Human Resource Management

Introduction to HRM

Activities undertaken to attract, develop, and maintain an effective workforce within an

organization.

• The people who make up and organization give that organization its primary source of competitive advantage.

• Human Resource Management plays a key role in finding and developing the organizations people as human resources that contribute to and directly affect company success.

Introduction to HRM

• Organizational performance is impacted in a positive way from HRM.

• HRM professionals are considered key players in the management team. No longer just ‘personnel’.

• As organizations flatten out more responsibility is pushed down. Today’s business leaders will deal with HRM.– Recruiting, developing, performance appraisals are

examples of things being pushed down.

The Strategic Goals of HRM

• Three Primary Goals all Influence by Strategy

Attract and Effective Workforce HRM Planning Job Analysis Forecasting Recruiting Selecting

Develop an Effective Workforce Training Development Appraisal

Maintain an Effective Workforce Wage and Salary Labor Relations Terminations

Environmental Influences on HRM

• “Our people are our most important resource”

• You must find, recruit, train, nurture, and retain the best people.– Without them (people) your strategy and

structure does not mean anything!

Environmental Influences

• Competitive Strategy• Federal Legislation• Trend in society

Competitive Strategy• Organization competitive strategy may

include merges and acquisition, downsizing to increase efficiency, international operation.

• These strategic decision determine the demand of skills and employees.

• The human resource strategy in return, must include the correct employee markup to implement the organizational strategy.

Federal Legislation

• In the past 40 years several laws have been passed to ensure equal employment opportunities (EOO).– Purpose: Stop unfair discriminatory practices that are

unfair to a specific group and define enforcement agencies to enforce the laws.

• Discrimination: the hiring or promoting of applicants based on criteria that are not job relevant.

• Affirmative Action: a policy requiring employers to take positive steps to guarantee equal employment opportunities for people within protected groups.

Federal Legislation

• Equal Employment Opportunity Commission (EEOC)– Enforcement agency for Federal Legislation regarding

discrimination

• Example: Age Discrimination in Employment Act (ADEA)– Age 40 or older– Employers with 40 or more employees– Damages:

• Back Pay

• Front Pay

• Can recover costs and fees

• No compensatory or punitive damages covered

Trend In Society• Trend include every thing from court decision

that rule against company that fire employees to dramatic change.few important trends are:

• Globalization:as firm compete globally HR executive must deal with staffing concern.

• Work force diversity: hiring decision of employees with discrimination of color, race , religion or cast.

• Labor supply fluctuation: as changing demographic and economic condition affect labor supply.in terms of shortage or oversupply.

• Employment at will: this rule traditional permitted an employer to fire the employee for just cause or even no cause.

• Now 40 states have written law to severely limit that “at will” to protect against wrongful firing of employees who refuse to violate a law or who expose an illegal action by their employers.

• Employees flexibility:to obtain quality employees and reduce excess employees coat firm can competitive in global market.

• Greater use of part time employees• Employees leasing and temporary employees.

Attracting an Effective Workforce

The first goal of HRM is to attract individuals who show signs of becoming valued, productive, and satisfied employees.

• Human Resource Planning– Need to predict the need for new employees

based on the types of vacancies that exist or need for new employees

Human Resource Planning• Human Resource Planning: The forecasting of

human resource needs and the projected matching of individuals with expected job

vacancies.– What will the volume of business likely be in five to

ten years?– What is the turnover rate? How much can be

avoided?– How many engineers will we need?– Can temporary labor be used?

Recruiting

• Recruiting: the activities or practices that define the desired characteristics of

applicants for specific jobs.• Finding and attracting capable applicant

for job,– Can be external or internal– Internal:

• Less costly, generates higher employee commitment, development, and satisfaction.

– External:• Acquire knowledge, skills, and abilities not

available internally

Realistic Job Previews give the applicant all pertinent information-positive and negative- about the job and the organization.– Enhance satisfaction and reduce turnover

since individuals can be properly matched up with a job and organization which suits them.

• Ensure that all practices are compliant with EEO

• Certain groups of people are part of a ‘protected group; which indicates that they are underrepresented in the workplace.– Age– Disabilities– Race

Selecting• Select the desired employees from the pool

of applicants.• The process of determining the skills and abilities, and other attributes a person needs

to perform a particular job.• A good place to start in making a selection

decision is job description.• job description: a listing of duties as well as

desirable qualification for a particular job.

