Managing HR

1. McGraw-Hill/Irwin 7-1
Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved.

2. Learning Objectives
 L01: HRM & Competitive advantage
 L02: Recruitment - internal and external
 L03: Selection methods
 L04: Training and development
 L05: Appraisal methods
 L06: Reward systems
 L07: Unions and labor laws
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3. Strategic Human Resources Management
1. People create value
3. Talent is rare
5. A group of well-chosen, motivated people is
difficult to imitate
7. People can be organized for success
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4. The puzzle of HR
 Attracting talent
 Maintaining a well-trained, highly motivated and
loyal workforce
 Managing diversity
 Devising effective compensation systems
 Managing layoffs
 Containing health care and pension costs
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5. HR Planning Process
7-5

6. Job Analysis
 Tools for determining what is done on a given job
and what should be done on that job
b Job description describes job itself
 essential tasks, duties, and responsibilities involved in
performing job
Job specification prescribes
 skills, knowledge, abilities, and other characteristics
needed to perform job
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7. Staffing the Organization
 Recruitment
 development of a pool of applicants for jobs in an
organization
 Selection
 choosing from among qualified applicants to hire into
an organization
 Outplacement
 process of helping people who have been dismissed
from the company to regain employment elsewhere
7-7

8. Advantages & Disadvantages of
Internal Recruitment
 Knowledge of company • Limited applicant pool
and employees • Inhibits company
 Employee motivation changes – cultures,
 Outsiders may goals, etc.
demoralize employees
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9. External Recruitment
 Brings in new blood
 Can inspire motivation
 Sources
 Internet job boards, company Web sites, employee
referrals, newspaper advertisements and college
campus recruiting
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10. Selection Instruments
 Applications and resumes
 Interviews
 Reference checks
 Background checks
 Personality tests
 Drug testing
 Cognitive ability tests
 Performance tests
 Integrity tests
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11. Interviews
c Structured interviews
 Interviewer asks all applicants the same questions
and compares responses to standardized set of
answers
 Types
 Situational (hypothetical)
 Behavioral (SAR)
7 Unstructured interviews
 interviewer asks different interviewees different
questions
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12. Hiring Checks
Reference
 Contact references or former employers and
educational institutions
Background
 SSN verification, past employment/ education
verification, criminal records and credit checks
 Internet searches (e.g. Google, MySpace,
Facebook)
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13. Termination Methods
Downsizing
 laying off large numbers of managerial and other
employees
 Termination
 dismissal of employees for poor performance or
other reasons
 Employment-at-will
 legal concept that an employee may be terminated
for any reason
 Termination interview
 discussion between a manager and an employee
about the employee’s dismissal.
7-13

14. Termination Interview
Do’s Don’ts
-Give as much warning as -Leave room for confusion
possible for mass layoffs when firing
-Sit down one on one with -Allow time for debate
the individual, in a private during a termination
office session
-Complete a termination -Make personal comments
session within 15 when firing someone
minutes -Rush a fired employees
-Be sure the employee offsite unless security is
hears about his or her an issue
termination from a
manager, not a
colleague
7-14

15. Training and Development
 Training
 Teaching lower-level employees how to perform their
present jobs.
 Development
 teaching managers and professional employees broad
skills needed for their present and future jobs.
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16. Types of Training
 Orientation
 familiarizes new employees with their jobs, work units,
and organization in general
 Team training
 teaches employees skills they need to work together
and helps them interact
 Diversity training
 identifying and reducing hidden biases against people
with differences and developing skills needed to
manage a diversified workforce
 Management training
 improving managers’ people skills
7-16

