Copyright ©2011 Pearson Education 6 Chapter Managing Human Resources Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education Learning Objectives Describe the key components of the HRM process and what influences it Discuss the tasks associated with identifying and selecting competent employees Explain how employees are provided with needed skills and knowledge Describe strategies for retaining competent, high-performing employees Discuss contemporary issues in managing human resources Copyright ©2011 Pearson Education

What Is the Human Resource Management Process? Human Resource Management (HRM) The management function concerned with getting, training, motivating, and keeping competent employees In many organizations, the activities or process that grouped under HRM are done by specialists. The quality of an organization is to a large degree determined by the quality of the people it employs. Success for most organizations depends on finding the employees with the skills to successfully perform the tasks required to attain the company’s strategic goals. Staffing and human resource management decisions and methods are critical to ensuring that the organization hires and keeps the right people. Copyright ©2011 Pearson Education

What Is the Human Resource Management Process? because not all managers have HRM staff, many managers in small and large organization involved in hiring, interviewing, making decisions about employees training , and evaluating their performance without the assistance of HRM specialist. So, even if an organization provides HRM support activities, every manager is involved with human resource decision in his unit. Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education HRM process After the establishing of the organization’s strategy>>> the organization structure is designed>> it is the time to add the people. There are eight activities which are the key component of an organization’s human resource management process. The first three activities in the HRM process represent employment planning: 1. the addition of staff by recruitment. 2. the reduction in staff through downsizing. 3. the selection. Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education Notice in Exhibit 6-1 that the entire process is influenced by the external environment. Many of the factors introduced in Chapter 2 directly affect all management practices, but their effect is felt the most in managing the organization’s human resources, because whatever happens to an organization ultimately influences what happens to its employees Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education HRM process Once the competent employees are selected, they have to be adapted to the organization and ensure that their job skills and knowledge are kept current. So the next two activities in the HRM process are accomplished through orientation and training. The last steps in the HRM process are designed to identify performance goals, correct performance problems, and help employees sustain a high level of performance. Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education HRM process Notice that the entire process is influenced by the external environment because what ever happens to an organization ultimately influences what happens to its employees. So before review the process of HRM, let’s examine the legal environment, especially, employment and discrimination laws. Copyright ©2011 Pearson Education

What Is the Legal Environment of HRM? Since the mid-1960s, the federal government in the United States has greatly expanded its influence over HRM by enacting a number of laws and regulations including: Affirmative Action Programs Programs that ensure that decisions and practices enhance the employment, upgrading, and retention of members of protected groups Since the mid-1960s, the federal government in the United States has greatly expanded its influence over HRM by enacting a number of laws and regulations (see Exhibit 6-2 for examples) Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education

What Is the Legal Environment of HRM? Therefore, U.S managers are not free to choose whom they hire, promote and fire. Although these regulations helped to reduce employment discrimination and unfair employment practices, they have, at the same time, reduced management’s discretion over HR decisions. Copyright ©2011 Pearson Education

Are HRM Laws the Same Globally? HRM laws aren’t the same globally. Therefore, you need to know the laws and regulations that apply in your locale. To illustrate the point, we highlight the federal legalization in countries such as: Canada, Mexico, Australia, and Germany. Canada: Canadian laws to HRM practices is similar to those in the U.S. The Canadian Human Rights Act prohibits discrimination on the basis of race, religion, age, sex, physical or mental disability. However, the difference is that it involves more decentralization of lawmaking to the provincial level. Ex. Discrimination on the basis of language is not prohibited any where except in Quebec HRM laws aren’t the same globally. You need to know the laws and regulations that apply in your locale Copyright ©2011 Pearson Education

Are HRM Laws the Same Globally? Mexico: Employees are more likely to be unionized in Mexico than they are in the U.S. Labor matters in Mexico are governed by the Mexican Federal Labor Law. Those who violate the Mexican Federal Labor Law are subject to penalties including fines, and even jail sentence for employers who fail to pay the salary. Australia: A significant proportion of the workforce is unionized Copyright ©2011 Pearson Education

