Chapt02 Lecture

© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use.
Not authorized for sale or distribution in any

manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part..
Need To Know
1. Labor force composition trends and technological

developments how they affect HRM.
2. Areas in which HRM can support the goals of creating a high-
performance work system and expanding internationally.
3. Employee empowerment and its role.
4. Ways HR professionals can support organizational strategies
for quality, growth, and efficiency.
5. How the nature of employment relationship is changing.
6. How the need for flexibility affects HRM.
© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.. 1-2
2-2
The Labor Force
Internal Labor Force External Labor Market

• An organization’s workers • Individuals who are actively
includes its employees and seeking employment.
people who have contracts • Number and kinds of people
to work at the organization in external labor market
• Internal labor force has been determine kinds of human
drawn from the external resources available to an
labor market. organization.
2-3
Change in the Labor Force
Aging Workforce
Diverse Workforce
Skill Deficiencies
2-4
Generations
Today’s
Workforce
Baby Boomers Generation Y
Silent Generation X or
Generation Millennials
2-5
FIGURE 2.1
Age Distribution Of U.S Labor Force
2-6
HR Implications of an Aging Workforce
HRM spends much time on retirement

planning, retraining and motivating
workers.
Organizations struggle to Organizations
control rising costs of must find ways
health care and benefits to prepare
youth
Managers will supervise labor force.
older employees.
2-7
As more of the workforce
reaches retirement age,
some companies have
set up mentoring
programs between older
and younger workers so
that knowledge is not
lost but passed on.
2-8
Figure 2.2
Projected Racial/Ethnic Makeup of the

U.S. Workforce, 2022
2-9
HR Implications Toward Undocumented
or Illegal Immigrants
supply of and need to comply

demand for labor with laws
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part..
Figure 2.3
HRM Practices That Support Diversity

Management
2-11
Skill Deficiencies of the Workforce
Employers are looking for • Gap between needed

skills: and available skills has
 mathematical decreased companies
 verbal ability to compete.
 Interpersonal • Companies may lack
 computer capacity to upgrade
technology, reorganize
work, and empower
employees.
2-12
High-Performance Work Systems
Organizations have best fit between their:

 social system (people and how they interact); and
 technical system (equipment and processes).
Three trends in high-performance work systems:

1. reliance on knowledge workers
2. empowerment of employees to make decisions
3. teamwork
2-13
HRM Applications for Social Networking
2-14
Table 2.1
Top 10 Occupations for Job Growth
Knowledge Workers
Employees whose They are especially

contribution to the needed for jobs in:
organization is • health services
specialized knowledge of: • business services
• customers • social services
• processes • engineering
• profession • management
2-16
Test Your Knowledge
Ensuring that knowledge workers will share

information and store it so that it is easily
retrieved by others is the concern of which of
the following HR activities.
A. Turnover
B. Employee Empowerment
C. Knowledge Management
D. Employee Selection
2-17
Employee Empowerment
Employee Employee Engagement
Empowerment
Giving employees Full involvement in one’s
responsibility and work and commitment to
authority to make one’s job and company.
decisions regarding all This is associated with:
aspects of product  higher productivity
development or  better customer service
customer service.  lower employee turnover
2-18
Teamwork
The assignment of work Work teams often

to groups of employees assume many of the
with various skills who activities traditionally
interact to assemble a reserved for managers:
product or provide a • selecting new team
service. members
• scheduling work
• coordinating work with
customers and other
units of the organization
2-19
Test Your Knowledge
Sharon is a very smart and conscientious worker.

Lately, she has felt that her ideas were
disregarded and she was denied autonomy in
completing her work. This situation is probably
caused by a lack of
A. Employee Empowerment
B. Knowledge Management
C. Turnover
D. Teamwork
2-20
Figure 2.4
Strategic Business Issues Affecting HRM
2-21
Total Quality Management (TQM)
TQM is a companywide effort to continuously

improve the ways people, machines, and systems
accomplish work.
TQM approach provides guidelines for all the

organization’s activities, including HRM.
2-22
TQM Core Values
1. Methods and processes are designed to meet the

needs of internal and external customers.
2. Every employee receives training in quality.
3. Quality is designed into a product or service so
that errors are prevented from occurring.
4. Organization promotes cooperation with vendors,
suppliers, and customers to improve quality and
hold down costs.
5. Managers measure progress with feedback based
on data.
2-23
3 HRM Controls Cost
outsourcing reengineering
health
insurance
downsizing
2-24
Figure 2.5
Number of Employees Laid Off During

