Principles of HRM
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1
Principles of
HR Management
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Training Agenda
1. HR Management : An Overview
2. HR Planning and Recruitment
3. Employee Selection
4. Training and Development
5. Performance Management
6. Career Management
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Human Resource
Management : An Overview
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HR Management Cycle
Recruitment &
Selection
Training &
Development
Performance
Management
Reward
Management
Career
Management
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HR Strategy and Business Result
Recruitment &
Selection
Training &
Development
Performance
Management
Reward
Management
Career
Management
HR
STRATEGY
Business
Strategy
Business
Result
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Manpower Planning &
Employee Recruitment
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Manpower Planning
Company Strategy
What staff do we
need to do the
job?
What staff is
available within
our
organization?
Is there a
match?
If not, what type of people
do we need, and how
should we recruit them?
Job Analysis
• Performance
appraisal
• Company data
banks
• Training
• Employee
management and
developmentWhat is impact
on wage and
salary program?
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Manpower Planning
The financial
resources
available to
your
organization
Factors in Forecasting Personnel
Requirements
Projected
turnover (as a
result of
resignation and
terminations)
Quality and nature of
your employees (in
relation to what you
see as the changing
need of your
organization)
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Technique to Determine Number of Recruits
• Study of a firm’s past employment needs
over a period of years to predict future
needs
Trend
Analysis
Ratio
Analysis
• A forecasting technique for
determining future staff needs by using
ratios between sales volume and
number of employees needed
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Recruitment from External Resources
• Recruiting new staff from external sources will be influenced
by several factors, namely :
When the economic conditions are
relatively difficult, there will usually be
an oversupply, or the number of
applicants will much higher than the
demand. In such a case, the company
will find it relatively easier to select new
employees from the large number of
applicants.
Macro-
Economic
Conditions
of a Nation
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When the sector is one that is
considered a ‘rare’ sector, the company
will have more difficulty in recruiting
staff for this sector. For example,
computer technology, or cellular
engineering.
Availability
of Manpower
in Desired
Sectors
Recruitment from External Resources
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It will tend to be easier for a company
to find and recruit the best people if
the company has a good reputation,
therefore the best fresh graduates will
flock to apply to the company.
Example : Google, McKinsey or
Microsoft.
Company
Reputation
Recruitment from External Resources
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• Some employers use a recruiting yield pyramid to
determine the number of applicants they must generate
to hire the required number of new employees.
• Example of Recruitment Curve:
• 1200 - Leads generated
• 200 - Candidates invited
• 150 - Candidates interviewed
• 100 - Offers made
• 50 - New hires
Recruitment Yield Pyramid
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Recruitment Sources
Advertising (newspaper,
magazine, internet)
College
Recruitment
Recruitment Agent
(headhunter)
Recruitment
Sources
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Employee Selection
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Basic Concept of Selection Tests
The quality of an employee selection test is determined by
three main factors, namely :
1. Criterion Validity : A type of validity based on showing
that scores on the test (“predictors”) are related to job
performance (“criterion”).
2. Content Validity : A test that is “content valid” is one in
which the test contains a fair sample of the tasks and
skills actually needed for the job in question.
3. Reliability : The consistency of scores obtained by the
same person when retested with identical or equivalent
test.
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Some Types of Selection Test
1. Cognitive Ability Test
2. Personality Test
3. Interview
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Cognitive Ability Test
• Cognitive Abilities Tests: Paper and pencil or
individualized assessment measures of an
individual's general mental ability or intelligence.
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Advantages of Cognitive Ability Test
• highly reliable
• verbal reasoning and numerical tests have shown high
validity for a wide range of jobs
• the validity rises with increasing complexity of the job
• may be administered in group settings where many
applicants can be tested at the same time
• scoring of the tests may be completed by computer
scanning equipment
• lower cost than personality tests
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Disadvantages of Cognitive Ability Test
• non-minorities typically score one standard deviation
above minorities which may result in adverse impact
depending on how the scores are used in the selection
process
• differences between males and females in abilities (e.g.,
knowledge of mathematics) may negatively impact the
scores of female applicants
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Personality Test
• Personality Tests: A selection procedure measure the
personality characteristics of applicants that are
related to future job performance.
• Personality tests typically measure one or more of
five personality dimensions: extroversion,
emotional stability, agreeableness,
conscientiousness, and openness to experience.
