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  • 1. The Challenge of Human Resources Management Human ResourceManaging Human Resources ManagementBohlander • Snell 14 edition 14th edition Snell • BohlanderCopyright © 2007 Thomson/South-Western. PowerPoint Presentation by Charlie CookAll rights reserved. The University of West Alabama
  • 2. ObjectivesAfter studying this chapter, you should be able to: 1. Identify how firms gain sustainable competitive advantage through people. 2. Explain how globalization is influencing human resources management. 3. Describe the impact of information technology on managing people. 4. Identify the importance of change management. 5. State HR’s role in developing intellectual capital. 6. Differentiate how TQM and reengineering influenceCopyright © 2007 Thomson HR systems.South-Western. All rightsreserved. 1–2
  • 3. Objectives (cont’d)After studying this chapter, you should be able to: 7. Discuss the impact of cost pressures on HR policies. 8. Discuss the primary demographic and employee concerns pertaining to HRM. 9. Provide examples of the roles and competencies of today’s HR managers.Copyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–3
  • 4. Why Study Human ResourcesManagement• Human Resources Management (HRM)  The process of managing human resources (human capital and intellectual assets) to achieve an organization’s objectives.• “Why Study HRM?”  Staffing the organization, designing jobs and teams, developing skillful employees, identifying approaches for improving their performance, and rewarding employee successes—all typically labeled HRM issues—are as relevant to line managers as they are to managers in the HR department.Copyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–4
  • 5. Competitive Advantage through People• Core Competencies  Integrated knowledge sets within an organization that distinguish it from its competitors and deliver value to customers.• Sustained competitive advantage through people is achieved if these human resources:  Have value.  Are rare and unavailable to competitors.  Are difficult to imitate.  Are organized for synergy.Copyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–5
  • 6. Figure 1–1 Overall Framework for Human Resource ManagementCopyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–6
  • 7. Competitive Challenges and HumanResources Management• The most pressing competitive issues facing firms: 1. Going global 2. Embracing new technology 3. Managing change 4. Managing talent, or human capital 5. Responding to the market 6. Containing costsCopyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–7
  • 8. Challenge 1: Going Global• Globalization  The trend toward opening up foreign markets to international trade and investment• Impact of globalization  “Anything, anywhere, anytime” markets  Partnerships with foreign firms  Lower trade and tariff barriers  NAFTA, EU, APEC trade agreements  WTO and GATTCopyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–8
  • 9. Challenge 1: Going Global (cont’d)• Corporate Social Responsibility  The responsibility of the firm to act in the best interests of the people and communities affected by its activities• Impact on HRM  Different geographies, cultures, laws, and business practices  Issues:  Identifying capable managers and workers  Developing foreign culture and work practice training programs.Copyright © 2007 compensation plans for overseas work  Adjusting ThomsonSouth-Western. All rightsreserved. 1–9
  • 10. Challenge 2: Embracing New Technology• Knowledge Workers  Workers whose responsibilities extend beyond the physical execution of work to include planning, decision making, and problem solving.• Knowledge-Based Training  Online instruction  “Just-in-time” learning via the Internet on company intranetsCopyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–10
  • 11. Influence of Technology in HRM• Human Resources Information System (HRIS)  A computerized system that provides current and accurate data for the purposes of control and decision making.  Benefits:  Store and retrieve of large quantities of data.  Combine and reconfigure data to create new information.  Institutionalization of organizational knowledge.  Easier communications.  Lower administrative costs, increased productivity and response times.Copyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–11
  • 12. Highlights in HRM 2 Most Common HR Information Systems Applications Payroll 76.7% Benefits administration 57.1 Benefits enrollment 41.4 Recruiting—applicant tracking 39.1 Personnel administration 39.1 Training and development 31.6 Employee self-service 24.8 Manager self-service 18.0 Other 3.8Copyright © 2007 ThomsonSouth-Western. All rightsSource: “How HR Managers Use Technology Applications to Control HR Departmentreserved. 1–12Costs,” Human Resource Department Management Report, no. 4–5 (May 2004).
