HRMCHAPTER 1Gaining a Competitive AdvantageDiscuss the roles and activities of a company’s human resource management functionDiscuss the implications of the economy, the makeup of the labor force, and ethics for company sustainabilityDiscuss how human resource management affects a company’s balanced scorecardDiscuss what companies should do to compete in the global marketplaceIdentify the characteristics of the workforce and how they influence human resource managementDiscuss human resource management practices that support high-performance work systemsProvide a brief description of human resource management practicesIntroductionCompetitiveness refers to a company’s ability to maintain and gain market share in its industryI t is related to company effectivenessHuman resource management refers to the policies, practices, and systems that influence employees’ behavior, attitudes, and performance M any companies refer to HRM as involving “people practices"Responsibilities of HR DepartmentsE mployment and recruitingT raining and developmentC ompensationB enefitsE mployee ServicesE mployee and community relationsP ersonnel recordsH ealth and safetyS trategic planningWhat Roles Do HR Departments Perform?How is the HRM Function Changing?T he amount of time that the HRM function devotes to administrative tasks is decreasing and its roles as a strategic business partner, change agent, and employee advocate are increasingI n shifting the focus from current operations to strategies for the future and preparing non-HR managers to develop and implement HR practices, HR managers face two important challenges:Self-service refers to giving employees online access to information about HR issuesOutsourcing refers to the practice of having another company provide servicesThe HRM ProfessionH R salaries vary depending on education and experience as well as the type of industryHR specialistsHR generalistsCollege degrees are held by the vast majority of HRM professionalsProfessional certification is less common than membership in professional associationsT he primary professional organization for HRM is the Society for Human Resource Management (SHRM)Competitive Challenges Influencing HRMT hree competitive challenges that companies now face will increase the importance of HRM practices:The Sustainability ChallengeSustainability refers to the ability of a company to survive and succeed in a dynamic competitive environmentStakeholders refers to shareholders, the community, customers, and all other parties that have an interest in seeing that the company succeedsSustainability includes the ability to:deal with economic and social changes,engage in responsible and ethical business practices,provide high quality products and services,put in place methods to determine if the company is meeting stakeholders’ needsT he changing structure of the economyImpact of September 11, 2001The competition for laborS kill demands for jobs are changingK nowledge is becoming more valuableIntellectual capital refers to the creativity, productivity, and service provided by employeesKnowledge workers are employees who contribute to the company not through manual labor butthrough a specialized body of knowledgeEmpowerment means giving employees responsibility and authority to make decisions regarding all aspects of product development or customer serviceA learning organization embraces a culture of lifelong learning, enabling all employees to continually acquire and share knowledgeT he psychological contract describes what an employee expects to contribute and what the company will provide to the employee for these contributionsA lternative work arrangements include independent contractors, on-call workers, temporary workers, and contract company workersThe Balanced ScorecardT he balanced scorecard gives managers the opportunity to look at the company from the perspective of internal and external customers, employees and shareholders.T he balanced scorecard should be used to:Link human resource management activities to the company’s business strategy.Evaluate the extent to which the human resource function is helping the company’s meet it’s strategic objectives.M easures of human resource practices primarily relate to productivity, people, and processes.Customer Service and Quality EmphasisT otal Quality Management (TQM) is a company-wide effort to continuously improve the ways, peoples, machines, and systems accomplish workC ore values of TQM include:designing methods and processes to meet the needs of internal and external customersall employees receive training in qualitypromotion of cooperation with vendors, suppliers, and customersmanagement gives feedback on progressMalcolm Baldrige National Quality Awardestablished in 1987 to promote quality awareness, to recognize quality achievements, and to publicize successful quality strategies.ISO 9000:2000quality standards adopted worldwide.Six Sigma processsystem of measuring, analyzing, improving, and controlling processes once they meetquality standards.Changing Demographics Diversity of the WorkforceI nternal labor force is the labor force of current employees.E xternal labor market includes persons actively seeking employment.T he U.S. workforce is becoming increasingly diverse.WomenMinoritiesDisabled workersImmigrantsManaging a Diverse WorkforceT o successfully manage a diverse