All Lesson 1-4

any organization. It is an employee-focused office that serves all departments.
The schematic
diagram shows HR functions in detail.
HUMAN RESOURCE PLANNING

Coordination
Concentration
Consideration
JOB ANALYSIS/ JOB DESIGN; RECRUITMENT, SELECTION AND PLACEMENT

Acquisition
Allocation
Adjustment
TRAINING AND DEVELOPMENT; CAREER MANAGEMENT

Maintenance
Motivation
Measurement
PERFORMANCE APPRAISAL; COMPENSATION AND BENEFITS

Rewards
Retention
Remuneration
EMPLOYEE RELATIONS AND DISCIPLINE

Policies
Practices
Prevention
Figure 1 - Schematic Diagram of Human Resource Management
HRM is also defined as the proper handling of employees who are assigned different tasks and
given opportunities to grow in their careers, develop their skills, and avail of and enjoy the
benefits and rewards that the company provides. In exchange for these privileges, they are
expected to help the company achieve its strategic objectives.
Human resource planning is the first key function of HRM. Its responsibilities are coordination,
concentration, and consideration. Coordination is a term used in this book to describe how
HRM through human resource planning coordinates with the different departments to
strategize the right number of employees and positions needed in each department. Human
resource planning sees to it that there is a concentration of activities and tasks in each
department by making sure that the right number of workers and positions are obtained.
Consideration or the estimation of the costs of employment of human resources is also done in
human resource planning. By considering both the costs and the right number of employees,
human resource planning ensures that the organization has employed responsible and
trustworthy people who can attain the company's objectives.
Under job analysis/design and recruitment/selection/placement, the key responsibilities are

acquisition, allocation, and adjustment. As a component of this particular function of HRM,
acquisition of pertinent information about the jobs in the organization is vital. This is prior to
the actual recruitment of applicants. In line with the acquisition of information and applicants
for various jobs in the organization, the allocation of budget for different recruitment activities
which will help in the selection process is also an important component.
The three Ms in training and development and career management are maintenance,
motivation, and measurement of employees in terms of the growth and the enhancement of
skills. Maintenance keeps the employees' morale intact. Their zest for work keeps them loyal to
the organization. Motivation boosts their abilities and maximizes their potential. It intensifies
their quest to learn and improve their skills. Measurement quantifies the improvement of the
employees' performance based on the acquisition of new skills and the efficient/effective
discharge of their duties.
Under performance appraisal, employee movement, and compensation and benefits, the three
R’s are rewards, retention, and remuneration. Rewards provide the employees with the
benefits they deserve as well as re-assignments based on just and legal company policies and
procedures. Retention is the ability of the company to keep loyal employees to serve and help
meet the company's objectives. Remuneration is the fair and equitable provision of salaries and
wages in compliance to what is mandated by law.
The components of employee relations and discipline include policies, practices, and
prevention. The policies of the company keep the employees abreast of company rules and
procedures. They provide the parameters on how to discipline employees and ensure due
process in every disciplinary action. Practices shape an organization's culture and enhance the
employees' morale. Good corporate practices are ideal in bringing about a positive corporate
image not only outside the organization but more importantly, inside the company where
employees mingle with one another. Preventing harmonious relationships between employees
and the management from being broken is a component of employee relations and discipline.
Prevention promotes rapport and encourages trust and transparency between the employer
and employee.
Lesson 1
Human Resource Planning
It is difficult to imagine how a company can continue functioning without human resource
planning (HRP). To accomplish its mission and vision statements, which are specifically
highlighted in its strategic objectives, a company should effectively employ and utilize human
resources-manpower-in all aspects of its operations.
HRP means devising plans, strategies, and tools to provide the right number of people with the
right skills and qualifications at the right time. It is critical to highlight the link between human
resource planning and the overall strategies of the organization. The former specifically
determines the demand and supply of people in the organization.
HRP sees to it that the company can achieve its mission and vision by having the right people
with the right skills deployed in the right departments at the right time. One department
cannot function independently or avoid coordinating with the other functional departments.
The number of people as well as their skills, abilities, experience, and educational background
will always matter to the other departments since human resource is a core resource. The
accomplishment of the company's strategic objectives is always grounded on the following:
quality product/service offerings, a highly reputable corporate image, and competent and
reliable personnel.

Manpower demand and supply (number, skills and qualifications)
Finance
Marketing
Technical
Production
Research and Development
Figure 2 Link between Strategic Planning and Human Resource Planning
The strategic objectives of the organization in the different functions are accomplished with the
employment of people suited for the different tasks of each department. As mentioned in the
Introduction, HRP has three components: coordination, concentration, and consideration.
These provide the framework by which human resource planning accomplishes its tasks as a
key function in HRM.
COORDINATION
Bulla and Scott (1994, cited in Armstrong, 2009) define HRP as "the process for ensuring that
the human resource requirements of an organization are identified and plans are made for
satisfying those requirements" (p. 486) Reily (2003, cited in Armstrong, 2009) describes it as?
the process in which an organization attempts to estimate the demand for labor and evaluate
the size, nature, and sources of supply which will be required to meet the demand" (p. 481).
The HRP process is summarized in the following diagram.
Environment Scanning
SWOT Analysis
Forecasting Human Resource Requirements
Demand-Supply Analysis
Decision Analysis
Gap Analysis
Action Plan/ Program Implementation

Surplus
Shortage
Labor Equilibrium
Figure 3- Human Resource Planning Process
A. ENVIRONMENTAL SCANNING
Environmental scanning is critical to HRP because it assesses the factors that presently affect
the labor market as well as the ability of the company to respond to these factors. For example,
the current economic conditions have a great impact on the labor market. If unemployment is
generally high, it will be relatively easy for an organization to get an inexperienced, new
graduate for a customer service representative position. An increase in minimum wage, for
instance, may deter a company from hiring new employees at the moment due to budgetary
considerations. In another case, organizations may now be particular about educational
background, rather than experience. A master's degree is now a must for promotion purposes
or for better pay. Technological breakthroughs may decrease labor demand to a previously
labor-intensive company.
As a process, HRP looks at the organization's strengths, weaknesses, opportunities, and threats
(SWOT). SWOT reveals the current strengths of the organization and how they can be
maintained in terms of its market position or standing, how its products/services fare in the
market, and how its weakness in its current distribution set-up can reduce personnel capability
to transport its products in certain key cities. In terms of opportunities, there is a big chance for
the company to succeed in a new branch or area, even if the likelihood of failing or getting
surpassed in another area is not far behind. SWOT analysis can spell the difference between
getting new personnel, retaining the same number of people, or laying off some employees. It
is very critical in planning out the organization's manpower complement. The term describes
how many people are currently employed in the organization. It also describes how many
personnel occupying different positions are in each department.
B. FORECASTING HUMAN RESOURCE REQUIREMENTS

Forecasting refers to the decision maker's perception of a certain behavior based on an
objective study of the factors affecting the perceived behavior. In short, this is making
predictions based on critical factors to come up with a key decision. Predictions on human
resource requirements are an example.
CONSIDERATION
During the second stage of the HRP process, there are certain considerations that the HR should
deal with. To be successful, there is a need for an HR manager to be guided by the following
information (Bulmash, Chinnzer, and Speen, 2010):
1. The Human Resource Planning (HRP)

Team It should consist of individuals across all levels and departments who understand the
value of HRP in the organization. Once chosen, they should commit themselves to the
execution of the plan.
The following personnel should be considered in the HRP team:

a. Senior members of top management
b. Department managers
c. HR support professionals
d. Information technology (IT) professionals
e. Finance/Budget analysts
Top management provides the necessary support and the "go ahead" signal to execute the
plan. The department or line managers assist in analyzing the human resource requirements
and aligning them correctly in the organization. The HR professionals are the support group
that ensures that department managers are provided with all the help they need to implement
the process; The IT professionals undertake the process automation. The financial/ budget
analysts make the necessary linkages between human resource requirements and the
corresponding monetary limitations.
2. Current and Long-term Workforce Requirements

During HRP, there are certain changes that have to be made on the current workforce. The HR
department should replace those who are due for retirement; consider those who can be
promoted; and look into current vacancies that need to be filled immediately.
It is also important to be concerned with long-term workforce requirements. During HRP, a

succession scheme becomes crucial to key management positions. Employees who have the
potential to assume key positions later on should be identified and honed further to be future
executives in the organization. HRP also looks into skills that may be needed by the employees
in the future, working hand in hand with schools which offer specific courses that are required
for the company's betterment in the coming years. The beauty of HRP is that it not only takes
charge of future human resource requirements but also equips employees with the skills that
may be needed to attain the company's organizational goals.
3. Evaluation of the company's current roster of personnel

There is a need to assess how many regular or full-time employees and part-time or temporary
workers there are in an organization. The group of temporary hires is called contingent
workers. In evaluating the workforce, a skills inventory is needed. It entails comprehensive
information on an employee's educational background, experience, compensation history, and
specialized skills.
4. Assessment of external labor environment which affects the future supply of employees
The external environment is evaluated on the basis of the average number of graduates and the
corresponding courses per year, as well as the average age of the labor force. It is also
imperative to identify what industries are labor-intensive and which among them grow faster in
terms of profitability, as this can also affect the number of workers employed.
In economics, demand refers to the amount of goods/services that consumers are willing and
able to purchase whereas supply refers to the amount of goods/services that
suppliers/producers are willing and able to produce.
a. Forecasting external supply

In forecasting external supply, it is necessary to determine potential employees from
information available in government offices such as the Department of Labor and Employment
and the National Statistics Office. There are also private websites where one can access
employment statistics, and industry data (e.g.., People Management Association of the
Philippines [PMAP], JobStreet.com, and colleges/universities websites, etc.). The information
gathered from these sources can help in understanding future HR supply.
b. Forecasting internal supply

On the other hand, in forecasting internal HR supply, there are actuarial losses which are
unavoidable in any organization. Actuarial losses refer to life events like death, disability, and
retirement (Bulmash, et al., 2010). An organization can plan these life events through a study of
occupational health risks, medical histories of employees, and other data related to the average
age of the incumbent workforce.
Information on what causes turnover should be taken into account. The term turnover refers to
the total number of employees leaving the organization divided by the total number of
employees in an organization (as defined by www. businessdictionary.com).
There are two kinds of turnovers: voluntary and involuntary. A voluntary turnover refers to
resignations which are initiated by the employees. An involuntary turnover refers to dismissals
and layoffs initiated by the employer. Layoffs and dismissals are further discussed in Chapter 4
(Performance Appraisal and Employee Movements).
Methods of Forecasting Internal Labor Supply
Trend analysis.
It is a simple method used in forecasting internal HR supply. The main requirement in using
trend analysis is a record of past trends. Future trends can be predicted easily through past
retirement, hiring, and turnover patterns. For example, the company can assume it has a yearly
percentage of 5% retirement, 4% resignation, and 2% dismissal. Summing up, the trend of
turnover is 11% per year.
The advantages of using trend analysis are that it is easy and inexpensive. Information on past
trends can be accessed without difficulty as long as yearly HR audit is done in the organization.
However, trend analysis is limited to organizations with stable HR trends. In complex

organizations, trend analysis cannot be used alone. It can only be used as a preliminary step in
understanding the current workforce better. Another disadvantage is that in its simplicity, it can
ignore or overlook significant events which have occurred during the present year or recent
years.
Skills/Competency models.
Based on the information gathered from the skills inventory, the skills/competency model
matches the skills and competencies needed for each job with those of the employees in the
organization.
Competency includes skills, abilities, knowledge, and personal attributes and traits which are
needed for a particular position and the required tasks in such a position. Usually, an
organization considers the top performers and compares them to other employees.
Just like trend analysis, the competency model takes into account the HR audit. The advantage
of using this model is that it provides a good picture of the competencies of the employees
which helps in setting up an ideally competent workforce in the future. This kind of competency
model is also less costly and fairly easy to employ.
However, there are certain disadvantages caused by its reliance on the HR audit because there
is no guarantee that the past information contained therein is valid. Failure to obtain accurate
information in the past audit will make the competency model useless. Just like the trend
analysis, a competency model should not be the sole basis in forecasting HR internal supply.
Replacement chart.
It is used to identify vacancies in superior positions and the possibility of filling those vacancies
current employees through horizontal or vertical movements. In horizontal movements, also
called lateral movements, employees are transferred to another position but of the same level.
Vertical movements refer to promotions or the advancing in position such as from a supervisor
to a manager, or from a production operator to a supervisor.
The advantage of this method is that it clearly identifies the top performers and the vacancies
they can fill in the organization. Another advantage is the organization's easy identification of a
person who will fill a particular position in the future and the time to adequately prepare
people who will replace those leaving the superior positions.
However, the disadvantage of a replacement chart is that it can only be applied to internal
movements. The replacement chart can only rely on the employee's performance, education,
and readiness to fill the vacant position. The employee's age, gender, and civil status can be
included in the chart to gauge the potential of employees to be placed in higher positions.
Demographic information can be a source of bias, so it may occasion potential discrimination
(one employee is promoted instead of the other). An example is when a male employee is
promoted over a female employee with the same performance, education, and readiness to fill
the position.
Succession planning.
Unlike replacement charts, succession planning traces the potential replacements to key
positions and hones them to become successful future leaders. Succession planning is a long-
term process since grooming a successor entails training, mentoring, and coaching the potential
employee until the time that he/ she assumes the key position.
The obvious advantage of succession planning is that it adequately prepares successors to

