Human Resource Management

Pre Reading Comment – Chapter 8

The book does a nice job of describing all of the aspects of human resource management. As you read the chapter think about who should be doing these things ( an HR manager or a line manager). Pay particular attention to the discussion on job analysis.

Lecture Summary

• The role of HR
• Basic HR Functions:
• Job Analysis
• Recruitment and Selection
• Training
• Performance Appraisal
• Compensation

Lecture Notes

The Importance of human resource management

Organizations can not do anything without people

Expenditures on personnel – salary, benefits, training are the largest single category of expenditures in most organizations

Unlike other inputs in the production process – Human resources have to be motivated – other inputs – steel, computers, buildings just do what they do --there is no question of a building trying hard to be a productive building

Therefore, finding, motivating, and retaining employees who are highly motivated and trained to meet organizational needs is a critical factor in the success of any organization

For this reason, it is often said that all managers do human resource management

Activity 1: Think about the last jobs you have worked in. What decisions did the organization – the managers -- have to make about the people who work for them?

All of you who become managers will engage in HR activities. You will need to:

• Make decisions about who to hire to work for you

• Make decisions about the evaluation of those who work for you to make compensation decisions

• Make decisions about the kind of training to support for your employees

• Make decisions about when to terminate an employee who is not meeting organizational needs

Roles of line and Staff Managers in HR

There are usually two levels of HR actions: Human Resource Management Function (HR) versus human resource activities that are conducted by non-HR managers (hr). There is a formal HR office/function in organizations – staffed with individuals who should have expertise in HR issues. However much of the HR activities in organizations are conducted not by the folks in the HR office but by line managers

This has been an evolution over time. In years past, much more of the HR activities were conducted in the HR office and line managers had much less involvement. This change has been good for non-HR managers because it increases their influence in these critical issues. However, it also means managers need to understand more about HR.

Determining the desirable distribution of HR responsibility

Conceptual distribution of responsibilities

In determining the distribution of responsibility, we need to consider two factors: Expertise and Ownership

Expertise – whoever has unique knowledge or information relevant to a decision should be involved in the decision

Ownership – whoever’s support will be needed to implement a decision should have some involvement in the decision – Involvement often leading to support

So what does this mean

Some activities should be controlled by the HR department due to their expertise in HR issues – for example: How to interview prospective employees without violating the law or how to effectively conduct a performance appraisal, or how to design a motivational compensation system

Some activities should be controlled by individual managers due to their expertise regarding the specifics of a particular situation. For example, determining which prospective employee will fit in best with the current employees in a work group, or the feedback to give a specific employee about their performance.

In some cases the job incumbent should play a strong role due to both their expertise regarding their job and the importance of having their ownership for some decisions. For example the identification of the criteria that will be used to evaluate an individual should include some input from the individuals in the job. They know the job and are more likely to support the evaluation if they had input into the selection of the valuation criteria.

What you should expect from your HR department

The HR department of your organization should provide direction

regarding the processes to be used to manage your employees and should be a resource for you to use when you have questions or problems managing your employees.

Activity 2: Based on your work experience, what responsibilities did the HR office have? If you were a department manager, what questions might you have for a company HR office? Where would they be helpful to you?

The Basics of Human Resource Management

Job Analysis

Job Identification data (title, date who wrote), Outcomes (what is to be accomplished), employee requirements (what are the skills, education aptitudes required to do the job)

Many job descriptions still focus on tasks (the things employees can be seen doing). Increasingly, the focus is on outcomes (the things employees achieve). This is a critical distinction as an outcome approach provides greater focus on what the organization needs accomplished while giving the employee more flexibility in how to accomplish the objectives

Activity 3: Identify what you see as the tasks that I engage in as a professor. Then identify the outcomes I should be achieving. Can you do the tasks and not achieve the outcomes? Can you achieve the outcomes without the tasks? Which is more important Which approach gives the employees the most responsibility? The most discretion?

Recruitment and selection

Finding new employees is often broken into two steps – getting a good pool of candidates, and then, selecting one of them. Since you can only select from the pool you have, obviously it is important to create as large a pool as is possible.

Once you have the pool, you can select one candidate, or you can decide that none meet your needs and start the pool-creation process again. On what basis would you select a candidate? Usually on past performance, on the theory that people don’t change much – those who were good on their last job will be good on this one, and people who messed up before, will again.

Activity 4: Since prior success is so important to getting a job, how can new people get hired? What actions can college students take to indicate their abilities?

Training

Training can be thought of as investment in your human resources to assure that your people’s skills remain sharp and relevant to the organization as the organization changes. Disneyworld is an example of an organization that invests very heavily in their human resources on the philosophy that without well trained staff their customers will not have a positive experience.

Activity 5:Think about what training you received on your last job and what training you should have received. What did it cost the organization to not get this right?

Performance appraisal

One of the most important things an individual manager does with their subordinates is performance appraisal. Managers should be giving good feedback all year and use the formal appraisal process to confirm the feedback you have been providing.

While completing performance appraisal forms is critical for documenting that feedback has been provided, the most important part of the process is the discussion that the manger has with the subordinate about their performance.

Compensation

The text describes the wide range of compensation options that are available. The point to remember about all of them is the need to drive variability in (at risk) compensation. If compensation is flat – all get the same - the least productive employees feel most satisfied and the most productive employees feel most dissatisfied. If compensation is driven by performance then the opposite is true It gets down to who do you want to feel satisfied and who do you want to feel dissatisfied and therefore motivated to change?

Activity 5: Tipping in restaurants. Why do restaurants use tips as a form of compensation? As a customer what determines the size of the tip you leave? If you have worked as a food service wait person what impact, if any, did tips have on your motivation?

HR issues in the Business Plan

1. Identify by job titles the jobs you will need to fill to run your organization.
2. Write a job description for one of those jobs.
3. Identify how you will recruit individuals to staff your organization.
4. What criteria will you use to select who to hire?

Summary of Beyond the Book – expectations for the final

You should understand:

• The importance of HR for any organization
• The division of responsibility for HR activities between the HR function and line managers
• Why job descriptions increasingly take a outcomes vs. task approach to identify responsibilities
• How selection decisions are made.
• How compensation systems are conceived.