HUMAN RESOURCE MANAGEMENT  Prof. Dr. Armin Trost
Main Questions                What is Human Resource Management (HRM)?                Which Megatrends determine future ...
Innovation                                                                ?Prof. Dr. Armin Trost   Human Resource Manageme...
From manual work to knowledge work                                    0%             20%              40%   60%           ...
Demographic Changes in Germany              50%              40%                       25-34       35-49                  ...
GlobalizationGerman global TradeSource: Statistisches Bundesamt: www.destatis.deProf. Dr. Armin Trost   Human Resource Man...
Web 2.0 – User-generated Content                         Web 1.0                    Web 2.0Prof. Dr. Armin Trost   Human R...
Value ChangeProf. Dr. Armin Trost   Human Resource Management   www.armintrost.de   8
Megatrends determine future Challenges in HRM                                  Acquire the right talents       Innovation...
Human Resource Management (HRM)         All planned and controlled activities of an           organization to build and ma...
Key Terms        Human Resource Management - Innovation - Demographic        Changes - Knowledge Work - Value Change - Web...
HRM Landscape                                                               HR-                                           ...
HRM Landscape                                                               HR-                                           ...
Main Questions                How are company strategy and HR strategy                 related?                As part o...
Strategic Priorities   Innovation                      Brand            Price   Design    QualityProf. Dr. Armin Trost   H...
Company Strategy – HR Strategy        Company Strategy                            Employees      HR Strategy          Stra...
Which function is of the highest Importance?                                                         Management           ...
Key- and Bottleneck-Functions                            Low                        Talent                   Availability ...
Added Value in Key Functions and otherFunctions           Added           Value                                           ...
Age Structure Analysis                    600                    500                                     Manager          ...
Factors determining Workforce Demand                                                       Senior                         ...
Strategic Workforce Planning                                                     2013   2014   2015   2016                ...
Quantitative Workforce Planning Methods                Leading Indicators                  Determine the ratio between Pe...
Operational Workforce Planning                           Revenue              # Sales   Revenue/    # Other     Total #   ...
Workforce Planning using Task AnalysisExample Italian Restaurant                                                          ...
Key Terms        Strategic Priority - Strategy - Business-HR-Strategy Linkage        - HR Strategy - Value Chain - Key Fun...
HRM Landscape                                                               HR-                                           ...
Main Questions                What does the traditional approach in recruiting                 look like?               ...
Internal versus external Hiring                                      Internal Hiring            External Hiring           ...
Job Ads                                                     Employee Value                                               ...
Contingent Workforce                                                            Contract      Employment                  ...
Career Fairs                                                     Direct and immediate                                    ...
Executive Search                Usually executive positions will be filled through the                 (secret) help of e...
Executive Search Process                  Determine Requirements                  related to Position to be            Int...
Talent Relationship Management                               EmployeeTarget Group                                         ...
Employer Image as a competitive Advantage                        - X%                                             - X%    ...
Which Promise?Prof. Dr. Armin Trost   Human Resource Management   www.armintrost.de   37
Product Brand versus Employer Attributes                           Product                                      Employer  ...
Building an Employer Brand                                                        Target Group Definition                 ...
Potential Employee Value Propositions      Offers                 Tasks                   Company                  People ...
An historical ExampleProf. Dr. Armin Trost   Human Resource Management   www.armintrost.de   41
To the pointProf. Dr. Armin Trost   Human Resource Management   www.armintrost.de   42
Defining the Employee Value Proposition              Employer                      Target Group                Competitors...
Focus on Opportunies, Chances, Perspectives                                                                         *     ...
From EVP to specific Messages                                                                 EVP                         ...
Media Channels                                                                                                            ...
Active- passive- and non-seeking Candidates                                                     Read job ads, visit caree...
Active and passive Ways of Talent Sourcing                          High                                                  ...
Campus Recruiting             Target Universities                    Relationship Building             Marketing Activitie...
Campus Recruiting Roles                                                     Student                                       ...
Campus Recruiting Measures                High                                                              Internships   ...
Social Networks                                                     „A-Player know A-Player―                             ...
Employee Referral Programs Employees refer to  potential candidates  (friends, former  colleagues etc.)                  ...
Social Community RecruitingProf. Dr. Armin Trost   Human Resource Management   www.armintrost.de   54
Guerilla RecruitingProf. Dr. Armin Trost   Human Resource Management   www.armintrost.de   55
Candidate Segmentation                        Very                        High                                            ...
Candidate Retention Measures                                          C                              B (C)                ...
Internship Program                                                                          Employee                      ...
Candidate Retention Cycle                        Talent-Pool                        Nomination                            ...
Positive Candidate Experience                        Speed                            Transparency                Apprecia...
Key Terms        Internal versus external Hiring - Job Posting/Add - Career        Website - Contingent Workforce - Career...
HRM Landscape                                                                   HR-                                       ...
Main Questions                During a company‗s recruiting process how are                 the most suitable candidates ...
Recruiting Risks                        High                                             False                    Right   ...
Job – Position – Employee                   Position                                 Job              Employee            ...
Job Architecture            Joblevel                          Chief Marketing Officer              Executive              ...
Content and Purpose of Job Analysis            Critical                                                    Selection      ...
Critical Incident TechniqueExample: Waiter in a Restaurant                        Critical Incidents             Requireme...
Limitations of Job Analysis       Job-related aspects change        over time       Jobs need to be identified and      ...
Relevant Candidate Dimensions                                        Knowledge    Personality                           In...
... and how they might be judged                                          Education   Appearance                          ...
Candidate 1                         Engineer                         Intelligent                         Teamplayer    ...
Candidate 2                         Engineer                         Intelligent                         Teamplayer    ...
Social Judgement Biases                First Impression                    Stereotyping                  The tendency fo...
Recruiting-Funnel Application                   10:1             2:1        5:1          2:1       3:2             Hiring ...
Selection-Process                                                        Results                         Criteria definiti...
Selection Methods – Overview             Method                      Spread     Effort   Objectivity   Validity           ...