assume key positions. On the other hand, it is disadvantageous and expensive to hone and train
a potential leader who may decide to leave the organization sometime in the future for a better
pay or position elsewhere.
Staffing tables.
They are a graphical representation of all jobs and the persons assigned to each job. The chart
aids the organization in understanding the current mix or combination of employees.
Staffing tables help the organization predict HR internal supply by assuming a constant mix of
employees in the organization. Using the chart, the organization can make adjustments
concerning the predicted number of employees in the future.
However, numbers do not indicate anything, making staffing tables mere preludes to more
complex forecasting methods.
Markov analysis.
It forecasts internal movements from one year to the next year by determining the percentage
of employees who remain in their jobs, are promoted, transferred, dismissed, or have resigned
for the organization.
The table below presents a simple matrix using Markov analysis for a 12-month period:
Table 1- Sample Markov Analysis
Positions
Production Manager
Production Supervisor
Production Worker
Resignation
20%
10%
10%
Manager
80%
20%
0%
Supervisor
0%
70%
10%
Production Worker
0%
0%
80%
In this example, the production supervisor has a 10% probability of resigning, a 20% probability
of getting promoted to a managerial position, and a 70% chance of remaining a supervisor next
year.
Each employee is rated on the probabilities based on projections. This type of analysis identifies
areas of high turnover so the organization can focus on the probable causes and how they can
be minimized. The Markov analysis is useful in identifying how many are likely to be promoted
so that the organization can prepare for possible vacancies created by those who will be
promoted.
On the other hand, Markov analysis may underestimate the size of the organization and such a
mistake will lead to a failure in forecasting. The company should be large enough to provide
pertinent information on the different jobs and occupations. Another disadvantage is that the
Markov analysis is only effective for stable trends. An organization with very high turnover rate
or periodic changes in the workforce cannot use it.
CONCENTRATION
The concentration of efforts is very crucial in the organization's achievement of its strategic
objectives. In determining the shortage or surplus of manpower, it is very important to forecast
future requirements.
FORECASTING HR DEMAND
In forecasting HR demand, the organization identifies human resource requirements including
the number of employees and the necessary functions that the employees need to perform.
There are a number of quantitative and qualitative methods of forecasting HR demand. The
three types of quantitative techniques are the following: trend analysis, ratio analysis, and
regression analysis.
1. Trend Analysis
It predicts demand for personnel based on past trends over a number of years between an
operational index (revenue per employee, productivity per employee, and the demand for
labor). Critical to the use of trend analysis is the choice of an operational index. For example, a
university will depend on the number of students who will enroll in a particular course to
predict the number of faculty members needed for that course. A pharmaceutical company
depends on the number of sales calls a sales representative make in a particular time frame and
location to predict the number of sales representatives needed in a particular territory.
The common practice is to have five years' worth of historical data for trend analysis. Trend
analysis makes forecasting HR demand easy. It is also not time-consuming since the historical
data are available at the HR's discretion. Furthermore, it is inexpensive since there are new soft
wares and systems that can perform it.
However, trend analysis is based on only one criterion at a time. For example, a hotel may only
consider one factor such as the number of rooms cleaned by a housekeeper in a given time
frame to predict the number of housekeepers needed. Another disadvantage is that it may be
subjective, depending on the discretion of the one doing the trend analysis on the choice of
operational index.
2. Ratio Analysis
It predicts HR demand based on ratios between selected factors and the number of employees
needed. For example, in 2012, the actual sales of a company was P30 million with 150
employees. In 2013, the company predicts sales of P40 million. How many employees are
needed? Using ratio analysis, one can deduce:
30,000,000/150 = 40.000,000/x
30,000,000= 6,000,000,000
x = 6,000.000.000/30.000,000
x = 200 employees
Using the actual headcount of employees in 2012, the predicted number of employees in 2013
is shown in the table below.
Table 2 - Actual and Predicted Headcount Using Ratio Analysis of a Hypothetical Company
Level
Managers (Prod)
Supervisors (Prod)
Prod Operations
Managers (Non- prod)
Supervisors (Non-prod)
Staff
Sales Representatives
Total
Actual Headcount in 2012

3
5
76
8
5
20
33
150
% of Workplace
2%
3.33%
50.08%
5.33%
3.33%
13.33%
22%
100%
Predicted Number of Employees in 2013

4
7
100
11
7
27
44
200
Prod-Production Non-prod- Non-Production
It is assumed that each level is fixed. The advantage of using ratio analysis is that there is no
need to get five years' worth of historical data to forecast HR demand, it is also easy to use.
Previous sales information is readily available to predict HR demand. Schools usually predict the
number of faculty to hire based on the past years' enrollment. Ratio analysis is very useful for
benchmarking purposes within the industry.
However, ratio analysis may predict inaccurate sales growth. It is always good to be
conservative in predicting sales growth since there are uncertainties in the environment that
may affect sales.
3. Regression Analysis
The more complex method of forecasting HR demand is regression analysis. It is a statistical
method of predicting HR demand by determining the relationship between various factors
(independent variables) and the company's employment level (dependent variables).
Table 3 shows the magnitude or strength of the Pearson correlation coefficient (Hair, et al.
1998) which indicates the relationship between the independent and dependent variables.
Table- Magnitude of Correlation Coefficient

Correlation
None
Small
Medium
Strong
Negative
-0.09 to 0.00
-0.30 to -0.10
-0.50 to -0.30
-1.0 to -0.50
Positive
0.00 to 0.09
0.10 to 0.30
0.30 to 0.50
0.50 to 1.00
For example, if the correlation is 0.88, it is interpreted that the increase in sales is accompanied
by an increase in the number of employees. If the correlation is -0.80 between investment in
technology and the number of employees, the additional investment in technology may
decrease the number of employees in the organization.
In the first example, the company projects additional employees with an increase in sales. The
second example shows that investment in technology would result in a decrease of employees.
The organization should now find out how many employees will be affected by the investment
in technology.
Regression analysis is advantageous because it predicts the effect of a particular factor on the
number of employees. As a result, the company can think of ways to improve the workforce in
the future. Biases and subjectivity are removed since it uses mathematical formulas to make
predictions.
This method is difficult for it may take some time to fully use and understand the data
generated by regression soft wares. Management should receive proper training on how to
interpret the data.
The main types of qualitative techniques are the following: Delphi method, nominal group
technique, and scenario analysis.
1. Delphi Method
This method uses a panel of experts to project the number of personnel through various factors
such as economics, demographics, and the technological and social conditions of the
environment. There are also internal factors used such as educational background, experiences,
and productivity of the workforce.
The Delphi technique uses a "middle person" to gather the data of each of the members of the
panel who are assigned to make manpower forecasts. The middle person provides a copy of the
forecasts to each member of the panel as they make comments to each other's forecasts
anonymously. The role of the middle person is to summarize the comments of the panel. The
process continues until a consensus is reached. The technique may take some time due to the
process of passing on among the members of the panel each of the forecasts anonymously.
The Delphi technique is ideal because judgments come from a panel of experts and sources of
information are verified before they are used during the deliberation.
However, the process is time-consuming and somewhat subjective in nature. Another

disadvantage is that some experts cannot help but disclose their judgments to others, especially
when they are working in close proximity to one another.
2. Nominal Group Technique

Unlike the Delphi technique, the nominal group technique uses a panel of experts, mostly line
managers, who discuss, meet face to face, and project HR demand.
Advantageously, the panel of experts will strive very hard to come up with an accurate forecast.
Another advantage is that the assessment can lead to solving other organizational issues.
The disadvantage of this technique lies in the subjectivity of the assessment of the experts.
Biases cannot be avoided when assessments are done by people. It is also time-consuming
since discussions are done until confidence in the results is obtained.
3. Scenario Analysis
This method applies multiple scenarios to predict HR demand, based on a number of
assumptions. Because of the unpredictability of the future, an organization may opt for
different scenarios, each with corresponding predictions based on the characteristics of a
particular situation. For example, a company may forecast HR demand on three economic
conditions: a stable economy with no growth; a growing economy with a 5% growth, and a not-
so-good economy with a 5% decline. Experts in the organization then meet and discuss internal
and external changes which will impact HR demand forecasts. With the three scenarios, for
example, internal and external changes are combined to create a forecast for each scenario.
The internal changes include adopting new technology, productivity programs, and other
changes. External changes include increasing competition within the industry where the
organization operates and additional incentives or legal requirements from the government,
among others.
This method is beneficial because it provides different scenarios which make the organization
very flexible in facing the future. It is also very useful when past trends do not necessarily
become the best predictors of the future. It is also advantageous in an environment which
continues to change. Anticipating different scenarios can safely lead the organization to future
exigencies.
There is one caveat: the organization must keep on monitoring factors that influence the
scenarios created.
C. DECISION ANALYSIS
During this stage, HR conducts a gap analysis-the process of finding the difference between the
forecasted HR supply and HR demand. Decision analysis identifies three crucial decisions: a
labor equilibrium (where HR demand equals HR supply), a shortage of workers (where HR
demand is more than HR supply), and a surplus of workers (where HR supply is more than HR
demand). Labor equilibrium is an ideal situation but this happens rarely.
D. ACTION PLAN/IMPLEMENTATION OF THE PROGRAM

After gap analysis and a particular decision is obtained (e.g.., a labor equilibrium, shortage, or
surplus), the organization is now ready to identify the strategies for its implementation.
a. Labor equilibrium or labor demand equals labor supply

During labor equilibrium or status quo, current employees are trained and developed further in
their respective fields. There are also instances when employees are transferred from one
department to another based on their experience and educational background.
b. Labor surplus or labor supply is more than labor demand

The company has several options when there is a labor surplus. When this occurs, the company
looks at the attrition rate of the employees. Attrition is the normal separation of employees
from the organization such as resignation or retirement
The company may also opt to offer an early retirement program for those who have reached
the age of fifty. An early retirement package should be planned carefully in order for it to
effectively entice people. A higher separation pay will enhance the offer's appeal.
Another option is to declare a hiring freeze. A hiring freeze prevents new hires and assigns
qualified incumbent personnel to fill job vacancies. Layoff is another option of a company that
wants to get rid of redundant positions since some manual services or functions may no longer
be needed because of technological innovations.
When a layoff occurs, the company reviews the performance of its current workforce and may
decide to terminate employees with consistently low performance ratings for the past several
years.
c. Labor shortage or labor demand is more than labor supply

There are several ways to address labor shortage. The first option is to schedule overtime work
hours. This is an additional cost to the company, but it may help in avoiding work backlogs on a
temporary or project-based basis. Another workers option There is to hire are
contractual/temporary workloads or projects that will last only for a short time like six months.
Temporary workers can be hired. Another option is to outsource the work. Instead of hiring
directly, a company may use a third party and let the latter get its own people to do the tasks
such as customer service. A possible option is to tap top performers for promotion. This can
motivate the workforce to perform well always.
Lastly, a labor shortage can be solved by external recruitment. There are several methods on
how to recruit the best people qualified to fill the vacancies in the organization.
Once the company chooses a particular strategy based on the three scenarios, the organization
prepares a budget and provides a working plan on how to implement the chosen strategy.
HR POINTS TO PONDER

You are assigned to review your current workforce and the recruitment processes. The plan is
to have a set of diverse yet complete group of workforce. This is the first time that you will
handle such a task.
Rank your priorities according to importance.

1. Plan a grand job fair inviting possible applicants for key positions.
2. Coordinate with schools and universities which have excellent and outstanding graduates.
Get in touch with their alumni associations as well.
3. Analyze the competencies of the current workforce.
4. Review the hiring process in the past as well as the tenure of the current employees.
TRENDING IN HR
OUTSOURCING HR
(Adapted from Top Ten Human Resource Trends of the Decade by Susan Heathfield, retrieved
at www.about.com on December 15, 2012, Human Resource (HR) Outsourcing at
www.outsourcing.ph on December 15, 2012)
The human resource function has now become more strategic in nature. It is strategic in the
sense that presidents or chief executive officers (CEOs) of companies are now looking at the HR
from a different standpoint. They now expect HR people to work towards organizational
development, change management policies, plan successions, and the like. There are no more
questions regarding the traditional routine jobs such as sorting of documents. 201 file
management, and the like.
Human resource planning is now looking into outsourcing the routine functions of records
management, payroll computation, and resume sorting The more strategic and challenging
tasks are what CEOs are looking for, and it is likely that the HR function will be more dynamic
and challenging than ever.
In contrast to what many people think, the idea that the HR department as the depository of
employee information is a misconception. On the contrary, it is the core of any organization, it
attracts, develops, and maintains individuals who possess the skills and knowledge needed to
achieve the company's goals.
Outsourcing used to be a means to reduce costs. But today, outsourcing is an effective means
of taking out the routine tasks which are time-consuming, demotivating, and boring to many
employees. Outsourcing helps HR executives concentrate on important and critical issues which
confront their respective organizations and challenge their analytical thinking and problem-
solving abilities to provide solutions to organizational problems.
The HR functions that are now being outsourced are the following: benefits and payroll
administration, training, recruitment, and performance evaluation, among others.
HR FOREFRONT
A QUICK LOOK INTO HUMAN RESOURCE PRACTICES IN EDUCATIONAL INSTITUTIONS

In a study made by the author covering A.Y. 2011-2012 in five private, Catholic higher education
institutions (HEIs) in Manila, the most common problems encountered related to human
resource practices are competitiveness of salaries and benefits, recruitment of qualified and
competent faculty, and maintenance of quality teaching and instruction.
The study made by Dr. Balatbat (2010) also affirmed the findings of the author in relation to the
hiring of competent teachers. She also stressed the importance of faculty support through
professional development and the provision of attractive salaries.
What is the role of human resource planning in the recruitment of qualified and competent
faculty members in schools?
LESSONS IN HRM
HISTORICAL BACKGROUND OF HRM

