Managing Human Resource - Dadang Iskandar · Performance appraisal 6. Reward systems 7. Labor...
Transcript of Managing Human Resource - Dadang Iskandar · Performance appraisal 6. Reward systems 7. Labor...
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Managing Human Resource
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Strategic Human Resources Management (HRM)
Human Resources Management (HRM) formal systems for the management of people within the organization
human resources have a strategic impact create value are rare are difficult to imitate are organized
human capital - the knowledge, skills, and abilities of employees that have economic value
the emphasis on different HR activities depends on whether the organization is growing, declining, or standing skill
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Strategic HRM (cont.)
The HR planning process a three-stage activity with a strategic purpose
derived from the organization‘s plans 1. planning - determine the organization‘s plans
2. programming - create specific HR activities
3. evaluating - determine whether HR programs are producing the results needed to contribute to the organization
Demand forecasts - determine how many and what type of people are needed
derived from organizational plans
based on current sales and projected future sales growth
determine the demand for different types of workers
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An Overview Of The HR Planning Process
1. Labor markets 2. Technology 3. Legislation 4. Competition 5. Economy
1. Demand forecast 2. Internal labor supply 3. External labor supply 4. Job analysis
HRM environmental
scanning
Human resources planning
Organizational strategic planning
Planning
1. Employee recruitment 2. Employee selection 3. Outplacement 4. Training and development 5. Performance appraisal 6. Reward systems 7. Labor relations
Human resources activities
Programming
1. Productivity 2. Quality 3. Innovation 4. Satisfaction 5. Turnover 6. Absenteeism 7. Health
Results
Evaluation
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Strategic HRM (cont.)
The HR planning process (cont.) Labor supply forecasts - estimates of how many and what types of employees the organization actually will have evaluate current employees and the available external supply of workers
forecasts of a diverse workforce have become fact
Reconciling supply and demand labor deficit - hire new employees, promote current employees to new positions, or train other employees to move in from other areas in the organization
labor surplus - lay off employees or transfer them to other areas
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Strategic HRM (cont.)
The HR planning process (cont.)
Job analysis - a tool for determining what is done on a given job and what should be done on that job
1. job description - tells about the job itself
2. job specification - describes the employee characteristics needed to perform the job
provides the information that virtually every HR activity requires
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Human Resource Management
Attracting, developing, and maintaining an effective workforce
A critical, bottom-line function!
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The Nature of Human Resources Management (HRM)
HRM:
All activities involved in determining an organization‘s human resource needs, as well as acquiring, training, and compensating people to fill those needs
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Forecasting Labor Supply
1. Internal Forecasting: a. Replacement Charts
b. Skills Inventories
2. External Forecasting: a. State Employment
Commissions
b. Government Reports
c. College Information
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Managing a Projected Shortfall
1. Hire new employees
2. Consider hiring temporary workers
3. Retrain and transfer current employees into understaffed areas
4. Convince older workers not to retire
The creative solution:
Develop and install productivity
enhancing systems
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Planning for Human Resources Needs
Typical HR Issues:
How many employees?
What skills are needed to satisfy plans?
Availability of people in the workforce?
What qualifications must employees have? (proficiency level)
Cost of staffing?
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Recruiting: Attracting Qualified Candidates to Apply for a Job
Internal Recruiting
Considering current employees for new positions
External Recruiting
Attracting outside candidates to apply for jobs
What are the strengths and
weaknesses of each
approach?
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Staffing The Organization
Recruitment the development of a pool of applicants for jobs in
the organization
1. Internal recruiting advantages - employers know their employees
employees know their organization
provides opportunity to move up within the organization
drawbacks - yields limited applicant pool can inhibit a company that wants to change
job posting - a mechanism for advertising open positions
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Staffing The Organization (cont.)
Recruitment (cont.) 2. External recruiting - brings new blood into the
organization a. newspaper advertisements - popular recruiting source
that is inexpensive and generates a large number of responses
b. employee referrals - some companies offer rewards for referrals
c. campus recruiting - large pool of people 1) applicants have up-to-date training 2) source of innovative ideas
d. Internet - becoming more common to advertise job openings and to gather applicant information
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3.84
3.81
3.71
3.08
3.05
2.86
2.78
1.92
1.64
Employee referrals
Executive search firms
Want ads
Private employment agencies
Unions
College recruiting
Professional associations
Direct applications
Public employment agencies
Effectiveness Of Recruitment Sources
Scale: 1 = not good, 3 = average, 5 = extremely good
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Staffing The Organization (cont.)
Selection choosing from among qualified applicants to hire 1. Application and résumés - provide basic
information to prospective employers tend not to be useful for making final selection decisions
2. Interviews - most popular selection tool questions that are not job related are prohibited unstructured (nondirective) - interviewer asks different
interviewees different questions structured - interviewer asks all applicants the same
questions situational interview - focuses on hypothetical situations behavioral description interview - explores applicant‘s past
behavior
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Staffing The Organization (cont.)
Selection (cont.) 3. Reference checks - reference information is becoming
increasingly difficult to obtain
4. Personality tests -may be difficult to defend in court • nonetheless, regaining popularity
5. Drug testing • Drug-Free Workplace Act of 1988
• genetic testing - identifies the likelihood of contracting a disease
6. Cognitive ability tests - measure intellectual abilities
7. Performance tests - require performing a sample of the job
have been developed for almost every occupation
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Staffing The Organization (cont.)
Selection (cont.) 8. Assessment center - managerial performance
test in which candidates participate in a variety of exercises and situations
• taps a number of critical managerial dimensions • assessors generally are line managers from the
organization
9. Integrity tests - assess a job candidate‘s honesty
polygraphs (lie detector tests) - banned for most employment purposes
paper-and-pencil tests - more recent tests of integrity evidence of validity
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Staffing The Organization (cont.)
