HRM Lecture

HRM Lecture
Mr. D
When you finish studying this chapter, you should be

able to:
•Answer the question, “What is Human Resource
Management?”
•Discuss the components of the changing
environment of Human Resource Management.
•Present examples of the new management practices
that are changing Human Resource management.
•Give examples of human Resource management’s
role and motivation processes
Are you gonna hire this dude?
Attitude counts
Attitude counts
Attitude
counts
Attitude counts
Can be all about control
Is all about People Management
People Management
Human Resource Management
• The process of planning, organizing,

directing (motivating), and controlling the
procurement, development, compensation,
integration, maintenance, and separation of
organizational human resources to the end
that organizational, individual, and societal
needs are satisfied.
Objectives – Answering the questions:
 Why do people make the difference?

 What is strategic human resource management?
 How do organizations attract a quality workforce?
 How do organizations develop a quality
workforce?
 How do organizations maintain a quality
workforce?
11
Study Question 1: Why do people make
the difference?
Human capital is essential to any

organization’s long-term performance
success.
Organizations perform better when they
treat their employees better.
Human resources are key to organizational
success or failure.
Management - Chapter 12
12
Study Question 1: Why do people make
the difference?
 Building high performance work environments depends on

having people with the following qualities:
– Work ethic
– Ambition and energy
– Knowledge
– Creativity
– Motivation
– Sincerity
– Outlook
– Collegiality and collaborativeness
– Curiosity
– Judgment and maturity
– Integrity
13
‘EMPLOYEES ARE THE MOST IMPORTANT
ASSET OF THE ORGANIZATION’
• The quality and effectiveness of the

organization is determined by the
quality of the people that are employed.
• Success for most organizations

depends on finding the employees with
the skills to successfully perform the
tasks required to attain the company’s
strategic goals.
OBJECTIVES OF HRM
 It is concerned with the optimum utilization of

the human resources within and organization.
PERSONAL
 It is concerned with the creation of conditions
in which each employee is encouraged to
make his best possible contribution to the
effective working of the undertaking.
 It is also concerned with the development of
the sense of mutual respect and trust between
management and workers through sound
relations.
 It endeavors to increase the productive
efficiency to the workers through training,
guidance and counseling and
 It tries to raise the morale of the employee.
OBJECTIVES OF HRM
• To recognize the role of HRM in

bringing about organizational
ORGANIZATIONAL effectiveness.
• HRM is not an end itself. It is
only a means to assist the
organization with its primary
objectives.
• Simply stated, the department
exist to serve the rest of the
organization.
OBJECTIVES OF HRM
• To be ethically and socially responsible

to the needs and challenges of the
SOCIETAL society while minimizing the negative
impact of such demands upon the
organization.
• The failure of organizations to use their
resources for the society’s benefit in
ethical way may lead to restrictions.
• For example, the society may limit HR
decisions through laws that enforce
reservation in hiring and laws that
address discrimination, safety or other
such areas of social concern.
WHY IS HRM IMPORTANT?
• Service is delivered by people.
• Low quality HR leads to low quality

customer service.
• In the 21st century effective knowledge
management translates into competitive
advantage and profits.
• Knowledge comes from a firm’s people.
WHAT IS UNIQUE ABOUT HRM?
HR is multidisciplinary:
• It applies the disciplines of Economics
(wages, markets, resources), Psychology
(motivation, satisfaction), Sociology
(organization structure, culture) and Law.
• HR is embedded within the work of all

managers, and most individual
contributors due to the need of managing
people (subordinates, peers and
superiors) as well as teams to get things
HRM STAKEHOLDERS
• Society
• Organization/Owners
• Employee
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.
Study Question 2: What is strategic human
resource management?
 Major human resource management

responsibilities:
– Attracting a quality workforce
• Human resource planning, recruitment, and selection
– Developing a quality workforce
• Employee orientation, training and development, and
performance appraisal.
– Maintaining a quality workforce
• Career development, work-life balance, compensation and
benefits, employee retention and turnover, and labor-
management relations.
22
Study Question 2: What is strategic human
resource management?
 Discrimination in employment
– Occurs when someone is denied a job or job assignment
for reasons that are not job relevant.
 Employment equity
– An effort to give preference in employment to
Aboriginals, women, visible minorities, and people
with physical/mental disability.
– Bona fide occupational requirements are employment
criteria justified by the capacity to perform a job
23
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.
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.
Study Question 3: How do organizations
attract a quality workforce?
 The foundation of human resource planning is job