17. Performance Appraisal
Assessment of employee’s job performance
Administrative
 provides managers with information to make
salary, promotion, and dismissal decisions
 helps employees understand and accept basis of
those decisions
Developmental
 identify and plan training, experience, or other
improvement that employees require
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18. Types of Performance Appraisals
 Trait appraisal
 involves judgments about employee performance traits
such as initiative, leadership and attitude
 Behavioral appraisal
 focuses on observable aspects of performance
 Results appraisal
 focuses on quantitative data such as sales volume,
units produced or profits
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19. Guidelines for Performance Appraisals
 Base performance standards on job analysis
 Communicate performance standards to
employees
 Evaluate employees on specific performance-
related behaviors rather than on a single global
or overall measure
 Document the performance appraisal process
carefully
 Use more than one rater
 Take legal considerations into account
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20. Who should do the appraisal?
 Managers and supervisors
 Peers and team members
 Subordinates
 Internal and external customers
 Self appraisals
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21. Designing Reward Systems
 Effective reward systems take into account:
 Organization
 Position
 Individual
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22. Pay Plan Factors
Internal
 organization’s compensation policy, worth of each job,
employee’s relative worth, and employer’s ability to
pay
External
 conditions of labor market, area wage rates, cost of
living, use of collective bargaining (union negotiations)
and legal requirements
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23. Employee Incentives
 Individual incentive plan
 Compares worker’s performance against objective
standard, with pay determined by employee’s
performance.
 Group incentive plan
 pay is based on group performance.
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24. Group Incentive Plans
 Gainsharing plans
 reward employees for increasing productivity or saving
money in areas under their direct control.
 Profit-sharing plans
 implemented in division or organization although some
incentives may be tailored to unit performance
 Merit pay systems
 pay raises and bonuses are based on the merit rating
received from their boss
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25. CEO Pay Controversy
 CEOs earned 500 times the average worker’s pay
 Median salary of $2.5 million for CEOs of companies
in the Standard and Poor’s stock index
 Stock options are the fastest-growing part of
executive compensation
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26. What do You think?
 Are CEOs paid too much? Why? Why not?
 Should CEOs be given stock options as part of their
compensation package? Why? Why not?
7-26

27. Employee Benefits
Benefits required by law Optional benefits
 Worker’s Compensation - Pension plans
 Social Security - Medical insurance
 Unemployment - Hospital insurance
insurance
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28. Legal Requirements of Pay Systems
 Equal Pay Act of 1963
 prohibits unequal pay for men and women who
perform equal work.
 Pregnancy Discrimination Act of 1978
 Pregnancy is a disability and qualifies a woman to
receive the same benefits that she would with any
other disability
 Employment Income Security Act of 1974
 protects private pension programs from
mismanagement.
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29. What is OSHA?
 Occupational Safety and Health Act of 1970
 Requires employers to pursue workplace safety
 Employers must maintain records of injuries and
deaths caused by workplace accidents and submit to
on-site inspection
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30. Labor Relations
 The system of relations between workers and
management
 Labor unions established to ensure that
employees are treated fairly with respect to
wages, working condition, and other issues
 National Labor Relations Act – declared labor
organizations legal, established five unfair
employer labor practices, and creating the
National Labor Relations Board (NLRB)
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31. Other Labor Relations Laws
 Labor-Management Relations Act protected
employers
 Labor-Management Reporting and Disclosure
Act established a Bill of Rights for union members,
control over dues increases, and imposed reporting
requirements for unions.
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32. Four factors play a significant role
1. Economic factors
2. Job dissatisfaction
3. Belief that the union has power to obtain desired
benefits can generate a pro-union vote
4. The image of the union
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33. Collective Bargaining Agreements
 Security clause
 Wage component
 Individual rights
 Grievance procedure
7-33

34. Review Slides
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35. Values for HR Leaders
1. Strategic
3. Ethical
5. Legal
7. Financial
7-35

36. YOU should be able to
 L01: Discuss how companies use human resources
management to gain competitive advantage
 L02: Give reasons why companies recruit both
internally and externally for new hires
 L03: Identify various methods for selecting new
employees
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37. YOU should be able to
 L04: Evaluate the importance of spending on
training and development
 L05: Explain alternatives for who appraises an
employee’s performance
 L06: Describe the fundamental aspects of a reward
system.
 L07: Summarize how unions and labor laws
influence human resources management
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38. Practice and apply your knowledge by going online at
www.mhhe.com/batemanM
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39. Test Your Knowledge
Which of these methods has been found to be
the way most job positions get filled?
A) Want ads
B) Employee referrals
C) Private employment agencies
D) Unions
E) None of the above.
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40. Test Your Knowledge
Hammond University requires all applicants to their Masters
of Business Administration Program to take the G.M.A.T.
exam. This exam measures the test taker's aptitude for
management by measuring things like verbal
comprehension, mathematical calculations, and other
necessary management skills. This type of test is
classified as a(n):
A) personality test.
B) performance test.
C) integrity test.
D) cognitive ability test.
E) none of the above.
7-40

41. Test Your Knowledge
Companies invest in training to enhance
individual performance and organizational
productivity. Which of the following is NOT a
typical training exercise?
A) Orientation training
B) Team training
C) Personality training
D) Diversity training
E) All of the above
7-41

42. Test Your Knowledge
Explain the alternatives for who should appraise an
employee’s performance.
7-42

43. Test Your Knowledge
 Describe the fundamental aspects of a reward
system
7-43

44. Test Your Knowledge
 Summarize how unions and labor laws
influence human resources management
 What are the major labor laws that influence
human resources management?
 How do unions influence human resources
management?
7-44