Human Resource Management Review

Human Resource Management Review

Responsibilities of HR Departments
Employment and Recruiting Training and Development Compensation Benefits Employee Services Employee and Community Relations Personnel Records Health and Safety Strategic Planning Table 1.1 shows the responsibilities of HR departments. The HR department is solely responsible for outplacement, labor law compliance, record keeping, testing, unemployment compensation, and some aspects of benefits administration. The HR department is most likely to collaborate with other company functions on employment interviewing, performance management and discipline, and efforts to improve quality and productivity. Large companies are more likely than small ones to employ HR specialists, with benefits specialists being the most prevalent. Other common specializations include recruitment, compensation, and training and development. Many different roles and responsibilities can be performed by the HR department depending on the size of the company, the characteristics of the workforce, the industry, and the value system of company management. 1-2

Talent Management Talent management is the systematic planned strategic effort by a company to use bundles of HRM practices including acquiring and assessing employees, learning and development, performance management , and compensation to attract, retain, develop, and motivate highly skilled employees and managers. Growth of contingent workers and part-time employees Alternative work arrangements Talent management is the systematic planned strategic effort by a company to use bundles of HRM practices including acquiring and assessing employees, learning and development, performance management, and compensation to attract, retain, develop, and motivate highly skilled employees and managers. This means recognizing that all HR practices are related and aligned with business needs, and help the organization manage talent to meet business goals. Contingent workers and part-time employees can be less expensive than full-time employees and help avoid layoffs. 1-3

The Balanced Scorecard
The balanced scorecard provides a view of the company from the perspective of internal and external customers, employees and shareholders. The balanced scorecard should be used to: Link HRM activities to the company’s business strategy. Evaluate the extent to which HR is helping meet the company’s strategic objectives. The balanced scorecard gives managers the opportunity to look at the company from the perspective of internal and external customers, employees and shareholders. The balanced scorecard should be used to: -- Link human resource management activities to the company business strategy. -- Evaluate the extent to which the human resource function is helping the company’s meet its strategic objectives. Measures of human resource practices primarily relate to productivity, people, and processes. 1-4

Legal and Ethical Issues
5 legal areas that influenced HRM : Equal employment opportunity legislation Employee safety and health Employee pay and benefits Employee privacy Job security Women and minorities still face the “glass ceiling” Sarbanes-Oxley Act of 2002 Federal health care legislation Companies which employ unlawful immigrants or abuse laborers Data-security practices and protecting intellectual property There are five main areas of the legal environment that influence HRM: Equal employment opportunity legislation Employee safety and health Employee pay and benefits Employee privacy Job security The Sarbanes-Oxley Act of 2002 sets strict rules for corporate behavior and sets heavy fines for noncompliance, especially in regard to accounting practices. Federal health care legislation means that companies need to ensure that HR professionals are working with legal counsel and benefits experts to understand the details and implications of the new law, conducting cost analysis to determine the financial impact of the new law on the business and helping determine if health care will be provided and what form it will take. Scrutiny of companies that employ unlawful immigrants or abuse laborers will increase. Data-security practices and protecting intellectual property will increase as concerns due to publication of classified documents by WikiLeaks and Wall Street among others. Women and minorities still face the “glass ceiling.” 1-6

Strategic Management Process Model
Strategy Formulation Strategy Implementation HR Practices Recruiting Training Performance management Labor relations Employee relations Job analysis Job design Selection Development Pay structure Incentives Benefits External Analysis Opportunities Threats Firm Performance Productivity Quality Profitability Mission Goals Strategic Choice HR Needs Skills Behavior Culture HR Capability Skills, Abilities Knowledge HR Actions Behaviors Results Figure 2.2 presents the Strategic Management Process Model. The success of the strategic management process depends largely on the extent to which the HRM function is involved. The mission, goals and strategic choice, along with an external and internal analysis, encompass the strategy formulation that precedes strategy implementation. HR needs shapes the HR practices based on HR capabilities and actions that ultimately determine the firm’s performance. Internal Analysis Strengths Weaknesses 2-7