Selection Method – Overview             Method                      Spread     Effort   Objectivity   Validity   Reference...
Myers-Briggs Type Indicator (MBTI)              Favorite World                           Extraversion   Introversion      ...
D2Prof. Dr. Armin Trost   Human Resource Management   www.armintrost.de   80
Intelligence Select the option that best fits the pattern of    For each question determine the number the previous images...
Intelligence      There is scientific evidence, that people who earn      more money are often not as happy than those who...
Intellingence Score Distribution        Frequency                                                                         ...
Projective Tests         Thematic Apperception Test                 Rorschach-TestProf. Dr. Armin Trost   Human Resource M...
Online-Tests Advantages   – Global access/availability   – Low operating costs   – Opportunity for adaptive     item pres...
Advantages of Psychometric Test Methods                High objectivity due to limited impact of test operator           ...
Interview Structure     Tension                        Informal                          Talk                             ...
What both sides want to know in an Interview                        Applicant                             Employer   Why ...
Interview Questions to assess Competencies                Strategic Thinking                  How does the work you are c...
Combined Interviews                                       Interview 1   Interview 2   Interview 3     Panel-              ...
Assessment Center    Candidates                        ×         Assessors                                                ...
Assessment Center Setting                                                    Participants                                 ...
Assessment Center Exercises            Dynamic                                                                     Role pl...
Assessment Center Architecture                                                     Group               Intelligence       ...
Judgement SchemeExample Introduction  Nr.          Criteria                             Points   Commends     1         Sp...
Advantages of Assessment Centers                High objectivity, reliability and validity through                 multip...
Correlation    Correlation reflects                               r = 0,5            r=0     linear relationship         ...
Validity    Validity describes the extent to which results of     an assessment method relate to what it is     supposed ...
Reliability and Objectivity    Reliability                                               Objectivity            The exte...
Key Terms        Candidate Selection - Hiring Risk - Job versus Position -        Job Architecture - Job Family - Job Anal...
HRM Landscape                                                               HR-                                           ...
Main Questions                What is equity?                Which components make up total reward and                 b...
Equity      Reward                                                         Distributive Equity                        A  ...
Factors determining Compensation                                                    Strategic                             ...
Total Reward                                                                 Total Reward                            Total...
Development of a Base Pay System                                                       Job Analysis                       ...
Compensable Factors – Hay System                                                    Functional Expertise    8        Knowl...
Job EvaluationExample Consulting CompanyProf. Dr. Armin Trost   Human Resource Management   www.armintrost.de   108
Market Line Market Pay Average Salaries in the Market                                                              Benchm...
Base Pay Structure                        Job Grade                        Based on Job Value                Market Line  ...
Opportunities and Threats of Job Evaluation andBase Pay Structures                        Opportunities                   ...
Compensation of Business Graduatesin Germany                Entry-Level (Graduates)             Professional Experience   ...
One-Time Bonuses                A one-time bonus is a one-time payment that                 does not become part of the e...
Employee Recognition System                Every employee can acknowledge special                 performance of his/her ...
Piece-Rate System and Commission                        Piece-Rate System                             Commission  Daily Wa...
Target Bonus  Employee and supervisor                          Target Bonus                                              ...
Objective Setting Scheme                                                              Point   Achieve-   Point Value ×    ...
Does Money motivate? The Candle-Problem                        1                                     2         3          ...
Pay for Organizational Performance                Profit Sharing                        Proportions of organizational pro...
Employee Stock OptionsExample                        Stock price                        13€                        10€    ...
Types of Benefits     Security                                       Financial              – Unemployment              ...
Deferred CompensationTax-deductible Pension                                                    Cash                       ...
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A complete presentation about my lecture on modern human resource management at furtwangen university / germany. Please find the entire lecture on YouTube: http://www.youtube.com/channel/UC2KCuNpaUCfFid0UBddFk6Q

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Human Resource Management

  1. 1. HUMAN RESOURCE MANAGEMENT Prof. Dr. Armin Trost
  2. 2. Main Questions  What is Human Resource Management (HRM)?  Which Megatrends determine future challenges in HRM?  What are key fields of action in HRM?Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 2
  3. 3. Innovation ?Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 3
  4. 4. From manual work to knowledge work 0% 20% 40% 60% 80% 100% 1900 17 83 1930 30 70 1970 49 51 2000 62 38 2020 75 25 knowledge work manual work Source: Zukunftsinstitut (2008)Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 4
  5. 5. Demographic Changes in Germany 50% 40% 25-34 35-49 50-64 65+ 30% 20% 10% 0% 2010 2015 2020 2025 2030 2035 -10% -20% -30%Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 5
