PowerPoint Presentation by Charlie Cook The University of West Alabama Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. M ANAGING H UMAN R ESOURCES HR Planning for Alignment and Change Chapter 4

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–24–2 The Strategic Importance of HR Planning for Alignment and Change To succeed under new competitive conditions, companies must change vision, values, structure, strategy and corporate culture. Changes in HR policies and practices encourage and support behaviors needed for organizational change.

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–34–3 Alignment with Environmental Change 1) Changing global labor market 2) New customer demands 3) Increased competition 4) New regulation 5) New technologies 6) Growth of the internet 7) Fundamental change in the structure and dynamics in the industry

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–44–4 Alignment Vertical alignment  Exists when the HRM system fits with all other elements of the organizational environment—the culture, strategy, structure, and so on. Horizontal alignment  Exists when all the HR policies and practices that comprise the HRM system are consistent with each other so that they present a coherent message to employees concerning how employees should behave while at work.

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–54–5 Types of Organizational Change Major transformations in the structure, size, or functioning of an organization for the purpose of achieving strategic objectives. Degree of Change:  Radical change Major adjustments in the ways a firm does business  Incremental change: Evolves over time from many small routine changes

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–64–6 Timing of Change Reactive Change:  Occurs when an organization is forced to change in response to some event in the external or organizational environment. Radical or incremental Anticipatory Change  When an organization takes action in anticipation of upcoming events or early in the cycle of a new trend. Often incremental

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–74–7 Learning Organizations Learning Organization  Continually finds new ways to satisfy customers and other stakeholders by integrating information resources, technology, and people to produce and then effectively use new knowledge. Constantly changing through experimentation and learning from others. Planning ensures the HRM system provides learning opportunities to build competencies and keeps employees motivated and interested in learning.

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–84–8 Aligning Human Resource Management in Learning Organizations EX 4.1

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–94–9 Elements of HR Planning Human Resource Planning Activities  Scanning and assessing the external and organizational environments.  Specifying the objectives to be achieved by HR activities along with the measures to be used to assess the achievement of those objectives.  Developing specific plans for HR policies and practices, along with timetables for implementing those plans.

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–10 Scanning and Assessing the External and Organizational Environment Economic conditions Political landscape Regional Trade Zones Technology Industry Dynamics Labor Markets Country Cultures Laws and Regulations Unions and Labor Relations

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–11 Organizational Analysis  An assessment of the external and internal environments Organizational Analysis Methods  HR forecasts  Employee opinions  HR cause-and-effect models

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–12 Organizational Analysis (cont’d) HR Forecasts  Estimates of the firm’s future human resource needs  Judgmental forecasts Informed experts predict business trends  Statistical forecasts Rely on objective data and formal models Use historical data to predict the future

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–13 Employee Opinions Asking about problems and potential solutions:  Employee surveys  Focus groups  Involving employees in developing HR plans

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–14 Behavioral Cause-and-Effect Models Provide insight into why employees behave as they do Identify the business consequences of employee behaviors Models show:  Cause-effect  Connection between HRM and strategic success

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–15 Considering Alternatives There are alternative ways to achieve strategic objectives.  Layoffs and reductions in force (RIFS)  Reducing turnover  Outsourcing  Offshoring

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–16 Considering Alternatives (cont’d) There are other alternatives to achieving strategic objectives.  For example, possible solutions to a labor shortage include: Raise base wages to attract more applicants Offer more financial incentives to boost productivity Reduce turnover rates to lessen the need for new hires Hire people without the skills needed and train them Buy up other companies to acquire their workforce Buy new technologies that require fewer workers Utilize foreign labor markets Make decisions that reduce the need for skilled workers

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–17 Building a Complete HR Plan A comprehensive HR plan for change is likely to have many components, just as a companywide plan for change has many components.  Staffing Plans  Talent Management Plans  Training Plans  Leadership Development Plans  Plans for Changes in Benefits

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–18 Staffing Plans: Ensuring Supply Matches Demand Succession Planning  Ensures key positions can be filled when vacancies occur Talent Pool  A list of employees with high potential for advancement Replacement Charts  Lists of key jobs, incumbents and names from employee talent pool

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–19 Timetables Challenges  Building deadlines and scheduling checkpoints to keep change moving.  Developing challenging but achievable deadlines.  Developing realistic expectations about change. Timelines for Developing Talent Timelines for Layoffs and Plant Closings  Worker Adjustment and Retraining Act of 1988 (WARN) 60 days’ advance notice of plant closings and layoffs covered under the act.

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–20 Implementing The HR Action Plans for Alignment: Facilitating Change Involving Employees  Task forces  Focus groups  Surveys  Hot lines  Informal conversations

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–21 Implementing The HR Action Plans for Alignment: Facilitating Change (cont’d) Change Has Already Started  Employee involvement  Two-way communication  Empowerment

Copyright © 2005 Thomson Business & Professional Publishing. All rights reserved. 4–22 Managing Resistance to Change Reasons for Resistance to Change  Fear  Misunderstandings  Cynicism Forms of Resistance  Criticism  Malicious compliance  Sabotage  Silence