Job Analysis Information
Job Description- list of tasks, duties, and responsibilities (TDRs) tasks, duties and responsibilities Job Specification - list of skills, knowledge, abilities, and other characteristics (KSAOs) knowledge, skills, abilities and other characteristics Two types of information are most useful in job analysis: job descriptions and job specifications. A job description is a list of the tasks, duties, and responsibilities (TDRs) that a job entails. TDRs are observable actions. For example, a clerical job requires the jobholder to type. If you were to observe someone in that position for a day, you would certainly see some typing. When a manager attempts to evaluate job performance, it is most important to have detailed information about the work performed in the job (that is, the TDRs). This makes it possible to determine how well an individual is meeting each job requirement. It is important to balance breadth and specificity when constructing job descriptions. A job specification is a list of the knowledge, skills, abilities, and other characteristics (KSAOs) that an individual must have to perform the job. Knowledge refers to factual or procedural information that is necessary for successfully performing a task. A skill is an individual’s level of proficiency at performing a particular task. Ability refers to a more general enduring capability that an individual possesses. Finally, other characteristics might be personality traits such as one’s achievement motivation or persistence. 4-11

Sample Job Description
Job Title: Maintenance Mechanic General Job Description: General maintenance and repair of all equipment used in operations of a particular district. Includes servicing company used vehicles, shop equipment and machinery used on job sites. 1. Essential duty (40%) Maintenance of Equipment 2. Essential duty (40%) Repair of Equipment 3. Essential duty (10%) Testing and Approval 4. Essential duty (10%) Maintain Stock Nonessential functions: Other duties assigned This slide, Table 4.1, shows a sample job description. To evaluate job performance, it is most important to have detailed information about the work performed in the job (that is, the TDRs) to determine how well an individual is meeting each job requirement. 4-12

Job Analysis Methods (PAQ) (FJAS) (ONET)
Position Analysis Questionnaire (FJAS) Fleishman Job Analysis System (ONET) Occupational Information Network Job Analysis- process of getting detailed information about jobs. There are three job analysis methods described here: The Position Analysis Questionnaire (PAQ) is a standardized job‑analysis questionnaire containing 194 items representing work behaviors, work conditions, or job characteristics that are generalizable across a wide variety of jobs. Fleishman Job Analysis System (FJAS) -- This approach defines abilities as enduring attributes of individuals that account for differences in performance. The system is based on taxonomy of 52 cognitive, psychomotor, physical, and sensory abilities that adequately represent all the dimensions relevant to work. The Occupational Information Network (O*NET) -- Instead of relying on fixed job titles and narrow task descriptions, the O*NET uses a common language that generalizes across jobs to describe the abilities, work styles, work activities, and work context required for various occupations that are more broadly defined. Job Analysis- process of getting detailed information about jobs. 4-13

PAQ’s 6 Sections Information Input – how and where information comes from Relationships – how the individual interacts with other persons to perform the job Mental Processes – reasoning, decision making, planning & information processing Job Context – physical and social Work Output – physical activities, tools & devices used Other Characteristics 4-14

PAQ Rating Once an item is found to apply to a position, that item is rated against other items using six scales: Extent of use, Amount of time, Importance to the job, Possibility of occurrence, Applicability, and Special code (applicable to that item) McGraw-Hill/Irwin ©2012 The McGraw-Hill Companies, All Rights Reserved

Job Design and Job Redesign
Job design is the process of defining how work will be performed and the tasks that will be required in a given job. Job redesign refers to changing the tasks or the way work is performed in an existing job. Job design is the process of defining how work will be performed and the tasks that will be required in a given job. Job redesign refers to changing the tasks or the way work is performed in an existing job. To effectively design jobs, one must thoroughly understand the job as it exists (through job analysis) and its place in the larger work unit’s work-flow process (work-flow analysis). Having a detailed knowledge of the tasks performed in the work unit and in the job, a manager then has many alternative ways to design a job. This can be done most effectively through understanding the trade-offs between certain design approaches. 4-16

Job Design Using the Motivational Approach
Jobs designed using this approach tend to focus on the meaningfulness of the job: Job Enlargement – broadens the types of tasks performed in the job Job Enrichment – adds more decision making authority to the job Self Managing Teams – work performed without specific guidance from management McGraw-Hill/Irwin ©2012 The McGraw-Hill Companies, All Rights Reserved