Selection (cont.) 10.Reliability - the consistency of test scores over
time and across alternative measurements 11.Validity
criterion-related validity - degree to which a test actually predicts or correlates with job performance reliance on scatterplots to depict the relationship between test
scores and job performance
content validity - degree to which selection tests measure a representative sample of the knowledge, skills, and abilities required for the job more subjective (less statistical) than criterion-related validity not less important than criterion-related validity
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Staffing The Organization (cont.)
Workforce reductions 1. Layoffs (downsizing) - laying off large numbers of
employees as a result of restructuring in the industry victims - lose self-esteem, suffer demoralizing job
searches, and are stigmatized by being out of work
outplacement - process of helping people who have been dismissed to regain employment elsewhere
survivors - suffer disenchantment, distrust, and lethargy a good performance appraisal process helps survivors avoid
feeling that they retained their jobs due to arbitrary decision making
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Staffing The Organization (cont.)
Workforce reductions (cont.) 2. Termination - ―firing‖ an at-will employee
if the employee can quit for any reason, employer should be able to fire for any reason
courts in most states have made exceptions to this doctrine public policy exceptions
progressive discipline - graduated steps used to correct workplace behavior
termination interview - stressful situation for all parties used to discuss the company‘s position with the employee often good to have a third party present conduct the interview in a neutral location
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Job Analysis: Systematic Review of Jobs Within a Firm
Job Description
Responsibilities and working conditions, plus tools, materials and equipment to perform the job
Job Specification
Skills, abilities, and credentials needed to perform the job
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Processes of Job Analysis
1. Job Analysis: The determination through observation and study, of
pertinent information about a job, including specific tasks and necessary abilities, knowledge, and skills
2. Job Description: The formal, written description of a specific job, such
as the job title, tasks to be performed, physical and mental skills required, duties, and responsibilities
3. Job Specification: The written description of the qualifications necessary
for a specific job, such as education, experience, personal characteristics, and physical characteristics
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Recruiting New Employees
Internal The organization‘s current employees
External Advertisements in newspapers and professional
journals Employment agencies Colleges, vocational schools Recommendations from current employees Competing firms Unsolicited applications Online
Did You Know? Several years ago, 21% of companies
said they recruited online. Experts say it
over 80% today.
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The Selection Process
JOB
Application
Interview
Testing
Reference Checking
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Selecting Human Resources
Application Forms
Tests
Interviews
Validity
The predictive value of a selection technique
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Interviewing Tips
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Top 10 Interview Questions
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Myers-Briggs Type Indicator Categories
Source: Christopher Caggiano, “Psycho Path,” Inc., July 1998, p. 81. Reprinted with permission of
Inc. Magazine, Goldhirsh Group, Inc. Reproduced by permission of the publisher via Copyright
Clearance Center, Inc.
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Affirmative Action
Legally mandated plans that try to increase job opportunities for minority groups by:
Analyzing the current pool of workers
Identifying areas where women and minorities are underrepresented
Establishing specific hiring and promotion goals, with target dates, for addressing discrepancy
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Developing the Workforce
Training
On-the-job training
Off-the-job training
Vestibule training
Performance Appraisal
Evaluating job performance
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Developing the Workforce
Employee orientation Familiarizes the newly hired employees with fellow
workers, company procedures, and the physical properties of the company.
Employee training and development On-the-job
Classroom
Assessing employee performance Performance appraisals
Did You Know?
Internet-based training is expected to grow
to be a $14.5 billion market by 2004.
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Developing The Workforce
Training and development Training - teaching lower-level employees how to perform their
present jobs
Developing - teaching managers and professional employees broad skills needed for their present and future jobs
Overview of the training process phase one - needs assessment
identify the jobs, people, and departments which need training
phase two - design the training to meet training goals
phase three - decide what training methods to use
phase four - evaluate the training‘s effectiveness
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Developing The Workforce (cont)
Types of training Orientation - training designed to introduce new
employees to the company and familiarize them with policies, procedures, culture, and the like benefits may include lower turnover, increased morale, higher productivity, and lower recruiting and training costs
Team training - provides employees with the skills and perspectives they need to work in collaboration with others
Diversity training - focuses on identifying and reducing hidden biases against people with differences and developing the skills needed to effectively manage a diversified workforce
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Performance Appraisal
Performance appraisal the assessment of an employee‘s job performance two basic purposes
administrative - provides information for making salary, promotion, and layoff decisions
developmental - diagnoses training needs and enables career planning
What do you appraise? 1. Trait appraisals - subjective judgments about
employee performance often leads to personal bias may not be suitable for obtaining useful feedback
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Performance Appraisal (cont.)
What do you appraise? (cont.) 2. Behavioral appraisals - focus on more observable
aspects of performance helps ensure that all parties understand what the ratings are
really measuring
3. Results appraisals - tend to be more objective focus on production data Management By Objectives (MBO) - subordinate and
supervisor agree on specific performance goals develop a plan for attaining the goals identify criteria for determining whether goals have been reached useful when managers want to empower employees may focus on short-term achievement and ignore long-term goals
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Example Of BARS Used For Evaluating Quality
Uses measures of quality and well-defined
processes to achieve project goals.
Defines quality from the client’s perspective.
Look for/identifies ways to continually improve the process.
Clearly communicates quality management to others.
Develops a plan that defines how the team will participate in quality.
Appreciates TQM as an investment.
Has measures of quality that define tolerance levels.
Views quality as costly.
Legislates quality.
Focuses her/his concerns only on outputs and
deliverables, ignoring the underlying process.
Blames others for absence of quality.
Gives lip service only to quality concerns.
7
6
5
4
3
2
1
Outstanding
Average
Poor
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Guidelines For Choosing An Appraisal System
Evaluate on
specific
behaviors
Document
the process
carefully
Attend to
legal
considerations
Appraisal
System
Use job analysis
for performance
standards
Develop a formal
appeal process
Use more than
one rater where
possible
Communicate
performance
standards
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Performance Appraisal (cont.)
