Managing Human Resources Chapters 13 Attracting and Retaining the Best Employees

Human Resource Management The process of hiring, developing, motivating, and evaluating employees to achieve organizational goals All the activities involved in acquiring, maintaining, and developing an organization’s human resources

Before Recruiting Human resources planning Determining the firm’s human resource needs Job analysis Determining the exact nature of the positions to be filled

Acquisition Attracting people to apply for positions in the firm Recruiting Attracting people to apply for positions in the firm Selection Choosing and hiring the most qualified applicants Orientation Acquainting new employees with the firm

Maintaining Employee relations Increasing employee job satisfaction through satisfaction surveys, communication programs, exit interviews, and fair treatment Compensation Rewarding employee effort through monetary payments Benefits Providing rewards to ensure employee well-being

Development Training and development Teaching employees new skills for more effective ways to do their present jobs and new jobs in the future Performance appraisal Assessing employees’ current and potential performance levels

Human Resource Management: HR planning and Job analysis Acquiring: Employee recruitment and selection Retainning and developing: Employee training, performance appraisal, and compensation Career managment Employment termination

Human Resource Management Process Strategies & objectives of the organization Acquiring HR planning & forecasting Job analysis & design Employee recruitment Employee selection Training & development Performance planning & evaluation Compensation & benefits retainning Organizational career management

HR planning & forecasting Job analysis & design Employee recruitment Employee selection HR planning: The development of strategies to meet a firm’s future human resources needs Demand forecast: Determining the number of employees needed by some future time Supply forecast (internal): Estimating the number of current employees who will be available to fill various jobs at some future time

Forecasting HR Demand Demand forecasts based on organizational goal and structure Factors affecting HR demand The firm’s overall strategic plan The firm’s past history of staffing levels Evolving technologies Industry staffing practices Projected economic trends

Forecasting HR Supply Factors affecting HR supply The firm’s present workforce and any internal changes or movements Evolving technologies Projected economic trends Supply forecasting techniques Replacement chart List of key personnel and their possible replacements within the firm Skills inventory Computerized data bank containing information on the skills and experience of all present employees

Matching supply with demand If demand is greater than internal supply, then the firm must recruit and select new employees If supply is greater than demand, then the firm must prepare plans to reduce the workforce through Layoffs: dismissing employees from the workforce until they are needed again Attrition: normal reduction of the workforce that occurs when employees leave the firm Early retirement: allowing or encouraging persons to retire early with full benefits Firing may be necessary to remove excess employees from the workforce

HR planning & forecasting Job analysis & design Employee recruitment Employee selection Job Analysis: A systematic procedure for studying jobs to determine their various elements and requirements A study of the tasks required to do a particular job well Studying a job to determine its tasks and duties for Setting pay Determining employee job performance Specifying hiring requirements Designing training programs

Job analysis determines the responsibilities of the position and qualifications needed job description job specification

Job description Lists the tasks and responsibilities of the job A list of the elements that make up a particular job Duties to be performed Working conditions The jobholder’s responsibilities The tools and equipment used on the job

Job Description (responsibilities) example: "Manage database components of large projects for the development of common process applications in Global Derivatives."

Job Description (example) Lead and manage a sales team to achieve sales target Develop territory and key account business. Identify market opportunities and develop / implement sales plans. Cultivate good business relationship with key customers. Co-work with marketing team to implement activities in market. Develop people and provide day-to-day coaching for sales team

Job specification A list of the qualifications required to perform a particular job Describes skills, knowledge, and abilities needed to fill the job described in the job description Skills Abilities Education Experience

Job Specifications (requirements) University graduate, MBA is a preferred but not essential. Experience with multi-national companies handling well known consumer products for more than 5 years. Leading sales teams in supervisory level (or above) for more than 3 years. Good English is definitely required. Proactive, aggressive, good team player, self-driven, innovative with strong commitment to drive good business result.

HR planning & forecasting Employee recruitment Employee selection HR planning & forecasting Job analysis & design Recruitment: The process of attracting qualified job applicants The attempt to find and attract qualified applicants Most firms begin by trying to fill the job from within If internal candidates are not available, an external search begins

Internal Recruiting Promotion or transfer Job posting may be required by policy or union contract Advantages Provides motivation for current employees Helps retain quality personnel Disadvantages Cost of filling the newly vacant position Cost of training another employee Internal conflicts

External Recruiting Sources Websites, newspaper ads, employment agencies, college campuses, union hiring halls, employee referrals, open houses, job fairs, walk-in applicants Advantages Fresh perspectives and varied backgrounds of new hires Attracting applicants with the required skills and knowledge Disadvantages Expense May cause resentment among existing employees

External Search Local media is used to find workers who are Non-technical Unskilled Non-supervisory Highly trained recruits are found by using College recruiters Executive search firms Job fairs Company Web sites

