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1/4/2010 GROUP 5 Members: Ashley Joseph Anthony Peters Japheth Valenzuela Totaram Singh
This presentation is basically trying to find out Human Resource Management, the types and the steps in Attracting Human Resource. It also explains the different aspects that is concerned with Human Resource, which includes Maintaining Human Resource, Managing Workforce Diversity, Managing Labour relations along with its sub topics.
The researchers would first like to Thank the Almighty GOD for helping Us, the group members, to get through this presentation and for Good Health and providing supplies; the researchers would like to thank the personnel of GTI’s library that helped us in our data collection. The researchers would also like to Thank Miss Crawford, the Management Teacher, for assistance. And Finally Gratitude is extended to all the researchers’ families for their patience and assistance in the compilation of this Evaluation.
HUMAN RESOURCE MANAGEMENT
Group members: Ashley Joseph Anthony Peters Japeth velenzula Totaram singh
The Environmental Context of Human Resource Management
What is Human Resource Management? Human Resource Management (HRM) is the set of Organizational activities directed at attracting, developing and maintaining an effective workforce.
The Strategic Importance of HRM
Human resources are critical for effective organizational functioning. Managers are now beginning to realize the effectiveness of their HR function and how it has a substantial impact on the bottom- line performance of the firm. Inadequate Human Resource planning can result in spurts of hiring following by layoffs –- costly in terms of employment compensation payments, training expenses, and morale. Chaotic compensation systems do not attract, keep, and motivate good employees, and outmoded recruitment practices that can expose the organization to expensive and embossing discrimination lawsuits. Most organizations with a few hundred employees usually have a Human Resource Manager and a Human Resource Department that is charged with overseeing the said above activities. Responsibility designed for HR activities is shared between the HR department and line managers, the HR department recruits and sort through candidates but the managers are the ones who make the final decision as to who leaves or stays.
The Legal Environment of HRM
A number of laws were reinforced to regulate various aspects of employee – employer relations, especially in the areas of equal employment opportunity, compensation and benefits, labour relations, and occupational safety and health. Some of the major laws are summarized below: Equal Employment Opportunity
Title VII of the Civil Rights Act of 1944-forbids discrimination in all areas of the employment relationship. Age discrimination in Employment Act- outlaws discrimination of people older than forty years.
Compensation and Benefits
Fair Labour Standards Act-establishes minimum wage and mandated overtime pay for work in excess of forty hours per week.
National Labour Relations Act-spells out procedures by which employees can establish labour unions and requires organizations to bargain collectively with legally formed union; also known as the WAGNER ACT
Health and Safety
Occupational safety and health act of 1970: mandates the provision of safe working conditions.
There are three major with subtopics between them, starting off with Attracting Human Resource to Developing Human Resource and Managing Human Resource
After studying the environmental context of Human Resource Management as a base, it should be easy to understand and address the real concern which is attract qualified people who are ready to work in the organization. This diagram bellow illustrates the different steps in gaining effective and good quality Human Resource for any organization.
Human Resource Planning
Training and development
Induction and orientation.
Figure 1: Generally summarizes the steps most often follow by Managers when attracting Human Resource Planning
Attracting Human Resource
• Human Resource Planning (HR Planning)
Human Resource Planning involves accessing trends, forecasting supply and demand of labour, and developing appropriate strategies for addressing any differences. The first issue that needs to be addressed is planning a way of attracting the persons necessary for the job. HR Planning, therefore, involves job analysis and forecasting the demand and supply of labour. Attracting Human Resource cannot be left to chance if an organization expects to function at peak efficiency.
Job analysis is the systematic analysis of jobs with an organization. This, however, divides into two individual results. 1. Job description—is duties of a job, the job’s working conditions and any sort of equipment and materials used to achieve it. 2. Job specification – is the skills, abilities and other qualifications needed to do the job.