Who should do the appraisal? 1. managers and supervisors - traditional source of appraisal
information 2. peers and team members - best at identifying leadership
potential and interpersonal skills 3. subordinates - provide feedback to supervisors 4. internal and external customers
internal customers include anyone inside the organization who depends upon an employee‘s work output
5. self-appraisals - increases worker‘s involvement in appraisal
6. 360 degree appraisal - uses multiple sources to gain comprehensive perspective of one‘s performance
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Performance Appraisal (cont.)
How do you give employees feedback? performance feedback is a stressful task for all parties most difficult interviews are with employees who are performing poorly
no ―one best way‖ to perform the appraisal interview
follow-up meetings may be necessary
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Employee Turnover
1. Promotion
2. Transfer
3. Separation
a. Resignation
b. Retirement
c. Termination
d. Layoffs
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Compensating the Work Force
1. Time Wages
Financial award based on number of hours worked
2. Piece Wages
Financial award based on the output attained by the employee
3. Commission
Payment to an employee of a fixed amount or a percentage of the employee‘s sales
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Compensating the Workforce
Salary Financial award calculated on a weekly, monthly, or annual
basis
Bonus An addition to regular compensation for exceptional
performance or in appreciation for good work
Profit sharing Distribution of percentage of company profit to employees;
sometimes distribution is in the form of company stock (ESOP Employee Stock Ownership Program)
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Hourly Wages: U.S. vs. India
U.S. Occupation India
$12.57 Telephone Operator Under $1.00
$13.17 Medical (Health Record) Technologists/Transcriptionists
$1.50-2.00
$15.17 Payroll Clerk $1.50-2.00
$17.86 Legal Assistant/Paralegal $6.00-8.00
$23.35 Accountant $6.00-15.00
$33.00-35.00 Financial Researcher/Analyst $6.00-15.00
Matthew Grimm (2004) “Profits vs. Jobs”. American Demographics, June 1,
www.demographics.com.microsites.magazineartcle.asp? …accessed August 2, 2004.
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Retention Methods
Source: Kemba J. Dunham, “The Jungle,” The Wall Street Journal, May 15, 2001, p. B12. Copyright ©
2001 by Dow Jones & Co., Inc. Reprinted with permission of Dow Jones & Co., Inc. via Copyright
Clearance Center. 60% Flexible hours and schedules 53% Mentoring programs 25% Profit-sharing
22%
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Benefits
Nonfinancial forms of compensation provided to employees such as:
Pension plans for retirement
Health, disability, and life insurance
Holidays and paid days off for vacation or illness
Credit union membership
Health programs
Child care
Elder care
Assistance with adoption
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Designing Reward Systems
Pay decisions effective reward systems attract, motivate, and retain people
three types of decisions are crucial pay level - choice of whether to be a high-, average-, or low-paying company
pay structure - choice of how to price different jobs within the organization
jobs similar in worth are grouped into families
individual pay decisions - concern different pay rates for jobs of similar worth within the same family
decisions based on: seniority performance
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Factors Affecting The Wage Mix
Wage
Mix
Internal factors External factors
Compensation policy
of organization
Employer’s ability to pay
Employee’s
relative worth
Worth of job
Conditions of the
labor market
Area wage rates
Cost of living
Collective bargaining
Legal requirements
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Pay Structure
Range
150 500 450 400 350 300 250 200
Job worth (total points)
Range overlap
Range steps
Midpoint 4.50
8.00
7.50
7.00
6.50
6.00
5.50
5.00
Wage
rate
s
Maximum rate
Wage curve
Minimum rate
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Designing Reward Systems (cont.)
Incentive systems and variable pay individual incentive plans - most common type
consists of an objective standard against which a worker‘s performance is compared
group incentive plans gainsharing - concentrate on saving money
profit-sharing - incentives based on unit, department, plant, or company productivity
each group has a production standard
pay is based on the amount of production over the standard
merit pay system - used in the absence of an objective standard
bonuses based on supervisor‘s judgment of employee‘s merit
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Designing Reward Systems (cont.)
Employee benefits benefits required by law
workers’ compensation - provides financial support to employees suffering from a work-related injury or illness
social security - provides financial support to retirees also covers disabled employees
unemployment insurance - provides financial support to employees who are laid off for reasons beyond their control
benefits not required by law cafeteria benefit plan - employees choose from a menu of options to create a benefit package tailored to their needs
flexible benefit plan - employees are given credits to spend on benefits that fit their unique needs
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Increasing Employee Satisfaction
Source: “Hewitt Study Shows Work/Life Benefits Continue to Grow Despite Slowing Economy,” Hewitt
Associates LLC press release, April 23, 2001.
Benefits: % Offering
Child care assistance 91
Elder care programs 49
Flexible schedules 73
Adoption benefits 32
Personal/professional growth 78
Financial security programs 41
Group/discounted purchases 39
On-site personal services 57
Casual dress 66
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Managing Unionized Employees
Labor Unions:
Employee organizations formed to deal with employers to achieve better pay, hours, and working conditions
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Managing Unionized Labor
Collective Bargaining:
The negotiation process through which management and unions reach agreement about compensation, working hours, and working conditions for a bargaining unit
Labor Contract:
The formal, written document that spells out the relationship between the union and management for a specified period of time – usually two or three years
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Resolving Disputes
Labor‘s Tactics
Strikes
Picketing
Boycott
Management‘s Tactics
Lockout
Strikebreakers/hiring replacements
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Outside Resolution
Conciliation The conciliator‘s goal is to get both parties to
focus on the issues and to prevent negotiations from breaking down
Mediation The mediator‘s role is to suggest or propose a
solution to the problem
Arbitration The arbitrator‘s solution is legally binding and
enforceable
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Determinants Of Union Voting Behavior
Union image •Corrupt?
•Too powerful?
