BUSINESS ESSENTIALS, 6 TH EDITION EBERT Chapter 8: Managing Human Resources and labor Relations 1Develped 2013

Define human resource management, discuss its strategic significance, and explain how managers plan for human resources. Identify the issues involved in staffing a company, including internal and external recruiting and selection. Discuss different ways in which organizations go about developing the capabilities of employees and managers. L E A R N I N G O B J E C T I V E S © 2009 Pearson Education, Inc. 2Develped 2013

Discuss the importance of wages and salaries, incentives, and benefit programs in attracting and keeping skilled workers. Describe some of the key legal issues involved in hiring, compensating, and managing workers in today's workplace. Discuss workforce diversity, the management of knowledge worl<ers, and the use of contingent and temporary worl<ers as important changes In the contemporary workplace. L E A R N I N G O B J E C T I V E S (cont’d) © 2009 Pearson Education, Inc. 3Develped 2013

What’s in It for Me? Why does effectively managing human resources matter to you? – By understanding the material in this chapter, you’ll be better able to understand: 1.The importance of properly managing human resources in a unit or business you own or supervise 2.Why and how your employer provides the working arrangements that most directly affect you © 2009 Pearson Education, Inc. 4Develped 2013

Human resource management (HRM) Human resource management (HRM) is the set of organizational activities directed at attracting, developing, and maintaining an effective workforce. 5Develped 2013

The Foundations of Human Resource Management Human Resource Management (HRM) – Activities directed at attracting, developing, and maintaining an effective workforce © 2009 Pearson Education, Inc. 6Develped 2013

The Strategic Importance of HRM 1.Human resources are critical for effective organizational functioning. 2.HRM (or personnel) its importance stemming from increased legal complexities. 3.Has a substantial impact on a firm's bottom- line performance. 4. Many firms are developing strategic HR plans 5. Chief officer reports to CEO 7Develped 2013

Who is responsible for HRD? A.Depends on the size of the company. 8Develped 2013

Figure 10.1 The HR Planning Process © 2009 Pearson Education, Inc. 9Develped 2013

HR planning process 1.First the HR department will conduct a job analysis. 2.Second, they will forecast a demand for labor. 3.This forecast will address the internal and external supplies of labor. 4.Finally they will develop a plan to match demand with supply. 10Develped 2013

HR Planning Job DescriptionDescription Lists the duties and responsibilities of a job; its working conditions; and the tools, materials equipment, and information used to perform it Job DescriptionDescription Lists the duties and responsibilities of a job; its working conditions; and the tools, materials equipment, and information used to perform it Job Specification Lists the skills, abilities, and other credentials and qualifications needed to perform the job effectively Job Specification Lists the skills, abilities, and other credentials and qualifications needed to perform the job effectively Job Analysis A systematic analysis of jobs within an organization © 2009 Pearson Education, Inc. 11Develped 2013

discussion A.Why job description is necessary? 1.Avoid overlapped and duplications. 2.Achieve employees high morals. 3.Responsibility is clearly identified. 12Develped 2013

Forecasting Labor Supply A.Forecasting the internal labor supply means determining the number and type of employees who will be in the firm at some future date. B.management tools: 13Develped 2013

Forecasting Labor Supply management tools: 1.Replacement charts: List each key management position, who occupies it, how long that person will likely stay in the job, and who (by name) is qualified as a replacement. 2.Skills inventories: Computerized information systems containing information about each employee’s education, work experience, and career aspirations. 14Develped 2013

HR Planning (cont’d) Forecasting HR Demand and Supply – Forecasting external supply (number/type of people who will be available for hiring from the labor market at large) 1.State employment commissions e.g. job centers. 2.Government reports 3.College information regarding enrollment and graduates in various majors © 2009 Pearson Education, Inc. 15Develped 2013

HR Planning (cont’d) Matching HR Supply and Demand – Alleviating Shortfalls by taking the following steps: 1.Seeking new hires 2.Retraining and transferring present employees 3.Retaining retirees 4.Installing more productive systems © 2009 Pearson Education, Inc. 16Develped 2013

Managing a Projected Shortfall how? A.Hire new employees, if people are indeed available in the external market. B.Retrain and transfer current employees into understaffed areas, providing a morale boost to strong employees. C.Consider hiring temporary workers, especially if the shortfall appears short-term or uncertain. D.Convince older workers not to retire, which usually requires strong financial incentives. E.The creative solution: Develop and install productivity enhancing systems 17Develped 2013

HR Planning (cont’d) Matching HR Supply and Demand – Managing Overstaffing 1.Transferring extra employees 2.Not replacing employees who quit (attrition) 3.Encouraging early retirement 4.Laying off personnel © 2009 Pearson Education, Inc. 18Develped 2013