Forecasting Human Resource Demand and Supply
When managers fully understand the jobs to be performed within the organization, they will need to start to plan for the organization’s future human resources needs. The Manager starts by accessing trends in past human resources usage, future organizational plans, general plans, and general economic trends. Large organizations use more complicated models to predict future human resource needs. Forecasting the supply of labour is two tasks originally: 1. Forecasting the internal supply meaning that the number and type of employees who will be in the firm at the some future date 2. Forecasting the external supply which means the number and type of people who will be available for hiring in the labour market at large. At higher levels of the organization, managers plan for specific people and positions. The technique mostly used is the Replacement Chart, which lists each important managerial position, who occupies it, how long he or she will probably staying it
before moving on, and who (by name)is now qualified to move to the position. This also allows ample time to plan developmental experiences for persons identified as potential successors to critical managerial jobs. To facilitate both planning and identifying person for current transfer or promotion, some organizations also have an Employee Information System or Skill Inventory. This system can locate all employees of an organization, who are qualified to fill a vacant position.
Employee Information System Contains information on each employee’s education, skills, experience, and career aspirations; it is usually computerized.
Forecasting the external supply of labour is a different problem altogether. How does a manager predict how many electrical engineers will be seeking work in Georgia three years form now? To get an idea of the future availability of labour, planners depend on information from outside sources such as state employment commissions, government reports, and figures supplied by colleges on the number of students in major fields. Matching Human Resources supply and demand After comparing future demand and internal supply, managers can make plans to manage predicted shortfalls or overstaffing. If a shortfall is predicted, new employees can be hired, present employees can be retrained and transferred into the understaffed area, individuals approaching retirement can be convinced to stay on, or labour – saving or productivity—enhancing systems can be installed. If overstaffing is expected to be a problem, the main options are transferring the extra employees, not replacing individuals who quit, encouraging early retirement, and layoff people.
Assess trends in • • • • External labour markets Current employees Future organizational plans General economic trends
Forecast internal supply
Forecast external supply
Compare future demand and internal supply
Plan for dealing with predicted shortfalls or overstaffing
Figure 2: Generally summarizes the process of setting up an effective plan of attracting Human Resource in an Organization
Recruiting Human resources Once an organization has an idea of its future Human resource needs, the next phase is usually recruiting new employees.
Recruiting is the process of attracting qualified persons to apply for the jobs that are open. Some recruits are found internally; others come from outside of the organization. Internal recruiting means considering present employee as candidates for openings. Promotion from within can help build morale and keep high—quality employees from leaving the firm. One disadvantage of internal recruiting, however, is its “ripple effect.” When an employee moves to a different job, someone else must be found to take his or her old job. External recruiting involves attracting persons from outside the organization to apply for jobs. External recruiting methods include advertising, campus interviews, employment agencies or executive search firms, union hiring halls, referrals by present employees, and hiring “walk—in” or “gate hires” (people who show up without being solicited). When hiring externally, most experts suggest providing what is called Realistic job Preview (RJP) for recruits. As the term suggests, the RJP involves providing a real picture of what the job is like.
Selecting Human Resources
Once the recruiting process has attracting a pool of applicants, the next step is to select whom to hire. The intent of the selection process is to gather from applicants
information that will predict their job success and then to hire the candidates likely to be most successful. Of course, the organization can only gather information about factors that are predictive of future performance. The process of determining the predictive value of information is called Validation. Application blanks— the first step in selection is usually asking the candidate to fill out an application blank which is an efficient method of gathering information about the applicant’s previous work history, educational background, and other job-related demographic data. However, they should not contain questions about areas not related to the job, such as gender. All this information is used to decide whether a candidate is worth further evaluation, and interviewers use the applications to familiarize themselves with candidates before interviewing them.
Tests— Tests of ability, skill, aptitude, or knowledge that is relevant to the
particular job are usually the best predictors of job success, although tests of general intelligence or personality are occasionally useful as well.
