Man 3301.0001 spring, 2011 kleiman hrm5e-ppt_chapter_01

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Man 3301.0001 spring, 2011 kleiman hrm5e-ppt_chapter_01

  1. 1. Chapter 1 Human Resource Management and Competitive Advantage © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  2. 2. Chapter Outline • 1-1 Human Resource Management • 1-2 Who Is Responsible for Developing and Implementing HRM Practices? • 1-3 Gaining a Competitive Advantage • 1-4 Competitive Advantage and HRM © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  3. 3. 1-1 Human Resource Management • Human resource management: Consists of practices that help the organization deal effectively with its people during the various phases of the employment cycle. • Three phases of the employment cycle:    Pre-selection – Planning practices. Selection – Recruiting applicants and selecting the most qualified. Post-selection – Practices designed to maximize the performance and satisfaction levels of employees. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  4. 4. 1-1a HRM Preselection Practices • Human resource planning: Anticipate and meet changing needs relating to the acquisition, deployment, and utilization of employees; accomplished through strategic planning and demand and supply forecasting. • Job analysis: A systematic procedure for gathering, analyzing, and documenting information about particular jobs. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  5. 5. Figure 4-1 Job Analysis © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  6. 6. 1-1b HRM Selection Practices • Recruitment: Locate and attract job applicants for particular positions quickly, cost efficiently, and legally. • Selection: Assessing and choosing job candidates through a technically sound and legal procedure. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  7. 7. 1-1c HRM Postselection Practices • Training and development: Planned learning experiences that teach workers how to perform their current or future jobs effectively. • Performance appraisal: Measures the adequacy of employees’ job performances and communicates these evaluations to them. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  8. 8. 1-1c HRM Postselection Practices (cont.) • Compensation: Entails pay and benefits, and aims to establish and maintain a competent and loyal workforce at an affordable cost. • Productivity improvement programs: Tie job behavior to rewards, and aim to motivate employees to engage in appropriate job behaviors. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  9. 9. 1-1d HRM Practices Influenced by External Factors • Legal and environmental issues:   Federal, state, and local laws are designed to guarantee employees’ rights to fair and safe treatment. Social, economic, and technological events also strongly influence HRM practices. • Workplace justice laws: Addresses the issue of employee rights. • Union influences: Regulate many HRM practices such as discipline, promotion, grievance procedures, and overtime allocations. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  10. 10. 1-1d HRM Practices Influenced by External Factors (cont.) • Safety and health concerns: Institution of accident prevention programs, wellness programs, and employee assistance programs to ensure the health and mental well-being of employees. • International influences: Development of globally oriented managers who understand foreign languages and cultures, as well as the dynamics of foreign marketplaces. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  11. 11. 1-2 Who Is Responsible for Developing and Implementing HRM Practices? • Human resource professionals    • Establish HRM procedures and methods. Monitor and evaluate HR practices. Advise and assist managers on HRM-related matters. Line managers    Direct employees’ day-to-day tasks. Implement HRM practices. Provide HR professionals with needed inputs for developing effective practices. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  12. 12. 1-3 Gaining a Competitive Advantage & 1-3a Competitive Advantage Defined • Firms gain competitive advantage by effectively managing their human resources. • Competitive advantage is a status achieved by a company when gaining a superior marketplace position relative to its competition. • This is accomplished through cost leadership and product differentiation. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  13. 13. 1-3b Cost Leadership • Cost leadership strategy: A firm provides the same services or products as its competitors, but produces them at a lower cost. • A firm can reduce its per unit cost by increasing the value of Number of units produced/total cost of production. • Per unit cost can be reduced by:    Using new technology. Devising more efficient work methods . Cutting overhead costs. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  14. 14. 1-3c Product Differentiation • Occurs when a firm produces a product or service that is preferred by buyers. • A firm can accomplish this aim by:     • Creating a better quality product or service. Providing innovative products or services. Choosing a superior location. Promoting and packaging its product to create a perception of higher quality. Creates a competitive advantage if the firm’s customers are willing to pay enough to cover extra production costs. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  15. 15. 1.1 On the Road to Competitive Advantage Gaining Competitive Advantage at Trader Joe’s • No one signed up for this extra credit opportunity © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  16. 16. 1-4 Competitive Advantage and HRM • Studies have indicated:   A strong link between HRM effectiveness and productivity. The impact of a broad range of HRM practices on shareholder return; 15–30 percent of the total value of a company could be attributed to the quality of its HRM practices. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  17. 17. 1-4a Evidence Linking HRM Practices to Competitive Advantage • Presentations by Alex Chalashtori – four points • Jeffrey Pfeffer identified 16 HRM practices:         Employment security Selectivity in recruiting High wages Incentive pay Employee ownership Information sharing Participation and empowerment Teams and job redesign © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  18. 18. 1-4a Evidence Linking HRM Practices to Competitive Advantage (cont.) • Jeffrey Pfeffer identified 16 HRM practices (cont.):         Training and skill development Cross-utilization and cross-training Symbolic egalitarianism Wage compression Promotion from within Long-term perspective Measurement of practices Overarching philosophy © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  19. 19. 1-4b A Model Linking HRM Practices to Competitive Advantage • Direct path: The way an HRM practice is carried out can, by itself, have an immediate impact on competitive advantage.   Cost leadership can be achieved through the use of effective HRM practices. Firms doing the best job of containing HRM-related costs stand to gain a financial advantage over their competitors. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  20. 20. Figure 1-4 A Model Linking HRM Practices to Competitive Advantage © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  21. 21. 1-4b A Model Linking HRM Practices to Competitive Advantage (cont.) • Indirect path: An HRM practice can impact competitive advantage by causing certain outcomes, which, in turn, create competitive advantage.    HRM practices  Employee-centered outcomes Employee-centered outcomes  Organizationcentered outcomes Organization-centered outcomes  Competitive advantage © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  22. 22. 1-4b A Model Linking HRM Practices to Competitive Advantage (cont.) • HRM Practices  Employee-centered outcomes    Competence – Extent of knowledge, skills, and abilities possessed for the job. Motivation – Willingness to exert necessary effort to perform the job well. Work related attitudes – where it all comes together. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  23. 23. 1-4b A Model Linking HRM Practices to Competitive Advantage (cont.) • HRM Practices  Employee-centered outcomes  Work-related attitudes – Extent of - - Job satisfaction – Favorableness of employee attitudes toward their jobs. Organizational commitment – Psychological attachment to, identification with, and involvement in the organization. Organizational citizenship – Willingness to engage in behaviors that help the organization achieve its goals. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  24. 24. 1-4b A Model Linking HRM Practices to Competitive Advantage (cont.) • Employee-centered outcomes  Organizationalcentered outcomes     Output – Quantity, quality, and innovativeness of the product or service offered by a firm. Employee retention – Amount of employee turnover. Legal compliance – Conformance to various employment laws. Company reputation/Image – Favorable view of the organization by potential applicants and customers. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  25. 25. 1-4b A Model Linking HRM Practices to Competitive Advantage (cont.) • Achievement of employee-centered outcomes leads to favorable organization-centered outcomes.     Positive job attitude, motivation, and high productivity. Reduction of HRM-related lawsuits. Enhances the reputation of the company. Helps the customers view the company positively. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  26. 26. 1-4b A Model Linking HRM Practices to Competitive Advantage (cont.) • Organization-centered outcomes  Competitive advantage   Cost leadership – Achieved through using technology, minimizing turnover rates, and avoiding lawsuits resulting from noncompliance. Product differentiation – Achieved through: - Individuals performing their jobs well. Treating employees in a manner that helps retain longterm employees. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.
  27. 27. 1-4c HRM Practices and Sustained Competitive Advantage • Management of human resources is less susceptible to imitation. • The competitive advantage achieved through HRM practices is likely to be more sustainable.   Competitors rarely have access to a firm’s HRM practices; the practices are not very visible to outsiders. Even when these practices are visible, their impact may not be as favorable when used by competitors. © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license. All rights reserved.

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