•Unnecessary given
•current legislation
Job attitudes •Job dissatisfaction
•Unfair supervision
•Poor communication
Union vote:
Yes
or
No
Beliefs in union power
•Wages
•Power
•Working conditions
Economic needs •Wages
•Hours
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Labor Relations (cont.)
Collective bargaining to reach an agreement, workers may conduct an economic strike
arbitration - use of a neutral third party to resolve a labor dispute used to deal with disagreements about interpretation of the contract
avoids wildcat strikes in which workers walk off the job in violation of the contract
union shop - union security clause specifying that workers must join the union after a set period of time on the job
right to work - state legislation that prohibits the negotiation of union shop clauses
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Workforce Diversity
Understanding diversity means recognizing and accepting differences as well as valuing the unique perspectives such differences can bring to the workplace
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Characteristics of Diversity
Source: Marilyn Loden and Judy B. Rosener, Workforce America! Managing Employee Diversity as a Vital Resource,
1991, p. 20. Used with permission. Copyright © 1991 Richard D. Irwin, a Times Mirror Higher Education Group, Inc.,
company.
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The Benefits of Workforce Diversity
1. More productive use of a company‘s human resources
2. Reduced conflict among employees of different backgrounds as they learn to respect each other‘s differences
3. More productive working relationships 4. Increased commitment to and sharing of
organizational goals among diverse employees at all organizational levels
5. Increased innovation and creativity 6. Increased ability to serve the needs of an
increasingly diverse customer base
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Satu
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High Low Test score High
Low
Test score
High
Low
Per
form
an
ce
High
Low
Per
form
an
ce
Coefficient of correlation = .00 Coefficient of correlation = .75
Correlation Scatterplots
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100
80
60
40
20
0
Perc
en
tage u
sin
g
Overall 10,000
or more
2,500-9,999 1,000-2,499 500-999 100-499
Number of employees
Classroom programs -
live
Videotapes
Videoconferencing
(individual desktops)
Outdoor experiential
programs
Satellite/
Broadcast TV
Videoconferencing
(to group)
Games/Simulations
(computer-based)
Internet/WWW
Selected Instructional Methods And Media
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Dua
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Incentive Programs
Money linked specifically to high performance
Bonuses
Incentives
Compensation and Benefits
Wages
Money paid for time worked
Salary
Money paid for accomplishing a specific job
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Benefits: Compensation Other Than Wages and Salaries
Optional Benefits
Retirement plans
Health, life, and disability insurance
Vacations and holidays
Counseling services
Mandatory Benefits
Social security
Workers’ compensation
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Equal Opportunity: Unfair Discrimination Is Illegal
Equal Opportunity Laws
Protect workers from discrimination based on prejudice
Protected Class
People with common characteristics as indicated by law
EEOC
Federal agency that enforces discrimination-related laws
Affirmative Action
Plan to hire and develop members of protected classes
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Contemporary Legal Issues in Human Resource Management
Employee safety and health
AIDs in the workplace
Sexual harassment
Quid pro quo
Hostile work environment
Employment-at-will
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Managing Knowledge Workers
Knowledge workers add value because of what they know.
Computer Scientists
Physical Scientists
Engineers
Hiring and retaining knowledge workers is a
critical HR challenge
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Developing a Management Strategy
Assessing True Costs
Understanding Pros and Cons
Contingent Workers: A Rapidly Growing Trend
Management challenges: Careful Planning
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Labor Relations
Managing unionized employees
Managing Organized Labor
Labor Union
People working together to achieve shared job-related goals
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Trends in Organized Labor
Union-Management
Relations Bargaining
Perspectives
Future Outlook
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Contract Issues
Compensation
Benefits
Job Security
Other Union Issues
Management Rights
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When Bargaining Fails…
Union Tactics:
Strike
Picketing
Boycott
Work slowdown
Management Tactics:
Lockouts
Strikebreakers
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Mediation
Voluntary Arbitration
Compulsory Arbitration
Resolving Disputes
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Dua Thank you
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Rujukan lain
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Chapter Twelve
Managing Human Resources
Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin
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The Nature of Human Resources Management (HRM)
HRM:
All activities involved in determining an organization‘s human resource needs, as well as acquiring, training, and compensating people to fill those needs
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Planning for Human Resources Needs
Typical HR Issues:
How many employees?
What skills are needed to satisfy plans?
Availability of people in the workforce?
What qualifications must employees have?
Cost of staffing?
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Processes of Job Analysis
Job Analysis: The determination through observation and study,
of pertinent information about a job, including specific tasks and necessary abilities, knowledge, and skills
Job Description: The formal, written description of a specific job,
such as the job title, tasks to be performed, physical and mental skills required, duties, and responsibilities
Job Specification: The written description of the qualifications
necessary for a specific job, such as education, experience, personal characteristics, and physical characteristics
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Recruiting New Employees
Internal The organization‘s current employees
External Advertisements in newspapers and professional
journals Employment agencies Colleges, vocational schools Recommendations from current employees Competing firms Unsolicited applications Online
Did You Know? Several years ago, 21% of companies
said they recruited online. Experts say
it over 80% today.
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The Selection Process
JOB
Application
Interview
Testing
Reference Checking
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Interviewing Tips
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Top 10 Interview Questions
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Myers-Briggs Type Indicator Categories
Source: Christopher Caggiano, “Psycho Path,” Inc., July 1998, p. 81. Reprinted with permission of
Inc. Magazine, Goldhirsh Group, Inc. Reproduced by permission of the publisher via Copyright
Clearance Center, Inc.
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Legal Issues in Recruiting and Selecting New Employees
Fair Labor Standards Act (1938) Sets minimum wages and overtime rates (for any time over 40
hours per week).
Equal Pay Act (1963) Requires that men and women who do equal work be paid
equally.
Title VII of the Civil rights Act (1964) Created the Equal Employment Opportunity Commission
Mandates affirmative action programs
Outlaws discrimination on the basis of sex, race, color, or national origin Did You Know?
40+ years after the Civil Rights Act was passed,
corporate officers are only 8.2% African
American,5% Hispanic, and 12.5% women.