HR planning & forecasting Employee recruitment Employee selection HR planning & forecasting Job analysis & design Selection: The process of gathering information about applicants and then using that information to choose the most appropriate applicant The process of determining which people in the applicant pool possess the qualifications necessary to be successful on the job

the employee selection process Applicant submits an application or résumé Receives a short, structured interview Applicant may be asked to take an aptitude, personality, or skills test Selection interview In-depth discussion of applicant’s Work experience, skills, and abilities Education and career interests Applicants seeking professional or managerial positions may be interviewed by several people Successful applicants may be asked to undergo a physical exam

Steps of the Selection Process Initial screening Employment testing Selection interview Background and reference checks Physical examination Decision to hire

Provide useful factual information about the applicant Applications Provide useful factual information about the applicant Information gathered is used for Identifying applicants worthy of further consideration Familiarizing interviewers with applicant backgrounds

Resume Types Chronological: focus on experience, each job described in some detail, better with objective or summary, not good for career change Functional: highlights skills and accomplishments, good for career change, new comers, returning Combined: both chronological and functional, a shorter chronology following a short "Skills and Accomplishments" section, or with a longer Summary including a skills list or a list of "qualifications"); or a standard functional resume with the accomplishments under headings of different jobs held.

Sample Resume Format Personal Information: 　name, address, contact info　 Work Experience: chronological, position, responsibilities, achievements Education: Activities: Skills and Qualifications Others　

Resume Related Issues Job Objective:? (all leading to position applied) Chinese Name/ English Name Last school and major and degree? Education: Main Courses Extra-curriculum (Social) Activities: Hobbies? English / Computer organization skills, communications, team players, leading abilities, working habits, ……

Employment Tests Aptitude, skills, abilities, and knowledge relevant to the job Job-related and validated as an accurate predictor of job performance, to be nondiscriminatory

Interview The most widely used selection technique Can probe more deeply into attitudes and motivation A structured interview format, to be nondiscriminatory Ask all candidates the same questions All questions should be job-related Avoid personal bias

Interviews attitudes: on time, attentiveness, active participation group interview: attitudes: on time, attentiveness, active participation behavior: professional, value, character skills and abilities: potential, ... individual interview: with different people: audience analysis with detailed info: ability-responsibility match

Reference Check References Used to verify information furnished by the applicant about skills, abilities and achievements about potentials and characters about previous job responsibilities and the reason for leaving their previous job

Hiring offer: acceptance: sign and report to work position, title, location, responsibilities, direct reports salary, benefits probationary period acceptance: sign and report to work

Orientation The process of acquainting new employees with an organization Topics Range from location of company cafeteria to career paths within the firm May be brief and informal or long and formal

Training and Development: Training & development Performance planning & evaluation Compensation & benefits Training and Development: Employee training Management development

Employee Training The process of teaching operations and technical employees how to do their present jobs more effectively and efficiently Activities that provide learning situations in which an employee acquires additional knowledge or skills to increase job performance, or to foster job improvement

Management Development The process of preparing managers and other professionals to assume increased responsibility in both present and future positions

Program Design Analysis of the needs of the organization for training and development Is training needed? What kind of training is needed? Is motivation needed? What kind of training is expensive; be sure it is appropriate.

Program Design Determination of training and development methods by which to deliver the program On-the-job New employee learns by working under the supervision of experienced employee Simulation Training in an area that replicates the actual work environment without the production pressures Classroom teaching and lectures For large groups who need the same information (e.g., notification of change in benefits) Conferences and seminars Experts and learners meet to discuss problems and exchange ideas Role playing Acting out the roles of others in the organization for a better understanding of others

Program Design Job rotation Executive education programs Mentoring Determination of training and development methods by which to deliver the program Job rotation Executive education programs Mentoring Special project assignments

Program Design Creation of evaluation system to assess the program’s effectiveness Before training, develop a set of verifiable objectives that specify what is expected and how the results are to be measured Measure or verify training results Make the results known to all those involved in the program—including trainees and upper management

Performance planning & evaluation process: Training & development Performance planning & evaluation Compensation & benefits Performance planning & evaluation process: Performance planning: Setting standards & expectations Employee job task behavior Performance evaluation Rewards & job changes

Performance Appraisal Compares an employee’s actual performance with the expected performance The evaluation of an employee’s current and potential levels of performance to allow managers to make objective human resource decisions

Uses of Performance Appraisal Let workers know how they are doing and how they can do better Provide the basis for Compensation Training needs Advancement opportunities Rewards Help the organization monitor selection, training, and development activities

Common Evaluation Techniques Objective methods based on measurable quantity (e.g., units of output, sales volume, number of defective products, % change in performance). Judgmental methods Managerial estimates of employee performance levels Ranking Ordering employees from best to worst Difficult to use because there is no absolute standard and differences in performance of ranked employees is not apparent Rating Using a predetermined scale (standard) to evaluate each employee’s performance

To Avoid Appraisal Errors Use the entire evaluation instrument; avoid focusing on one portion Do not let an employee’s poor performance in one area influence the evaluation of other areas of performance Evaluate the entire performance period and not the most recent behaviors of the employee Guard against any form of personal bias or discrimination in the evaluation

Performance Evaluation 360° Evaluation: performance feedback that combines self-appraisal with ratings made by coworkers at the same level, above, and below the target person in the managerial hierarchy Advantages: provides a well-rounded view avoids individual bias can have more impact than a single source can establish consensus Disadvantages: time consuming

360° Evaluation: Participants: Questions: Rating: self, manager, colleague, direct reports Questions: impressions most admired areas need to stop, start, continue Rating: responsibility, trustworthiness, honesty, accountablility, ... drive, passion, result-oriented, process-management, ... people development, team building, communication, ...

