1. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 1 Chapter 13 Managing Human Resources

2. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 2 Learning Objectives Explain the strategic importance of managing human resources effectively. Describe several important laws and government regulations that affect how organizations manage their human resources. Explain the objective of human resources planning and describe how organizations respond to the unpredictability of future business needs.

3. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 3 Learning Objectives (cont.) Describe the hiring process. Describe several types of training and development programs. Describe several principles for improving the accuracy of managers’ appraisals of employee performance. Describe the basic elements of a monetary compensation package.

4. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 4 Strategic Importance Human resources management (HRM) refers to the philosophies, policies, and practices that an organization uses to affect the behaviors of people who work for the organization.

5. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 5 Gaining a Competitive Advantage To gain sustainable competitive advantage through HRM three conditions must be met: –employees must be a source of added value, –employees must be “rare” or unique in some way, and –competitors must not be able to easily copy or imitate the company’s approach to HRM.

6. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 6 The Legal and Regulatory Environment Equal Employee Opportunity (EEO) states that job applicants and employees should be judged on characteristics that are related to the work that they are being hired to do and on their performance after being hired. –Title VII of the Civil Rights Act, as originally enacted in 1964, prohibited discrimination by employers, employment agencies, and unions on the basis of race, color, religion, sex, or national origin.

7. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 7 The Legal and Regulatory Environment (cont.) Compensation and Benefits –Fair Labor Standards Act is a federal law that specifies a national minimum wage rate and requires payment for overtime work by covered employees. –Equal Pay Act requires men and women to be paid equally when they are doing equal work. An extension of the Equal Pay Act is the concept of comparable worth which requires employers to assess the worth of all jobs and ensure that people doing jobs of comparable worth are paid similarly.

8. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 8 Human Recourses Planning Human resources planning involves forecasting the organization’s human resources needs and developing the steps to meet them. –Contingent Workers –Layoffs –Competency Inventories

9. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 9 Historical Trend in Growth Rate of the U.S. Workforce (adapted from Figure 13.1)

10. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 10 -60-40-2002040 60 Percent Percent reporting an increase or decrease after layoffs Effects of Layoffs as Reported by Human Resource Managers in Companies That Reduce Their Workforce (adapted from Figure 13.2) More gossip More charges of discrimination Less employee loyalty More workplace violence More resignations Lower morale More profits

11. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 11 Hiring The hiring process includes activities related to the recruitment of applicants to fill open positions in an organization and the selection of the best applicants for a position.

12. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 12 Vacancies Stimulate the Hiring Process (adapted from Figure 13.3) Recruitment Vacancy Created Selection Organizational Growth Internal Movement Promotion Demotion Transfer Exit from Organization (Turnover)

13. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 13 0 Percent reporting problems Percent 102030405060 Problems Encountered When Applying for Jobs on the Internet (adapted from Figure 13.4) Difficult to navigate site Difficult to use Wanted more personal contact Concerns about security of personal data Lack of relevant information about the company Not enough jobs listed to make it worth the effort Slow feedback and follow-up

14. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 14 Training and Development Training refers to activities that help employees overcome limitations and improve performance in their current jobs. –Orientation Training –Basic Skills Training –E-Learning –Team Training Development refers to practices that help employees gain the competencies they will in the future in order to advance in their careers –Career Development –Mentoring –Coaching

15. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 15 Performance Appraisal Performance Appraisal refers to a formal, structured system for evaluating an employee’s job performance. –Results influence who is promoted, demoted, transferred, dismissed and the size of raises that employees receive.

16. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 16 Performance Appraisal (cont.) Research indicates that it is difficult for managers to accurately assess the performance of their subordinates. Some actions that organizations can take to help managers be more accurate when conducting performance appraisals include providing: –Rating Scale Format –Memory Aids –Rater Training –Rewards –Multiple Raters

17. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 17 Compensation Nonmonetary compensation includes many forms of social and psychological rewards—recognition and respect from others and opportunities for self-development. Monetary compensation includes direct payments such as salary, wages, and bonuses, as well as benefits such as covering the cost of insurance plans.

18. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 18 Average Annual Monetary Benefits and Earnings (adapted from Figure 13.6)

19. Copyright © 2005 by South-Western, a division of Thomson Learning All rights reserved 19 Vacationing Around the World (adapted from Figure 13.7) Italy France Germany Brazil Britain Canada South Korea Japan U.S. Average annual vacation days Days 051015202530354045