10-1
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Human
Resource
Management
10
10-2
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Human Resource Management
Human Resource Management includes all
activities used to attract & retain employees
and to ensure they perform at a high level in
meeting organizational goals,
These activities are made up of
1,Recruitment & selection,
2,Training and development,
3,Performance appraisal and feedback,
4,Pay and benefits,
5,Labor relations,
10-3
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Components of a HRM System
Recruitment
& Selection
Labor
Relations
Pay &
Rewards
Performance
Appraisal &
Feedback
Training &
Development
Figure 10.1
10-4
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
HRM Components
? Component should be consistent with the others,
organization structure,and strategy,
?Recruitment,develop a pool of qualified applicants,
? Selection,determine relative qualifications &
potential for a job,
?Training & Development,ongoing process to
develop worker’s abilities and skills,
?Performance appraisal & feedback,provides
information about how to train,motivate,and reward
workers,
? Managers can evaluate and then give feedback to
enhance worker performance,
10-5
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
HRM Components
?Pay and Benefits,high performing employees should be
rewarded with raises,bonuses,
? Increased pay provides additional incentive,
? Benefits,such as health insurance,reward membership in
firm,
?Labor relations,managers need an effective
relationship with labor unions that represent workers,
? Unions help establish pay,and working conditions,
If management moves to a decentralized
structure,HRM should be adjusted as well,
10-6
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
HRM Legal Environment
? Management of HR is a complex area,There are many
federal,state and local regulations,
?Equal Employment Opportunity (EEO),ensures all
citizens have equal opportunity for employment without
regard to sex,age,race,origin,religion,or disabilities,
? Makes effective management of diversity crucial,
?Equal Employment Opportunity Commission (EEOC)
enforces laws,
? Managers must take steps to ensure discrimination does
not occur,
10-7
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Human Resource Planning
?HR Planning includes all activities managers
do to forecast current and future HR needs,
? Must be done prior to recruitment and selection
? Demand forecasts made by managers estimate the
number & qualifications the firm will need,
? Supply forecasts estimate the availability and
qualifications of current workers and those in the labor
market,
10-8
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Recruitment & Selection
Human Resources
Planning Job Analysis
Determine recruitment
& selection needs
Figure 10.2
10-9
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
HRM Planning,Outsourcing
? Outsourcing,managers can decide to contract with
outside workers rather than hiring them,
? Outsourcing is more flexible for the firm,
? Outsourcing often provides human capital at a lower cost,
?Outsource problems,managers lose control over
output,
? Outsource contractors are not committed to the firm,
?Unions typically are against outsourcing that has
potential to eliminate member’s jobs,
10-10
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
HRM Planning,Job Analysis
? Job analysis determines the tasks,duties and
responsibilities of the job,
?A job analysis should be done for each job in the
organization,
?Job analysis can be done by,
? Observe current workers,
? Questionnaires filled out by worker and managers,
?Current trends are toward flexible jobs where duties are
not easily defined in advance,
10-11
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Recruitment
? External recruiting,managers look outside the firm for
people who have not worked at the firm before,
?Managers advertise in newspapers,hold open houses,
recruit at universities,and on the Internet,
? External recruitment is difficult since many new jobs have
specific skill needs,
? A multi-prong approach to external recruiting works best,
? Internal Recruiting,positions filled within the firm,
?Internal recruiting has several benefits,
? Workers know the firm’s culture,may not have new
ideas,
? Managers likely already know the candidates,
? Internal advancement can motivate employees,
10-12
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Honesty in Hiring
?Managers may be tempted to over-rate the
attractiveness of the job and firm,
? They feel if they are honest,person will not work there,
? Research indicates this is a poor strategy,
?Realistic Job Preview,provides an accurate
overview of the job,
? Avoids having to hire,train and then lose workers,
10-13
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Selection Tools
Background
Information
Interviews References
Paper tests
Physical
Ability tests
Performance tests
Selection
Figure 10.3
10-14
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Selection Process
After a pool of applicants are identified,qualifications
related to the job requirements are determined,
?Background Information,includes education,prior
employment,college major,etc,
?Interview,almost all firms use one of two types,
? Structured interview,managers ask each person the same
job-related questions,
? Unstructured interview,held like a normal conversation,
? Usually structured interviews preferred; bias is possible,
?Physical Ability Test,measure strength & endurance,
? Good for physically demanding jobs,
10-15
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Selection Process
? Paper & Pencil Tests,Either an ability and personality
test,
? Ability test,assess if applicant has right skills for the job,
? Personality test,seek traits relevant to job performance,
? Be sure test is a good predictor of job performance,
? Performance Tests,measure job performance,
? Typing speed test is one example,
? Assessment Center,candidates assessed on job-related
activities over a period of a few days,
? References,outside people provide candid
information about candidate,
? Can be hard to get accurate information,
10-16
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Reliability & Validity
? Selection tools must be reliable and valid,
?Reliability,the degree to which the tool measures the
same thing each time it is used,
? Scores should be close for the same person taking the
same test over time,
?Validity,Does the test measure what it is supposed to
measure?