Interviews—although interviews are a popular selection device, they are
sometimes poor predictors of job success. Interview validity can be improved by training interviewers to be aware of potential biases and by increasing the structure of the interview. In a structured interview, questions are written in advance, and all interviewers follow the same question list with each candidate the interview. For interviewing managerial and professional candidates is less of a structured approach. Question areas and information—gathering objectives are still planning planned in advance, but the specific question vary with the candidates’ backgrounds.
Assessment Centers—Assessment centers are a popular method used to select
managers and are particularly good for selecting current employees for promotion. A typical center lasts two to three days, with groups of six or twelve persons participating in a variety of managerial exercises. Centers may also include interviews, public specking, and standardized ability tests. Candidates are assessed by several trained observers, usually managers several levels above the job for which the candidates are being considered.
Other Techniques—Organizations also use other selection techniques depending
on the circumstances. Polygraph tests, drug tests and physical exams are some of the techniques used.
Developing Human Resource
Regardless of how effective a selection system is, however, most employees need additional training if they are to grow and develop in their jobs. Evaluating their performance and providing feedback are also necessary. • Training and development
In HRM, training usually refers to teaching operational or technical employees how to do the job for which they are hired. Development refers to teaching managers and professionals the skills needed for both present and future jobs.
Assessing Training Needs—the first step in developing a training plan is to determine what needs exist. When a problem arises like employees do not know how to work necessary equipment, set up a good training workshop that help to resolve this need. On the other hand, when a group of office workers is performing poorly, training may not be the answer. The problem could be motivation, aging machinery, poor supervision or even deficiency of skills and knowledge. As training programs are developed, managers should set goals for employee to learn during these workshops.
Common Training Methods—many training and development methods are available. Selection of methods depends on many considerations, but perhaps the most important is Training content. When the training content is factual such as company rules, assigned reading, programmed learning, and lecture methods work really well in assuring that the information needed would be received well. When employees must learn a physical skill, methods allowing practice and the actual use of tools and material are needed, as in on-the-job training.
Evaluation of Training—Training and development programs should always be evaluated. Typical evaluation approaches include measuring one or more relevant criteria before and after the training and determining whether the criterion changed. Evaluation data is collected at the end of training are easy to get, but actual performance measures collected when the trainee is on the job are more important. • Performance Appraisal Performance Appraisal is a formal assessment of how well employees are doing their job. Employees’ performance should be evaluated regularly for many reasons. Appraisals may be necessary: for validating selection devices or assessing the impact of training programs; to aid in making decision about pay raises, promotions, and training; and to provide feedback to employees to help them improve their present performance and plan future careers. Common Appraisal Methods—Two basic types of appraisal methods are objective methods and judgmental methods. Objectives measures of performance include actual output, such as the number of units produced, dollar volume of sales, and number of claims processed. Another type of objective measure, the special performance test, is a method in which each employee is assessed under the standardized conditions.
Judgmental methods, including ranking and rating techniques, are the most common way to measure performance. Ranking compares employee directly with each other and orders them from best to worst. Rating differs from ranking in that the former compares each employee with a fixed standard rather than with other employees, with a rating scale providing the standard. The Behaviorally Anchored Rating Scale (BARS) is a sophisticated and useful rating method. Supervisors construct rating scales with associated behavioral anchors. Supervisors first identify relevant performance dimension and then generate anchors—specific, observable behaviors typical of each performance level.
Dimension: Punctuality Is this teller is always on time for work and promptly opens his or her window as scheduled? 1 4 2 3
Dimension: Congeniality Does this teller always greets his or her customer warmly and treats them with respect and dignity? 1 4 2 3
Dimension: Accuracy Is this teller always accurate in her or his work? 1 4 2 3
Figure 2: Graphic rating scales are a very common method for evaluating employee’s performance.