workforce, managers must develop a new set of skills, including:Communicating effectively with employees from a wide variety of cultural backgrounds.Coaching and developing employees of different ages, educational backgrounds, ethnicity, physical ability, and race.Providing performance feedback that is based on objective outcomes.Creating a work environment that makes it comfortable for employees of all backgrounds to be creative and innovative.Legal and Ethical IssuesF ive main areas of the legal environment have influenced HRM over the past 25 yearsEqual employment opportunity legislationEmployee safety and healthEmployee pay and benefitsEmployee privacyJob securityW omen and minorities still face the “glass ceiling”H uman resource managers must satisfy three basic standards for their practices to be considered ethical:HRM practices must result in the greatest good for the largest number of peopleEmployment practices must respect basic human rights of privacy, due process, consent, and free speechManagers must treat employees equitably and fairlyThe Global ChallengeC ompanies are finding that to survive they must compete in international markets as well as fend off foreign corporations’ attempts to gain ground in the U.S.E very business must be prepared to deal with the global economy. This is made easier by technology.O ffshoring refers to the exporting of jobs from developed countries to less developed countries.M any companies are entering international markets by exporting their products overseas, building manufacturing facilities in other countries, entering into alliances with foreign companies, and engaging in e-commerceThe Technology ChallengeT echnology has reshaped the way we play, plan our lives, and where we work The overall impact of the InternetThe Internet has created a new business model – e-commerce – in which businesstransactions and relationships can be conducted electronicallyc hanged how and where we work,r esulted in high-performance models of work systems,i ncreased the use of teams to improve customer service and product quality,c hanged skill requirements,i ncreased working partnerships,l ed to changes in company structure and reporting relationships,i ncreased the availability of Human Resource Information Systems (HRIS), whichare used to acquire, store, manipulate, analyze, retrieve, and distribute HRinformation,i ncreased the availability of e-HRM, which is the processing and transmission ofdigitalized information used in HRM,i ncreased the competitiveness of high performance work systems.Meeting Competitive Challenges Through HRM Practices H RM practices that help companies deal with the three competitive challenges can be grouped into four dimensionsThe human resource environmentAcquiring and preparing human resourcesAssessment and development of human resourcesCompensating human resourcesManaging internal and external environmental factors allows employees to make the greatest possible contribution to company productivity and competitivenessCustomer needs for new products or services influence the number and type of employees businesses need to be successfulBesides interesting work, pay and benefits are the most important incentives that companies can offer employees in exchange for contributing to productivity, quality, and customer serviceHuman resource management practices of both managers and the human resource function must be aligned and contribute to the company’s strategic goalsCHAPTER 2Strategic Human Resource ManagementAfter reading this chapter, you should be able to:Describe the differences between strategy formulation and strategy implementation.List the components of the strategic management process.Discuss the role of the HR function in strategy formulation.Describe the linkages between HR and strategy formulation.Discuss the more popular typologies of generic strategies and the various HR practices associated with each.Describe the different HR issues and practices associated with various directional strategies.List the competencies the HR executive needs to become a strategic partner in the company.IntroductionT he goal of strategic management in an organization is to deploy and allocate resources in a way that gives it a competitive advantage.H uman resource managers should:have input into the strategic plan,have specific knowledge of the organization’s strategic goals,know what types of employee skills, behaviors, and attitudes are needed to support thestrategic plan,develop programs to ensure that employees have those skills, behaviors, and attitudes.What is Strategic Management?S trategic Management is a process for analyzing a company's competitive situation, developing the company's strategic goals, and devising a plan of action and allocationof resources that will help a company achieve its goals.S trategic human resource management is the pattern of planned human resource deployments and activities intended to enable an organization to achieve its goals. Components of the Strategic Management Process S trategy Formulation: Strategic planning groups decide on a strategic direction by defining the company's mission and goals, its external opportunities and threats, and its internal strengths and weaknesses.S trategy Implementation: The organization follows through on the strategy that has been chosen. This includes structuring the