Human Resource Management -1


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Human Resource Management -1

  1. 1. Chapter 1: Human Resource Management Andrijana Bogdanovska Djurovic New York University 2006
  2. 2. CHAPTER 1 OBJECTIVES <ul><li>Define the term Human Resource Management; </li></ul><ul><li>Describe the strategic importance of Human Resource Management; </li></ul><ul><li>Discuss the role that specialists and operating managers play in performing HRM activities; </li></ul><ul><li>List the main objectives pursued by HRM units in organizations. </li></ul>
  3. 3. Opening Vignette In the begging of the 1990s, Sears, Roebuck and company found themselves in a ten year business downturn; In September 1992 Arthur Martinez began heading up the merchandising group and in 1993 produced a sales increase of more than 9% and a total return for shareholders of 56%; In order to ensure that this success would continue he created a core group of senior executives that become known as the Phoenix Team .
  4. 4. Opening Vignette They devised a questionnaire that was and still is, periodically given to employees; A 5 point improvement of the employee attitudes towards the company and their jobs usually brings 1.3 improvement in customer satisfaction driving a 0.5% increase in revenue growth; On annual bases this equates to $200 million in additional revenue;
  5. 5. Opening Vignette Sears provides extensive training and greater decision making authority to its new sales associated. They use town hall meetings to seek input and disseminate information; On January 1, 1995, Sears University was established in Chicago. They reward the employees by basing all long-term incentives on non-financial as well as financial performance.
  6. 6. What is Human Resource Management? <ul><li>Human resource management is defined as the function or unit in the organization that facilitates the most effective utilization of human resources to achieve the objectives of both the organization and the employees. </li></ul>
  7. 7. Brief History of HRM <ul><li>It can be traced to England, where masons, carpenters, leather workers organized themselves into guilds . </li></ul><ul><li>The Industrial Revolution was a catlizator which further changed the field – a new kind of boss appeared who was not necessary the owner; </li></ul><ul><li>Early contributor: Frederick W Taylor farther of Scientific Management : (1) science not rules of thumb; (2) harmony, not discord; (3) cooperation, not individualism; and (4) maximum output, not restricted output. </li></ul>
  8. 8. Brief History of HRM <ul><li>The appearance of first personnel departments in the 1920s; </li></ul><ul><li>Another early contributor: Human relations movement (Mayo and Roelthisberg); in the late 1960s this movement eventually became a branch of organizational behavior; </li></ul><ul><li>Today: the HRM function is concerned with much more than simple filling, house keeping, and record keeping; it is viewed as a “profit” center not simply a “cost” center. </li></ul>
  9. 9. HRM Evolved as response to Failure of Traditional Personnel Management which was … <ul><li>Fragmented in approach; </li></ul><ul><li>Not responsive to company’s strategic orientation; </li></ul><ul><li>Not well attuned to external envioronment; </li></ul><ul><li>Not seen as a core manageial activity </li></ul>
  10. 10. Contemporary development of HRM <ul><li>In today’s world HRM must be: </li></ul><ul><li>Action-oriented; </li></ul><ul><li>People-oriented; </li></ul><ul><li>Globally-oriented; </li></ul><ul><li>Future-oriented; </li></ul>
  11. 11. ORGANIZATION People People People Mission Strategy Culture Structure People
  12. 12. Objectives of HRM Function <ul><li>1. Helping the organization reach its goals </li></ul><ul><li>“ The HR function is a very key portion of the organization today. That message is coming across consistently in surveys of CEOs . So far the emphasize has been on doing things right. The real jump in effectiveness will come when the focus is placed on doing the right things.” </li></ul><ul><li>Bruce R. Elly Vice-President of Personnel at Pfizer,Inc. </li></ul>
  13. 13. Objectives of HRM Function <ul><li>2. Efficiently employing the skills and abilities of the workforce </li></ul><ul><li>“ To make people’s strengths productive and to benefit customers, stockholders and employees. I believe this was the purpose Walt Disney had in mind when he said his greatest accomplishment was to build the Disney organization with its own people.” </li></ul><ul><li>Clyde Benedict – Chief Personnel Officer of Integon Cooperation </li></ul>
  14. 14. Objectives of HRM Function <ul><li>3. Providing well-trained and well-motivated employees </li></ul><ul><li>“ If you want to improve performance, people must see justice in the rewards you give. Reward good results, but do not reward people who do not perform. Make the goals clear, and how they are measured, with no room for side issues like whether someone is a nice person.” </li></ul><ul><li>Norman Augustine Chairman of Martin Marieta </li></ul>