  6. 6. GlobalizationGerman global TradeSource: Statistisches Bundesamt: www.destatis.deProf. Dr. Armin Trost Human Resource Management www.armintrost.de 6
  7. 7. Web 2.0 – User-generated Content Web 1.0 Web 2.0Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 7
  8. 8. Value ChangeProf. Dr. Armin Trost Human Resource Management www.armintrost.de 8
  9. 9. Megatrends determine future Challenges in HRM  Acquire the right talents Innovation  Give the right rewards  Support lifelong learning Demography  Leverage employee potential  Support diversity Competitive Globalization  Build successors Advantage  Retain and share knowledge  Shape attractive working conditions Web 2.0  Manage strategic changes  Use latest technologies Value Change  Retain the best talentsProf. Dr. Armin Trost Human Resource Management www.armintrost.de 9
  10. 10. Human Resource Management (HRM) All planned and controlled activities of an organization to build and maintain the relation between employees and the organization in order to meet both business objectives and employee expectationsProf. Dr. Armin Trost Human Resource Management www.armintrost.de 10
  11. 11. Key Terms Human Resource Management - Innovation - Demographic Changes - Knowledge Work - Value Change - Web 2.0 - GlobalizationProf. Dr. Armin Trost Human Resource Management www.armintrost.de 11
  12. 12. HRM Landscape HR- Strategy & Planning Talent Development Change Management Learning Talent Acquisition Work Retention Candidate Compensation Selection & Benefits HR Social HR HR-IT Organization Media ControllingProf. Dr. Armin Trost Human Resource Management www.armintrost.de 12
  13. 13. HRM Landscape HR- Strategy & Planning Talent Development Change Management Learning Talent Acquisition Work Retention Candidate Compensation Selection & Benefits HR Social HR HR-IT Organization Media ControllingProf. Dr. Armin Trost Human Resource Management www.armintrost.de 13
  14. 14. Main Questions  How are company strategy and HR strategy related?  As part of an HR strategy which company functions should be of the highest priority?  How to plan quantitative workforce demand on both strategic and operational level?Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 14
  15. 15. Strategic Priorities Innovation Brand Price Design QualityProf. Dr. Armin Trost Human Resource Management www.armintrost.de 15
  16. 16. Company Strategy – HR Strategy Company Strategy Employees HR Strategy Strategic Challenges Competencies Key Functions Strategic Priorities Motivation Recruiting Business Objectives Commitment Development Competitive Values Communication Advantages Availabilty Layoffs Company VisionProf. Dr. Armin Trost Human Resource Management www.armintrost.de 16
  17. 17. Which function is of the highest Importance? Management Core Functions Sales/ Product Prod.- Production/ Key Service/ Mgmt R&D Design Planning Engineering Marketing Account Support Mgmt Supportive Functions Human Public Quality Controlling/ Facility/ Mgmt IT Accounting Resource Security Relations/ Purchase Logistics Mgmt Comm.Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 17
  18. 18. Key- and Bottleneck-Functions Low Talent Availability High Low Strategic High Relevance Source: Trost, A. (2012). Talent Relationship Management. Personalgewinnung in Zeiten des Fachkräftemangels. Heidelberg: Springer.Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 18
  19. 19. Added Value in Key Functions and otherFunctions Added Value Key Functions  In key functions there is an exponential relationship between performance and added value Mean  Added value in key Others functions is higher compared to other functions PerformanceProf. Dr. Armin Trost Human Resource Management www.armintrost.de 19
  20. 20. Age Structure Analysis 600 500 Manager Employees 400 Number 300 200 100 0 20 25 30 35 40 45 50 55 60 65 70 AgeProf. Dr. Armin Trost Human Resource Management www.armintrost.de 20
  21. 21. Factors determining Workforce Demand Senior Promotion Hiring out Losses From outside Retirement, Promotion Turnover Professional in Junior GrowthProf. Dr. Armin Trost Human Resource Management www.armintrost.de 21
  22. 22. Strategic Workforce Planning 2013 2014 2015 2016 Employees 120 128 132 140 Demand 18 23 28 29 Internal Availability 15 12 8 7 External Demand 3 11 20 22 RiskProf. Dr. Armin Trost Human Resource Management www.armintrost.de 22
  23. 23. Quantitative Workforce Planning Methods  Leading Indicators Determine the ratio between Performance and required numbers of employees based on programmatic assumptions (e.g. professors/students, nurses/patients).  Trend Analysis Applying statistical models that predict labour demand for the future, given objective statistics from the previous years  Task Analysis Tasks are identified and quantified in terms of appearance and workload  Conclusion by Analogy Determine workforce requirements according to those of similar organizational units or companiesProf. Dr. Armin Trost Human Resource Management www.armintrost.de 23
  24. 24. Operational Workforce Planning Revenue # Sales Revenue/ # Other Total # Year # Mgr (T€) Reps FTE* (T€) FTE of FTE 2004 6.000 30 200 9 39 6 2005 6.480 35 185 11 46 7 2006 6.998 37 189 12 49 7 2007 7.558 37 204 12 49 7 2008 8.163 36 227 13 49 7 2009 8.816 43 205 14 57 8 2010 9.521 46 207 13 59 8 2011 10.283 55 187 15 70 10 2012 11.106 58 191 17 75 11 2013 11.994 60 200 18 78 11 2014 12.954 65 20 85 12 Demand 5 2 1 Average annual Revenue Growth 8% Average Revenue/Sales Rep (T€) 200 Average Relation Other Ees/Sales Reps 0,31 Span of Control 7 * FTE: Full Time EquivalentProf. Dr. Armin Trost Human Resource Management www.armintrost.de 24
  25. 25. Workforce Planning using Task AnalysisExample Italian Restaurant Duration/ Assumptions # Tasks # Duration (h) Task (Min) Core Tasks 28 Guests/Day 200 Prepare Table 1/Table 67 2 2 Guests/Table 3 Take order 1/Table 67 3 3 Tables/Day 67 Prepare Pizza 1/Guest 200 4 13 Hours/Day 15 Billing 1/Table 67 3 3 Chat 1/Table 67 2 2 Drinks/Guest 2 Prepare Drinks 400 0,5 3 Additional Tasks 10 Breaks 5% 1 Administration 10% 3 Misc. 20% 6 Total 38 Working 8 Workforce Demand (FTE) 4,7 Hours/DayProf. Dr. Armin Trost Human Resource Management www.armintrost.de 25
  26. 26. Key Terms Strategic Priority - Strategy - Business-HR-Strategy Linkage - HR Strategy - Value Chain - Key Function - Bottleneck Function - Age Structure Analysis - Workforce Demand - Strategic Workforce Planning - Operational Workforce Planning - Planning with leading Indicators - Task AnalysisProf. Dr. Armin Trost Human Resource Management www.armintrost.de 26
