1. Copyright © 2003 by South-Western. All Rights Reserved. CHAPTER NINE HUMAN RESOURCE MANAGEMENT AND MOTIVATION Text by Profs. Gene Boone & David Kurtz Multimedia Presentation by Prof. Milton Pressley The University of New Orleans milton.pressley@uno.edu

2. Copyright © 2003 by South-Western. All Rights Reserved. Describe the importance of human resource management and the responsibilities of human resource managers Describe the importance of human resource management and the responsibilities of human resource managers Explain the role of human resource planning in an organization’s competitive strategy Explain the role of human resource planning in an organization’s competitive strategy Discuss the ways firms recruit and select employees and the importance of compliance with employment-related legislation Discuss the ways firms recruit and select employees and the importance of compliance with employment-related legislation Summarize how firms train and evaluate employees to develop effective workforces Summarize how firms train and evaluate employees to develop effective workforces LEARNING GOALS

3. Copyright © 2003 by South-Western. All Rights Reserved. Identify the methods employers use to compensate employees through pay systems and benefit programs Identify the methods employers use to compensate employees through pay systems and benefit programs Discuss employee termination and the impact of downsizing and outsourcing Discuss employee termination and the impact of downsizing and outsourcing Explain the concept of motivation in terms of satisfying employee needs Explain the concept of motivation in terms of satisfying employee needs Describe how human resource managers apply theories of motivation in attracting, developing, and retaining employees Describe how human resource managers apply theories of motivation in attracting, developing, and retaining employees Identify trends that influence the work of human resource managers in the 21 st century Identify trends that influence the work of human resource managers in the 21 st century LEARNING GOALS

4. Copyright © 2003 by South-Western. All Rights Reserved. © PhotoDisc CHAPTER OVERVIEW Addresses the critical issues of human resource management and motivation Addresses the critical issues of human resource management and motivation Discusses the ways organizations attract, develop, and retain employees Discusses the ways organizations attract, develop, and retain employees Describes the concepts behind motivation Describes the concepts behind motivation Examines the way human resource managers apply the above concepts to increase employee satisfaction and organizational effectiveness Examines the way human resource managers apply the above concepts to increase employee satisfaction and organizational effectiveness

5. Copyright © 2003 by South-Western. All Rights Reserved. HUMAN RESOURCE MANAGEMENT: A VITAL ORGANIZATIONAL FUNCTION Human resource management: function of attracting, developing, and retaining sufficient numbers of qualified employees to perform the activities necessary to accomplish organizational goals Human resource management: function of attracting, developing, and retaining sufficient numbers of qualified employees to perform the activities necessary to accomplish organizational goals Human resource managers responsible for: Human resource managers responsible for: Developing specific programs and activities Developing specific programs and activities Creating a work environment that generates employee satisfaction and efficiency Creating a work environment that generates employee satisfaction and efficiency © PhotoDisc

6. Copyright © 2003 by South-Western. All Rights Reserved. Figure 9.1 Rules for Clerks, 1900

7. Copyright © 2003 by South-Western. All Rights Reserved. HUMAN RESOURCE MANAGEMENT: A VITAL ORGANIZATIONAL FUNCTION Professional employer organizations (PEOs): company that helps small and mid-sized firms with a wide range of human resource services including hiring and training employees, administering payroll and benefits programs, handling workers’ compensation and unemployment insurance, and maintaining compliance with labor laws Professional employer organizations (PEOs): company that helps small and mid-sized firms with a wide range of human resource services including hiring and training employees, administering payroll and benefits programs, handling workers’ compensation and unemployment insurance, and maintaining compliance with labor laws © PhotoDisc

8. Copyright © 2003 by South-Western. All Rights Reserved. Figure 9.2 Human Resource Management Responsibilities

9. Copyright © 2003 by South-Western. All Rights Reserved. HUMAN RESOURCE PLANNING Human resource managers: Human resource managers: Develop staffing plans based on the organization's competitive strategies Develop staffing plans based on the organization's competitive strategies Responsible for adjusting their company’s workforce to meet requirements of: Responsible for adjusting their company’s workforce to meet requirements of: Expanding in new markets Expanding in new markets Reducing costs Reducing costs Adapting to new technology Adapting to new technology Formulate long and short-term plans to provide needed employees Formulate long and short-term plans to provide needed employees © PhotoDisc

