Introduction to Human

1 Resource Management

Copyright © 2017 Pearson Education,

1-1
Ltd.

Where Are We Now….. We begin with Chapter 1 Introduction to Human Resource

Management
The purpose of this chapter explains what Human Resource Management is and why it’s
important to all managers. We’ll see that human resource management activities such
as hiring, training, appraising, compensating, and developing employees are part of
every manager’s job. We’ll see that human resource management is also a separate
function. The main topics we’ll cover will include what human resource management is,
the trends shaping human resource management, human resource management today,
the new human resource manager, and the plan of the book.

More importantly, the human resource management concepts and techniques you’ll
learn in this book can help ensure that you get results—through people. Remember that
you can do everything else right as a manager—lay brilliant plans, draw clear
organization charts, set up world-class assembly lines, and use sophisticated accounting
controls—but still fail, by hiring the wrong people or by not motivating subordinates. On
the other hand, many managers—presidents, generals, governors, supervisors—have
been successful even with inadequate plans, organization, or controls. They were
successful because they had the knack of hiring the right people for the right jobs and
motivating, appraising, and developing them. Remember, as you read this book getting
results is the bottom line of managing, and that, as a manager, you will have to get those
results through people.

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 Learning Objectives

1-1. Explain what human resource

management is and how it relates to the
management process.
1

1-2. Briefly discuss and illustrate each of the

important trends influencing human
resource management.

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Ltd.

After studying this chapter, you will be able to:

1-1. Explain what human resource management is and how it relates to the
management process.
1-2. Briefly discuss and illustrate each of the important trends influencing human
resource management.

2
 Learning Objectives

1-3. List and briefly describe “distributed

HR” and other important aspects of
Human Management today.
1

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Ltd.

After studying this chapter, you will also be able to:

1-3. List and briefly describe “distributed HR” and other important aspects of human
management today.
1-4. List at least four important human resource manager competencies.
1-5. Outline the plan of this book.

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 I.
Explain what Human
Resource Management
is and how 1it relates to
the management process.

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Ltd.

Working for any organization means that you and those around you share common
goals, which include an interest in the growth and continuing development of the
organization. Some of those common goals include how work is accomplished within
the organization. We now begin our study of the elements of the management process
and how they relate to human resource management. Note that such individuals
generally work together to achieve the common goals of an organization.

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 What Is Human Resource
Management?
• The Management Process

o Planning
1
o Organizing
o Staffing
o Leading
o Controlling

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Ltd.

What Is Human Resource Management? – To understand what human resource

management is, it’s useful to start with what managers do. Most writers agree that
managing involves performing five basic functions: planning, organizing, staffing, leading,
and controlling. These functions in total represent the management process.

• Planning – involves establishing goals and standards; developing rules and

procedures; developing plans and forecasts.
• Organizing – involves giving each subordinate a specific task; establishing
departments; delegating authority to subordinates; establishing channels of
authority and communication; coordinating the work of subordinates.
• Staffing – involves determining what type of people should be hired; recruiting
prospective employees; selecting employees; setting performance standards;
compensating employees; evaluating performance; counseling employees; training
and developing employees.
• Leading – involves getting others to get the job done; maintaining morale, motivating
subordinates.
• Controlling – involves setting standards such as sales quotas, quality standards, or
production levels; checking to see how actual performance compares with these
standards; taking corrective action as needed.

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 The topics we’ll discuss should therefore

provide you with the concepts and

techniques every Employee

1 & Manager

needs to perform the “people” or

personnel aspects of management.

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Ltd.

These concepts and techniques include the following:

1. Conducting job analysis (determining the nature of each employee’s job).
2. Planning labor needs and recruiting job candidates.
3. Selecting job candidates.
4. Orienting and training new employees.
5. Managing wages and salaries (compensating employees).
6. Providing incentives and benefits.
7. Appraising performance.
8. Communicating (interviewing, counseling, disciplining).
9. Training employees, and developing managers.
10. Building employee relations and engagement.