• Performance Feedback
The last step in most performance appraisal is giving feedback to subordinates about their performance. Feedback is usually provided in a private meeting between the person being evaluated and the person’s supervisor. The discussion is mainly focused on the assessed level of performance, how and why the assessment was made and how to improve in the future. Feedback interviews are not easy to conduct that is why managers are trained to conduct effective feedback interviews. A recent innovation in performance appraisal used in many organizations today is called “360 degree” feedback: managers are evaluated by everyone around them. Such a complete and thorough approach provides people with a far richer array of information about their performance than does a conventional appraisal given just by the boss.
Induction and Orientation
Induction and orientation are designed to provide a new employee with information he or she needs in order to function comfortably and effectively in the organization. Typically, induction and orientation will convey three types of information: •General information about daily work routine •A review of the organization’s history, purpose, operations, and products or services, and how the employee’s job contributes to the organization’s needs •A detailed presentation, perhaps in a brochure of the organization’s policies, work rules, and employee benefits. Employees feel anxiety when they enter an organization; they worry about whether they are adequate enough when compared to the experienced personnel or how the will perform on the job or even how well they will get along with the others. For these reasons, effective induction and orientation are deliberately aimed at reducing this anxiety. Information about the job is given, introductions are made and questions are answered.
The movement of personnel within an organization—their promotion, transfer, demotion, and separation—is a major aspect of human resource management. The actual decisions about whom to fire can also be among the most difficult, and most important, a manager has to make.
Promotions, Transfers, Demotions and Separations The possibility of advancement serves as a major reason for superior managerial performance, it is extremely important that promotions be fair. Even when promotions are fair and appropriate, they can still create a number of problems like surpassing a suitable employee for a particular job. This may in turn cause resentful feelings which may cause a drop of morale and productivity that said employee. The best way to prevent this to some extent is to make known of the favored candidate.
Transfers Transfers are used for a number of purposes. They are used to give people broader job experiences as part of their development and to fill vacancies as they occur. It also is used to keep promotion ladders open and to keep individuals interested in work, the same goes for both employees and manage
Demotions and Separations If employees or managers are proven ineffective in one position, they may be transferred, or asked to go for training or further development or even fired. Demotion is an infrequently used option, since in most cases the denoted manager and his or her former peers and subordinates find their continuing relationships difficult to handle.
Where demotion or other transfer is not feasible, it is usually better to separate than to let the poor performer stay on the job. It is helpful to keep in mind that poor performance does not necessarily mean incompetence. Any man or woman dismissed from one firm becomes a solid success in another. Thus, no matter how agonizing separation decisions may be, the logic of human resource planning and management development requires that they be made. When handled properly, separation can work out in the best interest of the individual, who may reach his or her full potential in a different environment, as well as ensuring more effective management for the organization. Some companies, in order o assist separated employees, provides outplacement services to help them find new and more suitable employment.
Maintaining Human Resource
Determining Compensation Compensation is the financial remuneration given by the organization to its employees in exchange for their work which is provided to employees with the means to maintain a reasonable standard of living. Beyond this, however, compensation also provides a tangible measure of the value of the individual to the organization. If employees do not earn money to meet their basic economic goals or feels undervalued, they will seek employment elsewhere. Thus a good compensation system can help attract qualified applicants, retain present employees, and stimulate high performance at a cost reasonable for one’s industry and geographic area. Determining compensation requires decisions regarding wage levels, the wage structure, and individual wages within that structure.
Wage—level decision - The wage-level decision is a management policy decision about whether the firm wants to pay above, at, or below the going rate for labour in the industry or the geographic area. Most firms choose to pay near the average or by intentionally paying more than average and thus attracting and keeping high— quality employees. Once managers make the wage-level decision, they need information to help set actual wage rates. Managers need to know what the maximum, minimum, and average wages are for particular jobs in the appropriate labour market. This information is collected by means of a wage survey.
Wage—structure decision-wage structure are usually set up through a procedure called job evaluation—an attempt to assess the worth of each job relative to her jobs. The simplest method for creating a wage structure is the rank job from those who should be paid the most to those who should be paid the least.