Staffing the Organization Recruiting – Attracting qualified persons to apply for the jobs that are open – Internal Recruiting Considering present employees as candidates for openings 1.Promotion from within 2.Union contracts and job bidding inside the organization. © 2009 Pearson Education, Inc. 19Develped 2013

Staffing the Organization – External Recruiting Attracting people outside of the organization to apply for jobs 1.State employment agencies 2.Private employment agencies 3.Advertisements © 2009 Pearson Education, Inc. 20Develped 2013

Discussion Faculty of Commerce is looking to recruit a manager to the faculty. Think in internal and external recruiting. 21Develped 2013

Selecting Human Resources A.Once the recruiting process has attracted a pool of applicants, the next step is to select someone to hire. B.The intent of the selection process is to gather information from applicants that will predict their job success and then to hire the candidates likely to be most successful Develped

Selecting Human Resources Tools/techniques used in selection process. Application forms; The first step in selection is asking the candidate to fill out an application form. However, make sure the forms do not ask illegal questions such as one’s age, marital status, etc. An efficient method of gathering information about the applicant's previous work history, educational background, and other job- related demographic data. 23Develped 2013

Selecting Human Resources Tools/techniques used in selection process. -Tests —ability, skills, aptitude /fitness, knowledge, attitude. A.All candidates should be given the same directions, allowed the same amount of time, and offered the same testing environment, including temperature, lighting, and distractions. 24Develped 2013

Tools/techniques used in selection process. A.The Interview Is a popular selection device, but it is sometimes a poor predictor of job success because biases inherent in the way people perceive and judge others on first meeting affect subsequent evaluations. Develped

Selecting Human Resources Tools used. - Interviews — interview people through a committee. validity is increased by: A.Training interviewers to reduce individual bias B.Using a structured interview format with job-related questions to improve consistency, reduce bias, and eliminate illegal questioning of applicants 26Develped 2013

Selecting Human Resources Other techniques that can be used: Polygraph, or lie detector test. These are not used that frequently anymore. Physical exams, but employers must be aware with Disabilities Act, which forbids denying someone employment based on physical disability alone. Drug tests. Reference checks. 27Develped 2013

Developing the Workforce Training 1.On-the-job training: Working side-by-side as the employee learns the tasks required of the position. Also the use job rotation. Off-the-job training: training them away from their jobs. E.g., Vestibule/entrance training: involves employees performing work under conditions closely simulating the actual work environment. © 2009 Pearson Education, Inc. 28Develped 2013

Performance Appraisal A.Evaluating Employee Performance. B.Performance appraisals are designed to show how well workers are doing their jobs. The are called appraisal process uses a written assessment issued on a regular basis. C.It is best to rely on several information sources when conducting appraisals. A system called 360-degree feedback gathers information from supervisors, subordinates, and co-workers. Develped

Developing the Workforce (cont’d) Performance Appraisal – Defining performance standards – Observing performance – Writing up the assessment – Discussing the appraisal – Methods for Appraising Performance غير مطلوبة Performance Appraisal Evaluating job performance Performance Appraisal Evaluating job performance © 2009 Pearson Education, Inc. 30Develped 2013

FIGURE 10.2 Sample Performance Evaluation Form © 2009 Pearson Education, Inc. 31Develped 2013

Compensation and Benefits Compensation System – The total package of rewards that a company offers employees in return for their labor Wages —money paid for time worked, generally refer to hourly compensation paid to operating employees. Salary —money paid to perform a job, regardless of the amount of times or output involved. © 2009 Pearson Education, Inc. 32Develped 2013

Compensation and Benefits – Factors affecting compensation 1.Competitors’ wage offerings 2.Internal wage and salary structure—includes: job value, performance, and longevity. 3.Internal pay equity. © 2009 Pearson Education, Inc. 33Develped 2013

Example of Salary Structure in PA 1.Basic Salary 2.Wife & children 3.Supervision 4.specialization 5.qualification 6.Annual increase. 34Develped 2013

Compensation and Benefits (cont’d) Incentive programs: are Special pay programs designed to motivate high performance – Individual incentives: Bonuses: payment above their salaries when they sell a certain number or certain dollar amount of goods for the year. Pay for performance (variable pay): Such incentives go to middle managers on the basis of company-wide performance. © 2009 Pearson Education, Inc. 35Develped 2013

Compensation and Benefits (cont’d) Incentive programs – Company-wide incentives: to all employees (group incentives) 1.Profit-sharing plans : profits earned above a certain level are distributed to employees. 2.Gain sharing plans, which reward groups for their performance in reducing cost. 3.Pay-for-knowledge plans, which encourage employees to gain new knowledge or skills. E.g, extra payment for certain training hours. © 2009 Pearson Education, Inc. 36Develped 2013

Compensation and Benefits (cont’d) Benefits Programs: can be mandatory or discretionary. – Mandatory (required by law) 1.Social Security retirement benefits 2.Workers’ compensation insurance © 2009 Pearson Education, Inc. 37Develped 2013

