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Accountability in Human
Resource Management
Dr. Jack J. Phillips
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Dr. Jack J. Phillips
Dr. Phillips has 27 years of corporate experience
in five industries. He has served as training and
development manager at two fortune 500companies. In 1992, Dr. Phillips founded
Performance Resources Organization (PRO), an
international consulting firm specializing in
human resources accountability programs.
Dr.Phillips has authored or edited ten books
addressing human resource development.
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The need for a Results-Based
ApproachTim Epps, vice president of People Systems
for Saturn Corp., in Troy Michigan, explains,
HR must become bottom line valid. It must
demonstrate its validity to the business, itsability to accomplish business objectives and
its ability to speak of accomplishments in
business language. The HR function mustperform in a measurable and accountable
way for the business to reach its objectives.
(Phillips 1996)
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Important trends related to HR
contribution
Increased importance of the HR function
Increased accountability
Organizational change and quality programs Improvement in productivity
Adoption of HR strategies
Growing use of HR information systems
Reliance on partnership relationships
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Important trends related to HR
contribution (cont.)
Increased importance of the HR function
Increased accountability
Organizational change and quality programs Improvement in productivity
Adoption of HR strategies
Growing use of HR information systems
Reliance on partnership relationships
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Measuring the HR contribution
Surveys
HR accounting
HR auditing HR case studies
HR cost monitoring
Competitive benchmarking
Key indicators
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Measuring the HR contribution
(cont.)
HR effectiveness index
HR management by objectives
HR profit centers Return on investment
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Developing a results-based
approach and a new model
Purposes of measurement and evaluation
Obstacles to measuring the contribution
Levels of evaluation
The attitude of the HR team
Sharing responsibilities for the HRmeasurement and evaluation
A results-based model for program
implementation
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Purposes of measurement and
evaluation
To determine whether a program is
accomplishing its objectives.
To identify the strengths and weaknesses ofthe HR process
To calculate the ROI in an HR program
To gather data to assist in marketing futureprograms.
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Purposes of measurement and
evaluation (cont.)
To determine if the program was
appropriate
To establish a data base that can assistmanagement in marketing decisions
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Obstacles to measuring the
contribution
Evaluation cost
Lack of top management commitment
Lack of evaluation knowledge Attention to evaluation design
Fear of evaluation
Lack of standards
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Levels of evaluation
It is helpful to view HR measurement and
evaluation as consisting of three levels:
Measure of perceived effectiveness
Measures of performance
Measures of return on investment
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A Results-Based Model for
Program Implementation*Step one: Needs analysis
*Step two: Measurement and evaluation System
Step three: Program Objectives
Step four: Program DevelopmentStep five: Program Implementation
*Step six: Cost M onitor ing
* Step seven: Data collection and analysis
* Step eight: I nterpretation and conclusion
* Step nine: Communicate resul ts
*Steps receiving recent emphasis
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Evaluation design
Evaluation design Is important to
the overall process of HR
measurement. It includes the timing ofmeasurements and the minimization of
factors that can threaten the validity of
program evaluation results.(Phillips, 1996)
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Evaluation design issues
Control groups
Timing of measurements
Factors that jeopardize validity
1) Time or history
2) Effects of testing3) Mortality
4) Selection bias
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Evaluation design and
implementation
Common evaluation designs.
One-shot program evaluation design
Single group, pre- and post-programmeasurement design
Single group, time series design
control group design
Ideal evaluation design
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One-shot program evaluation
design
Program
fully implemented
Program or
initiated completed
Program
Implementation
period
time
Data
collected
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Single group pre- and post-
measurement design
Program
fully implemented
Program or
initiated Program completed
implementation
period
Time
Data collected #1 Data collected #2
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Single group, Time Series
Design
Program
Fully implemented
or
Program program completed
initiated implementation
period time
Data collected Data collected Data collected Data collected
#1 #2 #3 #4
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Control group design
Program
fully implemented
Program or
initiated completed
ProgramImplementation
period
Experimental Time
group
Data collected #1 Data collected #2
Control No program Time
group
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Ideal evaluation design
Program fully implementedProgram initiated or completed
Program implementation
Experimental period Time
group A
Data collected #! Data collected #2
Control group No program Time
Program fully
implemented or
Program initiated completedProgram implementation
Experimental period Time
group B
Data collected #2
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Post measure only, control
group design
Program
fully implemented
Program or
initiated completed
Program
implementation
Experimental period Time
group
Data collected
#1
Control No program Time
group
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Measuring the total human
resource effort
Measuring the human resource
effort will help management
understand and appreciate the ways inwhich the human side of an
organization interacts with and effects
the financial side. (Phillips 1996)
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Measurement issues
Measurement is important to
determine success of performance.
Success also depends on the ability tomeasure performance and to use these
measurements persuasively to obtain
needed resources. (Phillips 1996)
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Measurement issues (cont..)
The following principles of
performance measurements apply:
The effectiveness of any function canbe measured by some combinations of
cost, time, quantity, quality, or
behavioral indices.
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Measurement issues(cont.)
A measurement system promotes
productivity by focusing attention on
the most important issues, tasks, andobjectives of the organization.
The performance of white collar
workers is best measured in groups.
The ultimate measure is effectiveness,
not efficiency.
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Measurement issues (cont.)
Managers can be measured by the
effectiveness and efficiency of the
units they manage.
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The HR contribution modelHR contribution model
HR Management
Functions
Programs
Policies
Practices
Strategy
Activities
HR performance measures
HR investment
Absence rate
Turnover rate
Job satisfaction
Organizational commitment
Organizationaleffectiveness measures
Revenue
Employees
Assets
Employee costs
Operating income
employee costs
Other factors
Revenue growth rate
Industry type
Economy
Market forces
Strategic choices
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HR performance measures
In determining which strategy of
measures to use, for your HR program,
four rules should be considered.
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The Four Rules
1. Each measure should represent the
impact of as many functions as
possible within the HR department.2. Each function should represent
functions that are important across
business and industry groups.
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The Four Rules
3. Each measure should represent data
that is available and assessable.
4. All of the measures must account forthe large portion of the activities,
programs,, and services of the HR
department.
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HR performance measures
(cont).
HR expenses
Absence rate
Turnover rate
Job satisfaction
Organizational commitment
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Using benchmarking to
measure HR effectiveness
The benchmarking process develops
standards of excellence from
organizations that are considered to
have the best practices.
(Phillips 1996).
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The seven phase benchmarking
process
7
Initiating
]improvement
frombenchmarking
1
Determiningwhat to
benchmark
2
Build the
benchmark team
3
Identify benchmarkingpartners
4
Collect
data
5
Analyze data
6
Distribute information
to benchmark
partners