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Advantages of Personality Test
• can result in lower turnover due if applicants are
selected for traits that are highly correlated with
employees who have high longevity within the
organization
• can reveal more information about applicant's abilities
and interests
• can identify interpersonal traits that may be needed for
certain jobs
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Disadvantages of Personality Test
• difficult to measure personality traits that may not be well
defined
• responses by applicant may be altered by applicant's
desire to respond in a way they feel would result in their
selection
• lack of diversity if all selected applicants have same
personality traits
• lack of evidence to support validity of use of personality
tests
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Interview
• Interviews: A selection procedure designed to predict
future job performance on the basis of applicants'
oral responses to oral inquiries.
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Advantages of Interview
• useful for determining if the applicant has requisite
communicative or social skills which may be necessary for
the job
• can assess the applicant's job knowledge
• can be used for selection among equally qualified
applicants
• enables the supervisor and/or co-workers to determine if
there is compatibility between the applicant and the
employees
• allows the applicant to ask questions that may reveal
additional information useful for making a selection
decision
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Disadvantages of Interview
• subjective evaluations are made
• decisions tend to be made within the first few minutes of
the interview with the remainder of the interview used to
validate or justify the original decision
• interviewers form stereotypes concerning the
characteristics required for success on the job
• research has shown disproportionate rates of selection
between minority and non-minority members using
interviews
• negative information seems to be given more weight
• not as reliable as tests
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Training & Development
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Training
Need
Analysis
Training
ObjectivesTraining
Delivery
Training
Evaluation
Training Process
What are
the training
needs for
this person
and/or job?
Objective
should be
measurable
and
observable
Techniques
include on-
the-job-
training,
action
learning, etc.
Measure
reaction,
learning,
behavior,
and results
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Assessing Training Needs
Task Analysis A detailed analysis of a job to
identify the skills required, so
that an appropriate training
program can be instituted
Competency
Analysis
Careful study of competency level
to identify a deficiency and then
correct it with a training program, or
some other development
intervention.
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Competency Analysis
Required
competency
level for certain
position
Competency
Gap
Competency
Assessment
Current
competency
level of the
employee
Training and
Development
Program
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Competency Profile Per Position
1 2 3 4 5
Communication Skills
Public Speaking
Leadership
Training Need Analysis
Material Development
Training Evaluation
Communication Skills
Interview Skills
Analytical Thinking
Understand Selection Tools
Teamwork
Customer Orientation
Recruitment
Supervisor
Required Level
Required CompetencyPosition
Training &
Development
Manager
Score Required
Competency Type
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Position
Competency Requirements
Relevant Training Modules
Leadership
Leadership I
Communication Skills I
The Art of Motivating Employees
Providing Effective Feedback
SUPERVISOR
Achievement Orientation
Goal Setting Technique
Work Motivation
Planning & Organizing
Continuous Self Improevement
Managerial competency 1 2 3 4
Leadership Required Level
Actual Level
Achievement Orientation
Teamwork
Planning & Organizing
Functional competency 1 2 3 4
Mechanical Engineering
Mechanical Equipment Maintenance
Competency Profile Per Position
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Training Matrix for Competency Development
Communication Skills V
Leadership V
Teamwork V
Achievement Orientation V
Customer Focus V
Job Functional Skills V
Communication Skills V
Leadership V
Teamwork V
Achievement Orientation V
Customer Focus V
Strategic Thinking V
Problem Solving & Decision Making V
Job Functional Skills V
Position Managerial Competency
Supervisor
Manager
Pro
ductive
Com
munic
ation
Series
On B
ecom
ing
Eff
ective L
eader
1
On B
ecom
ing
Eff
ective L
eader
2
Serv
ice E
xcelle
nce
for
Custo
mer
Pro
fessio
nal
Sem
inar
Series
Achie
vem
ent
Motivation T
rain
ing
Cre
ative P
roble
m
Solv
ing
Str
ate
gic
Managem
ent
Build
ing P
roductive
Team
work
V = compulsory training
Training Title
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Enhance Training Effectiveness
Make the
material
meaningful
Provide for
transfer to
learning
Motivate
the trainee
Training
Effectiveness
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Enhance Training Effectiveness
Make the
material
meaningful
• At the start of training, provide the
trainees with a bird’s-eye view of the
material to be presented. Knowing the
overall picture facilitates learning.
• Use a variety of familiar examples when
presenting material
• Organize the material so that it is
presented in a logical manner and in
meaningful units
• Try to use terms and concepts that are
already familiar to trainees
• Use as many visual aids as possible
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Enhance Training Effectiveness
Provide for
transfer to
learning
• Maximize similarity between the training
situation and the work situation
• Provide adequate training practice
• Identify each feature of the step in the
process
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Enhance Training Effectiveness
Motivate
the trainee
• People learn best by doing. Try to
provide as much realistic practice as
possible
• Trainees learn best when correct
response on their part are immediately
reinforced.
