1. Human Resource Management Chapter 12

2. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 2 The Strategic Role of Human Resource Management Human Resource management has shed its old personnel image and gained recognition as a vital player in corporate strategy HRM departments not only support the organization’s strategic objective but actively pursue an ongoing, integrated plan for furthering the organization’s performance ● Higher employee productivity ● Stronger financial results ● Achieve organization’s strategic goals ● Key players on management team Manager’s Challenge: UPS Buffalo, New York

3. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 3 Human Resource Management All managers are resource managers Employees are viewed as assets Matching process, integrating the organization’s goals with employees’ needs How a company manages its workforce may be single more important factor in sustained competitive success

4. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 4 Current Strategic Issues Becoming more competitive globally Improving quality, productivity, & customer service Managing mergers & acquisitions Applying new information technology for e-business Determine a company’s need for skills and employees Experiential Exercise: Do You Want to be an HR Manager?

5. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 5 Human Resource Management Goals Develop an Effective Workforce Training Development Appraisal Maintain an Effective Workforce Wage and salary Benefits Labor relations Terminations HRM planning Job analysis Forecasting Recruiting Selecting Attract an Effective Workforce Company Strategy HRM Environment Legislation Trends in society International events Changing technology

6. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 6 Environmental Influences on HRM Competitive Strategy – Building Human Capital – Information Technology Federal Legislation

7. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 7 Three Ways HR Is Changing Development of global HR strategies IHRM Focus on building human capital The using of information technology 1 2 3

8. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 8 Human Capital - IHRM Human Capital = economic value of the knowledge, experience, skills, and capabilities of employees IHRM = addresses the complexity that results from recruiting, selecting, developing, and maintaining a diverse workforce on a global scale

9. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 9 Information Technology Human resource information technology = an integrated computer system designed to provide data and information used in HR planning and decision making Traditional HR to e-HR significantly affected every area of human resource management Some organizations are close to a paperless HRM system – saves time, money, frees staff

10. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 10 Federal Legislation Discrimination = hiring or promoting of applicants based on criteria that are not job relevant Affirmative action = policy requiring employers to take positive steps to guarantee equal employment opportunities for people within protected groups

11. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 11 Major Federal Laws - HRM Equal Opportunity/Discrimination Laws Compensation/Benefits Laws Health/Safety Laws Exhibit 12.3

12. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 12 The Changing Social Contract New ContractOld Contract Employee Employer Employability, personal responsibility Partner in business improvement Learning Job security A cog in the machine Knowing Continuous learning, lateral career movement, incentive compensation Creative development opportunities Challenging assignments Information and resources Traditional compensation package Standard training program Routine jobs Limited information SOURCE: Based on Louisa Wah, “The New Workplace Paradox “ Management Review, January 1998,7; and Douglas T. Hall and Jonathan B. Moss, “The New Protean Career Contract: Helping Organizations and Employees Adapt,” Organizational Dynamics, winter 1998, 22-37.

13. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 13 HR Issues in the New Workplace Teams and Projects Temporary Employees Technology Work-Life Balance Downsizing

14. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 14 HR Issues in the New Workplace Teams and Projects – major trend in today’s workplace With emphasis on projects, distinctions between job categories and descriptions are collapsing Many of today’s workers straddle functional & departmental boundaries; handle multiple tasks/responsibilities Virtual team = made up of members who – are geographically or organizationally dispersed, – rarely meet face to face, and – do their work using advance information technologies. Teams and Projects

15. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 15 HR Issues in the New Workplace In opening years of the 21 st century, largest employer in U.S. was a temporary employment agency, Manpower, Inc. Temporary Employees do everything from data entry to interim CEO Contingent workers = people who work for an organization, but not on a permanent or full-time basis, including temporary placements, contracted professionals, or leased employees Temporary Employees

16. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 16 HR Issues in the New Workplace Telecommuting and virtual teams are related trends Telecommuting = using computers and telecommunications equipment to perform work from home or another remote location Work anywhere - wireless Internet devices, laptops, cell phones, fax machines Extreme telecommuting = people live nd work in countries far away from the organization’s physical location Technology

17. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 17 HR Issues in the New Workplace Telecommuting is one way organizations help employees lead more balanced lives Flexible scheduling important in today’s workplace – 27% of workforce/flexible hours Broad Work-Life Balance initiatives – critical retention strategy – on-site gym & childcare, paid leaves & sabbaticals Work-Life Balance Many European companies ahead of U.S. companies

18. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 18 HR Issues in the New Workplace Downsizing = intentional, planned reduction in the size of a company’s workforce Managers can smooth the downsizing process – Regularly communicating with employees – Providing them with as much information as possible – Providing assistance to workers who will lose their jobs – Using training and development for remaining employees Downsizing

19. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 19 HR Issues in the New Workplace HR issues present many challenges for organizations and HR managers as they work toward the three primary HR goals ● Attracting ● Developing ● Maintaining an effective workforce

20. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 20 Matching Model An employee selection approach in which the organization and the applicant attempt to match each other’s needs, interests, and values Attracting an Effective Workforce

21. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 21 Attracting an Effective Workforce Choose Recruiting Sources Want ads Headhunters Internet Choose Recruiting Sources Want ads Headhunters Internet HR Planning Retirements Growth Resignations Select the Candidate Application Interview Tests Welcome New Employee Employee Contributions Ability Education Creativity Commitment Expertise Company Inducements Pay and benefits Meaningful work Advancement Training Challenge Matching Model Match with Company Needs Strategic goals Current & future competencies Market changes Employee turnover Corporate culture Employee Needs Stage of career Personal values Promotion aspirations Outside interests Family concerns Match with

22. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 22 Human Resource Planning Forecasting of human resource needs and the projected matching of individuals with expected vacancies ● ? = New technologies emerging ● ? = Volume of business likely next 5-10 years ● ? = Turnover rate, how much is avoidable, if any

23. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 23 Recruiting Recruiting = activities or practices that define the desired characteristics of applicants for specific jobs ● Internal – promote-from-within policies used by many to fill high-level positions ● External = recruiting newcomers from outside has advantage of multiple sources ● E-cruiting = use of Internet - fastest-growing approach to recruiting

24. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 24 Basic Building Blocks of HR Management Job Analysis Job Description Job Specification

25. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 25 Selecting Selection = process of determining the skills, abilities, and other attributes a person needs to perform a particular job Validity = relationship between an applicant’s score on a selection device and his or her future job performance

26. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 26 Selecting Application form - device used for collecting information about an applicant’s education, previous job experience, and other background characteristics Research = biographical information inventories can validly predict future job success

27. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 27 Interviewing An Applicant Know what you want Prepare a road map Use open-ended questions Do not ask irrelevant questions Do not rush interview Do not rely on your memory

28. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 28 Reasons For Not Asking About Home Ownership ● Might adversely affect applicants chances at the job ● Minorities and women may be less likely to own a home ● Home ownership is probably unrelated to job performance

29. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 29 Interview as Predictor of Success Interview is not generally a valid predictor of job performance – has high face validity as a selection tool Panel interviews – candidate meets with several interviewers who take turns asking questions – increases interview validity Computer-based interviews - complement traditional interviewing information

30. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 30 Inappropriate or Illegal Questions Race-related questions Age Religion Gender National origin Marital/family status Employment Applications and Interviews

31. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 31 Testing and Assessment Employment Test = written or computer- based test designed to measure a particular attribute such as intelligence or aptitude Assessment Center = technique for selecting individuals with high managerial potential based on their performances on a series of simulated managerial tasks

32. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 32 Developing an Effective Workforce Training and development = planned effort to facilitate employees’ learning of job-related skills and behaviors $100 billion/year On-the-job training = an experienced employee “adopts” a new employee to teach him or her how to perform job duties Cross training Mentoring Following selection, next goal of HRM is to develop employees

33. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 33 Performance Appraisal Process of observing and evaluating an employee’s performance, recording the assessment, and providing feedback to the employee Steps ● Observing and assessing performance ● Recording the assessment ● Providing feedback to employee

34. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 34 Making Performance Appraisals A Positive Force 1. The accurate assessment of performance through the development and application of assessment systems such as a rating scale 2. Training managers to effectively use the performance appraisal interview to provide feedback that reinforces good performance and motivate employee development

35. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 35 Assessing Performance Accurately 360° Feedback Process Performance Evaluation Errors – Stereotyping – Halo effect – BARS – Behaviorally-anchored rating scale

36. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 36 Behaviorally Anchored Rating Scale 12345 Have no plan or schedule of work and no concept of realistic due dates Have a sound plan but neglect to keep trace of target dates or to report schedule slippages or other problems as they occur Usually satisfy time constraints, with time and cost overruns coming up infrequently Develop a comprehensive schedule, observe target dates, and update the status of operations relative to plans, making schedule modifications as quickly as necessary Make a list of due dates and revise them but are frequently surprised by unforeseen events Job: Production Line Supervisor - Work Dimension: Work Scheduling Sources: Based on J.P. Campbell, M.D. Dunnette, R.D. Arvey, and L.V. Hellervik, “The Development and Evaluation of behaviorally Based Rating Scales,”Journal of Applied Psychology 57 (1973), 25-22; and Francine Alexander, ‘performance Appraisals,” Small Business Reports (March 2989), 20-29.

37. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 37 Maintaining an Effective Workforce Compensation – Wage and Salary Systems – Compensation Equity – Pay for Performance Benefits Termination Ethical Dilemma: A Conflict of Responsibilities

38. Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved. 38 Termination  Employees who are poor performers can be dismissed  Employers can use exit interviews in a positive manner Value of termination for maintaining an effective workforce is two fold