analysis.
– The orderly study of job facts to determine just what is
done, when, where, how, why, and by whom in existing
or potential new jobs.
 Job analysis provides information for developing:
– Job descriptions
– Job specifications
26
 Recruitment
– Activities designed to attract a qualified pool of
job applicants to an organization.
– Steps in the recruitment process:
• Advertisement of a job vacancy.
• Preliminary contact with potential job candidates.
• Initial screening to create a pool of qualified
applicants.
27
 Recruitment methods:
– External recruitment — candidates are sought from
outside the hiring organization.
– Internal recruitment — candidates are sought from
within the organization.
– Traditional recruitment — candidates receive
information only on most positive organizational
features.
– Realistic job previews — candidates receive all
pertinent information.
28
Selection Tools
Background
Information
Interviews References
Selection
Performance tests Paper tests

Physical
Ability tests
 Selection
– Choosing from a pool of applicants the person or
persons who offer the greatest performance potential.
 Selection Steps
– Completion of a formal application form.
– Interviewing.
– Testing.
– Reference checks.
– Physical examination.
– Final analysis and decision to hire or reject.
30
Figure 12.3 Steps in the selection
process: the case of a rejected job applicant.
31
Step 1—application forms

– Declares individual to be a job candidate.
– Documents applicant’s personal history and
qualifications.
– Personal résumés may be included.
– Applicants lacking appropriate credentials are
rejected at this step.
32
 Step 2—interviews
– Exchange of information between job candidate
and key members of the organization.
– Opportunity for job candidate and
organizational members to learn more about
each other.
33
 Step 3 — employment tests

– Used to further screen applicants by gathering
additional job-relevant information.
– Common types of employment tests:
• Intelligence
• Aptitude
• Personality
• Interests
34
Criteria for selection devices:

– Reliability
• The selection device is consistent in measurement.
– Validity
• There is a demonstrable relationship between a
person’s score or rating on a selection device and
his/her eventual job performance.
35
Behaviorally-oriented employment tests:

– Assessment center
• Evaluates a person’s performance in simulated work
situations.
– Work sampling
• Evaluates a person’s performance on actual job
tasks.
36
 Step 4 — reference and background checks

– Inquiries to previous employers, academic
advisors, coworkers and/or acquaintances
regarding applicant’s:
• Qualifications.
• Experience.
• Past work records.
– Can better inform potential employer.
– Can enhance candidate’s credibility.
37
 Step 5 — physical examinations

– Ensure applicant’s physical capability to fulfill
job requirements.
– Basis for enrolling applicant in life, health, and
disability insurance programs.
– Drug testing is done at this step.
38
Step 6 — final decision to hire or reject

– Best selection decisions will involve extensive
consultation among multiple parties.
– Selection decision should focus on all aspects
of the candidate’s capacity to perform the
designated job.
39
develop a quality workforce?
 Socialization
– Process of influencing the expectations,
behavior, and attitudes of a new employee in a
way considered desirable by the organization.
 Orientation
– Set of activities designed to familiarize new
employees with their jobs, coworkers, and key
aspects of the organization.
40
 Training  On-the-job training

– A set of activities – Job rotation
that provides the – Coaching
opportunity to – Mentoring
acquire and
improve job-related – Modeling
skills.  Off-the-job training
– Management
development
41
 Performance management systems ensure

that—
– Performance standards and objectives are set.
– Performance results are assessed regularly.
– Actions are taken to improve future
performance potential.
42
 Performance appraisal
– Formally assessing someone’s work
accomplishments and providing feedback.
– Purposes of performance appraisal:
• Evaluation — lets people know where they stand
relative to objectives and standards.
• Development — assists in training and continued
personal development of people.
43
maintain a quality workforce?
 Career development
– Career — a sequence of jobs that constitute what a
person does for a living.
– Career path — a sequence of jobs held over time during
a career.
– Career planning —matching career goals and individual
capabilities with opportunities for their fulfillment.
– Career plateau — a position from which someone is
unlikely to move to a higher level of responsibility.
• Progressive employers seek ways to engage plateaued
employees. Management - Chapter 12
44
 Work-life balance
– How people balance career demands with personal and
family needs.
– Progressive employers support a healthy work-life
balance.
– Contemporary work-life balance issues:
• Single parent concerns
• Dual-career couples concerns
• Family-friendliness as screening criterion used by candidates
45
 Compensation and benefits

