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Introduction to Human

Resource Management

Professor Mohammad Khasro MIAH Ph.D.


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Introduction to HR
The 1980s and 90s saw Human Resource

Management(HRM) replace Personnel


Management
fashionable term
re-organisation of work of personnel department
distinctively different with new management approach

Long term rather than short term perspective


Psychological contract of commitment
Self-control rather than external controls
Management integration
Maximum utilisation of resource

Human Resource
Management
HRM is the organizational function

that deals with issues related to


people such as hiring, training,
promotion, performance
management, compensation,
organization development, safety,
wellness, benefits, employee
motivation, communication,
administration and Industrial
relations.
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Therefore, human resource management can be

defined as a specific combination of HR


practices, work structures, and processes that
maximizes employee knowledge, skill,
commitment, and flexibility.
It composed of many interrelated parts that
complement one another to reach the goals of
an organization, large or small.
Set of activities directed at attracting,
developing, and maintaining an effective
workforce capable of achieving the firms
objective.

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The main activities of human


resource management
The areas that we would list are as follows:

recruitment and selection


learning and talent development
human resource planning
provision of contracts
provision of fair treatment
provision of equal opportunities
managing diversity
motivating workers to achieve improved performance
employee counseling
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redundancy
negotiation
encouraging involvement and engagement
adding value
ethics and corporate responsibility
knowledge management
change management
managing cross-cultural issues or international

HRM.
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talent management
employee wellbeing
payment and reward of employees
health and safety
disciplining individuals
dealing with grievances
dismissal

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Historical Turning Points in HR


1793
1886
1890
1907
1909

Samuel Slater father of Industrial Revolution in US


American Federation of Labor (AFL) 1st union in US
Sherman Antitrust Act - balance power of mgmt & labor
Immigration Act of 1907 slowed labor growth
Frederick Winslow Taylor scientific mgmt

1911 Triangle Shirt Waist Company fire attention to


employee Safety
1913 Henry Ford 5$ day; systematic tng; tenure-based
outcomes
1914-1918 World War I systems approach to empl. testing;
1926 Railway Labor Act 1st govt policy to encourage unions,

Historical Turning Points in HR

1930s Early HR Research


Hawthorne Experiments (1927-1932)
Maslows Need Hierarchy (19391943)
McGragors Theory X & Y (1960)
Herzbergs Motivators and Satisfiers
(1960)
George Odiornes Management By
Objectives (1965)

Historical HR (cont)
1932 Norris-LaGuardia Act yellow-dog contracts were unenforceable
1935 Social Security Act beginning of social welfare
1935 National Labor Relations Act prohibits employer unfair practice,
NLRB

1938 Fair Labor Standards Act minimum wage, exempt/nonexempt,


overtime

1941-1945 World War II women in workforce, health care introduced


1946 Numerous labor strikes
1947 Taft-Hartley Act unfair labor practices for unions/outlaws closed shop
1954 Brown vs. Topeka Board of Education integrates schools
1964 Civil Right Act of 1964 creates EEOC
1965 Equal Employment Opportunity Commission (EEOC) enf EE
1970 Occupational Safety and Health Act (OSHA) ERISA (1974),

others

1977 Human Resources Planning Society (now SHRM)


1979 Office of Personnel Management personnel function more visibility

Historical HR (cont)
1980s Stock option developed for high level execs
1981 Professional Air Traffic Controllers (PATCO) strike decline
of unions

1985 Sperry Rand & Burroughs merge to form Unisys


First of mergers and acquisitions
Corporate downsizings
1987 PeopleSoft Inc first HR management software
1980s (late) Global competition increases
1991 Clarence Thomas-Anita Hill hearings - sexual harassment
1994 Monster Board online recruiting
1999 BP Amoco and Exult $600M outsourcing arrangement (1st for HR)
2001 World Trade Center attack security on everyones job
2001 Fraud at Enron govt reform - SOX
2006 IBM permanently stop defined benefit pensions decline of
benefits
2008

Government provides TARP funds to bankrupt businesses

Hard and Soft HRM


'Storey (1989) has distinguished between hard

and soft forms of HRM, typified by the Michigan


and Harvard models respectively. 'Hard' HRM
focuses on the resource side of human
resources. It emphasizes costs in the form of
'headcounts' and places control firmly in the
hands of management. Their role is to manage
numbers effectively, keeping the workforce
closely matched with requirements in terms of
both bodies and behaviour. 'Soft' HRM, on the
other hand, stresses the 'human' aspects of
HRM. Its concerns are with communication and
motivation. People are led rather than managed.
They are involved in determining and realizing
strategic objectives.'