Are HRM Laws the Same Globally? Germany: German laws requires companies to practice representative participation. The two most common forms of representative participation are: Work Councils (link employees with management) Groups of nominated or elected employees who must be consulted when management makes decisions involving personnel Board Representatives Employees who sit on a company’s board of directors and represent the interest of employees Copyright ©2011 Pearson Education

How Do Managers Identify & Select Competent Employees This first phase (stage) of the HRM process involves three tasks: Employment planning Recruitment and downsizing And selection Copyright ©2011 Pearson Education

What Is Employment Planning? The process by which managers ensure they have the right numbers and kinds of people in the right places at the right time Employment planning translates the org’s mission and goals into HR plan that allow org to achieve those goals through : Assessing both current and future human resource needs. Developing a plan to meet those needs. Employment planning is the process by which managers ensure that they have the right number and kinds of people in the right places at the right times, people who are capable of effectively and efficiently completing those tasks that will help the organization achieve its overall goals. Employment planning, then, translates the organization’s mission and goals into an HR plan that will allow the organization to achieve those goals Copyright ©2011 Pearson Education

Conducting an employee assessment Managers begin by reviewing the current human resource status. This review is done by Human resource inventory: A report listing important information about employees such as, name, education, training, skills, languages spoken, and so forth. Those info is derived from forms completed by employees. This inventory allows managers to assess what talents and skills are currently available in the org. Copyright ©2011 Pearson Education

Conducting an employee assessment Another parts of the current assessment are: Job Analysis An assessment that defines jobs and the behaviors necessary to perform them The purpose of job analysis is to determine the kinds of skills, knowledge, and attitudes needed to successfully perform each job. Whereas the human resources inventory is concerned with telling management what individual employees can do, job analysis is more fundamental. It’s typically a lengthy process, one in which workflows are analyzed and skills and behaviors that are necessary to perform jobs are identified. Copyright ©2011 Pearson Education

Conducting an employee assessment Job Description A written statement that describes a job What job holder does, how its done, why its done It portray (describe) job content, environment, and condition of employment. Job Specification A written statement of the minimum qualifications that a person must possess to perform a given job successfully Copyright ©2011 Pearson Education

Conducting an employee assessment The job description and job specification are important documents when managers begin recruiting and selecting. Hiring individual on the basis of the information contained in these two documents helps ensure that the hiring process does not discriminate. Copyright ©2011 Pearson Education

How are future employee needs determined Future human resource needs are determined by the organization’s strategic direction. demand for human resource (employees) is a result of demand for the organization’s products or services On the basis of an estimate of total revenue, managers can attempt to establish the number and mix of people needed to reach that revenue. The overall organizational goals and the resulting revenue forecast provide the major input in determining the organization’s HR requirements. Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education Developing the plan After assessing both current capabilities and future needs, managers are able to estimate: 1. Shortages ( both in numbers and kinds) 2. Highlight areas in which the organization is overstaffed. A plan can be developed that matches these estimates with forecast of future labor supply. Copyright ©2011 Pearson Education

HOW DO ORGANIZATIONS RECRUIT EMPLOYEES? Recruitment The process of locating, identifying, and attracting capable applicants Applicants can be found by using several sources Once managers know their current staffing levels—whether understaffed or overstaffed—they can begin to do something about it. If one or more vacancies exist, they can use the information gathered through job analysis to guide them in recruitment—that is, the process of locating, identifying, and attracting capable applicants. Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education Applicants can be found by using several sources, including the Internet. Exhibit 6-3 offers some guidance. The source that’s used should reflect the local labor market, the type or level of position, and the size of the organization. Copyright ©2011 Pearson Education

How do managers handle layoffs Downsizing The planned elimination of jobs in an organization Once the recruiting effort has developed a pool of applicants, the next step in the HRM process is to determine who is best qualified for the job. In essence, then, the selection process is a prediction exercise: It seeks to predict which applicants will be “successful” if hired; that is, who will perform well on the criteria the organization uses to evaluate its employees. Copyright ©2011 Pearson Education