In addition, what a manager should know about:

1. Equal opportunity and affirmative action.
2. Employee health and safety.
3. Handling grievances and labor relations.

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 Why Is Human Resource Management
Important to All Managers?

• To Avoid Personnel Mistakes

• To Improve Profits and Performance
• You May Spend Some
1 Time as an HR

Manager
• HR for Small Business – you may end up as
your own human resource manager

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Ltd.

Why Is HR Management Important to All Managers?

Because of the following:

1. To Avoid Personnel Mistakes – managers don’t want to make personnel mistakes,

such as not having employees doing their best, hiring the wrong person for the job,
experiencing high turnover, having to be in court due to discriminatory actions, being
cited for unsafe practices, letting a lack of training undermined department
effectiveness, or committing any unfair labor practices.

2. To Improving Profits and Performance – to help ensure that you get results—
through people.

3. You May Spend Some Time as an HR Manager – about a third of large U.S.
businesses surveyed has appointed non-HR managers to be their top human
resource executives.

4. HR for Small Business – you may well end up as your own human resource manager.
More than half of the
people working in the United States work for small firms. Small businesses as a group
also account for most

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 of the 600,000 or so new businesses created every year

Carefully studying this book will help you in these areas.

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 Line and Staff Aspects of Human
Resource Management

• Authority is the right to make decisions,

to direct the work of others, and to give
1
orders. Managers usually distinguish
between line authority and staff
authority.

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Ltd.

Line and staff managers focus their energies in different yet related and complementary
ways. Let’s talk about the two types of managers and what each does for the firm.

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 Line and Staff Managers

• Line authority
gives you the right
to issue orders
1
• Staff authority
gives you the right
to advise others in
the organization

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Ltd.

When the vice president of sales tells her sales director to “get the sales presentation
ready by Tuesday,” she is exercising her line authority. Staff authority gives a manager
the right to advise other managers or employees. It creates an advisory relationship.
When the human resource manager suggests that the plant manager use a particular
selection test, he or she is exercising staff authority.

In popular usage, people tend to associate line managers with managing departments
(like sales or production)
that are crucial for the company’s survival. Staff managers generally run departments
that are advisory or supportive, like purchasing and human resource management.

Human resource managers are usually staff managers. They assist and advise line
managers in areas like recruiting, hiring, and compensation.

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 Line Manager’s HR
Management Responsibilities

• Placing the right

person in the right
job 1
• Starting new
employees in the
organization
(orientation)

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Ltd.

Line managers do have many human resource duties.

This is because the direct handling of people has always been part of every line
manager’s duties, from president down to first-line supervisors.

Some line supervisors’ responsibilities for effective human resource management fall
under these general headings:
1. Placing the right person in the right job.
2. Starting new employees in the organization (orientation).

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 Line Manager’s HR Management
Responsibilities continued

• Training employees • Gaining creative

for jobs that are cooperation and
new to them developing smooth
1
• Improving the job working relationships
performance of • Interpreting the
each person company policies and
procedures

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Ltd.

3. Training employees for jobs that are new to them.

4. Improving the job performance of each person.
5. Gaining creative cooperation and developing smooth working relationships.
6. Interpreting the company’s policies and procedures.

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 Line Manager’s HR Management
Responsibilities continued

• Controlling labor • Creating and

cost maintaining
• Developing the 1 departmental morale
abilities of each • Protecting
person employees’ health
and physical
conditions

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Ltd.

7. Controlling labor costs.

8. Developing the abilities of each person.
9. Creating and maintaining departmental morale.
10. Protecting employees’ health and physical conditions.

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 The Human Resources Department

FIGURE 1-1 Human Resource Department Organization Chart Showing Typical

HR Job Titles
Source: “Human Resource Development Organization Chart Showing Typical HR Job Titles,” www.co.pinellas.fl.us/persnl/pdf/
orgchart.pdf. Courtesy of Pinellas County Human Resources. Reprinted with permission.
Copyright © 2017 Pearson Education,
1-13
Ltd.