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Legislation Regulating Hiring and Compensation Practices
Age Discrimination in Employment Act (1967)
Outlaws employment practices that discriminate on the basis of age
Americans with Disabilities Act
Prevents discrimination against disabled persons
Source: Annie Finnigan, “Different Strokes,” Working Woman, April 2001, p. 42.
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Affirmative Action
Legally mandated plans that try to increase job opportunities for minority groups by:
Analyzing the current pool of workers
Identifying areas where women and minorities are underrepresented
Establishing specific hiring and promotion goals, with target dates, for addressing discrepancy
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Developing the Workforce Employee orientation
Familiarizes the newly hired employees with fellow workers, company procedures, and the physical properties of the company.
Employee training and development On-the-job
Classroom
Assessing employee performance Performance appraisals
Did You Know?
Internet-based training is expected to grow
to be a $14.5 billion market by 2004.
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Employee Turnover
Promotion
Transfer
Separation
Resignation
Retirement
Termination
Layoffs
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Compensating the Work Force
Time Wages Financial award based on number of hours
worked
Piece Wages Financial award based on the output
attained by the employee
Commission Payment to an employee of a fixed amount
or a percentage of the employee‘s sales
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Compensating the Workforce
Salary
Financial award calculated on a weekly, monthly, or annual basis
Bonus
An addition to regular compensation for exceptional performance or in appreciation for good work
Profit sharing
Distribution of percentage of company profit to employees; sometimes distribution is in the form of company stock
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Hourly Wages: U.S. vs. India U.S. Occupation India
$12.57 Telephone Operator Under $1.00
$13.17 Medical (Health Record) Technologists/Transcriptionists
$1.50-2.00
$15.17 Payroll Clerk $1.50-2.00
$17.86 Legal Assistant/Paralegal $6.00-8.00
$23.35 Accountant $6.00-15.00
$33.00-35.00 Financial Researcher/Analyst $6.00-15.00
Matthew Grimm (2004) “Profits vs. Jobs”. American Demographics, June 1,
www.demographics.com.microsites.magazineartcle.asp? …accessed August 2, 2004.
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Retention Methods
Source: Kemba J. Dunham, “The Jungle,” The Wall Street Journal, May 15, 2001, p. B12. Copyright ©
2001 by Dow Jones & Co., Inc. Reprinted with permission of Dow Jones & Co., Inc. via Copyright
Clearance Center. 60% Flexible hours and schedules 53% Mentoring programs 25% Profit-sharing
22%
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Benefits Nonfinancial forms of compensation
provided to employees such as:
Pension plans for retirement
Health, disability, and life insurance
Holidays and paid days off for vacation or illness
Credit union membership
Health programs
Child care
Elder care
Assistance with adoption
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Increasing Employee Satisfaction
Source: “Hewitt Study Shows Work/Life Benefits Continue to Grow Despite Slowing Economy,” Hewitt
Associates LLC press release, April 23, 2001.
Benefits: % Offering
Child care assistance 91
Elder care programs 49
Flexible schedules 73
Adoption benefits 32
Personal/professional growth 78
Financial security programs 41
Group/discounted purchases 39
On-site personal services 57
Casual dress 66
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Managing Unionized Employees
Labor Unions:
Employee organizations formed to deal with employers to achieve better pay, hours, and working conditions
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Managing Unionized Labor
Collective Bargaining: The negotiation process through which
management and unions reach agreement about compensation, working hours, and working conditions for a bargaining unit
Labor Contract: The formal, written document that spells
out the relationship between the union and management for a specified period of time – usually two or three years
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Resolving Disputes
Labor‘s Tactics
Strikes
Picketing
Boycott
Management‘s Tactics
Lockout
Strikebreakers/hiring replacements
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Outside Resolution
Conciliation
The conciliator‘s goal is to get both parties to focus on the issues and to prevent negotiations from breaking down
Mediation
The mediator‘s role is to suggest or propose a solution to the problem
Arbitration
The arbitrator‘s solution is legally binding and enforceable
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Workforce Diversity
Understanding diversity means recognizing and accepting differences as well as valuing the unique perspectives such differences can bring to the workplace
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Characteristics of Diversity
Source: Marilyn Loden and Judy B. Rosener, Workforce America! Managing Employee Diversity as a Vital Resource,
1991, p. 20. Used with permission. Copyright © 1991 Richard D. Irwin, a Times Mirror Higher Education Group, Inc.,
company.
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The Benefits of Workforce Diversity
1. More productive use of a company‘s human resources
2. Reduced conflict among employees of different backgrounds as they learn to respect each other‘s differences
3. More productive working relationships
4. Increased commitment to and sharing of organizational goals among diverse employees at all organizational levels
5. Increased innovation and creativity
6. Increased ability to serve the needs of an increasingly diverse customer base
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Bateman Snell
Management
5th Edition
Competing in the New Era
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Part Three Chapter 10 - Human Resources Management
Chapter Outline
Strategic Human Resources Management
Staffing the Organization
Developing the Workforce
Performance Appraisal
Designing Reward Systems
Labor Relations
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Learning Objectives
After studying Chapter 10, you will know:
how companies use human resources management to gain competitive advantage
why companies recruit both internally and externally for new hires
the various methods available for selecting new employees
why companies spend so much on training and development
how to determine who should appraise an employee‘s performance
how to analyze the fundamental aspects of a reward system
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Learning Objectives
After studying Chapter 10, you will know:
how unions influence human resources management
how the legal system influences human resources management
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Strategic Human Resources Management (HRM)
Human Resources Management (HRM)
formal systems for the management of people within the organization
human resources have a strategic impact
create value
are rare
are difficult to imitate
are organized
human capital - the knowledge, skills, and abilities of employees that have economic value
the emphasis on different HR activities depends on whether the organization is growing, declining, or standing skill
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Strategic HRM (cont.) The HR planning process
a three-stage activity with a strategic purpose derived from the organization‘s plans
planning - determine the organization‘s plans
programming - create specific HR activities
evaluating - determine whether HR programs are producing the results needed to contribute to the organization
Demand forecasts - determine how many and what type of people are needed
derived from organizational plans
based on current sales and projected future sales growth
determine the demand for different types of workers
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An Overview Of The HR Planning Process
•Labor markets
•Technology
•Legislation
•Competition
•Economy
•Demand forecast
•Internal labor supply
•External labor supply
•Job analysis
HRM
environmental
scanning
Human
resources
planning
Organizational
strategic
planning
Planning
•Employee recruitment
•Employee selection
•Outplacement
•Training and
development
•Performance appraisal
•Reward systems
•Labor relations
Human
resources
activities
Programming
•Productivity
•Quality
•Innovation
•Satisfaction
•Turnover
•Absenteeism
•Health
Results
Evaluation
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Strategic HRM (cont.)
