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Hrm intro 2007
The document provides an overview of human resource management (HRM). It discusses the nature of management including different perspectives. It outlines the key HRM functions such as planning, organizing, staffing, leading, and controlling. It explains the line and staff aspects of HRM including the responsibilities of line managers. The document defines HRM and discusses its history. It describes the objectives of HRM from organizational, personal, and societal perspectives. Several HRM models are outlined including Fombrun, Tichy & Devanna, Harvard, David Guest, Warwick, and John Storey. The document provides a comprehensive introduction to the field of HRM.
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Hrm intro 2007
- 1.
- 2. The Nature ofManagementThe Nature of Management Management:Management: The science perspectiveThe science perspective The political perspectiveThe political perspective The control perspectiveThe control perspective The practice perspectiveThe practice perspective
- 3. The meaning of‘management’
- 4. Management ProcessesManagement Processes PlanningPlanning OrganizingOrganizing StaffingStaffing LeadingLeading ControllingControlling Why is HR important to all managers?Why is HR important to all managers?
- 5. Line and StaffAspects of HRMLine and Staff Aspects of HRM Line managerLine manager A manager who is authorized to direct theA manager who is authorized to direct the work of subordinates and is responsible forwork of subordinates and is responsible for accomplishing the organization’s tasksaccomplishing the organization’s tasks Staff managerStaff manager A manager who assists and advises lineA manager who assists and advises line managers.managers.
- 6. Line Managers’ HRMResponsibilitiesLine Managers’ HRM Responsibilities 1.1. Placing the right person on the right jobPlacing the right person on the right job 2.2. Starting new employees in the organization (orientation)Starting new employees in the organization (orientation) 3.3. Training employees for jobs that are new to themTraining employees for jobs that are new to them 4.4. Improving the job performance of each personImproving the job performance of each person 5.5. Gaining creative cooperation and developing smoothGaining creative cooperation and developing smooth working relationshipsworking relationships 6.6. Interpreting the firm’s policies and proceduresInterpreting the firm’s policies and procedures 7.7. Controlling labor costsControlling labor costs 8.8. Developing the abilities of each personDeveloping the abilities of each person 9.9. Creating and maintaining department moraleCreating and maintaining department morale 10.10. Protecting employees’ health and physical conditionProtecting employees’ health and physical condition
- 7. What is HRWhatis HR Human resources has two meanings dependingHuman resources has two meanings depending on the context:on the context: The original use comes from the politicalThe original use comes from the political economy and economics, where it is calledeconomy and economics, where it is called labourlabour, one of the three main factors of, one of the three main factors of production. (production. (land, labour & capitaland, labour & capita)) The more modern usage within companies andThe more modern usage within companies and businesses refers to individuals in thebusinesses refers to individuals in the company and the portion of the company'scompany and the portion of the company's organization that deals withorganization that deals with personnel orpersonnel or staffstaff recruitment , training, record keepingrecruitment , training, record keeping and other personnel issues.and other personnel issues.
- 8. Basic HR ConceptsBasicHR Concepts The bottom line ofThe bottom line of managing:managing: Getting resultsGetting results HRHR creates value bycreates value by engaging in activitiesengaging in activities thatthat produce the employeeproduce the employee behaviors that thebehaviors that the companycompany needs to achieveneeds to achieve its strategic goalsits strategic goals..
- 9. DefinitionDefinition The branchof organizational science thatThe branch of organizational science that deals with thedeals with the employment relationshipemployment relationship, along, along with all the decisions, actions, and issueswith all the decisions, actions, and issues involved in that relationship.involved in that relationship. A strategic approach to managing employmentA strategic approach to managing employment relations which emphasizes thatrelations which emphasizes that leveragingleveraging people’speople’s capabilitiescapabilities is critical to achievingis critical to achieving competitive advantage. This leveraging beingcompetitive advantage. This leveraging being achieved through a distinctive set ofachieved through a distinctive set of integratedintegrated employmentemployment policies, programs andpolicies, programs and practicespractices
- 10. THE FOCUS OFHRMTHE FOCUS OF HRM Businesses and organizations rely onBusinesses and organizations rely on three major resourcesthree major resources physical resources, such as materials and equipmentphysical resources, such as materials and equipment financial resources, including cash,financial resources, including cash, credit,credit, andand debt &debt & human resources or workers.human resources or workers. In its broadest sense, HRM refers to theIn its broadest sense, HRM refers to the management of all decisionsmanagement of all decisions within anwithin an organization that are related to people.organization that are related to people. In practice, however,In practice, however, HRM is a toolHRM is a tool used to try to make optimum use of human resources, toused to try to make optimum use of human resources, to foster individual development, and to comply with government mandates.foster individual development, and to comply with government mandates. Larger organizations typically have an HRM department and its primaryLarger organizations typically have an HRM department and its primary objective is making company goals compatible with employee goalsobjective is making company goals compatible with employee goals insofar as possible.insofar as possible. Hence, for a company to attain its goals, it must have employees who will help itHence, for a company to attain its goals, it must have employees who will help it Attain them.Attain them.