(Adapted from: www.buzzle.com.Rashida Khilawala, Jan. 10, 2013;
www.hrknowledge.blogspot. com, The Historical Review of Human Resource Management,
January 27, 2010; Historical Background of Human Resource Management by Kaizenlog,
September 6, 2006 on www. webpronews.com; David A. DeCenzo and Stephen P. Robbins,
Human Resource Management, 2009; www.projectguru.in Knowledge Tank by Priyn Chetty on
May 23, 2012 and What is KM? Knowledge Management explained by Michael D. Kooney, May
4, 2012 at www.kmworld.com)
The roots of human resource management can be traced back to the prehistoric era where
human resource principles like those used to develop tribal leaders existed. Records have
shown principles regarding safety, health, hunting, and gathering food were passed on to the
succeeding generations.
From 2000 to 1000 BC, the more advanced functions were used by the Chinese. They were the
first to use screening techniques for applicants in 1115 BC. The Greeks, on the other hand,
started using apprenticeship in 2000 BC. These were the first human resource practices in
employee selection and training.
The development of small- to large-scale production led to the establishment of organizational

structures that paved the way for recruiting a large number of people. The organizational
structure helped in separating the bureaucracy or the more privileged employees and the rank
and file/workers. Through the years, the gap between the two has widened. Thus, there was a
glaring need for human resource management practices.
The working class (those who were less privileged) started to question the growing power of
the aristocracy. This criticism led to the development of trade unions which became a platform
for collective action as an expression of rights and privileges. The advent of the labor unions in
1790 led to the considerable power of the working class in the 1800s and 1900s.
The growing concerted actions hastened numerous policies for industrial welfare, in 1833,
legislation mandating the hiring of male factory inspectors were started. Then in 1876,
legislation regulating work hours for children and women to 60 hours per week was done.
In 1868, the first trade union conference was held and collective bargaining first appeared.
Meanwhile, Frederick Winston Taylor (1856-1915) wrote a classic book, The Principles of
Scientific Management, which advocated dynamic and scientific principles in managing people.
The following are Taylor's scientific dicta:
1. Each aspect of a person's work is analyzed scientifically.
2. The person suited for the job is chosen scientifically and is taught exactly how to do the job
3. To ensure a scientific way of doing the job, managers must cooperate, with workers.
4. Division of work and responsibility is evident between management and workers.
Taylor's scientific management had a major impact on the visibility of human resource
management in the world of work. He introduced the concepts of work design, work
measurement, and production control.
The B.F. Goodrich Company pioneered in having an employee-focused department which

addressed employee-related concerns. In 1913, the U.S. Department of Labor was established.
In 1916, the armed forces focused on IQ (general mental ability/intelligence quotient) testing.
In 1921, on the other hand, the National Institute of Psychologists in the U.S. studied and
published results in testing, interviewing, and training.
The Hawthorne studies which measured the relationship between productivity and the work
setting were conducted from 1927 to 1932. The studies of Elton Mayo used a set of
experiments in Western Electric Plant, Hawthorne, Chicago in the state of Illinois. The studies
showed that the environment has a considerable effect on the workers' productivity. Thus, the
Hawthorne studies helped in improving the physical conditions for the employees. It also
focused on the efficiency of workers through work satisfaction.
The Wagner Act of 1935 is the National Labor Relations Act. The Social Security Act of 1935
ensured the welfare of employees after retirement. The Fair Labor Standards Act of 1938 was
enacted, generating minimum wages for laborers.
Mayo's Hawthorne studies gave rise to the Human Relations Movement. This movement
advocated that people not only have needs for learning but also needs for support, recognition,
and self-worth. The movement presented the worker as an "individual" which is in contrast to
Taylor's scientific management which focuses on the worker's "task."
The human relations movement gave rise to various reforms between 1960s and 1970s. The
following laws were passed: The Equal Pay Act of 1963, the Civil Rights Act of 1964, the
Employee Retirement Income Security Act of 1974, and the Occupational Safety and Health Act
of 1970. All these laws were passed to ensure the welfare of the employees. The disabled
people were protected against discrimination through the Americans with Disabilities Act in
1990.
Furthermore, flexibility of work hours were sought in 1990. The trend for flexible arrangements
was in response to the increasing number of people who are working in temporary, part-time,
and distance-working positions.
The diversity of workers around the world plus the impact of globalization ushered in the use of
the Internet in recruitment. There was also an influx of jobs through e-commerce in 2000. With
these changes in the work environment, HRM has become more complex. The historical review
of HRM is discussed further by the concepts that enable HRM to manage people more
comprehensibly.
PERSONNEL MANAGEMENT
The precursor of the term human resource management is personnel management. In the early
days, the personnel function is confined to keeping records of employees, Personnel
management is merely an administrative and record-keeping function. In the 1920s, personnel
administration was concerned largely with the technical aspects of handling people, specifically
in the U.S. Many years ago, personnel management did not relate personnel functions with the
accomplishment of company goals and objectives.
Personnel management became HRM in response to the increasing pressures most American
businesses were experiencing at that time (late 1970s) when the world was slowly embracing
technological changes and globalization. It came to a point that businesses have to align all
departments in a strategic stance to achieve organizational effectiveness.
HUMAN RESOURCE DEVELOPMENT

Human resource development (HRD) is one aspect of HRM that deals with training and
development. The aim of HRD is to have a dynamic, growth oriented workforce. HRD helps in
unlocking the potentials of the employees and developing their skills and abilities. It includes
employee training, career development, performance management, coaching, succession
planning, and organization development.
HUMAN CAPITAL MANAGEMENT

Human capital management (HCM) complements HRM as it focuses on providing a strategic
approach to managing a company's staff. HCM helps a company organize a full-blown strategy
even before employees are hired until their exit. HCM also employs succession planning and
talent management. It takes note of what people can contribute to organizational success and
strengthens the importance of people as assets rather than as costs. It also emphasizes the role
of HR specialists as business partners. It champions the idea that the strategic role of human
resources is to create values that are important in the achievement of organizational goals.
TALENT MANAGEMENT
One aspect of HCM is talent management. It is the process of attracting highly skilled workers
and retaining them. The responsibility of attaining both of these processes rests on all the
managers in the organization. Talent management involves key HR functions such as
educational qualifications and skills, experiences, training, and potential and personal qualities
of employees. Highly reputable universities or colleges may engage in talent management as
they retain a pool of highly skilled faculty to attract students to enroll in the different course
programs they offer.
KNOWLEDGE MANAGEMENT
Knowledge management, on the other hand, is the effective and integrated approach
information to assets. Identify. Aside capture, from documents evaluate, retrieve, and
databases, and say, share the HR biggest needs a company's to source take care of knowledge
of employees is the who expertise provide of the employees. expertise Needless and skills to
meet organizational goals.
LESSON 2
RECRUITMENT, SELECTION, AND PLACEMENT
This chapter focuses on recruitment, selection, and Placement and discusses job analysis and
job design. These aspects are crucial prior to the actual function of recruiting personnel. The
key components of this function are the following: acquisition, allocation, and adjustment.
Job analysis is the process of gathering all the needed information which is important in a
particular job. The collection of data is vital to recruitment, selection, and placement. This is
when job descriptions are made. Job descriptions are written summaries of various jobs
consisting of duties, responsibilities, and qualifications. Once job analysis is done, the
information gathered will help in designing jobs. If there is a need to redesign jobs, it is for the
purpose of achieving the company's objectives.
These two functions pave the way for recruitment, selection, and placement. Recruitment is the
process of allocating qualified applicants who apply for various positions in a particular
organization. The process of selection and placement is rather tedious. It requires a keen and
analytical mind to make such selection decisions.
Adjustment refers to the different ways by which the organization together with new
employees adapt to the work environment. This includes the organizational structure with the
inclusion of new employees.
ACQUISITION
The acquisition of information related to the jobs in the organization is done in job analysis.
Usually, this is executed in organizations that have already existed for quite some time. The
reason for this practice is that since these companies have existed for a number of years, and
they have more or less actual work experiences based on job titles or positions, therefore, they
have adequate knowledge concerning the said jobs.
Job analysis is the procedure of determining the duties and skill requirements of a job and the
kind of person who should be hired for it (Dessler, 2010).
The following information can be collected through job analysis:
1. Specific tasks and activities

A job analyst can obtain information on the different tasks required by a job such as painting,
drafting, writing, teaching, encoding, and cleaning skills. Additional information includes how
these tasks are done, the specific time they are performed, and the reasons why they should be
performed.
2. Required behavior on the job

Information about the behavior required in the performance of various jobs such as
communicating, writing, computing, driving, forklifting, among others.
3. Required job standards

The job analyst can also gather information regarding the performance levels or standards
required by the job. This is needed to evaluate the performance of the employee.
4. Knowledge, tools, and equipment used

Information on the tools and equipment used by the employee can be gathered during the job
analysis. Knowledge of software applications, accounting procedures, and law, among others, is
also taken into account
5. Work conditions
These include the physical aspects of the job such as work schedules, physical environment
(e.g.., field work in the case of sales representatives, or a factory set-up in the case of a
production operator) and so on. Information on social contact is also obtained (e.g.., the kind of
people the employee interacts with, like suppliers in the case of a purchasing manager, or
students in the case of a teacher).
6. Personal characteristics and requirements

These include the educational background, training or experience, as well as type of
personality, attitudes, values, and physical characteristics needed for the position.
To understand further the job analysis function, the diagram on the next page summarizes the
process through a number of steps.
Formulation of objectives S
election of jobs
Application of job analysis techniques
Preparation of job description and job specification
Actual conduct of job analysis
Selection of jobs
Figure 4- Job Analysis Process
1. Formulation of objectives
In this step, the firm identifies and formulates the goals of the job analysis. It determines how
the job analysis will be used.
2. Selection of jobs
Large organizations usually have many jobs. Since job analysis is a time-consuming process, jobs
to be analyzed are carefully selected.
3. Application of job analysis techniques

There are many techniques that can be used in conducting a job analysis. Proper selection of
the appropriate techniques will be less costly for the organization.
4. Actual conduct of job analysis

The actual data gathering needs considerable time and effort since the data include the
features of the job, the proper attitude towards the job, and the characteristics of the
employee who will perform the job.
5. Preparation of job description and job specification

After data gathering comes the time to write the job description for each job analyzed.
The job description lists the duties, responsibilities, reporting relationships, and the job
specifications for each job. Job specification refers to the minimum qualifications required by a
particular job such as educational background, experience, skills, and abilities.
The preparation of job description and job specification is the heart of job analysis. They are
used in the following HR activities:
a. HR planning
During HR audit, the job descriptions of all jobs are reviewed. This review is necessary to assess
which of the jobs are available, which jobs should be combined, and how many jobs may be
needed in the future.
b. Recruitment and selection

Job specification is needed by the HR Department to update the educational background of
each employee and align it to the requirements of his/her work. A good job analysis can also
validate and ensure good decision-making in recruitment and selection.
c. Compensation
Compensation indicates how much money an employee is paid for doing a certain job based on
the tasks and responsibilities attached to it.
d. Training and development
Information obtained from the job analysis can help in the employee's development. The HR
department can identify the skills the employee should have to improve on the job.
e. Performance appraisal
Performance standards are set during job analysis. This assessment can help supervisors set up
better performance measures.
f. Safety and health

The information obtained from employee's evaluation of working conditions can help the HR
department eliminate health hazards to ensure work safety.
g. Labor relations
Job analysis helps in determining whether certain aspects of a job can be covered by union
agreements. It helps in avoiding future conflicts between the management and the union
regarding the coverage of jobs negotiated for the employees.
The following are a various job analysis techniques:
1. Observation
There are jobs that can be observed like those performed by an assembly line, service crew, or
warehouse workers. It is crucial to identify key job behaviors. The job analyst should not
interfere while the job is being performed.
This method is very useful for repetitive jobs. Nonetheless, there are jobs that cannot be
observed like researching or computer programming. People who perform jobs like these
usually do analytical tasks that may be hard to observe. Therefore, they require different modes
of observation.
2. Interviews
Another technique is the interview. The interview allows a face to-face interaction between the
job analyst and the interview. It provides an opportunity for the job analyst to clarify vague
points and creates a venue for a pleasant interaction interaction between allows the the job
employee analyst and to the job analyst. This personal obtain relevant information.
However, the interview becomes tedious for the job analyst especially when he/she is
interviewing more than one employee performing the same job. There may also be some
inconsistencies based on how the job analyst interprets the facts from the interviews.
3. Questionnaire
The use of questionnaire is one of the least expensive tools for data gathering. It usually
includes the duties and responsibilities, working conditions, equipment used, and requirements
of the job. The questionnaire is usually structured and, therefore, very convenient to answer.
Through the questionnaire, it is very easy to clarify confusing points because it is a face-to-face
discussion. Another advantage is that it is less tedious for the job analyst since the
questionnaire is distributed and answered by a large number of employees in a short period of
time.
However, the accuracy of the answers to the questionnaire rests on the employee-respondents.
It also depends on how they understand the questions and their capacity to answer them.
4. Logbook
The logbook is a good source of data regarding employee duties how frequently they have to be
done and when they are scheduled to be finished. There are certain jobs that require the use of
logbooks and more often than not, these jobs are quite hard to observe. One of these jobs is
that of an engineer. The job is often very detailed and a job analyst may have a vague view on
the tasks being performed. It is also quite a complicated work, and a job analyst may skip some
important aspects pertaining to it. Logbook-keeping is the best technique to use.
However, it may be time-consuming for the job-holder to always keep a record of his/her
performance. There is also the possibility of recording exaggerated reports on the tasks being
performed because the job-holder is the one who personally logs his/her own performance.
There is no best method and usually, an organization depends on the objective or purpose at
the moment as well as considers time and budget constraints before conducting a job analysis.
The job description is one of the main reasons why a job analysis is conducted. A job description
is a written summary of the particular job. It provides a clear overview of what the job is all
about and minimizes inconsistencies in the actual job and what is actually written.
The job specification is a part of a job description. It is found in the lower part of the job
description and contains the educational qualifications, skills, experience, and traits that a job
holder should have in order to become effective in the job.
To sum up, a job description has the following parts:

a. Job title or position
This describes the exact job title or designation Manager or HR Assistant, and Production
Manager, others.
b. Reporting relationships
This includes the job title for the position's supervisor. In the case of an HR Manager, the
supervisor may be a Vice President for HR or HR Director. reporting relationship also includes
the subordinates the HR Manager's supervision. The HR Manager HR Supervisors under his/her
supervision. The have different areas like HR Supervisor-Recruitment, Supervisor-Training and
Development, HR Compensation and Benefits, and HR Supervisor-Employee Relations.
c. Job classification
In large companies, job titles have different job levels, Classification provides the rank or
position of in the hierarchy of the various jobs in the company.
d. General description of the job

This portion provides a summary of the job and overview of its duties and responsibilities.
e. Specific duties and responsibilities

These include and clarify the functions of the detail. Usually, the specific functions start with a
show an element of action. For example: "Assists the President in the implementation of
human resource and procedures to all employees.
f. Job specification
As discussed earlier, it lists the minimum requirements of the job.
The parts given are the commonly-used ones, although there is no standard format as to how
job descriptions are written. In some companies, a job description also contains the working
conditions and the equipment used.
The job design is usually formulated after a job analysis. There are some companies that make
some modifications on certain duties of jobs to achieve the company's goals and objectives. Job
design is the process of work arrangement aimed at reducing or overcoming job dissatisfaction
and employee alienation arising from repetitive and mechanistic tasks
(www.businessdictionary.com).
Job design is commonly divided into two basic categories: job enrichment and job enlargement.
The horizontal approach to job design is job enlargement. A supervisor gives his/her
subordinates more tasks to do. There are different duties to perform, and the employee is not
empowered to decide on his/her own. He/she has no authority in decision-making.
Job enrichment is the vertical approach of job design. It satisfies the need for growth since the
employee has a hand in decision-making. He/she is empowered and has some authority over
certain tasks. In this case, he/she is motivated to become more responsible. Hence, the
employee eventually enhances his/her self-worth.
Here are the following job design principles based on the job characteristics model by Hackman
and Oldham (Parker and Hall, 1998):
a. Task variety
The company should attempt to provide employees with a variety of tasks. However, one
should note that too much variety can result in inefficiency whereas too little can lead to
boredom.
b. Skill variety
Using a number of their skills makes employees happy.
c. Feedback
The employees should be informed if they have already reached their required targets.
Eventually, employees should learn to set the standards of work quality and quantity they will
follow.
d. Task identity
Each group of tasks should be clearly defined, visible, meaningful, and separated from one
another.
e. Task autonomy
Employees should have some form of control over their work. They should be empowered to
decide on some aspects of the job
ALLOCATION
The allocation function is used in recruitment, selection, word allocation signifies the
meaningful hiring of employees It becomes meaningful in the sense that the HR department
the factors that may affect the recruitment process.
The following diagram summarizes the recruitment, selection, and placement function.
Recruitment
Planning and Approval based on Hr Planning
Position Announcement
Selection of Recruitment Strategies
Selection
Psychological Testing
Screening/Interview and Background Check
Job Offer and Negotiation
Placement
Post-selection Consideration: Pre-employment Requirements, and Medical Examination
Hiring
Signing of Employment Contract
Figure 5- Recruitment, Selection and Placement Model
RECRUITMENT
Proper allocation entails placing the employees in the right departments and making sure they
are equipped with the right skills and experience for the job. Before starting allocation,
recruitment should be defined first. Recruitment is the process of attracting applicants qualified
to occupy vacant positions in the company. It consists of various activities that entice and
influence qualified applicants to fill these vacancies.
The following are the main steps in recruitment:

