Human Resource Management

12th Edition
Chapter 1- STRATEGIC HUMAN RESOURCE MANAGEMENT:AN
OVERVIEW
 HRM Functions

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What is Human Resource Management (HRM)?
Utilization of individuals to achieve organizational objectives
Concern of all managers at every level

Staffing: Process of ensuring the organization always has:

•Proper number of employees

•Employees with appropriate skills

•Employees in the right jobs at the right time

Job Analysis
Systematic process of determining skills, duties, and knowledge
required for performing jobs in organization
Impacts virtually every aspect of HRM

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Human Resource Planning
 Matching internal and external supply of people with anticipated job openings
over specified period of time
 Sets the stage for recruitment or other HR actions

Recruitment: Attracting individuals to apply for jobs

• Must be timely, applicants need appropriate qualifications

• Need sufficient number of applicants

Selection: Choosing individual best suited for a particular position and the
organization
Human Resource Development: Major HRM function which includes:
 Training & Development
 Career planning, Career development
 Organization development
 Performance management, Performance appraisal

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Training and Development
Training: Providing learners with knowledge and skills needed for their present jobs
Development: Offering learning that goes beyond present job--Long-term focus.
Career Planning & Development
Planning is an ongoing process.
• Individual sets career goals
• Identifies means to achieve them
Development is a formal approach used by the organization.
• Ensures a pipeline of people with proper qualifications and experiences
OD: Planned and systematic attempt to:
 Make the organization more effective & Create positive behavioral environment

Performance Management
Goal-oriented process to ensure organizational processes are in place to maximize
productivity
Applies to employees, teams, and ultimately, the organization

Performance Appraisal: is a Formal system of review and evaluation

1-5  Individual & Team
Compensation: All rewards that individuals receive as a result of their employment
Financial Compensation:
Direct: Pay employee receives in form of wages, salaries, bonuses, or commissions
Indirect: Benefits employee receives
•Paid vacations, sick leave, holidays, medical insurance
Non-Financial Compensation: Satisfaction that person receives from:
 Job itself
 Psychological and/or physical environment
Safety & Health: Protecting employees from injuries caused by work-related accidents

Health: Employees' freedom from illness and their general physical and mental well-
being
Labor Unions and Collective Bargaining
Businesses are required by law to recognize a union and bargain with it in good faith
if the firm’s employees want the union to represent them.
Human resource activity with a union is often referred to as industrial relations (IR).

Internal IR: HRM activities associated with the movement of employees within the
organization
1-6 : Promotions, Demotions, Terminations, Resignations
 Environment of Human Resource Management

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Legal Considerations
Federal, state, and local legislation,Court decisions, Govt. orders
Labour Market: Potential employees located within certain geographic
area, Always changing
Economy: When economy is booming, it is often more difficult to recruit
qualified workers.
 In economic downturn, more applicants are typically available
Unanticipated Events: Unforeseen occurrences in external environment
 Require a tremendous amount of adjustment with regard to HRM

Society
Ethics: Deals with what is good and bad, or right and wrong, and with moral
duty and obligation
Corporate social responsibility: Implied, enforced, or felt obligation of
managers to serve or protect interests of groups other than themselves.
Union: Group of employees who have joined together to collectively bargain
with their employer, Become a third party when dealing with the company
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Shareholders: Owners of corporation who have invested money in firm, may
at times challenge programs considered by management to be essential.
Competition: In product or service and labor markets
 Firms must maintain a supply of competent employees
 Bidding war often results –for filling critical position
Customers: People who actually use firm’s goods and services.
 Employment practices should not antagonize members of the market the
firm serves.
 Workforce should be capable of providing top-quality goods and services.
HR Technology: Rapid technological changes provide:
 Increased sophistication
 Ability to design more useful human resource information systems (HRIS)
HRIS: An organized approach for obtaining information on which to base HR
decisions
 An umbrella for merging the various subsystems
 Mainstay HR responsibilities need an HRIS
 HR’s Changing STRATEGIC Role
HR’s Changing Role: Questions
 Can some HR tasks be performed more efficiently by line
managers or outside vendors?
 Can some HR tasks be centralized or eliminated?
 Can technology perform tasks that were previously done by
HR personnel?
Who Performs HR Management Tasks?
 Human resource managers
 HR outsourcing
 HR shared service centers
 Professional employer organization (employee leasing)
 Line managers
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 Human Resource Manager
Historically, the HR manager was responsible for each of
the five HR functions.
Acts in advisory or staff capacity.
Works with other managers to help them deal with human
resource matters.
Today, HR departments continue to get smaller.

HR Outsourcing
Transfers responsibility to an external provider
Discrete services
Multi-process services
1-11 Business process outsourcing (BPO)
 Discrete Services
Single set of high-volume repetitive functions is outsourced
to a third party
Typically transactional HR activities
Legal/compensation related administration

Multi-Process Services
Complete outsourcing of one or more human resource
processes.
Example: Procter & Gamble outsourced training operations.

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 Business Process Outsourcing (BPO)
Majority of HR services are transferred to third party.
Example: Whirlpool Corporation signed 10-year deal
to outsource HR business.
Kraft Foods Inc. and IBM signed a multi-year BPO
agreement.

HR Shared Service Centers (SSCs)

Takes routine, transaction-based activities that are
dispersed and consolidates them in one location

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 Professional Employer Organization (PEO)

(Employee Leasing)

Company that leases employees

to other businesses
Advantages:
Economies of scale
Greater job mobility for workers
Job security through leasing company
PEO can handle compliance requirements
of programs

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 Line Managers Performing
HR Tasks

Involved with human resources by

nature of their jobs
Now performing some duties
typically done by HR

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 Evolution of HRM
HR Executives, Generalists, and Specialists

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 Traditional Human Resource
Function in Large Firm
Included separate sections.
Sections are placed under an HR manager.
Each HR function may have a supervisor and staff.
HR manager works closely with top management in
formulating policy.

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 The Evolving HR Organization
HR outsourcing

HR shared service centers

Professional employer organization

Line manager

HR becoming more strategic

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 A Possible Evolving HR Organization
Example:

President
& CEO

Vice
Director
Vice President, Vice Vice
of Safety
President, Strategic President, President,
and
Operations Human Finance Marketing
Health
Resources

Training & Compensation Staffing (Line Managers, use of

Development (Shared Service Applicant Tracking Systems)
(Outsourced) Centers)

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 Managing Human Capital in a
Borderless World
Throughout this text, cultural differences
among countries will be identified as a major
factor influencing global business.
Borderless world adds dramatically to the
difficulty of managing human capital.
A country’s culture is the set of values,
symbols, beliefs, languages, and norms that
guide human behavior within the country.
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