Hard and Soft HRM


Hard HRM: A different view of HRM is

associated with the Michigan Business


School (Fombrun, Tichy and Devanna,
1984). There are many similarities with the
Harvard 'map' but the Michigan model has
a harder, less humanistic edge, holding
that employees are resources in the same
way as any other business resource.
People have to be managed in a similar
manner to equipment and raw materials.
Thay must be obtained as cheaply as
possible, used sparingly, and developed
and exploited as much as possible.

The Michigan model is also known as the

'matching model' or 'best-fit' approach to


human resource management. In essence,
it requires that human resource strategies
have a tight fit to the overall strategies of
the business. As such, it limits the role of
HR to a reactive, organizational function
and under-emphasizes the importance of
societal and other external factors. For
example, it is difficult to see how the
current concern for worklife balance could
be integrated into this model.

Harvard Model
A large part of this section is devoted to the Harvard

'map' of HRM. This is probably the most seminal model


of HRM and has had a major influence on academic
debate on the subject.
'We noted that the Harvard Business School generated
one of the most influential models of HRM. The Harvard
interpretation sees employees as resources. However,
they are viewed as being fundamentally different from
other resources - they cannot be managed in the same
way. The stress is on people as human resources. The
Harvard approach recognizes an element of mutuality
in all businesses, a concept with parallels in Japanese
people management, as we observed earlier.
Employees are significant stakeholders in an
organization. They have their own needs and concerns
along with other groups such as shareholders and
customers.'

The Harvard Map or model


outlines four HR policy
1 Human resource flows areas:

recruitment, selection, placement,


promotion, appraisal and assessment,
promtion, termination, etc.
2 Reward systems - pay systems,
motivation, etc.
3 Employee influence - delegated
levels of authority, responsibility,
power
4 Work systems - definition/design of
work and alignment of people.

Which in turn lead to the


'four C's' or HR policies
that have to be achieved:
Commitment
Congruence
Competence
Cost effectiveness

Soft and Hard HRM


Soft HRM emphasizes the importance of high

commitment, learning, enlightened leadership; human


resources are valuable assets, not variable costs.

Models and theories focus on tapping the human


potential, based on organizational behavior theories
(e.g. Maslow,
1954; Herzberg, 1966; McGregor, 1960; Miah and Bird
2007)
Hard HRM emphasizes the calculative, quantitative
and strategic management aspects ( Strategy,
Structure, System) and of managing the workforce in a
rational way (Storey, 1989).

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Evolution of HRM
Human resource management has

changed in name various times


throughout history.
Industrial welfare was the first form of
human resource management (HRM).

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Evolution of HRM
In 1833 the factories act stated that there

should be male factory inspectors.


In 1878 legislation was passed to regulate
the hours of work for children and women
by having a 60 hour week. During this
time trade unions started to be formed.
In 1868 the 1st trade union conference
was held.
This was the start of collective bargaining.
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Evolution of HRM
In 1916 it became compulsory to have a

welfare worker in explosive factories


and was encouraged in arms factories.
The armed forces focused on how to

test abilities and IQ along with other


research in human factors at work.

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Evolution of HRM
1917-18: 1st formal personnel department created to deal
with tight labor market, high turnover, waste and
inefficiency, widespread strikes, union growth,
government intervention, takeovers
1920s: HR used to win worker cooperation, through
ensuring job security, benefits, etc.
1930-50s: Human Relations recognizes that there are
psychological and social influences to worker
satisfaction, cooperation, performance; first focus on
groups (not teams).
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Evolution of HRM
1960s: Work design, rather than communication and

cooperation in groups, is the key to increasing worker


motivation. Small work group design leads to greater employee
effort, group work provides opportunities for self-actualization;
work is more interesting and fulfilling.
1970s: Quality of Work Life (QWL): emphasis on the value

of human resources. PM becomes HR.


