HRM objectives

HRM v Personnel HRM sees the activities with the workforce as key to corporate objectives. The aim of HRM is to make the best use of the workforce for the company to achieve its goals. Personnel management considers all the elements of managing people as separate elements / unrelated tasks & ignores the wider picture.

What activities do HRM do? Recruitment Pay Training Appraisal Motivation

Why HRM has become more important? Most businesses now provide services rather than produce goods – people are the critical resource in the quality and customer service level Competitiveness requires a business to be efficient and productive – this is difficult unless the workforce is well motivated, has the right skills and is effectively organised The move towards fewer layers of management hierarchy (flatter organisational structures) has placed greater emphasis on delegation and communication

HUMAN RESOURCE OBJECTIVES Corporate Objectives Functional Objectives HR Objectives The targets that the HR function of a business wants to achieve in a given time period

HRM objectives include…

HRM objectives 1.Matching the workforce to the needs of the business 2.Making full use of the workforce’s potential 3.Minimising labour costs 4.Maintaining good employee/employer relations

1.Matching the workforce to the needs of the business Workforce planning to ensure business has the right number of staff in the right locations with the right skills Effective recruitment to match workforce needs Training programmes to cover skills gaps or respond to changes in technology, processes & market Consider outsourcing activities Get the right number and mix of staff at each location where the business operates in multiple sites and countries

What would happen if you had the wrong number / type of staff?

2.Making full use of the workforce’s potential Regular appraisals and skills audits Internal promotion Development opportunities Ensure jobs have suitable, achievable workloads Avoid too many under-utilised or over-stretched staff Make best use of employees skills

Productivity - how can it help the corporate objectives? Customer service Ratios? Marketing Prices Finances

3.Minimising labour costs Reduced labour turnover to keep recruitment costs low Should not be achieved to the detriment of overall performance of staff and ultimately the business Pay rates should be competitive but not excessive Achieve acceptable staff utilisation Minimise staff turnover Measure returns on investment in training

Harrods staff Ryanair staff (holding their ‘modelling’ photo from calendar!) Tightly controlled costs; work long hours and have multiple skills. Lower staffing levels More generous staffing levels, well paid staff Staff are currently leaving RBS due to govt pressure to NOT pay annual bonuses (govt owns 80% stake in RBS through bank bail out). Staff leaving for competitor companies.

4.Maintaining good employee / employer relations –Effective communication –Good industrial relations –Avoiding disputes –Avoiding negative publicity –Complying with all relevant labour laws

Recent strike action In Paris, around 20 museums, art galleries and public monuments had suffered either total or partial closure as public sector workers downed tools over what they described as an attempt to "dismantle and destabilise" France's flagship cultural sector. museums

BT shed 10,000 jobs. In Nov 2008 BT announced that it intending to cut 10,000 jobs from its global workforce of 160,000. The news of the cuts sent BT shares 7.5% higher. Many of the job losses were in the UK. 1.Which HR objective might have prompted this decision? 2.Which corporate objective might this decision help BT to fulfil?

Are you Hard or Soft?

HR strategies Sees people as an unwelcome cost People are an input to get work done Managers are the ‘thinkers’ – give instructions to workers! Sees people as an unwelcome cost People are an input to get work done Managers are the ‘thinkers’ – give instructions to workers! Hard Sees people as those who can add value to the business. A business needs to develop their employees skills, interests & abilities Managers are facilitators – to coach & help staff to do their work properly. Sees people as those who can add value to the business. A business needs to develop their employees skills, interests & abilities Managers are facilitators – to coach & help staff to do their work properly. Soft

HR strategies Treats employees simply as a resource of the business. Strong link with corporate business planning – what resources do we need, how do we get them and how much will they cost Treats employees simply as a resource of the business. Strong link with corporate business planning – what resources do we need, how do we get them and how much will they cost Hard Treats employees as the most important resource in the business and a source of competitive advantage Employees are treated as individuals and their needs are planned accordingly Treats employees as the most important resource in the business and a source of competitive advantage Employees are treated as individuals and their needs are planned accordingly Soft

Evaluation skills What are the benefits of having a ‘hard’ HRM strategy? Staff are well monitored Costs are minimised, Companies can increase / reduce output when needed. Greater centralisation / control by managers

Evaluation skills What are the benefits of having a ‘soft’ HRM strategy? High levels of employee participation, Higher motivation Greater commitment from staff, Lower turnover, Less absenteeism Greater productivity!

Your go Read ‘Halfords’ Case study Complete Q’s To discuss Preliminary Q’s Use whiteboard to plan answer to Hard or Soft Q.

Homework Read chapter 15 p Make own notes on Internal & external factors on HRM objectives. Make more revision notes on Hard & Soft HRM strategies.