How Do Managers Select Job Applicants? Selection Process Screening job applicants to ensure that the most appropriate applicant are hired It is a prediction exercise: it seek to predict which applicants will be “successful” if hired. Any selection decision can result in four possible outcomes: 1. Two indicate correct decisions(accept the successful) or (reject the unsuccessful) 2. Two indicate errors (accept the unsuccessful) or (reject the successful) Once the recruiting effort has developed a pool of applicants, the next step in the HRM process is to determine who is best qualified for the job. In essence, then, the selection process is a prediction exercise: It seeks to predict which applicants will be “successful” if hired; that is, who will perform well on the criteria the organization uses to evaluate its employees. Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education

How Do Managers Select Job Applicants? Reliability The degree to which a selection device measures the same characteristic consistently…. If a test is reliable , any individual score should be stable over time (assuming that the characteristics it is measuring are also stable. No selection device can be effective if it is low in reliability. To be effective predictors, selection devices must be possess an acceptable level of consistency. Copyright ©2011 Pearson Education

How Do Managers Select Job Applicants? Validity The proven relationship between a selection device and some relevant criterion (measure)….for examples interviews, tests and physical examination Selection device should be directly related to successful job performance Copyright ©2011 Pearson Education

How effective are tests and interviews as selection devices Managers can use a number of selection devices to reduce accept and reject errors. The best known devices include: written test, performance-simulation tests and interviews. Written tests: Include tests of intelligence, aptitude, ability, and interest. Many org cannot validate that their written tests were job related. Managers can use a number of selection devices to reduce accept and reject errors. The best known devices include written and performance-simulation tests and interviews Copyright ©2011 Pearson Education

How effective are tests and interviews as selection devices One criticism of written tests is that they may measure characteristics which are not related to job performance. As a result, performance-simulation tests are gaining popularity Performance-Simulation Tests Selection devices based on actual job behaviors The best known performance-simulation tests are: Work sampling (miniature replica of the job) >>routine jobs Assessment centers (simulating real problems)>> managerial personal Copyright ©2011 Pearson Education

How effective are tests and interviews as selection devices Interviews: It is a universal selection device Interviews can be reliable and valid selection tool but too often they are not when they are unstructured and unorganized ( not well standardized) The biases that could take place in not structured and organized interview ( page 190) Behavioral or situation interview: the applicants are observed not only for what they say, but also how they behave. Behavioral interviews are eight times more effective for predicting successful job performance Copyright ©2011 Pearson Education

Closing the Deal –hiring the employee Providing only details of positive aspects of a job may lead to satisfaction problems later. To increase job satisfaction among employees and reduce turnover, manager should consider: Realistic Job Preview (RJP) A preview of a job that provides both positive and negative information about the job and the company Research indicate that applicants who been given realistic job preview>> are better to cope with frustrating elements of job than who been given only inflated info. To increase job satisfaction among employees and reduce turnover, managers should consider a realistic job preview (RJP). An RJP includes both positive and negative information about the job and the company Copyright ©2011 Pearson Education

How Are New Hires Introduced to the Organization? Orientation Introducing a new employee to the job and the organization The major goals of the orientation are: 1. to reduce initial anxiety that new employees feel when they begin a new job. 2. to familiarized new employees with the job, the work unit, and the organization as a whole Once a job candidate has been selected, he or she needs to be introduced to the job and organization. This introduction is called orientation Employee training is a learning experience that seeks a relatively permanent change in employees by improving their ability to perform on the job. Thus, training involves changing skills, knowledge, attitudes, or behavior Copyright ©2011 Pearson Education

How Are New Hires Introduced to the Organization? Job orientation: The new employee’s duties and responsibility are clarified and how his or her performance will be evaluated Work unit orientation: Familiarizes the employee with the goals of the unit, how the job contribute to the unit’s goals, introduce the employee to his or her coworkers. Organization orientation: Inform the new employee about the org’s goals, history, philosophy, procedure and rules. Copyright ©2011 Pearson Education

WHAT IS EMPLOYEE TRAINING A learning experience that seeks a relatively permanent change in employees by improving their ability to perform on the job Training involve changing skills, knowledge, attitude, or behavior. Managers, of course, are responsible for deciding when employees are in need of training and what form that training should take. Copyright ©2011 Pearson Education

