Human Resource Management

Management- Semester 1

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LEARNING OUTLINE • What is Human Resources Management (HRM) and why HR Is Important

•The Human Resources Management Process

•Human Resources Planning

•Staffing the Organization

•Orientation and Skill Development

•Managing and Rewarding Performance

•Compensation and Benefits

•Career Development

•Current Issues in Human Resources Management

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What is Human Resource Management

(HRM)? • HRM is the set of organizational activities directed at attracting, developing and maintaining an effective workforce. (Griffin, R.W 5th Edition)

•HRM takes place with in complex and ever changing environment.

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The Importance of Human Resources Management (HRM)• Necessary part of the organizing function of

management– Selecting, training, and evaluating the workforce

• An important strategic tool– HRM helps establish an organization’s sustainable

competitive advantage.

• Adds value to the firm– High performance work practices lead to both high

individual and high organizational performance.

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Exhibit 11.1 Examples of High-Performance Work Practices

• Self-directed work teams

• Job rotation

• High levels of skills training

• Problem-solving groups

• Total quality management procedures and processes

• Encouragement of innovative and creative behaviour

• Extensive employee involvement and training

• Implementation of employee suggestions

• Contingent pay based on performance

• Coaching and mentoring• Significant amounts of

information sharing• Use of employee attitude

surveys• Cross-functional integration• Comprehensive employee

recruitment and selection procedures

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Human Resources for Non-HR Managers

• Small vs. large organizations– Large organizations have HR function.– Smaller organizations may rely on managers

to handle HR issues.

• All managers need to be aware of federal and provincial legislation and company policies.

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The HRM Process

• Functions of the HRM Process– Identifying and selecting competent

employees – Providing employees with up-to-date

knowledge and skills to do their jobs– Ensuring that the organization retains

competent and high-performing employees

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Exhibit 11.2 The Human Resources Management Process

Environment

Environment

Decruitment

Recruitment

Human

Resource

Planning

Selection

Orientation Training

Performance

Management

Career

Development

Compensation

and

Benefits

Identification and Selection

of Competent Employees

Adapted and competent

employees with up-to-date

skills and knowledge

Competent and high-performing employees who

are capable of sustaining high performance over

the long term

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Environmental Factors Affecting HRM

• Labour Union– An organization that represents workers and

seeks to protect their interests through collective bargaining

• Collective Bargaining Agreement– A contractual agreement between an

organization and a union, covering:• Wage, hours, and working conditions

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Environmental Factors Affecting HRM (cont’d)

• Legislation Affecting Workplace Conditions– Canada Labour Code– Occupational Health and Safety Act– Workplace Hazardous Materials Information

System (WHMIS)– Employment standards legislation

• Antidiscrimination Legislation– The Charter of Rights and Freedoms and the

Canadian Human Rights Act – The Employment Equity Act

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Managing Human Resources

• Human Resources (HR) Planning– The process by which managers ensure that they

have the right number and kinds of people in the right places, and at the right times, who are capable of effectively and efficiently performing their tasks

– Helps avoid sudden talent shortages and surpluses– Steps in HR planning:

• Assessing current human resources

• Assessing future needs for human resources and developing a program to meet those future needs

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Current Assessment

• Human Resources Inventory– A review of the current makeup of the

organization’s resources status– HR Management Information Systems (HRMIS)

• Tracks employee information for policy and strategic needs

– Job analysis• An assessment that defines a job and the behaviours

necessary to perform the job:– Knowledge, skills, and abilities

• Requires conducting interviews, engaging in direct observation, and collecting the self-reports of employees and their managers

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Current Assessment (cont’d)

• Job Description– A written statement of what the jobholder

does, how it is done, and why it is done

• Job Specification– A written statement of the minimum

qualifications that a person must possess to perform a given job successfully

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Exhibit 11.3 Meeting Future Human Resources Needs

Supply of Employees Demand for Employees

Factors Affecting Staffing

Strategic Goals

Forecast demand for products and services

Availability of knowledge, skills, and abilities

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Staffing the Organization

• Recruitment– The process of locating, identifying, and

attracting capable applicants to an organization

• E-recruiting– Recruitment of employees through the Internet

• Organizational web sites• Online recruiters

• Decruitment– The process of reducing a surplus of

employees in the workforce of an organization

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Exhibit 11.4 Major Sources of Potential Job Candidates