1. Planning and approval based on HR planning
The recruitment function starts with the management's decision to recruit based on the
findings taken from HR planning sessions. There are two different types of planning which occur
in well-managed organizations (Jacobson, 2010). The first type utilizes strategic thinking about
the future needs, challenges, and opportunities of the organization's personnel. This requires
research, critical thinking, and the willingness to change. The second type is the operation of
strategic plans when positions become available. Therefore, thorough planning is done before
the actual recruitment process takes place (Lavelle, 2007).
Even though much is done during HR planning, certain questions still need to be answered
regarding the filling of vacancies. One nagging question is, "Should the existing vacancy be filled
at all?" There are cases when it is better to leave a position vacant and use resources for other
needs. Another possible question is, "What are the fundamental job skills that have been
simplified due to technological advancements? Is the vacancy an entry-level position?"
2. Position announcement/Job posting

Once the job vacancies are identified, the next step is to choose between external and internal
recruitment. In terms of percentages, the right combination of external and internal hiring
always raises an issue.
Job vacancies should be posted on company bulletin boards for a period of two weeks. This
should take place whether the company decides to either promote employees or get applicants
from external sources. This policy constitutes fair treatment of all employees since the job
postings allow those who want to apply for vacant positions to apply, thus giving them the
chance to offer what they have in terms of skills and experience.
3. Recruitment strategies
There are various techniques on how to recruit applicants. There are two sources of
recruitment: internal and external.
Table 4 ~ Sources of Applicants

Internal Hiring
Promotion transfer
External Hiring
Newspaper advertisement
Referrals
Internet
Job fairs
Manpower agency
Campus recruitment
Executive search
Project basis
Walk-ins
Internal hiring usually, involves and favors promotion. In some cases, an employee may want to
be transferred to another department of the same level (e.g.., secretary for finance and
secretary for marketing). When employees are promoted, they are given the opportunity to
enhance their skills, especially in leadership and decision-making. The promotion percentage of
internal and external hiring is something that poses a lot of issues, can a company make a 50-50
decision such as 50% promotion for internal hiring and 50% external hiring?
At this juncture, there are two sources of applicants: internal hiring (promotion) and external
hiring. The table below shows their advantages and disadvantages.
Table 5 - Comparison of the Two Sources of Applicants
Internal Hiring (Promotion from Within)

External Hiring
Advantages

Employees are motivated to work harder.
Employees are already familiar with the company's system or culture.
Companies incur less costs in terms pf recruitment expenses.
Salary distortion is avoided since employees who are promoted get pay increases based on the
company’s salary scale.
External Hiring
New employees bring in new ideas to the company.
The company has the opportunity to select the best candidates.
The company can provide jobs more people.
The company can maximize its recruitment efforts and improve its roster of employees by
hiring competent and high-caliber people.

External Hiring
Disadvantages

It paves the way for creative stagnation in the company. If no new employees enter the
workforce, no fresh ideas come in.
Employees become too familiar with each other and this may promote internal friction that can
upset the harmonious relationship among them.
Employees who are not promoted may feel demotivated and lose interest or enthusiasm in
their jobs.
External Hiring
The company incurs more costs especially in training new employees and executing massive
recruitment efforts.
It make take time before the best candidates for the positions are chosen especially those that
are critical of the company's achievement of objectives.
New employees may also take time to absorb the culture of the company Anything that does
not fit into their own values may spark friction or trigger resignation.
The following are the external sources of applicants:

a. Newspaper advertisement
Newspapers used to be the most popular medium for recruiting applicants, Usually, companies
advertise on Sundays as more people read the newspapers on that day. Newspaper
advertisements vary in size and usually companies prefer to advertise in broadsheets rather
than tabloids. The size of the advertisement is measured in columns and each column has a
corresponding fee.
This technique is fairly easy to do. After preparing a laid out text containing the job vacancies,
the HR can simply contact a local newspaper and specify a particular date when it wants the ad
to appear.
The downside to the newspaper ad is that it is limited in terms of exposure. HR pays on a per
day basis and the likelihood of people reading the newspaper has gone down because of the
growing popularity of the Internet as a medium for job hunting.
b. Internet
Job websites and company web pages are now the most popular source of applicants. Job
websites offer companies a cheaper package and carry the advertisements for a month. As
more and more people gain access to the Internet. more and more companies advertise in this
medium. Job aspirants upload their resumes on job websites based on the positions and
qualifications stated therein. On the other hand, job applicants visit company websites. This is
very common for the more popular companies. These firms have unquestionable integrity and
have been in the industry for many years. Thus, job seekers flock to their websites for possible
job opportunities.
Using the Internet for posting job vacancies gives maximum exposure both for the applicants
and the organization. Usually, job vacancies are posted for a month. Internet posting is also less
costly than newspaper advertisement posting.
However, the organization using the Internet to get applicants may take a long time before it
hires a qualified candidate. The vacancy that is posted longer online attracts many applicants
who need to be screened and processed thoroughly.
c. Manpower Agency
Companies which need temporary workers use the service of a manpower agency. Temporary
workers are hired to relieve employees (e.g.., employees who gave birth, who are sick, etc.).
Usually, temporary workers or contractual workers have employment periods of less than six
months. Contractual employees have no employee-employer relationships because they are
not hired directly but are under manpower agencies. They are paid by their manpower agencies
and companies pay the latter for supplying temporary manpower requirements.
Contracting a manpower agency is advantageous. The HR department of a company can devote

time to more important tasks. As mentioned, HR can there leave is all no the employer-
employee responsibilities to relationship so the the agency.
However, it is also disadvantageous. The HR must invest more time to establish a good trust-
based relationship with a manpower agency which can really attend to the needs of a
workforce.
d. Executive Search
Executive search firms or headhunters are employed by companies to look for applicants for
managerial and executive positions. Ideally, executive search firms are paid a certain
percentage, say 21%, as a professional fee, based on the annual gross compensation per
position. Thus, if the annual gross salary of a manager is P600,000 including bonuses, the search
firm gets 21% of P600,000 minus the corresponding taxes.
Headhunters usually have a resume bank of professionals. These professionals who are usually
executive officers submit their resumes to executive search firms for various reasons. First,
some are in search of greener pastures.
LESSON 3
Training and Development
The three M’s of training and development are maintenance, motivation, and measurement.
With body of new knowledge, competitive advantages, total quality management, and good
governance, companies saw the need to train and develop employees to level up and keep
abreast of these new trends. In addition, organizational growth hindered by the lack of
knowledge and training of employees prompted companies to invest in developing and
enhancing the skills of their human
Training is defined as a process or method of providing programs that may modify, change,
increase, or improve the level of performance of employees. According to Noe(2010), training is
a planned effort by a company to enhance and facilitate the learning of job related
competencies. These competencies include knowledge, skills, or behavior that is critical in
performing a job successfully
Development is a method of allowing employees to grow by giving them opportunities take on

greater or bigger responsibilities in preparation for more challenging tasks in the future.
Training and development refers to the official and ongoing educational activities within an
organization designed to enhance the fulfillment and performance of employees
(www.businessdutionary.com).
Many companies have realized the importance of Training in gaining a competitive advantage
and attaining. Organizational objectives. High-leverage training an effective instructional design
process to ensure that Training is linked to the fulfillment of company goals.
It also serves as a benchmark for the training programs of other companies. Continuous
learning provides employees with the chance to study the whole system that includes the
interrelationships among jobs, their work units, and the company. Through continuous learning
they are expected to acquire new skills and knowledge which they can apply on they the job.
(Noe, expected 2010).
The training cycle following is a systematic diagram illustrates approach developed by Roger
Buckley and Jim Caple. The following diagram illustrates this cycle.
Identifying training needs

Preparation
Training delivery
Applying learning
Evaluation
Figure 6.- Training Cycle

Source: A Basic Model of a Systematic Approach to Training by Roger Buckley and Jim Caple in
The Theory and Practice of Training (1995)
1. Identifying Training Needs
Buckley and Caple (1995) identified two ways of determining if there is a training need.
a. Reactive (Present) approach

There are six stages in identifying whether training is the best means to overcome a current
shortfall in performance or not:
 Define the problem and focus on past performance by studying quality standards,
productivity levels, customer complaints, and accident rates.
 Identify who is responsible for solving the problem.
 Define the method to be used in solving the problem.
 Analyze the problem.
 Identify the probable solution to the problem.
 Prepare a report as a form of feedback.
b. Proactive (Future) approach

To determine if future performance is linked to the organization’s objectives, the focus should
be placed on the following:
 Corporate strategy. Training is an important aspect of the company’s long-term
strategy.
 Manpower and succession planning. The implementation of training can somewhat
affect corporate strategy.
 New technology, products, or services. These can usher in the need for training and
development. New laws. Legislation can necessitate new training and development
programs in the organization.
 Ongoing personnel procedures. Surveys and reviews can create new training and
development needs.
The two approaches can be used in three different levels: company, team and individual.
2. Preparation
Once the training needs are identified, the training delivery, schedule, materials, manner of
presentation, venue, budget, food, accommodations, and the means of informing the target
audience should be prepared.
3. Training delivery
It is essential to consider the venue or location and the equipment to be used. The training
itself should be led by competent and experienced trainers or facilitators. In this case, training
should be regarded as a rewarding and valuable experience for the participants. The facilitators
should deliver their lectures in an appropriate communication style and language.
4. Applying learning
The trainees should be encouraged to practice what they have learned to appreciate the new
insights they have gained from training. They should be encouraged to get out of their comfort
zones and accept mistakes as part of the learning process.
5. Evaluation
It is important to find out the extent of the learning gained from the training program. There
are easy quantifiable measures of training success such as increased sales, higher production
volume, etc. The qualitative measures include attitude modifications, satisfaction levels, etc.
MAINTENANCE
The first M in the training and development function is maintenance. Maintenance means that
the company invests in its employees through training and development to enhance loyalty to
the company. It also means that the firm tries to maintain or enhance the employees’ good
performance.
There are various training programs a company can provide. The first is the new employee
orientation program. This program aims to provide new employees with pertinent information
about the company, specifically the following: the company’s prevailing culture;
products/services; work hours; break times; key personnel and members of top management;
the organizational chart; general policies like dress code, grace periods, major company events,
immediate supervisors, benefits, etc. More importantly, the company vision, mission,
philosophy, and values are reiterated to new employees, even though they have been
discussed already during the preliminary interviews.
It Is also best to introduce new employees to people they will work closely with such as those
who are in the department where they will be assigned to. New employees should not be
isolated, but immediately welcomed on their first day.
As mentioned earlier, training tries to improve or enhance the employees’ skills. The following
diagram breaks down the training process.
Training Needs Assessment

Formulation of Training Objectives
Designing of Training Programs
Determination of Appropriate Training Technique
Validation of Training Technique
Implemention of Training Program
Feedback
Figure 7- Training Process
1. Training needs assessment

This calls for the identification of present organizational needs as well as the current needs of
jobholders. Conducting a needs assessment is vital to the success of a training program (Brown,
2002). It is very risky for an organization to conduct a training program without a needs
assessment because some training sessions may over-train employees, miss some areas, or
yield unsatisfactory results.
Brown (2002) provided four main steps in conducting a needs assessment prior to the actual
designing of a training program.
a. Identify specific problem areas in the organization

For example, before team-building is done to improve relationships in an organization, the HR
should identify first whether team-building will really solve a current company issue or not. If
employees tend to be reserved or aloof with one another, is team-building or communication
the appropriate solution to the primary concern? The HR should first identify the pressing issue
rather than merely accommodate a single idea or suggestion.
b. Obtain management support

To obtain management approval and support for a training program, the projected outcomes of
a training program should be seen as relevant to the company’s long-term objectives. It means
that, for example, the productivity of the workforce has greatly improved after the training or
the employees became motivated and this resulted in higher outputs.
c. Develop data for evaluation
Training needs assessment tests the effectiveness of a training program prior to its
implementation.
d. Determine the costs and benefits of training

Prior to the conducting of the training program, training needs assessment can determine the
costs and the benefits of the program. The HR can also justify the costs and benefits gained by
the organization as a whole. Training can be justified as a way of increasing productivity which,
in turn, leads to higher profits.
The types of training needs analysis are the following:
a. Organizational analysis
It examines which specific department or area needs training. Examples are the installation of
new equipment or the implementation of a new procedure. When new equipment is bought
and installed, the employees who will use the equipment should be trained to operate it. A new
procedure can likewise affect a certain department and employees should be trained to
observe and make it operational. The composition of the workforce in a particular department
is also considered.
b. Task analysis
Training is also based on the kind of task employees perform. For example, before training sales
personnel, the HR should consider the kind of task performed, the skills required, and the
working environment where these tasks are performed.
c. Individual analysis
Training can also be based on the employee’s individual performance. If an employee has
certain deficiencies based on his/her performance evaluation, the HR and the employer's
immediate supervisor can recommend a training program that will help the employee meet a
certain performance standard.
According to Noe (2010) and Brown (2002), there are four steps in conducting a training needs
analysis:
a. Gather data on the training needs of employees