Trade-Offs Among Job Design Approaches
Positive Outcomes Higher job satisfaction Higher motivation Greater job involvement Lower absenteeism Decreased training time Higher utilization levels Lower likelihood of error Less chance of mental overload and stress Less physical effort Less physical fatigue Fewer health complaints Fewer medical incidences Lower likelihood of accidents Lower training time Approach Motivational Mechanistic Biological Perceptual- Motor Negative Outcomes Increased training time Lower utilization levels Greater likelihood of error Greater chance of mental overload and stress Lower job satisfaction Lower motivation Higher absenteeism Higher financial costs because of changes in equipment or job environment Not all efficiency-producing changes result in dissatisfying work, and not all changes that promote satisfaction create inevitable inefficiencies. By carefully and simultaneously attending to both efficiency and satisfaction aspects of job redesign, managers can sometimes achieve the best of both worlds. 4-18

Forecasting Demand for Employees
Forecasting Techniques Expert estimates (top down) Trend projections (top down)) Success depends on accurate and freely shared information Statistical modeling (top down)) Unit-demand forecasting (bottom up)) 5-19

Exhibit 5-3 Movement of Nurses
Exhibit 5-4 Probabilities of Retention of Nurses in Three Local Hospitals 5-20

Validity Validity is the extent to which a performance measure assesses all the relevant—and only the relevant—aspects of job performance. Criterion-related validation is a method of establishing the validity of a personnel selection method by showing a substantial correlation between test scores and job-performance scores. The types include: Predictive validation Concurrent validation Small sample sizes make a determination of statistical validity in testing impossible Validity is the extent to which a performance measure assesses all the relevant –and only the relevant- aspects of job performance. Criterion‑related validation is a method of establishing the validity of personal selection methods by showing a substantial correlation between test scores and job-performance scores. There are two types of criterion‑related validity: Predictive validation is a criterion-related validity study that seeks to establish an empirical relationship between applicants’ test scores and their eventual performance on the job. Concurrent validation is a criterion-related validity study in which a test is administered to all the people currently in a job. 6-21

Content Validation Content validation is a test-validation strategy performed by demonstrating that the items, questions, or problems posed by a test are a representative sample of the kinds of situations or problems that occur on the job. Best for small samples Achieved primarily through expert judgment Content validation is a test-validation strategy performed by demonstrating that the items, questions, or problems posed by a test are a representative sample of the kinds of situations or problems that occur on the job. A test that is content valid exposes the job applicant to situations that are likely to occur on the job, and then tests whether the applicant currently has sufficient knowledge, skill, or ability to handle such situations. There are two limitations to content validation: (a) the person who is hired must have the knowledge, skills, or abilities at the time he or she is hired and (b) subjective judgment plays such a large role in content validation. 6-22

Generalizability Generalizability is the degree to which the validity of a selection method established in one context extends to other contexts. 3 Contexts include: different situations (jobs or organizations) different samples of people different time periods Generalizability is the degree to which the validity of a selection method established in one context extends to other contexts. It was once believed that validity coefficients were situation specific—that is, the level of correlation between test and performance would vary as one went from one organization to another. It was also believed that tests showed differential subgroup validity, which meant that the validity coefficients for any test-job performance pair was different for people of different races or genders. Validity generalization stands as an alternative for validating selection methods for companies that cannot employ criterion-related or content validation. 6-23

Utility Utility is the degree to which information provided by selection methods enhances the effectiveness of selecting personnel. Utility is impacted by reliability, validity and generalizability. Utility is the degree to which the information provided by selection methods enhances the effectiveness of selecting personnel in organizations. Utility is impacted by reliability, validity, and generalizability. Other factors will influence utility even when the latter is constant. For example, the selection ratio, which is the percentage of people tested versus the total number of applicants, will impact utility as well as the number of people selected, rate of employee turnover, and level of performance among those who leave. 6-24

Legality All selection methods must conform to existing laws and legal precedents. Three acts have formed the basis for a majority of the suits filed by job applicants: Civil Rights Act of 1964 and 1991 Age Discrimination in Employment Act of 1967 Americans with Disabilities Act of 1991 Legality—All selection methods must conform to existing laws and legal precedents. Three primary federal laws form the basis for a majority of the suits filed by job applicants. First, the Civil Rights Act of 1991, an extension of the Civil Rights Act of 1964, protects individuals from discrimination based on race, color, sex, religion, and national origin with respect to hiring as well as compensation and working conditions. 6-25