In small organizations, line managers may carry out all these personnel duties
unassisted.

But as the organization grows, line managers usually need the assistance, specialized
knowledge, and advice of a separate human resource staff.
In larger firms, the human resource department provides such specialized assistance.

This FIGURE 1-1 Human Resource Department Organization Chart Showing Typical HR
Job Titles
Source: “Human Resource Development Organization Chart Showing Typical HR Job
Titles,” www.co.pinellas.fl.us/persnl/pdf/
orgchart.pdf. Courtesy of Pinellas County Human Resources. Reprinted with permission.

Examples of typical jobs include:

● Recruiters. Search for qualified job applicants.
● Equal employment opportunity (EEO) coordinators. Investigate and resolve EEO
grievances,
examine organizational practices for potential violations, and compile and submit EEO
reports.
● Job analysts. Collect and examine information about jobs to prepare job descriptions.
● Compensation managers. Develop compensation plans and handle the employee

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benefits
program.
● Training specialists. Plan, organize, and direct training activities.
● Labor relations specialists. Advise management on all aspects of union-management
relations.

At the other extreme, the human resource team for a small manufacturer may contain
just
five or six (or fewer) staff, and have an organization similar to that in Figure 1-1. There is
generally
about one human resource employee per 100 company employees.

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 New Approaches To Organizing HR

• Reorganizing the HR function of how it is

organized and delivers HR services

o Shared Services 1(Transactional ) HR

teams (Centralized)
o Corporate HR teams
o Embedded HR teams (HRBP)
o Centers of expertise
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Ltd.

Many employers are changing how they organize their human resource functions.

For example, one survey found that 44% of the large firms surveyed planned to change
how they organize and deliver HR services

• Most plan to use technology to institute more “shared services” (or “transactional”)
arrangements. These establish centralized HR units whose employees are shared by
all the companies’ departments to obtain advice on matters such as discipline
problems.

• You may also find specialized corporate HR teams within a company. These assist top
management in top-level issues such as developing the personnel aspects of the
company’s long-term strategic plan.

• Embedded HR teams is another approach that has HR generalists (also known as

“relationship managers” or “HR business partners”) assigned to functional
departments like sales and production. They provide the selection and other
assistance the departments need.

• In addition, Centers of expertise are basically specialized HR consulting firms within

the company.

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 II.
Trends Shaping Human
Resource Management
1

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Ltd.

In the continuing development of human resource management, there exist various

trends that will help shape its practice and evolution in the coming years.

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 Trends in Human Resource
Management
• Workforce Demographics and Diversity
Trends
• Trends in How People Work
• Improving Performance
1 At Work: HR as a

Profit Center
• Globalization Trends
• Economic Trends
• Technology Trends

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Ltd.

Trends are occurring in the environment of human resource management that are
changing how employers get their human resource management tasks done.

These trends include workforce trends, trends in how people work, technological trends,
and globalization and economic trends:

• Demographic and Workforce Trends. The composition of the workforce will continue
to change over the next few years; specifically, it will continue to become more
diverse with more women, minority group members, and older workers in the
workforce.

• Trends in How People Work. At the same time, work has shifted from manufacturing
jobs to service jobs in North America and Western Europe. Today over two-thirds of
the U.S. workforce is employed in producing and delivering services, not products.
Example of this is on demand workers like Uber.

