Chapter 7 Human Resource Management Human Resource Management

Chapter 7 Human Resource Management

Human Resource Management Ø Human Resource Management includes all activities used to attract and retain employees and to ensure they perform at a high level in meeting organizational goals. Ø These activities are made up of: 1. Recruitment and selection. 2. Training and development. 3. Performance evaluation and feedback. 4. Pay and benefits. 5. Labor relations.

Components of a HRM System Recruitment & Selection work Relations Pay & Rewards Training & Development Performance evaluation & Feedback

HRM Functions Ø HRM Functions should be consistent with the others, organization structure, and strategy. Main functions are: 1. Recruitment and Selection : Used to attract and hire new employees who have the abilities, skills, and experiences that will help an organization achieve its goals. 2. Training & Development: – Ensures that organizational members develop the skills and abilities that will enable them to perform their jobs effectively in the present and the future – Changes in technology and the environment require that organizational members learn new techniques and ways of working

HRM Functions 3. Performance Appraisal and feedback: – Provides managers with the information they need to make good human resources decisions about how to train, motivate, and reward organizational members – Feedback from performance appraisal serves a developmental purpose for members of an organization 4. Pay and Benefits: Ø high performing employees should be rewarded with salaries raises, bonuses. – Increased pay provides additional motivation. – Benefits, such as health insurance, reward membership in firm.

HRM Functions HRM Components 5. Labor relations: Ø Managers need an effective relationship with work unions that represent workers. – Unions help establish pay, and working conditions. Ø If management moves to a decentralized structure, HRM should be adjusted as well.

1. 1 Recruitment 1. External recruiting: managers look outside the firm for people who have not worked at the firm before. Ø 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. 2. Internal Recruiting: positions filled within the firm. Ø 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.

1. 2. Selection Process Ø After a pool of applicants are identified, qualifications related to the job requirements are determined: 1. Background Information: includes education, prior employment, college major, etc. 2. 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. 3. Physical Ability Test: measure strength & endurance. – Good for physically demanding jobs.

1. 2. Selection Process 4. 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. 5. 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. 6. References: outside people provide honest information about candidate. – Can be hard to get accurate information.

Selection Tools Background Information Interviews References Selection Performance tests Paper tests Physical Ability tests

2. Training & Development Ø Ø 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. – An Assessment should be taken first to determine who needs which program and what topics should be stressed.

Types of Training Needs Assessment Training Classroom Instruction On-the-job Training Apprenticeships Development Classroom Instruction On-the-job Training Varied work experiences Formal Education

Types of Training 1. Classroom Instruction: workers acquire skills in classroom. Ø Includes use of videos, role-playing, . 2. 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. 3. Apprenticeships: worker engages with a leading worker to learn a skill.

3. Performance Appraisal and Feedback • Performance Appraisal: – The evaluation of employees’ job performance and contributions to their organization. • Performance Feedback: – The process through which managers share performance appraisal information, give subordinates an opportunity to reflect on their own performance, and develop with subordinates, plans for the future.

3. 1 Types of Performance Appraisal 1. Trait Appraisals: – Assessing subordinates on personal characteristics that are relevant to job performance. – Disadvantages of trait appraisals: • Employees with a particular trait may choose not to use that particular trait on the job. • Traits and performance are not always obviously linked • It is difficult to give feedback on traits.

3. 1. Types of Performance Appraisal 2. Behavior Appraisals: Assesses how a worker does the job. – Focuses on what a worker does and provides good feedback options. 3. Results appraisals: Assessments based on what a worker achieves. – Sales reps are usually evaluated on what they sell. 4. Objective appraisals: – Assesses performance based on facts (e. g. , sales figures).

Who Appraises Performance? Supervisors Peers Sources of performance appraisals Self Customers & Clients Subordinates

3. 2 Effective Feedback Guidelines 1. Be specific and focus on correct 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.

4. Pay and Benefits • Pay: – Includes employees’ base salaries, pay raises, and bonuses – Determined by characteristics of the organization and the job and levels of performance – Benefits are based on membership in an organization

4. Pay and Benefits • Pay level: – The relative position of an organization’s incentives in comparison with those of other firms in the same industry employing similar kinds of workers • Managers can decide to offer low, average or high relative salaries. • High salaries attract and retain high performers but raise costs; low salaries can cause turnover and lack of motivation but provide lower costs.

5. Labor Relations Ø Labor – Relations: Considers all activities managers perform to ensure there is a good relationship with labor unions. Ø Unions: § § Represent worker’s interests to management in organizations. The power that a manager has over an individual worker causes workers to join together in unions to try to prevent this.