Business Essentials - Chapter 8 (additional).ppt

Human ResourceManagement

TENTH EDITON 2003 Southwestern College Publishing. All rights reserved.PowerPoint Presentation by Charlie CookStrategic Human Resource ManagementSECTION 1 Nature of Human Resource Management Chapter 2Robert L. Mathis John H. Jackson

2002 Southwestern College Publishing. All rights reserved. 2*Learning ObjectivesAfter you have read this chapter, you should be able to:Discuss why human resources can be a core competency for organizations.Define HR planning, and outline the HR planning process.Specify four important HR benchmarking measures.Identify factors to be considered in forecasting the supply and demand for human resources in an organization.

2002 Southwestern College Publishing. All rights reserved.

2002 Southwestern College Publishing. All rights reserved. 2*Learning Objectives (contd)Discuss several ways to manage a surplus of human resources.Identify what a human resource information system (HRIS) is and why it is useful when doing HR planning.


2002 Southwestern College Publishing. All rights reserved. 2*Human Resources as a Core CompetencyStrategic Human Resources ManagementOrganizational use of employees to gain or keep a competitive advantage against competitors.Core CompetencyA unique capability in the organization that creates high value and that differentiates the organization from its competition.


2002 Southwestern College Publishing. All rights reserved. 2*HR-Based Core CompetenciesOrganizational CultureThe shared values and beliefs of the workforceProductivityA measure of the quantity and quality of work done, considering the cost of the resources used.A ratio of the inputs and outputs that indicates the value added by an organization.Quality Products and ServicesHigh quality products and services are the results of HR-enhancements to organizational performance.


2002 Southwestern College Publishing. All rights reserved. 2*Human Resource PlanningHuman Resource (HR) PlanningThe process of analyzing and identifying the need for and availability of human resources so that the organization can meet its objectives.HR Planning ResponsibilitiesTop HR executive and subordinates gather information from other managers to use in the development of HR projections for top management to use in strategic planning and setting organizational goals


2002 Southwestern College Publishing. All rights reserved. 2*Human Resource Planning (contd)Small Business and HR Planning IssuesAttracting and retaining qualified outsidersManagement succession between generations of ownersEvolution of HR activities as business growsFamily relationships and HR policies


2002 Southwestern College Publishing. All rights reserved. 2*HR Planning ProcessHR StrategiesThe means used to anticipate and manage the supply of and demand for human resources.Provide overall direction for the way in which HR activities will be developed and managed.


2002 Southwestern College Publishing. All rights reserved. 2*Benefits of HR PlanningBetter view of the HR dimensions of business decisionsLower HR costs through better HR management.More timely recruitment for anticipate HR needsMore inclusion of protected groups through planned increases in workforce diversity.Better development of managerial talent


2002 Southwestern College Publishing. All rights reserved. 2*Scanning the External EnvironmentEnvironmental ScanningThe process of studying the environment of the organization to pinpoint opportunities and threats.Environment Changes Impacting HRGovernmental regulationsEconomic conditionsGeographic and competitive concernsWorkforce composition


2002 Southwestern College Publishing. All rights reserved. 2*Internal Assessment of the Organizational WorkforceAuditing Jobs and SkillsWhat jobs exist now?How many individuals are performing each job?How essential is each job?What jobs will be needed to implement future organizational strategies?What are the characteristics of anticipated jobs?


2002 Southwestern College Publishing. All rights reserved. 2*Internal Assessment of the Organizational WorkforceOrganizational Capabilities InventoryHRIS databasessources of information about employees knowledge, skills, and abilities (KSAs)Components of an organizational capabilities inventoryWorkforce and individual demographicsIndividual employee career progressionIndividual job performance data


2002 Southwestern College Publishing. All rights reserved. 2*Forecasting HR Supply and DemandForecastingThe use of information from the past and present to identify expected future conditions.Forecasting MethodsJudgmentalEstimatesasking managers opinions, top-down or bottom-upRules of thumbusing general guidelinesDelphi techniqueasking a group of expertsNominal groupsreaching a group consensus in open discussion


2002 Southwestern College Publishing. All rights reserved. 2*Forecasting HR Supply and DemandForecasting Methods (contd)MathematicalStatistical regression analysis Simulation models Productivity ratiosunits produced per employeeStaffing ratiosestimates of indirect labor needsForecasting PeriodsShort-termless than one yearIntermediateup to five yearsLong-rangemore than five years


2002 Southwestern College Publishing. All rights reserved. 2*Forecasting HR Supply and DemandForecasting the Demand for Human ResourcesOrganization-wide estimate for total demandUnit breakdown for specific skill needs by number and type of employeeDevelop decision rules (fill rates) for positions to be filled internally and externally.Develop additional decision rules for positions impacted by the chain effects of internal promotions and transfers.Forecasting the Supply for Human ResourcesExternal SupplyInternal Supply


2002 Southwestern College Publishing. All rights reserved. 2*Forecasting HR Supply and DemandForecasting External HR SupplyFactors affecting externalNet migration for an areaIndividuals entering and leaving the workforceIndividuals graduating from schools and collegesChanging workforce composition and patternsEconomic forecastsTechnological developments and shiftsActions of competing employersGovernment regulations and pressuresOther factors affecting the workforce


2002 Southwestern College Publishing. All rights reserved. 2*Forecasting HR Supply and DemandForecasting Internal HR SupplyEffects of promotions, lateral moves, and terminationsSuccession analysisReplacement chartsTransition matrix (Markov matrix)ExitManagerSupervisorLine WorkerManager.15.85.00.00.Supervisor.10.15.70.05Line Worker.20.00.15.65


2002 Southwestern College Publishing. All rights reserved. 2*Managing Human Resource Surplus or ShortageWorkforce Reductions and the WARN ActIdentifies employer requirements for layoff advance notice.60-day notice to employees and the local community before a layoff or facility closing involving more than 50 people.Does not cover part-time or seasonal workers.Imposes fines for not following notification procedure.Has hardship clauses for unanticipated closures or lack of business continuance capabilities.