Individual Wage Decision—After wage-level and wage-structure decision are made, individual wage decisions must be addressed. This decision concerns how much to pay each employee in a particular job. Although the easiest decision is to pay a single rate for each job, more typically a range of pay rates is associated with each job. If the pay rate is $6.85 to $8.39 per hour with different employees earning different rates within the range; Rates may be set differently set because of the basis of seniority, initial qualifications or merit.
Determining Benefits—Benefits are things of value other than compensation that the organization provides to its workers. The average company spends an amount equal to more than one-third of its cash payroll on the employee benefits. Benefits come in several forms such as insurance, workers’ compensation, social security and most employers also provide private pension plan to which they and their employees contribute.
Managing Workforce Diversity
The meaning of Diversity- diversity exists in a group or organization when its members differ from one another along one or more important dimensions. Most important dimensions of diversity include gender, age and ethnicity.
The impact of diversity—there is no question that organization are becoming ever more diverse. This diversity provides both opportunities and challenges for organizations.
Diversity as a Competitive Advantage- Many organizations are finding that diversity can be a source of competitive advantage in the marketplace. Businesses that manage diversity effectively will generally have higher levels of productivity and lower levels of turnover and absenteeism thus lowering costs. In addition, organizations that manage diversity effectively will become known among women and minorities as good places to work, thus attracting qualified employees from among these groups. Moreover, organization with diverse workforces may have the edge in being able to understand different market segments. Finally, organizations with diverse workforces will generally be more creative and innovative compared to organizations in which the workforce is less diverse. Diversity as a source of conflict—Unfortunately, diversity can also become a major source of conflict. One potential avenue for conflict is when an individual thinks that someone has been hired, promoted, or even fired because of his or her diversity status. Another source stemming from diversity is though misunderstood, misinterpreted, or even inappropriate interactions between people of different groups. Conflicts may also arise as a result of fear, distrust, or individual prejudice. Members of the Dominant group in an organization may worry that newcomers from other groups pose a personal treat to their own position in the organization. Employees may also be unwilling to accept people who are different
from themselves. And personal bias and prejudices are still very real among some people today and can lead to potentially harmful conflict.
Managing diversity in organizations Because of the tremendous potential that diversity holds for competitive advantage, as well as the possible consequences of diversity-related conflict, much attention has been focused in recent years on how individuals and organizations can better manage diversity.
Individual Strategies—One key element of managing diversity consists of things that individuals can do. Understanding is the starting point. While people need to be treated fairly and equitably, managers must understand that differences do, in fact, exist among people. People should also try to understand the perspective of others. Tolerance is also important. Even though managers learn to understand diversity and may try to empathize with others, the fact remains that they may still not accept or enjoy some aspect of behavior on the part of others. Communication is also important. Problems often get magnified over diversity issues because people are afraid or otherwise unwilling to openly discuss issues that relate to diversity.
Organizational Approaches to managing Diversity—While individuals can play an important role in managing diversity, the organization itself must also play a fundamental role. The starting point in managing diversity is the policies that an organization adopts that affects how it treats people and how the organization addresses and responds to problems that arise from diversity. Organizations can also help to manage diversity though a variety of ongoing practices and procedures such as creating networks for various groups within the firm. Benefit packages can be structured to better accommodate individual situations. Differences in family arrangements, religious holidays, cultural events, and so forth may dictate that employees have some degree of flexibility ion when they work. Many organizations are finding that diversity training is an effective means for managing diversity and minimizing its associated conflict. More specifically, diversity training is training that is specifically designed to better enable members of an organization to function in a diverse workplace. Regardless of what
managers say or put in writing, unless there is a basic and fundamental belief that diversity is valued, it cannot ever become a truly integral part an organization.