- 11. HistoryHistory Key principles &practices associated with HRM date back to the beginning ofKey principles & practices associated with HRM date back to the beginning of mankind.mankind. Mechanisms were developed for theMechanisms were developed for the selection of tribal leadersselection of tribal leaders, e.g: & knowledge, e.g: & knowledge was recorded and passed on to youth about safety, health, hunting, and gathering.was recorded and passed on to youth about safety, health, hunting, and gathering. More advanced HRM functions were developed as early as 1000 and 2000 BCMore advanced HRM functions were developed as early as 1000 and 2000 BC e.g.e.g. Employee screening testsEmployee screening tests have been traced back to 1115 B.C. in China.have been traced back to 1115 B.C. in China. And the earliest form of industrial education,And the earliest form of industrial education, the apprentice systemthe apprentice system, was started, was started in ancient Greek and Babylonian civilizations before gaining prominence duringin ancient Greek and Babylonian civilizations before gaining prominence during medieval times.medieval times. Since the inception of modem management theory, the terminology used toSince the inception of modem management theory, the terminology used to describe thedescribe the role and function of workersrole and function of workers has evolved fromhas evolved from "personnel" to"personnel" to "industrial relations" to "employee relations" to "human resources.""industrial relations" to "employee relations" to "human resources." While all of these terms remain in use,While all of these terms remain in use, "human resources""human resources" most accuratelymost accurately represents the view of workers byrepresents the view of workers by contemporary management theorycontemporary management theory : as: as valuablevaluable resources managed in the same manner as other valuable resourcesresources managed in the same manner as other valuable resources, according to, according to the authors ofthe authors of Human Resource Management.Human Resource Management.
- 12. Cont…..Cont….. The needfor an organized form of HRMThe need for an organized form of HRM emerged during theemerged during the industrial revolutionindustrial revolution,, as the manufacturing process evolvedas the manufacturing process evolved from a cottage system to factoryfrom a cottage system to factory production.production. As theAs the Economy shiftedEconomy shifted from anfrom an agricultural economy to an industrialagricultural economy to an industrial economy,economy, companies were forcedcompanies were forced toto develop and implement effective ways ofdevelop and implement effective ways of recruiting and keeping skilled workersrecruiting and keeping skilled workers..
- 13. Human ResourceHuman Resource ManagementManagement AttractandAttract and orient neworient new employeesemployees EffectiveEffective compensationcompensation systemssystems EffectiveEffective workwork environmentenvironment Compliance &Compliance & proceduresprocedures EffectiveEffective relationshipsrelationships HRM ActivitiesHRM Activities
- 14.
- 15. ObjectivesObjectives To createand utilize an able and motivated workforce, toTo create and utilize an able and motivated workforce, to accomplish the basic organizational goals.accomplish the basic organizational goals. To establish and maintain sound organizational structure andTo establish and maintain sound organizational structure and desirable working relationships among all the members of thedesirable working relationships among all the members of the organization.organization. To secure the integration of individual or groups within theTo secure the integration of individual or groups within the organization by coordination of the individual and group goalsorganization by coordination of the individual and group goals with those of the organization.with those of the organization. To create facilities and opportunities for individual or groupTo create facilities and opportunities for individual or group development so as to match it with the growth of thedevelopment so as to match it with the growth of the organization.organization. To attain an effective utilization of human resources in theTo attain an effective utilization of human resources in the achievement of organizational goals.achievement of organizational goals.
- 16. Cont…..Cont….. ToTo identifyand satisfy individual and group needsidentify and satisfy individual and group needs by providing adequateby providing adequate and equitable wages, incentives, employee benefits and social securityand equitable wages, incentives, employee benefits and social security and measures for challenging work, prestige, recognition, security,and measures for challenging work, prestige, recognition, security, status.status. ToTo maintain high employees moralemaintain high employees morale and sound human relations byand sound human relations by sustaining and improving the various conditions and facilities.sustaining and improving the various conditions and facilities. ToTo strengthen and appreciate the human assets continuouslystrengthen and appreciate the human assets continuously byby providing training and development programs.providing training and development programs. ToTo consider and contribute to the minimization of socio-economic evilsconsider and contribute to the minimization of socio-economic evils such as unemployment, under-employment, inequalities in thesuch as unemployment, under-employment, inequalities in the distribution of income and wealth and to improve the welfare of thedistribution of income and wealth and to improve the welfare of the society by providing employment opportunities to women andsociety by providing employment opportunities to women and disadvantaged sections of the society.disadvantaged sections of the society. To provide an opportunity forTo provide an opportunity for expression and voice managementexpression and voice management.. To provideTo provide fair, acceptable and efficient leadership.fair, acceptable and efficient leadership. To provideTo provide facilities and conditions of workfacilities and conditions of work and creation of favorableand creation of favorable atmosphere for maintaining stability of employment.atmosphere for maintaining stability of employment.
