Chapter 12Chapter 12

Building Human AssetsBuilding Human Assets

StaffingStaffing

StaffingStaffing involves bringing new people into the involves bringing new people into the organization and then moving them through, and organization and then moving them through, and perhaps out of, the firm.perhaps out of, the firm.

Staffing consists of three stages:Staffing consists of three stages: recruitingrecruiting selection and hiringselection and hiring placementplacement

These staffing activities are coupled with the These staffing activities are coupled with the training and development function to match the training and development function to match the abilities of the job candidate with the needs of the abilities of the job candidate with the needs of the firm.firm.

Staffing or Training?Staffing or Training?

Should a firm hire people who are ready to step Should a firm hire people who are ready to step into their jobs, or should it “groom” them into their jobs, or should it “groom” them through training programs?through training programs?

With selection and placement, new employees With selection and placement, new employees have proven skills and can begin work have proven skills and can begin work immediately.immediately.

With training and development, people can be With training and development, people can be hired at lower rates of pay if they come to the hired at lower rates of pay if they come to the firm untrained, and training and development firm untrained, and training and development can be tailored exactly to the company’s needs.can be tailored exactly to the company’s needs.

The Staffing/Training Balancing The Staffing/Training Balancing ActAct

(Figure 12-1)(Figure 12-1)

Recruitment,Selection,

andPlacement

Fitting NewEmployee andJob Together

Trainingand

Development

Making SureThat Employees

Grow with Their Jobs

RecruitingRecruiting

Recruiting is the first of staffing’s three Recruiting is the first of staffing’s three stages.stages.

Recruiting refers to all activities involved Recruiting refers to all activities involved in finding interested and qualified in finding interested and qualified applicants for a job opening.applicants for a job opening.

The greater the number of applicants and The greater the number of applicants and the better their qualifications, the more the better their qualifications, the more likely it is that the firm will build a solid likely it is that the firm will build a solid personnel base.personnel base.

Sources of Applicants (Figure 12-Sources of Applicants (Figure 12-3)3)

Source Benefits and Costs

Walk-ins to thecompany

Company must assign someone to greetwalk-ins and deal with applications

Newspaper andmagazine ads

Bring in many applicants, but don’tscreen out unqualified applicants.

Referrals fromcurrent and pastemployees

Referring employees understand thefirm’s needs and may know goodpeople in the industry.

Privateemploymentagencies

These are in the business of matching jobseekers with suitable jobs. Theycharge a fee.

Publicemploymentagencies

Most cities have an office of the stateemployment agency. It finds jobs for theunemployed and may offer training.

Sources of Applicants (Figure 12-Sources of Applicants (Figure 12-3)3)

(Cont.)(Cont.)Source Benefits and Costs

Educationalinstitutions

Good sources of applicants. Companies maysend recruiters to campus.

Labor unions Good sources for blue-collar and someprofessional jobs. Some have hiring halls.

Socialserviceagencies

These provide training and assistance for thehomeless, including help with job seeking.

Coops andinternships

In a coop arrangement, the student attendsschool and works full time on an alternatingbasis. In an internship, the student works forthe employer for a specified period of time.

Temporaryhelpagencies

Contingent workers are employed by a firm ona temporary basis. They are used whenwork is of short duration and many give thecompany flexibility.

Internet RecruitingInternet Recruiting The Internet is the hottest tool for recruiting.The Internet is the hottest tool for recruiting. Search engines such as Yahoo! and Excite as Search engines such as Yahoo! and Excite as

well as bulletin boards and news groups well as bulletin boards and news groups provide job information.provide job information.

Job Banks include America’s Job Bank, the Job Banks include America’s Job Bank, the Monster Board, and others.Monster Board, and others.

Cisco Systems gets 500,000 hits a month on Cisco Systems gets 500,000 hits a month on its Internet job pages. It hires 1,200 people its Internet job pages. It hires 1,200 people every three months, making 66% of its hires every three months, making 66% of its hires from the Net.from the Net.

America’sJob Bank

The Monster Board

Merits of Internal and External Merits of Internal and External Recruiting SourcesRecruiting Sources

Merits of internal Merits of internal methodsmethods

Employees are familiar Employees are familiar with the organization.with the organization.

Recruiting and training Recruiting and training costs are relatively low.costs are relatively low.

Enhance employee morale Enhance employee morale and motivation since they and motivation since they send a signal that the send a signal that the organization offers organization offers opportunities for opportunities for advancement.advancement.

Merits of external Merits of external methodsmethods

Introduce new ideas and Introduce new ideas and approaches.approaches.

Provide knowledge and Provide knowledge and skills that are not skills that are not currently available in the currently available in the organization.organization.

Permit new hires to start Permit new hires to start with clean slates.with clean slates.

Reduce political infighting Reduce political infighting for promotions.for promotions.

The Outsourcing AlternativeThe Outsourcing Alternative In the face of increasing demand, evolving In the face of increasing demand, evolving

needs, or cost considerations firms may use needs, or cost considerations firms may use outside parties to perform tasks that would outside parties to perform tasks that would otherwise be performed in house.otherwise be performed in house.

This is a popular, rapidly-growing option.This is a popular, rapidly-growing option. In 1996, American firms spent over $100 In 1996, American firms spent over $100

billion in outsourced business activities.billion in outsourced business activities. By outsourcing some activities, firms can By outsourcing some activities, firms can

concentrate their resources on their concentrate their resources on their core core competenciescompetencies, the things that they do , the things that they do particularly well.particularly well.

The Realistic Job Preview (RJP)The Realistic Job Preview (RJP) Most companies present a rosy picture of themselves Most companies present a rosy picture of themselves

and their job openings in order to attract job and their job openings in order to attract job applicants.applicants.

As a result, many new employees experience “entry As a result, many new employees experience “entry shock” and are dissatisfied when they learn the shock” and are dissatisfied when they learn the “truth” about the company.“truth” about the company.

