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CHAPTER EIGHT

Managing Human Resources

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 LEARNING OUTCOMES

In this chapter, you will learn to:

 Describe Human Resource Management (HRM) and
explain its significance.
 Describe the various functions of HRM in organizations.
 Explain the human resource planning process.
 Describe recruitment and explain the types of
recruitment that can be adopted by organizations.
 Explain how companies find qualified job applicants
from outside the organization.

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 LEARNING OUTCOMES (cont.)

 Describe the general selection process used in

organizations.
 Distinguish between training and development.
 Discuss the main purposes of performance appraisal.
 Describe the types of benefits in Malaysia.
 Explain the types of unions in Malaysia.
 Describe collective bargaining and collective
agreement.

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 HUMAN RESOURCE
MANAGEMENT

• Human Resource Management (HRM) is a

discipline that focuses on managing human talent in
organizations through integrated HR practices,
policies and systems.
• The main objective of HRM is to ensure human
resources are managed effectively and efficiently, so
that their efforts can be directed towards achieving
organizational goals.
• Good HRM can play an important strategic role in
attracting, managing and retaining human talent in
organizations.
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 HUMAN RESOURCE
MANAGEMENT FUNCTIONS

• There are seven

functional areas in
HRM.
• All HR functions are
interrelated and each
function plays an
important role to
facilitate the process
of managing HRs in
organizations.

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 HUMAN RESOURCE PLANNING

• HRP is a process of assessing and identifying

future HR needs of an organization to fulfil the
strategic plan established by its top management.
• HRP helps managers to determine employee
requirements and assist in reducing uncertainty
about the future.

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 HUMAN RESOURCE PLANNING
PROCESS

HRP is important to:

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 RECRUITMENT

• Recruitment is the process of seeking and attracting

the right potential candidates to apply for job
vacancies in an organization.
• Internal recruitment
– Seeking current employees to fill in job openings
in the organization.
• External recruitment
– Attracting and obtaining applications from
individuals outside the organization.

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 INTERNAL VS. EXTERNAL
RECRUITMENT

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 JOB DESCRIPTION,
JOB SPECIFICATION
AND JOB ANALYSIS
• Job description describes the tasks, duties and
responsibilities (TDRs) of a job.
• Job specification describes the required knowledge,
skills, abilities and other characteristics (KSAOs) of
the job holder.
• Job analysis is the process of gathering detailed
information of the job scope of a job, and the
knowledge, skills and abilities required to perform
the job well.
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 EXTERNAL RECRUITMENT
METHODS

• Media advertising
• Employment agencies
• Referrals by current employees
• Campus recruitment
• Internet recruitment

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 SELECTION

• Careful selection decision is powerful to determine

the success of an organization.
• Good selection process must be in place so that the
best applicants can be hired.
• Selection is the process of selecting the best
applicants for a particular position in the
organization.

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 SELECTION PROCESS

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 TRAINING AND DEVELOPMENT

• Training is the process of developing the skills,

knowledge and abilities of employees to enable them to
perform their present job successfully.
• Development is the process of learning beyond the
current job.
• Benefits of training and development to organizations
include:
– Better performance
– Higher retention
– Improved recruiting
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 TRAINING AND DEVELOPMENT
PROCESS

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 NEEDS ASSESSMENT
FOR TRAINING

• To determine training needs, three types of

analysis are conducted:
– Organizational analysis
– Task analysis
– Person analysis

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 TRAINING AND DEVELOPMENT
METHODS

• „Lecture or classroom-based programmes

• „Mentoring and coaching (on-the-job training)
• „Case studies, business games and business
simulations
• „Videos and CDs
• „Simulations and/or virtual reality
• „Computer-based training
• „Web-based learning (online learning)

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 EVALUATE TRAINING AND
DEVELOPMENT PROGRAMMES

• Learners’ reactions
• „The extent of learning
• Behavioural change
• Performance and results

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 PERFORMANCE APPRAISAL

• Performance appraisal is the process of evaluating

employees’ performance against a set of
predetermined performance criteria, communicating
feedback on performance standard and establishing
plans for future improvement.

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 PURPOSES OF
PERFORMANCE APPRAISAL

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 WHO SHOULD CONDUCT A
PERFORMANCE APPRAISAL?

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 RATING ERRORS

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RATING ERRORS (cont.)

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 RATING ERRORS (cont.)

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 EMPLOYEE COMPENSATION

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 PAY EQUITY

• The concept of equity (fairness) is important in

a compensation system.

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 FACTORS AFFECTING
COMPENSATION

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 INDIRECT FINANCIAL
COMPENSATION

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 BENEFITS AND MALAYSIAN
LEGISLATION

• „Employment Act 1955

• „Employees Social Security (SOCSO) Act 1992
• „Employees Provident Fund Act (amended 1991)

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 EMPLOYEE RELATIONS

• Employee relations refers to the relationships

between employers and their employees.
• Legislations related to employee relations in
Malaysia include:
– Trade Union Act 1959
– Industrial Relations Act 1967

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 WHY DO EMPLOYEES
JOIN UNIONS?

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 TYPES OF UNIONS

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 COLLECTIVE BARGAINING

• Collective bargaining is the process by which

representatives of the employees (the trade union)
negotiate and discuss with the representatives of
employers on employment issues.
• The outcome of a successful collective bargaining
process is a collective agreement, a written contract
between an employer and a trade union on terms
and conditions of employments.

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 TRADE DISPUTES

• When negotiation fails, trade disputes (also called

industrial disputes) occur.
• Picketing
– A peaceful means to persuade workers not to work
in support of a trade dispute.
• Strike
– A collective decision of the union members not to
work in order to exert pressure on
management/employers until demands and
conditions are met.
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