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Human Resource Management

Overview Definitions  Why important  Key issues  Good HRM Historical development  HRM activities  The Irish context

A Question of Definition
Personnel Management .is a series of activities which: first enables working people and the organisation which uses their skills to agree about the objectives and nature of their working relationship and, secondly ensures that the agreement is fulfilled. (Torrington & Hall, 1995)

Human Resource Management

refers to the practices and policies needed to cover the human aspect of management. is the part of the management process that specializes in the management of people in work organisations.

risk of comparing an idealised version of Human Resource Management with a worked and problematic version of Personnel Management.

HRM 3 Differences
1. 2. Inclusive of management Personnel policies goals strategic


Culture of commitment rather than compliance

(Legge 1989)

The Human Resource Approach

Employee motivation & applied ability

Quality & quantity of work

Employee rewards & recognition

organisational productivity & profit

Why is it important?
Extremely high competition More countries with low wages & high skilled workers Rapid technological advances Changing legal, political & social realities Changing values & educational levels Changing consumer demands

Key Issues
Pivotal? Essence-individual differences Variation across organisations Generalist/Specialist function Personnel V s H.R.M. Management Style

Successful companies need people who are

Adaptable - Committed - Motivated - Skilled/re-skilled - Energetic Good team players

Core Objectives of HRM


Staffing Performance Change management Administration

Goals of HRM:
General Productivity QWL Legal compliance Competitive advantage Specific attracting retaining motivating retraining

Good Human Resource Practice

Recognize people s needs & expectations Respect the individual Provide justice in treatment Provide stable employment And

Provide good working conditions Opportunities for career progression & personal development Function as a democracy Observe the law & codes of conduct relating to employment

Hard V s Soft HRM

(Torrington & Hall 2002) Hard
Workers are a resource like any other resource

Workers are key to competitive advantage and must be nurtured & developed

Not mutually exclusive HRM is fundamentally unitarist

Who is Responsible?
Line managers HR professionals Consultants/sub-contractors employees

Current Issues in HRM


Responding to intensified competition Managing international operations Technological innovation Complying with the law Managing with/without trade unions Ethical concerns** Best practice V s Best fit

Best Practice V s Best Fit

Best Practice:
best way of carrying out HR activities that is universally applicable advanced selection methods, serious commitment to employee involvement, substantial investment in T&D etc. all is contingent on the circumstances of each organisation

Best Fit:

Some Ethical Concerns


Dismissing someone for incapability Failing to dismiss a senior manager Paying women less than men Pressure to change hours or location Paying less when you can pay more Failing to tell the truth at a tribunal Failing to make costly H&S alterations

HRM Activities
Strategy Formulation 2. Human Resource Planning 3. Recruitment & Selection 4. Appraisal & Performance Mgt. 5. Reward Management 6. Training & Development 7. Employee Relations 8. Administration


Reward Employee Relations

The Strategic Core

Resourcing Performance


The execution of strategy lies in the hands of individuals and therefore no matter how good the strategy is, if it fails to take account of the people element it is doomed to failure at worst or to partial success at best.
(Gunnigle et al 1997)

Organisational Strategy & HR Strategy

OS HRS Separation







Torrington & Hall 2002

OS HRS Holistic



HR Driven

Human Resource Planning Process



recruitment; training & development; redundancy, dismissals; redeployment; employee relations; organisation development IMPLEMENT & REVIEW

Current + Future Demand for labour

Current Supply of labour

The Recruitment & Selection Process

Human resource planning Job analysis Recruitment Selection Induction

Performance Management

2. 3. 4.

5. 6.

Clear objectives are essential for effective performance Communication is good Involvement Commitment Everyone s work should relate to the organisation s work People need feedback Responsibility and autonomy enrich jobs

Establish, communicate & agree objectives

Evaluate performance

Communicate Decisions & results

Compare performance with objectives

Take corrective action Review objectives Continue unchanged

Decide on appropriate action

Appraisal Systems


Formalise the review part of the performance cycle Usually annual/bi-annual Form based Link to pay? One way V s two way

The Appraisal Interview

Tell-and sell Tell-and listen Joint-problem-solving

Reward Package =
Pay + incentives + benefits
- Pay = basic wage - Benefits = indirect rewards (eg. Car, VHI, expenses) - Incentives = performance beyond expectations (eg. Bonus, awards, share options)

Objectives of Reward Package

Attract employees Retain good employees Motivate Contribute to H.R. strategy

Effective Reward System

Satisfies basic needs Flexible Internal equity External equity Trust (management & staff believe in it)

Training & Development

- Assessment of need - Design & delivery - Transfer & evaluation

The Evidence For Change

Growth of A-typical employment Flexibility debate Technological revolution Quality initiatives Management-employee communications

Partnership Model
Employers recognise & facilitate worker & T.U. involvement in strategic decision making Workers/T.U. s commit to productivity improvements Gains shared Productivity improvements expansion business

Cutting Edge of HRM

Key changes:
Attendance management performance

Use of management to implement HR strategy Emphasis on communication & training as tools Belief in potential of people to yield competitive advantage

Quarterly employee lunches Employee Resource Centre Meetings culture Profit sharing Flexible working arrangements 360 feedback

Vision based on 5 core principles:

1. 2. 3. 4. 5.

Total quality Total involvement Management by facts Emphasis on H&S Clear objectives

Strategic responses to increased competition

1. Widespread rationalisation, redundancies, contracting-out, delayering 2. Mergers, acquisitions, strategic alliances 3. Enterprise level partnership

Human resources is not fluffy

(Sunday Times Jan 2002)


18 of FTSE 100 have board representation for HR Need to focus on best fit as well as best practice Need to quantify & communicate contribution HR is not touchy-feely often left with controversial decisions that no one else will deal with

A higher status for the people person (Financial Times 29/01/02)


HR managers need to understand how their jobs have changed Need to be involved in looking for talented recruits, working on top level succession and helping to devise the long-term strategy of the organisation Dominated by professional rather than administration staff Report to the CEO & sit on the board