Human resource management refers to the practices and policies involved in acquiring, training, appraising, rewarding, and providing a safe work environment for employees. It includes conducting job analyses, planning staffing needs, recruiting and selecting candidates, training and developing employees, managing compensation and benefits, evaluating performance, and ensuring occupational health and safety. Both HR departments and line managers are responsible for HR functions. As the nature of work changes due to trends like globalization, new technologies, and a more diverse workforce, HR must help develop company strategies to build competitive advantage through distinctive employee skills, culture, and management systems.

1. Prentice Hall, © 2003
WHAT IS HUMAN RESOURCE
MANAGEMENT?
• Human resource (HR) management
refers to the practices and policies you
need to carry out the personnel aspects
of your management job, specifically,
acquiring, training, appraising,
rewarding, and providing a safe and fair
environment for your company’s
employees

2. Prentice Hall, © 2003
HUMAN RESOURCE MANAGEMENT
• Conducting job analyses
• Planning labor needs and recruiting job
candidates
• Selecting job candidates
• Orienting and training new employees
• Managing wages and salaries

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HUMAN RESOURCE MANAGEMENT
• Providing incentives and
benefits
• Appraising performance
• Training and developing
• Building employee
commitment

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Why Is HR Management Important to All
Managers?
• Hiring the wrong
person for the job
• Experiencing high
turnover
• Finding employees
not doing their best
• Having your company
taken to court because
of your discriminatory
actions
• Having your company
cited under federal
occupational safety
laws for unsafe
practices
Personnel mistakes you don’t want to make -

5. Prentice Hall, © 2003
Line Managers’ H R Responsibilities
• Placing the right person in the right job
• Starting new employees in the organization
• Training employees for jobs that are new to
them
• Interpreting the company’s policies and
procedures
• Controlling labor costs
• Protecting employees’ health and physical
conditions

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Human Resource Department’s
Management Responsibilities
• Compensation and
benefits
• Recruiting
• Training & development
• Employee relations
• Occupational safety and
health
• Job analysis

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HR’s Changing Environment
• Globalization refers to the tendency of
firms to extend their sales, ownership,
and/or manufacturing to new markets
abroad
• Technological Advances
• Nature of Work

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HR’s Changing Environment
• Growing emphasis
on “knowledge
workers” and human
capital.
• Human capital
refers to the
knowledge,
education, training,
skills, and expertise
of a firm’s workers

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HR’s Changing Environment
• Workforce demographics are
becoming more diverse as women,
minority-group members, and older
workers enter the workforce

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HR’S STRATEGIC CHALLENGES
• The central challenge
facing HR is to provide
a set of services that
make sense in terms of
the company’s strategy.
• A strategy is the
company’s plan for how
it will balance its internal
strengths and
weaknesses with
external opportunities
and threats in order to
maintain a competitive
advantage

11. Prentice Hall, © 2003
HR’S STRATEGIC CHALLENGES
• Most firms’
strategies
increasingly
stress building
organizational
competitiveness
and performance
• HR must be more
involved in
designing—not just
implementing—
companies’
strategies

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HR and competitive advantage
• Competitive advantage means “any
factors that allow an organization to
differentiate its product or service from
those of its competitors to increase
market share”

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HR as competitive advantage
• There is greater
recognition that
distinctive competencies
are obtained through
highly developed
employee skills,
distinctive organizational
cultures, management
processes, and systems.

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Strategic Human Resource Management
• The linking of HRM with strategic goals
and objectives in order to improve
business performance and develop
organizational cultures that foster
innovation and flexibility

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3 views of HRM
• HR activities involve “putting out fires”,
making sure employees are “paid on
time”
• Role is simply to “fit” and to help
execute the company’s strategy
• HR is an equal partner in the strategic
planning process

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HR’s Role in Formulating
Strategy
• HR participates in the strategy
formulation process by supplying
information regarding the company’s
internal human strengths and
weaknesses

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HR’s Role in Executing Strategy
• HR is heavily involved in the execution
of most firms’ downsizing and
restructuring strategies, through out-
placing employees, instituting pay-for-
performance plans, reducing health
care costs, and retraining employees.

18. Prentice Hall, © 2003
The Strategic Future of the HR
Department
Human resource departments will face
further downsizing and “reengineering,
as they face pressure from senior
management to add value to the
organization or have their functions
contracted out.”