  • 13. HRM IT Investment Factors• Fit of the application to • Time required to the firm’s employee base. implement and train staff• Ability to upgrade members to use HRIS Increased efficiency and • Initial and annual time savings maintenance costs• Compatibility with current • Training time required for systems HR and payroll• Availability of technical supportCopyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–13
  • 14. Challenge 3: Managing Change• Types of Change  Reactive change  Change that occurs after external forces have already affected performance  Proactive change  Change initiated to take advantage of targeted opportunities• Managing Change through HR  Formal change management programs help to keep employees focused on the success of the business.Copyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–14
  • 15. Challenge 3: Managing Change (cont’d)• Why Change Efforts Fail: 1. Not establishing a sense of urgency. 2. Not creating a powerful coalition to guide the effort. 3. Lacking leaders who have a vision. 4. Lacking leaders who communicate the vision. 5. Not removing obstacles to the new vision. 6. Not systematically planning for and creating short- term “wins.” 7. Declaring victory too soon. 8. Not anchoring changes in the corporate culture.Copyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–15
  • 16. Challenge 4: Managing Talent, or HumanCapital• Human Capital  The knowledge, skills, and capabilities of individuals that have economic value to an organization.  Valuable because capital:  is based on company-specific skills.  is gained through long-term experience.  can be expanded through development.Copyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–16
  • 17. Challenge 5: Responding to the Market• Total Quality Management (TQM)  A set of principles and practices whose core ideas include understanding customer needs, doing things right the first time, and striving for continuous improvement.• Six Sigma  A process used to translate customer needs into a set of optimal tasks that are performed in concert with one another.Copyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–17
  • 18. Challenge 5: Responding to the Market(cont’d)• Reengineering and HRM  Fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in cost, quality, service, and speed.  Requires that managers create an environment for change.  Depends on effective leadership and communication processes.  Requires that administrative systems be reviewed and modified.Copyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–18
  • 19. Challenge 6: Containing Costs• Downsizing  The planned elimination of jobs (“head count”).  Layoffs• Outsourcing  Contracting outside the organization to have work done that formerly was done by internal employees.• Offshoring  The business practice of sending jobs to other countries.Copyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–19
  • 20. Figure 1–2 Estimated Number and Types of U.S. Jobs Moving Offshore by 2015Copyright © 2007 ThomsonSouth-Western. All rightsreserved.Source: Near-Term Growth of Offshoring Accelerating, Forester Research, Inc., May 2004. 1–20
  • 21. Challenge 6: Containing Costs (cont’d)• Employee Leasing  The process of dismissing employees who are then hired by a leasing company (which handles all HR- related activities) and contracting with that company to lease back the employees.Copyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–21
  • 22. Challenge 6: Containing Costs (cont’d)• Hidden Costs of Layoff  Severance and rehiring costs  Accrued vacation and sick day payouts  Pension and benefit payoffs  Potential lawsuits from aggrieved workers  Loss of institutional memory and trust in management  Lack of staffers when the economy rebounds  Survivors who are risk-averse, paranoid, and politicalCopyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–22
  • 23. Challenge 6: Containing Costs (cont’d)• Benefits of a No-Layoff Policy  A fiercely loyal,more productive workforce  Higher customer satisfaction  Readiness to snap back with the economy  A recruiting edge  Workers who aren’t afraid to innovate, knowing their jobs are safe.Copyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–23
  • 24. Figure 1–4 Productivity EnhancementsCopyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–24
  • 25. Figure 1–5 Growth of the U.S. Minority PopulationCopyright © 2007 ThomsonSouth-Western. All rightsreserved.Source: U.S. Census Bureau 1–25
  • 26. Figure 1–6 Labor Force and Gender Distributions LABOR FORCE PARTICIPATION RATE BY SEX, PROJECTED 1950–2012 Continuing a historical trend, the labor force participation rate for men will decline as the rate for women increases. LABOR FORCE GROWTH BY SEX, PROJECTED 2002–2012 The number of women in the laborCopyright © 2007 Thomson force is expected to grow at a higher rate than that for men.South-Western. All rightsreserved.Source: U.S. Department of Labor 1–26
  • 27. Figure 1–7 Education PaysCopyright © 2007 ThomsonSouth-Western. All rightsreserved.Source: U.S. Department of Labor 1–27
  • 28. Highlights in HRM 5Copyright © 2007 ThomsonSouth-Western. All rightsSource: Survey data from Gail Robinson and Kathleen Dechant, “Building a Business Case for Diversity,” Academy ofreserved. 1–28Management Executive 11, no. 3 (August 1997): 21–31; permission conveyed through the Copyright Clearance Center, Inc.
  • 29. Cultural Changes Employee Employee Concern for Concern for Rights Rights Privacy Privacy Cultural Cultural Changes Changes Balancing Work Balancing Work Attitudes Attitudes and Family and Family towards Work towards WorkCopyright © 2007 ThomsonSouth-Western. All rightsreserved. 1–29