organization, allocating resources, ensuring that the firm has skilled employees in place, and developing reward systems that align employee behavior with the strategic goals.Model of the Strategic Management ProcessThe Role of HRM in Strategy FormulationAdministrative Linkage — Lowest level of integration; HRM function's attention is focused on day-to-day activities. No input from the HRM function to the company's strategic plan is given.One-Way Linkage — The strategic business planning function develops the plan and then informs the HRM function of the plan. HRM then helps in the implementation.Two-Way Linkage — Allows for consideration of human resource issues during the strategy formulation process. The HRM function is expected to provide input to potential strategic choices and then help implement the chosen option.Integrative Linkage — Is based on continuing, rather than sequential, interaction. The HR executive is an integral member of the strategic planning team.Strategy FormulationF ive components of the strategic management process:A mission is a statement of the organization's reasons for being.Goals are what the organization hopes to achieve in the medium-to long-term futureExternal analysis consists of examining the organization's operating environment to identify strategic opportunities and threats.Internal analysis attempts to identify the organization's strengths and weaknesses.Strategic choice is the organization's strategy, which describes the ways the organization will attempt to fulfill its mission and achieve its long term goals.Strategy ImplementationHRM PracticesJob Analysis - the process of getting detailed information about jobs.Recruitment - the process through which the organization seeks applicants.Training - a planned effort to facilitate learning of job-related knowledge, skills, and behavior.Job design - making decisions about what tasks should be grouped into a particular job.Selection - identifying the applicants with the appropriate knowledge, skills, and ability.Development - the acquisition of knowledge, skills, and behavior that improves employees' ability to meet the challenges of future jobs.Strategic TypesPorter's Generic Strategies —Michael Porter has hypothesized that competitive advantage comes from creating value by:r educing costs (overall cost leadership), orc harging a premium price for a differentiated product or service (differentiation).HRM Needs in Strategic TypesDifferent strategies require different types of employees.Role behaviors are the behaviors required of an individual in his or her role as a jobholder in a social work environment.C ost strategy firms seek efficiency and therefore carefully define the skills they needin employees and use worker participation to seek cost-saving ideas.D ifferentiation firms need creative risk takers.Directional StrategiesThe Role of HR in Providing a Competitive Advantage Emergent Strategies - Those that evolve from the grass roots of the organization.W hat actually is done versus what is planned.H R plays an important role in facilitating the communication of emergent strategiesbetween levels in the hierarchy.Enhancing Firm CompetitivenessB y developing a rich pool of talent, HR can assure the company's ability to adapt toa dynamic environment.Strategic Human Resource ExecutivesFour basic competencies:B usiness Competencies - Understanding the company's economic and financialcapabilities.P rofessional/Technical Knowledge - In HR practices such as selection techniques and compensation systems.C hange Processes or Organizational Development Techniques -The ability todiagnose the need for change and develop and implement the appropriateintervention.I ntegration Competencies - A generalist perspective with the skills of a specialist inthe above three areas.CHAPTER 3The Analysis and Design of WorkAfter reading this chapter, you should be able to:Analyze the work flow process, identifying the output, activities, and inputs in the production of a product or service.Understand the importance of job analysis in strategic and human resource management.Choose the right job analysis technique for a variety of human resource activities.Identify the tasks performed and the skills required in a given job.Understand the different approaches to job design.Comprehend the trade-offs among the various approaches to designing jobs.Work-flow AnalysisWork-flow analysis is useful because it provides a means for the managers to understand all the tasks required to produce a high-quality product as well as the skills necessary to perform those tasks.Work flow analysis includes:a nalyzing work outputsa nalyzing work processesa nalyzing work inputsDeveloping a Work-Flow AnalysisOrganizational StructureOrganization structure provides a cross-sectional overview of the static relationship between individuals and units that create the outputs.Two of the most important dimensions of structure are centralization and departmentalization.1. Centralization is the degree to which authority resides at the top of theorganizational chart.2. Departmentalization refers to the degree to which work units are groupedbased upon functional similarity or similarity of workflow.Structural ConfigurationFunctionalfunctional departmentalizationhigh level of centralizationhigh efficiencyinflexibleinsensitive to subtle differences across products, regions, and