- 17.
- 18. HRM Objectives &FunctionsHRM Objectives & Functions 1.Legal Compliance1.Legal Compliance 2.Benefits2.Benefits 3. Union-management relations3. Union-management relationsSocietal objectives Organizational ObjectivesOrganizational Objectives 1. Human Resource Planning 2. Employee Relation 3. Selection 4. Training & Development 5. Appraisal Functional Objectives 1. Appraisal 2. Placement 3. Assessment Personal Objective 1. Training & Development 2. Appraisal 3. Placement 4. Compensation 5. Assessment
- 19.
- 20. The system ofbasic HRM PracticesThe system of basic HRM Practices Selection Job Design Specification Performance Appraisal Rewards Development HR planning HR marketing & Employer Branding Recruitment Formal & informal coaching and training Career planning & development Succession planning Evaluation & Feedback & Objective setting Outplacement Promotion Work / Life Balance
- 21. Models of HRModelsof HR The management of most important resources –The management of most important resources – the peoplethe people is of utmost importanceis of utmost importance.. Until about the 1970s the task of ‘Until about the 1970s the task of ‘finding and controllingfinding and controlling peoplepeople’ was handled by Personnel Management which was’ was handled by Personnel Management which was largely anlargely an administrativeadministrative function, dealing with thefunction, dealing with the management and control of subordinatesmanagement and control of subordinates The concept of Human Resource Management developedThe concept of Human Resource Management developed with a morewith a more strategic level of thinkingstrategic level of thinking about the nature andabout the nature and role of people (as total 24hr per day human beings) workingrole of people (as total 24hr per day human beings) working inin organizations which are ‘culturesorganizations which are ‘cultures’ in their own right.’ in their own right.
- 22. HRM ModelsHRM Models Recentthinking has moved from theRecent thinking has moved from the control-based modelcontrol-based model to theto the compliance modelcompliance model.. The soft edge of the latter involvesThe soft edge of the latter involves improving employee commitmentimproving employee commitment andand expecting effectiveness and efficiency to follow.expecting effectiveness and efficiency to follow. The hard edge of the latter involves ridding the organization ofThe hard edge of the latter involves ridding the organization of unnecessary layers of middle management which, when stripped of controlunnecessary layers of middle management which, when stripped of control functions, have very little by way of value added.functions, have very little by way of value added. The management task is to cause the people to beThe management task is to cause the people to be as creative and productive as possible.as creative and productive as possible.
- 25. Theoretical perspectives onHRMTheoretical perspectives on HRM Key areas of most models of HRM include: HR Planning and staffing (including recruitment and selection) Developing staff Rewarding and motivating staff Staff welfare (including health and safety) Employment relations – managing conflicts Managing change – response to competition, new technology, laws Evaluate contribution of HRM
- 26. Some ModelsSome Models Fombrun, Tichy & Devanna Model Harvard ModelHarvard Model David Guest ModelDavid Guest Model The Warwick ModelThe Warwick Model John Storey ModelJohn Storey Model
- 27. Fombrun, Tichy &DevannaFombrun, Tichy & Devanna
- 28. Fombrun, Tichy &Devanna
- 29. Fombrun, Tichy &DevannaFombrun, Tichy & Devanna This is a fairly basic model but identifies Four important and interlinked activities of HRM But does not really provide much detail as to how these things are or should be done
- 30. HarvardHarvard Six elements identified Situation – workforce, management philosophies, labour market contexts, legal and social regulations, social values Stakeholders – various interests surrounding the organization
- 31. The Harvard SystemTheHarvard System Integrated modelIntegrated model Analytical - commonly usedAnalytical - commonly used Policy choices influenced by interestPolicy choices influenced by interest groups and situational factorsgroups and situational factors A prescriptive element - theA prescriptive element - the outcomesoutcomes Identifies limited preferred /Identifies limited preferred / superior choices?superior choices? Perhaps one way communication?Perhaps one way communication?
- 32. Harvard model HRMHarvardmodel HRM
- 33. Consequences Individual –pay, rewards, identity, well being Organizational – effectiveness, efficiency, profits Societal - employment, economic growth, prosperity Feedback – evaluation and appropriate adjustment to policies and practices
- 34. David Guest ModelDavidGuest Model Basic argument is that integrated HR practices can lead to improved individual and organizational performance HRM is distinctive from old style personnel management because: It is more tightly or closely integrated into the organization's business strategy, not an add on. It seeks to achieve behavioural commitment of employees, not just compliance Its emphasizes a unitary or common interest between employers and employees in working towards organizational success rather than recognizing differing interests & Conflicts
- 35. It emphasisesindividual contribution and efforts and links these to rewards, rather than managing people in standard ways as a group Business strategy is important because it has implications for HR strategy and practices Outcomes of HR are : high commitment high quality flexibility
- 36.
