Human Resource Management

Human Resource Management

HRM is a management function that helps
managers to recruit select train and
develop members for an organization HRM
is concerned with the people ‘s dimension
in organizations.

These activities are made up of:

1. Recruitment & selection.
2. Training and development.
3. Performance appraisal and feedback.
4. Pay and benefits.
5. Labor relations.
Components of a HRM System

Recruitment
& Selection

Labor Training &

Relations Development

Performance
Pay &
Appraisal &
Rewards
Feedback
HRM Components
Recruitment: develop a pool of qualified
applicants.
• Selection: determine relative qualifications & potential
for a job.
Training & Development: ongoing process to
develop worker’s abilities and skills.
Performance appraisal & feedback: provides
information about how to train, motivate, and
reward workers.
• Managers can evaluate and then give feedback to
enhance worker performance.
HRM Components
◆ Pay and Benefits: high performing employees should
be rewarded with good remuneration.
• Benefits, such as health insurance, reward membership in
firm.

◆ Labor relations: managers need an effective

relationship with labor unions that represent workers.
• Unions help establish pay, and working conditions.

If management moves to a decentralized

structure, HRM should be adjusted as well.
HRM Legal Environment

 Management of HR is a complex area. There are

many federal, state and local regulations.
Equal Employment Opportunity (EEO): ensures all
citizens have equal opportunity for employment
without regard to gender, age, race, origin, religion, or
disabilities.
• Makes effective management of diversity crucial.
Equal Employment Opportunity Commission
(EEOC) enforces laws.
• Managers must take steps to ensure discrimination does
not occur.
Human Resource Planning

HR Planning includes all activities

managers do to forecast current and future
HR needs.
 Must be done prior to recruitment and selection
 Demand forecasts made by managers estimate
the number & qualifications the firm will need.
 Supply forecasts estimate the availability and
qualifications of current workers and those in the
labor market.
Recruitment & Selection

Human Resources
Job Analysis
Planning

Determine recruitment
& selection needs
HRM Planning: Outsourcing

 Outsourcing: managers can decide to contract

with outside workers rather than hiring them.
• Outsourcing is more flexible for the firm.
• Outsourcing often provides human capital at a lower cost.
 Outsource problems: managers lose control over
output.
• Outsource contractors are not committed to the firm.
Unions typically are against outsourcing that has
potential to eliminate member’s jobs.
HRM Planning: Job Analysis

 Jobanalysis determines the tasks, duties and

responsibilities of the job.
A job analysis should be done for each job in the
organization.
Job analysis can be done by:
• Observe current workers.
• Questionnaires filled out by worker and managers.
Current trends are toward flexible jobs where duties
are not easily defined in advance.
Recruitment
 External recruiting: managers look outside the
firm for people who have not worked at the firm
before.
 Managers advertise in newspapers, hold open houses,
recruit at universities, and on the Internet.
• External recruitment is difficult since many new jobs have
specific skill needs.
• A multi-prong approach to external recruiting works best.
 Internal Recruiting: positions filled within the
firm.
Internal recruiting has several benefits:
• Workers know the firm’s culture, may not have new ideas.
• Managers likely already know the candidates.
• Internal advancement can motivate employees.
Honesty in Hiring

Managers may be tempted to over-rate the

attractiveness of the job and firm.
 They feel if they are honest, person will not work
there.
 Research indicates this is a poor strategy.

Realistic Job Preview: provides an

accurate overview of the job.
 Avoidshaving to hire, train and then lose
workers.
Selection Tools

Background
Information

Interviews References

Selection

Performance tests Paper tests

Physical
Ability tests
Selection Process
After a pool of applicants are identified,
qualifications related to the job requirements are
determined:
Background Information: includes education, prior
employment, college major, etc.
Interview: almost all firms use one of two types:
• Structured interview: managers ask each person the same
job-related questions.
• Unstructured interview: held like a normal conversation.
• Usually structured interviews preferred; bias is possible.
Physical Ability Test: measure strength &
endurance.
• Good for physically demanding jobs.
Selection Process
◆ Paper & Pencil Tests: Either an ability and
personality test.
• Ability test: assess if applicant has right skills for the job.
• Personality test: seek traits relevant to job performance.
• Be sure test is a good predictor of job performance.
◆ Performance Tests: measure job performance.
• Typing speed test is one example.
• Assessment Center: candidates assessed on job-related
activities over a period of a few days.
◆ References: outside people provide candid
information about candidate.
• Can be hard to get accurate information.
Reliability & Validity
 Selection tools must be reliable and valid.
Reliability: the degree to which the tool measures the
same thing each time it is used.
• Scores should be close for the same person taking the
same test over time.
Validity: Does the test measure what it is supposed to
measure?
• Example: does a physical ability test really predict the job
performance of a firefighter?
Managers have an ethical and legal duty to develop
good selection tools.
Training & Development
Training: teach organizational members how to
perform current jobs.
• Help worker’s acquire skills to perform effectively.
Development: build worker’s skills to enable them
to take on new duties.
 Training used more often at lower levels of firm,
development is common with managers.
 A Needs Assessment should be taken first to
determine who needs which program and what
topics should be stressed.
Types of Training
Needs
Assessment