The aim of The aim of realistic job preview (RJP)realistic job preview (RJP) is to give the is to give the recruit an accurate picture of what the company and recruit an accurate picture of what the company and the job are like.the job are like.

RJPs lead to higher levels of employee satisfaction and RJPs lead to higher levels of employee satisfaction and lower levels of turnover. They don’t appear to reduce lower levels of turnover. They don’t appear to reduce job acceptance rates.job acceptance rates.

Focus on ManagementFocus on ManagementWanted: Someone to Go Down in the Wanted: Someone to Go Down in the

Perfect StormPerfect Storm State News Service, struggling to stay alive, turned to a State News Service, struggling to stay alive, turned to a

realistic (and humorous) job preview to recruit realistic (and humorous) job preview to recruit reporters.reporters.

Bluntly facing its relatively unattractive status, it ran an Bluntly facing its relatively unattractive status, it ran an ad based on Sir Ernest Shackleton’s famous 1914 ad to ad based on Sir Ernest Shackleton’s famous 1914 ad to recruit a shipping crew for a risky transatlantic journey.recruit a shipping crew for a risky transatlantic journey.

The ad read, “Reporters wanted for hazardous journey. The ad read, “Reporters wanted for hazardous journey. Small wages. Bitter cold. Long months of complete Small wages. Bitter cold. Long months of complete darkness. Constant danger. Safe return doubtful. darkness. Constant danger. Safe return doubtful. Honour and recognition in case of success.”Honour and recognition in case of success.”

The ad drew job seekers from all over the world.The ad drew job seekers from all over the world.

Bottom Line: The Recruiting Bottom Line: The Recruiting ProcessProcess

Identify aJob Opening

Identify aJob Opening

Determine JobRequirementsand EmployeeQualifications

Needed

Determine JobRequirementsand EmployeeQualifications

Needed

IdentifyAppropriateRecruiting

Sources andMethods

IdentifyAppropriateRecruiting

Sources andMethods

GenerateApplicant

Pool

GenerateApplicant

Pool

ImplementRecruitingStrategy

ImplementRecruitingStrategy

EvaluateRecruitingProcess

EvaluateRecruitingProcess

SelectionSelection The role of The role of selectionselection is to evaluate each candidate’s is to evaluate each candidate’s

qualifications and pick the one whose skills and interests qualifications and pick the one whose skills and interests best match requirements of the job and company.best match requirements of the job and company.

Some firms use informal selection procedures, such as Some firms use informal selection procedures, such as reviewing application blanks and resumes. Others use reviewing application blanks and resumes. Others use formal procedures, such as tests and assessment formal procedures, such as tests and assessment centers.centers.

Careful selection procedures can be time consuming and Careful selection procedures can be time consuming and costly. They are worthwhile if:costly. They are worthwhile if: the costs of a wrong decision are highthe costs of a wrong decision are high there are many applicants and few openingsthere are many applicants and few openings selection tools are accurateselection tools are accurate

Focus on Management: Selection Focus on Management: Selection at Toyotaat Toyota

When Toyota Motor Corp. wanted to fill When Toyota Motor Corp. wanted to fill positions at its new Kentucky auto assembly positions at its new Kentucky auto assembly plant, it received 90,000 applications from 120 plant, it received 90,000 applications from 120 countries for its 2,700 production jobs and countries for its 2,700 production jobs and thousands more for the 300 office jobs.thousands more for the 300 office jobs.

The company wanted to select workers who The company wanted to select workers who would conform to its emphasis on teamwork, would conform to its emphasis on teamwork, loyalty, and versatility.loyalty, and versatility.

In addition to physical exams and drug tests, In addition to physical exams and drug tests, applicants had to spend as much as 25 hours applicants had to spend as much as 25 hours completing written tests, workplace completing written tests, workplace simulations, and interviews.simulations, and interviews.

Only 1 of 20 applicants made it to the Only 1 of 20 applicants made it to the interview.interview.

Application FormsApplication Forms

The The application formapplication form is the first source of is the first source of information about a potential employee.information about a potential employee.

It provides the hiring firm with information It provides the hiring firm with information about educational background, work about educational background, work experience, and outside interests.experience, and outside interests.

Much of this information is especially useful Much of this information is especially useful for screening purposes.for screening purposes.

Problems with Application FormsProblems with Application Forms

The information provided by the applicant The information provided by the applicant may not be relevant to job performance.may not be relevant to job performance.

Job applicants may provide incorrect or Job applicants may provide incorrect or misleading information.misleading information.

The law places many restrictions on what The law places many restrictions on what can and cannot be asked on a job can and cannot be asked on a job application.application.

Some Unfair Pre-Employment Some Unfair Pre-Employment InquiriesInquiries

(Excerpted from Figure 12-4)(Excerpted from Figure 12-4) Any inquiry that implies a preference for people under 40 Any inquiry that implies a preference for people under 40

years of ageyears of age Whether applicant is a citizen; any inquiry into citizenship Whether applicant is a citizen; any inquiry into citizenship

than tends to divulge applicant’s lineage, ancestry, than tends to divulge applicant’s lineage, ancestry, national origin, descent, or birthplacenational origin, descent, or birthplace

All inquiries relating to arrestsAll inquiries relating to arrests Request that applicant submit a photographRequest that applicant submit a photograph GenderGender Any inquiry concerning race or color of skin, hair, eyes, Any inquiry concerning race or color of skin, hair, eyes,

etc.etc. Any inquiry concerning religious denomination, Any inquiry concerning religious denomination,

affiliations, holidays observed, etc.affiliations, holidays observed, etc.