10. Copyright © 2003 by South-Western. All Rights Reserved. RECRUITMENT AND SELECTION Human resource managers strive to match applicants’ skills with organizational needs Human resource managers strive to match applicants’ skills with organizational needs © PhotoDisc

11. Copyright © 2003 by South-Western. All Rights Reserved. Figure 9.3 Steps in the Recruitment and Selection Process

12. Copyright © 2003 by South-Western. All Rights Reserved. Finding Qualified Candidates Access internal and external sources Access internal and external sources Consider internal employees first Consider internal employees first Look outside if qualified candidates not available internally Look outside if qualified candidates not available internally © PhotoDisc

13. Copyright © 2003 by South-Western. All Rights Reserved. Selecting and Hiring Employees Must follow the requirements set by federal and state law Must follow the requirements set by federal and state law Failure to comply with equal employment opportunity legislation can expose an employer to fines and penalties, bad publicity, and poor employee morale Failure to comply with equal employment opportunity legislation can expose an employer to fines and penalties, bad publicity, and poor employee morale © PhotoDisc

14. Copyright © 2003 by South-Western. All Rights Reserved. Selecting and Hiring Employees Some firms try to screen out high- risk employees by requiring drug testing for job applicants Some firms try to screen out high- risk employees by requiring drug testing for job applicants © PhotoDisc

15. Copyright © 2003 by South-Western. All Rights Reserved. Selecting and Hiring Employees Employment at will: practice that allows the employment relationship to begin or end at any time at the decision of either the employee or the employer for any reason Employment at will: practice that allows the employment relationship to begin or end at any time at the decision of either the employee or the employer for any reason © PhotoDisc

16. Copyright © 2003 by South-Western. All Rights Reserved. Training builds skills and knowledge that will prepare employees for new job opportunities Training builds skills and knowledge that will prepare employees for new job opportunities ORIENTATION, TRAINING, AND EVALUATION Training Programs

17. Copyright © 2003 by South-Western. All Rights Reserved. Figure 9.4 New Horizons: Communicating the Importance of Training

18. Copyright © 2003 by South-Western. All Rights Reserved. ORIENTATION, TRAINING, AND EVALUATION On-the-job training prepares employees for job duties by allowing them to perform the tasks under the guidance of experienced employees On-the-job training prepares employees for job duties by allowing them to perform the tasks under the guidance of experienced employees Training Programs On-the-Job Training

19. Copyright © 2003 by South-Western. All Rights Reserved. ORIENTATION, TRAINING, AND EVALUATION Classroom and Computer-Based Training: Forms of classroom instruction such as lectures, conferences, audiovisual aids, programmed instruction, and special machines to teach employees everything from basic math and language skills to complex, highly skilled tasks Classroom and Computer-Based Training: Forms of classroom instruction such as lectures, conferences, audiovisual aids, programmed instruction, and special machines to teach employees everything from basic math and language skills to complex, highly skilled tasks Training Programs On-the-Job Training Classroom and Computer-Based Training Classroom and Computer-Based Training

20. Copyright © 2003 by South-Western. All Rights Reserved. ORIENTATION, TRAINING, AND EVALUATION Management development program: training designed to improve the skills and broaden the knowledge of current and potential executives Management development program: training designed to improve the skills and broaden the knowledge of current and potential executives Training Programs On-the-Job Training Classroom and Computer-Based Training Management Development

21. Copyright © 2003 by South-Western. All Rights Reserved. ORIENTATION, TRAINING, AND EVALUATION Performance appraisal: method of evaluation employee’s job performance by comparing actual results with desired outcomes Performance appraisal: method of evaluation employee’s job performance by comparing actual results with desired outcomes Based on this evaluation, managers make objective decisions about compensation, promotions, additional training needs, transfers, or firings Based on this evaluation, managers make objective decisions about compensation, promotions, additional training needs, transfers, or firings Training Programs On-the-Job Training Classroom and Computer-Based Training Management Development Performance Appraisals Performance Appraisals

