The quality of an organization is, to a large degree, dependent upon the quality of the people it hires and retains.
THE HUMAN RESOURCE MANAGEMENT PROCESS
Various studies have concluded that an organization’s human resources can be an important strategic tool and can help establish a firm’s sustainable competitive advantage.
Why Is Human Resource Management Important?
Whether or not an organization has a human resource department, every manager is involved with human resource management activities.
Studies that have explored the link between HRM policies and practices and organizational performance have found that certain HRM policies and practices have a significant impact on performance.
These high-performance work practices are human resource policies and practices that lead to both high individual and high organizational performance.
The human resource management process consists of eight activities necessary for staffing the organization and sustaining high employee performance.
External Factors that affect the HRM Process.
A number of environmental forces constrain human resource management activities.
The four factors most directly influencing the HRM process are economic conditions, employee labor unions, governmental laws and regulations, and demographic trends.
Economic conditions. Economic news, whether good or bad, has an effect on employment, attitudes toward work, careers, and retirement.
A labor union is an organization that represents workers and seeks to protect their interests through collective bargaining.
Federal laws and regulations have greatly expanded the federal government’s influence over HRM. Managers that operate in an international context must also be aware of specific laws that apply to the countries in which they do business.
Demographic trends. Aging workforce - company executives decide to redesign its factory for older workers.
IDENTIFYING AND SELECTING COMPETENT EMPLOYEES
A. Human resource planning is ensuring that the organization has the right number and kinds of capable people in the right places and at the right times.
1. Current Assessment. Managers begin HR planning by conducting a current assessment of the organization’s human resource status.
This assessment is typically accomplished through a human resource inventory.
Another part of the current assessment process is the job analysis, which is an assessment that defines jobs and the behaviors necessary to perform them.
From this information, management can draw up a job description, which is a written statement that describes a job.
In addition, management must develop a job specification, which is a statement of the minimum qualifications that a person must possess to perform a given job successfully.
2. Meeting Future Human Resource Needs. Future HR needs are determined by looking at the organization’s mission, goals, and strategies. Developing a future program requires estimates in which the organization will be understaffed or overstaffed.
B. Recruitment And Decruitment.
1. Recruitment is the process of locating, identifying, and attracting capable applicants. Job candidates can be found using a number of different sources
2. Decruitment is reducing an organization’s workforce. Decruitment options include firing, layoffs, attrition, transfers, reduced workweeks, early retirements, and job sharing.
C. Selection. Selection is screening job applicants to ensure that the most appropriate candidates are hired. Selection is an exercise in prediction. Prediction is important because any selection decision can result in four possible outcomes. The major aim of any selection activity should be to reduce the probability of making reject errors or accept errors, while increasing the probability of making correct decisions.
Validity and Reliability; Validity is the proven relationship that exists between a selection device and some relevant job criterion. Reliability is the ability of a selection device to measure the same thing consistently.
Types of Selection Devices; Managers can select employees using numerous and varied selection devices.
A realistic job preview is a preview of a job that provides both positive and negative information about the job and the company. Including an RJP can increase job
satisfaction among employees and reduce turnover.
PROVIDING EMPLOYEES WITH THE NEEDED SKILLS AND KNOWLEDGE
A. Orientation is introducing a new employee to his or her job and the organization
Work unit orientation familiarizes the employee with the goals of the work unit, clarifies how his/her job contributes to the unit’s goals, and includes an introduction to his or her coworkers.
Organization orientation informs the new employee about the organization’s objectives, history, philosophy, procedures, and rules.
Major objectives of orientation include the following:
a. To reduce initial anxiety.
b. To familiarize new employees with the job, the work unit, and the organization.
c. To facilitate the outsider-insider transition.
B. Training
Types of training include general and specific.
Traditional Training methods. On-the-job training is very common, and it may involve job rotation. Job rotation is on- the-job training that involves lateral transfers to enable employees who work on the same level of the organization to work in different jobs. On-the-job training can also involve mentoring, coaching, experiential exercises, and classroom training.
Technology-driven training methods. Today’s organizations are increasingly relying on technology-based training, including e-learning applications to communicate important information and to train employees.
RETAINING COMPETENT, HIGH-PERFORMING EMPLOYEES
A. Employee Performance Management. Managers need to know whether their employees are performing their jobs efficiently and effectively or when improvement is needed. A performance management system establishes performance standards that are used to evaluate employee performance.
Performance Appraisal Methods
A written essay appraises performance through a written description of an employee’s strengths and weaknesses, past performance, and potential.
Critical incidents are used to appraise performance by focusing on the critical job behaviors. In this technique the appraiser writes anecdotes to describe what the employee did that was especially effective or ineffective. Only specific behaviors, rather than vaguely defined personality traits, are cited.
The use of graphic rating scales is one of the oldest and most popular performance appraisal methods. This method appraises performance using a rating scale on a set of performance factors. Graphic rating scales list a set of performance factors; the evaluator goes down the list and rates the employee on each factor, using an incremental scale.
Using behaviorally anchored rating scales (BARS) is an appraisal approach that appraises performance using a rating scale on examples of actual job behavior. BARS combines major elements from the critical incident and graphic rating scale approaches. The appraiser rates an employee according to items along a scale, but the items are examples of actual behavior on the job rather than general descriptions or traits.
Multiperson comparison appraises performance by comparing it with others’ performance.
Management by objectives (MBO) is another mechanism for appraising performance. It is often used to assess the performance of managers and professional employees.
360 degree feedback appraises performance by using feedback from supervisors, employees, and coworkers.
B. Compensation and Benefits
How do organizations determine the compensation levels and benefits that employees will receive?
The purpose of having an effective reward system is to attract and retain competent and talented individuals who can help the organization achieve its mission and goals.
A compensation system can include base wages and salaries,wage and salary add-ons, incentive payments, and benefits and services.
What factors determine the compensation and benefits packages for different employees?
A number of factors influence these differences
Under a skill-based pay system, employees are compensated for the job skills they can demonstrate.Research shows that skill-based pay systems tend to be more successful in manufacturing organizations than in service organizations.
Under a variable pay system, an individual’s compensation is contingent on performance.