the Past Decade
2-25
Reengineering
A complete review of the organization’s major

work processes to make them more efficient and
able to deliver higher quality, including HRM.
Reengineering affects HRM in two ways:
• How HR accomplishes its goals may change.
• Change requires HR to help design and implement
change so that all employees will be committed to the
reengineered organization’s success.
2-26
Outsourcing
Outsourcing – the practice of having another

company, such as a vendor, third-party provider, or
consultant, provide services.
• Outsourcing gives the company access to in-depth

expertise and is often more economical as well.
• HR helps with a transition to outsourcing.
2-27
Mergers and Acquisitions
HRM should have a significant role in carrying out a

merger or acquisition.
• Differences between businesses involved in the deal
make conflict inevitable.
• Training should include conflict resolution skills.
• There is a need to sort out differences in the two
companies’ practices regarding compensation,
performance appraisal, and other HR systems.
2-28
Expanding into Global Markets
Offshoring International Labor Pool

• Moving operations • Hiring at home may
from the country may involve selection
where a company is of employees from
headquartered to a other countries.
country where pay • Immigration
rates are lower but the
necessary skills are
available.
2-29
Figure 2.6
Where Immigrants to U.S. Came from in 2012

HR Information System (HRIS)
A computer system used to acquire, store, manipulate,

analyze, retrieve, and distribute information related
to an organization’s human resources. HRIS can:
• support strategic decision making
• help the organization avoid lawsuits
• provide data for evaluating programs or policies
• support day-to-day HR decisions
2-31
Table 2.2
Technologies Influencing HRM
Cloud
computing, such
Shared Service
Internet Portal as application
Centers
service
providers
Business
Data mining
Intelligence
2-32
Electronic Human Resource Management
(e-HRM)
e-HRM: processing and transmission of digitized HR

information especially using computer networking
and Internet.
e-HRM has potential to change all traditional HRM
functions.
Self-Service: System in which employees have
online access to information about HR issues and go
online to enroll themselves in programs and provide
feedback through surveys.
2-33
Change In Employment Relationship
A New Psychological
Flexibility
Contract
Flexible Work
Flexible Staffing Levels
Schedules
2-34
Flexibility: A Family-Friendly Work Arrangement
2-35
Need for Flexibility Affects HRM
Organizations seek flexibility in staffing levels

through alternatives to traditional employment
relationship:
• outsourcing, temporary and contract workers
• flexible work schedules – including shortened work
weeks
• moving employees to different jobs to meet changes in
demand
2-36
Summary
• An organization’s internal labor force comes from
its external labor market
• U.S. labor market is aging and becoming more
racially and ethnically diverse.
• Organizations must recruit from a diverse
population, establish bias-free HR systems, and
help employees understand and appreciate
cultural differences.
• HRM can help organizations find and keep the
best possible fit between their social and technical
systems.
2-37
Summary (continued)
• Job design and appropriate systems for

assessment and rewards have a central role in
supporting employee empowerment and
teamwork.
• Employee empowerment means giving employees
responsibility and authority to make decisions
regarding all aspects of product development or
customer service.
• HRM must design jobs to give employees latitude
for decision-making and interpersonal skills.
2-38
Summary (continued)
 HR professionals should be familiar with the

organization’s strategy and may play a role in
developing the strategy.
 Specific HR practices vary according to type of
strategy.
 Organizations with international operations hire
employees in foreign countries where they operate,
so they need knowledge of differences in culture and
business practices.
2-39

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© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use.

Not authorized for sale or distribution in any

1. Labor force composition trends and technological

Internal Labor Force External Labor Market

Baby Boomers Generation Y

Age Distribution Of U.S Labor Force

HRM spends much time on retirement

Projected Racial/Ethnic Makeup of the

supply of and need to comply

HRM Practices That Support Diversity

Employers are looking for • Gap between needed

Organizations have best fit between their:

Three trends in high-performance work systems:

Employees whose They are especially

Ensuring that knowledge workers will share

The assignment of work Work teams often

Sharon is a very smart and conscientious worker.

Strategic Business Issues Affecting HRM

TQM is a companywide effort to continuously

TQM approach provides guidelines for all the

1. Methods and processes are designed to meet the

Number of Employees Laid Off During

A complete review of the organization’s major

Outsourcing – the practice of having another

• Outsourcing gives the company access to in-depth

HRM should have a significant role in carrying out a

Offshoring International Labor Pool

Where Immigrants to U.S. Came from in 2012

A computer system used to acquire, store, manipulate,

e-HRM: processing and transmission of digitized HR

Organizations seek flexibility in staffing levels

• Job design and appropriate systems for

 HR professionals should be familiar with the

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