- 37. The Warwick ModelTheWarwick Model More analytical approach than Harvard - noMore analytical approach than Harvard - no perscriptive elementsperscriptive elements External influences are recognised in theExternal influences are recognised in the context of HR strategycontext of HR strategy Two way system of communication -Two way system of communication - dialogue modeldialogue model Recognises the role of personnel function inRecognises the role of personnel function in HR strategyHR strategy
- 38. John Storey ModelJohnStorey Model Demonstrates the differences betweenDemonstrates the differences between the ‘personnel and industrials’ and thethe ‘personnel and industrials’ and the HRM paradigm by creating an ‘ideal’HRM paradigm by creating an ‘ideal’ type.type. Characterizes HRM as ‘anCharacterizes HRM as ‘an amalgamamalgam ofof description, prescription, and logicaldescription, prescription, and logical deduction’.deduction’.
- 39.
- 40.
- 41. Example:Example: HR BusinessModelHR Business Model (Bank of Baroda)(Bank of Baroda)
- 42. TheThe Strategic HRBusiness ModelStrategic HR Business Model adopted byadopted by Bank of Baroda incorporates itsBank of Baroda incorporates its HR Mission andHR Mission and PhilosophyPhilosophy and is focused towardsand is focused towards attainmentattainment of long-term organizational goals.of long-term organizational goals. A very strongA very strong Organizational LeadershipOrganizational Leadership atat different levels forms the key link in the Model.different levels forms the key link in the Model. These are:These are: Strategic Leadership - Corporate levelStrategic Leadership - Corporate level Business Leadership - Zonal & Regional levelBusiness Leadership - Zonal & Regional level Operational Leadership - Business unit level i.e.Operational Leadership - Business unit level i.e. branchbranch
- 43. The two vitalHuman Resource sub-systems i.e.The two vital Human Resource sub-systems i.e. HR Planning & Management Sub-System &HR Planning & Management Sub-System & Competency Based HRD Sub-SystemCompetency Based HRD Sub-System shape the very crucialshape the very crucial Performance EnvironmentPerformance Environment within the Bankwithin the Bank whichwhich facilitates development of enabling capabilities of people.facilitates development of enabling capabilities of people. Through proper developmental inputs,Through proper developmental inputs, Positive AttitudePositive Attitude && Right MindsetRight Mindset is created among people.is created among people. Through properThrough proper Communication Medium and an Organizational CultureCommunication Medium and an Organizational Culture of sharing, openness, collaboration & confrontation, autonomyof sharing, openness, collaboration & confrontation, autonomy etc., people in the organization are facilitated to give theiretc., people in the organization are facilitated to give their best output (performance).best output (performance).
- 44. The Model isadequately supported by a suitableThe Model is adequately supported by a suitable Learning PlatformLearning Platform, which imparts proper, which imparts proper KnowledgeKnowledge and enhancesand enhances LearningLearning among peopleamong people (functional, behavioural etc) so that their(functional, behavioural etc) so that their CompetenceCompetence increases and their potential couldincreases and their potential could be properly leveraged forbe properly leveraged for greatergreater IndividualIndividual And Organizational EffectivenessAnd Organizational Effectiveness.. These create properThese create proper Employee MotivationEmployee Motivation,, which ultimately facilitateswhich ultimately facilitates Goal AchievementGoal Achievement..
- 45. Assumptions about HRMAssumptionsabout HRM R. Wayne Pace, writing inR. Wayne Pace, writing in Human Resource Development,Human Resource Development, identifies sevenidentifies seven underlying assumptions that provide a foundation and direction for HRM.underlying assumptions that provide a foundation and direction for HRM. First is theFirst is the acknowledgment of individual worthacknowledgment of individual worth, suggesting that companies recognize, suggesting that companies recognize and value individual contributions.and value individual contributions. Second is thatSecond is that employees are resources who can learn new skills and ideasemployees are resources who can learn new skills and ideas and can beand can be trained to occupy new positions in the organization.trained to occupy new positions in the organization. Third is thatThird is that quality of work lifequality of work life is a legitimate concern, and that employees have ais a legitimate concern, and that employees have a right to safe, clean, and pleasant surroundings.right to safe, clean, and pleasant surroundings. Fourth assumption is theFourth assumption is the need for continuous learningneed for continuous learning; talents and skills must be; talents and skills must be continually refined in the long-term interests of the organization.continually refined in the long-term interests of the organization. Fifth assumption supporting the existence of an organized HRM within a company orFifth assumption supporting the existence of an organized HRM within a company or institution is thatinstitution is that opportunities are constantly changingopportunities are constantly changing and companies need methodsand companies need methods to facilitate continual worker adaptation.to facilitate continual worker adaptation. Sixth isSixth is employee satisfactionemployee satisfaction, which implies that humans have a right to be satisfied, which implies that humans have a right to be satisfied by their work and that employers have a responsibility and profit motivation to try toby their work and that employers have a responsibility and profit motivation to try to match a worker's skills with his or her job.match a worker's skills with his or her job. Seventh and final assumption is that HRM encompasses a much broader scope thanSeventh and final assumption is that HRM encompasses a much broader scope than technical training—employeestechnical training—employees need to know more than the requirements of a specificneed to know more than the requirements of a specific tasktask in order to make their maximum contribution.in order to make their maximum contribution.