Lighten Up: Rotten ResumesLighten Up: Rotten Resumes I am extremely loyal to my present firm, so please don’t let them I am extremely loyal to my present firm, so please don’t let them

know of my immediate availability.know of my immediate availability. Note: Please don’t misconstrue my 14 jobs as ‘job hopping.’ I Note: Please don’t misconstrue my 14 jobs as ‘job hopping.’ I

have never quit a job.have never quit a job. Marital status: Often. Children: Various.Marital status: Often. Children: Various. Wholly responsible for two (2) failed institutions.Wholly responsible for two (2) failed institutions. Terminated after saying, “It would be a blessing to be fired.”Terminated after saying, “It would be a blessing to be fired.” I am writing to you, as I have written to all Fortune 1000 I am writing to you, as I have written to all Fortune 1000

companies every year for the past three years, to solicit companies every year for the past three years, to solicit employment.employment.

It’s best for employers that I not work with people.It’s best for employers that I not work with people. Excellent memory; strong math aptitude; excellent memory; Excellent memory; strong math aptitude; excellent memory;

effective management skills; and very good at math.effective management skills; and very good at math.

InterviewsInterviews In an In an interviewinterview, a representative of the hiring firm asks , a representative of the hiring firm asks

the candidate a series of questions.the candidate a series of questions. The goal is to determine how well the candidate’s skills The goal is to determine how well the candidate’s skills

and interests match the job requirements.and interests match the job requirements. In a In a structured interviewstructured interview, all candidates are asked the , all candidates are asked the

same list of questions in the same order. This gives each same list of questions in the same order. This gives each applicant the same chance as others, makes it easier to applicant the same chance as others, makes it easier to compare candidates, and makes it less likely the firm will compare candidates, and makes it less likely the firm will be sued for discrimination in hiring.be sued for discrimination in hiring.

In an In an unstructured interviewunstructured interview, there is a looser , there is a looser exchange between the interviewer and job candidate. exchange between the interviewer and job candidate. This may result in a more complete picture.This may result in a more complete picture.

Advantages of InterviewsAdvantages of Interviews It is easier to ask a series of questions than to It is easier to ask a series of questions than to

develop a test.develop a test. Interviewing makes the selection process more Interviewing makes the selection process more

personal and gives the interviewer an overall idea as personal and gives the interviewer an overall idea as to whether the applicant is right for the job.to whether the applicant is right for the job.

The interview may be used to give the applicant The interview may be used to give the applicant information about the job and company.information about the job and company.

Interviews may be used to “sell” the company to the Interviews may be used to “sell” the company to the applicant.applicant.

Interviews may be be used to complete the Interviews may be be used to complete the information about job candidates.information about job candidates.

Good candidates may be unwilling to consider a job Good candidates may be unwilling to consider a job seriously unless they had the change to ask questions seriously unless they had the change to ask questions and gather information.and gather information.

Problems with InterviewsProblems with Interviews Interviewers:Interviewers:

show many biasesshow many biases disagree with one another disagree with one another ignore much of the information availableignore much of the information available

The success of an interview in identifying The success of an interview in identifying the best candidate for the job depends on the best candidate for the job depends on the skill and good judgment of the the skill and good judgment of the individual interviewer.individual interviewer.

There are severe legal restrictions on what There are severe legal restrictions on what can be asked in interviews.can be asked in interviews.

Guidelines for Improving Guidelines for Improving InterviewsInterviews

Interviewers should prepare for interviews by making Interviewers should prepare for interviews by making a list of specific topics to be covered and/or specific a list of specific topics to be covered and/or specific questions to be asked.questions to be asked.

Interviewers should be trained in preparing questions Interviewers should be trained in preparing questions relating to job requirements, probing for details, relating to job requirements, probing for details, listening carefully, and avoiding discriminatory listening carefully, and avoiding discriminatory questions.questions.

Interviewers should use behavioral and situational Interviewers should use behavioral and situational questions.questions.

Written records of the interview should be kept.Written records of the interview should be kept. If possible, multiple interviewers should be used.If possible, multiple interviewers should be used. Interviews should be used along with other selection Interviews should be used along with other selection

tools.tools.

The Bottom Line: The Job The Bottom Line: The Job Interviewing ProcessInterviewing Process

Determine JobRequirementsand EmployeeQualifications

Needed

Determine JobRequirementsand EmployeeQualifications

Needed

DevelopBehavioral and

SituationalInterview

Questions

DevelopBehavioral and

SituationalInterview

Questions

Develop anInterview

Rating Form

Develop anInterview

Rating Form

Start EachInterview byPutting theInterviewee

at Ease

Start EachInterview byPutting theInterviewee

at Ease

ProbeIntervieweeResponses

and Explore

Related Issues

ProbeIntervieweeResponses

and Explore

Related Issues

CompleteInterview

Rating FormImmediately

After theInterview

CompleteInterview

Rating FormImmediately

After theInterview

Ask the SameQuestions of

EachInterviewee --Do Not Make

SnapJudgments

Ask the SameQuestions of

EachInterviewee --Do Not Make

SnapJudgments

TestingTesting

A A testtest is a systematic and standardized is a systematic and standardized procedure for obtaining information about procedure for obtaining information about individuals.individuals.

Testing is a relatively objective way to determine Testing is a relatively objective way to determine how well a person may do on the job.how well a person may do on the job.

Many human resource experts and human Many human resource experts and human resource managers believe testing is the single resource managers believe testing is the single best selection tool.best selection tool.

Tests yield more information about a person than Tests yield more information about a person than does a completed application form, and they are does a completed application form, and they are generally less biased than interviews.generally less biased than interviews.

Types of TestsTypes of Tests

Ability testsAbility tests measure whether the applicant has measure whether the applicant has certain skills needed to perform the job tasks.certain skills needed to perform the job tasks.

Personality testsPersonality tests measure the strength or measure the strength or weakness of personality characteristics that are weakness of personality characteristics that are considered important for good performance on considered important for good performance on the job.the job.

Interest testsInterest tests measure a person’s likes or measure a person’s likes or dislikes for various activities.dislikes for various activities.

