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CHAPTER 10 Managing Human Resources


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Human Resource Management Process

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CHAPTER 10 Managing Human Resources

  1. 1. University of Wah Chapter 10 Managing Human ResourcesBS-CS-4th‘B’What is Human Resource Management?HRM is the management of people working in an organization, it is a subject related to human. is themanagement of an organizations workforce, or human resources. It is responsible for the attraction,selection, training, assessment, and rewarding of employees.The management function that deals with recruitment, placement, training, development oforganization members.HRM can be defined as all the practices, systems and procedures implemented to attract,acquire, develop and manage human resources to achieve the goals of an organization. Simply itis managing the employment relationship.Human Resource Management consists of all the actions that an organization takes to attract,develop, and retain quality employees.Example of Organization: Starbucks is one of the best known and fastest growing companies in theworld. Starbucks Coffee Company has one of the most experienced and well skilled HR departments.Importance of “Human Resource Management”:Human Resource Management is The Heart of All Organizations 15 % success is due to technical skillsand 85 % due to the skills in human engineering.Staff is the most important resource of an organization.Human resource is the key ingredient to success.“Human resource” creates organizational accomplishments and innovations.As a necessary part of the organizing function of managemento Selecting , training , and evaluating the work forceAs an important strategic toolo HRM helps establish an organization’s sustainable competitive advantage.Adds value to the firmo High performance work practices lead to both high individual and high organizationalperformance.Self-managed teamsDecentralized decision makingTraining programs to develop knowledge, skills, and abilitiesFlexible job assignmentsOpen communicationPerformance-based compensationStaffing based on person–job and person–organization fitIt helps in selection and recruitment of individuals that are right for a given position in the companyCorporate Level:For an enterprise effective HRM leads to attainment of its goal efficiently and effectively. HRM helps
  2. 2. University of Wah Chapter 10 Managing Human ResourcesBS-CS-4th‘B’enterprise in the following ways.a. Hiring required skill set and retaining them through effective human resource planning,recruitment, selection, placement, orientation and promotion policies.b. Development of employees by enhancing necessary skills and right attitude among employeesthrough training, development, performance appraisals etc.c. HRM also takes care of optimum utilization of available human resource.d. HRM also ensures that organization has a competent team and dedicated employees in future.Significance at Professional Levela. HRM also leads to improved quality of work life, it enables effective team work among employeesby providing healthy working environment. It also contributes to professional growth in variousways such asb. By providing opportunities for personal development of an employee, Enabling healthyrelationships among teams and allocating work properly to employees as well as teams.Significance at Social Level:a. HRM plays important role in the society, it helps labor to live with pride and dignity by providingemployment which in turn gives them social and psychological satisfaction.b. HRM also maintains balance between open jobs and job seekers.Significance at National Level:HRM plays a very significant role in the development of nation. Efficient and committed humanresource leads to effective exploitation and utilization of nation’s natural, physical and financialresources. Skilled and developed human resource ensures the development of that country. Ifpeople are underdeveloped then that country will be underdeveloped. Effective HRM enhanceseconomic growth which in turn leads to higher standard of living and maximum employment.High performance work practices:Work practices that maximize the fit between the companys social system and technology. Highperformance is key to organizational success.• Self-managed teams• decentralization of decision making• Employment security• Training programs to develop knowledge, skills, and abilities• Flexible job assignments• Open communication• Performance based compensation• Staffing based on person job and person organization fitExternal Factors Affect Human Resource Management?There are many factors that would affect human resource management.However some are considered to be:
  3. 3. University of Wah Chapter 10 Managing Human ResourcesBS-CS-4th‘B’Political Climate: The political climate can have a great affect on any business and subsequent businessdepartments such as human resource management. If the government decides on spending cuts orincreasing taxes on businesses then this will dramatically affect the running of the business. Departmentbudgets may have to be trimmed or the department may even have to be completely scrapped.Economic climate: If there is high inflation employees will demand more and if there is rapid economicgrowth then more employment opportunities will be available and in good economical conditions skilledlabor is also easily available.Environmental Factors Affecting HRM:Employee Labor Unions Organizations that represent workers and seek to protect their interests through collectivebargaining. Collective bargaining agreement– A contractual agreement between a firm and a union elected to represent a bargainingunit of employees of the firm in bargaining for wage, hours, and working conditions.Governmental Laws and Regulations Limit managerial discretion in hiring, promoting, and discharging employees. Affirmative Action: The requirement that organizations take proactive steps to ensure thefull participation of protected groups in its workforce.HRM Process:Human Resource (HR) Planning: The process by which managers ensure that they have the rightnumber and kinds of people in the right places, and at the right times, who are capable of effectivelyand efficiently performing their tasks.Human Resource planning is designed to ensure the future personnel needs will be constantly andappropriately met.