  27. 27. HRM Landscape HR- Strategy & Planning Talent Development Change Management Learning Talent Acquisitio n Work Retention Candidate Compensation Selection & Benefits HR Social HR HR-IT Organization Media ControllingProf. Dr. Armin Trost Human Resource Management www.armintrost.de 27
  28. 28. Main Questions  What does the traditional approach in recruiting look like?  How is a company able to position and present itself as an attractive place to work through building an employer brand?  Which active search strategies help companies to find and approach passive candidates?  How can companies retain promising and talented candidates?Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 28
  29. 29. Internal versus external Hiring Internal Hiring External Hiring  Lower risk  New perspectives/ideas  Short Time-to-Fill  Lower training efforts  Lower costs  Competitor insights +  Internal competition  More options  Faster integration  Development opportunities  Less options  Higher costs  Higher training costs  More integration efforts −  Disappointed colleagues  Higher recruiting risks  Conflicts among managers  Higher turnoverProf. Dr. Armin Trost Human Resource Management www.armintrost.de 29
  30. 30. Job Ads  Employee Value Proposition  Job  Job-ID  Location  Social Media  Tasks and Responsibilities  Requirements, Education, Competencies  Attractive aspects  Application  Send-to-friendProf. Dr. Armin Trost Human Resource Management www.armintrost.de 30
  31. 31. Contingent Workforce Contract Employment Worker Performance Contract Salary Direction Agreement Supplier Client FeeAccording: Holtbrügge, D. (2004). Personalmanagement. Heidelberg: Springer.Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 31
  32. 32. Career Fairs  Direct and immediate contact to potential candiates  Immediate pre- selection and job offering  Direct Competition with other employers  Limited focus on specific target groups  Limited contact to passive seekers  Lower quality candidates  Additional information servicesProf. Dr. Armin Trost Human Resource Management www.armintrost.de 32
  33. 33. Executive Search  Usually executive positions will be filled through the (secret) help of executive search consultants  Leading executive search agencies are Egon Zehnder International, Heiddrick & Struggle, Russel Reynolds, Korn/Ferry, Kienbaum  The overall fee is 33% of the candidate‗s future total target annual salary which is billed independently of the success of the search (retained search)  There is a difference between active search based on research and ad-based searchProf. Dr. Armin Trost Human Resource Management www.armintrost.de 33
  34. 34. Executive Search Process Determine Requirements related to Position to be Interview Candidates filled Identify Target Check References of Companies most suitable (Consider off-limits) Candidates Negotiate job-related Candidate Search and Conditions (e.g. Salary, direct Approach Sign-on Bonus) Present profiles of three Coach new Executive possibly suitable during first 100 Days of Candidates EmploymentProf. Dr. Armin Trost Human Resource Management www.armintrost.de 34
  35. 35. Talent Relationship Management EmployeeTarget Group Active Candidate Value Definition Sourcing Retention Proposition Positive Selection & Candidate Recruiting Experience Source: Trost, A. (2012). Talent Relationship Management. Personalgewinnung in Zeiten des Fachkräftemangels. Heidelberg: Springer.Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 35
  36. 36. Employer Image as a competitive Advantage - X% - X% - X% - X% - X% Awareness Company Employer Job Application Retention Image Image Appeal Branding Personnel Marketing/ Relationship ManagementProf. Dr. Armin Trost Human Resource Management www.armintrost.de 36
  37. 37. Which Promise?Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 37
  38. 38. Product Brand versus Employer Attributes Product Employer Function Prize Company Tasks Prestige Quality Products Offers Inno- Values People Design vationAccording: Corporate Leadership Council (1999). TheEmployment Brand. Washington: The Corporate ExecutiveBoard.Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 38
  39. 39. Building an Employer Brand Target Group Definition Operation Analysis Creative Formats, Rules Employer Image, & Processes, Validation, Target Group Preferences, Campagnes Employer Stengths, Labour Competition Strategy Employee Value Proposition (EVP), Media strategy Source: Trost, A. (Hrsg.) (2009). Employer Branding. Arbeitgeber positionieren und präsentieren. Köln: Luchterhand.Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 39
  40. 40. Potential Employee Value Propositions Offers Tasks Company People Values PurposeCompensation Attractive tasks Products/ People‘s Company Environment & & projects Services Personality culture Climate Benefits International Technology Qualification Leadership Social Career work leader level of quality responsibility opportunities workforce Innovation Market leader Famous leader Health of Work-Life- Collaboration others Balance Impact Success Trust & Diversity Respect Quality of live Location Work flexibility Public reputation Security Customers Source: Trost, A. (Hrsg.) (2009). Employer Branding. Arbeitgeber positionieren und präsentieren. Köln: Luchterhand.Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 40
  41. 41. An historical ExampleProf. Dr. Armin Trost Human Resource Management www.armintrost.de 41
  42. 42. To the pointProf. Dr. Armin Trost Human Resource Management www.armintrost.de 42
  43. 43. Defining the Employee Value Proposition Employer Target Group Competitors‗ EVP Employee Value Strengths Preferences Strengths Proposition A A A B B B C C C D D E E E authentic relevant different Source: Trost, A. (Hrsg.) (2009). Employer Branding. Arbeitgeber positionieren und präsentieren. Köln: Luchterhand.Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 43
  44. 44. Focus on Opportunies, Chances, Perspectives * * Grades are not everything. Your talent also matters!Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 44
  45. 45. From EVP to specific Messages EVP Strengths Evidence & Stories Target group specific messages Source: Trost, A. (2012). Talent Relationship Management. Personalgewinnung in Zeiten des Fachkräftemangels. Heidelberg: Springer.Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 45
  46. 46. Media Channels N:N Facebook Internet-Forums, Communities Twitter Blogs YouTube Career fairs Workshop Personal Company- Career- Conversation presentation Website 1.0 Print 1:1 1:N Source: Trost, A. (2012). Talent Relationship Management. Personalgewinnung in Zeiten des Fachkräftemangels. Heidelberg: Springer.Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 46