Work sample testsWork sample tests measure how well measure how well applicants perform selected job tasks.applicants perform selected job tasks.

Types of Tests (Continued)Types of Tests (Continued)

Integrity testsIntegrity tests measure an applicant’s measure an applicant’s honesty.honesty.

Drug and impairment testsDrug and impairment tests measure measure abuse of alcohol or other drugs.abuse of alcohol or other drugs.

Genetic testingGenetic testing applies the science of applies the science of genetics to the testing of workers. genetics to the testing of workers.

Forms of Ability TestsForms of Ability Tests

AbilityTests

Mental AbilityTests

MechanicalAbility Tests

PsychomotorAbility Tests

Integrity TestsIntegrity Tests A A polygraph (“lie detector”) testpolygraph (“lie detector”) test is an electronic is an electronic

device used to detect lying. Due to concerns about device used to detect lying. Due to concerns about validity and invasion of privacy, a 1988 federal law validity and invasion of privacy, a 1988 federal law outlawed most private uses of pre-employment polygraph outlawed most private uses of pre-employment polygraph tests aimed at assessing employee honesty. tests aimed at assessing employee honesty.

Written “honesty” or “integrity” tests contain items Written “honesty” or “integrity” tests contain items concerning one’s attitudes toward theft and other forms concerning one’s attitudes toward theft and other forms of dishonesty. These may be less valid than the of dishonesty. These may be less valid than the polygraph tests they replace, and may cause resentment.polygraph tests they replace, and may cause resentment.

Many firms use credit checks to judge applicant integrity. Many firms use credit checks to judge applicant integrity. There are legal restrictions regarding credit checks.There are legal restrictions regarding credit checks.

Drug and Impairment TestsDrug and Impairment Tests Drug and impairment tests measure abuse of alcohol Drug and impairment tests measure abuse of alcohol

and other drugs.and other drugs. More than 80% of major U.S. corporations use drug More than 80% of major U.S. corporations use drug

tests.tests. Drug testsDrug tests may involve examination of body fluids, may involve examination of body fluids,

such as urine and blood, or hair, or of reaction of the such as urine and blood, or hair, or of reaction of the pupil to light.pupil to light.

In response to concerns about violation of rights of In response to concerns about violation of rights of privacy and errors in the testing process, many firms privacy and errors in the testing process, many firms instead use impairment testing. This involves use of instead use impairment testing. This involves use of activities similar to a video game to measure an activities similar to a video game to measure an employee’s ability to work.employee’s ability to work.

Impairment testsImpairment tests detect impairment due to things detect impairment due to things such as illness, sleep deprivation, and emotional such as illness, sleep deprivation, and emotional preoccupation that would be missed by drug tests.preoccupation that would be missed by drug tests.

Genetic TestingGenetic Testing Genetic testingGenetic testing takes two forms: takes two forms:

genetic monitoringgenetic monitoring involves periodically testing groups of involves periodically testing groups of employees to see whether they are showing any alarming employees to see whether they are showing any alarming chromosomal abnormalities that might have been caused by chromosomal abnormalities that might have been caused by their environment.their environment.

genetic screeninggenetic screening is a one-time analysis of DNA taken from is a one-time analysis of DNA taken from blood or other bodily fluids. It is aimed at finding genetic blood or other bodily fluids. It is aimed at finding genetic “markers” that indicate that a person may be especially “markers” that indicate that a person may be especially susceptible to harm from a particular substance.susceptible to harm from a particular substance.

Genetic monitoringGenetic monitoring has the approval of most observers has the approval of most observers since it provides an early warning of dangers from the since it provides an early warning of dangers from the work environment, but genetic screening is controversial.work environment, but genetic screening is controversial.

Focus on Management: Too Smart Focus on Management: Too Smart forfor

the New London Police the New London Police DepartmentDepartment

The city of New London, Connecticut refused The city of New London, Connecticut refused to grant Robert Jordan a job interview to grant Robert Jordan a job interview because he scored too because he scored too highhigh on a pre- on a pre-employment test.employment test.

The city’s rationale was that employees who The city’s rationale was that employees who are too smart are likely to be bored in patrol are too smart are likely to be bored in patrol jobs and thus to leave the force.jobs and thus to leave the force.

Jordan sued the department, but a federal Jordan sued the department, but a federal judge ruled that the practice of excluding too-judge ruled that the practice of excluding too-bright applicants was constitutional.bright applicants was constitutional.

Test ValidityTest Validity

ValidityValidity is the degree to which predictions from is the degree to which predictions from the selection device are supported by evidence.the selection device are supported by evidence.

Valid tests are expensive to develop.Valid tests are expensive to develop. Some jobs, such as those of top management, Some jobs, such as those of top management,

are hard to describe, and the abilities and are hard to describe, and the abilities and interests required may be all but impossible to interests required may be all but impossible to predict on the basis of test results.predict on the basis of test results.

In general, ability tests and work sample tests In general, ability tests and work sample tests are more valid than other selection tools.are more valid than other selection tools.

GraphologyGraphology

GraphologyGraphology, or handwriting analysis, is sometimes used to , or handwriting analysis, is sometimes used to predict performance.predict performance.

The theory behind graphology is that handwriting reflects The theory behind graphology is that handwriting reflects personality.personality.

Graphology is very popular in western Europe; most French Graphology is very popular in western Europe; most French companies require applicants to submit handwritten letters.companies require applicants to submit handwritten letters.

While graphology is difficult to fake, there is no solid evidence While graphology is difficult to fake, there is no solid evidence that it predicts job performance.that it predicts job performance.

Test FairnessTest Fairness Everyone agrees that a test should be fair, but few Everyone agrees that a test should be fair, but few

agree on a definition of fairness.agree on a definition of fairness. To some people, a test is unfair if it includes questions To some people, a test is unfair if it includes questions

about things that might be unfamiliar to some people about things that might be unfamiliar to some people because of their race or ethnic origin.because of their race or ethnic origin.