Interviews Selection interviews-a dialogue initiated by one or more persons to gather information and evaluate the applicant’s qualifications for employment. To increase an interview’s utility: Interviews should be structured, standardized, and focused on goals oriented to skills and observable behaviors. Interviewers should be able to quantitatively rate each interview. Interviewers should have a structured note-taking system that will aid recall to satisfying ratings. Interviews are the most widely used selection method, although research suggests they can be unreliable, low in validity, and biased against a number of groups. Selection interviews are defined as a dialogue initiated by one or more persons to gather information and evaluate the qualifications of an applicant for employment. The utility of an interview can be increased by the following suggestions: Interviews should be structured, standardized, and focused on goals oriented to skills and observable behaviors. Interviewers should plan to come out of each interview with a quantitative rating on a small number of dimensions that are observable (like interpersonal style or ability to express oneself) and avoid ratings of abilities that may be better measured by tests (like intelligence). Interviewers should also have a structured note-taking system that will aid recall when it comes to satisfying the ratings. 6-26

Situational Interview
A situational interview confronts applicants on specific issues, questions, or problems likely to arise on the job. Situational interviews consist of: experience-based questions future-oriented questions A situational interview is an interview procedure where applicants are confronted with specific issues, questions, or problems that are likely to arise on the job. They consist of experience-based questions and future-oriented questions. Some items are “experience-based” and require the applicant to reveal an actual experience he or she had in the past when confronting the situation. Other items are “future-oriented” and ask what the person is likely to do when confronting a certain hypothetical situation in the future. 6-27

Other Selection Methods
Individuals should manage their digital identity the same way they manage their résumé. References, biographical data, and applications gather background information on candidates. Physical ability tests are relevant for predicting job performance, occupational injuries and disabilities. Physical ability tests include: muscular tension, power, and endurance cardiovascular endurance flexibility balance coordination Individuals should manage their digital identity the same way they manage their résumé. Other selection methods such as references, biographical data, and applications that gather background information on candidate are, at best, weak predictors of future job success. Typically, references are very positive since only those who the applicants know will give them a good reference are asked to do so. Many suits have been filed against past employers’ revealing too much information beyond job title and years of service. The biggest concern with the use of biographical data is that applicants who supply the information may be motivated to misrepresent themselves. Physical ability tests are relevant for predicting job performance, occupational injuries and disabilities (if the physical ability is essential to performing the job and if it is mentioned prominently enough in the job description). Criterion‑related validities tend to be quite strong, although adverse impact on the disabled and women is highly possible. For example, roughly two-thirds of all males score higher than the highest-scoring female on muscular tension tests. 6-28

Other Selection Methods
A cognitive ability test differentiates individuals based on mental rather than physical capacities. Commonly assessed abilities: verbal comprehension quantitative ability reasoning ability Personality inventories categorize individuals by personality characteristics. Work samples simulate a job in miniaturized form. Any testing method used should be validated to avoid potential adverse impact on protected groups One of the major drawbacks to these tests is that they typically have adverse impacts on some minority groups. Indeed, the size of the differences is so large that some have advocated abandoning these types of tests for making decisions regarding who will be accepted for certain schools or jobs. Verbal comprehension refers to a person’s capacity to understand and use written and spoken language. Quantitative ability concerns the speed and accuracy at which one can solve arithmetic problems. Reasoning ability refers to a person’s capacity to invent solutions to many diverse problems. Common dimensions assessed in a personality inventory are extroversion, adjustment, agreeableness, conscientiousness, and inquisitiveness. Work samples are job‑specific and tend to be high in criterion‑related and content validity and low in adverse impact. 6-29

Measuring Performance
Comparative approach compares performance with that of others. Ranking Simple ranking ranks employees from highest to lowest performer. Alternation ranking is crossing off the best and worst employees. Forced distribution is employees ranked in groups. Paired comparison Managers compare every employee with every other employee in work group. The comparative approach to performance requires the rater to compare an individual’s performance with that of others. 1. Ranking is one of the techniques that arrive at an overall assessment of the individual's performance. a. Simple ranking requires managers to rank employees within their departments from highest performer to poorest performer. b. Alternation ranking consists of a manager looking at a list of employees, deciding who is the best employee, and crossing that person’s name off the list. 2. Forced Distribution—The forced distribution method requires the managers to put certain percentages of employees into predetermined categories. 3. Paired Comparison—The paired comparison method requires managers to compare every employee with every other employee in the work group, giving an employee a score of one every time he or she is considered the higher performer. Employees are ranked by how many points they receive. 8-31

