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N5 Bus Man – 3.1: HRM © BEST Ltd 1 Business Management (National 5) Management of People and Finance 3.1 – Human Resource Management
N5 Bus Man – 3.1: HRM © BEST Ltd 2 What is HRM all about? HUMAN RESOURCE MANAGEMENT (HRM) is all about managing the WORKFORCE so that a business has enough suitably qualified staff to carry out all necessary tasks in an efficient way. Advantages of effective HRM include: ◦ STAFF EFFICIENCY AND MOTIVATION ◦ INCREASED SATISFACTION AND SALES ◦ INCREASED PROFITS AND SECURITY
N5 Bus Man – 3.1: HRM © BEST Ltd 3 Types of Workers SEMI-SKILLED WORKERS AKA manual or blue collar workers No/few formal qualifications No/few related work skills No/limited work experience Perform manual/repetitive jobs Often part time/temporary staff SKILLED WORKERS AKA white collar or professional workers Some/many formal qualifications Some/many related work skills Accept responsibility Perform specialised jobs Usually full time and permanent staff
N5 Bus Man – 3.1: HRM © BEST Ltd 4 Changing Employment Patterns In the UK today, businesses are trying have as flexible a workforce as possible to allow them to react quickly to changes in their markets or technology. This has led to the following trends in Employment Patterns and staff for HRM to manage. ◦ MORE FEMALES IN THE WORKPLACE ◦ FEWER CORE STAFF ◦ MORE CASUAL STAFF ◦ DECLINE OF SECONDARY SECTOR WORK ◦ DEVELOPMENT OF TERTIARY SECTOR WORK ◦ IT REPLACING STAFF
N5 Bus Man – 3.1: HRM © BEST Ltd 5 Implications of Changing Employment Patterns ADVANTAGES of changes in working patterns which HRM should be aware of include the following. ◦ REDUCED OBLIGATIONS SAVES MONEY ◦ REDUCED SPACE MEANS LOWER RENTS ◦ EASY TO MEET DEMAND THROUGH CASUAL STAFF DISADVANTAGES of the above changes in working patterns which HRM should be aware of include the following. ◦ COSTS OF FREQUENT CASUAL RECRUITMENT ◦ POSSIBLE STAFF SHORTAGES ◦ CASUAL STAFF COMMITMENT OR QUALITY MAY BE LOW ◦ LESS RETURN ON HIGH CASUAL TRAINING COSTS
N5 Bus Man – 3.1: HRM © BEST Ltd 6 Recruitment of Staff RECRUITMENT of staff involves getting people with the necessary skills and qualities to apply for a position with your business. The main steps in the recruitment of staff are: ◦ IDENTIFY JOB DETAILS -Job Analysis -Job Description -Person Specification ◦ ADVERTISE VACANCY -Local or National Press -Job Centre Plus -Recruitment Agency -Online Advertisement ◦ RECEIVE APPLICATIONS (as FORMS/CV’s)
N5 Bus Man – 3.1: HRM © BEST Ltd 7 Selection of Staff SELECTION of staff involves looking at the details of all of the people who have applied, and choosing the person who has the qualities that best suit the post. The main steps in the selection of staff are: ◦ STUDY APPLICATIONS RECEIVED ◦ DRAW UP LIST OF BEST APPLICANTS ◦ INTERVIEW CANDIDATES ◦ TEST CANDIDATES ◦ REFERENCES ◦ CHOOSE BEST CANDIDATE AND OFFER JOB ◦ PREPARE AND COMPLETE CONTRACT ◦ REVIEW PROCESS
N5 Bus Man – 3.1: HRM © BEST Ltd 8 Staff Training Businesses should make sure that they provide the following TYPES of STAFF TRAINING. ◦ INDUCTION TRAINING ◦ IN SERVICE RETRAINING These types of training can be delivered through the following METHODS. ◦ ON THE JOB TRAINING ◦ OFF THE JOB TRAINING Staff training is important as it makes sure that: ◦ NECESSARY WORK IS DONE ◦ STAFF ARE DEVELOPED AND MOTIVATED ◦ ORGANISATIONAL PERFORMANCE IS IMPROVED Staff training should be evaluated to ensure that it has had the desired effect.