To other people, a test is unfair if it measures things To other people, a test is unfair if it measures things that aren’t needed on the job but that block some that aren’t needed on the job but that block some people from being hired.people from being hired.

In the eyes of the law, a fair test is one that does not In the eyes of the law, a fair test is one that does not overpredict or underpredict performance of one group overpredict or underpredict performance of one group of employees relative to another.of employees relative to another.

Assessment CentersAssessment Centers An An assessment centerassessment center is a collection of systematic is a collection of systematic

procedures to approach the selection process systematically.procedures to approach the selection process systematically. The centers employ psychologists and other experts on The centers employ psychologists and other experts on

human behavior as well as providing tests, interviews, group human behavior as well as providing tests, interviews, group discussions, and other approaches for evaluating job discussions, and other approaches for evaluating job candidates.candidates.

Assessment centers may use Assessment centers may use role playingrole playing and and in-basketsin-baskets.. Assessment centers have additional uses, including early Assessment centers have additional uses, including early

detection of management talent and skill development for detection of management talent and skill development for assessors.assessors.

While expensive, assessment centers are quite valid and are While expensive, assessment centers are quite valid and are seen by employees as offering a fair chance to show abilities.seen by employees as offering a fair chance to show abilities.

Selecting for TeamsSelecting for Teams

Organizations must carefully screen team candidates Organizations must carefully screen team candidates for their ability to work with other team members.for their ability to work with other team members.

In putting together a self-directed team, Delta Dental In putting together a self-directed team, Delta Dental Plan:Plan: spent more than 6 months recruiting and selecting team spent more than 6 months recruiting and selecting team

members.members. used a personality test to find members with used a personality test to find members with

complementary personality types.complementary personality types. selected some bilingual team members.selected some bilingual team members. selected members from both inside and outside the selected members from both inside and outside the

company.company. assessed candidates’ interpersonal skills with interviews by assessed candidates’ interpersonal skills with interviews by

members of the HR department and others.members of the HR department and others.

The Bottom Line: The Selection The Bottom Line: The Selection ProcessProcess

Identify SelectionMethods Based onJob Requirements

and DesiredEmployee

Qualifications

Identify SelectionMethods Based onJob Requirements

and DesiredEmployee

Qualifications

Administer SelectionMethods to

Applicant PoolGenerated by the

Recruiting Process

Administer SelectionMethods to

Applicant PoolGenerated by the

Recruiting Process

AssessPerson-Job

Fit

AssessPerson-Job

Fit

AssessPerson-

OrganizationFit

AssessPerson-

OrganizationFit

ReduceApplicant Poolto “Short List”

of Top 3-5

ReduceApplicant Poolto “Short List”

of Top 3-5

Extend Job Offers andNegotiate Termswith Candidate(s)

Extend Job Offers andNegotiate Termswith Candidate(s)

Evaluate theProcess

Evaluate theProcess

PlacementPlacement

PlacementPlacement means fitting people and jobs means fitting people and jobs together after the people have become together after the people have become employees of the firm.employees of the firm.

It includes everything from helping new It includes everything from helping new employees feel at home in the firm to employees feel at home in the firm to promoting them to positions of greater promoting them to positions of greater responsibility or demoting them to less responsibility or demoting them to less demanding position when necessary.demanding position when necessary.

OrientationOrientation

OrientationOrientation involves introducing new involves introducing new employees to their jobs and to the company.employees to their jobs and to the company.

Orientation:Orientation: reduces uncertainties, makes company policies and reduces uncertainties, makes company policies and

expectations clear, and provides a good idea of what expectations clear, and provides a good idea of what the firm, plant, and coworkers are like.the firm, plant, and coworkers are like.

sends a signal that the new employee has an sends a signal that the new employee has an important role to play in the organization.important role to play in the organization.

offers a bonding opportunity, ensuring that new hires offers a bonding opportunity, ensuring that new hires don’t feel alienated and helping to instill in them a don’t feel alienated and helping to instill in them a sense of pride and opportunity.sense of pride and opportunity.

Lateral MoveLateral Move A A lateral movelateral move is sideways rather than up or is sideways rather than up or

down.down. One type of lateral move, job rotation, may be One type of lateral move, job rotation, may be

used to build worker skills and provide a more used to build worker skills and provide a more solid base for later promotions.solid base for later promotions.

Employees may welcome the change of pace Employees may welcome the change of pace and duties of job rotation, and may develop a and duties of job rotation, and may develop a greater sense of pride and self-worth as they greater sense of pride and self-worth as they learn new skills.learn new skills.

Lateral moves are sometimes dictated by Lateral moves are sometimes dictated by organizational changes, such as reorganizations.organizational changes, such as reorganizations.

W. R. Grace & Company, a chemical and W. R. Grace & Company, a chemical and consumer products company, has been using consumer products company, has been using lateral moves for years.lateral moves for years.

Purposes include:Purposes include: assignment to special projects for the company’s assignment to special projects for the company’s

futurefuture to fill slots at locations far from their current poststo fill slots at locations far from their current posts to newly created jobs in other countriesto newly created jobs in other countries

The company’s VP for corporate administration The company’s VP for corporate administration reports that, “They get new challenges, and we reports that, “They get new challenges, and we get broadened managers -- something a global, get broadened managers -- something a global, decentralized company must have.”decentralized company must have.”

Lateral Moves at W. R. Grace Lateral Moves at W. R. Grace

PromotionPromotion

A A promotionpromotion is a move up, generally to a new title, is a move up, generally to a new title, more responsibility, and greater financial rewards.more responsibility, and greater financial rewards.

Promotions are valued by employees, and move Promotions are valued by employees, and move competent employees to positions with greater impact competent employees to positions with greater impact on the firm’s success.on the firm’s success.