Selection devices: several devices are used to assessing applicant qualification.

Application Form: a device for collecting information about education, previous job experience and other

back ground characteristics.

Interview• Two way communication for each to gather

information (individual, phone, panel, electronic)– Employment Test

• Intelligence tests, aptitude and ability tests, personality inventories

– Assessment Center• 2 or 3 day period to do simulated managerial

tasks.

Developing an Effective Workforce

• Training and Development• Performance Appraisal

Training and Development• Training and development represent a

planned effort by an organization to facilitate employee’s learning of job-related behaviors.

– Most Common Method is On The Job Training OJT• A type of training in which an experienced

employee ‘adopts’ a new employee to teach them how to perform job duties.

– Mentoring• Experienced employee works with a new employee to

provide guidance, support and learning opportunities

– Orientation Training: new comer are introduced to the organization’s culture standards and goals.

– Classroom Training: include lecture , films, audio visual techniques, and simulation.

– Programmed and computer-assisted instructions:

The employee work on his/her own place to learn material from the text that included exercise and quiz.

Conference and group decisions:participant analyze case or discuss topics assisted by a training leader.

• Promoting from Within– Another way to further employee

development is through promotion from within; this helps companies retain valuable employees.

• Provide challenging assignments• Prescribes new responsibilities• Help employee grow by expanding and

developing their abilities.

Performance Appraisal

• The process of observing and evaluating an employee’s performance, recording the assessment, and providing feedback to the employee.– Give feedback and praise concerning the acceptable

elements of the employee’s performance.– Describe performance areas that need improvement.– Reward through merit pay, recognition, and other

rewards.

• Make accurate use of rating scales and assessment systems

Assessing Performance Accurately

• Jobs are multidimensional and performance is also multidimensional.360-degree feedback– A process that uses multiple raters, including

self-rating, to appraise employee performance and guide development.

• Supervisors, co-workers, customers and other individuals as applicable. Gives you a full picture of who you are from various perspectives.

Performance Evaluation Errors

• Train managers how to use the performance appraisal interview.– Some mistakes:

• Stereotyping: placing an employee into a class or category based on one or a few traits or characteristics.

• Halo Effect: when an employee receives the same rating on all dimensions regardless of his or her performance.

• Behaviorally Anchored Rating Scale: a rating technique that relates an employees performance to specific job-related incidents.– Each incident of dimension gets its own bar and

rating.

– Performance appraisal interviews:– A formal review of an employee’s performance

conducted between the superior and the subordinate.

Maintain an Effective Workforce

• Compensation• Benefits• Termination

Compensation

• Compensation: monetary payments (wages, salaries) and non-monetary goods/commodities (benefits, vacations) used to reward employees.

– Money– Health Insurance– Paid Vacations– Employee Fitness Centers– Memberships in Clubs– Corporate Jet

• Helps to attract and retain employees.• The compensation package should fit the company

strategy and should provide compensation equity.

Compensation Equity

• Maintain a sense of fairness and equity within the pay structure.– Job Evaluation: will allow the

organization to determine the value of jobs within the organization through the examination of job content.

CompensationPay and Performance

• Some compensation is developed based on a pay for performance standard.– A portion of compensation is tied to effort and

performance.• Can be compensated with:

– Bonuses

– Incentives

– Profit sharing

– Stock

• Should be linked to company strategy!

Wage and Salary structure • Point system:job evaluation system that

assign a predetermine pint value to each compassable job factor in order to determine the worth of given job.– Wage and Salary Surveys: will allow the

organization to pay incumbents competitively with what other firms are offering.

Termination• Organizations lose employees due to

– Retirement

Mergers• What is the companies responsibility? If any?

– Leave for other opportunities

• Use an exit interview to determine the reasons for leaving. It will provide you with an inexpensive way to learn about pockets of dissatisfaction within your organization. (This will help reduce future turnover for the same reasons!)

• Some are terminated. WHY?– Productive employees resent disruptive, low-performing

employees who are allowed to stay with the company and receive pay and benefits comparable to others.

• Poor Performance