• Trainees learn best when they learn at
their own pace. If possible, let trainees
pace themselves.
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Type of Training Program
Formal course
OFF THE JOB
Simulation
Wilderness Trip
• Does not interfere with job
• Provides for fact learning
• Helps transfer of learning
• Creates lifelike situations
• Builds teams
• Builds self-esteem
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Type of Training Program
Job instruction
training
ON THE JOB
Apprenticeship
training
Job rotation
Mentoring
• Facilitates transfer of learning
• Does not require separate facilities
• Does not interfere with real job performance
• Provides extensive training
• Gives exposure to many jobs
• Allows real learning
• Is informal
• Is integrated into job
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Evaluation of Training Effectiveness
Level 1 - Reaction
Level 2 - Learning
Level 3 – Behavior
Application
Level 4 – Business
Impact
Four Levels
of Training
Effectiveness
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Evaluation of Training Effectiveness
Test the trainees to determine if
they learned the principles,
skills, and facts they were to
learn.
Evaluate trainees’ reactions to
the program. Did they like the
program? Did they think it
worthwhile?
Level 1 -
Reaction
Level 2 -
Learning
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Evaluation of Training Effectiveness
What final results were achieved in terms of the
training objectives previously set? Did the number
of customer complaints about employee drop? Did
the reject rate improve? Was turnover reduced,
and so forth.
Ask whether the trainees’ behavior on the job
changed because of the training program. For
example, are employees in the store’s complaint
department more courteous toward disgruntled
customers than previously?
Level 3 –
Behavior
Application
Level 4 –
Business
Impact
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Employee
Performance Management
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Why Performance Appraisal?
• Appraisal provide information upon which promotion and
salary decision can be made.
• Appraisal provide an opportunity for a manager and
his/her subordinates to sit down and review the
subordinate’s work-related behavior, and then develop a
plan for corrective action.
• Appraisal provide a good opportunity to review the
person’s career plans in light of his/her exhibited
strengths and weaknesses.
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Performance Management Cycle
Performance
Planning
(Setting
Performance
Targets)
Regular
Review and
Monitoring
Feed back
Corrective
Action
Performance
Appraisal and
Evaluation
• Training &
Development
Plan
• Salary/Bonus
Adjustment
• Career
Development
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Performance Management Cycle
Defining
Performance
Standard/
Targets
Appraising
Performance
Providing
Feedback for
Development
1. Defining the performance standards
means making sure that you and your
subordinate agree on his/her duties and
targets that you expect
2. Appraising performance means
comparing your subordinate’s actual
performance to the standard/targets set
in step one.
3. Providing feedback means discussing
plans for any development that is
required.
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Problems in Performance Appraisal
Lack of
standards
Irrelevant or
subjective
standards
Poor
measures of
performance
Poor
feedback to
employee
Negative
communication
Failure to
apply
evaluation
data
Common Performance Evaluation Problems
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Bias in the Appraisal Process
Halo
Effect
The "halo" effect occurs when a supervisor’s
rating of a subordinates on one trait biases the
rating of that person on other traits
Central
Tendency
A tendency to rate all employees the same
way, such as rating them all average
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Leniency
The problem that occurs when a supervisory
has a tendency to rate all subordinates either
high or low
BiasThe tendency to allow individual differences
such as age, race, and sec affect the appraisal
rates these employees receives.
Bias in the Appraisal Process
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Performance
appraisal
elements
has two main
categories: 2. Performance Result:
Hard or quantitative aspects
of performance (result)
1. Competencies: It
represents soft or qualitative
aspects of performance
(process)
Performance Appraisal Element
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1. Competencies Score
2. Performance Result
Score
Overall Score
Will determine the employee’s
career movement, and also
the reward to be earned
Performance Appraisal Element
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Element # 1 : Competencies
Basic Intermediate Advanced Expert
Actively listens, and clarifies
understanding where required, in
order to learn from others.
Actively listens, and clarifies
understanding where required, in
order to learn from others.
Actively listens, and clarifies
understanding where required, in
order to learn from others.
Actively listens, and clarifies understanding
where required, in order to learn from others.
Empathise with audience and
formulates messages accordingly.
Empathise with audience and
formulates messages accordingly.
Empathise with audience and
formulates messages accordingly.
Empathise with audience and formulates
messages accordingly.
Shares resources and information. Shares resources and information. Shares resources and information. Shares resources and information.
Responds promptly to other team
members’ needs.
Balances complementary strengths
in teams and seeks diverse
contributions and perspectives.
Actively builds internal and external
networks.
Builds internal and external networks and uses
them to efficiently to create value.