clientsDivisionalworkflow departmentalizationlow level of centralizationsemi-autonomousflexible and innovativesensitive to subtle differences across products, regions, and clientslow efficiencyThe Importance of Job Analysis to HR ManagersThe Importance of Job Analysis to Line ManagersManagers must have detailed information about all the jobs in their work group to understand the work-flow process.Managers need to understand the job requirements to make intelligent hiring decisions.Since the manager is responsible for ensuring that each individual is performing his or her job satisfactorily, the manager must clearly understand the tasks required in every job.Job Analysis InformationJob Description - a list of tasks, duties, and responsibilities (TDRs)Job Specification - a list of knowledge, skills, abilities, and other characteristics (KSAOs)Sample Job DescriptionJob Title: Maintenance MechanicGeneral Description of Job: General maintenance and repair of all equipment used in the operations of a particular district. Includes the servicing of company used vehicles, shop equipment, and machinery used on job sites.1. Essential duty (40%) Maintenance of Equipment2. Essential duty (40%) Repair of Equipment3. Essential duty (10%) Testing and Approval4. Essential duty (10%) Maintain StockNonessential functions: Other duties assignedJob Analysis MethodsPosition Analysis Questionnaire (PAQ)Task Analysis InventoryFleishman Job Analysis System (FJAS)Occupational Information Network (O*NET)Job Dimensions and Job Tasks of a UniversityProfessorJob DesignJob design is the process of defining the way work will be performed and the tasks that will be required in a given job.Job redesign refers to changing the tasks or the way work is performed in an existing job.The four approaches used in job design are:m echanistic approachm otivational approachb iological approachp erceptual-motor approachMechanistic ApproachH as its roots in classical industrial engineering.F ocuses on designing jobs around the concepts of task specialization, skill simplification, and repetition.S cientific management, one of the earliest mechanistic approaches, sought to identify the one best way to perform the job through the use of time-and-motion studies.T he scientific management approach was built upon in later years and resulted in a mechanistic approach that calls for the job to be designed very simply.N ew employees can be trained to perform the job quickly and inexpensively.Motivational ApproachThe motivational approach to job design focuses on the job characteristics that affect the psychological meaning and motivational potential of job design.A focus on increasing job complexity through job enlargement, job enrichment, and the construction of jobs around sociotechnical systems.A model of how job design affects employee reaction is the “Job Characteristics Model”.Job Characteristics ModelBiological ApproachC omes primarily from the sciences of biomechanics, or the study of body movementsI s referred to as ergonomics, or the concern with examining the interface between individuals' physiological characteristics and the physical work environment.T he goal of this approach is to minimize the physical strain on the worker by structuring the physical work environment around the way the body works.F ocuses on outcomes such as physical fatigue, aches and pains, and health complaints.Perceptual-Motor ApproachHas its roots in the human-factors literature.Focuses on human mental capabilities and limitations.The goal is to design jobs in a way that ensures that they do not exceed people's mental capabilities.Tries to improve reliability, safety, and user reactions by designing jobs in a way that reduces the information processing requirements of the job. Trade-Offs among Different Approaches to Job DesignCHAPTER 4Human Resource Planning and RecruitmentDiscuss how to align a company’s strategic direction with its human resource planning.Determine the labor demand for workers in various job categories.Discuss the advantages and disadvantages of various ways of eliminating a labor surplus and avoiding a labor shortage.Describe the various recruitment policies that organizations adopt to make job vacancies more attractive. List the various sources from which job applicants can be drawn, their relative advantages and disadvantages, and the methods for evaluating them.Explain the recruiter’s role in the recruitment process, the limits the recruiter faces, and the opportunities available.Stages in Human Resource PlanningForecastingL abor DemandL abor SupplyGoal Setting and Strategic PlanningProgram Implementation and EvaluationForecasting Stage of Human Resource Planning Determining Labor Demandd erived from product/service demandede xternal in natureDetermining Labor Supplyi nternal movements caused by transfers, promotions, turnover, retirements, etc.t ransitional matrices identify employee movements over timeu seful for AA / EEO purposesDetermining Labor Surplus or ShortageStrategies for Reducing an Expected Labor SurplusDownsizingDownsizing is the planned elimination of large numbers of personnel designed to enhance organizational competitiveness.Reasons for downsizing include:n eed to reduce labor costst echnological changes reduce need for laborm ergers and acquisitions reduce bureaucratic overheado rganizations choose to