Promotions also demonstrate to other employees that Promotions also demonstrate to other employees that good performance and potential are rewarded, thus good performance and potential are rewarded, thus serving as a motivating device.serving as a motivating device.

Promotions must be handled carefully since jobs at Promotions must be handled carefully since jobs at different levels may require different skills. If not, the different levels may require different skills. If not, the Peter PrinciplePeter Principle may occur. may occur.

Some firms have instituted fallback positions for Some firms have instituted fallback positions for employees who are unhappy with their promotions.employees who are unhappy with their promotions.

DemotionDemotion

A A demotiondemotion is a move down in the organizational is a move down in the organizational hierarchy to a lower title and salary and less hierarchy to a lower title and salary and less responsibility.responsibility.

Demotions are stressful to employees and may be Demotions are stressful to employees and may be resisted by unions.resisted by unions.

Demotions may be necessary. A firm may demote Demotions may be necessary. A firm may demote rather than fire a poorly-performing employee. Also, rather than fire a poorly-performing employee. Also, especially during economic downturns, employees especially during economic downturns, employees may prefer demotions to unemployment.may prefer demotions to unemployment.

Some firms have experimented with demoting Some firms have experimented with demoting employees temporarily so they can relate better to employees temporarily so they can relate better to their subordinates.their subordinates.

TerminationTermination Sometimes firings are necessary because employees Sometimes firings are necessary because employees

have continued to perform poorly or because they have have continued to perform poorly or because they have been unmotivated or uncooperative.been unmotivated or uncooperative.

Firings are traumatic for the terminated individual and Firings are traumatic for the terminated individual and costly for the firm. For instance, the firm will have to costly for the firm. For instance, the firm will have to bear the costs of recruiting and training a replacement.bear the costs of recruiting and training a replacement.

Employees who are performing below standards should Employees who are performing below standards should be counseled and given written performance goals and be counseled and given written performance goals and plans for meeting them.plans for meeting them.

Those employees should have a probationary period and Those employees should have a probationary period and should receive regular feedback over that period.should receive regular feedback over that period.

Termination (Continued)Termination (Continued)

Firing should only be used if corrective efforts Firing should only be used if corrective efforts fail, as a last resort.fail, as a last resort.

In recent years, many employees have been In recent years, many employees have been fired as a result of things having little to do with fired as a result of things having little to do with their motivation or performance, such as their motivation or performance, such as technological changes, restructuring, mergers, technological changes, restructuring, mergers, changes in strategy, and foreign competition.changes in strategy, and foreign competition.

In some cases, firms hire outplacement In some cases, firms hire outplacement companies to assist those who are affected.companies to assist those who are affected.

There are increasing legal restrictions on firing.There are increasing legal restrictions on firing.

Guidelines for Effective Guidelines for Effective TerminationTermination

Give as much warning as possible for mass layoffs.Give as much warning as possible for mass layoffs. Be sure the employee hears of the termination Be sure the employee hears of the termination

from a manager, not from a colleague.from a manager, not from a colleague. Sit down one-on-one in a private office with the Sit down one-on-one in a private office with the

individual to be terminated.individual to be terminated. Tell the individual in the first sentence that he or Tell the individual in the first sentence that he or

she is terminated; leave no room for confusion.she is terminated; leave no room for confusion. Express appreciation for the employee’s past Express appreciation for the employee’s past

accomplishments if appropriate.accomplishments if appropriate.

Guidelines for Effective Guidelines for Effective Termination (Continued)Termination (Continued)

Complete the firing session within 15 minutes. Complete the firing session within 15 minutes. Make the session brief and to the point, not an Make the session brief and to the point, not an opportunity for debate.opportunity for debate.

Keep the conversation professional, avoiding Keep the conversation professional, avoiding personal comments.personal comments.

Briefly explain how much severance pay will be Briefly explain how much severance pay will be provided and for how long; provide written provided and for how long; provide written explanations of severance benefits.explanations of severance benefits.

Unless security is an issue, don’t rush the Unless security is an issue, don’t rush the employee off site.employee off site.

Training and DevelopmentTraining and Development

Training and development helps the firm meet Training and development helps the firm meet its immediate human resource needs.its immediate human resource needs.

Over the long run, training and development Over the long run, training and development ensures that the firm’s employees are ready to ensures that the firm’s employees are ready to meet future challenges.meet future challenges.

Training and development takes many forms.Training and development takes many forms. Firms in the U.S. spend an estimated $30 billion Firms in the U.S. spend an estimated $30 billion

annually to train employees.annually to train employees.

Training in JapanTraining in Japan

Workers in the U.S. often Workers in the U.S. often receive far less training than receive far less training than their Japanese counterparts.their Japanese counterparts.

New production workers in New production workers in Japan receive 380 hours of Japan receive 380 hours of training, and new workers in training, and new workers in Japanese-owned plants in the Japanese-owned plants in the U.S. receive 370 hours.U.S. receive 370 hours.

In contrast, new workers in In contrast, new workers in U.S.-owned plants in North U.S.-owned plants in North America receive only 47 hours America receive only 47 hours of training, or one-eighth as of training, or one-eighth as much.much.

Training and DevelopmentTraining and DevelopmentNeeds AssessmentNeeds Assessment

In general, training and development should follow In general, training and development should follow a systematic needs assessment.a systematic needs assessment.

The needs assessment should consider three sets The needs assessment should consider three sets of factors:of factors: The organizationThe organization.. What is the environment for training What is the environment for training

in terms of the organization’s goals, resources, and in terms of the organization’s goals, resources, and climate for training?climate for training?

The task.The task. What is the work to be performed and what What is the work to be performed and what are the conditions under which it will be performed?are the conditions under which it will be performed?

The person.The person. What personal capabilities are needed to What personal capabilities are needed to do the job, and what are the people like who will do the do the job, and what are the people like who will do the job?job?

