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Chap 2 HRM
- 1. Human Resource
Management
TENTH EDITON
© 2003 Southwestern College Publishing. All rights reserved.
PowerPoint Presentation
by Charlie Cook
Strategic Human Resource
Management
SECTION 1
Nature of
Human
Resource
Management
Chapter 2
Robert L. Mathis John H. Jackson
- 2. © 2002 Southwestern College Publishing. All rights reserved. 2â2
Learning Objectives
After you have read this chapter, you should be
able to:
â Discuss why human resources can be a core
competency for organizations.
â Define HR planning, and outline the HR planning
process.
â Specify four important HR benchmarking measures.
â Identify factors to be considered in forecasting the
supply and demand for human resources in an
organization.
- 3. © 2002 Southwestern College Publishing. All rights reserved. 2â3
Learning Objectives (contâd)
â Discuss several ways to manage a surplus of
human resources.
â Identify what a human resource information system
(HRIS) is and why it is useful when doing HR
planning.
- 4. © 2002 Southwestern College Publishing. All rights reserved. 2â4
Human Resources as a Core Competency
ï§ Strategic Human Resources Management
â Organizational use of employees to gain or keep a
competitive advantage against competitors.
ï§ Core Competency
â A unique capability in the organization that creates
high value and that differentiates the organization
from its competition.
- 6. © 2002 Southwestern College Publishing. All rights reserved. 2â6
Possible HR Areas for Core Competencies
Figure 2â1
- 7. © 2002 Southwestern College Publishing. All rights reserved. 2â7
HR-Based Core Competencies
ï§ Organizational Culture
â The shared values and beliefs of the workforce
ï§ Productivity
â A measure of the quantity and quality of work
done, considering the cost of the resources used.
â A ratio of the inputs and outputs that indicates the
value added by an organization.
ï§ Quality Products and Services
â High quality products and services are the results of
HR-enhancements to organizational performance.
- 8. © 2002 Southwestern College Publishing. All rights reserved. 2â8
Customer Service Dimensions
Figure 2â2
- 9. © 2002 Southwestern College Publishing. All rights reserved. 2â9
Factors That Determine HR Plans
Figure 2â3
- 10. © 2002 Southwestern College Publishing. All rights reserved. 2â10
Linkage of Organizational and HR Strategies
Figure 2â4
- 11. © 2002 Southwestern College Publishing. All rights reserved. 2â11
Human Resource Planning
ï§ Human Resource (HR) Planning
â The process of analyzing and identifying the need
for and availability of human resources so that the
organization can meet its objectives.
ï§ HR Planning Responsibilities
â Top HR executive and subordinates gather
information from other managers to use in the
development of HR projections for top management
to use in strategic planning and setting
organizational goals
- 12. © 2002 Southwestern College Publishing. All rights reserved. 2â12
Human Resource Planning (contâd)
ï§ Small Business and HR Planning Issues
â Attracting and retaining qualified outsiders
â Management succession between generations of
owners
â Evolution of HR activities as business grows
â Family relationships and HR policies
- 13. © 2002 Southwestern College Publishing. All rights reserved. 2â13
HR Planning Process
Figure 2â6
- 14. © 2002 Southwestern College Publishing. All rights reserved. 2â14
HR Planning Process
ï§ HR Strategies
â The means used to anticipate and manage the
supply of and demand for human resources.
âą Provide overall direction for the way in which HR
activities will be developed and managed.
Overall
Strategic Plan
Human Resources
Strategic Plan
HR Activities
- 15. © 2002 Southwestern College Publishing. All rights reserved. 2â15
Benefits of HR Planning
ï§ Better view of the HR dimensions of business
decisions
ï§ Lower HR costs through better HR management.
ï§ More timely recruitment for anticipate HR needs
ï§ More inclusion of protected groups through planned
increases in workforce diversity.
ï§ Better development of managerial talent
- 16. © 2002 Southwestern College Publishing. All rights reserved. 2â16
Scanning the External Environment
ï§ Environmental Scanning
â The process of studying the environment of the
organization to pinpoint opportunities and threats.
ï§ Environment Changes Impacting HR
â Governmental regulations
â Economic conditions
â Geographic and competitive concerns
â Workforce composition
- 17. © 2002 Southwestern College Publishing. All rights reserved. 2â17
Internal Assessment of the
Organizational Workforce
ï§ Auditing Jobs and Skills
â What jobs exist now?
â How many individuals are performing each job?
â How essential is each job?
â What jobs will be needed to implement future
organizational strategies?
â What are the characteristics of anticipated jobs?
- 18. © 2002 Southwestern College Publishing. All rights reserved. 2â18
Internal Assessment of the
Organizational Workforce
ï§ Organizational Capabilities Inventory
â HRIS databasesâsources of information about
employeesâ knowledge, skills, and abilities (KSAs)
â Components of an organizational capabilities
inventory
âą Workforce and individual demographics
âą Individual employee career progression
âą Individual job performance data
- 19. © 2002 Southwestern College Publishing. All rights reserved. 2â19
Forecasting HR Supply and Demand
ï§ Forecasting
â The use of information from the past and present
to identify expected future conditions.