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Exhibit 11.5 Decruitment Options

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Selection

• Selection Process– The process of screening job applicants to ensure

that the most appropriate candidates are hired

• Selection– An exercise in predicting which applicants, if hired,

will be (or will not be) successful in performing well on the criteria the organization uses to evaluate performance

– Selection errors:• Reject errors for potentially successful applicants• Accept errors for ultimately poor performers

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Exhibit 11.6 Selection Decision Outcomes

Correctdecision

Accepterror

Correctdecision

Rejecterror

Selection Decision

Accept Reject

Late

r Jo

b P

erf

orm

ance

Unsu

ccess

ful

Succ

ess

ful

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Validity and Reliability

• Validity (of Prediction)– A proven relationship between the selection device

used and some relevant criterion for successful performance in an organization

• High test scores equate to high job performance; low scores to poor performance

• Reliability (of Prediction)– The degree of consistency with which a selection

device measures the same thing• Individual test scores obtained with a selection device

are consistent over multiple testing instances

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Types of Selection Devices

• Application Forms

• Written Tests

• Performance Simulations

• Interviews

• Background Investigations

• Physical Examinations

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Exhibit 11.7 Selection Devices

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Written Tests

• Types of Tests– Intelligence: how smart are you?– Aptitude: can you learn to do it?– Ability: can you do it?– Interest: do you want to do it?

• Legal Challenges to Tests– Lack of job-relatedness of test to job requirements– Discrimination against members of areas protected

by the Employment Equity Act

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Performance Simulation Tests

• Testing an applicant’s ability to perform actual job behaviours, use required skills, and demonstrate specific knowledge of the job– Work sampling

• Requiring applicants to actually perform a task or set of tasks that are central to successful job performance

– Assessment centres• Dedicated facilities in which job candidates undergo

a series of performance simulation tests to evaluate their managerial potential

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Other Selection Approaches

• Situational Interviews– Interviews in which candidates are evaluated on

how well they handle role play in mock scenarios

• Background Investigations– Verification of application data– Reference checks:

• Lack validity because self-selection of references ensures only positive outcomes

• Physical Examinations– Useful for physical requirements

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Questions Not to Ask Job Candidates• About name changes; maiden name• For birth certificate, baptismal records, or about age in general• About pregnancy, child bearing plans, or child care arrangements• Whether applicant is single, married, divorced, engaged, separated,

widowed, or living common-law• About birthplace, nationality of ancestors, spouse, or other relatives• Whether born in Canada• For photo to be attached to application or sent to interviewer before

interview• About religious affiliation, church membership, frequency of church

attendance• Whether the applicant drinks or uses drugs• Whether the applicant has ever been convicted• Whether the applicant has ever been arrested• Whether the applicant has a criminal record• About the applicant’s sexual orientation

Sample Questions Taken from Exhibit 11.8

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Tips for Managers: Some Suggestions for Interviewing

• Structure a fixed set of questions for all applicants.

• Have detailed information about the job for which applicants are interviewing.

• Minimize any prior knowledge of applicants’ background, experience, interests, test scores, or other characteristics.

• Ask behavioural questions that require applicants to give detailed accounts of actual job behaviours.

• Use a standardized evaluation form.

• Take notes during the interview.

• Avoid short interviews that encourage premature decision making.

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Exhibit 11.9 Quality of Selection Devices as Predictors

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Other Selection Approaches (cont’d)

• Realistic Job Preview (RJP)– The process of relating to an applicant both

the positive and the negative aspects of the job

• Encourages mismatched applicants to withdraw• Aligns successful applicants’ expectations with

actual job conditions, reducing turnover

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Orientation and Skill Development

• Bringing a new employee into the organization– Work-unit orientation

• Familiarizes new employee with work-unit goals• Clarifies how his or her job contributes to unit goals• Introduces employee to his or her co-workers

– Organization orientation• Informs new employee about the organization’s

objectives, history, philosophy, procedures, and rules• Includes a tour of the entire facility

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Exhibit 11.10 Types of Training

• Interpersonal skills

• Technical

• Business

• Mandatory

• Performance management

• Problem solving/decision making

• Personal

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Exhibit 11.11 Employee Training Methods

• Traditional Training Methods

– On-the-job

– Job rotation

– Mentoring and coaching

– Experiential exercises

– Workbooks/manuals

– Classroom lectures

• Technology-based Training Methods

– CD-ROM/ DVD/videotapes/ audiotapes

– Videoconferencing/ teleconferencing/satellite TV

– E-learning or other interactive modules.