WHAT IS EMPLOYEE TRAINING Determining training needs involves answering several questions. the leading questions are suggesting the kind of signals that can warn a manager when training may be necessary. The more obvious ones are related to productivity. Indication that job performance is declining include decreasing in production numbers, lower quality, and more accidents. Managers must recognize that training may be required because the workplace is evolving. Employees will be affected as a result of job redesign or technological changes. Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education The leading questions in Exhibit 6-6 suggest the kinds of signals that can warn a manager when training may be necessary. The more obvious ones are related directly to productivity Copyright ©2011 Pearson Education

How are employees trained Most training take place on the job, it is simple and cost less. However, on- the-job training can disturb the workplace and result in increase in errors. Also, some skill training is too complex to learn on the job and must take place outside the work. The most popular training methods or types are: 1. on- the- job training 2. out-the-job training Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education Many different types of training methods are available. For the most part, we can classify them as on-the-job or off-the-job training. The more popular training methods are summarized in Exhibit 6-7. Copyright ©2011 Pearson Education

How manager can ensure that training is working The training programs are evaluated by asking the opinion of several managers, representatives from HRM, and a group of worker who have recently completed a training program If the comment are generally positive, the program may get favorable evaluation and will be continued. Also, training could be evaluated in terms of how much the participants learned; (did their behavior change?) Copyright ©2011 Pearson Education

How do org retain competent, high- performing employees? Two HRM activities that play a role in this are: Managing employee performance. Developing an appropriate compensation and benefit program Performance Management System A system that establishes performance standards and evaluating performance in order to arrive at objective human resource decision such as pay increase and training needs Copyright ©2011 Pearson Education

How to evaluate employee performance ? There is a list of specific appraisal techniques (methods) such as: 360-degree appraisal: An appraisal device that seeks feedback from a variety of sources for the person being rated These sources are: bosses, peers, team members, and customers. Studies report that the positive result of 360-degree appraisal include more accurate feedback, empowering employees, and reducing subjective factors in the evaluation process. It’s important for managers to get their employees to achieve performance levels that the organization considers desirable. How do managers ensure that employees are performing as well as they’re supposed to? In organizations, the formal means of assessing the work of employees is through a systematic performance appraisal process. Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education We list specific appraisal techniques in Exhibit 6-8. Copyright ©2011 Pearson Education

What Happens If an Employee’s Performance Is Not Up to Par? If the problem is associated with an employee’s lack of desire to do the job, not with his abilities, it become a discipline problem. Discipline Actions taken by a manager to enforce an organization’s standards and regulations such as verbal or written warning, suspension and even termination. If, for some reason, an employee is not meeting his or her performance goals, a manager needs to find out why. If the problem is associated with an employee’s lack of desire to do the job, not with his or her abilities, it becomes a discipline problem Copyright ©2011 Pearson Education

What Happens If an Employee’s Performance Is Not Up to Par? Or manager can try counseling: Employee Counseling (finding ways to fix the problem) A process designed to help employees overcome performance-related problem. It attempt to assist employees in getting help to his problem by knowing why he lost his desire or ability to work productively. If the employee does not accept the help, the disciplinary actions must be taken. Copyright ©2011 Pearson Education

How Are Employees Compensated? Developing an effective and appropriate compensation system is an important part of the HRM process. It can help in attract and retain competent and talented individual who help the org to accomplish its goals. The compensation system has an impact on its strategic performance, therefore, managers must develop a compensation system that reflect the changing nature of work and workplace in order to keep people motivated. Developing an effective and appropriate compensation system is an important part of the HRM process. It can help attract and retain competent and talented individuals who help an organization accomplish its mission and goals. In addition, an organization’s compensation system has been shown to have an impact on its strategic performance Copyright ©2011 Pearson Education

How are pay levels determined Compensation Administration The process of determining a cost-effective pay structure that will attract and retain employees, provide an incentive for them to work hard, and ensure that pay levels will be perceived as fair The primary pay determination is the kind of job. The higher skills, knowledge, and abilities needed in the job>> the greater responsibility and authority>> the higher the pay Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education How do manager determine who gets paid what? (factors influence compensation and benefits) Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education Compensation (cont.) Many organizations are using alternatives approaches to determine compensation including: Skill-based Pay A pay system that rewards employees for the job skills and competencies they can demonstrate Variable Pay A pay system in which an individual’s compensation is contingent on performance Copyright ©2011 Pearson Education

