PART TWO EMPLOYMENT Chapters 5-7

Chapter 5 Planning for People McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.

Questions This Chapter Will Help Managers Answer How can business strategy be integrated with strategic workforce planning? How might job-design principles and job analysis be useful to the practicing manager? What is strategic workforce planning, and how should I begin that process? How can organizations balance “make” versus “buy” decisions with respect to talent? How should organizations manage leadership succession?

Business Strategy – Foundation For All Organizational Decisions Strategy formulation answers the basic question, “How will we compete?” Strategy analysis defines the crucial elements for the strategy’s success In strategy implementation, firms take the necessary actions to implement their strategies How firms compete with each other and how they attain and sustain competitive advantage is known as strategic management

Ensuring Coherence in Strategic Direction SMART objectives - Specific, Measurable, Appropriate, Realistic, Timely Business strategy provides an overall direction and focus for the organization as a whole, including for each functional area of the business

Human Resource Strategy A set of priorities a firm uses to align its resources, policies, and programs with its strategic business plan

Relationship Of HR Strategy To Business Strategy High-performance work practices include the following features: Pushing responsibility down to employees operating in flatter organizations Increased emphasis on line managers as HR managers Instilling learning as a priority Decentralizing decision making to autonomous units and employees Linking performance measures for employees to financial performance indicators

Figure 5–1: The Relationship of HR Strategy to the Broader Strategy of a Business

Figure 5-2 Impact of Three Levels of Business Planning on Workforce Planning

Questions to Ask in Managing People to Work Efficiently Who specifies the content of each job? Who decides how many jobs are necessary? How are the interrelationships among jobs determined and communicated? Has anyone looked at the number, design, and content of jobs from the perspective of the entire organization? What are the minimum qualifications for each job? What should training programs stress? How should performance on each job be measured? How much is each job worth?

Job Analysis and Job Design Job analysis describes the process of obtaining information about jobs Job design focuses on the processes and outcomes of how work is structured, organized, experienced, and enacted.

Scientific Management “One Best Way” The dominant approach to job design in the industrial society of the 20th century Frederick W. Taylor was its prophet Taylor believed that once the best way to perform work was identified, workers should be selected on the basis of their ability to do the job, trained in the standard way to perform the job, and offered monetary incentives to motivate them to do their best This approach to designing work is fully consistent with a cost-leadership business strategy

Job Description and Job Specification Job description is an overall written summary of task requirements Job specification is an overall written summary of worker requirements

Job Analysis and the Americans with Disabilities Act of 1990 Job analyses are not legally required under the ADA, but professional practice suggests they be done for three reasons: Applicants must be able to understand what the functions of a job are before they can respond to the question “Can you perform the essential functions of the job for which you are applying?” Existing job analyses may need to be updated to reflect additional dimensions of jobs A written job description may result in some candidates self-selecting out

Competency Models Competency models attempt to identify variables related to overall organizational fit and identify personality characteristics consistent with the organization’s vision and mission (e.g., drive for results, persistence, etc.)

Methods of Job Analysis Structured questionnaires Critical incidents Observation Interview Job performance

Categories in the Position Analysis Questionnaire (PAQ) Information input Mental processes Work output Relationship with other persons Job context Other job characteristics

Table 5–2: Job Analysis Methods And The Purpose(s) Best Suited To Each

Strategic Workforce Planning An effort to anticipate future business and environmental demands on an organization, and to provide qualified people to fulfill that business and satisfy those demands

Figure 5–7: An integrated, strategic workforce planning system

Activities That Comprise an SWP System A talent inventory A workforce forecast Action plans Control and evaluation

Workforce Forecasts Forecasting external workforce supply Agencies regularly make projections of external labor market conditions and estimates of the supply of labor Organizations find such projections helpful Forecasting internal workforce supply The simplest type is the succession plan The overall objective is to ensure the availability of competent executive talent

Leadership-Succession Planning Five key lessons: The CEO must drive the talent agenda Identify and communicate a common set of leadership attributes Use performance reviews as the building block for assessment, development, and management consensus about performance and potential Keep to a schedule for performance reviews, broader talent reviews outside one’s functional area, and the identification of talent pools Link all decisions about talent to the strategy of the organization

Forecasting Workforce Demand Identify pivotal talent Assess future workforce demand Accuracy in forecasting the demand for labor varies considerably by firm and by industry type: roughly from 5 to 35 percent error factor

Make or Buy? Guidelines for determining when “buying” is more effective than “making:” How accurate is your forecast of demand? If not accurate, do more buying Do you have the “scale” to develop? If not, do more buying Is there a job ladder to pull talent through? If not long, do more buying How long will the talent be needed? If not long, do more buying Do you want to change culture/direction? If yes, do more buying

Control And Evaluation of SWP Systems Quantitative objectives make the control and evaluation process more objective and measure deviations from desired performance more precisely In newly instituted SWP systems, evaluation is likely to be more qualitative than quantitative, with little emphasis placed on control The advantage of quantitative information is that it highlights potential problem areas and can provide the basis for constructive discussion of the issues

Leadership Succession – A Key Challenge For All Organizations Key steps to take to avoid a future crisis in leadership succession: Ensure that the sitting CEO understand the importance of this task and makes it a priority Focus on an organization’s future needs, not past accomplishments Encourage differences of opinion Provide broad exposure Provide access to the Board

Key Terms Discussed in This Chapter Job analysis Job design Job description Job specification Competency models SMART objectives Business strategy Competencies HR strategy Workforce forecasting Succession planning Strategic workforce planning