22. Copyright © 2003 by South-Western. All Rights Reserved. ORIENTATION, TRAINING, AND EVALUATION 360-degree performance review: process that gathers feedback from a review panel of about 8 to 12 people, including co-workers, team members, subordinates, and sometimes customers 360-degree performance review: process that gathers feedback from a review panel of about 8 to 12 people, including co-workers, team members, subordinates, and sometimes customers Training Programs On-the-Job Training Classroom and Computer-Based Training Management Development Performance Appraisals Performance Appraisals

23. Copyright © 2003 by South-Western. All Rights Reserved. COMPENSATIONCOMPENSATION Resource managers work to develop an equitable compensation system spanning wages and salaries plus benefits Resource managers work to develop an equitable compensation system spanning wages and salaries plus benefits Wages: compensation based on an hourly pay rate or the amount of output produced Wages: compensation based on an hourly pay rate or the amount of output produced Salaries: compensation calculated on a weekly, monthly, or annual basis Salaries: compensation calculated on a weekly, monthly, or annual basis © PhotoDisc

24. Copyright © 2003 by South-Western. All Rights Reserved. COMPENSATIONCOMPENSATION Most firms base their compensation policies on five factors: Most firms base their compensation policies on five factors: Salaries and wages paid by others Salaries and wages paid by others Government legislation Government legislation Cost of living Cost of living Firm’s ability to pay Firm’s ability to pay Worker productivity Worker productivity © PhotoDisc

25. Copyright © 2003 by South-Western. All Rights Reserved. COMPENSATIONCOMPENSATION Many employers link pay to superior employee performance Many employers link pay to superior employee performance Such incentive compensation programs may include: Such incentive compensation programs may include: Profit-sharing Profit-sharing Gain sharing Gain sharing Lump-sum bonuses Lump-sum bonuses Pay for knowledge Pay for knowledge © PhotoDisc

26. Copyright © 2003 by South-Western. All Rights Reserved. EMPLOYEE BENEFITS Employee benefits: employee rewards such as health insurance and retirement plans that employers give, entirely or in part, at their own expense Employee benefits: employee rewards such as health insurance and retirement plans that employers give, entirely or in part, at their own expense Some benefits, e.g. Social Security contributions, are required by law Some benefits, e.g. Social Security contributions, are required by law © PhotoDisc

27. Copyright © 2003 by South-Western. All Rights Reserved. Figure 9.5 Types of Employer- Paid Benefits

28. Copyright © 2003 by South-Western. All Rights Reserved. Flexible Benefits Flexible benefit plan (cafeteria plan): benefit system that offers employees a range of options from which they can choose they types of benefits they receive Flexible benefit plan (cafeteria plan): benefit system that offers employees a range of options from which they can choose they types of benefits they receive © PhotoDisc

29. Copyright © 2003 by South-Western. All Rights Reserved. Flexible Work Flexible work plan: employment that allows personnel to adjust their working hours and places of work to accommodate their personal lives Flexible work plan: employment that allows personnel to adjust their working hours and places of work to accommodate their personal lives Flextime: scheduling system that allows employees to set their own work hours within constraints specified by the firm Flextime: scheduling system that allows employees to set their own work hours within constraints specified by the firm © PhotoDisc

30. Copyright © 2003 by South-Western. All Rights Reserved. Flexible Work Compressed workweek: scheduling option that allows employees to work the regular number of weekly hours in fewer than the typical five days Compressed workweek: scheduling option that allows employees to work the regular number of weekly hours in fewer than the typical five days Job sharing: program that allows two or more employees to divide the tasks of one job Job sharing: program that allows two or more employees to divide the tasks of one job Home-based work: program allowing employees (sometimes called teleworkers or telecommuters) to perform their jobs from home rather than at the workplace space Home-based work: program allowing employees (sometimes called teleworkers or telecommuters) to perform their jobs from home rather than at the workplace space © PhotoDisc