  47. 47. Active- passive- and non-seeking Candidates  Read job ads, visit career fairs, apply actively Active Seeker  Have a job, are open for new Passive opportunities, observe the Candidates market but don‗t visit career fairs  Are not interested in a new job Non-Seeker opportunity by any means, are happy with their situation, new in their current position, close to retirement, ...Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 47
  48. 48. Active and passive Ways of Talent Sourcing High Guerilla Recruiting Competitive Poach the Intelligence Recruiter Tribal Talent Recruiting Scouting SocialCompetitiveness Community Recruiting Employee Referrals Executive Campus Search Recruiting Career Fairs Networks Job Ad Low Low Line Engagement High Source: Trost, A. (2012). Talent Relationship Management. Personalgewinnung in Zeiten des Fachkräftemangels. Heidelberg: Springer. Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 48
  49. 49. Campus Recruiting Target Universities Relationship Building Marketing Activities Criteria definition, Building social Measures to get in touch, prioritization of relationships to students, evaluate and retain universities/faculties and professors, with faculties students with high level selection and student of talent and motivation organizations Partnering between employer and target universityProf. Dr. Armin Trost Human Resource Management www.armintrost.de 49
  50. 50. Campus Recruiting Roles Student Ambassador Top-Manager HR Students Manager/ Employees Professors Career CenterProf. Dr. Armin Trost Human Resource Management www.armintrost.de 50
  51. 51. Campus Recruiting Measures High Internships Theses Presentations/ Scholar- lectures ships Benefit* Case-Study- Workshops Company Inhouse Sponsorship Days University Days Theses Award Posters Low Low Effort High * Based on numbers of applicationsProf. Dr. Armin Trost Human Resource Management www.armintrost.de 51
  52. 52. Social Networks  „A-Player know A-Player―  „The Strength of weak ties―  Growing usage of employee referral programs  Referrals are seen as highly credible  Growing social media usageProf. Dr. Armin Trost Human Resource Management www.armintrost.de 52
  53. 53. Employee Referral Programs Employees refer to potential candidates (friends, former colleagues etc.) Recommended Company gets in Person touch with recommended person Hiring Referral Once the recommended person gets hired the Company Employee employee who referred to him/her gains a bonus BonusProf. Dr. Armin Trost Human Resource Management www.armintrost.de 53
  54. 54. Social Community RecruitingProf. Dr. Armin Trost Human Resource Management www.armintrost.de 54
  55. 55. Guerilla RecruitingProf. Dr. Armin Trost Human Resource Management www.armintrost.de 55
  56. 56. Candidate Segmentation Very High A Candidate B Potential C Medium/ High Low Relevance to High Key-/Bottleneck Function Source: Trost, A. (2012). Talent Relationship Management. Personalgewinnung in Zeiten des Fachkräftemangels. Heidelberg: Springer.Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 56
  57. 57. Candidate Retention Measures C B (C) A (B, C) 1:1 Regular Conversation with line representatives Invitation to Breakfast company events with the CEO Intensity Greeting Weekend- Job-Offers cards workshops Social Holiday Theses Media Jobs Access to Company Personal Intranet magazine gifts Information about vacant positions 1:N Newsletter Priority Source: Trost, A. (2012). Talent Relationship Management. Personalgewinnung in Zeiten des Fachkräftemangels. Heidelberg: Springer.Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 57
  58. 58. Internship Program Employee Company keeps Talent relationship to former Formal Assessment Pool intern Responsibility for a small project of relevance for Project Work the company/business function Transactional work on a daily basis in one or more Regular Internship business functionsProf. Dr. Armin Trost Human Resource Management www.armintrost.de 58
  59. 59. Candidate Retention Cycle Talent-Pool Nomination Operation Planning Documentation Job-Offer Recruiting Source: Trost, A. (2012). Talent Relationship Management. Personalgewinnung in Zeiten des Fachkräftemangels. Heidelberg: Springer.Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 59
  60. 60. Positive Candidate Experience Speed Transparency Appreciation The company‘s reaction The candidate is always The candidate is treated on incoming applications clear about current with full respect. The and throughout the entire status. He/she company consequently recruiting process is understands why certain demonstrates its interest faster than thoses of the selection instruments are in those candidates it competitors used and gets wants to hire. appropriate feedbackProf. Dr. Armin Trost Human Resource Management www.armintrost.de 60
  61. 61. Key Terms Internal versus external Hiring - Job Posting/Add - Career Website - Contingent Workforce - Career Fair - Public Jobboard - Executive Search - Off-Limit - Talent Shortage - Talent Relationship Management (TRM) - Employer Image - Brand - Product versus Employer Brand - Employee Value Proposition - Employer Positioning - Employers Strengths - Labor Competition - Target Group Preferences - Active Seeker - Passive Seeker - Active Sourcing - Social Community Recruiting - Referral Program - Guerilla Recruiting - Campus Recruiting - Internship Program - Talent Pool - Candidate Retention - Candidate ExperienceProf. Dr. Armin Trost Human Resource Management www.armintrost.de 61
  62. 62. HRM Landscape HR- Strategy & Planning Talent Development Change Management Learning Talent Acquisition Work Retention Candidat e Compensation Selection & Benefits HR Social HR HR-IT Organization Media ControllingProf. Dr. Armin Trost Human Resource Management www.armintrost.de 62
  63. 63. Main Questions  During a company‗s recruiting process how are the most suitable candidates selected and which risks need to be controlled?  How can a company determine a candidate‗s future performance? Which selection criteria are typically used?  What are the most commonly used selection methods?  How can you determine the quality of a selection method in terms of objectivity, reliability and validity?Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 63
  64. 64. Recruiting Risks High False Right Negative Positive Actual Performance Right False Negative Positive Low Low Predicted High PerformanceProf. Dr. Armin Trost Human Resource Management www.armintrost.de 64