- 46. THE ROLE, POSITION,AND STRUCTURETHE ROLE, POSITION, AND STRUCTURE OF HRM DEPARTMENTSOF HRM DEPARTMENTS InIn Personnel Management,Personnel Management, Paul S. Greenlaw and John P. Kohl describe threePaul S. Greenlaw and John P. Kohl describe three distinct,distinct, interrelated fields of interestinterrelated fields of interest addressed by the HRM discipline:addressed by the HRM discipline: human relations,human relations, organization theory,organization theory, andand decision areas.decision areas. .. .. .. Human relationsHuman relations individual motivation,individual motivation, leadership,leadership, & group relationships& group relationships Organization theoryOrganization theory job design,job design, managerial control &managerial control & work flowwork flow through the organizationthrough the organization Decision areasDecision areas interests related tointerests related to acquisition, development,acquisition, development, Compensation &Compensation & maintenance ofmaintenance of human resourceshuman resources HRM
- 48. Structure of HRMdepartmentsStructure of HRM departments The departments differ according to theThe departments differ according to the type and sizetype and size of the organizationof the organization that they serve.that they serve. But many large organizations (including governments, institutions,But many large organizations (including governments, institutions, manufacturing companies, and service firms) organize HRM employeemanufacturing companies, and service firms) organize HRM employee development functions around various clusters of workers—theydevelopment functions around various clusters of workers—they conductconduct recruiting, administrative, and other duties in arecruiting, administrative, and other duties in a central locationcentral location.. Different employee development groupsDifferent employee development groups for each department arefor each department are necessary to train and develop employees innecessary to train and develop employees in specializedspecialized areas, such asareas, such as sales, engineering, marketing, or executive education.sales, engineering, marketing, or executive education. In contrast, someIn contrast, some HRM departments are completely independentHRM departments are completely independent and areand are organized purely by function. The same training department, for example,organized purely by function. The same training department, for example, serves all divisions of the organization.serves all divisions of the organization.
- 49. HRM department responsibilitiesHRMdepartment responsibilities Individual managementIndividual management This entailsThis entails helping employees identify their strengths andhelping employees identify their strengths and weaknessesweaknesses, correct their shortcomings, and then make their best, correct their shortcomings, and then make their best contribution to the enterprise. These duties are carried outcontribution to the enterprise. These duties are carried out through a variety of activities such as performance reviews,through a variety of activities such as performance reviews, training, and testing.training, and testing. Organizational developmentOrganizational development This focuses on fosteringThis focuses on fostering a successful systema successful system that maximizesthat maximizes human, and other, resources. This important duty also includes thehuman, and other, resources. This important duty also includes the creation and maintenance of a change program, which allows thecreation and maintenance of a change program, which allows the organizationorganization to respond to evolving outside and internal influencesto respond to evolving outside and internal influences.. Career AreasCareer Areas The third responsibility,The third responsibility, career developmentcareer development, involves matching, involves matching individuals with the most suitable jobs and career paths.individuals with the most suitable jobs and career paths.
- 50. Positioning of HRMDepartmentsPositioning of HRM Departments In larger organizations the HRM function might be headed by aIn larger organizations the HRM function might be headed by a vice president,vice president, while smaller entities will have a middle-level managerwhile smaller entities will have a middle-level manager as head of HRM.as head of HRM. In any case, because the HRM department is charged with managingIn any case, because the HRM department is charged with managing thethe productivity and development of workers at all levelsproductivity and development of workers at all levels, the top, the top HRM manager ideally has access to, and the support of, key decisionHRM manager ideally has access to, and the support of, key decision makers.makers. In addition, the HRM department should be situated in such a wayIn addition, the HRM department should be situated in such a way thatthat it has horizontal accessit has horizontal access, or, or is able to communicate effectivelyis able to communicate effectively with all divisions within the company.with all divisions within the company. Horizontal access allows HRMHorizontal access allows HRM to integrate, educate, and train theto integrate, educate, and train the workforceworkforce, and, and to facilitate changesto facilitate changes that affect one division andthat affect one division and indirectly influence other segments of the company or institution.indirectly influence other segments of the company or institution.
- 51. HRM IMPLEMENTATION ACTIVITIESHRMIMPLEMENTATION ACTIVITIES To fulfill their basic role and achieve their goals,To fulfill their basic role and achieve their goals, HRM professionals and departments engage in aHRM professionals and departments engage in a variety of activities in order to execute theirvariety of activities in order to execute their human resource plans.human resource plans. HRM implementation activities fall intoHRM implementation activities fall into fourfour functional groups, each of which includesfunctional groups, each of which includes related legal responsibilities:related legal responsibilities: acquisition,acquisition, development,development, compensation, andcompensation, and maintenance.maintenance.