• Improving Performance At Work: HR as a Profit Center Boosting Customer Service. A

bank installed special software that made it easier for its customer service
representatives to handle customers’ inquiries. However, the bank did not otherwise
change the service reps’ jobs in any way. Here, the new software system did help the
service reps handle more calls. But otherwise, this bank saw no big performance

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 gains. A second bank installed the same software. But, seeking to capitalize on how
the new software freed up customer reps’ time, this bank also had its human resource
team upgrade the customer service representatives’ jobs. This bank taught them how
to sell more of the bank’s services, gave them more authority to make decisions, and
raised their wages. Here, the new computer system dramatically improved product
sales and profitability, thanks to the newly trained and empowered customer service
reps. Value-added Human resource practices like these improve employee
performance and company profitability.
Talk About it (Discussion): Discuss
three more specific examples of
what you believe this second bank’s HR department could
have done
to improve the reps’ performance
• Globalization. Refers to companies extending their sales, ownership, and/or
manufacturing to new markets abroad. For example, Toyota builds Camrys in Kentucky,
while Apple assembles iPhones in China. Free-trade areas—agreements that reduce
tariffs and barriers among trading partners—further encourage international trade.
NAFTA (the North American Free Trade Agreement) and the EU (European Union) are
examples.

• Economic Trends. Although globalization supported a growing global economy, the

past 10 or so years were difficult economically. Look at Figure 1-2, Gross National
Product (GNP)—a measure of the United States of America’s total output—it boomed
between 2001 and 2007. During this period, home prices (see Figure 1-3) leaped as
much as 20% per year. Unemployment remained docile at about 4.7%. Then, around
2007–2008, all these measures fell off a cliff. GNP fell. Home prices dropped by 10% or
more (depending on city). Unemployment nationwide soon rose to more than 10%.

• Technology. It may be technology that most characterizes the trends shaping human
resource management today. Let’s take a look at the five main types of digital
technologies that are driving this transfer of functionality from HR professionals to
automation.

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 More on HR Technology Trends

• There are 5 main types of digital technologies driving

HR professionals to automation:
o Social Media 1

o Mobile Applications
o Gaming
o Cloud Computing
o Data Analytics (as known as Talent Analytics)

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Ltd.

• Employers increasingly use social media—tools such as Twitter, Facebook, and

LinkedIn (rather than, say, as many employment agencies) —to recruit new
employees.
• Employers use new mobile applications, for instance, to monitor employee location
and to provide digital photos at the facility clock-in location to identify workers.
• Employers use gaming, new training applications, and websites such as Knack, Gild,
and True Office enable employers to inject gaming features into training, performance
appraisal, and recruiting.
• Employers use cloud computing which enable employers to monitor and report on
things like a team’s goal attainment and to provide real-time evaluative feedback.
• Employers also use data analytics, also called talent analytics, which use statistical
techniques, algorithms, and problem-solving to identify relationships among data for
the purpose of solving particular problems (such as what the ideal candidate’s traits
are, or how can I tell in advance which of my best employees is likely to quit?)

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 III.
Today’s New Human
Resource Management
1

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Ltd.

As the challenges continue for today – so does important aspects of Human Resource
Management.

Let take a look at today’s Human Resource Management.

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 HR and Strategy

Strategic Human Resource

Management

• Strategic human resource

1
management –
means formulating and executing human
resource policies and practices that
produce the employee competencies
and behaviors that the company needs to
achieve its strategic aims.

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Ltd.

Today’s human resource managers are more involved in longer term, strategic “big
picture” issues. We’ll see in Chapter 3 (Strategy) that strategic human resource
management means formulating and executing human resource policies and practices
that produce the employee competencies and behaviors the company needs to achieve
its strategic aims. We illustrate this throughout this book with Strategic Context features
such as on the next slide.

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 HR and Adding Value

• Adding value – means helping the firm

and its employees improve in a
measurable way as a result of the human
1
resources manager’s actions.

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Ltd.

The bottom line is that today’s employers want their human resource managers to add
value by boosting profits and performance.

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 HR and Employee Engagement

• Employee engagement – refers to being

psychologically involved in, connected to,
and committed to getting
1
one’s job done.

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Ltd.

Engaged employees “experience a high level of connectivity with their work tasks,” and
therefore work hard to accomplish their task-related goals.

Employee engagement is important because it drives performance.

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