Subcontracting work to an outside company that specializes in that particular type of work

1-73

Structural Changes to Organizations

• Rightsizing – Continuous and

proactive assessment of mission-critical work and its staffing requirements

• Reengineering – Fundamental rethinking

and radical redesign of business processes to achieve dramatic improvements in cost, quality, services, and speed

1-74

Technological and Managerial Changes within Organizations

• Computerized information systems are now being used to maintain easily accessible employee data that are valuable in job placement and labor utilization

• Also being used in employee training, succession planning, and compensation management, and to track and report affirmative action activity

• Many organizations have implemented Web-based human resource systems that allow employees to complete many HR-related tasks online.

• Referred to as electronic human resources (eHR)


Advantages of eHR

Employee convenience

Immediate response

Increased accuracy

Reduced costs

1-77


• Telecommuting

– Working at home by using an electronic linkup with a central office

– Applicable to employees in home country or on different continents



• Empowerment

– Form of decentralization that involves giving subordinates substantial authority to make decisions

• Self-managed work teams

– Groups of peers that are responsible for a particular task or area

Human Resource Management In the Future

• Human resource managers must be integrally involved in organization’s strategic and policy-making activities

• Human resource managers need to: – Overcome negative impressions and biases sometimes

associated with this field – Become well-rounded businesspeople – Understand business complexities and strategies

1-80

Becoming more familiar with the business:

• Know the company strategy and business plan

• Know the industry

• Support business needs

• Spend more time with the line people

• Keep your hand on the pulse of the organization

• Learn to calculate costs and solutions in hard numbers

Human Resource Management In the Future

Impact of the HR Manager on Organizational Performance

1. Reducing unnecessary overtime expenses by increasing productivity during a normal day

2. Staying on top of absenteeism and instituting programs designed to reduce money spent for time not worked

3. Eliminating wasted time by employees with sound job design

4. Minimizing employee turnover and unemployment benefit costs by practicing sound human relations and creating a work atmosphere that promotes job satisfaction

5. Installing and monitoring effective safety and health programs to reduce lost-time accidents and keep medical and workers’ compensation costs low


6. Properly training and developing all employees to improve their value to company and do a better job producing and selling high-quality products and services at lowest possible cost

7. Decreasing costly material waste by eliminating bad work habits, attitudes and poor working conditions that lead to carelessness and mistakes

8. Hiring the best people available at every level and avoiding overstaffing


9. Maintaining competitive pay practices and benefit programs to foster a motivational climate for employees

10. Encouraging employees to submit ideas for increasing productivity and reducing costs

11. Installing human resource information systems to streamline and automate many human resource functions


Communicating Human Resource

Programs

• Communication

– The transfer of information that is meaningful to those involved

• Human resource managers must develop an appreciation for the importance of communication

Guidelines for Communicating Human Resource Programs

• Avoid communicating in peer group or “privileged-class” language by focusing on the audience

• Don’t ignore cultural and global aspects of communication

• Back up communications with management action

• Periodically reinforce employee communications

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Guidelines for Communicating Human Resource Programs (cont.)

• Transmit information and not just data

• Don’t ignore perceptual and behavioral aspects of communication; anticipate employee reactions and act accordingly

1-88

Guidelines for Communicating Human Resource Programs (cont.)

• Data – Raw material from which

information is developed – composed of facts that

describe places, people, things, or events and that have not been interpreted

• Information – Data that have been

interpreted – meet a need of one or

more managers

1-89

Test Your Knowledge

• Which HR functions are primarily concerned with 1) ensuring employees are capable of doing their current job , 2) ensuring that employees are satisfied with their rewards.

A. 1) Development; 2) Employee Relations

B. 1) Training; 2) Legal Compliance

C. 1) Selection; 2) Pay & Benefits

D. 1) Training; 2) Pay & Benefits

Summary

• Human resource management (HRM) consists of an organization’s “people practices” – the policies, practices, and systems that influence

employees’ behavior, attitudes, and performance.

• HRM influences who works for the organization and how those people work.

• HR departments have responsibility for a variety of functions related to acquiring and managing employees.

Summary (continued)

• HR management requires substantial human relations skills, including skill in:

– communicating

– negotiating

– team development

• HR professionals also need:

– To understand the language of business

– To be a credible with line managers and executives

– To be strategic partners

Summary (continued)

• Non-HR managers must be familiar with the basics of HRM and their own role with regard to managing human resources.

– Supervisors typically have responsibilities related to all the HR functions.

• HR professionals should make decisions consistent with sound ethical principles.

Summary (continued)

• The decisions of HR professionals should:

– Result in the greatest good for the largest number of people.

– Respect basic rights of privacy, due process, consent, and free speech.

– Treat employees and customers equitably and fairly.

• Careers in HR management may involve specialized work in fields such as recruiting, training, or compensation

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