Managing Labour relations
• How Employees Form Unions For employees to form a new local union, several things must occur. First, employees must become interested in having a union. Non-employees who are professional organizers employed by a national union may generate interest by making speeches and distributing literature outside the workplace and on the inside, employees who want a union must try to convince other workers of the benefits of a union. The second step is to collect employees’ signatures on authorization cards. The cards state that the signer wishes to vote to determine whether the union will represent him or her. Thirty percent of the employees in the potential bargaining unit must sign these cards to show the National Labour Relations Board (NLRB) that interest is sufficient to justify holding an election. Before an election can be held, the bargaining unit must be identified. The bargaining unit consists of all employees who will be eligible to vote in the election and to join and be represented by the union if one is formed. The election is supervised by an NLRB representative and is conducted by secret ballot. If a simple majority of those voting votes for the union then the union becomes certified as a official representative of the bargaining unit. The new union then organizes itself by officially signing up members and electing officers which set in place for the union to negotiate its first contract. If workers become disgruntled with their union or if management presents strong evidence that the union is not representing workers appropriately, the NLRB can arrange a decertification election. The results of such an election determine whether the union remains certified. Organizations usually prefer that employees not be unionized because unions limit management’s freedom in many areas. Management may thus wage its own campaign to convince employees to vote against the union. “Unfair labour practices” are often committed at this point such as to promise to give employees a raise if the union is defeated. The best way to avoid unionization is to practice good employee relations all the time, not when threatened by a union election.
Generate interest in union among employees.
If less than 30%of bargaining unit members sign the cards, the process ends
Collect signed authorization card.
Petition NLRB to hold election.
If union is rejected by majority vote, the process ends
Secret ballot election is held.
Union signs up members and elects officers.
Collective bargaining over first labour contract.
Labour contract signed.
Grievance procedure used to resolve disputes
during the life of the contract.
Figure 3: Displaying the different steps need to form a Local Union in an Organization
Collective Bargaining The intent of Collective Bargaining is to agree on a labour contact between management and the union that is satisfactory to both parties. The contract contains agreements about issues such as wages and hours; conditions of employment, promotion, and layoff; benefits; methods of allocating overtime, vacations, and rest periods; and the grievance procedure. The process of bargaining may go on for a long time according to the proposals and counterproposals made by the union and management respectfully. The resulting agreement must be ratified (giving consent) by the union membership. If it is not approved, the union may strike to put pressure on management, or it may choose not to strike and simply continue negotiating until a more acceptable agreement is reached.
The Grievance Procedure is the means by which the contract is enforced which usually concerns whether or not management is treating employees according to the contract. When employees feel that they have not been treated fairly under the contract, they file a grievance to correct the problem. The first step in a grievance procedure is for the aggrieved employee to discuss the alleged contract violation with her immediate superior, the problem is often solved at this stage. If the employees still believes that she is being mistreated, the grievance can be appealed to the next level. A union official can help the employee present her case and if the manager’s decision still doesn’t satisfy the employee then additionally appeals to higher levels until all in-company steps are exhausted. If still, the aggrieved employees still feels mistreated he or she can submit the grievance to a binding Arbitration. An arbitrator is a labour-law expert who is paid jointly by the union and management to study the contract, hear both sides of the case and render a decision both parties must obey. The grievance system for resolving disputes about contract enforcement heads off any need to strike during the tem of the contract.
Human resource Management is concerned with the attracting, developing, and maintaining of the human resource an organization needs. Its environmental context consists of the legal and social environments that affect the human resource management.
Attracting human resource is an important part of the HRM function. It starts off with Human resource planning, then Selection and Recruitment which are basic ways of attracting and hiring new employees.
Developing human resource management, organization needs to train and develop their employees to get maximum performance. The employees are evaluated to show experience in the required field of expertise.
Maintaining human resource is also important because of compensation which must be fair at all times. Properly designed incentive or merit pay systems can encourage high performance and a good benefits program can help attract and retain employees.
Group Work Marking Scheme
1. Relevant Content 2. Group Coherency 3. Teaching aids 4. Lecture notes 5. Overall final submission report 6. Questions and Answers from class TOTAL
15 3 5 5 7 5
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