  65. 65. Job – Position – Employee Position Job Employee Responsibilities e.g. teacher, butcher, manager, sales representative Job FamilyProf. Dr. Armin Trost Human Resource Management www.armintrost.de 65
  66. 66. Job Architecture Joblevel Chief Marketing Officer Executive Head of Accounting Upper Management Research Manager Department Head Team Lead Sales Representative Senior Research Assistant Junior Marketing R&D Production Sales Admin HR Job FamilyProf. Dr. Armin Trost Human Resource Management www.armintrost.de 66
  67. 67. Content and Purpose of Job Analysis Critical Selection Requirements Incidents Criteria Job Description Employee Magic Attractive Value Moments Aspects Proposition Job AnalysisProf. Dr. Armin Trost Human Resource Management www.armintrost.de 67
  68. 68. Critical Incident TechniqueExample: Waiter in a Restaurant Critical Incidents Requirements  Restaurant is crowded and  Friendliness guests become impatient  Speed  Guests complain about inedible dishes  Resilience  A drunken group of guests with  Knowledge no money in their pockets  Direction  A guest wants to learn more  Coolness about minor details of a specific wine  Diplomacy  The cook is sick and his deputy  Empathy is out of his depthProf. Dr. Armin Trost Human Resource Management www.armintrost.de 68
  69. 69. Limitations of Job Analysis  Job-related aspects change over time  Jobs need to be identified and classified (job architecture)  It might be the employee who defines his/her job (dejobbing)  Job descriptions may increase bureaucracy  Job descriptions support the „this-is-not-my-job― mindsetProf. Dr. Armin Trost Human Resource Management www.armintrost.de 69
  70. 70. Relevant Candidate Dimensions Knowledge Personality Interests Motivation Expectations Competence Attitudes Talents Contacts Age, Gender, Look?Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 70
  71. 71. ... and how they might be judged Education Appearance Interview Motivation Letter Reason to CV Apply Private Former Engagement Development References Photo, AppearanceProf. Dr. Armin Trost Human Resource Management www.armintrost.de 71
  72. 72. Candidate 1  Engineer  Intelligent  Teamplayer  Confident  Result-oriented  Ambitious  CreativeProf. Dr. Armin Trost Human Resource Management www.armintrost.de 72
  73. 73. Candidate 2  Engineer  Intelligent  Teamplayer  Confident  Result-oriented  Ambitious  CreativeProf. Dr. Armin Trost Human Resource Management www.armintrost.de 73
  74. 74. Social Judgement Biases  First Impression  Stereotyping The tendency for a The tendency to perceiver to rely on early generalize about people cues or first impressions. in a social category  Recency Effect  Contrast-Effect The tendency for a The tendency to judge perceiver to rely on upward or downward recent cues or last because of a comparison impressions. with another candidate who was recently judged  Projection The tendency for  Halo-Effect perceivers to attribute The tendency to provide their own thoughts, similar ratings across priorities and feelings to different dimensions others based on an overall judgementProf. Dr. Armin Trost Human Resource Management www.armintrost.de 74
  75. 75. Recruiting-Funnel Application 10:1 2:1 5:1 2:1 3:2 Hiring Pre-Selection Personal Accepted Interview Job-offer Telephone- Assessment Interview/ Center TestProf. Dr. Armin Trost Human Resource Management www.armintrost.de 75
  76. 76. Selection-Process Results Criteria definition consolidation Appropriate tools Decision and methods Communicating the Usage decisionProf. Dr. Armin Trost Human Resource Management www.armintrost.de 76
  77. 77. Selection Methods – Overview Method Spread Effort Objectivity Validity Resume Cognitive Ability Test Physical Ability Test Personality Test Biographical Questionnaire Personal Interview Assessment CenterProf. Dr. Armin Trost Human Resource Management www.armintrost.de 77
  78. 78. Selection Method – Overview Method Spread Effort Objectivity Validity Reference Check Background Investigation „Google― Heuristics Physiological Tests Graphology Games/Simulation sProf. Dr. Armin Trost Human Resource Management www.armintrost.de 78
  79. 79. Myers-Briggs Type Indicator (MBTI) Favorite World Extraversion Introversion Information Sensing INtuition Decision Thinking Feeling Structure Judging PerceivingProf. Dr. Armin Trost Human Resource Management www.armintrost.de 79
  80. 80. D2Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 80
  81. 81. Intelligence Select the option that best fits the pattern of For each question determine the number the previous images that best fits the pattern of the previous numbers 1. 1, 3, 6, ? 2. 3, 5, 8, 13, 21, ? 3. 3, 6, 18, 108, ? 4. 4, 1, -3, -4, ? 5. 95, 36, 15, ? 6. 6, 13, 29, 63, ? 7. 1, 1, 2, 6, ? 8. 12, 33, 55, ? 9. 99, 86, 73, ? 10. 2, 5, 8, 35, ? 11. 4, 16, 49, ? 12. 73, 61, 56, 62, ? 13. 1588, 1820, 2148, 2204, 2284, ? 14. 923, 937, 963, ?Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 81
  82. 82. Intelligence There is scientific evidence, that people who earn more money are often not as happy than those who earn less money. Please create as much theses supporting this finding as possible.Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 82
  83. 83. Intellingence Score Distribution Frequency Mean: 100 Standard-Deviation: 15 ⅔ 85 100 115 Test-Score (IQ)Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 83
  84. 84. Projective Tests Thematic Apperception Test Rorschach-TestProf. Dr. Armin Trost Human Resource Management www.armintrost.de 84
  85. 85. Online-Tests Advantages – Global access/availability – Low operating costs – Opportunity for adaptive item presentation – Automatic/immediate analysis and reporting – Opportunity to track response time Disadvantages – Limited control over test situation and subject behaviour – Limited opportunities to professionally support interpretation of resultsProf. Dr. Armin Trost Human Resource Management www.armintrost.de 85
  86. 86. Advantages of Psychometric Test Methods  High objectivity due to limited impact of test operator  High comparability across candidates due to standardized test conditions  Limited costs per test usage  Test can be used as modules complementing other selection measures  Tests require minimal infrastructures and can be used in almost every situation  Tests can be exposed even online at any time and at many locations  Analysis is very simple (e.g. score is equal to the amount of correctly-answered items)Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 86