  4. 4. University of Wah Chapter 10 Managing Human ResourcesBS-CS-4th‘B’ Helps avoid sudden talent shortages and surpluses. Steps in HR planning:– Assessing current human resources– Assessing future needs for human resources– Developing a program to meet those future needsIt is accomplished through analysis of• Internal factors: Current and expected skill needs, vacancies and departmental expansions andreductions.• Environmental factors: Labor markets, use of computers to build and maintain informationabout employees.• Human resource planning must be integrated within the organizations strategic plans• Senior management must emphasize the importance of human resource planning• Human resource planning must be based on the most accurate information available.• A clear plan must be developed with associated time-spans and scope of activity.• Current Assessment:• Job analysis: Defines jobs and the behaviors to perform them i.e. Knowledge, skills, and abilities• Job description: A written statement of what a job holder does, how it’s done and why it is done.• Hiring specification: A statement of the minimum qualifications that a person must possess toperform a given job successfully.Recruitment & Decruitment:Recruitment: The development of a pool of job candidates in accordance with a human resource plan.It is the process of locating, identifying, and attracting capable applicants. Steps in the Recruitment process:• Internal Search• Advertisement of a job vacancy.• Web based advertising.
  5. 5. University of Wah Chapter 10 Managing Human ResourcesBS-CS-4th‘B’• Preliminary contact with potential job candidates.• Initial screening to create a pool of qualified applicants. Methods of Recruitment process:• External Recruitment• Internal RecruitmentDecruitment: Techniques for reducing the labor supply within an organization. E.g. firing, layoffs,transfers, retirements.Decruitment OptionsSelection: The process of screening job applicants to ensure that the most appropriate candidates arehired.What is Selection? An exercise in predicting which applicants, if hired, will be (or will not be) successfulin performing well on the criteria the organization uses to evaluate performance. Selection errors: Reject errors for potentially successful applicants Accept errors for ultimately poor performersSelection Decision Outcomes
  6. 6. University of Wah Chapter 10 Managing Human ResourcesBS-CS-4th‘B’Validity and Reliability:Validity ReliabilityThe proven relationship that existsbetween a selection device and somerelevant job criterion High tests scores equate to high jobperformance; low scores to poorperformance.The ability of a selection device tomeasure the same thing consistently Individual test scores obtained with aselection device are consistent overmultiple testing instances.Selection Criteria:• Testing: To measure the job and learning skills of the candidate.• Interviews: Although used almost universally, managers need to approach interviews carefully.• Initial Screening: A type of interview in which questions are asked about experience of thecandidate and his salary expectations.• Panel and Serial interviews: To evaluate a candidate for the job.• In Depth Selection Interviews: These interviews are conducted by the manager to whom theapplicant will report. The objective of this step is to find out more about applicant as an individual.• Background Checks: Selection committee confirms the truthfulness of application Résumé or of theapplication form. The previous supervisor of the applicant is called to confirm this information andto get his career highlights.• Physical Examination: It is conducted to ensure the physical fitness of applicant. Useful for physicalrequirements and for insurance purposes related to pre-existing conditions.Type of test tools:• Application Forms• Written Tests• Performance Simulations• Interviews• Background Investigations• Physical examinationsRealistic Job Preview (RJP): A preview of the job that provides both positive and negative informationabout the job and the company. Encourages mismatched applicants to withdraw. Aligns successful applicants’ expectations with actual job conditions; reducing turnover.