There are several methods of gathering data and the selection of a certain method depends on
the type of analysis to be done. The following are the methods of gathering needs data:
 Surveys or questionnaires. The HR can use the survey method to gather data.
Questionnaires are prepared and distributed to the employees. They are easy to
disseminate and reach a large number of people. This is especially true for large
organizations. Since the identities of survey respondents are kept confidential,
employees can freely answer the questions without feeling insecure and afraid even
though the survey tackles their weaknesses or deficiencies. The survey questionnaire is
really an economical and easy method to gather and analyze data
However, there is little room to get a free response. And it may take some time to
develop a good survey questionnaire. Also, a survey can only generate limited data since
there are certain pieces of information or ideas which cannot be fully expressed using
the method.
 Interviews. The interview format provides a leeway to be casual or formal. There is a

provision to dig deeper into the real catises or needs which cannot be fully revealed by a
survey or questionnaire. Also, the data gathered in an interview has depth. During the
interview, spontaneity is achieved because feedback in given right away and
clarifications are done more openly. However, an interview can really be time
consuming and analyzing data is difficult.
 Performance appraisals. These evaluations should be done regularly to be more

consistent and updated in gathering data. The strengths and weaknesses of employees
are recorded. Deficiencies are also identified based on actual performance However, it is
difficult and quite tedious to develop and implement a very good performance
evaluation. There are also biases that accompany performance appraisals through the
managers who conduct them Usually, performance appraisals are limited only to non-
unionized employees since union employees are under collective bargaining
agreements.
 Observations. The use of observations yields both Qualitative and quantitative data.
This method is not Disruptive of the normal world flow of employees under observation.
The data gathered is also realistic since Actual performance is being observed. Again,
however, it is time-consuming for the observer since the task can only be done reliably
while the employees are at Work. Employees may not also like being observed while
they are working.
 Tests. Testing can be done in the office or taken home by employees. Usually, tests are
used to assess the employee's comprehension skills. A test is very easy to quantify and
interpret. It is also helpful in determining deficiencies related to knowledge and skills.
However, there may be some inconsistencies especially when the test is brought home.
Since this is a test, the knowledge and skills being assessed may not be related or
applicable to the job.
 Assessment centers. Assessment is used in the area of management development

wherein employees are given exercises to find out their strengths which should be
developed. It can easily identify people who have the potential for further
advancement, thus reducing the bias in selecting people for promotion. Nonetheless, it
is expensive to do and time-consuming as well. Also, passing the exercises is the only
gauge and there are no criteria to follow in determining people with high potential.
 Focus group discussions. It is a common method of gathering data that allows the free
flow of various ideas and helps employees listen to contrasting viewpoints In the
process, employees become better analyzers, problem-solvers, and decision-makers.
However, because of the varied viewpoints, it is difficult to quantify and interpret the
results. It is also time consuming for the employees and discussion group leaders.
 Document reviews. Training needs can be identified by perusing documents such as

employer records, accident reports, policies, organizational charts, memos, etc.
Reviewing these documents is easy, gathering data is done objectively because evidence
for pertinent information is documented. However, documents only reflect past, not
current, inputs. The documents do not indicate causes the problems that need to be
solved.
 Advisory committees. These are groups of people why are in a position to provide
reliable information regarding the training needs of employees. One such group is also
easy to organize. It also permits interaction of the committee members, thus
strengthening and opening communication lines among them. Sometimes, a member of
an advisory committee who comes from a particular group of department may not be
the right person to provide Information about the group that he/she represents.
b. Determine what needs can be met by training and development

After gathering data related to training needs, the HR is tasked to identify what needs can be
met by conducting training and development sessions. There are certain issues or needs such as
salary and benefit issues which are not addressed in training, but should be brought to the
attention of top management.
c. Propose solutions
The HR should determine if training is the best solution because there are instances when what
is really needed is not training but mere polishing or enhancing of the employee's skill. For
example, an encoder may just need the aid of a software manual to fully utilize his/her skills.
d. Develop a training proposal

If a lack or inadequacy is identified and the need to conduct a training program is justified, the
HR must present A training proposal. This includes the expected results, the people to be
trained, and the possible consequences If the Training is not conducted.
2. Formulation of training objectives
Once the needs of the employees are identified, the next step is 10 formulate the main
objectives of the proposed training program. These goals should be clear, achievable, and must
address the needs of the organization and the employees.
In formulating training objectives, it is important to understand the role of the trainers and
trainees. The trainer’s role is expressed in the form of “aims” whereas the trainee’s role is
expressed in the form of “objectives. To formulate the trainer’s aims, he/she should answer
two questions: “What am I going to teach?” and “Why am I teaching it? Learning objectives are
stated according to the desired behavioral changes among the learners. There are three types
of learning objectives: knowledge, attitude, and skills objectives (www.
Learzcu3.gov.in/louk/technical/2.pdf).
a. Knowledge objectives
These usually include the acquisition of new information Learning is easily quantified. For
example, by the end of the session, participants should be able to list the steps I writing
effective memos.
b. Attitude objectives
These learning objectives include a change of feelings or beliefs. Thus, the training is regarded
as the most difficult among the three types because the participants should be convinced that
the change of attitude will benefit them in some way. For instance, by the end of the program,
the participants should recognize their worth as individuals.
c. Skills objectives
These objectives include the ability of participants to do something new or acquire new ways or
methods of doing a task. Learning is gauged according to the changes in the way they do a task.
By the end of the session, for example, participants should be able to deliver a presentation in
public using a slide show. (This situation assumes that participants do not know how to make a
presentation using visual aids in the past.)
According to Mager (1997), a learning objective has three parts: behavior, condition, and
criteria. Below are sample descriptions and illustrative words or phrases based on Bloom’s
Taxonomy of Learning that are helpful in formulating training objectives (www.nwlink.com/-
donclark/hrd/ bloom.html).
a. Behavior: What will the trainee’s demonstration of learning be? The performance must be
observable.
 Knowledge learning: list, describe, report, debate, hold, Approach
 Attitude learning role-play, discuss, critique
 Skills learning: demonstrate, lead, perform
b. Condition: Where, when, and how will it be done? Are there special conditions present while
on the job?
 Knowledge learning: Without the aid of notes, without Coaching
 Attitude learning Without talking or moving your hand
 Skills learning: Given the situation, without the
c. Criteria: Level and quality of performance that is acceptable. Knowledge learning.
 As judged by your supervisor, as judged by your peers
 Attitude learning: To the opinion of your leaders and peers
 Skills learning: To the satisfaction of your supervisor, No more than three errors
Every session of the training program should have learning objectives to the participants can
check whether the objectives are achieved or not.
3. Designing of Training Programs
After formulating the objectives, the training program is designed In accordance to budgetary
considerations. Other things to consider are the following the specific number of employees to
be trained, the duration of the training program, accommodations (if any), and venues and food
costs. There are six principles in designing a training program
a. Structure
This includes the appropriate connection of topics, Specific goals, and activities, and how they
interrelate with One another in the achievement of learning objectives
b. Flexibility
The training program should attend to anticipated needs and adapt to varying circumstances.
c. Relevance
The program should focus on the needs of the trainees
d. Evaluation and feedback

The program should validate learning.
e. Transferability
Knowledge, skills, and attitude changes should be ingrained in the participants after the
training.
f. Cost-effectiveness
The program should provide the greatest benefit at the least cost.
The following are the steps in designing a training program:
Title
Rationale of the Training
Obejectives of the Training
Course Outline
Learning Methodology
Time Frame
Duration And Venue
Evaluation Method
Resource Speakers/Persons
Training Cost
Figure 8- Outline of a Training Design
a. Provide an appropriate title for the program and rational the reason for conducting the
program.
b. State the program objectives
c. Determine the specific contents of the program.
d. Select the learning methodology and indicate the time frame
e. Determine the duration and venue.
F. Identify standards and evaluation measures
G. Select the resource speakers
h. Calculate and prepare the budget.
ProMinds Consulting demonstrates a sample training program designed for team leaders
(www.promindsglobal.com):
Module 1
UNDERSTANDING THE MISSION
Clarification of the mission
Clarification of the success indicators
Clarification of the activities
Module 2
STRESS MANAGEMENT ACTIVITIES
Stress prevention
Avoidance of burnout
Module 3
LEADERSHIP AND EMPOWERMENT
Clarification of roles
Delegation and authority
Limitations of power and authority
Figure 9- Sample Training Program Content for Team Leaders

Adapted from www.promindsglobal.com
4. Determination of appropriate training techniques

While the training program is being designed, different training techniques should be studied
and considered if they are appropriate. The training program should fulfill the training
objectives.
MOTIVATION
The second M is motivation. Motivation in the training and development function discusses the
different techniques in training and developing employees to boost their morale and encourage
them to grow and to perform better.
Before discussing the various techniques or methods used in training and development, it is
very important that the trainers, instructors, and speakers are chosen carefully.
Usually, the success of training programs rests on the caliber of the trainers selected.
Therefore, the selected trainers should effectively communicate the content of the program.
Trainers should not only be articulate but also tactful, flexible, and innovative. The HR
department may have in house trainers or may decide to hire consultants or third parties
depending on the program objectives.
There are various training techniques which are subdivided into cognitive and behavioral
methods. The selection of a training method depends on the background and skills of the
trainees Trainers also need to understand the advantages and disadvantages of each method.
(www.traininganddeveloment. Naukrihub.com/methods-of-training).
COGNITIVE METHODS
Cognitive methods pertain to the rules on how to carry out, demonstrate, or relate concepts.
The methods aim to make changes in the participants’ attitude and for them to gain additional
knowledge.
1. Lecture
This is one of the most popular and oldest methods that help trainees understand a particular
concept and trainers to influence behavior and attitude. Basically, training is accompanied by
lectures, no matter which method is used as the main training tool. Straight lecture I a sub-type
of the lecture method in which the trainer discusses the topic to the participants without
interacting with them. Instructional materials can also come in the form of textbooks, notes,
etc. The printed text naturally offers no visual imagery, or human gestures, speech, ar body
language. Printed material can also be studied at the trainee’s own pace. The lecture method is
not costly and can be done with a fairly large number of people in one session. Trainees build
their knowledge based on what they hear from the trainer. However, it requires a long period
of inactivity among the trainers because they are expected only to listen. There is also no
chance to clarity any misunderstanding Knowledge-building, moreover, tends to rely on the
ability of the trainees to grasp information and since not all of the participants have the same
capacity to understand and comprehend what is being discussed, it la not known if all of the
trainees have learned what they are supposed to learn. It also tends to bore participants and
thus limit their attention span.
2. Demonstration
This method is good for showing how something works or how to do a certain task. Usually, a
demonstration is accompanied by a lecture to make it more effective. The advantage of the
demonstration method is that there is a visual display of how something works as well as a
description, so participants can focus more on what they see and hear. However, this method is
expensive. The materials and equipment needed for the demonstration can be costly. The
trainer also charges more than he/she would normally charge for a plain lecture because
he/she should have a specific skill or expertise on what he/she is demonstrating to convey or
elucidate well how it works.
3. Discussion
This method does not stick only to the straight lecture but it also supported by interaction
among the trainees and between the trainer and the trainees. This method is useful because a
higher level of knowledge is achieved since interaction takes place between the participants
and the trainer. Two-way communication is also enhanced. There is also room for clarification
as well as verbal and non-verbal feedback. The trainer will have an idea if what he/she has
discussed is understood well by the participants. Questioning helps participants in recalling
what has been tackled. Nevertheless, not All participants are open to discussion. There are
trainees who do not express themselves well and are thus unable to participate in the
discussion.
4. Computer-based training
Many companies now use computer-based training instead of classroom-based training. The
Internet has become a venue for delivering training On the one hand, computer-based training
is advantageous because face-to-face interaction is not required. It also reduces costs and
trainees’ learning time. The trainees can master the training module through repetition and by
working on the material at their own pace. They are not pressed for time and are not pressured
at forced to attend training as scheduled. They also have easy access to training and some
degree of own privacy and convenience. The disadvantage, however, is that feedback is not
guaranteed since participants may not go through a particular material all at the same time.
Learning is more difficult to quantify and the achievement of training objectives is not readily
known.
5.Programmed instruction
It is a form of computer based training that utilizes graphics, multimedia, and text stored in
memory. The program is in a company system and participants can access the program through
the network The participants go through the content of the material, answer questions, and go
to the next level if they get correct answers. Again, the advantage is that the participants can
learn at their own pace. It also depends on the participants’ comprehension. Moreover, the
company can also use books, videos, and other platforms to save costs. The trainees also
acquire a substantial amount of information and are then tested based on their
comprehension. However, feedback is not known at once since the participants go through the
material at their own speed.
6. Virtual reality
This method allows the participants to experience a 3-D environment. It provides the
participants experience in certain situations that actually happen on the job. It is also flexible
and participants need not go out of the company for training. There are savings from food,
lodging, and other accommodation costs of the participants. Virtual reality tends to be time-
consuming though and requires excellent infrastructure. Aside from the infrastructure, the
company will also need the following headset for audio and visual information, gloves for tactile
Information, treadmill for movement, and other sensory devices so that trainers can keep track
of the participants’ responses in the virtual workplace. Therefore, it is really expensive.
7. Distance training
Corporate training is gradually changing. The HR makes use of the power of technology to train
employees. If their technicians need to immediately repair a particular machine that broke
down for the first time, what they will do is just find out the brand and the manufacturer, make
a phone call, and download all the important data and repair instructions. They can then
acquire the know-how in troubleshooting that particular machine. Distance training, therefore,
is not expensive. However, it may take time to access or download important information from
the Internet. Thus, it creates pressure especially for troubleshooting purposes.
8. Brainstorming
It is a group activity in which participants generate possible solutions to a problem. The upside
of brainstorming is that it stimulates and uses the participants’ experiences and ideas to solve a
problem. The disadvantage is that it is time-consuming and participants may not cooperate.
Some also tend to be passive and not contribute a lot of ideas
9. Worksheet
This method is used to perform quantitative exercises. A participant can relate their general
learning to the specific areas of their work However, it is time-consuming and difficult to
prepare.
BEHAVIORAL METHODS
These methods provide practical training for participants and are used to develop their skills.
1. Games and Simulations
These are commonly used to simulate events or processes that take place on the job, Games
refer to training exercises where participants compete with one another according to some
clearly defined set of rules Simulations refer to computer games that imitate how a particular
event might happen in a real-life situation
a. Business games
They simulate the whole organization and allow participants to experience what it would be like
in a particular situation and give them the opportunity to decide which action will be favorable
to the organization. The trainer gives them feedback on the impact of their decision. Business
games develop leadership skills and promote management skills. They help solve complex
problems. However, they focus on the whole organization and not on the specific functions of
each position.
b. Case study
It simulates a particular situation and trainees decide on a particular solution to an
organizational problem highlighted in the case. This approach is recommended. because
participants are trained how to pinpoint a particular problem in a situation. It also provides
them with relevant facts that will help them in solving the problem and allows them to come up
with alternative courses of action that may solve a particular problem. It enhances their
interpersonal and communication skills during the discussion with the other participants. The
case study method also meets knowledge, skills, and attitudes objectives. The downside is that
it is time-consuming and participants may not agree or determine the same problem. This may
spark conflicts among the participants who may have different perspectives regarding the
problem in the case under study.
c. Equipment simulators
These are mechanical devices that simulate the physical surroundings of the participants’
workplace. The physical surroundings, relationships with colleagues, time pressures, and other
demands in the workplace are simulated so that trainees may closely match what they
experience in the workplace. This type of training is ideal for taxi drivers, telephone operators,
ship navigators, air traffic controllers. Maintenance workers, product development engineers,
airline pilots, and military officers. Trainees can experience a real-life situation that happens in
the workplace without interrupting normal work hours. Some actual situations, however, may
not be tackled during the simulation exercise
d. Behavior modeling
This method uses a videotape to demonstrate a particular behavior. The trainees watch the
tape and then practice what they saw through role plays or other simulation techniques. It is
preferable for sales, safety, and interview trainings. It is not expensive and time-consuming. A
particular skill is t defined well in videotapes. Participants can have different interpretations of
what they have watched, however.
e. In basket technique
In this method, memos such as complaints from a customer, a request for additional orders, an
application letter for vacation leave from a subordinate, a list of charitable programs, an e-mail
from the president about a request to relieve him because he has a speaking engagement, etc.
are placed in a container or basket and the managers pick a memo and try to resolve it. Since
the in-basket technique is usually used for managers, they are evaluated on the basis of how
they would prioritize and analyze the contents of each memo and the quality of their decision
and responses within a certain time limit. This technique is helpful because it encourages
decision-making and enhances interpersonal skills It also develops analytical thinking. But care
must be observed because the documents used may not be challenging as to warrant the
application of decision making and analytical thinking skills.
f. Role-playing
This method uses an actual work situation and participants are given a role to play and act out.
Some examples of work situations are employees in conflict, misinterpretation of a memo, and
so on. Role-playing helps in managing conflicts and developing interpersonal and
communication skills. The disadvantage is that not many people are comfortable with mile-
playing. Some participants may either exaggerate or underplay a particular role.
2. Management development programs
The manager’s role in the workplace has become more crucial in today’s competitive
environment. Companies are presently tasked with providing management development
programs to enhance managers’ knowledge, skills, and attitude (KSA). Some management
development techniques are as follows:
a. Goal setting
The development of individuals can be enhanced depending on how they set their goals. This
technique helps them set objectives or goals that are measurable, clear, and achievable. Goal-
setting is important to employees because it helps in establishing concrete plans and motivates
them to reach whatever goals they have set for themselves. Goal setting, however, is limited to
formulating goals and does not explain how to achieve or actualize them. There is no way to
harmonize the goals employers have set to help in achieving company objectives and the
personal goals they have set for themselves.
b. Team-building
It is a development process that helps employees work well in groups, enhances their social
skills, and provides the opportunity to be sensitive to the feelings of others Team-building
activities help the organization in achieving greater efficiency and productivity in the workplace
because employees get to know each other better. Nonetheless. Managers may become too
comfortable with one another and this familiarity may affect their decisions in the future.
c. Total quality management (TQM)