1990s-Present: TQM, reengineering, globalization, strategic

HR, new technologies, diversity, contingency models, holistic


approaches to HR. HRM models include high involvement,
high commitment, high performance work system,
innovative work practices. HR becomes HRM.

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The Management Process


Planning

Controlling

Leading

Organizing

Staffing

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Human Resource Management at


Work
Acquisition

Training

Fairness

Health and
Safety

Labor Relations

Human
Resource
Management
(HRM)

Appraisal

Compensating
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Personnel Aspects of a
Managers Job
Conducting job analyses
Planning labor needs and recruiting job candidates
Selecting job candidates
Orienting and training new employees
Appraising performance
Managing wages and salaries
Providing incentives and benefits
Communicating
Building employee commitment

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DIFFERENCES BETWEEN TRADITIONAL AND NEW HRM


Factors

Traditional HR

New HRM Concept

Responsibility
of HR
Focus

Staff specialists

Line managers

Employee relations

Partnership with internal


and external
customers and
stakeholders

Role of HR

Transactional, change
follower and
respondents

Transformational, change
leader and initiator

Initiatives

Slow reactive,
fragmented

Fast, proactive,
integrated

Time Horizons

Short term

Short, median and long as


necessary

Control
Job Design
Key

Bureaucratic- rules,
policies, procedures
Tight division of labor,
independence,
specialization

Organic- flexible,
whatever is needed to
succeed
Broad, flexible, crosstraining

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Basic HR Concepts
The bottom line of

managing: Getting
results
HR creates value by

engaging in activities that


produce the employee
behaviors that the
company needs to achieve
its strategic goals.
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Line and Staff Aspects of


HRM
Line manager
A manager who is authorized to direct

the work of subordinates and is


responsible for accomplishing the
organizations tasks.

Staff manager
A manager who assists and advises line

managers.

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Human Resource Managers


Duties
Coordinative
Function

Line Function
Line Authority
Implied Authority

Functional Authority

Functions of
HR Managers

Staff Functions
Staff Authority
Innovator
Employee Advocacy

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Line Managers HRM


Responsibilities
1. Placing the right person on the right job
2. Starting new employees in the organization

(orientation)

3. Training employees for jobs that are new to them


4. Improving the job performance of each person
5. Gaining creative cooperation and developing

smooth working relationships

6. Interpreting the firms policies and procedures


7. Controlling labor costs
8. Developing the abilities of each person
9. Creating and maintaining department morale
10. Protecting employees health and physical condition
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Human Resource Specialties


Recruiters

Labor Relations
Specialists

Training
Specialists

Human
Resource
Specialties

EEO
Coordinators

Job Analysts

Compensation
Managers

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A Systems View of
Human Resource Management

1 - 34

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Goals of Human Resource


Management

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Human Resource Management


as a Center of Expertise

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FIGURE 11 HR Organization Chart

for a Large Organization

Source: www.hr.wayne.edu/orgcharts.php. Accessed May 6, 2007.

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FIGURE 12

HR Organizational Chart (Small Company)

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FIGURE 13

Employment and RecruitingWho Handles It?


(Percentage of All Employers)

Note: Length of bars represents prevalence of activity among all surveyed employers.
Source: HR MAGAZINE, BNA/Society for Human Resource Management, 2002.
Reproduced with permission via Copyright Clearance Center.

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The Changing Environment


of Human Resource
Management
Globalization Trends

Changes and Trends


in Human Resource
Management

Technological Trends

Trends in the Nature of Work

Workforce Demographic Trends

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FIGURE 14

Employment migration: Projected Loss of Jobs and Wages

Source: Michael Schroeder, States Fight Exodus of Jobs, Wall Street Journal, June 3, 2003,
p. 84. Reproduced with permission of Dow Jones & Co. Inc. via Copyright Clearance Center.