  7. 7. University of Wah Chapter 10 Managing Human ResourcesBS-CS-4th‘B’Providing Employees with Needed Skills And Knowledge:Orientation: Introduction of a new employee to his/her job and the organization.A program designed to help employees fit smoothly into an organization; also called socialization.Orientation or socialization is designed to provide new employees with the information needed tofunction comfortably and effectively in the organization.Work-unit orientation: Familiarizes new employee with work-unit goals Clarifies how his or her job contributes to unit goals Introduces he or she to his or her coworkersOrganization orientation: Informs new employee about the organization’s objectives, history, philosophy, procedures, andrules. Includes a tour of the entire facility.Employee Training: A process designed to maintain or improve current job performance.Types of Training:Type IncludesGeneralCommunication skills, computer systems application and programming, customerservice,Executive development, management skills and development, personal growth,sales,Supervisory skills, and technological skills and knowledgeSpecificBasic life/work skills, creativity, customer education,diversity/cultural awareness, remedial writing, managing change,leadership, product knowledge, public speaking/presentationskills, safety, ethics, sexual harassment, team building, wellness,and others
  8. 8. University of Wah Chapter 10 Managing Human ResourcesBS-CS-4th‘B’Employee Training Methods:Employee Performance Management:• Performance Management System: A process of establishing performance standards andappraising employee performance in order to arrive at objective HR decisions and toprovide documentation in support of those decisions.Performance Appraisal: A process of systematically evaluating performance and providingfeedback upon which performance adjustments can be made.Performance appraisal should be based on job analysis, job description, and job specifications.Advantages and Disadvantages of Performance Appraisal Methods:Method Advantage DisadvantageWritten essays Simple to use More a measure of evaluator’s writing ability thanof employee’s actual performance
  9. 9. University of Wah Chapter 10 Managing Human ResourcesBS-CS-4th‘B’Critical incidents Rich examples;behaviorally basedTime-consuming; lack quantificationGraphic rating scales Provide quantitativedata; less time-consuming thanothersDo not provide depth of job behavior assessedBARS Focus on specific andmeasurable jobbehaviorsTime-consuming; difficult to developMultiperson comparisons Compares employeeswith one anotherUnwieldy with large number of employees; legalconcernsMBO Focuses on end goals;results orientedTime-consuming360-degree appraisals 360 Thorough Time-consumingCompensation and Benefits:• Benefits of a Fair, Effective, and Appropriate Compensation System Helps attract and retain high-performance employees Impacts on the strategic performance of the firm• Types of Compensation Base wage or salary Wage and salary add-ons Incentive payments Skill-based pay: skill based pay systems reward employee for the job skills and competenciesthey demonstrates Variable pay system: In which an individual’s compensation is contingent on performance.
  10. 10. University of Wah Chapter 10 Managing Human ResourcesBS-CS-4th‘B’Factors That Influence Compensation and Benefits:Career Development:Career Defined: The sequence of positions held by a person during his or her lifetime. The Way It WasCareer DevelopmentProvided for information, assessment, and trainingHelped attract and retain highly talented people NowIndividuals—not the organization—are responsible for designing, guiding, and developing their owncareers. Boundary less Career A career in which individuals, not organizations, define career progression and organizationalloyalty.
  11. 11. University of Wah Chapter 10 Managing Human ResourcesBS-CS-4th‘B’Contemporary Issues in Managing Human resources:Managing Downsizing: The planned elimination of jobs in an organizationProvide open and honest communication.Provide assistance to employees being downsized.Reassure and counseling to surviving employees.Managing Work Force Diversity:Widen the recruitment net for diversityEnsure selection without discriminationProvide orientation and training that is effectiveTips for Managing Downsizing: Communicate openly and honestly:Inform those being let go as soon as possibleTell surviving employees the new goals and expectationsExplain impact of layoffs Follow any laws regulating severance pay or benefits Provide support/counseling for surviving employees Reassign roles according to individuals’ talents and backgrounds Focus on boosting morale:Offer individualized reassuranceContinue to communicate, especially one-on-oneRemain involved and available Have a plan for the empty office spaces/cubicles so it isn’t so depressing for surviving employees.