? Example,does a physical ability test really predict the job
performance of a firefighter?
?Managers have an ethical and legal duty to develop
good selection tools,
10-17
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Training & Development
?Training,teach organizational members how to perform
current jobs,
? Help worker’s acquire skills to perform effectively,
?Development,build worker’s skills to enable them to
take on new duties,
? Training used more often at lower levels of firm,
development is common with managers,
? A Needs Assessment should be taken first to determine
who needs which program and what topics should be
stressed,
10-18
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Types of Training
Training Development
Apprentice-
ships
On-the-job
Training
Classroom
Instruction
On-the-job
Training
Classroom
Instruction
Formal
Education
Varied
work
experiences
Needs
Assessment
Figure 10.4
10-19
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Types of Training
? Classroom Instruction,workers acquire skills in
classroom,
?Includes use of videos,role-playing,simulations,
? On-the-Job Training,learning occurs in the work
setting as worker does the job,
? Training given by co-workers and can be done
continuously,
? Apprenticeships,worker contracts with a master
worker to learn a skill,
10-20
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Types of Development
? Varied Work Experiences,Top managers must build
expertise in many areas,
? Workers identified as possible top managers given many
different tasks,
? Formal Education,tuition reimbursement is common
for managers taking classes for MBA or similar,
? Long-distance learning can also be used to reduce travel,
Whatever training and development efforts
used,results must be transferred to the
workplace,
10-21
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Performance Appraisal & Feedback
? Trait Appraisals,evaluate on traits (skills,abilities)
related to the job,
? Problem,Even though a worker has the trait,they may
not use it in the job and it is hard to give feedback,
? Behavior Appraisals,how a worker does the job,
? Focuses on what a worker does and provides good
feedback options,
? Results appraisals,what a worker accomplishes,
? Sales reps are usually evaluated on what they sell,
? Objective appraisals,based on facts (sales figures)
? Subjective appraisals,based on a manager’s
perceptions of traits,behavior,or results,
? Many rating scales used to overcome subjective
problems,
10-22
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Who Appraises Performance?
Supervisors
Peers Customers &
Clients
Subordinates Self
Sources of
performance
appraisals
Figure 10.6
10-23
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Who Appraises Performance?
? Self,self appraisals can supplement manager view,
? Peer appraisal,coworker provides appraisal; common in
team settings,
? 360 Degree,provides appraisal from a variety of people
able to evaluate a manager,
?Peers,customers,superiors,self,
? Need to be alert to bias from some evaluators,
?Effective feedback,appraisals must provide feedback,
? Formal appraisals,conducted at set times of the year
? Provides valuable,but infrequent feedback,
? Informal appraisals,manager provides frequent
feedback informally,
10-24
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Effective Feedback,
1,Be specific and focus on correctable behavior,
Provide a suggested improvement,
2,Focus on problem-solving and improvement,not
criticism,
3,Express confidence in worker’s ability to
improve,
4,Use formal and informal feedback,
5,Treat subordinates with respect and praise
achievements,
6,Set a timetable for agreed changes,
10-25
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Pay and Benefits
? Pay level,how the firm’s pay incentives compare to
other firms in the industry,
? Managers can decide to offer low or high relative
wages,
?Pay Structure,clusters jobs into categories based on
importance,skills,and other issues,
? Benefits,Some are required (social security,workers
comp),
? Others (health insurance,day care,and others) are
provided at the employers option,
? Cafeteria-style plan,employee can choose the best mix
of benefits for them,Can be hard to manage,
10-26
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Labor Relations
? Considers all activities managers perform to ensure there
is a good relationship with labor unions,
?There are laws regulating some areas of
employment,
? Fair Labor Standards Act (1938) prohibits child
labor,sets a minimum wage and maximum working
hours,
? Equal Pay Act (1963) men and women doing equal
work will get equal pay,
? Work Place Safety (1970) OSHA mandates
procedures for safe working conditions,
10-27
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Unions
Unions represent worker’s interests in organizations,
?Managers usually have more power over an
individual worker,Workers join together in unions
to try and prevent this,
? Unions are permitted by the National Labor Relations
Act (1935) which also created the NLRB to oversee
unions,
? Not all workers want unions,Union membership costs
money in dues and a worker might not want to strike,
? Union membership is lower today than 40 years ago,
?Collective bargaining,process unions and
management go through to negotiate work
agreements,
? Results in a contract spelling out agreed terms,
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Human
Resource
Management
10
10-2
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Human Resource Management
Human Resource Management includes all
activities used to attract & retain employees
and to ensure they perform at a high level in
meeting organizational goals,
These activities are made up of
1,Recruitment & selection,
2,Training and development,
3,Performance appraisal and feedback,
4,Pay and benefits,
5,Labor relations,
10-3
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Components of a HRM System
Recruitment
