Chapter 2Fundamentals of HRM

Human Resource Management

Management EssentialsManagement involves setting goals and allocating

scarce resources to achieve them.Management is the process of efficiently

achieving the objectives of the organization with and through people.

Management EssentialsPrimary Functions of Management

Planning – establishing goalsOrganizing – determining what activities need to be

doneLeading – assuring the right people are on the job

and motivatedControlling – monitoring activities to be sure goals

are met

Why is HRM Important to an Organization?The role of human resource managers has

changed. HRM jobs today require a new level of sophistication. Federal and state employment legislation has

placed new requirements on employers. Jobs have become more technical and skilled. Traditional job boundaries have become blurred

with the advent of such things as project teams and telecommuting.

Global competition has increased demands for productivity.

Why is HRM Important to an Organization?The Strategic Nature – HRM must be

a strategic business partner and represent employees.

forward-thinking, support the business strategy, and assist the organization in maintaining competitive advantage.

concerned with the total cost of its function and for determining value added to the organization.

Why is HRM Important to an Organization?HRM is the part of the organization concerned

with the “people” dimension. HRM is both a staff, or support function that

assists line employees, and a function of every manager’s job.

Why is HRM Important to an Organization?HRM Certification

Colleges and universities offer HR programs. The Society for Human Resource Management

and Human Resource Certification Institute offer professional certification.

Why is HRM Important to an Organization?

Four basic functions:

StaffingTraining and

DevelopmentMotivationMaintenance

How External Influences Affect HRM

Strategic EnvironmentGovernmental LegislationLabor UnionsManagement Thought

How External Influences Affect HRMHRM Strategic Environment includes:

GlobalizationTechnologyWork force diversityChanging skill requirementsContinuous improvementWork process engineeringDecentralized work sitesTeamsEmployee involvementEthics

How External Influences Affect HRMGovernmental Legislation

Laws supporting employer and employee actionsLabor Unions

Act on behalf of their members by negotiating contracts with management

Exist to assist workers Constrain managersAffect non unionized workforce

How External Influences Affect HRMManagement Thought

Management principles, such as those from scientific management or based on the Hawthorne studies influence the practice of HRM.

More recently, continuous improvement programs have had a significant influence on HRM activities.

Staffing Function ActivitiesEmployment planning

ensures that staffing will contribute to the organization’s mission and strategy

Job analysisdetermining the specific skills, knowledge and

abilities needed to be successful in a particular job defining the essential functions of the job

Staffing Function ActivitiesRecruitment

the process of attracting a pool of qualified applicants that is representative of all groups in the labor market

Selection the process of assessing who will be successful on

the job, and the communication of information to assist job

candidates in their decision to accept an offer

Goals of the Training and Development Function

Activities in HRM concerned with assisting employees to develop up-to-date skills, knowledge, and abilities

Orientation and socialization help employees to adapt

Four phases of training and developmentEmployee trainingEmployee developmentOrganization developmentCareer development

The Motivation FunctionActivities in HRM concerned with helping

employees exert at high energy levels.Implications are:

IndividualManagerialOrganizational

Function of two factors:AbilityWillingness

Respect

The Motivation FunctionManaging motivation includes:

Job designSetting performance standardsEstablishing effective compensation and benefits

programsUnderstanding motivational theories

The Motivation FunctionClassic Motivation Theories

Hierarchy of Needs –MaslowTheory X – Theory Y –McGregorMotivation – Hygiene – HerzbergAchievement, Affiliation, and Power Motives –

McClellandEquity Theory – AdamsExpectancy Theory - Vroom

How Important is the Maintenance FunctionActivities in HRM concerned with maintaining

employees’ commitment and loyalty to the organization.HealthSafetyCommunicationsEmployee assistance programs

Effective communications programs provide for 2-way communication to ensure that employees are well informed and that their voices are heard.

Translating HRM Functions into PracticeFour Functions:

EmploymentTraining and developmentCompensation/benefitsEmployee relations

Translating HRM Functions into PracticeEmployment - Employment specialists:

coordinate the staffing functionadvertising vacanciesperform initial screeninginterviewmake job offersdo paperwork related to hiring

Training and Development – help employees to maximize their potentialserve as internal change agents to the organizationprovide counseling and career development

Translating HRM Functions into PracticeCompensation and Benefits –

establish objective and equitable pay systemsdesign cost-effective benefits packages that help

attract and retain high-quality enployees.help employees to effectively utilize their benefits,

such as by providing information on retirement planning.

Translating HRM Functions into PracticeEmployee Relations – involves:

communicationsfair application of policies and proceduresdata documentation coordination of activities and services that enhance

employee commitment and loyaltyEmployee relations should not be confused with

labor relations, which refers to HRM in a unionized environment.

Translating HRM Functions into PracticePurpose and Elements of HRM Communications

Keep employees informed of what is happening and knowledgeable of policies and procedures.

Convey that the organization values employees. Build trust and openness, and reinforce company

goals.

Translating HRM Functions into PracticeEffective Communication programs involve:

Top Management CommitmentEffective Upward CommunicationDetermining What to CommunicateAllowing for FeedbackInformation Sources

Does HRM Really Matter?Research has shown that a fully functioning

HR department does make a difference. Organizations that spend money to have

quality HR programs perform better than those who don’t.

Practices that are part of superior HR services include:rewarding productive workcreating a flexible work-friendly environmentproperly recruiting and retaining quality workerseffective communications

HRM in an Entrepreneurial EnterpriseGeneral managers may perform HRM

functions, HRM activities may be outsourced, or a single generalist may handle all the HRM functions.

Benefits includefreedom from many government regulationsan absence of bureaucracyan opportunity to share in the success of the

business

HRM in a Global VillageHRM functions are more complex when

employees are located around the world. Consideration must be given to such things as

foreign language training, relocation and orientation processes, etc.

HRM also involves considering the needs of employees’ families when they are sent overseas.

HR and Corporate EthicsHRM must:

Make sure employees know about corporate ethics policies

Train employees and supervisors on how to act ethically

HR and Corporate EthicsThe Sarbanes-Oxley Act passed in 2002,

establishes procedures for public companies regarding how they handle and report their financial status. Establishes penalties for noncompliance. Provides protection for employees who report

executive wrongdoing. Requires that companies have mechanisms in

place where complaints can be received and investigated.