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The Changing Role of


Human Resource Management
Strategic Human
Resource
Management

Managing with the


HR Scorecard
Process

New
Responsibilities
for HR Managers

Creating HighPerformance Work


Systems

Measuring the HRM


Teams Performance

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TABLE 11

Technological Applications for HR

Application Service Providers (ASPs) and technology outsourcing


Web portals
PCs and high-speed access
Streaming desktop video
The mobile Web and wireless net access
E-procurement
Internet- and network-monitoring software
Bluetooth
Electronic signatures
Electronic bill presentment and payment
Data warehouses and computerized analytical programs

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High-Performance Work System


Practices
Employment security
Selective hiring
Extensive training
Self-managed teams/decentralized decision making
Reduced status distinctions
Information sharing
Contingent (pay-for-performance) rewards
Transformational leadership
Measurement of management practices
Emphasis on high-quality work
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Benefits of a HighPerformance
Generate
more job
applicants(HPWS)
Work
System

Screen candidates more effectively


Provide more and better training
Link pay more explicitly to performance
Provide a safer work environment
Produce more qualified applicants per position
Hiring based on validated selection tests
Provide more hours of training for new employees
Conduct more performance appraisals
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FIGURE 15

Five Sample HR Metrics

HR Metric*

How to Calculate It

Absence rate

# of days absent in month


Average # of employees during month # of workdays

Cost per hire

100

Advertising + agency fees + employee referrals + travel cost of


applicants and staff + relocation costs + recruiter pay and benefits
Number of hires

HR expense
factor
Time to fill

HR expense
Total operating expense
Total days elapsed to fill job requisitions
Number hired

Turnover rate

Number of separations during month


Average number of employees during month

100

Sources: Robert Grossman, Measuring Up, HR Magazine, January 2000, pp. 2935; Peter V. Le Blanc, Paul Mulvey, and Jude T. Rich, Improving the Return on Human Capital: New Metrics,
Compensation and Benefits Review, January/February 2000, pp. 1320; Thomas E. Murphy and Sourushe Zandvakili, Data and Metrics-Driven Approach to Human Resource Practices: Using
Customers, Employees, and Financial Metrics, Human Resource Management 39, no. 1 (Spring 2000), pp. 93105; [HR Planning, Commerce Clearing House Incorporated, July 17, 1996;] SHRM/BNA
2000 Cost Per Hire and Staffing Metrics Survey; www.shrm.org. See also, SHRM Research 2006 Strategic HR Management Survey Report, Society for Human Resource Management..

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Measuring HRs
Contribution
The HR Scorecard

Shows the quantitative

standards, or metrics the firm


uses to measure HR activities.
Measures the employee

behaviors resulting from these


activities.
Measures the strategically

relevant organizational
outcomes of those employee
behaviors.
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The Human Resource Managers


Proficiencies
New Proficiencies
HR proficiencies
Business proficiencies
Leadership proficiencies
Learning proficiencies

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FIGURE 16 Effects CFOs Believe Human Capital Has on Business


Outcomes

Source: Steven H. Bates, Business Partners, HR Magazine, September 2003, p. 49. Reproduced
with permission of the Society for Human Resource Management via Copyright Clearance Center.

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HR Certification
HR is becoming more

professionalized.
Society for Human Resource

Management (SHRM)
SHRMs Human Resource Certification

Institute (HRCI)
SPHR (senior professional in HR)
certificate
PHR (professional in HR)
certificate
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FIGURE 17
2004 SHRM
Learning
System
Module
Description
s

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The Human Resource Managers


Proficiencies (contd)
Managing within the Law
Equal employment laws
Occupational safety and health laws
Labor laws

Managing Ethics
Ethical lapses
Sarbanes-Oxley in 2003

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An integrated approach to people resourcing

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HR strategy: the integration of HR activities to


manage performance

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HRM in the twenty-first century?

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K E Y

T E R M S

management process

globalization

human resource
management
(HRM)

human capital

authority
line manager
staff manager
line authority
staff authority
implied authority
functional control
employee advocacy

strategy
strategic plan
metrics
HR Scorecard
outsourcing
ethics
strategic human resource
management
high-performance work
system

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