- 52. Today’s Workforce Realities:Today’sWorkforce Realities: A Pressure Cooker about to Blow?A Pressure Cooker about to Blow? Decade of boom & bust leaves working families withDecade of boom & bust leaves working families with:: Stagnant, declining incomesStagnant, declining incomes Increased inequalityIncreased inequality Longer working hoursLonger working hours Less retirement savings; fewer health care benefitsLess retirement savings; fewer health care benefits Broader job insecurityBroader job insecurity Loss of worker voice in societyLoss of worker voice in society Current government policies producing:Current government policies producing: Further cuts in services & jobsFurther cuts in services & jobs Tax policies that further increase inequalityTax policies that further increase inequality Deep divisions over war policiesDeep divisions over war policies Direct attacks on workers, unions, and core valuesDirect attacks on workers, unions, and core values
- 53. FORCES CHANGING HRMFORCESCHANGING HRM Information technologyInformation technology—brought about the—brought about the decentralization of communicationsdecentralization of communications and theand the shake-up of existing paradigms of human interaction and organizational theory. Satelliteshake-up of existing paradigms of human interaction and organizational theory. Satellite communications,communications, computerscomputers and networking systems, fax machines, and other devicesand networking systems, fax machines, and other devices were facilitating rapid changewere facilitating rapid change Decentralized management systems-Decentralized management systems---(scrapping traditional, hierarchical organizational--(scrapping traditional, hierarchical organizational structures)structures) teamteam approach to managementapproach to management GlobalizationGlobalization------To compete abroad, companies were looking to their HRM professionalsTo compete abroad, companies were looking to their HRM professionals to augment initiatives related to quality, productivity, and innovationto augment initiatives related to quality, productivity, and innovation Cultural changesCultural changes Concern for employee rightsConcern for employee rights Changing attitude towards workChanging attitude towards work Balancing work and familyBalancing work and family Demographic (population related) and Employee concernsDemographic (population related) and Employee concerns Demographic changesDemographic changes Diversity of backgroundsDiversity of backgrounds Age distributionsAge distributions Gender distributionGender distribution Rising level of educationRising level of education
- 54. Meeting the challengeMeetingthe challenge Critical Issues & OpportunitiesCritical Issues & Opportunities Building Knowledge Based OrganizationsBuilding Knowledge Based Organizations Knowledge WorkersKnowledge Workers Knowledge Based Work SystemsKnowledge Based Work Systems The Dual Agenda: Work & Family OutcomesThe Dual Agenda: Work & Family Outcomes Building/Sustaining Productive Labor ManagementBuilding/Sustaining Productive Labor Management PartnershipsPartnerships How to Get ThereHow to Get There Rebuilding External AlliancesRebuilding External Alliances Becoming More AnalyticalBecoming More Analytical Rebuilding Trust through Openness & TransparencyRebuilding Trust through Openness & Transparency
- 56. Steps in StrategicHRMSteps in Strategic HRM EnvironmentalEnvironmental AnalysisAnalysis EnvironmentalEnvironmental AnalysisAnalysis OrganizationalOrganizational Mission &Mission & GoalsGoals AnalysisAnalysis OrganizationalOrganizational Mission &Mission & GoalsGoals AnalysisAnalysis Analysis ofAnalysis of OrganizationalOrganizational Strengths &Strengths & CultureCulture Analysis ofAnalysis of OrganizationalOrganizational Strengths &Strengths & CultureCulture Analysis ofAnalysis of OrganizationalOrganizational StrategiesStrategies Analysis ofAnalysis of OrganizationalOrganizational StrategiesStrategies Choice &Choice & ImplementationImplementation Of HROf HR StrategiesStrategies Choice &Choice & ImplementationImplementation Of HROf HR StrategiesStrategies Review &Review & EvaluationEvaluation of HRof HR StrategiesStrategies Review &Review & EvaluationEvaluation of HRof HR StrategiesStrategies
- 58. Changes… leads to….Changes…leads to…. More consumer choiceMore consumer choice Merger and acquisitionsMerger and acquisitions Joint venturesJoint ventures More complexityMore complexity Short product life cyclesShort product life cycles Market fragmentationMarket fragmentation More uncertainty for managersMore uncertainty for managers Record number of business failuresRecord number of business failures
- 59. So.. The companiesmust be…So.. The companies must be… FAST, RESPONSIVE, COST-EFFECTIVEFAST, RESPONSIVE, COST-EFFECTIVE:: *Flat organization *Downsized*Flat organization *Downsized *Quality-conscious *Empowered*Quality-conscious *Empowered *Smaller units *Decentralized*Smaller units *Decentralized *Human-capital oriented *Boundary less*Human-capital oriented *Boundary less *Values- and vision-oriented *Team-based*Values- and vision-oriented *Team-based