31. Copyright © 2003 by South-Western. All Rights Reserved. Figure 9.6 Workers Using the Internet for Business from Home

32. Copyright © 2003 by South-Western. All Rights Reserved. EMPLOYEE SEPARATION Employer or employee can take the initiative to terminate employment Employer or employee can take the initiative to terminate employment Exit interview: conversation designed to find out why an employee decided to leave Exit interview: conversation designed to find out why an employee decided to leave © PhotoDisc

33. Copyright © 2003 by South-Western. All Rights Reserved. DownsizingDownsizing Downsizing: process of reducing a firm’s workforce to reduce costs and improve efficiency Downsizing: process of reducing a firm’s workforce to reduce costs and improve efficiency © PhotoDisc

34. Copyright © 2003 by South-Western. All Rights Reserved. OutsourcingOutsourcing Outsourcing: practice where functions that were performed previously by company employees are contracted to other firms whose employees perform them a contractual basis Outsourcing: practice where functions that were performed previously by company employees are contracted to other firms whose employees perform them a contractual basis Complements today’s focus on business competitiveness and flexibility Complements today’s focus on business competitiveness and flexibility Allows firms to continue performing the functions they do best Allows firms to continue performing the functions they do best © PhotoDisc

35. Copyright © 2003 by South-Western. All Rights Reserved. MOTIVATING EMPLOYEES Effective human resource management makes important contributions to employee motivation Effective human resource management makes important contributions to employee motivation Figure 9.7 Principal Financial Group: Recognizing the Importance of Employee Benefits

36. Copyright © 2003 by South-Western. All Rights Reserved. MOTIVATING EMPLOYEES Morale: mental attitude of employees toward their employer and jobs Morale: mental attitude of employees toward their employer and jobs © PhotoDisc

37. Copyright © 2003 by South-Western. All Rights Reserved. MOTIVATING EMPLOYEES Need: simply a lack of some useful benefit Need: simply a lack of some useful benefit Motive: inner state that directs a person toward the goal of satisfying a felt need Motive: inner state that directs a person toward the goal of satisfying a felt need © PhotoDisc

38. Copyright © 2003 by South-Western. All Rights Reserved. Figure 9.8 The Process of Motivation

39. Copyright © 2003 by South-Western. All Rights Reserved. Maslow’s Hierarchy of Needs Theory Five types of needs: Five types of needs: Physiological needs Physiological needs Safety needs Safety needs Social (belongingness) needs Social (belongingness) needs Esteem needs Esteem needs Self-actualization needs Self-actualization needs © PhotoDisc

40. Copyright © 2003 by South-Western. All Rights Reserved.

41. Motivating Employees through Job Design Job enlargement: job design change that expands an employee’s responsibilities by increasing the number and variety of tasks they entail Job enlargement: job design change that expands an employee’s responsibilities by increasing the number and variety of tasks they entail Job enrichment: change in job duties to increase employees’ authority, responsibility, and skills Job enrichment: change in job duties to increase employees’ authority, responsibility, and skills © PhotoDisc

42. Copyright © 2003 by South-Western. All Rights Reserved. Motivating Employees through Managers’ Attitudes Worker motivation is influenced by the attitudes that managers display towards employees Worker motivation is influenced by the attitudes that managers display towards employees © PhotoDisc

43. Copyright © 2003 by South-Western. All Rights Reserved.

44. Motivating Employees through Managers’ Attitudes Theory X: assumption that employees dislike work and will try to avoid it Theory X: assumption that employees dislike work and will try to avoid it Theory Y: assumption that employees enjoy work and seek social, esteem, and self-actualization fulfillment Theory Y: assumption that employees enjoy work and seek social, esteem, and self-actualization fulfillment Theory Z: assumption that employee involvement is key to productivity and quality of work life Theory Z: assumption that employee involvement is key to productivity and quality of work life

45. Copyright © 2003 by South-Western. All Rights Reserved. Figure 9.9 Theory Z Management: A Blend of American and Japanese Methods