Attribute Approach Graphic rating scales
list of traits evaluated by 5-point rating scale. legally questionable. Mixed-standard scales define relevant performance dimensions develop statements representing good, average, and poor performance along each dimension. The attribute approach to performance management focuses on the extent to which individuals have certain attributes: 1. Graphic Rating Scales can provide a number of different points (a discrete scale) or a continuum along which the rater simply places a check mark (a continuous scale). 2. Mixed Standard Scales are developed by defining the relevant performance dimensions with statements representing good, average, and poor performance along each dimension. 8-32

Behavioral Approach Critical incidents approach requires managers to keep record of specific examples of effective and ineffective performance. Behaviorally anchored rating scales (BARS) Behavioral observation scales (BOS) Organizational behavior modification is a formal system of behavioral feedback and reinforcement. Assessment centers are multiple raters who evaluate employees’ performance on a number of exercises. The behavioral approach to performance management attempts to define the behaviors an employee must exhibit to be effective in the job. The various techniques define those behaviors and then require managers to assess the extent to which employees exhibit them. Critical Incidents—The critical incident approach requires managers to keep a record of specific examples of effective and ineffective performance for each employee. 2. Behaviorally anchored rating scales (BARS) specifically define performance dimensions by developing behavioral anchors associated with different levels of performance. Behavioral observation scales (BOS) is a variation of a BARS. They are developed from critical incidents but use a larger number of the behaviors that are necessary for effective performance. Rather than assessing which behavior best reflects an individual’s performance, a BOS requires managers to rate the frequency with which the employee has exhibited each behavior during the rating period. These ratings are then averaged to compute an overall performance rating . Organizational behavior modification (OBM) entails managing the behavior of employees through a formal system of behavioral feedback and reinforcement. Assessment centers can be used for measuring managerial performance. During an assessment, individuals usually perform a number of simulated tasks, and assessors observe and evaluate the individual's skill or potential as a manager. The behavioral approach might be best suited to less complex jobs (where the best way to achieve results is somewhat clear) and least suited to complex jobs (where there are multiple ways, or behaviors, to achieve success). 8-34

Sample BOS It is generally agreed that a BOS provides the best means for differentiating employee performance

Competency Model Competencies are sets of skills, knowledge, abilities and personal characteristics that enable employees to successfully perform their jobs. A competency model identifies competencies necessary for each model and provides descriptions common for an entire occupation, organization, job family or specific job. Also useful for recruiting, selection, training and development. Competencies are sets of skills, knowledge, abilities and personal characteristics that enable employees to successfully perform their jobs. A competency model identifies competencies necessary for each model and provides descriptions common for an entire occupation, organization, job family or specific job. Also useful for recruiting, selection, training and development. 8-37

Strengths and Weaknesses of the Behavioral Approach
Strengths include effectiveness, the ability to link business strategy with employee behaviors, can have high validity when linked to job analysis, are generally highly accepted, and can be very reliable when used properly Weaknesses include difficulty in insuring that behaviors are linked with the organization’s strategy, assumes that favored behaviors are the best way to perform the job, and can be less suited to complex jobs McGraw-Hill/Irwin ©2012 The McGraw-Hill Companies, All Rights Reserved

Withstand Legal Scrutiny
Conduct a valid job analysis related to performance. Base system on specific behaviors or results. Train raters to use system correctly. Review performance ratings and allow for employee appeal. Provide guidance/support for poor performers. Use multiple raters. Document performance evaluations. In discrimination suits, the plaintiff often claims that the performance ratings were subjective and that the rater was biased and influenced by gender or racial stereotypes. Because of the potential costs of discrimination and unjust dismissal suits, an organization needs to determine exactly what the courts consider a legally defensible performance management system. Base system on specific behaviors or results rather than questioning on potential underlying reasons for behavior such as physical or mental disabilities. Based on reviews of such court decisions, these are characteristics of a system that will better withstand legal scrutiny. 8-42

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