- 60. HRM-Indian ContextHRM-Indian Context InnovativeHRM practices are being adopted by Indian firms to brace competition in the post liberalization scenario: HRM plays a vital role in crafting creative business strategies HRM plays a critical role during organizational restructuring Adoption of innovative HRM practices in creating social networks HRM's role in strategy formulation Innovative HRM invokes new challenges, new skills, new programs and new technologies Innovative HRM shifts from an uni-dimesional to a multi-dimensional approach Effective HRM and strong leadership can enable Indian companies to go global Innovative HRM practices can help the company to break away from traditional shackles Innovative and proactive HRM can lead to superior performance
- 62. HRM –Global ContextHRM–Global Context HR and the Internationalization of businessHR and the Internationalization of business The HR Challenges of international businessThe HR Challenges of international business How inter country differences influence HRMHow inter country differences influence HRM Cultural factorsCultural factors Economic systemsEconomic systems Legal and industrial relations factorsLegal and industrial relations factors
- 63. A Case StudyACase Study Dell’s dual HR roles Deals with staff - benefits - compensation - call center Deals with management - education - recruitment - planning - training - personnel needs OPERATIONS MANAGEMENT
- 64. GlobalizationGlobalization 0 10 20 30 40 50 60 70 80 1920 1950 19702000 % fortune 500 with a global presence
- 65. Consequences of thesebasic trendsConsequences of these basic trends Technology Global expansion Strengths and Weaknesses Uncertainty, Turbulence, Rapid Change, Changing power bases Companies must be Fast, Responsive, and Cost- effective Improved competition
- 66. HR’s evolving roleHR’sevolving role Protector and Screener Strategic Partner Change Agent
- 67. Technology can bethe Human ResourcesTechnology can be the Human Resources engine of changeengine of change
- 68. HR and technologyHRand technology Basic HR systems demand paperworkBasic HR systems demand paperwork 70% of HR’s employees time = paperwork70% of HR’s employees time = paperwork Off the shelf forms from Office Depot/OfficemaxOff the shelf forms from Office Depot/Officemax Online formsOnline forms Human Resource Information Systems (HRIS)Human Resource Information Systems (HRIS) HR on the InternetHR on the Internet
- 69. HR portalsHR portals Employeescan answer their own questions HR moves from reactive to proactive
- 70. HR means performanceHRmeans performance Can HR have a measurableCan HR have a measurable impact on a company’simpact on a company’s bottom line?bottom line? Better HRM translates intoBetter HRM translates into improved employeeimproved employee attitudes and motivationattitudes and motivation (e.g., working at home)(e.g., working at home) Well run HR programs driveWell run HR programs drive employee commitmentemployee commitment TOYOTA
- 71. Things to Rememberas We Move intoThings to Remember as We Move into Chapter 2Chapter 2 HR management: theHR management: the responsibility ofresponsibility of everyevery managermanager HR practices today mustHR practices today must address several basic issuesaddress several basic issues includingincluding Improving competitivenessImproving competitiveness GlobalizingGlobalizing Technology and internet-basedTechnology and internet-based advancesadvances Contributing to strategic successContributing to strategic success
Editor's Notes
- #64 From its start in Michael Dell’s college dorm room, Dell Computer’s competitive strategy was always to be the PC industry’s low-cost leader. While others like Apple competed based on differentiating features like multimedia software, Dell stripped away the retailers’ profit and drove its costs down by selling direct and relentlessly slashing costs. That’s why it was,and is, the industry’s low-cost leader. Dell’s HR managers have found a variety of other, ongoing ways to help Dell’s top management execute the firm’s low-cost leader strategy. For one thing—and as you might imagine—Dell now delivers most of its HR services via the Web.
- #65 Globalization of markets is perhaps the most obvious: Sony, Calvin Klein, The Gap, Nike, and Mercedes-Benz are some of the firms that market all over the world. Firms are globalizing their production, too, by putting facilities where they’ll be most advantageous. Toyota produces its Camry in Georgetown, Kentucky, with almost 80% U.S.-made parts, for instance. And with globalized markets and production, globalized ownership increasingly makes more sense: Four out of five “American” textbook publishers, for example—Prentice Hall, Harcourt, Houghton Mifflin, and Wiley—are owned by firms outside America (Britain’s Pearson owns Prentice Hall). ASK STUDENTS: What other solutions could a small operation engage in to keep costs down yet compete overseas as in the video? Answers will vary but having a serious discussion with their representative in London could help keep expenses down. Also, they should investigate the amount of revenue this person is generating against his expenses. Perhaps it is worth the investment. Also, they could tie part of his compensation to more effective cost management.