It is a company-wide development technique that require everyone in the organization to
continuously improve their operations and strive to maintain quality of work in all departments.
However, managers are given more access because of the sensitivity of their positions. TQM
instructs managers on how to be conscious about quality and how to enhance productivity as
well. However, TQM is expensive.
d. Executive coaching
This method is usually used by the company’s chief executive officer (CEO) and his/her
consultant. This practice aims to further develop the skills of an executive in his/her job as a key
officer. Coaching is done at the convenience of the executive. It involves one-on-one
interaction. It can also be done through the e-mail or phone. It provides an opportunity to get
feedback from an expert in the field. However, it is expensive to hire a consultant for coaching
purposes.
e. Executive mentoring
This often happens between a junior executive who may be new in the company and a senior
executive who already has extensive experience in his/her field of specialization. Executive
mentoring helps junior executives grow professionally and prepares them for higher
management posts in the future. The advantage of mentoring is that it involves one-on-one
interaction and helps in attitude development. It identifies strengths and weaknesses of the
mentee. The disadvantage is that both the mentor and mentee are in the organization. There
are individual pressures on the job. Mentoring may not work well for executives who are always
pressed for time and deeply involved in demanding tasks.
f. Job rotation
This method gives executives the opportunity to experience ot her tasks that require
managerial skills. Job rotation is usually practical in large universities where a department head
or chairperson of a particular discipline may be assigned as the registrar or head of research.
Managers are given the opportunity to assume different positions and tasks and have a better
perspective of these various jobs in the process. Nevertheless, this practice provides a feeling of
discomfort and insecurity for managers or executives who are rotated after becoming familiar
with a certain job.
3. On-the-job training
On-the-job training (O.IT) is widely used in small organizations. The task of training employees
are given to managers or supervisors. On-the-job training is frequently undertaken in the
workplace, hence it is done in real situation. There is no work interruption. However, if training
is not planned, there is no formal procedure or content.
It is still best to have a formal on-the-job training program wherein the method, processes, and
techniques are well discussed before during, and after the training. The trainee must also have
continue, monitoring and feedback On-the-job training also employs these techniques:
a. Coaching
This practice is observed between a supervisor and rank-and-file employee. Coaching is done on
the job.
b. Mentoring
Through mentoring, the superior provides guidance and understanding to a subordinate by
teaching him/her how to carry out his/her role in the achievement of company objectives. The
superior prepares a subordinate for a higher position in the future.
c. Job rotation
Employees can also assume other jobs within the same department to give themselves the
chance to experience other tasks and to be promoted to a higher position later on.
4. Validation of the training program
A training program should be validated before its actual implementation. It is tested using
employees who will not be the probable participants of the training program. This is usually a
pilot run or a pilot test. Revisions, if any are required, are done after the Implementation of the
program.
5. Implementation of the training program
If the program is workable, the training program is scheduled for actual implementation. Some
companies have felt the need to provide the best possible training programs and have built
their own training academy or training center to support the learning, development, and
growth of their employees.
While it is appropriate to select the best training techniques available, it is also equally
important to have a good trainer who will be responsible for the actual implementation of a
training program The characteristics of a good trainer are the following :
a. Lead by example with high integrity and credibility

A trainer should be a role model with utmost integrity and a high standard in every aspect of
his/her life. He/she should be credible.
b. Know the would-be participants

A trainer should do a background check of the participants Knowing their background can help
during training. He/she should know their capabilities and knowledge level so that he/she can
prepare on how to deal with them. These insights can help the trainer in conducting the
training session properly.
c. Exercise humility
Naturally the trainer is more knowledgeable than the participants, but he/she should be
modest about it. He/ She should not look and feel superior as a trainer and munt consider the
efforts of the participants.
d. Use humor sparingly
There is nothing like an enjoyable training session for the participants. A trainer may inject a
little humor from time to time to prevent them from getting bored.
e. Show enthusiasm
Enthusiasm shows and it is infectious. When a trainer sets a good mood, the trainees will also
feel excited to listen and learn.
f. Get the support of top management

Management should be open to good training programs. A trainer should always ensure that
there are key players who can support and recognize the importance of training and how it can
help in achieving overall company goals.
There are two approaches in the implementation of training program. The first one is focused
on the trainer who controls the contents of the program, and the other one is centered on the
participants or learners while the trainer is just acting as facilitator and resource person. The
latter is the better approach since it assumes that the participants are willing to learn if they are
given thematerials in an environment that is conducive to learning.
6. Feedback
After the training, the program is evaluated in two ways. First, the participants of the training
evaluate the program itself based on all its aspects such as venue, food, the speakers and/or
trainers, Improvement and their immediate audiovisual respective superiors in the work aids.
Work of areas. The performance most participants These important superiors of those after
feedback monitor who the participated latter comes any go change from back in the program.
MEASUREMENT
The last M in the training and development function is measurement. Evaluating the training
and development programs requires a cost-benefit analysis. Measurement here is the end
result of the training and development programs.
The most widely used training evaluation model is Donald Kirkpatrick’s tour levels of evaluation
model. A training program is evaluated according to the following levels
(www.mindtools.com/pages/article/kirkpatrick.htm):
1. Reaction
This level indicates how the participants felt about the training It is very easy to obtain. Usually
after training, the trainer provides an evaluation form asking the participants to comment on
food accommodation, venue, and the program itself. In some cases, the trainer is also
evaluated.
2. Learning
This level measures the increase in knowledge before and after the training. This is not readily
measured right away. Observations and interviews are common methods of evaluating
learning.
3. Behavior
It is the extent of learning applied right on the job. The assessment of any change in
performance is also done through observations and interviews.
4. Results
This level evaluates the effect of the participants’ performance after the training and how it
affects the whole organization and the society at large.
To ultimately measure either the training or development aspect of the program, the author of
this book has set a criteria for evaluation termed as the R’s:
1. Reactions
These include the actual reactions of the trainees on such factors as content, venue, food,
accommodation, visual aids, etc.
2. Results
These include the end results of the program in terms of job performance, productivity, and
efficiency.
3. Recall
This includes the participants’ recall of what has been learned and the actual application of
what is recalled. A program well-received, well-delivered, and effectively implemented will be
easily recalled by the participants.
4. Retrieval
Following recall is the immediate retrieval of information from memory recall and the eventual
application of retrieved learning.
The four R’s are essential for any change or modification of behavior on the part of the
employees, and thus, they confirm, that a training or development program is a success.
The return on investment (ROI) methodology on evaluating training programs emerged from
the work of Dr. Donald Kirkpatrick and Dr. Jack Phillips. This methodology has become the most
credible and the most widely; used training evaluation tool. Moreover, it provides the most
practical way of forecasting the potential return on investment of a proposed training program
(Phillips, 2002).
In its simplest form, ROI is the ratio of the net benefits of an investment compared toits total
costs. The formula is:
ROI= Total program benefits- Total program costs/ Total program costs x 100%
The Phillips Model measures training outcomes in five levels (Phillips,2003).
1. Reaction, satisfaction, and planned action

These factors measure the participants’ reaction to and satisfaction with the training program
and their plans for action.
2. Learning
It measures the skills and knowledge gained by the participants.
3. Application and implementation

These factors measure changes in the on-the-job application, behavior or attitude, and
implementation. They also measure how the participants are able to apply the new knowledge
and skills gained or attitude changes learned as they work.
4. Business impact
It measures the impact the training program has had based on the participants’ on-the-job
application. It can be evaluated through productivity, output levels, and the punctuality and
quality of the product or service.
5. Return on investment (ROI)
It compares the monetary value of the business outcomes with the cost of the training
program. Thus, it is the ultimate measure of a training program’s success.
Phillips pointed out that if a training impact program from Level is successful, it would result in
a chain of positive impact from Level 1 (Reaction, satisfaction, and planned action) until ROI. If
ROI is negative from the training investment, the HR should identify what has caused the
negative result. If, for example, it is negative in level 2 (Learning), it means the participants did
not learn.
The Phillips model evolved to identify from the earlier Kirkpatrick model. It made of concrete
metrics to identify the benefit of a particular training program.
Example of the ROI Methodology

The cost of training sales personnel is P120,000. The impact of training is an increase of
P200,000 in sales per year. To compute for ROI:
ROI= 200, 000 – 120, 000 / 120, 000 X 100%

= 66.67%
This means that for every peso spent on training, 0.67 is contributed to profit. Training program
can be deemed a success.
LESSON 4
PERFORMANCE MANAGEMENT AND EMPLOYEE MOVEMENT
The performance management system is what Pulakus (2004) calls the Achilles heel of HRM.
Not many companies in recent years have paid much attention to this particular human
resource function Although they have installed performance realuation methods, these were
poorly developed and caused diffinities for both managers and employees. The clamor for an
effective performance management system has become increasingly important due to
globalization, stiff competition, and other social and economic pressures (Williams, 2002).
Performance management is the process by which managers, supervisors, and executives

assess the performance of employees to ensure that it accords with the company's objectives.
Armstrong (2006) defines it as a systematic process for improving organizational performance
by developing the performance of individuals and teams" (p. 618). It is the best way of
managing and rewarding performance based on planned goals. Armstrong and Baron (2005)
describe it as a "strategic and integrated approach to delivering sustained success to
organizationa by improving the performance of the people who work in them and by
developing the capabilities of teams and individual contributors" ip 618).
Performance management in effective if it does the following:

1. Identify excellent performance
2. Use appropriate appraisal techniques
3. Provide feedback to employees regarding their Performance
4. Evaluate employees fairly
5. Minimize biases
6. Exercises fairness
PERFORMANCE APPRAISAL AND PERFORMANCE MANAGEMENT

Performance appraisal is often synonymous to performance management. Performance
appraisal is a formal annual assessment of employees by their immediate superiors. Periodic
performances reviews are done routinely by managers.
In contrast, performance management is a continuous and more comprehensive process of

managing people. It is not exclusive to evaluating employees annually or periodically. It is about
motivating guiding, and rewarding employees, thus helping them hone their potential and
improve organizational performance.
The performance management cycle below shows managing performance as a continuous

process.
Planning
Monitoring
Acting
Reviewing
Figure 10- Performance Management Cycle

Adapted from: Performance Management Cycle by Michael Armstrong, Performance
Management: Key Strategies and Practical Guidelines, 2006
1. Planning
This pertains to the setting of performance goals and expectation of groups departments or
units) and individuals (subordinates and superions). It ensures that all efforts work toward the
achievement of company objectives. All employees are involved in the planning proce so that
they will understand what the company wants to achieve also explains the importance of
managing effective performance and how such management is to be carried out.
Planning covers the following areas which should be defined clear and comprehensively as a
first step for a successful performance management system
a. Roles
The manager (immediate superior) and the employer should discuss key result areas and define
their respective roles. Thus discussion ensures that both possess the necessary behavioral
competencies and the core values that each of them should uphold.
b. Key result areas