ï§ Forecasting Methods
â Judgmental
âą Estimatesâasking managersâ opinions, top-down or
bottom-up
âą Rules of thumbâusing general guidelines
âą Delphi techniqueâasking a group of experts
âą Nominal groupsâreaching a group consensus in open
discussion
- 20. © 2002 Southwestern College Publishing. All rights reserved. 2â20
Forecasting HR Supply and Demand
ï§ Forecasting Methods (contâd)
â Mathematical
âą Statistical regression analysisâ
âą Simulation models
âą Productivity ratiosâunits produced per employee
âą Staffing ratiosâestimates of indirect labor needs
ï§ Forecasting Periods
â Short-termâless than one year
â Intermediateâup to five years
â Long-rangeâmore than five years
- 21. © 2002 Southwestern College Publishing. All rights reserved. 2â21
Forecasting
Methods
Figure 2â8
- 22. © 2002 Southwestern College Publishing. All rights reserved. 2â22
Estimating Internal Labor Supply for a Given Unit
Figure 2â9
- 23. © 2002 Southwestern College Publishing. All rights reserved. 2â23
Managing Human Resource
Surplus or Shortage
ï§ Workforce Realignment
â âDownsizingâ, âRightsizingâ, and âReduction in
Forceâ (RIF) all mean reducing the number of
employees in an organization.
â Causes
âą Economicâweak product demand, loss of market
share to competitors
âą Structuralâtechnological change, mergers and
acquisitions
- 24. © 2002 Southwestern College Publishing. All rights reserved. 2â24
Managing Human Resource
Surplus or Shortage
ï§ Workforce Realignment (contâd)
â Positive consequences
âą Increase competitiveness
âą Increased productivity
â Negative consequences
âą Cannibalization of HR resources
âą Loss of specialized skills and experience
âą Loss of growth and innovation skills
â Managing survivors
âą Provide explanations for actions and the future
âą Involve survivors in transition/regrouping activities
- 25. © 2002 Southwestern College Publishing. All rights reserved. 2â25
Managing Human Resource
Surplus or Shortage
ï§ Downsizing approaches
â Attrition and hiring freezes
âą Not replacing departing employees and not hiring new
employees/
â Early retirement buyouts
âą Offering incentives that encourage senior employees to
leave the organization early.
â Layoffs
âą Employees are placed on unpaid leave until called back
to work when business conditions improve.
âą Employees are selected for layoff on the basis of their
seniority or performance or a combination of both.
- 26. © 2002 Southwestern College Publishing. All rights reserved. 2â26
Managing Human Resource
Surplus or Shortage
ï§ Downsizing approaches (contâd)
â Outplacement services provided to displaced
employees to give them support and assistance:
âą Personal career counseling
âą Resume preparation and typing services
âą Interviewing workshops
âą Referral assistance
âą Severance payments
âą Continuance of medical benefits
âą Job retraining
- 27. © 2002 Southwestern College Publishing. All rights reserved. 2â27
Dealing with Downsizing
ï§ Investigate alternatives to downsizing
ï§ Involve those people necessary for success in the
planning for downsizing
ï§ Develop comprehensive communications plans
ï§ Nurture the survivors
ï§ Outplacement pays off
- 28. © 2002 Southwestern College Publishing. All rights reserved. 2â28
Overview of the
HR Evaluation
Process
Figure 2â10
- 29. © 2002 Southwestern College Publishing. All rights reserved. 2â29
Assessing HR Effectiveness
ï§ HR Audit
â A formal research effort that evaluates the current
state of HR management in an organization
â Audit areas:
âą Legal compliance (e.g., EEO, OSHA, ERISA, and FMLA)
âą Current job specifications and descriptions
âą Valid recruiting and selection process
âą Formal wage and salary system âą Benefits
âą Employee handbook
âą Absenteeism and turnover control
âą Grievance resolution process
âą Orientation program âą Training and development
âą Performance management system
- 30. © 2002 Southwestern College Publishing. All rights reserved. 2â30
Using HR Research for Assessment
ï§ HR Research
â The analysis of data from HR records to determine
the effectiveness of past and present HR practices.
ï§ Primary Research
â Research method in which data are gathered first-
hand for the specific project being conducted.
ï§ Secondary Research
â Research method using data already gathered by
others and reported in books, articles in
professional journals, or other sources.
- 31. © 2002 Southwestern College Publishing. All rights reserved. 2â31
Human Resource Information Systems
ï§ Human resource information systems (HRIS)
â An integrated system of hardware, software, and
databases designed to provide information used in
HR decision making.
â Benefits of HRIS
âą Administrative and operational efficiency in compiling
HR data
âą Availability of data for effective HR strategic planning
â Uses of HRIS
âą Automation of payroll and benefit activities
âą EEO/affirmative action tracking
- 32. © 2002 Southwestern College Publishing. All rights reserved. 2â32
Uses of an HR
Information
System (HRIS)
Figure 2â12
- 33. © 2002 Southwestern College Publishing. All rights reserved. 2â33
Designing and Implementing an HRIS
ï§ HRIS Design Issues
â What information available and what is information
needed?
â To what uses will the information be put?
â What output format compatibility with other
systems is required?
â Who will be allowed to access to the information?
â When and how often will the information be
needed?
- 34. © 2002 Southwestern College Publishing. All rights reserved. 2â34
Accessing the HRIS
ï§ Intranet
â An organizational (internal) network that operates
over the Internet.
ï§ Extranet
â An Internet-linked network that allows employees
access to information provided by external entities.
ï§ Web-based HRIS Uses
â Bulletin boards
â Data access
â Employee self-service
â Extended linkage
- 38. Hr planning in mergers and acquisitions
© 2002 Southwestern College Publishing. All rights reserved. 2â38
- 40. KET HR METRICS
© 2002 Southwestern College Publishing. All rights reserved. 2â40
- 41. Balance score card
© 2002 Southwestern College Publishing. All rights reserved. 2â41
Using the balanced scorecard requires spending considerable
time and effort to identify the appropriate HR measures in
each of the four areas and how they tie to strategic
organizational success. The balanced scorecard
should align with company goals and focus on results. To be
effective, the HR scorecard should address three elementsâ
accountability, validity, and actionable results.68 However,
regardless of the time and effort spent trying to
develop and use objective measures in the balanced
scorecard, subjectivity in what is selected and how the
measures are interpreted can still occur.