Involves teams in decisions that
effect them.
Uses cross functional teams to draw
upon skills and knowledge
throughout the organization.
Uses cross functional teams to draw upon
skills and knowledge throughout the
organization.
Encourages co-operation rather than
competition within the team and with
key stakeholders.
Builds and maintains relationships
across The company.
Drives and leads key relationship groups
across The company.
Manages alliance relationships through
complex issues such as points of competing
interest.
Ensures events and systems, eg IT, for
collaboration are in place and used.
Draws upon the full range of relationships
(internal, external, cross The company) at
critical points in marketing and negotiations.
Competency : Collaboration
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No. Main Performance Target Target to be
Achieved
1 Conduct an assessment of the All employees submit their performance assessment form
employee's performance on time
2 Improve the system for Target : completed 100 %
performance assessment in November 2008
3 Conduct training activities Target : to conduct 6 training modules
in one year
4 Carry out on the job training Target : 90 % of the total employees
activities who attend the training
experience an increase
in skill and knowledge
Element # 2 : Performance Results
Target should be measurable and
specific
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Employee Career
Management
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Career Planning and Development
Providing employees
the assistance to form
realistic career goals
and the opportunities
to realize them
Career
Planning &
Development
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Entry Level
First Line
Middle
Management
Senior
Management
Top
Management
Join Company 22 years old
Supervisor/Ass. Manager 26 - 29 years old
Managers 29 - 35 years old
GM/Senior Managers 35 - 45 years old
CEO/BOD 45 - 55 years old
Typical Career movement
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Career Stage
Trial Stage The period from about age 25 to 30 during
which the person determines whether or
not the chosen field is suitable and if it is
not, attempts to change it.
Stabilization
Stage
The period, roughly from age 30 to 40,
during which occupational goals are set
and more explicit career planning is made
to determine the sequence for
accomplishing goals
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Mid career
Crisis Stage
The period occurring between the mid-
thirties and mid-forties during which people
often make a major reassessment of their
progress relative to their original career
ambitions and goals
Maintenance
Stage
The period form about ages 45 to 65 during
which the person secures his or her place
in the world of work
Career Stage
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Decline Stage The period during which many people are
faced with the prospect of having to accept
reduced levels of power and responsibility.
Career Stage
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Career Anchors
Career Anchor :
A concern or value that someone will not give up if
choice has to be made
Career anchors, as their name implies, are the
pivots around which a person’s career swings; a
person becomes conscious of them as a result of
learning about his or her talents and abilities.
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Five Career Anchors
Technical/
Functional
Career Anchor
Managerial
Competence as a
Career Anchor
Creativity as a
Career Anchor
Autonomy and
Independence as
Career Anchor
Security as a
Career Anchor
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Five Career Anchors
Technical/
Functional
Career Anchor
• People who have a strong
technical/functional career anchor
tend to avoid decisions that would
drive them toward general
management.
• Instead, they make decisions that will
enable them to remain and grow in
their chosen technical or functional
field
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Five Career Anchors
Managerial
Competence
• People who show strong motivation
to become managers
• Their career experience enables
them to believe that they have the
skills and values necessary to rise to
such general management position
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Five Career Anchors
Creativity• People who go on to become
successful entrepreneurs
• These people seem to have a need
to build or create something that is
entirely their own product – a product
or process that bears their name, a
company of their own, or a personal
fortune that reflects their
accomplishments.
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Five Career Anchors
Autonomy and
Independence
• People who are driven by the need to
be on their own, free from the
dependence that can arise when a
person elects to work in a large
organization.
• Some of these people decide to
become consultants, working either
alone or as part of relatively small
firm. Others choose to become
professors, free-lance writers, or
proprietors of a small retail business.
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Five Career Anchors
Security• People who are mostly concern with
long-run career stability and job
security.
• They seem willing to do what is
required to maintain job security, a
decent income, and a stable future in
the form of a good retirement
program and benefits.
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Career Management and the First
Assignment
• Factors to keep in mind about the important first
assignment, include :
1. Avoid reality shock (reality shock refers to the result
of a period that may occur at the initial career entry
when the new employee’s high job expectations
confront the reality of boring, unchallenging jobs.
2. Provide challenging initial jobs
3. Provide realistic job preview in recruiting
4. Be demanding
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Career Management and the First
Assignment
5. Provide periodic job rotation
6. Provide career-oriented performance appraisals
7. Encourage career-planning activities
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Recommended Further Readings
1. Gary Dessler, Human resource Management, Prentice Hall
2. Susan Jackson and Randall Schuler, Managing Human Resource : A
Partnership Perspective, South-Western College Publishing
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End of Material