On-the-Job TrainingOn-the-Job Training On-the-job trainingOn-the-job training is conducted while employees perform is conducted while employees perform

job-related tasks. Employees are not taken out of the job-related tasks. Employees are not taken out of the workplace or put in a classroom.workplace or put in a classroom.

Employees learn the job by doing it, with coaching and Employees learn the job by doing it, with coaching and feedback from a supervisor or more experienced employees.feedback from a supervisor or more experienced employees.

On-the-job training is the most direct approach to training On-the-job training is the most direct approach to training and development and offers quick returns in terms of and development and offers quick returns in terms of improved performance.improved performance.

Job rotation, regular coaching by a supervisor, committee Job rotation, regular coaching by a supervisor, committee assignments to involve individuals in decision-making assignments to involve individuals in decision-making activities, and staff meetings to broader employee activities, and staff meetings to broader employee understanding of company activities outside their immediate understanding of company activities outside their immediate areas are examples.areas are examples.

Off-the-Job TrainingOff-the-Job Training

It is often necessary to train employees It is often necessary to train employees away from the workplace.away from the workplace.

Such Such off-the-job trainingoff-the-job training may take place may take place elsewhere within the firm or outside the elsewhere within the firm or outside the company.company.

There are many popular off-the-job There are many popular off-the-job training techniques.training techniques.

Forms of Off-the-Job TrainingForms of Off-the-Job Training

Off-the-JobTraining

ClassroomTraining

BehaviorModeling

ManagementGames

ProgrammedInstruction

Motorola University’s

Galvin Center

Corporate UniversitiesCorporate Universities

Corporate universitiesCorporate universities are educational are educational organizations established and run by a corporation to organizations established and run by a corporation to educate employees, customers, and suppliers.educate employees, customers, and suppliers.

There are now thousands of corporate universities, There are now thousands of corporate universities, and their numbers are predicted to outstrip those of and their numbers are predicted to outstrip those of traditional universities by 2010.traditional universities by 2010.

Dow Chemical -- which has training expenditures of Dow Chemical -- which has training expenditures of more than $90 million annually -- is developing online more than $90 million annually -- is developing online learning over its company’s intranet.learning over its company’s intranet.

In the first nine months, Dow developed 31 classes, In the first nine months, Dow developed 31 classes, and over one-quarter of its employees completed one and over one-quarter of its employees completed one or more courses.or more courses.

Virtual RealityVirtual Reality

Virtual realityVirtual reality immerses the immerses the trainee in a simulated setting trainee in a simulated setting through the use of computer through the use of computer peripherals and stereographic peripherals and stereographic imaging.imaging.

Although virtual reality Although virtual reality techniques are expensive, they techniques are expensive, they typically cost much less than typically cost much less than training on real equipment.training on real equipment.

Using a specialized display Using a specialized display system called a system called a haptic haptic interfaceinterface, virtual reality can , virtual reality can now simulate touch.now simulate touch.

SensingVest

SensingChair

Haptic Glove

Virtual Reality Goggles

Web Wise: The Virtual Web Wise: The Virtual Environment Technology Environment Technology

Laboratory (VETL)Laboratory (VETL) The Virtual Environment Technology The Virtual Environment Technology

Laboratory is a joint enterprise of the Laboratory is a joint enterprise of the University of Houston and University of Houston and NASA/Johnson Space Center.NASA/Johnson Space Center.

It performs research and development It performs research and development focused on virtual environments for focused on virtual environments for training, education, and training, education, and scientific/engineering data scientific/engineering data visualization.visualization.

www.vetl.uh.edu/www.vetl.uh.edu/

The Bottom Line: The Training The Bottom Line: The Training ProcessProcess

Conduct aTraining Needs

Analysis

Conduct aTraining Needs

Analysis

DevelopTraining

Objectives

DevelopTraining

Objectives

Develop TrainingContent and

Methods That AreBased on Training

Objectives andSensitive toParticipant

Characteristics

Develop TrainingContent and

Methods That AreBased on Training

Objectives andSensitive toParticipant

Characteristics

Presentthe

Training

Presentthe

Training

Evaluate TrainingProgram

Effectiveness inRelation to

Original TrainingObjectives

Evaluate TrainingProgram

Effectiveness inRelation to

Original TrainingObjectives

Performance AppraisalPerformance Appraisal

Performance appraisalPerformance appraisal is the process of is the process of measuring employee performance against measuring employee performance against established goals and expectations.established goals and expectations.

Why Appraise Performance?Why Appraise Performance?

PerformanceAppraisal

As input to Promotion,Salary, and

Termination Decisions

To Give EmployeesDevelopmental

Feedback

To MotivateEmployees to MeetPerformance Goals

To Check on theImpact of New

Policies and Programs

Guidelines for Improving Guidelines for Improving Performance AppraisalsPerformance Appraisals

Ensure that the performance appraisal measure is Ensure that the performance appraisal measure is reliable and valid.reliable and valid.

Provide training for raters.Provide training for raters. Involve employees in the process.Involve employees in the process. Make sure the performance ratings are discussed.Make sure the performance ratings are discussed. Develop an action plan based on the discussion.Develop an action plan based on the discussion. Attempt to link merit increases to performance Attempt to link merit increases to performance

ratings.ratings. Integrate performance evaluation into the broader Integrate performance evaluation into the broader

process of day-to-day performance management.process of day-to-day performance management.

Types of Performance MeasuresTypes of Performance Measures With With trait approachestrait approaches, employees are rated on , employees are rated on

such traits as friendliness, efficiency, and such traits as friendliness, efficiency, and punctuality. The assumption is that these traits are punctuality. The assumption is that these traits are related to performance. Trait approaches suffer related to performance. Trait approaches suffer from a variety of problems, and should never be from a variety of problems, and should never be used alone.used alone.

With With behavioral approachesbehavioral approaches, such as the critical , such as the critical incidents method and behaviorally anchored rating incidents method and behaviorally anchored rating scales, employees are rated on specific actions.scales, employees are rated on specific actions.