  87. 87. Interview Structure Tension Informal Talk Questions about the applicant Open Questions Next Steps Company/Jo b Presentation TimeProf. Dr. Armin Trost Human Resource Management www.armintrost.de 87
  88. 88. What both sides want to know in an Interview Applicant Employer  Why am I invited?  Why are you here?  What can your company  What can you do for us? offer me?  What kind of person are  What kind of employer are you? you?  What distinguishes you from  What distinguishes your others who have the same company from others? skills?  Can I afford to work at your  Can we afford you? company?Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 88
  89. 89. Interview Questions to assess Competencies  Strategic Thinking How does the work you are currently doing affect your organization‘s ability to meet its mission and goals? Do you think your work is important? If yes, why? If no, why not?  Planning Describe a time when things didn’t turn out as you had planned. What did you do to analyze the situation and how did you address the issue?  Interpersonal Relations Give an example of a situation where the group of people you worked with on a regular basis had a serious conflict. What was the conflict about? How were you involved in the conflict? What was the outcome?  Communication Tell me about a time when you really had to pay attention to what someone else was saying, actively seeking to understand their message? How did this challenge affect the manner in which you portray important messages to others? Source: Corporate Leadership Council (2004): Interview Questions to Assess CompetenciesProf. Dr. Armin Trost Human Resource Management www.armintrost.de 89
  90. 90. Combined Interviews Interview 1 Interview 2 Interview 3 Panel- Criteria HR Manager Techn. Exp. interview Teamability Technical Skills Motivation Leadership MobilityProf. Dr. Armin Trost Human Resource Management www.armintrost.de 90
  91. 91. Assessment Center Candidates × Assessors × Criteria × Methods × Situations 6-15 Well-trained Intelligence, Tests, In-tray, candidates psychologists social group- presentation, and competence, exercises, Role play, managers mobility Interviews, ... ... ...Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 91
  92. 92. Assessment Center Setting Participants Assessor FacilitatorProf. Dr. Armin Trost Human Resource Management www.armintrost.de 92
  93. 93. Assessment Center Exercises Dynamic Role play Meet Introduction (role not Employees defined) Role play In-Tray Case Studies (role defined) Group Psychometric Business problem Tests Simulation solving Standard Individual GroupProf. Dr. Armin Trost Human Resource Management www.armintrost.de 93
  94. 94. Assessment Center Architecture Group Intelligence Criteria Introduction Exercise In-Tray test Interview Leadership Communication Intelligence Mobility Intercultural Sensitivity OrganizationProf. Dr. Armin Trost Human Resource Management www.armintrost.de 94
  95. 95. Judgement SchemeExample Introduction Nr. Criteria Points Commends 1 Speaks loud and clear 3 mumbles 2 Keeps eye contact 6 sometimes 3 To the point 1 4 Body expression 3 overdone 5 Structure 7 Uses flipchart 6 Stays in time 5 3 Minuts 7 Uses Time 2 Speeds up Total 27Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 95
  96. 96. Advantages of Assessment Centers  High objectivity, reliability and validity through multiple methods, exercises, criteria, assessors  Comparability of candidates within and across assessment Centre cycles  Reflection of future duties and responsibilities  Limited risk of social desirable behaviour  High transparency of requirements in the eyes of the participantsProf. Dr. Armin Trost Human Resource Management www.armintrost.de 96
  97. 97. Correlation  Correlation reflects r = 0,5 r=0 linear relationship Y Y between two variables (X and Y)  It can vary between -1 and +1 X X  Is used to determine r = 0,9 r = -0,5 validity, reliability Y Y and objectivity X XProf. Dr. Armin Trost Human Resource Management www.armintrost.de 97
  98. 98. Validity  Validity describes the extent to which results of an assessment method relate to what it is supposed to measure Person Test Criterion 1 78 72 (e.E. Performance) 2 67 68 Criterion 3 44 51 … n 89 83 r Prediction (e.E. Test-Score) Criterion-ValidtyProf. Dr. Armin Trost Human Resource Management www.armintrost.de 98
  99. 99. Reliability and Objectivity  Reliability  Objectivity The extent to which a predictor Multiple rater independently repeatedly produces the same produce the same results in results over time terms of execution, analysis and interpretation Person 1. Test 2. Test Person Assessor 1 Assessor 2 1 78 72 1 78 72 2 67 68 2 67 68 3 44 51 3 44 51 … … n 89 83 n 89 83 r r Test Retest Reliability Interrater-ReliabilityProf. Dr. Armin Trost Human Resource Management www.armintrost.de 99
  100. 100. Key Terms Candidate Selection - Hiring Risk - Job versus Position - Job Architecture - Job Family - Job Analysis - Critical Incident Technique - Job Description - Dejobbing - This-is- not-my-Job-Mindest - Applicant - Stereotyping - Primacy Effect - Halo-Effect - Recruiting Funnel - Pre-Selection - Biografic Questionnaire - Reference Check - Background Investigation - Graphology - Heuristics - Resumé - Personality - Personality Test - Social Desirability - Myers- Briggs Type Indicator - Ability Test - Intelligence Test - Standard Deviation - Projective Tests - Online Testing - Adaptive Item Presentation - Job Interview - Assessment Center - In-Tray Test - Role Play - Correlation - Validity - Reliability - ObjectivityProf. Dr. Armin Trost Human Resource Management www.armintrost.de 100
  101. 101. HRM Landscape HR- Strategy & Planning Talent Development Change Management Learning Talent Acquisition Work Retention Candidate Compensatio Selection n & Benefits HR Social HR HR-IT Organization Media ControllingProf. Dr. Armin Trost Human Resource Management www.armintrost.de 101
  102. 102. Main Questions  What is equity?  Which components make up total reward and based on which factors are these components determined?  Under which conditions does money impact motivation for performance?Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 102
  103. 103. Equity Reward  Distributive Equity A One‘s performance reward relation compared to others Equity  Procedural Equity Do procedures to determine compensation B lead to fair results? Performance/ Contribution to company successProf. Dr. Armin Trost Human Resource Management www.armintrost.de 103
  104. 104. Factors determining Compensation Strategic Responsibility Performance Relevance Company Qualification Market Success Civil Cost of Living Tenure StatusProf. Dr. Armin Trost Human Resource Management www.armintrost.de 104