46. Copyright © 2003 by South-Western. All Rights Reserved. HUMAN RESOURCE CONCERNS FOR THE 21ST CENTURY Four kinds of trends -- demographic, workforce, economic, and work/life events -- are shaping responsibilities and practices of human resource managers Four kinds of trends -- demographic, workforce, economic, and work/life events -- are shaping responsibilities and practices of human resource managers

47. Copyright © 2003 by South-Western. All Rights Reserved. Percentage of older people in the workforce is growing Percentage of older people in the workforce is growing Soon, many employees will be juggling the responsibility of caring for aging parents -- sometimes along with child-care responsibilities Soon, many employees will be juggling the responsibility of caring for aging parents -- sometimes along with child-care responsibilities Demographic Trends HUMAN RESOURCE CONCERNS FOR THE 21ST CENTURY

48. Copyright © 2003 by South-Western. All Rights Reserved. Disabled people are entering the workforce in increasing numbers Disabled people are entering the workforce in increasing numbers Workforce is becoming more diverse Workforce is becoming more diverse Demographic Trends HUMAN RESOURCE CONCERNS FOR THE 21ST CENTURY

49. Copyright © 2003 by South-Western. All Rights Reserved. Contingent workers: employees who work part-time, temporarily, only to fill specific contracts Contingent workers: employees who work part-time, temporarily, only to fill specific contracts Use of contingent workers is expected to grow Use of contingent workers is expected to grow Demographic Trends Workforce Trends HUMAN RESOURCE CONCERNS FOR THE 21ST CENTURY

50. Copyright © 2003 by South-Western. All Rights Reserved. Figure 9.10 Current Want-Ads for Contingent Workers

51. Copyright © 2003 by South-Western. All Rights Reserved. Demand for skilled workers is growing Demand for skilled workers is growing Employers concerned with potential shortage of educated and qualified workers Employers concerned with potential shortage of educated and qualified workers Adult literacy continues to be a problem Adult literacy continues to be a problem Wired, globalized marketplace is changing the definition of work hours Wired, globalized marketplace is changing the definition of work hours Demographic Trends Workforce Trends HUMAN RESOURCE CONCERNS FOR THE 21ST CENTURY

52. Copyright © 2003 by South-Western. All Rights Reserved. Globalization means managers and employees with international skills and experience will be needed Globalization means managers and employees with international skills and experience will be needed Human resource plans that address the needs of employees in more than one country will be needed Human resource plans that address the needs of employees in more than one country will be needed Demographic Trends Workforce Trends Economic Trends HUMAN RESOURCE CONCERNS FOR THE 21ST CENTURY

53. Copyright © 2003 by South-Western. All Rights Reserved. Figure 9.11 CIGNA: Providing Benefits for a Global Workforce

54. Copyright © 2003 by South-Western. All Rights Reserved. The growing discrepancy between earnings at the top and bottom of America's income distribution means that some workers will be motivated by relatively basic needs -- making ends meet The growing discrepancy between earnings at the top and bottom of America's income distribution means that some workers will be motivated by relatively basic needs -- making ends meet Continued focus on reducing costs, including labor costs Continued focus on reducing costs, including labor costs Demographic Trends Workforce Trends Economic Trends HUMAN RESOURCE CONCERNS FOR THE 21ST CENTURY

55. Copyright © 2003 by South-Western. All Rights Reserved. Need to accommodate aging workers, single parents with children, and two-income families Need to accommodate aging workers, single parents with children, and two-income families Widespread casual dress Widespread casual dress Some companies are making room for play Some companies are making room for play Demographic Trends Workforce Trends Economic Trends Work/Life Trends HUMAN RESOURCE CONCERNS FOR THE 21ST CENTURY

56. Copyright © 2003 by South-Western. All Rights Reserved. WHAT’S AHEAD Discussion of three ways of improving performance: Discussion of three ways of improving performance: Empowering employees to make decisions Empowering employees to make decisions Leading them to work effectively as teams Leading them to work effectively as teams Fostering clear, positive communication Fostering clear, positive communication © PhotoDisc