With With outcome approachesoutcome approaches, employees are rated , employees are rated on what they are supposed to accomplish on the on what they are supposed to accomplish on the job.job.

Performance Reviews at Northern Performance Reviews at Northern States PowerStates Power

Northern States Power Company is Northern States Power Company is committed to achieving the benefits committed to achieving the benefits of workplace diversity.of workplace diversity.

Its annual performance reviews now Its annual performance reviews now include an assessment of how well include an assessment of how well an individual creates an environment an individual creates an environment that cultivates workforce diversity.that cultivates workforce diversity.

The reviews also measure each The reviews also measure each person’s active participation in person’s active participation in meeting departmental diversity meeting departmental diversity goals.goals.

360360oo Feedback Feedback Many firms are now using Many firms are now using 360-degree feedback360-degree feedback.. With 360-degree feedback, the employee receives With 360-degree feedback, the employee receives

feedback from four sources: the supervisor, feedback from four sources: the supervisor, subordinates, peers or coworkers, and self-ratings.subordinates, peers or coworkers, and self-ratings.

The Bottom Line: The Performance The Bottom Line: The Performance Appraisal ProcessAppraisal Process

CommunicatePerformanceExpectations

toEmployees

CommunicatePerformanceExpectations

toEmployees

DocumentObservationsof EmployeePerformance

During theAppraisal

Period

DocumentObservationsof EmployeePerformance

During theAppraisal

Period

UseDocumented

Observations of EmployeePerformanceto Complete

Ratings

UseDocumented

Observations of EmployeePerformanceto Complete

Ratings

Ask Employeeto Submit a

Self-Evaluation of

His or HerPerformance

Ask Employeeto Submit a

Self-Evaluation of

His or HerPerformance

Start the PerformanceAppraisal Session byEstablishing Rapport

with the Employeeand by Explaining theProcess to Him/Her

Start the PerformanceAppraisal Session byEstablishing Rapport

with the Employeeand by Explaining theProcess to Him/Her

Present theCompleted Rating

Form to theEmployee and

Explain the Basis forthe Ratings

Present theCompleted Rating

Form to theEmployee and

Explain the Basis forthe Ratings

Work with theEmployee to Develop

and Implement anAction Plan for

Improving His or HerJob Performance

Work with theEmployee to Develop

and Implement anAction Plan for

Improving His or HerJob Performance

Job Analysis, Job Specification, Job Job Analysis, Job Specification, Job Description, and Performance Description, and Performance

StandardsStandards Job AnalysisJob Analysis is the systematic study of a job to is the systematic study of a job to

determine its characteristics.determine its characteristics. A A job specificationjob specification is a summary of the is a summary of the

qualifications needed in a worker for a specific qualifications needed in a worker for a specific job.job.

A A job descriptionjob description is a short summary of the is a short summary of the basic tasks making up a job.basic tasks making up a job.

Performance standardsPerformance standards define the goals to define the goals to be achieved by a worker over a specified period be achieved by a worker over a specified period of time.of time.

Pay SystemsPay Systems SenioritySeniority: : Pay is linked to years of service. The Pay is linked to years of service. The

idea is that seniority reflects loyalty to the company idea is that seniority reflects loyalty to the company as well as valuable experience.as well as valuable experience.

Individual performanceIndividual performance:: Individual employees Individual employees are paid on the basis of how well they do on the are paid on the basis of how well they do on the job. With a job. With a piece-ratepiece-rate system, total wages are system, total wages are tied directly to output. These have strong tied directly to output. These have strong motivational effects. motivational effects.

Group performanceGroup performance: : How much each person How much each person makes is based on how well the group as a whole makes is based on how well the group as a whole does. Such systems encourage cooperation, and does. Such systems encourage cooperation, and may give group members an incentive to push slow may give group members an incentive to push slow workers to do better. workers to do better.

Guidelines for Basing Pay on Guidelines for Basing Pay on Individual or Group PerformanceIndividual or Group Performance

Appropriately link pay to performance.Appropriately link pay to performance. Use pay-for-performance as part of a Use pay-for-performance as part of a

broader human resources management broader human resources management system.system.

Build employee trust and promote the belief Build employee trust and promote the belief that performance makes a difference.that performance makes a difference.

Use multiple layers of rewards.Use multiple layers of rewards. Increase employee involvement.Increase employee involvement. Include nonfinancial incentives.Include nonfinancial incentives.

Pay Systems (Continued)Pay Systems (Continued) Plantwide or company productivityPlantwide or company productivity: : Employee pay rates Employee pay rates

are based in part on the productivity of the entire plant or are based in part on the productivity of the entire plant or organization. One form is the organization. One form is the Scanlon PlanScanlon Plan, in which groups , in which groups of employees suggest to management how productivity might of employees suggest to management how productivity might be improved and are given bonuses if the suggestions help.be improved and are given bonuses if the suggestions help.

Organization-basedOrganization-based:: These include plans such as These include plans such as profit-profit-sharing planssharing plans, under which employees get a bonus if , under which employees get a bonus if company profits are high, and company profits are high, and employee stock option employee stock option plans (ESOPS)plans (ESOPS), which reward employees with company , which reward employees with company stock. Organization-based plans give companies flexibility to stock. Organization-based plans give companies flexibility to make payments when they can be afforded and may result in make payments when they can be afforded and may result in positive employee attitudes toward the company, but have positive employee attitudes toward the company, but have little impact on individual performance.little impact on individual performance.

The Wage Determination ProcessThe Wage Determination Process(Figure 12-6)(Figure 12-6)

PerformanceStandards

PerformanceAppraisal

Payments toEmployee

PaySystem

LocalWages

Local WageLevel

WageSurveys

Job Descriptionand Evaluation

JobAnalysis

JobEvaluation

MarketConditions