  105. 105. Total Reward Total Reward Total Compensation Non-financial Reward Base Pay Variable Pay Benefits Individual/ Organisation Group Salary Piece Rate Profit Insurances Appreciation Sharing One-time Contacts Wages Bonus Stock Ownership Pension Target Bonus Privileges Stock Commission Options Services TitleAccording: Holtbrügge, D. (2004). Personalmanagement. Heidelberg: Springer.Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 105
  106. 106. Development of a Base Pay System Job Analysis Job Evaluation Pay Survey Pay Policies Pay Structures Job Individual Pay Appointment Implementation, Communication, MonitoringAccording: Mathis & Jackson: Human Resource Management. South-Western.Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 106
  107. 107. Compensable Factors – Hay System Functional Expertise 8 Knowledge Managerial Skills 7 Human Relation 3 Environment 8 Problem Solving Challenge 5 Freedom to act 8 Accountability Impact on end results 4 Magnitude Dyn. ΣProf. Dr. Armin Trost Human Resource Management www.armintrost.de 107
  108. 108. Job EvaluationExample Consulting CompanyProf. Dr. Armin Trost Human Resource Management www.armintrost.de 108
  109. 109. Market Line Market Pay Average Salaries in the Market  Benchmark jobs are Jobs at other companies with Benchmark-Jobs Market similar duties, Line requirements etc.  Market line represents relationship between job value and market pay  Computing market line by using statistical regression analysis Job ValueProf. Dr. Armin Trost Human Resource Management www.armintrost.de 109
  110. 110. Base Pay Structure Job Grade Based on Job Value Market Line 8 7 6 5 A 4 B 3 2 1 Pay Rate (€)Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 110
  111. 111. Opportunities and Threats of Job Evaluation andBase Pay Structures Opportunities Threats  Common foundation for  Significant bureaucracy compensation-related during implementation decisions  Acceptance of all  Job-related distributive and stakeholders involved procedural equity  Requires clear job definitions  Transparency of compensation-related  Reduces flexibility of decisions compensation-related decisions  Active elaboration of job values and contribution to  May reduce innovation and company‗s success employee engagementProf. Dr. Armin Trost Human Resource Management www.armintrost.de 111
  112. 112. Compensation of Business Graduatesin Germany Entry-Level (Graduates) Professional Experience Median 50% Source: Personalmarkt, 2006Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 112
  113. 113. One-Time Bonuses  A one-time bonus is a one-time payment that does not become part of the employee‗s base pay  Can be used to reward employees for contributing new ideas, coping with critical challenges, acquiring new skills  Bonuses usually recognize performance of both the employer and the company  Bonuses provide great flexibility in rewarding valued behaviours at particular situationsProf. Dr. Armin Trost Human Resource Management www.armintrost.de 113
  114. 114. Employee Recognition System  Every employee can acknowledge special performance of his/her colleagues with a gift  Based on his/her own budget (% of base pay)  To operate the system there is an internal kind of gift-plattform in the intranet  The value of gifts totally received by an employee can serve as a basis for performance appraisal  It‗s a rarely used approach but its popularity increasesProf. Dr. Armin Trost Human Resource Management www.armintrost.de 114
  115. 115. Piece-Rate System and Commission Piece-Rate System Commission Daily Wage Salary variable variable fix fix Daily Performance RevenueProf. Dr. Armin Trost Human Resource Management www.armintrost.de 115
  116. 116. Target Bonus  Employee and supervisor Target Bonus (%) agree on both individual targets and relation between target achievement and target 140 B bonus 120  Employees can choose from A different options reflecting 100 different risk preferences  Primarily used for managers 80 and senior employees 60 60 80 100 120 140 Target Achievement (%)Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 116
  117. 117. Objective Setting Scheme Point Achieve- Point Value × Objective Value ment Achievement Organize CEBIT Fair attendance. Generate 100 leads + follow-up 10 130% 13 Successfully integrate 3 new hired colleagues by end of the year 10 90% 9 New corporate website relaunch. 400 clicks per day by end of the year 25 105% 26 Σ 45 48 Σ 100% 107.2% Target Bonus in € 5.000 5.361Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 117
  118. 118. Does Money motivate? The Candle-Problem 1 2 3 Dan Pink: The puzzle of motivation http://www.ted.com/talks/dan_pink_on_motivation.htmlProf. Dr. Armin Trost Human Resource Management www.armintrost.de 118
  119. 119. Pay for Organizational Performance  Profit Sharing Proportions of organizational profits are distributed among employees according to their base pay  Employee Stock Ownership Giving employees stock ownership of the organization or the right to acquire stocks at a price below market. Employees must keep stocks for a specific period of time  Employee Stock Options The right to buy (exercise) a certain number of stocks at a specific priceProf. Dr. Armin Trost Human Resource Management www.armintrost.de 119
  120. 120. Employee Stock OptionsExample Stock price 13€ 10€ Option 6€ 4€ 0 Time tProf. Dr. Armin Trost Human Resource Management www.armintrost.de 120
  121. 121. Types of Benefits  Security  Financial – Unemployment – Interest-free building loan compensation – Company credits – Life insurance – Financial counselling – Disability insurance – Early retirement options  Offerings – Disability retirement benefits – Company car – Pension Plans – Private cell phone, laptop usage  Health – Free lunch – Health Care Insurance – Cafeteria and food services – Sabbatical – Child Care; Company – Free tennis courts, fitness Kindergarten centre usage – Cost advantages for – Medical care company products – Psychiatric counselling – Company accommodationProf. Dr. Armin Trost Human Resource Management www.armintrost.de 121
  122. 122. Deferred CompensationTax-deductible Pension Cash Pension Employer Employee Employer EmployeeCompensation 1.000.000 € 1.000.000 € 1.000.000 € 1.000.000 €Social Security + 200.000 € - 210.000 €Pay Tax - 290.000 €Result 1.200.000 € 500.000 € 1.000.000 € 1.000.000 €Benefit 200.000 € 500.000 €Prof. Dr. Armin Trost Human Resource Management www.armintrost.de 122
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