Chapter Thirteen Human Resource Management © 2007 The McGraw-Hill Companies, Inc., All Rights Reserved. McGraw-Hill/Irwin Introduction to Business

Human Resource Management (HRM) Systems Human resources – all the people that a business employees Human resource management -the set of activities designed to recruit high- quality employees and then improve their skills and capabilities

The Five Components of the HRM System Figure 13.1

Recruitment and Selection Recruitment - the process of identifying and attracting a pool of qualified applicants Selection – involves creating the set of criteria that determines which job applicants are the best match for a particular job

External and Internal Recruitment Internal recruitment -a policy of promoting employees who already work for a company External recruitment -a policy of filling advanced job positions with applicants from outside the company

The Selection Process Step 1: Screening applications and résumés Step 2: Applicant testing and reference checks Step 3: The interview process Step 4: Making the final selection Sample interview questions

The Four Steps in the Selection Process Figure 13.3

The Interview Process Structured interview -all applicants are asked a series of standard questions Nondirective interviews -questions are open ended to give applicants ample opportunity to reveal skills, abilities, strengths, and weaknesses

Types of Standardized Tests Figure 13.4

Training and Development -the process through which companies increase their employees’ work skills and knowledge to improve their job performance

Training-Needs Analysis Training-needs analysis -a method of identifying the kinds of employee training that will result in the greatest performance gains Training gap -a specific type training an employee needs to acquire

Training-Needs Analysis Figure 13.5

Types and Methods of Training and Development On-the-job training -training employees receive in the course of doing their jobs

Methods of Training and Development Figure 13.6

The Components of a Human Resource Management System Performance appraisal -the task of accurately identifying differences in the level and quality of work employees do and providing them with feedback that increases their performance levels

Performance Appraisal and Feedback Performance appraisal -the process of evaluating the contributions an employee has made toward a company’s functional and corporate-wide goals Performance feedback -the communication of performance appraisal information to employees to influence their future performance levels

Performance Appraisal Methods Managers can evaluate: 1)Results or outcomes of an employee’s activities 2)Specific employee actions or behaviors that produced those outcomes

Who Appraises Performance? Figure 13.7

Who Appraises Performance? 360-degree performance appraisal -the process of using multiple sources of information to appraise an employee’s performance

Giving Performance Feedback Formal appraisals -appraisals conducted on a regular basis to provide employees with ongoing performance feedback Informal appraisals -appraisals that take place as managers and subordinates meet from time to time to discuss important work issues

Pay and Benefits Pay -the monetary rewards, such as wages, bonuses, and salaries, associated with a particular job Benefits -the monetary rewards, such as paid health care, life insurance, sick and vacation pay, and pensions, employees receive because they are a member of a company

Pay and Benefits Pay structure -the relative pay and benefits received by employees doing different types of jobs or jobs at different levels in a company’s hierarchy Pay level -the average salary a company chooses to pay its employees compared to other companies in its industry

Types of Incentive Pay Incentive pay -the extra rewards employees receive when they achieve specific work goals

Individual Incentive Plans Piecework plans -pay plans that link the pay employees receive to the number of units of a product an employee makes Commission systems -pay plans that link the pay employees receive to the amount of revenue they earn by selling a company’s products

Individual Incentive Plans Merit pay -a pay system that links superior performance directly to higher permanent rewards, such as a certain percentage increase in salary Bonus pay -a one-time reward employees receive for accomplishing a specific goal

Group and Companywide Reward Systems Profit sharing plans -pay plans that reward employees on the basis of the profit a company earns in a particular period Employee stock ownership plan -a plan that allows employees to buy a company’s shares at below-market prices

Group and Companywide Reward Systems Organization bonus systems -the one-time rewards employees receive if a company achieves cost savings, quality increases, and so on, in a specified time period

The Components of a Human Resource Management System Labor relations -the process of working with employees, or the unions that represent them, to create work rules and a negotiation process to resolve disputes between them

Labor Relations Labor relations -the process of establishing rules and practices between a company and its employees that specify how human resources should be employed and rewarded

Labor Relations Trade unions -organizations that represent the interests of employees who hold similar types of jobs in a particular industry

Competition and Cooperation among Stakeholders Figure 13.8

Union-Management Relations Industrial conflict -the clash that occurs when workers and unions attempt to obtain a greater share of a company’s profits at the expense of other stakeholders Working-to-rule -when workers perform their jobs exactly as specified in their employment contracts but do no more

Union-Management Relations Lockout -when managers decide to shut down a company’s operations until workers are willing to accept the employment conditions being offered to them Strike -a situation that arises when workers refuse to do their jobs in an attempt to bring the work process to a halt

Collective Bargaining: Resolving the Conflict Collective bargaining -the process through which union representatives and managers negotiate a binding labor agreement over work-related issues, such as pay, benefits, and grievance procedures

Collective Bargaining: Resolving the Conflict Integrative bargaining solution -a “win-win” solution that allows both parties to benefit from the labor contract agreed upon Attitudinal structuring -the attempt by negotiators on each side to influence each other’s attitudes during the bargaining process

Collective Bargaining: Resolving the Conflict Grievance procedures -labor-contract rules used to resolve labor disputes between companies and their employees

Collective Bargaining: Resolving the Conflict Mediation -a conflict resolution method that involves the use of a neutral third party, or mediator, to help labor and management resolve their differences and reach an agreement

Collective Bargaining: Resolving the Conflict Arbitration -a conflict resolution method that involves the use of a third party to negotiate and impose a binding agreement on labor and management

Human Resource Planning Human resource planning -the process of forecasting the type and number of employees a company will require in the future to meet the objectives of its business model

Human Resource Planning Job analysis -the process of obtaining detailed information about the tasks and responsibilities involved in each job in a company

Human Resource Planning Job description -a list of the specific tasks, duties, and responsibilities that make up a particular job Job specifications -a written list of the required skills, abilities, and knowledge needed to do a particular job

Technical Sales Representative Figure 13.2