HTM 2105 – LECTURE 1

STRATEGIC HUMAN RESOURCE

MANAGEMENT:

AN OVERVIEW

Reproduced from the Power Point from Mondy, Strategic Human Resource Management 11e (with permission from Pearson Education Asia Ltd.) 1-1

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Session Objectives

• Define human resource management.• Identify the human resource management

functions• Describe HR’s changing role in business• Explain who performs human resources

management tasks

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Session Objectives (Cont.)

• Explain the need for human resource manager to be a strategic partner

• Describe human capital metrics

• Describe the various human resource designations

• Describe the human resource function in small business, medium-sized and large firms, and explain the evolving HR organization

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Human Resource Management

• Utilization of individuals to achieve organizational objectives

• All managers at every level must concern themselves with human resource management

• Five functions

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1

Human Resource

Management

Human Resource

Development

Com

pens

atio

n

Staffing

Em

ployee and

Labor Relations

Safety and Health

Human Resource Management Functions

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1. Staffing

• Job Analysis

• Human Resource Planning

• Recruitment

• Selection

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Staffing (Cont.)

• Staffing - Process through which organization ensures it always has proper number of employees with appropriate skills in right jobs at right time to achieve organizational objectives

• Job analysis - Systematic process of determining skills, duties, and knowledge required for performing jobs in organization

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Staffing (Cont.)

• Human resource planning - Systematic process of matching internal and external supply of people with job openings anticipated in the organization over specified period of time

• Recruitment - Process of attracting individuals on a timely basis, in sufficient numbers, and with appropriate qualifications, to apply for jobs with an organization

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Staffing (Cont.)

• Selection - Process of choosing from a group of applicants the individual best suited for a particular position and the organization

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2. Human Resource Development

• Training• Development

• Career Planning• Career Development

• Organizational Development• Performance Management

• Performance Appraisal

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Human Resource Development (Cont.)

• Training - Designed to provide with knowledge and skills needed for a particular job

• Development - Involves learning that goes beyond today's job; more long-term focus

• Career planning - Ongoing process whereby individual sets career goals and identifies means to achieve them

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Human Resource Development (Cont.)

• Career development - Formal approach used by organization to ensure that people with proper qualifications and experiences are available when needed

• Organization development - Planned and systematic attempts to change the organization, typically to a more behavioral environment

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Human Resource Development (Cont.)

• Performance management - Goal-oriented process directed toward ensuring organizational processes are in place to maximize productivity of employees, teams, and ultimately, the organization

• Performance appraisal - Formal system of review and evaluation of individual or team task performance

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3. Compensation

Compensation - All rewards that individuals receive as a result of their employment

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Compensation (Cont.)

• Direct Financial Compensation - Pay that person receives in form of wages, salaries, bonuses, and commissions

• Indirect Financial Compensation (Benefits) - All financial rewards not included in direct compensation such as paid vacations, sick leave, holidays, and medical insurance

• Nonfinancial Compensation - Satisfaction that person receives from job itself or from psychological and/or physical environment in which person works

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4. Safety and Health• Safety - Involves protecting employees

from injuries caused by work-related accidents

• Health - Refers to employees' freedom from illness and their general physical and mental well being

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5. Employee and Labor Relations

Unionization

Firms Must

Recognize A

Union

7% in Private

Sector

Firms Must

Bargain in

Good Faith

12.1% Union

Membership

In U.S.

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Human Resource Research

• Human resource research is not separate function.

• It pervades all HR functional areas.

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Interrelationships of HRM Functions

• All HRM functions are interrelated

• Each function affects other areas

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HR’S Changing Role

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HR’s Changing Role: Questions That Are Being Asked

• Can some HR tasks be performed more efficiently by line managers or outside vendors?

• Can some HR tasks be centralized or eliminated altogether?

• Can technology perform tasks that were previously done by HR personnel?

• Many HR departments continue to get smaller.

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HR’s Changing Role:Who Performs Human

Resource Management Tasks?

• Human Resource Managers

• HR Outsourcing

• HR Shared Service Centers

• Professional Employer Organization (Employee Leasing)

• Line Managers

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Human Resource Manager

• Historically, the human resource manager was responsible for each of the five HR functions

• Acts in advisory or staff capacity

• Works with other managers to help them deal with human resource matters

• Today HR departments continue to get smaller because others are accomplishing certain functions

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Break Time

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HR Outsourcing

• Transfers responsibility to an external provider

• Market for HR outsourcing is growing dramatically

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Outsourcing

Improved

Quality

Reduces

Cost

Time

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HR Shared Service Centers (SSCS)

Takes routine, transaction-based activities that are dispersed and consolidates them in one location

HR Shared Service Centre

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Improved

Quality

Less HR

Personnel

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Professional Employer Organization (Employee Leasing)

Company that leases employees to other businesses

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Line Managers Performing HR Tasks

• Involved with human resources by nature of their jobs

• Line managers are now performing some duties typically done by HR

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HR as a Strategic Partner• HR executives must

understand complex organizational design

• Sharp deviation from what has traditionally been an administrative-type role for HR

• Connect HR to Business Strategy

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Strategic Activities CEOs Want from HR

• Determine workforce capabilities

• High level participation at the corporate table

• Understand the total organization including finance and profits

• Help line managers achieve their goals

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Strategic HR Audit

• If HR professionals are to achieve the level of respect they desire, they must be subjected to the audit process

• Auditors should document if HR activities are being accomplished in an optimum manner

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Human Capital Metrics

Measures of HR performance

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Examples of HR Metrics

• Time to fill open positions

• HR headcount ratios

• Administrative cost per employee

• Turnover cost

• Training return on investment

• Quality of hire

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Human Resource Designations

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Human Resource Executives, Generalists, and Specialists

Vice President, Human

Resources

Vice President, Industrial Relations

Manager, Compensation

Manager, Staffing

Manager, Training and Development

Benefits Analyst

Executive: Generalist: Specialist:

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HR Resource Designations

. Generalist – perform tasks in various HR related areas

. Specialist – concerned with only one specific area e.g., recruitment, compensations.

. Executive – Top-level Manager report to CEO

The Human Resource Functions in

Organizations of Various Sizes

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HR in Small Business

• Seldom have a formal HR Unit

• Other managers handle HR functions

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HR in Medium – Sized Firms

. Little specialization

. HR manager is essentially the

entire department

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Traditional Human Resource Function in Large Firm

• Separate sections were often created

• Placed under an HR Manager

• Each HR function may have a supervisor & staff

• HR Manager works closely with top management in formulating policy

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Traditional Human Resource Functions in a Large Firm

President and CEO

Vice President, Marketing

Vice President, Operations

Vice President, Finance

Vice President, Human

Resources

Manager, Training and Development

Manager, Compensation

Manager, Staffing

Manager, Safety and

Health

Manager, Labor

Relations

A Possible Evolving HR Organization Example

President and CEO

Vice President, Operations

Vice President, Strategic Human

Resources

Vice President, Finance

Director of Safety

and Health

Training & Development (Outsourced)

Compensation (Shared Service

Centers)

Staffing (Line Managers, Use of Applicant Tracking

Systems)

Vice President, Marketing

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END