– Base compensation
• Salary or hourly wages
– Fringe benefits
• Additional non-wage or non-salary forms of
compensation
– Flexible benefits
• Employees can select a set of benefits within a
certain dollar amount
46
 Compensation and benefits (cont.)

– Family-friendly benefits
• Help in balancing work and nonwork
responsibilities
– Employee assistance programs
• Help employees deal with troublesome personal
problems.
47
 Retention and turnover

– Replacement is the management of promotions,
transfers, terminations, layoffs, and retirements.
– Replacement decisions relate to:
• Shifting people between positions within the
organization.
• Retirement.
• Termination.
48
 Labor-management relations
– Labor unions deal with employers on the workers’
behalf.
– Labor contracts specify the rights and obligations of
employees and management regarding wages, work
hours, work rules, seniority, hiring, grievances, and
other conditions of employment
– Collective bargaining is the process of negotiating,
administering, and interpreting a labour contract.
49
Unions can create  Management can create

difficulties for unions
difficulties for
by…
management by… – Using lockouts
– Striking – Hiring strike-breakers
– Boycotting – Seeking injunctions
– Picketing Management - Chapter 12

50
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.
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.
Job Analysis
• Job Analysis-the act of examining positions

within an organization
• Job Description-narrative explaining the
scope of a position
• Job Characteristics-tasks involved in a
position
• Job Requirements-personal characteristics
necessary to fill a position
Performance Appraisal
• Process of evaluating employee

performance
– job related strengths
– development needs
– progress toward goals
– determine ways to improve performance
– Pay an promotion decisions
• More systematic is better, for the most part
Who Appraises Performance?
Supervisors
Peers Customers &

Clients
Sources of
performance
appraisals
Self Subordinates
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.
Individual Incentives
• Piece-Rate - Pay for each unit of output

• Commissions - Pay from percentage of
sales or profits
• Bonuses - Lump sum payments
• Merit Pay - Permanent increases in base pay
linked to individual’s previous performance
• Seniority - Increases over time
Team or Organizational Incentive
• Gain Sharing - teams of employees share in

gains from improvements in productivity or
cost saving measures
• Profit Sharing - A percentage of profits
earned by a department or company
• Stock Ownership
– Options
– Employee Stock Ownership Plans

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HRM Lecture

When you finish studying this chapter, you should be

• The process of planning, organizing,

 Why do people make the difference?

Human capital is essential to any

 Building high performance work environments depends on

• The quality and effectiveness of the

• Success for most organizations

 It is concerned with the optimum utilization of

• To recognize the role of HRM in

• To be ethically and socially responsible

• Service is delivered by people.

• Low quality HR leads to low quality

• HR is embedded within the work of all

 Major human resource management

• HR Planning includes all activities managers do

 The foundation of human resource planning is job

Performance tests Paper tests

Step 1—application forms

 Step 3 — employment tests

Criteria for selection devices:

Behaviorally-oriented employment tests:

 Step 4 — reference and background checks

 Step 5 — physical examinations

Step 6 — final decision to hire or reject

 Training  On-the-job training

 Performance management systems ensure

 Compensation and benefits

 Compensation and benefits (cont.)

 Retention and turnover

Unions can create  Management can create

– Striking – Hiring strike-breakers

– Boycotting – Seeking injunctions

– Picketing Management - Chapter 12

• Training: teach organizational members how to

• Job Analysis-the act of examining positions

• Process of evaluating employee

Peers Customers &

• Piece-Rate - Pay for each unit of output

• Gain Sharing - teams of employees share in

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