& Selection
Labor
Relations
Pay &
Rewards
Performance
Appraisal &
Feedback
Training &
Development
Figure 10.1
10-4
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
HRM Components
? Component should be consistent with the others,
organization structure,and strategy,
?Recruitment,develop a pool of qualified applicants,
? Selection,determine relative qualifications &
potential for a job,
?Training & Development,ongoing process to
develop worker’s abilities and skills,
?Performance appraisal & feedback,provides
information about how to train,motivate,and reward
workers,
? Managers can evaluate and then give feedback to
enhance worker performance,
10-5
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
HRM Components
?Pay and Benefits,high performing employees should be
rewarded with raises,bonuses,
? Increased pay provides additional incentive,
? Benefits,such as health insurance,reward membership in
firm,
?Labor relations,managers need an effective
relationship with labor unions that represent workers,
? Unions help establish pay,and working conditions,
If management moves to a decentralized
structure,HRM should be adjusted as well,
10-6
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
HRM Legal Environment
? Management of HR is a complex area,There are many
federal,state and local regulations,
?Equal Employment Opportunity (EEO),ensures all
citizens have equal opportunity for employment without
regard to sex,age,race,origin,religion,or disabilities,
? Makes effective management of diversity crucial,
?Equal Employment Opportunity Commission (EEOC)
enforces laws,
? Managers must take steps to ensure discrimination does
not occur,
10-7
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Human Resource Planning
?HR Planning includes all activities managers
do to forecast current and future HR needs,
? Must be done prior to recruitment and selection
? Demand forecasts made by managers estimate the
number & qualifications the firm will need,
? Supply forecasts estimate the availability and
qualifications of current workers and those in the labor
market,
10-8
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Recruitment & Selection
Human Resources
Planning Job Analysis
Determine recruitment
& selection needs
Figure 10.2
10-9
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
HRM Planning,Outsourcing
? Outsourcing,managers can decide to contract with
outside workers rather than hiring them,
? Outsourcing is more flexible for the firm,
? Outsourcing often provides human capital at a lower cost,
?Outsource problems,managers lose control over
output,
? Outsource contractors are not committed to the firm,
?Unions typically are against outsourcing that has
potential to eliminate member’s jobs,
10-10
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
HRM Planning,Job Analysis
? Job analysis determines the tasks,duties and
responsibilities of the job,
?A job analysis should be done for each job in the
organization,
?Job analysis can be done by,
? Observe current workers,
? Questionnaires filled out by worker and managers,
?Current trends are toward flexible jobs where duties are
not easily defined in advance,
10-11
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Recruitment
? External recruiting,managers look outside the firm for
people who have not worked at the firm before,
?Managers advertise in newspapers,hold open houses,
recruit at universities,and on the Internet,
? External recruitment is difficult since many new jobs have
specific skill needs,
? A multi-prong approach to external recruiting works best,
? Internal Recruiting,positions filled within the firm,
?Internal recruiting has several benefits,
? Workers know the firm’s culture,may not have new
ideas,
? Managers likely already know the candidates,
? Internal advancement can motivate employees,
10-12
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Honesty in Hiring
?Managers may be tempted to over-rate the
attractiveness of the job and firm,
? They feel if they are honest,person will not work there,
? Research indicates this is a poor strategy,
?Realistic Job Preview,provides an accurate
overview of the job,
? Avoids having to hire,train and then lose workers,
10-13
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Selection Tools
Background
Information
Interviews References
Paper tests
Physical
Ability tests
Performance tests
Selection
Figure 10.3
10-14
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Selection Process
After a pool of applicants are identified,qualifications
related to the job requirements are determined,
?Background Information,includes education,prior
employment,college major,etc,
?Interview,almost all firms use one of two types,
? Structured interview,managers ask each person the same
job-related questions,
? Unstructured interview,held like a normal conversation,
? Usually structured interviews preferred; bias is possible,
?Physical Ability Test,measure strength & endurance,
? Good for physically demanding jobs,
10-15
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Selection Process
? Paper & Pencil Tests,Either an ability and personality
test,
? Ability test,assess if applicant has right skills for the job,
? Personality test,seek traits relevant to job performance,
? Be sure test is a good predictor of job performance,
? Performance Tests,measure job performance,
? Typing speed test is one example,
? Assessment Center,candidates assessed on job-related
activities over a period of a few days,
? References,outside people provide candid
information about candidate,
? Can be hard to get accurate information,
10-16
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Reliability & Validity
? Selection tools must be reliable and valid,
?Reliability,the degree to which the tool measures the
same thing each time it is used,
? Scores should be close for the same person taking the
same test over time,
?Validity,Does the test measure what it is supposed to
measure?