Performance Feedback Performance appraisal information should be provided to employees Most often through a performance feedback interview Tell and sell: Superior tells the employee how well or poorly the employee is performing and attempts to persuade the employee to accept the evaluation Tell and listen: Supervisor tells the employee about his or her performance and then gives the employee a chance to respond Problem-solving approach: Employee evaluates own performance and sets own goals; supervisor offers comments and goals are mutually established Mixed interview 360-degree evaluation: Employee is provided feedback from evaluations by his superiors, peers, and subordinates

Effective employee reward systems must Training & development Performance planning & evaluation Compensation & benefits Effective employee reward systems must Enable employees to satisfy their basic needs Provide rewards comparable to those offered by other firms Be distributed fairly in the organization Recognize that different people have different needs

How are employees compensated? Direct pay Hourly wage or monthly salary paid to an employee May include bonuses and profit shares Indirect pay Various benefits and services Required by law: unemployment and worker’s compensation, Social Security Optional: paid vacations and holidays, pensions, health and other insurance products, employee wellness programs, college tuition reimbursement

Compensation Decisions The payment employees receive in return for their labor Compensation system The policies and strategies that determine employee compensation Wage level The firm’s choice to position its general level of pay at, above, or below the market (prevailing wage) for an industry or a geographic area Wage survey—a collection of data on prevailing wage rates within an industry or geographic area.

Compensation Decisions Wage structure The internal compensation structure that sets the relative pay levels for all the positions in the firm Job evaluation—the process of determining the relative worth of the various jobs within the firm Ranking jobs according to their value to the firm Job analysis using a point system to value jobs Individual wages Decisions on specific wage payments to individual employees are based on The wage range for the individual’s job The individual’s proficiency, experience, and performance

Types of Compensation Hourly wage The amount of money paid for each hour of work Salary The amount of money paid for an employee’s work during a set calendar period, regardless of the number of hours worked Commissions Payments based on a percentage of sales revenue Incentive payment A payment in addition to wages, salary, or commissions such as gainsharing for exceeding goals or quotas Profit sharing The distribution of a percentage of the firm’s profit among its employees to motivate them to work effectively by giving them a stake in the successof the company

Types of Benefits Rewards in addition to regular compensation that are provided indirectly to the employee Type of benefits Pay for time not worked Vacation time, holidays, and sick leave Insurance packages Health, life, and dental coverage Pension and Retirement programs Costs may be shared or fully paid by the employer Required by law Workers’ compensation, unemployment insurance, and Social Security Flexible benefits plan An employee receives a predetermined amount of benefit dollars to spend on a package of benefits he or she has selected to meet individual needs

Types of Career Change: Organizational career management 1. Job change within the organization transfer promotion demotion 2. Separation from the organization layoff termination resignation retirement

job changes Promotions Transfers Layoffs Retirements Upward move with more authority, responsibility and pay Transfers Horizontal move in the organization Layoffs Temporary separation arranged by the employer, usually when business is slow Retirements Permanent separation that ends one’s career

trends affecting HR management Women comprise 45% of the American workforce Growing numbers of dual-career couples Companies are facing issues like sexual harassment and nonwork issues such as child and elder care Workers change jobs 3 to 5 times during their career Lessens loyalty between employer and employee Workforce is becoming more diverse Companies are offering diversity training and mentoring of minorities

Trends in Human Resources 1. Social change More women in the work force More people changing jobs 2. Demographics More diverse work force 3. Advancing Technology enables more outsourcing enables more telecommuting 4. Global Competition adaptable employees, need for language training & cultural orientation

Cultural Diversity in Human Resources Differences among people in a workforce due to race, ethnicity, and gender Advantages of diversity Cost savings from properly managing and integrating diversity into the company Attracting the best personnel Marketing advantages due to a better understanding of different cultural groups Improved creativity Increased organizational flexibility in the placement of personnel Fresh viewpoints for problem solving and decision making Bilingual skills bring numerous benefits to the organization

Cultural Diversity in Human Resources (cont’d) Coping with diversity challenges Train and educate managers to respect and manage diversity Recruit minority employees and train them to be managers Train managers to view diversity positively Teach English as a second language Provide mentoring programs and facilitate support groups Establish employee diversity groups Have a strong commitment from upper management to diversity goals for the organization