The HR planning process (cont.)
Labor supply forecasts - estimates of how many and what types of employees the organization actually will have
evaluate current employees and the available external supply of workers
forecasts of a diverse workforce have become fact
Reconciling supply and demand
labor deficit - hire new employees, promote current employees to new positions, or train other employees to move in from other areas in the organization
labor surplus - lay off employees or transfer them to other areas
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Strategic HRM (cont.)
The HR planning process (cont.)
Job analysis - a tool for determining what is done on a given job and what should be done on that job
job description - tells about the job itself
job specification - describes the employee characteristics needed to perform the job
provides the information that virtually every HR activity requires
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Staffing The Organization
Recruitment
the development of a pool of applicants for jobs in the organization
Internal recruiting
advantages - employers know their employees
employees know their organization
provides opportunity to move up within the organization
drawbacks - yields limited applicant pool
can inhibit a company that wants to change
job posting - a mechanism for advertising open positions
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Staffing The Organization (cont.)
Recruitment (cont.)
External recruiting - brings new blood into the organization
newspaper advertisements - popular recruiting source that is inexpensive and generates a large number of responses
employee referrals - some companies offer rewards for referrals
campus recruiting - large pool of people
applicants have up-to-date training
source of innovative ideas
Internet - becoming more common to advertise job openings and to gather applicant information
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3.84
3.81
3.71
3.08
3.05
2.86
2.78
1.92
1.64
Employee referrals
Executive search firms
Want ads
Private employment agencies
Unions
College recruiting
Professional associations
Direct applications
Public employment agencies
Effectiveness Of Recruitment Sources
Scale: 1 = not good, 3 = average, 5 = extremely good
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Staffing The Organization (cont.)
Selection
choosing from among qualified applicants to hire
Application and résumés - provide basic information to prospective employers
tend not to be useful for making final selection decisions
Interviews - most popular selection tool
questions that are not job related are prohibited
unstructured (nondirective) - interviewer asks different interviewees different questions
structured - interviewer asks all applicants the same questions
situational interview - focuses on hypothetical situations
behavioral description interview - explores applicant‘s past behavior
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Staffing The Organization (cont.)
Selection (cont.)
Reference checks - reference information is becoming increasingly difficult to obtain
Personality tests -may be difficult to defend in court
nonetheless, regaining popularity
Drug testing
Drug-Free Workplace Act of 1988
genetic testing - identifies the likelihood of contracting a disease
Cognitive ability tests - measure intellectual abilities
Performance tests - require performing a sample of the job
have been developed for almost every occupation
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Staffing The Organization (cont.)
Selection (cont.)
Assessment center - managerial performance test in which candidates participate in a variety of exercises and situations
taps a number of critical managerial dimensions
assessors generally are line managers from the organization
Integrity tests - assess a job candidate‘s honesty
polygraphs (lie detector tests) - banned for most employment purposes
paper-and-pencil tests - more recent tests of integrity
evidence of validity
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Staffing The Organization (cont.)
Selection (cont.)
Reliability - the consistency of test scores over time and across alternative measurements
Validity
criterion-related validity - degree to which a test actually predicts or correlates with job performance
reliance on scatterplots to depict the relationship between test scores and job performance
content validity - degree to which selection tests measure a representative sample of the knowledge, skills, and abilities required for the job
more subjective (less statistical) than criterion-related validity
not less important than criterion-related validity
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High Low Test score High
Low
Test score
High
Low
Per
form
an
ce
High
Low
Per
form
an
ce
Coefficient of correlation = .00 Coefficient of correlation = .75
Correlation Scatterplots
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Staffing The Organization (cont.)
Workforce reductions
Layoffs(downsizing) - laying off large numbers of employees as a result of restructuring in the industry
victims - lose self-esteem, suffer demoralizing job searches, and are stigmatized by being out of work
outplacement - process of helping people who have been dismissed to regain employment elsewhere
survivors - suffer disenchantment, distrust, and lethargy
a good performance appraisal process helps survivors avoid feeling that they retained their jobs due to arbitrary decision making
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Staffing The Organization (cont.)
Workforce reductions (cont.)
Termination - ―firing‖ an at-will employee
if the employee can quit for any reason, employer should be able to fire for any reason
courts in most states have made exceptions to this doctrine
public policy exceptions
progressive discipline - graduated steps used to correct workplace behavior
termination interview - stressful situation for all parties
used to discuss the company‘s position with the employee
often good to have a third party present
conduct the interview in a neutral location
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Staffing The Organization (cont.)