N5 Bus Man – 3.1: HRM © BEST Ltd 9 Staff Motivation and Retention People work for the following reasons: ◦ TO MAKE MONEY ◦ JOB SATISFACTION ◦ SECURITY ◦ COMPANIONSHIP ◦ PROGRESSION OF SKILLS Businesses must try and account for these reasons to RETAIN their staff and make them MOTIVATED. Common ways of achieving this include: ◦ WAGE SYSTEMS ◦ WORKING CONDITIONS
N5 Bus Man – 3.1: HRM © BEST Ltd 10 Wages System Staff will be motivated and stay in a business if they feel they are well paid using the following WAGES SYSTEMS. ◦ FIXED RATE PAYMENT SYSTEM Salary Contract ◦ VARIABLE RATE PAYMENT SYSTEM Hourly Rate Overtime Rate Piece Rate Commission Bonuses Profit Sharing Schemes
N5 Bus Man – 3.1: HRM © BEST Ltd 11 Working Conditions Staff will receive a CONTRACT OF EMPLOYMENT when they begin a job to give them the details of their post. These details include the WORKING CONDITIONS for their job. WORKING CONDITIONS are they way work will be completed, and the common systems used include the following. FIXED HOURS JOB SHARING FLEXITIME TELEWORKING CONDENSED HOURS
N5 Bus Man – 3.1: HRM © BEST Ltd 12 The importance of motivation and retention Employee motivation and retention is very important, because if staff and managers DO NOT get on about issues such as wages and conditions, then a business will lose customers and profits from the following. ◦ POOR EFFICIENCY ◦ POOR QUALITY ◦ GO SLOW (INDUSTRIAL ACTION) ◦ WORK TO RULE (INDUSTRIAL ACTION) ◦ OVERTIME BAN (INDUSTRIAL ACTION) ◦ STRIKE (INDUSTRIAL ACTION) ◦ PICKETING (INDUSTRIAL ACTION)
N5 Bus Man – 3.1: HRM © BEST Ltd 13 Legislation Compliance - Workplace LEGISLATION affects HRM as it lays down rules for the organisation of workplace and the treatment of staff through the following laws. ◦ HASAW (1974) ◦ DISPLAY SCREEN REGULATIONS (1992) ◦ EMPLOYMENT RIGHTS ACTS (1996) ◦ MINIMUM WAGE ACT (1998) ◦ EQUALITY ACT (2010) The main rules that these laws create are: ◦ UNLAWFUL DISCRIMINATION IS PROHIBITED ◦ EMPLOYMENT PROTECTION ◦ SAFE AND HEALTHY WORKING ENVIRONMENT
N5 Bus Man – 3.1: HRM © BEST Ltd 14 HRM Record Keeping HRM will keep records of the following. ◦ BASIC EMPLOYEE DATA ◦ EMPLOYEE TRAINING DATA ◦ EMPLOYEE ABSENCE DATA ◦ RECRUITMENT AND SELECTION DATA ◦ HOLIDAY DATA ◦ LABOUR TURNOVER DATA ◦ HEALTH AND SAFETY DATA This information will be kept for the following reasons. ◦ MONITOR PERFORMANCE AND PROGRESS ◦ PROVIDE INFO FOR DEVELOPMENT ◦ PROVIDE ADVICE TO NON-HRM STAFF
N5 Bus Man – 3.1: HRM © BEST Ltd 15 Legislation Compliance - Data LEGISLATION affects how HRM manages its electronic records through the following laws. ◦ DATA PROTECTION ACTS (1998) ◦ FREEDOM OF INFORMATION ACT (2002) The main rules that these laws create are: ◦ LEGAL COLLECTION OF DATA ◦ SECURE DATA STORAGE ◦ ACCESS TO DATA HELD
N5 Bus Man – 3.1: HRM © BEST Ltd 16 Which factors affect the work of HRM? The effectiveness of HRM activities undertaken by a business will be affected by the following factors. ◦ INTERNAL FACTORS Finance Human Resources Capital ◦ EXTERNAL FACTORS Political Factors Economic Factors Social Factors Technological Factors Environmental Factors Competitive Factors
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