The employee at this point should think of the most important tasks that he/she has been
assigned with and the kind of performance that is expected from him/her. He/She should also
find out how others have performed the same tasks before. This examination should be
discussed so that all the tasks (which may appear multiple or many) can be summarized or
grouped into key result areas.
c. Technical competencies
The employee should possess the essential knowledge and skills (eg, procedural, problem-
solving, planning, and communication) to be able to do his/her tasks well.
d. Behavioral competencies
The manager or the immediate supervisor should Discuss the behaviors/traits expected by the
organization. These traits include drive, teamwork, leadersnip, planning, Communicative skills,
etc.
e. Objectives
The employee and the immediate superior should agree on the performance objectives (eg,
sales representatives should aim to minimize customer complaints and always maintain a high
level of customer satisfaction). Objectives should be quantifiable and measurable in terms of
sales, income level, output, cost reduction, etc.
Importantly, the employee and the immediate superior should agree on and integrate the
performance objectives. Below is an example of an agreed-upon, integrated set of objectives.
Corporate
Provide a quality product that satisfies costumers, coupled with superior customer service and
support
Functional
Define the aspects of customer service in terms of value for money, quick, response, superior
quality product performance and customer satisfaction.
Team
Agree on performance standards set previously and ensure that they are congruent to
corporate and functional objectives.
Individual
Ensure that individual standards are in line with team objectives and make sure that skills and
competencies required are known and used.
Figure 11 – Agreed-upon Integrated Objectives

Adapted from: Two-way Process of Agreeing on Integrated Objectives by Michael Armstrong,
Performance Management: Key Strategies and Practical Guidelines, 2006
f. Core Values of the Organization

The core values of the organization include integrity, Loyalty, industry, and honesty.
2. Monitoring
Monitoring provides the mechanisms by which performance will be measured. It also entails
giving constant feedback to employees regarding their progress in achieving the goals of the
organization Undoubtedly. Planning is very important in the performance management cycle.
More importantly, the articulation of performance objectives sets the stage for a successful
performance management system. However, these objectives can only be achieved if there are
agreed upon and reliable performance measurements which can spell the difference between
performance standards and actual performance
Performance measures can be established in terms of output and outcome. What is

quantifiable is an output whereas what can be visible but cannot be measured in quantifiable
terms is called an outcome (Armstrong, 2006).
Output metrics include costs, income, sales, speed of recovery or Response, delivery time, etc
Outcome measures include completion of work, changes in behavior, judgment of customers,
attainment of a Standard level of service, etc.
In monitoring performance, a performance plan using the agreements made during the
planning stage is provided. A personal development plan is also accomplished so that the
immediate superior can support the employee’s improvement of knowledge and skills. This
may include coaching, mentoring, job enlargement, or job Enrichment activities.
This also includes the process details which show how and when a certain kind of performance
will be reviewed.
3. Reviewing
Performance is reviewed from time to time and compared with the performance standards,
goals, and expectations which were agreed upon during the planning stage. The act of
reviewing performance should be a continuous process. Managers should always allot time to
dialogue with their subordinates. During such sessions, the agreed upon objectives and
development plans should be reviewed to give room for revisions if any are needed.
Reviewing has the following objectives (Armstrong, 2006):
a. Planning
This is the opportunity to find out if there is a need to revise the performance agreement
between the employee and the immediate superior.
b. Motivation
This encourages the employee to grow or take control of his/her performance.
c. Learning and development

This is an opportunity to further develop the employee's knowledge and skills and to provide
him/her with learning activities that maximize his/her potential
d. Communication
-This promotes two-way communication between the superior and the subordinate. Roles and
performance expectations are clarified and a relationship between them is built on mutual trust
is developed.
4. Acting
This includes activities based on the performance review. It means giving an employee feedback
on his/her accomplishment of organizational goals. Feedback is based on evidence which
should be fair to the employee. It should describe what actually happened and should not be
based on the mere judgment of the superior. Thus, it is not at all subjective. The manager
should focus on the sapects of employee performance that can still be improved. If there is a
need for training-enhancing employee skills or acquiring new tank and responsibilities-specific
programs should be devised. Outstanding performances, on the other hand, are rewarded and
recognized.
The three R's of performance management and employee movement are rewards, retention,
and remuneration.
REWARDS
Rewards are tangible manifestations of a job well done or a good deed. They are included in the
scope of performance management because conducting performance appraisal involves
acknowledging the employees' contribution in the attainment of the firm's objectives.
The outstanding performance of employees benefit the organization. Employees who perform
outstandingly, as indicated in the performance appraisal, are rewarded by the organization in
different ways.
Under the performance management system, there are periodic performance assessments
conducted using various tools and techniques, either individually or by group.
Performance appraisal determines whether employees perform effectively and are on a par
with the company’s expectation. It concretizes and measures performance as an aspect of the
performance management system. Formal evaluation as opposed to the informal one is highly
preferred and recommended. An informal evaluation is done by mere observation. Over the
years, perinmance of job promotions to making of other employee related decisions which
dramatically affect long-term organizational performance (www.ihabaarieddine.com)
The following are the purposes of performance appraisal:
a. Needs assessment
The results of performance evaluation provide relevant information about the specific training
needs of employees.
b. Employee movement
The appraisal helps management decide who will be promoted aided by concrete evidence of
meritorious performance.
c. Basis for merit increase

In addition, it also justifies merit increases.
d. Legal concern
If there are issues triggered by certain actions like termination of employment, the appraisal
document serves as basis of such decision. Other questions about performance issues include
rewards provision, layoff, and transfer.
e. Development
A series of performance appraisals monitors the growth of employees. These periodic recurds
can assist the career pathing and development of personnel.
f. Channel of communication
This is a good source of enhancing discussions on performance issues between the employee
and the immediate supervisor. It becomes an avenue for ironing out differences and
articulating certain career concerns or questions on performance ratings.
g. Source of motivation
Performance evaluation is one of the best ways to keep employees motivated Every
performance appraisal period generates excitemen on the part of the employees. It is one way
of boosting their morale and encouraging them to make good impressions and give outstanding
work performance.
The following are the different performance appraisal techniques
1. Individual Evaluation Methods
a. Graphic Rating Scale
This is the most popular technique. Employees are rated using a set of traits or characteristics
such as punctuality quality of work, flexibility, cooperation, and the like. The table the next page
is an example.
Table 6- Graphic Rating Scale

Traits
Attitude towards work
Teamwork
Creativity
Flexibility
Honesty
Punctuality
This technique clearly defines the core traits needed for the job, It is very popular because it is
very easy to use and makes comparisons between employees possible. The traits it identifies,
however, are too general and raters may tend to underrate or overrate an employee. As a
result, it may not accurately describe an employee.
b. Forced Choice Technique
This is a technique that branched out from the graphic rating scale. The HR develops a set of
descriptive statements and the supervisors rate their subordinates based on how they behave
on the job. The HR prepares the following statements and a rater ranks an employee, for
example, using number 1 for the statement that best describes the employee and number 6 for
the statement that least characterizes the latter. There will be no ties when it comes to the
scores.
Here are some examples of discriptive statements:

_mingles well with co-employees
_undertands directions quickly
_manages time well
_resouceful
_innovative
_controls his or her emeotions
The HR department gathers and adds the points in cach category and an index to further
categorize the employees.
This method is inexpensive and fairly easy to use. However, just like the graphic rating scale, the
rater is forced to choose from a number of statements that may or may not describe an
employee. In this case, the rater can become subjective.
c. Critical Incident Technique

In this particular technique, the rater or the int supervisor keeps track of all the critical or
relevant behaviors the subordinates. A logbook is used to record these bebation whether good
or bad. For example, a technician has to be capab of immediately detecting a possible
mechanical failure that arine before it costs more than a million pesos’ worth of issues in
production output. The failure may be detected a day before machine's actual breakdown.
This technique is useful because it provides an actual picture of performance through the
handling of a critical incide thereby giving a clear, fair, concrete, and accurate evaluati However,
this particular technique becomes tedious for the supervisor because continuous observation
should be dour l each of his/her subordinates. Otherwise, it would be very unfair on the part of
the subordinates who may have displayed ide work behavior that has gone unnoticed and
unrecorded.
Supervisors should accurately track positive and negative work behaviors using the critical
incident technique. Otherwise, such acts become meaningless since they are out rightly ignored
or forgotten.
d. Checklists and Weighted Checklists

The HR provides a list of descriptive statements with corresponding weights. The rater checks
the statements which would likely describe the employee. Otherwise, he/she leaves it blank.
He/She can check as long as they apply to the traits of the employer concerned.
Descriptive Statements
_tactful in dealing with concers of fellow workers
_systematic in doing the job
_submits reports on yime
_shows leadership in group activities
_speaks clearly
_shows initiative in meaningful subjects
Weights
8.0
7.5
4.9
5.9
5.7
6.3
The items above show the weighted checklists. The supervisor adds the weights of the items
checked.
The checklists are simpler than the weighted checklists because there are no weights. The
supervisor just checks the statements that likely describe the employee. There are
corresponding scores based on the number of checks.
This technique is not time-consuming and, therefore, ideal for large organizations. However, a
checklist may not provide all the possible tasks of an employee. There is also a tendency for the
supervisor to merely check the statements without mulling over all the relevant factors. In such
cases, the evaluation becomes perfunctory.
e. Behaviorally Anchored Rating Scale (BARS)
Patricia C. Smith and Lorne M. Kendall developed the BARS (Smith and Kendall 1963 cited in
John M. Ivancevich (2009). There are about nine performance dimensions with anchor
statements of critical incidents in a scale. The ability of a sales representative to provide
accurate information to customers is
an example of a performance dimension.
This method is advantageous because it describes a particular aspect of a job in great detail. It
provides more objectivity than the previous techniques mentioned. The construction of BARS,
however, is too complicated. Thus, it is not a very popular evaluation technique because it is
time-consuming.
Figure 12- Behaviorally Anchored Rating Scale
f.
Essay Evaluation
In this technique, the rater discusses in narrative form all the levels of performance manifested
by his/her subordinates Advantageously, the rater can discuss what he/she feels is relevant to
an employee's performance without the use of statements to describe them. However, it is not
advisable if the rater has many direct reports. It is time-consuming and helpful only to
managers who have a flair for writing. One disadvantage of this technique is that there is no
consistent and specific criterion by which to gauge performance.
2. Multiple Person Evaluation Methods
a. Forced Distribution
The forced distribution technique allows a supervisor to group his/her subordinates at his/her
own discretion. For example, out of 20 personnel, 20% or 4 personnel will receive outstanding
ratings, 40% or 8 personnel will get above average, and so on. A problem occursif more than
20% of his/her subordinates get outstanding ratings and he/she will stick to just 4. If none
outstanding ratings, he/she will just stick to 4 as outstanding although they should only be
above average.
This technique is very easy to use, so it is widely However, it is controversial because employees
may not fit the groups identified by the manager. There may be a thin line between, say, 20%
and 40%.
b. Ranking
In this method, the supervisor rates all the employees from first to last. A manager can easily
make decisions such as who becomes employee of the month or who gets laid off, it alto
motivates employees to work better since they will know where they stand in comparison with
the others. If the supervisor has 16 employees, it may be difficult for him/her to rate them as to
who is first, second, third, and so on and so forth. This procedure is quite tedious since it
invohes placing employees in a particular rank or position
c. Paired Comparison Technique

The supervisor rates employees by pair. Suppose four employees will be evaluated: Employees
A, B, C, and D. The raters will be given six cards with the names of the employees in pair.
Figure 13- Paired Comparison Technique
The supervisor determines the most preferred employee based on his/her appearance in the
pairings. Final rankings reveal the most preferred to the least preferred employee. To cite (1)
Employee A: (2) Employee B: (1) Employee C; and (4) Employer D.
The advantage of this method is that managere rank emplye by pair so assessing them becomes
simpler because it is done w at a time. The employee who has a mediocre performance wher
paired to an outstanding performer, nevertheless, may cause the outstanding employee to
obtain a lower rating as opposed when the latter is evaluated individually.
d. Management by Objective (MBO)

This technique allows an employee to set his/her own goals or objectives by himself/herself for
example, one objective is to increase the sales of AM Food's vinegar to 500,000 bottles before
the next evaluation period. On the next evaluation peri his/her immediate superior (eg, the
sales director) has to find out if the objective is met. If the target is not reached, the product
manager should study the likely reasons for the failure. During the evaluation period, the
director should meet the manager and discuss the ratings based on the achieved objectives.
The director or department head should emphasize that the objectives should be realistic,
challenging, and achievable under normal circumstances.
This technique is ideal because it develops the work commitment of ratees as members of the
team and, thus, motivate them to further excel in performance. Moreover, it focuses on results
that are relevant.
However, it is too individual-focused and mainly based on the goals that have been achieved.
The performance of an individual is not compared with the performance of other employees.
Also, a goal is only set on a short-term basis.
e. 360-degree Feedback
As the term implies, immediate supervisors are not the only raters, Other people also evaluate
the employees. Por example, u purchasing manager is rated by the following other department
managers or peers, suppliers, subordinates and himself/herself. In the academe, college faculty
members are evaluated by the following: the chairperson, peers or co-faculty within the
department, students, and the faculty member himself/herself. This technique is said to be
comprehensive and gives a full-blown evaluation of the employee or an assessment done in a
circular fashion.
The advantage of this technique is that employees are provided with a clear picture on how
others see them as performers. Thus, it gives a more accurate view of their performance. It also
increases their awareness of their competencies, skills, und knowledge because of the more
valid and objective feedback they receive. However, one obvious disadvantage is that not all
employees give honest feedback. There may be politics involved as people become subjective
and provide feedback based on their personal biases against the people being evaluated.
RETENTION
Retention is the act of maintaining the employees in the organization. Entails earning their
loyalty. One of the best ways to do this is to evaluate them Sarly and objectively. There are
certain errors committed by raters who are usually the employees’ immediate supervisors
1. Halo Effect
This usually happens when a rater uses one particular aspect of the employee's good traits. For
example, the employee in always punctual and never absent. He/She is never late and reports
at least une hour earlier than his/her official time. Based on this one factor he/she also gets
high ratings on the quality of his/her work, initiative. flexibility, and relationship with peers,
even though he/she does really display a type of performance that merits high ratings in thes
areas.
2. Ambiguous Evaluation Standards