  15. 15. Objectives of HRM Function <ul><li>4. Increasing employees’ job satisfaction and self-actualization </li></ul><ul><li>For employees to be productive, they must feel that the job is right for their abilities and that they are being treated equitably. </li></ul><ul><li>For many employees, the job is a major source of personal identity. </li></ul>
  16. 16. Objectives of HRM Function <ul><li>5. Achieving Quality of Work Life </li></ul><ul><li>“ At Tandem the critical difference seems to be trust…. Technology and trust have turned Tandem into a mini version of the global village.” </li></ul><ul><li>Jack Fitz-Enz, President of </li></ul><ul><li>Saratoga Institute ( ) </li></ul>
  17. 17. Objectives of HRM Function <ul><li>6. Communicating HRM Policies to All Employees </li></ul><ul><li>“ We can’t afford not to communicate our programs, policies and procedures fully. There are effective, personal development and legal reasons why everyone in the firm has to be HRM-knowledgeable. Communicating HRM programs does not just happen, a manager has to work on it constantly” </li></ul><ul><li>Chuck Kelly, Director of a Small Manufacturing Company </li></ul>
  18. 18. Objectives of HRM Function <ul><li>7. Maintaining Ethical Policies and Socially Responsible Behavior </li></ul><ul><li>IBM received 2002 Best Corporate Citizen award for progressive diversity policies, serving women and minorities, and giving back to the communities. </li></ul><ul><li>The giant has more than 350 000 employees in 164 countries. </li></ul>
  19. 19. Objectives of HRM Function <ul><li>8. Managing Change </li></ul><ul><li>New trends and changes which have occurred in telecommuting, outsourcing, HRM practices, family medical leave, child-care, pay for skills and similar, mean for HR Managers that new, flexible approaches must be initiated and used effectively without jeopardizing the survival of the organization. </li></ul>
  20. 20. Objectives of HRM Function <ul><li>9. Managing Increased Urgency and Faster Cycle Time </li></ul><ul><li>The term of organizational learning becomes more and more important for today’s companies. It provides frame work for leadership behaviors, a culture that encourages and rewards learning, and an emphasis on learning to work more efficiently, quickly and confidently. </li></ul>
  21. 21. Objectives of HRM Function HR Function (1) Helping the organization reach its goals (2) Efficiently employing the skills and abilities of the workforce (6) Communicating HRM Policies to All Employees (7) Ethical Policies and Socially Responsible Behavior (8) Managing Change (4) Increasing employees’ job satisfaction & self-actualization (5) Achieving Quality of Work Life (9) Managing Increased Urgency & Faster Cycle Time (3) Providing well-trained and motivated employees
  22. 22. HRM Activities <ul><li>Staffing: the obtaining of people with appropriate skills, abilities, </li></ul><ul><li>knowledge and experience to fill jobs </li></ul><ul><li>in the oranization; </li></ul><ul><li>Rewards : the design and administration of reward </li></ul><ul><li>systems. The HRM tasks include job </li></ul><ul><li>evaluation, appraisal and enefits. </li></ul><ul><li>Employee development : analysing training reuirements </li></ul><ul><li>to ensure that employees possess the </li></ul><ul><li>knowledge and skills to perform </li></ul><ul><li>satisfactorily in their jobs or to advance in </li></ul><ul><li>the oranisation. Performance appraisal can </li></ul><ul><li>identify key skills and competences. </li></ul>
  23. 23. HRM Activities <ul><li>Employee maintainance: the administration and the </li></ul><ul><li>monitoring of workplace safety, health and </li></ul><ul><li>welfare policies to retain a competent </li></ul><ul><li>workforce and comply with statutary </li></ul><ul><li>standards and regulations; </li></ul><ul><li>Employee / industrial relations: the negotiations </li></ul><ul><li>between management and union over </li></ul><ul><li>decisions affecting employment. </li></ul>
  24. 24. Who Performs HRM Activities? <ul><li>In-house approach: </li></ul><ul><ul><li>HR Manager-specialists </li></ul></ul><ul><ul><li>Operating Managers </li></ul></ul><ul><li>Outsourcing – contracting a vendor for certain HR activities </li></ul>
  25. 25. HR Department Operations Strategy The plan that integrates major objectives Policies Guides to decision making Objectives Goals that are specific and measurable Procedures/Rules Specific directions for decision making
  26. 26. Organization of the HR Department <ul><li>Profit companies; </li></ul><ul><li>Non-profit organizations; </li></ul><ul><li>Governments i.e. state bodies </li></ul>
  27. 27. Conclusions <ul><li>HRM is action oriented, individual oriented, globally oriented and future oriented. It focuses on satisfying the individuals at work; </li></ul><ul><li>HRM is a necessity. Effectively performed it can make the crucial difference between successful and unsuccessful organization; </li></ul><ul><li>In many decisions input, is required from both operating managers and HR specialists; </li></ul>