Legal issues and equal employment opportunity
Civil Rights Act of 1964
Title VII forbids discrimination in employment decisions based on race, sex, color, national origin, and religion
created the Equal Employment Opportunity Commission (EEOC) - enforces Title VII
Civil Rights Act of 1991 - provides for punitive damages
Uniform Guidelines on Employee Selection Procedures - describe the development of employment practices that comply with the law
adverse impact - an apparently neutral employment practice adversely affects a protected class
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Developing The Workforce Training and development
Training - teaching lower-level employees how to perform their present jobs
Developing - teaching managers and professional employees broad skills needed for their present and future jobs
Overview of the training process
phase one - needs assessment
identify the jobs, people, and departments which need training
phase two - design the training to meet training goals
phase three - decide what training methods to use
phase four - evaluate the training‘s effectiveness
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Developing The Workforce (cont)
Types of training
Orientation - training designed to introduce new employees to the company and familiarize them with policies, procedures, culture, and the like
benefits may include lower turnover, increased morale, higher productivity, and lower recruiting and training costs
Team training - provides employees with the skills and perspectives they need to work in collaboration with others
Diversity training - focuses on identifying and reducing hidden biases against people with differences and developing the skills needed to effectively manage a diversified workforce
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100
80
60
40
20
0
Perc
en
tage u
sin
g
Overall 10,000
or more
2,500-9,999 1,000-2,499 500-999 100-499
Number of employees
Classroom programs -
live
Videotapes
Videoconferencing
(individual desktops)
Outdoor experiential
programs
Satellite/
Broadcast TV
Videoconferencing
(to group)
Games/Simulations
(computer-based)
Internet/WWW
Selected Instructional Methods And Media
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Performance Appraisal Performance appraisal
the assessment of an employee‘s job performance
two basic purposes
administrative - provides information for making salary, promotion, and layoff decisions
developmental - diagnoses training needs and enables career planning
What do you appraise?
Trait appraisals - subjective judgments about employee performance
often leads to personal bias
may not be suitable for obtaining useful feedback
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Performance Appraisal (cont.) What do you appraise? (cont.)
Behavioral appraisals - focus on more observable aspects of performance
helps ensure that all parties understand what the ratings are really measuring
Results appraisals - tend to be more objective
focus on production data
Management By Objectives (MBO) - subordinate and supervisor agree on specific performance goals
develop a plan for attaining the goals
identify criteria for determining whether goals have been reached
useful when managers want to empower employees
may focus on short-term achievement and ignore long-term goals
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Example Of BARS Used For Evaluating Quality
Uses measures of quality and well-defined
processes to achieve project goals.
Defines quality from the client’s perspective.
Look for/identifies ways to continually improve the process.
Clearly communicates quality management to others.
Develops a plan that defines how the team will participate in quality.
Appreciates TQM as an investment.
Has measures of quality that define tolerance levels.
Views quality as costly.
Legislates quality.
Focuses her/his concerns only on outputs and
deliverables, ignoring the underlying process.
Blames others for absence of quality.
Gives lip service only to quality concerns.
7
6
5
4
3
2
1
Outstanding
Average
Poor
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Guidelines For Choosing An Appraisal System
Evaluate on
specific
behaviors
Document
the process
carefully
Attend to
legal
considerations
Appraisal
System
Use job analysis
for performance
standards
Develop a formal
appeal process
Use more than
one rater where
possible
Communicate
performance
standards
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Performance Appraisal (cont.) Who should do the appraisal?
managers and supervisors - traditional source of appraisal information
peers and team members - best at identifying leadership potential and interpersonal skills
subordinates - provide feedback to supervisors
internal and external customers
internal customers include anyone inside the organization who depends upon an employee‘s work output
self-appraisals - increases worker‘s involvement in appraisal
360 degree appraisal - uses multiple sources to gain comprehensive perspective of one‘s performance
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Performance Appraisal (cont.)
How do you give employees feedback?
performance feedback is a stressful task for all parties
most difficult interviews are with employees who are performing poorly
no ―one best way‖ to perform the appraisal interview
follow-up meetings may be necessary
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Designing Reward Systems Pay decisions
effective reward systems attract, motivate, and retain people
three types of decisions are crucial
pay level - choice of whether to be a high-, average-, or low-paying company
pay structure - choice of how to price different jobs within the organization
jobs similar in worth are grouped into families
individual pay decisions - concern different pay rates for jobs of similar worth within the same family
decisions based on:
seniority
performance
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Factors Affecting The Wage Mix
Wage
Mix
Internal factors External factors
Compensation policy
of organization
Employer’s ability to pay
Employee’s
relative worth
Worth of job
Conditions of the
labor market
Area wage rates
Cost of living
Collective bargaining
Legal requirements
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Pay Structure
Range
150 500 450 400 350 300 250 200
Job worth (total points)
Range overlap
Range steps
Midpoint 4.50
8.00
7.50
7.00
6.50
6.00
5.50
5.00
Wage
rate
s
Maximum rate
Wage curve
Minimum rate
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Designing Reward Systems (cont.)
Incentive systems and variable pay
individual incentive plans - most common type
consists of an objective standard against which a worker‘s performance is compared
group incentive plans
gainsharing - concentrate on saving money
profit-sharing - incentives based on unit, department, plant, or company productivity
each group has a production standard
pay is based on the amount of production over the standard
merit pay system - used in the absence of an objective standard
bonuses based on supervisor‘s judgment of employee‘s merit
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Designing Reward Systems (cont.)
Employee benefits
benefits required by law
workers’ compensation - provides financial support to employees suffering from a work-related injury or illness
social security - provides financial support to retirees
also covers disabled employees
unemployment insurance - provides financial support to employees who are laid off for reasons beyond their control
benefits not required by law
cafeteria benefit plan - employees choose from a menu of options to create a benefit package tailored to their needs
flexible benefit plan - employees are given credits to spend on benefits that fit their unique needs
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Designing Reward Systems (cont.)
Legal issues in compensation and benefits
Fair Labor Standards Act (FLSA) of 1938 - set minimum wages, maximum hours, child labor standards, and overtime pay provisions
nonexempt employees - entitled to premium pay for overtime
exempt employees - not subject to overtime or minimum wage provisions
Equal Pay Act (EPA) of 1963 - prohibits unequal pay for men and women who perform equal work
exceptions permitted where pay differential is based on seniority, a merit system, or an incentive system
comparable worth - principle of equal pay for different jobs of equal worth
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Designing Reward Systems (cont.)