Ambiguity occurs if one rater's standard for outstanding work performance contradicts that of
another rater from a different department. The former may be hard to please and, therefore,
may only give an above average rating as compared to the latter who may g an outstanding
rating. Supervisors should be very careful in ratite employees and must know the difference
between an outstanding of above average performance because performance evaluation rates
are one of the bases for merit increase. The difference between a best salary increase of +5%
for above average rating and a +10% for att outstanding performance evaluation means a lot to
employees.
3. Stereotyping Effect
Stereotypes may influence the rater's decision as to who will garner a high ranking and who will
earn a low one. For example, raters may not like employees who belong to a certain religious
denomination of those who come from a particular region or province
4. Recency Effect
If recent events prior to the actual evaluation period ure easily remembered and given more
weight than the accumulation of performance behaviors for the whole evaluation period, the
raters commit the recency effect. Bisses occur when these recent employee performances,
whether positive or negative, are given more weight affecting the general rating even if the
overall work performance is not really that favorable.
5. Primacy Effect
Raters may have first impressions of the employees that linger and influence the ratings they
give during an evaluation. For these rates first impressions last and become a dominant
assessment criterion.
6. Central Tendency
In statistics, there are measures of central tendency such as mean median, and mode. The
central tendency deals mostly with the mean or average. The rater avoids putting high and low
ratings (eg, a scale to 5, where 5 is the highest and I is the lowest, and the rater remains neutral
and puta 3 instead). This error diminishes the opportunity for subordinates to get the ratings
they deserve.
7. Hard/Easy to Please Tendencies

There are raters who are hard to please and feel that employees do not meet their expectations
in terms of performance. They set their own high standards that are not only difficult to meet
but are al beyond the standards set by the firm.
On the other hand, many employees get outstanding rating because some raters lower their
standards for outstanding performance Again, these raters fail to comply with the standards set
by the firm.
8. Mirror Effect
This error happens when a raters get affected or influenced by his/ her, immediately preceding
performance assessment of an employee for example, a rater gives an outstanding
performance grade to an employee. Then, the next employee who seems to have an average
performance, may be rated as poor instead because what is reflected in the rater's "mirror" is
still the outstanding performance of the employee they previously evaluated
To eliminate this error, it is suggested that companies provide extensive training programs for
raters. Performance evaluators should practice fair and effective ways of rating. They should
always remember that whatever ratings they provide will affect the employee's morale and
chances for merit increase, promotion, career development, and training
There is a need for all managers and supervisors who conduct performance appraisal to be
trained in the following aspects www. appraisals.naukrihub.com/pa-training.html):
a. methods, techniques, and guidelines for setting goals and objectives

b. ways of evaluating the performance of the employees
c. documentation of performance standards
d. filling out a performance appraisal form
e. prevention of performance evaluation errors
f. questions on appraisal techniques
g. how to answer employee questions and queries
h. improvement of rapport and communication
i. uplifting employee morale and motivation
j. how to observe employee performance
k. how to deal with employer resistance to performance evaluation
l. tracking results
m. providing constructive feedback
n. post-review actions.
Training can be done through special workshops conducted by professional HR consultants or

other experts in the field of HRM Sessions can be held in seminar halls, training rooms,
conference halls, boardrooms, or some other venues far away from the workplace
REMUNERATION
Remuneration refers to payments equivalent to the value of the tasks performed. In
performance evaluation, remuneration is equated with employe higher, lower, or at same level
by either promoting or demoting him/her or ovement or how performance evaluation
transforma an employee's status keeping him/her at the same level. It may also mean quilting
or resigning from the organization
There are four main types of employee movement, namely:
1. Promotion refers to an employee's movement to a higher level or position. Prumotion

decisions can be made either on the basis seniority or through merit based on performance.
Seniority telera one's length of service in an organization. Merit is one's value in term of
performance. Under a straight seniority system, the only factor considered in promotion is
seniority. In the straight seniority system all employees have the chance to get promoted if they
have. with the organization long enough. There is no conflict or competitio among the
employees because the basis for promotion is very cle to them. Employees are not pressured at
work since what they ate building in loyalty to the organization. The disadvantage is that not all
employees want this kind of system to be the basin of moving up the career ladder. Some
employees like to be challenged on the job and the more ambitious employees are not willing
to wait for their turn to ge promoted. This in one reason for the high turnover of highly skilled
personnel. Employees are not motivated to work harder because they are not challenged to
perform better on the job.
Promotion by merit uses qualifications and performance as the basis for promotion. This is ideal
because good performance rewarded. Employees are also encouraged and motivated to
perform well because of promotion opportunities. Performance management is fostered
because employees work their way up the career ladder and the organization promotes
managing performance through the use of the set performance standards. However, it is quite
difficult te gauge merit on the basis of qualifications and performance. There is too much
politics as well as conflicts associated with it. Employees tend to figure in conflicts, and personal
issues arise due to promotion. There are questions about how people are selected for
promotion.
Promotion on the basis of a combined seniority and merit produc mixed reactions because of
the relative ways or variations in applying this system. There are promotions where seniority
has a higher percentage than merit, (e.g., 60% seniority and 40% merit) or c versa.
2. Demotion refers to an employee's movement to a lower level u position. There are

instances when an employee is demoted because of inefficiency or poor performance. Instead
of being terminated, an employee is still given the chance to work in the firm, but in a lower
position.
Here are the steps on how to demote an employee without triggering conflicts and issues of
unfair treatment:
a. Identify the reasons for demoting an employee

The decision to demote an employee is really difficul to make. It is important for a manager to
provide the main reasons for doing so. In essence, it should really be due to the employee's
inability to meet the performance standards set by company.
b. Communicate the decision to the employee

It is imperative to discuss the reasons for the demotion in a meeting. There should be
documents that support the decision. The manager should exercise tact in disclosing the
decision. He/She should discuss it in a professional manner.
c. Make a follow-up after demotion

The manager must observe the employee's reaction after a demotion caused by a job
performance evaluation. He/She should also observe how other employees react to the
changes.
d. Have a contingency plan

A demoted employee may feel demoralized and opt to leave the company instead. The
manager should be prepared when this happens.
3. Transfer is an employee's movement to another position but within the same rank or
responsibility. It is a part of job rotation. For example, an administrative assistant may be
transferred to the same post, but this time in the purchasing department. Transfer may also
mean relocation to another branch if the company has many branches nationwide. Banks
usually move their employees (e.g., tellers and managers) from one branch to another.
There are four types of employee transfers (www.coreht.wordpress.

com/2012/05/03/employee-transfer-2/1):
a. Production transfer
This occurs when there is a shortage of employees in one department and a surplus in another.
Employees who are found to be excesses in the latter department will have to be transferred to
the department where there is a shortage.
b. Replacement transfer
This is replacing or relieving an old employee from a heavy workload.
c. Remedial transfer
This is to rectify a faulty selection in recruitment or placement.
d. Versatility transfer
This provides the opportunity for an employee to increase his/her skills by transferring him/her
from one department to another through job rotation. In most instances, this practice prepares
the individual for promotion.
4. Separation is an employee's movement or leave-taking (departure) from the organization.

It has four sub-types: (a) termination with just cause, (b) termination with authorized cause or
layoff, (c) resignation, and (d) retirement.
a. Termination with just cause is due to the employee's fault company's decision to terminate
the employee because of a fun or valid cause such as malversation of funds, theit, and trau In
another instance, termination with just cause is a res of an employee's failure to undergo the
probationary perio succesfully. Unsatisfactory performance means not meeting the standards
of the company. Therefore, the services of an employ under probation are terminated, or
he/she is not “regularized”.
b. Termination with authorized cause is often called layoffs the company's decision to lay all
employees on any of the Sallowing grounds. First, a new technology has been introduced and
thos are positions which have been evaluated as redundant. These jobs only duplicate the
functions of the newly installed technolog Second, a department or division will be closed
permaneatis as a labor saving measure. The tasks of the office will be take over by another
department. Third, the company will merge with another company. Mergers usually result in
two similar jobs position. If there are two accountants, one has to be retained a the other has
to be laid off. Layotis usually entail fair separation packages no that the employees affected
may start anew in whatever way possible. A severance package helps an employe prepare for
temporary or permanent unemployment. It varies from company to company and from one
employee to another A neverance package may include the following:
 The employee's remaining regular pay
 Additional salary based on remaining months of service
 Payment for unused sick leave
 Insurance
 Retirement benefits
A company, on the other hand, may consider the following m determine how much to offer as
severance pay:
 Current salary of the employee
 Length of service
 Current position
 Performance (for most recent years)
C. Resignation is an employee's voluntary decision to leave the company The reasons for
resignation are varied. Some employees transfer to other companies to obtain higher salaries
and bene Others consider resignation a career move and a chance to k for more challenging
jobs and positions that maximize the skills and potential. A few opt to start and manage their
ow business while a number leave the country to work abroad
One of the pressing problems of companies is employ retention. It is the process by which
management encourge employees to remain with the company. One particular sur under
employee retention is how an organization can presen employees from leaving.
Employees usually resign to look for better opportunities. Today, because mobility has been
made easy, many highly skilled personnel are able to hop from one company to another. It is
relatively uncomplicated for many highly personnel to transfer from one company to another.
They know their value as employees and, therefore, are easily dissatisfied when companies do
not treat them fairly. They are also aware that other companies would accept them
immediately once they decide to apply. The company should address certain issues that lead to
an employee's resignation:
 Compensation. Employees who have high self-worth and know their bankability always
have high expectations regarding the total compensation package Compensation issues
should be discussed before an employee is offered particular job. Employees who
initially have high hopes may end up leaving the company if the latter does not keep its
promise of better salaries and benefits.
 Work Relationships. Aside from compensation, some employees resign because of

broken or uneasy relationships either with his/her immediate superior or with co-
workers in the same area or department. Good relationships affect employee
motivation. Employees are more enthusiastic to work in a positive, conducive
environment. Some employees are greatly affected by how their co-workers support or
relate with them. Some workers are also uncomfortable with superiors whom they
perceive to be unapproachable or unsupportive.
 Major Changes in the Organization. Tenure has become unpredictable in some

industries. Mergers, acquisitions, and closures have adversely affected employees.
Those who were left after massive layoffs think of leaving as well because they felt
insecure and anxious of getting laid off in the future. People who remain after a mass
layoff face uncertainties.
 Organizational Culture. Employees leave upon discovering that the company culture
does not jibe with their personal values. Another aspect of organizational culture is the
way it shows appreciation for a job well done. In other instances, there are employees
who are dismayed at the top management because it is not supportive of highly
effective and worthy, but quite costly. projects.
 Career Development Program. There are companies that do not pursue career
development programs for their employees. People without foresight and incapable of
imagining the possible top positions they may assume later on in their careers may opt
to resign early. Highly skilled employees do not want to remain in the same position or
level during their entire tenure in a compe If there are no career opportunities in their
own company they may seek them somewhere else.
d. Retirement. It is the end of an employee's career in a company This happens to people

between the ages of 60 and 65 ye It signals a new beginning for retirees and the opportunity
them to do other things. An employee retires from an organizati either satisfied or dissatisfied
depending on how he/she c his/her entire work experience.
 Early retirement. It is availed of by employees who have health-related issues. Due to

poor health, a compa may decide to terminate an employee even before his/her actual
retirement age. If it is deemed necessary for the employee to leave the company
permanently to rest ane recover from an ailment, then this is also considered
retirement. Other issues related to retirement are also discussed in the chapter on
career management.
HR POINTS TO PONDER
PERFORMANCE MANAGEMENT
As an HR manager, you like to develop a pay-for-performance plan to realize this, there should
be a good performance appraisal. Rank the following activities based on priority:
1. Train the supervisors in conducting performance evaluation.
2. Make sure all the managers and supervisors understand the performance management
system
3. Develop a new performance appraisal form
4. Know and understand the things to consider in the performance management cycle.
TRENDING IN HR
PERFORMANCE MANAGEMENT
Nowadays, the performance of employees is managed well according to company's corporate
culture. The current trend is to build a high-performance culture where employees strive to
align their performance with the company's mission and vision. Because of globalization,
companies should encourage employees to do their jobs excellently, use their skills, and
maintain a high-performance level at all times.

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any organization. It is an employee-focused office that serves all departments.

HUMAN RESOURCE PLANNING

JOB ANALYSIS/ JOB DESIGN; RECRUITMENT, SELECTION AND PLACEMENT

TRAINING AND DEVELOPMENT; CAREER MANAGEMENT

PERFORMANCE APPRAISAL; COMPENSATION AND BENEFITS

EMPLOYEE RELATIONS AND DISCIPLINE

Figure 1 - Schematic Diagram of Human Resource Management

Under job analysis/design and recruitment/selection/placement, the key responsibilities are

HUMAN RESOURCE PLANNING

Figure 2 Link between Strategic Planning and Human Resource Planning

The HRP process is summarized in the following diagram.

Action Plan/ Program Implementation

Figure 3- Human Resource Planning Process

B. FORECASTING HUMAN RESOURCE REQUIREMENTS

1. The Human Resource Planning (HRP)

The following personnel should be considered in the HRP team:

2. Current and Long-term Workforce Requirements

It is also important to be concerned with long-term workforce requirements. During HRP, a

3. Evaluation of the company's current roster of personnel

a. Forecasting external supply

b. Forecasting internal supply

Methods of Forecasting Internal Labor Supply

However, trend analysis is limited to organizations with stable HR trends. In complex

The obvious advantage of succession planning is that it adequately prepares successors to

Table 1- Sample Markov Analysis

Actual Headcount in 2012

Predicted Number of Employees in 2013

Prod-Production Non-prod- Non-Production

Table- Magnitude of Correlation Coefficient

However, the process is time-consuming and somewhat subjective in nature. Another

2. Nominal Group Technique

D. ACTION PLAN/IMPLEMENTATION OF THE PROGRAM

a. Labor equilibrium or labor demand equals labor supply

b. Labor surplus or labor supply is more than labor demand

c. Labor shortage or labor demand is more than labor supply

HUMAN RESOURCE PLANNING

Rank your priorities according to importance.

A QUICK LOOK INTO HUMAN RESOURCE PRACTICES IN EDUCATIONAL INSTITUTIONS

HISTORICAL BACKGROUND OF HRM

The development of small- to large-scale production led to the establishment of organizational

The B.F. Goodrich Company pioneered in having an employee-focused department which

HUMAN RESOURCE DEVELOPMENT

HUMAN CAPITAL MANAGEMENT

The following information can be collected through job analysis:

1. Specific tasks and activities

2. Required behavior on the job

3. Required job standards

4. Knowledge, tools, and equipment used

6. Personal characteristics and requirements

3. Application of job analysis techniques

4. Actual conduct of job analysis

5. Preparation of job description and job specification

b. Recruitment and selection

f. Safety and health

The following are a various job analysis techniques:

To sum up, a job description has the following parts:

d. General description of the job

e. Specific duties and responsibilities

Figure 5- Recruitment, Selection and Placement Model

The following are the main steps in recruitment:

2. Position announcement/Job posting

Table 4 ~ Sources of Applicants

Table 5 - Comparison of the Two Sources of Applicants