Compensation and Benefits (cont’d) – Discretionary (optional) 1.Health, life, and disability insurance 2.Paid Vacations and holidays (Paid Time Off). 3.Employee assistance programs 4.Retirement (pension) plans © 2009 Pearson Education, Inc. 38Develped 2013

Compensation and Benefits (cont’d) –Cafeteria benefits plans. These plans set aside a certain amount of money for benefits for each employee, and those employees choose how they wish to spend those funds © 2009 Pearson Education, Inc. 39Develped 2013

The Legal Context of HRM Equal Employment Opportunity Laws – Protect workers from unfair or inappropriate (non-job-related) discrimination in the workplace, e.g, manager bias to employee’s friend. © 2009 Pearson Education, Inc. 40Develped 2013

The Legal Context of HRM Protected Classes in the Workplace Individuals sharing common characteristics as defined by law. Race, color, religion, gender, age, national origin, disability status, and status as a military veteran. © 2009 Pearson Education, Inc. 41Develped 2013

New Challenges in the Changing Workplace Managing Workforce Diversity – Workforce diversity: includes, The range of workers’ attitudes, values, beliefs, and behaviors that differ by gender, race, age, ethnicity, physical ability, and other relevant characteristics – Organizations are recognizing that diversity can be a competitive advantage © 2009 Pearson Education, Inc. 42Develped 2013

Diversity in Canada A.By 2017, visible minorities will form more than 50 percent of the populations of Toronto and Vancouver. B. By 2017, 22 percent of the total Canadian population will be visible minorities. C.In the past, organizations tended to work toward homogenizing their workforces, getting everyone to think and behave in similar ways. Develped

FIGURE 10.3a Distribution of the Labor Force by Race 1990 – 2050 in USA FIGURE 10.3b Hispanic Share of Civilian Labor © 2009 Pearson Education, Inc. 44Develped 2013

Managing Knowledge Workers A.KNOWLEDGE WORKERS are experts in specific fields like compute technology and engineering, who add value because of what they know, rather how long they have worked. Develped

New Challenges in the Changing Workplace (cont’d) Managing Knowledge Workers – Knowledge workers add value because of what they know, they include: Computer scientists Physical scientists Engineers Hiring and retaining knowledge workers is a critical HR challenge © 2009 Pearson Education, Inc. 46Develped 2013

Discussion please give two examples of knowledge workers who might be employed by a large ice-cream manufacturer. Accountant- sales men- industrial engineer- factory manager. 47Develped 2013

New Challenges in the Changing Workplace (cont’d) Contingent Workers – A person who works for an organization on something other than a permanent or full- time basis. These can include: 1.Independent contractors 2.On-call workers 3.Temporary employees, e.g, employing through agencies. 4.Contract and leased employees 5.Part-time workers © 2009 Pearson Education, Inc. 48Develped 2013

Trends in Contingent Employment A.Contingent employment is on the rise in Canada. Part-time employment in all categories was nearly 7 percent higher in 2009 than In Develped

Managing Contingent and Temporary Workers Managing Contingent and Temporary Workers. Some of these challenges include: 1.Careful planning for coordinated use of temporary workers 2.Understanding the advantages and disadvantages of contingent workers 3.Assessing the true cost of using contingent workers 4.Developing a strategy for integrating contingent workers into the organization © 2009 Pearson Education, Inc. 50Develped 2013

Contract Contract Issues, include: – Compensation Cost-of-living adjustment (COLA) clauses Wage reopener clauses/sections – Benefits – Job security – Management rights © 2009 Pearson Education, Inc. 51Develped 2013

Collective Bargaining (cont’d) Union Tactics When Bargaining sometimes Fails. What they use? 1.Strike 2.Picketing/ protest, e.g., go on the media 3.Boycott: Union members will not buy products from a specific firm. 4.Work slowdown e.g., call in sick © 2009 Pearson Education, Inc. 52Develped 2013

Collective Bargaining (cont’d) Management Tactics When Bargaining Fails 1.Lockouts: Workers are locked out of company facilities. 2.Hiring strikebreakers who cross the picket/ strike lines. © 2009 Pearson Education, Inc. 53Develped 2013

Mediation Voluntary Arbitration Compulsory Arbitration Collective Bargaining (cont’d) Resolving Disputes © 2009 Pearson Education, Inc. 54Develped 2013

Resolving Disputes Resolving union disputes includes: 1.Mediation, where the parties sit down at the bargaining table to try to work things out with a mediator or a third party. 2.Arbitration, either voluntary or compulsory, which calls for a third party to judge the situation and make a decision on the appropriate solution. 3.Some arbitration is binding, which means that both sides agree to abide by the arbitrator’s decision as law. 55Develped 2013