Health and safety
Occupational Safety and Health Act (OSHA) of 1970 - requires employers to pursue workplace safety
employers must maintain records of injuries and deaths caused by workplace accidents
employers must submit to work-site inspections
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Labor Relations
Labor relations
system of relations between workers and management
Labor laws
National Labor Relations Act (NLRA) - Wagner Act declared labor organizations legal
established five unfair employer labor practices
created the National Labor Relations Board
conducts certification elections
hears unfair labor practices complaints
issues injunctions against offending employers
greatly assisted the growth of unions
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Labor laws (cont.)
Labor-Management Relations Act - Taft-Hartley Act intended to restore the balance of power between unions and management
protected employers‘ free-speech rights
defined unfair labor practices by unions
permitted workers to decertify unions
Labor-Management Reporting and Disclosure Act - Landrum-Griffin Act designed to curb abuses by union leadership and rid unions of corruption
declared a bill of rights for union members
Labor Relations (cont.)
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Unionization
authorization cards - collected by union locals to determine whether workers want to be represented for the purpose of collective bargaining
NLRB will conduct certification elections if union has collected cards from 30 percent of the bargaining unit
simple majority of those voting required to determine a winner
if union wins, it is certified as the bargaining unit representative
union and management obliged to negotiate in good faith to obtain a collective bargain agreement
Labor Relations (cont.)
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Determinants Of Union Voting Behavior
Union image •Corrupt?
•Too powerful?
•Unnecessary given
•current legislation
Job attitudes •Job dissatisfaction
•Unfair supervision
•Poor communication
Union vote:
Yes
or
No
Beliefs in union power
•Wages
•Power
•Working conditions
Economic needs •Wages
•Hours
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Labor Relations (cont.) Collective bargaining
to reach an agreement, workers may conduct an economic strike
arbitration - use of a neutral third party to resolve a labor dispute
used to deal with disagreements about interpretation of the contract
avoids wildcat strikes in which workers walk off the job in violation of the contract
union shop - union security clause specifying that workers must join the union after a set period of time on the job
right to work - state legislation that prohibits the negotiation of union shop clauses
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Chapter 8
Managing Human Resources and Labor Relations
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―Whenever you are asked if you can do a job, tell 'em, ‗Certainly, I can!‘ Then get busy and find out how to do it.‖ —Theodore Roosevelt
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Key Topics
Human resource management
Staffing, developing, and evaluating human resources
Compensation packages
Legal issues in human resources
Changes in the contemporary workplace
Unionization and collective bargaining
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Human Resource Management
Attracting, developing, and maintaining an effective workforce—A critical, bottom-line function!
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Job Analysis: Systematic Review of Jobs Within a Firm
Job Description
Responsibilities and working conditions, plus tools, materials and equipment to perform the job
Job Specification
Skills, abilities, and credentials needed to perform
the job
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Forecasting Labor Supply
Internal Forecasting:
Replacement Charts
Skills Inventories
External Forecasting:
State Employment Commissions
Government Reports
College Information
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Managing a Projected Shortfall
Hire new employees
Consider hiring temporary workers
Retrain and transfer current employees into understaffed areas
Convince older workers not to retire The creative solution:
Develop and install productivity
enhancing systems
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Recruiting: Attracting Qualified Candidates to Apply for a Job
Internal Recruiting
Considering current employees for new positions
External Recruiting
Attracting outside candidates to apply for jobs
What are the strengths and
weaknesses of each
approach?
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Selecting Human Resources
Application Forms
Tests
Interviews
Validity
The predictive value of a selection technique
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Developing the Workforce
Training
On-the-job training
Off-the-job training
Vestibule training
Performance Appraisal
Evaluating job performance
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Incentive Programs
Money linked specifically to high performance
Bonuses
Incentives
Compensation and Benefits
Wages
Money paid for time worked
Salary
Money paid for accomplishing a specific job
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Benefits: Compensation Other Than Wages and Salaries
Optional Benefits
Retirement plans
Health, life, and disability insurance
Vacations and holidays
Counseling services
Mandatory Benefits
Social security
Workers’ compensation
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Equal Opportunity: Unfair Discrimination Is Illegal
Equal Opportunity Laws
Protect workers from discrimination based on prejudice
Protected Class
People with common characteristics as indicated by law
EEOC
Federal agency that enforces discrimination-related laws
Affirmative Action
Plan to hire and develop members of protected classes
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Contemporary Legal Issues in Human Resource Management
Employee safety and health
AIDs in the workplace
Sexual harassment
Quid pro quo
Hostile work environment
Employment-at-will
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Managing Knowledge Workers
Knowledge workers add value because of what they know.
Computer Scientists
Physical Scientists
Engineers
Hiring and retaining knowledge workers is a
critical HR challenge
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Developing a Management Strategy
Assessing True Costs
Understanding Pros and Cons
Contingent Workers: A Rapidly Growing Trend
Management challenges: Careful Planning
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Labor Relations
Managing unionized employees
Managing Organized Labor
Labor Union
People working together to achieve shared job-related goals
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Trends in Organized Labor
Union-Management
Relations Bargaining
Perspectives
Future Outlook
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Contract Issues
Compensation
Benefits
Job Security
Other Union Issues
Management Rights
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When Bargaining Fails…
Union Tactics:
Strike
Picketing
Boycott
Work slowdown
Management Tactics:
Lockouts
Strikebreakers
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Mediation
Voluntary Arbitration
Compulsory Arbitration
Resolving Disputes
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Chapter Review
Define human resource management
Discuss staffing, developing human resources, and evaluating performance
Describe the role of compensation in attracting and keeping skilled workers
Identify the key legal issues surrounding human resource management
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Chapter Review (cont‘d)
Discuss important changes in the contemporary workplace
Explain why workers unionize and discuss the collective bargaining process