Why do org offer employee benefits Nowadays, organization has to look further than just designing a compensation system and annual salary Employee Benefits Nonfinancial rewards designed to enrich employees’ lives Many organizations legally required to provide social security, life and disability insurance, retirement programs, and health insurance. Copyright ©2011 Pearson Education

What contemporary HRM issues face managers? There are several HR issues facing today’s managers, including: downsizing, workforce diversity, sexual harassment, workplace spirituality, and HR costs. Downsizing: After downsizing, stress, frustration, anxiety, and anger are typical reactions of both individuals being laid off and the job survivors. A new syndrome is Layoff-survivor sickness: a set of attitudes, perceptions, and behaviors of employees who survive involuntary staff reductions Copyright ©2011 Pearson Education

How can workforce diversity be managed, and what is sexual harassment? Improving workforce diversity requires managers to widen their recruiting net by diverse their recruitment sources. In terms of selection process, applicants should be comfortable with organization’s culture and organization should understand their differences. Sexual Harassment Any unwanted action or activity of a sexual nature that explicitly or implicitly affects an individual’s employment, performance, or work environment Sexual harassment is a serious issue in both public and private sector organizations. More than 12,000 complaints are filed with the EEOC each year, with more than 15 percent of the complaints filed by males. Settlements in some of these cases incurred a substantial cost to the companies in terms of litigation. It’s estimated that sexual harassment is the single largest financial risk facing companies today Copyright ©2011 Pearson Education

What Is Workplace Spirituality? A spiritual culture where organizational values promote a sense of purpose through meaningful work that takes place in the context of community Organizations that promote a spiritual culture recognize the employees have to find meaning and purpose in their work. What differentiate spiritual organizations from their nonspiritual counterparts. There are several characteristics tend to be associated with spiritual org Workplace spirituality is not about organized religious practices. It’s not about theology or about one’s spiritual leader. Rather, workplace spirituality is about recognizing that employees have an inner life that nourishes and is nourished by meaningful work that takes place in the context of an organizational community Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education Although research is fairly new in this arena, several characteristics tend to be associated with a spiritual organization.73We list them in Exhibit 6-11. Copyright ©2011 Pearson Education

Managing and building Your Career Career Module Managing and building Your Career Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education Building Your Career Career: The sequence of work positions held by a person during his or her lifetime Before many years, Career Development Programs used to be designed to help employees advance their work lives within a specific organization. Now, career development is not the organization’s responsibility, the employees will be responsible for designing, guiding and developing their own career. Boundaryless Career: When an individual takes personal responsibility for his or her own career. Copyright ©2011 Pearson Education

How Can I Have a Successful Career? Assess Your Personal Strengths and Weaknesses Where do your natural talents lie? Everyone has some thing that they do better than others and some things where they're weak, focus in your strengths. Identify Market Opportunities Where are tomorrow’s job opportunities? Take Responsibility for Managing Your Own Career _ Think of your career as your business. Develop Your Interpersonal Skills Interpersonal skills, especially the ability to communicate, strong interpersonal skills are likely to give you a competitive edge. Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education Career Success (cont.) Practice Makes Perfect If you want to excel in any field, you should expect to have to put in a lot of deliberate practice (repeated activities) Stay Up-to-Date To keep your career on track, you need to make learning a lifetime commitment Network Create and maintaining beneficial relationships with others in order to accomplish your goals Stay Visible: Network can keep you visible. Increase your mobility and value in the marketplace by keeping visible Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education Career Success (cont.) Seek a Mentor Employees with mentors are likely to have enhanced mobility and increased knowledge of the organization Leverage Your Competitive Advantage Develop skills that will give you a competitive advantage in the marketplace don’t Shun Risks It’s OK to Change Jobs To keep your skills fresh, your income increasing, and your job tasks interesting, it will be increasingly likely that you’ll need to change employers Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education Career Success (cont.) Opportunities, Preparation, and Luck = Success Success is a matter of matching up opportunities, preparation and luck. If you are lucky, you will recognize those opportunities, have made a proper preparations, and then act on them. You can not control luck, but you can control your preparation and willingness to act when opportunities knocks Copyright ©2011 Pearson Education

Copyright ©2011 Pearson Education