- #66 Managers have to craft strategies that balance opportunities and threats like those above with their firm’s strengths and weaknesses, and this has produced the strategies and organizational changes with which you’re already probably familiar. Improved competitiveness is another popular strategy, one aimed at buttressing the firm’s strengths and reducing its weaknesses. This strategy manifests itself in many ways: in downsizing, to boost productivity; in mergers, to achieve increased size while stripping redundant costs; in programs aimed at continuously improving operations; and in using the Web. Global expansion and improved competitiveness are in turn driving other, organizational changes. Rather than pyramidal chains with 9 or 10 levels, firms are flat; self-directed teams of empowered employees, close to the customers, now make decisions that once had to be shifted up for managerial review. Boundaryless decision making means employees interact freely across departmental and level boundaries to get the information and decisions they need quickly. The bases of power are also therefore changing. Human capital The knowledge, education,training, skills, and expertise of a firm’s workers are critical to speed, responsiveness and cost-effectiveness.
- #67 Today, HR’s role is shifting from protector and screener to strategic partner and change agent. The metamorphosis of “personnel” into “human resource management” reflects that. In today’s flattened, downsized, and high-performing organizations, trained and committed employees—not machines—are the firm’s competitive key.
- #68 Indeed, technology can be an engine of strategic change. At IBM, for instance, creating a centralized HR call center did more than save the company $180 million.
- #69 Basic HR Systems HR can be an enormously paper-intensive process. For example, just recruiting and hiring an employee might require a Notice of Available Position, a help wanted advertising listing, an employment application, an interviewing checklist, and a telephone reference checklist. You then need an employment agreement, a confidentiality and non-compete agreement, and a hiring authorization form and employee background verification. To keep track of the employee once he or she is on board, you’d need—just to start—an employee change form, personnel data sheet, and daily or weekly time records. Then come the performance appraisal forms, notice of probation, and dozens of other, similar forms—and this list doesn’t even scratch the surface. Where do forms and systems like these come from? For a start-up business, office supply stores such as Office Depot and OfficeMax sell paper-and-pencil forms. Instructor’s Note: The IHRIM link shown on the slide takes you to a white paper that discusses how online benefits enrollment provides substantial savings to employers. Human Resource Information Systems (HRIS) As companies grow, they integrate their separate HR systems into human resource information systems (HRIS). An HRIS is “interrelated components working together to collect, process, store, and disseminate information to support decision-making, coordination, control, analysis, and visualization of an organization’s human resource management activities.” HR and the Internet The Internet triggered a revolution in what HR departments do and how they do it. First, the Internet enabled any HR department to shift some activities to specialized online HR service providers. Yet, while turning to specific online services like these is beneficial, it’s the movement to HR portals that prompted the most striking changes in what HR does and how it does it. Instructor’s Note: Click on the HR.net link above or just go to www.hr.net and click on log in without using a password or user name. This will take you to a sample listing of jobs.
- #70 The HR Portal HR portals, usually hosted on a company’s intranet, provide employees with a single access point or “gateway” to all HR information. They let the firm’s employees, managers, and executives interactively (and selectively) access and modify HR information. They thereby streamline the HR process and enable HR managers to focus more on strategic issues. Instructor’s Note: Click on the link to take you to the home page of a company that provides such a service.
- #71 Improvements in key HR practices correlate with an increase in a companies market value. It is one thing to argue that HR can help create competitive advantage; the real question is: “Can HR have a measurable impact on a company’s bottom line?” There is evidence that the answer is yes. A study by HR consulting firm Watson Wyatt Worldwide of Bethesda, Maryland, found that significant improvements in key HR management practices correlated with significant increases in market value in the 405 publicly traded firms studied. Employee behavior (and therefore HR) is especially important in service firmslike banks and retail stores. Many firms today know they need employees to work “as if they own the company.” At Toyota Motor Manufacturing in Georgetown, Kentucky, employee commitment helps explain the firm’s superior performance and product quality. Toyota instituted an HR system that cultivates commitment. For example, Toyota has programs that guarantee fair treatment of employees’ grievances and disciplinary concerns. It also has programs that help ensure employees can use all their skills and gifts at work, such as career-oriented performance appraisal procedures and extensive training and development opportunities. Commitment: An employee’s identification with and agreement to pursue the company’s or the unit’s mission. Instructor’s Notes: Click on the Watson Wyatt link for a paper on the study. Click on the photo for ITAC (International Telework Association and Council) for a description of telework essentials. The Toyota link will take you to an area that allows you to discuss what it is like working at Toyota.
- #72 For current and future managers, the best advice seems to be to learn as much as possible about the HR practices we’ll discuss in the following chapters, and then design a practice that’s consistent with what your company wants to achieve. The corollary is that flexibility is advisable: You may have to modify an HR practice (such as a compensation plan) as competitive conditions cause you to modify your firm’s business strategy. You’ll therefore find an emphasis on practical material that you as a manager will need to carry out your day-to-day management responsibilities. HR practices today must address several basic issues, including improving competitiveness, globalizing the firm’s operations, implementing technological and Internet-based advances, and contributing to the firm’s strategic success.