? Example,does a physical ability test really predict the job
performance of a firefighter?
?Managers have an ethical and legal duty to develop
good selection tools,
10-17
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Training & Development
?Training,teach organizational members how to perform
current jobs,
? Help worker’s acquire skills to perform effectively,
?Development,build worker’s skills to enable them to
take on new duties,
? Training used more often at lower levels of firm,
development is common with managers,
? A Needs Assessment should be taken first to determine
who needs which program and what topics should be
stressed,
10-18
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Types of Training
Training Development
Apprentice-
ships
On-the-job
Training
Classroom
Instruction
On-the-job
Training
Classroom
Instruction
Formal
Education
Varied
work
experiences
Needs
Assessment
Figure 10.4
10-19
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Types of Training
? Classroom Instruction,workers acquire skills in
classroom,
?Includes use of videos,role-playing,simulations,
? On-the-Job Training,learning occurs in the work
setting as worker does the job,
? Training given by co-workers and can be done
continuously,
? Apprenticeships,worker contracts with a master
worker to learn a skill,
10-20
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Types of Development
? Varied Work Experiences,Top managers must build
expertise in many areas,
? Workers identified as possible top managers given many
different tasks,
? Formal Education,tuition reimbursement is common
for managers taking classes for MBA or similar,
? Long-distance learning can also be used to reduce travel,
Whatever training and development efforts
used,results must be transferred to the
workplace,
10-21
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Performance Appraisal & Feedback
? Trait Appraisals,evaluate on traits (skills,abilities)
related to the job,
? Problem,Even though a worker has the trait,they may
not use it in the job and it is hard to give feedback,
? Behavior Appraisals,how a worker does the job,
? Focuses on what a worker does and provides good
feedback options,
? Results appraisals,what a worker accomplishes,
? Sales reps are usually evaluated on what they sell,
? Objective appraisals,based on facts (sales figures)
? Subjective appraisals,based on a manager’s
perceptions of traits,behavior,or results,
? Many rating scales used to overcome subjective
problems,
10-22
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Who Appraises Performance?
Supervisors
Peers Customers &
Clients
Subordinates Self
Sources of
performance
appraisals
Figure 10.6
10-23
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Who Appraises Performance?
? Self,self appraisals can supplement manager view,
? Peer appraisal,coworker provides appraisal; common in
team settings,
? 360 Degree,provides appraisal from a variety of people
able to evaluate a manager,
?Peers,customers,superiors,self,
? Need to be alert to bias from some evaluators,
?Effective feedback,appraisals must provide feedback,
? Formal appraisals,conducted at set times of the year
? Provides valuable,but infrequent feedback,
? Informal appraisals,manager provides frequent
feedback informally,
10-24
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Effective Feedback,
1,Be specific and focus on correctable behavior,
Provide a suggested improvement,
2,Focus on problem-solving and improvement,not
criticism,
3,Express confidence in worker’s ability to
improve,
4,Use formal and informal feedback,
5,Treat subordinates with respect and praise
achievements,
6,Set a timetable for agreed changes,
10-25
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Pay and Benefits
? Pay level,how the firm’s pay incentives compare to
other firms in the industry,
? Managers can decide to offer low or high relative
wages,
?Pay Structure,clusters jobs into categories based on
importance,skills,and other issues,
? Benefits,Some are required (social security,workers
comp),
? Others (health insurance,day care,and others) are
provided at the employers option,
? Cafeteria-style plan,employee can choose the best mix
of benefits for them,Can be hard to manage,
10-26
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Labor Relations
? Considers all activities managers perform to ensure there
is a good relationship with labor unions,
?There are laws regulating some areas of
employment,
? Fair Labor Standards Act (1938) prohibits child
labor,sets a minimum wage and maximum working
hours,
? Equal Pay Act (1963) men and women doing equal
work will get equal pay,
? Work Place Safety (1970) OSHA mandates
procedures for safe working conditions,
10-27
Irwin/McGraw-Hill ?The McGraw-Hill Companies,Inc.,2000
Unions
Unions represent worker’s interests in organizations,
?Managers usually have more power over an
individual worker,Workers join together in unions
to try and prevent this,
? Unions are permitted by the National Labor Relations
Act (1935) which also created the NLRB to oversee
unions,
? Not all workers want unions,Union membership costs
money in dues and a worker might not want to strike,
? Union membership is lower today than 40 years ago,
?Collective bargaining,process unions and
management go through to negotiate work
agreements,
? Results in a contract spelling out agreed terms,