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Exhibit 11.12a Occupations of Employees Who Receive Training

0

10

20

30

40

50

60

70

80

90

100

Professional and managerial white collar occupationsClerical, sales, and service white collar occupations

Blue collar occupations

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Exhibit 11.12b How Employees Train Themselves

0

10

20

30

40

50

60

70

80

90

100

Sought advice from someone

Used the Internet or computer software

Observed someone perform a task

Consulted books/manuals/other documents

Taught themselves by trying different methods

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Managing and Rewarding Performance

• Performance Management System– A process establishing performance

standards and appraising employee performance in order to arrive at objective HR decisions and to provide documentation in support of those decisions

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Performance Appraisal Methods

• Written Essays

• Critical Incidents

• Graphic Rating Scales

• Behaviourally Anchored Rating Scales (BARS)

• Multiperson Comparisons

• Management by Objectives (MBO)

• 360-Degree Feedback

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Exhibit 11.13 Advantages and Disadvantages of Performance Appraisal Methods

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Compensation 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

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Exhibit 11.14 Factors That Influence Compensation and Benefits

Sources: Based on R.I. Henderson, Compensation Management, 6th ed. (Upper Saddle River, NJ: Prentice Hall, 1994), pp. 3–24; and A. Murray, “Mom, Apple Pie, and Small Business,” Wall Street Journal, August 15, 1994, p. A1

Level of

Compensation

and Benefits

Employee’s Tenure

and Performance

Size of

Company

Kind of

Job Performed

Company

Profitability

Kind of

Business

Geographical

LocationUnionization

Management

Philosophy

Labour- or

Capital-Intensive

How long has employeebeen with company and

how has he or she performed?

Does job requirehigh levels of skills?

What industry is job in?

Is business unionized?

Is business labour- orcapital-intensive?

How large is thecompany?

How profitable is thecompany?

Where is organizationlocated?

What is management’sphilosophy toward pay?

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Public Sector Vs. Private Sector

• Governments pay about 9% more compared to private sector.

• Public sector employees: better benefit plans, likelihood of pension plans – Public sector pay rates: labour union equity

initiatives– Private sector pay rates: “market wages”

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Career Development

• Career Defined– A sequence of positions held by a person during his

or her lifetime

• Career Development– Provides for information, assessment, and training– Helps attract and retain highly talented people

• Boundaryless Career– A career in which individuals, not organizations,

define career progression, organizational loyalty, important skills, and marketplace value

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Top 10 Job Factors for College Graduates

(ranked in order of importance)1. Enjoying what they do2. Opportunity to use skills and abilities3. Opportunity for personal development4. Feeling what they do matters5. Benefits6. Recognition for good performance7. Friendly co-workers8. Job location9. Lots of money10. Working on teams Source: Based on V. Frazee.

“What’s Important to College Grads in Their First Jobs?” Personnel

Journal, July 1996, p. 21.

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Tips for Managers: Some Suggestions for a Successful Management Career

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Contemporary HRM Issues

• Managing Downsizing– The planned elimination of jobs in an

organization• Provide open and honest communication• Reassure survivors

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Contemporary HRM Issues (cont’d)

• Managing Workforce Diversity– Recruitment for diversity– Selection without discrimination– Orientation and training that is

effective

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Contemporary HRM Issues (cont’d)

• Sexual Harassment– An unwanted activity of a sexual nature that affects

an individual’s employment• The Supreme Court of Canada definition: Unwelcome

behaviour of a sexual nature in the workplace that negatively affects the work environment or leads to adverse job-related consequences for the employee

• There continues to be disagreement as to what specifically constitutes sexual harassment.

– An offensive or hostile environment• An environment in which a person is affected by

elements of a sexual nature

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Contemporary HRM Issues (cont’d)

• Work-Life Balance– Employees have personal lives that they don’t

leave behind when they come to work.– Organizations have become more attuned to their

employees by offering family-friendly benefits:• On-site child care

• Summer day camps

• Flextime

• Job sharing

• Leave for personal matters

• Flexible job hours