2002 Southwestern College Publishing. All rights reserved. 2*Managing Human Resource Surplus or ShortageWorkforce RealignmentDownsizing, Rightsizing, and Reduction in Force (RIF) all mean reducing the number of employees in an organization.CausesEconomicweak product demand, loss of market share to competitorsStructuraltechnological change, mergers and acquisitions


2002 Southwestern College Publishing. All rights reserved. 2*Managing Human Resource Surplus or ShortageWorkforce Realignment (contd)Positive consequencesIncrease competitivenessIncreased productivityNegative consequencesCannibalization of HR resourcesLoss of specialized skills and experienceLoss of growth and innovation skillsManaging survivorsProvide explanations for actions and the futureInvolve survivors in transition/regrouping activities


2002 Southwestern College Publishing. All rights reserved. 2*Managing Human Resource Surplus or ShortageDownsizing approachesAttrition and hiring freezesNot replacing departing employees and not hiring new employees/Early retirement buyoutsOffering incentives that encourage senior employees to leave the organization early. LayoffsEmployees are placed on unpaid leave until called back to work when business conditions improve.Employees are selected for layoff on the basis of their seniority or performance or a combination of both.


2002 Southwestern College Publishing. All rights reserved. 2*Managing Human Resource Surplus or ShortageDownsizing approaches (contd)Outplacement services provided to displaced employees to give them support and assistance:Personal career counselingResume preparation and typing servicesInterviewing workshopsReferral assistanceSeverance payments Continuance of medical benefitsJob retraining


2002 Southwestern College Publishing. All rights reserved. 2*Dealing with DownsizingInvestigate alternatives to downsizingInvolve those people necessary for success in the planning for downsizingDevelop comprehensive communications plansNurture the survivorsOutplacement pays off


2002 Southwestern College Publishing. All rights reserved. 2*Assessing HR EffectivenessDiagnostic Measures of HR EffectivenessHR expense per employeeCompensation as a percent of expensesHR department expense as a percent of total expensesCost of hiresTurnover ratesAbsenteeism ratesWorkers compensation per employee


2002 Southwestern College Publishing. All rights reserved. 2*Assessing HR EffectivenessHR AuditA formal research effort that evaluates the current state of HR management in an organizationAudit areas:Legal compliance (e.g., EEO, OSHA, ERISA, and FMLA)Current job specifications and descriptionsValid recruiting and selection processFormal wage and salary system BenefitsEmployee handbookAbsenteeism and turnover controlGrievance resolution processOrientation program Training and developmentPerformance management system


2002 Southwestern College Publishing. All rights reserved. 2*Using HR Research for AssessmentHR ResearchThe analysis of data from HR records to determine the effectiveness of past and present HR practices.Primary ResearchResearch method in which data are gathered first-hand for the specific project being conducted.Secondary ResearchResearch method using data already gathered by others and reported in books, articles in professional journals, or other sources.


2002 Southwestern College Publishing. All rights reserved. 2*HR Performance and BenchmarkingBenchmarkingComparing specific measures of performance against data on those measures in other best practice organizationsCommon BenchmarksTotal compensation as a percentage of net income before taxesPercent of management positions filled internallyDollar sales per employeeBenefits as a percentage of payroll cost


2002 Southwestern College Publishing. All rights reserved. 2*Doing the Benchmarking AnalysisReturn on Investment (ROI)Calculation showing the value of expenditures for HR activities.A = Operating costs for a new or enhance system for the time periodB = One-time cost of acquisition and implementationC = Value of gains from productivity improvements for the time period


2002 Southwestern College Publishing. All rights reserved. 2* HR Business Performance CalculationsFigure 211aSource: Adapted from Jac Fitz-Enz, Top 10 Calculations for Your HRIS, HR Focus, April 1998, S-3.


2002 Southwestern College Publishing. All rights reserved. 2* HR Business Performance CalculationsFigure 211bSource: Adapted from Jac Fitz-Enz, Top 10 Calculations for Your HRIS, HR Focus, April 1998, S-3.


2002 Southwestern College Publishing. All rights reserved. 2*Doing the Benchmarking AnalysisEconomic Value Added (EVA)A firms net operating profit after the cost of capital (minimum rate of return demanded by the shareholders) is deducted.Cost of capital is the benchmark for returns for all HR activities.Utility analysisAnalysis in which economic or other statistical models are built to identify the costs and benefits associated with specific HR activities


2002 Southwestern College Publishing. All rights reserved. 2*Human Resource Information SystemsHuman resource information systems (HRIS)An integrated system of hardware, software, and databases designed to provide information used in HR decision making.Benefits of HRISAdministrative and operational efficiency in compiling HR dataAvailability of data for effective HR strategic planningUses of HRISAutomation of payroll and benefit activitiesEEO/affirmative action tracking


2002 Southwestern College Publishing. All rights reserved. 2*Designing and Implementing an HRISHRIS Design IssuesWhat information available and what is information needed?To what uses will the information be put?What output format compatibility with other systems is required?Who will be allowed to access to the information?When and how often will the information be needed?


2002 Southwestern College Publishing. All rights reserved. 2*Accessing the HRISIntranetAn organizational (internal) network that operates over the Internet.ExtranetAn Internet-linked network that allows employees access to information provided by external entities.Web-based HRIS UsesBulletin boardsData accessEmployee self-serviceExtended linkage


Business Essentials - Chapter 8 (additional).ppt

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