change the location of where they do businessEffects of DownsizingStudies show that firms that announce a downsizing campaign show worse, rather than better financial performance.Reasons include:T he long-term effects of an improperly managed downsizing effort can be negative.M any downsizing campaigns let go of people who turn out to be irreplaceable assets.E mployees who survive the staff purges often become narrow-minded, self-absorbed,and risk-averse.Early Retirement ProgramsT he average age of the U.S. workforce is increasing.B aby boomers are not retiring early for several reasons:improved health of older peoplea fear that Social Security will be cutmandatory retirement is outlawedM any employers try to inducevoluntary attrition among olderworkers through earlyretirement incentive programs.Employing Temporary WorkersH iring temporary workers helps eliminate a labor shortage.T emporary employment affords firms the flexibility needed to operate efficiently in the face of swings in demand.O ther advantages include:temporary workers free a firm from many administrative tasks and financial burdenstemporary workers are often times tested by a temporary agencymany temporary agencies train employees before sending them to employeesOutsourcing and OffshoringO utsourcing is an organization’s use of an outside organization for a broad set of services.O ffshoring is a special case of outsourcing where the jobs that move actually leave one country and go to another.T o help ensure the success of outsourcing:outsource only those jobs that are repetitive, predictable, and easily trained.Choose an outsourcing vendor that is large and established.Jobs that are proprietary or require tight security should not be outsourced.It is a good idea to start small and monitor constantly.Affirmative Action PlanningI t is important to plan for various subgroups within a labor force.A comparison of the proportion of workers in protected subgroups with the proportion that each subgroup represents is called a workforce utilization review.T he steps required to execute an affirmative action plan are identical to the steps in the generic planning process discussed earlier.The Human Resource Recruitment ProcessPersonnel PoliciesC haracteristics of the vacancy are more important than recruiters or recruiting sources. P ersonnel Policies vary:Internal versus External recruitingopportunity for advancementMarket leader pay strategyEmployment-at-will policies- either party can terminate the relationship at any time Due-process policy - employees can appeal a termination decisionImage advertisingRecruitment SourcesRecruitersFunctional AreaH R- versus operating area-specialistTraitsw arm and informativeRealismr ealistic job preview, honestySteps to Enhance Recruiter ImpactCHAPTER 5Selection and PlacementEstablish the basic scientific properties of personnel selection methods, including reliability, validity, and generalizability.Discuss how the particular characteristics of a job, organization, or applicant affect the utility of any test. Describe the government’s role in personnel selection decisions.List the common methods used in selecting human resources.Describe the degree to which each of the common methods used in selecting human resources meets the demands of reliability, validity, generalizability, utility, and legality.Selection Method Standards for Evaluation PurposesReliabilityReliability is the degree to which a measure of physical or cognitive abilities, or traits, is free from random error.The correlation coefficient is a measure of the degree to which two sets of numbers are related.A perfect positive relationship equals +1.0A perfect negative relationship equals - 1.0Knowing how scores on the measure at one time relate to scores on the same measure at another time refers to test-retest reliability.ValidityValidity is the extent to which performance on the measure is associated with performance on the job.Criterion-related validation is demonstrated by a correlation coefficient that indicates a significant relationship between scores on the selection measure and job performance scores. The types include:Predictive validationC oncurrent validationC ontent validationCriterion-Related ValidityContent ValidationContent validation is performed by demonstrating that the items, questions, or problems posed by the test are a representative sample of the kinds of situations or problems that occur on the job.B est for small samplesC ontent validity is achieved primarily through a process of expert judgement.GeneralizabilityGeneralizability is the degree to which the validity of a selection method established in one context extends to other contexts such as different situations, different samples of people, and different time periods.Three contexts include:d ifferent situationsd ifferent samples of peopled ifferent time periodsUtilityUtility is the degree to which the information provided by selection techniques enhances the effectiveness of selecting personnel in organizations.It is impacted by reliability, validity, and generalizability.LegalityAll selection methods must conform to existing laws and legal precedents. Three acts have formed the basis for a majority of the suits filed by job applicants:C ivil Rights Act of 1964 and 1991A ge Discrimination in Employment Act of 1967A mericans with Disabilities Act of 1991。