Training Development

Classroom On-the-job Classroom On-the-job

Instruction Training Instruction Training

Varied
Apprentice- Formal
work
ships Education
experiences
Types of Training

 Classroom Instruction: workers acquire

skills in classroom.
Includes use of videos, role-playing, simulations.
 On-the-Job Training: learning occurs in the
work setting as worker does the job.
• Training given by co-workers and can be done
continuously.
 Apprenticeships: worker contracts with a
master worker to learn a skill.
Types of Development

 Varied Work Experiences: Top managers must

build expertise in many areas.
• Workers identified as possible top managers given many
different tasks.
 Formal Education: tuition reimbursement is
common for managers taking classes for MBA or
similar.
• Long-distance learning can also be used to reduce travel.

Whatever training and development efforts

used, results must be transferred to the
workplace.
Performance Appraisal & Feedback
 Trait Appraisals: evaluate on traits (skills, abilities) related to the
job.
• Problem: Even though a worker has the trait, they may
not use it in the job and it is hard to give feedback.
 Behavior Appraisals: how a worker does the job.
• Focuses on what a worker does and provides good
feedback options.
 Results appraisals: what a worker accomplishes.
• Sales reps are usually evaluated on what they sell.
 Objective appraisals: based on facts (sales figures)
 Subjective appraisals: based on a manager’s perceptions of
traits, behavior, or results.
• Many rating scales used to overcome subjective
problems.
Who Appraises Performance?

Supervisors

Peers Customers &

Clients
Sources of
performance
appraisals

Self Subordinates
Who Appraises Performance?
 Self: self appraisals can supplement manager view.
 Peer appraisal: coworker provides appraisal; common in team
settings.
 360 Degree: provides appraisal from a variety of people able to
evaluate a manager:
Peers, customers, superiors, self.
• Need to be alert to bias from some evaluators.
 Effective feedback: appraisals must provide feedback:
 Formal appraisals: conducted at set times of the year

• Provides valuable, but infrequent feedback.

 Informal appraisals: manager provides frequent feedback
informally.
Effective Feedback:
1. Be specific and focus on correctable
behavior. Provide a suggested
improvement.
2. Focus on problem-solving and
improvement, not criticism.
3. Express confidence in worker’s ability to
improve.
4. Use formal and informal feedback.
5. Treat subordinates with respect and praise
achievements.
6. Set a timetable for agreed changes.
Pay and Benefits
 Pay level: how the firm’s pay incentives compare
to other firms in the industry.
• Managers can decide to offer low or high relative
wages.
Pay Structure: clusters jobs into categories based
on importance, skills, and other issues.
 Benefits:
Some are required (social security,
workers comp).
• Others (health insurance, day care, and others) are
provided at the employers option.
• Cafeteria-style plan: employee can choose the best
mix of benefits for them. Can be hard to manage.
Labor Relations

 Considersall activities managers perform to

ensure there is a good relationship with labor
unions.
There are laws regulating some areas of
employment.
• Fair Labor Standards Act (1938) prohibits child labor,
sets a minimum wage and maximum working hours.
• Equal Pay Act (1963) men and women doing equal
work will get equal pay.
• Work Place Safety (1970) OSHA mandates procedures
for safe working conditions.
Unions
Unions represent worker’s interests in
organizations.
 Managers usually have more power over an
individual worker. Workers join together in unions
to try and prevent this.
• Unions are permitted by the National Labor Relations
Act (1935) which also created the NLRB to oversee
unions.
• Not all workers want unions. Union membership costs
money in dues and a worker might not want to strike.
• Union membership is lower today than 40 years ago.
 Collective
bargaining: process unions and
management go through to negotiate work
agreements.
• Results in a contract spelling out agreed terms.
Objective Of HRM

Societal Objectives

Organizational Objectives

Functional Objectives

Personal Objectives
Image and Qualities of
HR/Personnel Manager:-

1.Fairness and firmness

2.Tactfull
3.Simpathy and
consideration
4.Knowledge of labor
5.Broad social outlook
6.Acadmic qualifications