STRATEGIC

BUSINESS
ANALYSIS
Malayan College of Mindanao
REFERENCE
 CHAPTER 1
LESSON 2
HUMAN RESOURCE MANAGEMENT BASICS
Lesson Outcomes:

o Demonstrate an understanding of key terms, theories and concepts in the area of human
resource management (HRM)
o Demonstrate competence in the use of HRM practices in business analysis

o Provide innovative business strategies to problems in the fields of HRM.

HUMAN RESOURCE MANAGEMENT

 Human resources management involves the monitoring of the culture of the organization and is
responsible for the recruitment of appropriate workforce, in the recommendation of market-based
compensation and benefits that are in accordance with the company’s current and potential resources
and in the crafting of an overall strategic employee development plan.
 It is also the management function that conducts research and makes policies and recommendations
covers five functional areas: organizational design; staffing; rewards; benefits and compensation system;
training and development; and performance management and appraisal system.
 Organizational design is about ensuring that there is an employee-job fit for all the positions in an
organizations to fulfill its mission. This is done through the corollary functions of planning and job
analysis.
 Staffing deals with the recruitment of individuals whose skills, abilities, knowledge and experiences are
deemed appropriate for the jobs in the organization that needs to be filled. Corollary functions to
staffing are recruitment and selection.
HUMAN RESOURCE MANAGEMENT

 Then there is the design of rewards, benefits and compensation system that includes compliance,
rewards based on job evaluation, and direct and indirect employee benefits and compensation. Its
compliance component includes the legal aspects of human resource management.

 Employee and organizational training and development seek to ensure that employees have the
necessary knowledge and skills that will allow them to satisfactorily perform their jobs and steer the
company toward its advancement in its sector.

 Performance management and appraisal uses performance evaluation tools developed and adopted by
the organization to help identify interventions to enhance work efficiency. This lesson will help students
better understand the role of human resources and their vital functions in business operations.
LESSON OBJECTIVES

 After this lesson, students are expected to:

o Present the value that human resources management play in the general business analysis and
strategy formulation;
o Demonstrate an understanding of the traditional functions of human resource management;
o Integrate the major activities associated with human resource management;
o Review the proper steps for strategic planning in human resources; and
o Reflect in their thinking process on business analysis the valuable areas of visioning and valuing,
environmental analysis, internal analysis strategy formulation, strategy implementation and evaluation
and assessment.


HUMAN RESOURCE MANAGEMENT

 The dynamic demands and expectations of consumers in both public and private entities, profit and not-
for-profit organizations across the globe necessitate the finding of more valuable in creating strategically
designed human resource units.
 A critical and careful assessment of how a company operates to best align with its overall mission and
goals results in a more positive outcomes for people, systems, as well as technology in the context of
human resource management.
 At the core of human resource management is the attraction, placing, rewarding, training, and retention
of the right people according to the objectives of the organization.
 A job analysis outlines the human resource management plan. Job analysis is the process of collecting
and studying various factors that are related to the operation and responsibilities of a specific job. Its
immediate products are job description and job specification.
JOB DESCRIPTION; JOB SPECIFICATION; JOB ANALYSIS

 Job description contains the job title, location, summary of duties, machines, tools, equipment needed
to perform the job, including the supervision that is expected to be given or received, as well as working
conditions and possible risks.

 Job specification, on the other hand, contains the statement of manpower qualification for a specific
job. This includes the required minimum education, experience, training, judgment, initiative, physical
effort, skills, responsibilities, communication level and emotional and social characteristics.

 Job analysis is required in human resource planning, recruitment and selection, training and
development, job evaluation and performance appraisal, the creation of a compensation and rewards
system, and the establishment of health and safety policies.
DESIGNING ORGANIZATIONAL STRUCTURES
 Designing organizational structures also considers efficient work progress and dynamics. This being
said, due considerations is given not only to the daily processes but more so to the organization’s
priority areas that are more often accomplished over a longer period.

 Understanding the efficiency of all systems and programs marks the beginning of the analysis on how to
improve better results and outcomes.

 Additionally, human resource management emphasizes accountability in the design of structures and
systems that involves people and resources.

 As such, a level of independence and clear standards must be established at the onset, to ensure that
processes will run smoothly and with the least disturbance or delays.
PROCESS OF HUMAN RESOURCE MANAGEMENT: ORGANIZING;
DIRECTING; CONTROLLING
 Ensuring the efficient function of planning, organizing, directing and controlling are within the context of
designing the organizational structures.

 Planning pertains to formulating strategies of personnel programs ahead of use and will contribute to
overall organizational goals.

 On the other hand, organizing is an essential process of allocation of task amongst members of a
specific structure, with identified relationships, responsibilities and accountabilities within an integrated
activity toward the achievement of a common goal.

 Meanwhile, directing is a function that allows for the activation of people at various levels of skills and
tasks, and ensures that each one is able to maximize his or her contribution to organizational goals.
Given appropriate motivation and reward, directing employees at different levels becomes possible even
with the slightest exercise of authority.

 Controlling comes after planning, organizing and directing and necessitates the review of the employees
actual performance. It also includes verifying deviations and comparing results from identified plans and
offering corrective actions for improvement.
PROCESS OF HUMAN RESOURCE MANAGEMENT
 Business experts suggest that to be able to predict organizational successes is to ensure that the right
people are placed in the right position in the company’s functional process.

 The continuous development and evaluation of existing organizational structure play a key role in the
initial design, and subsequent re-design of company structures and groupings.

 This process of structural assessment and re-design involves the referencing of existing employees and
carefully examining if they perform roles that are based on their ability and expertise.

 Every employee has the strength and skill set that ca be useful for leading a company or organization to
a level of success. Most often, these strengths, when left unrecognized, may cause disillusionment and
in some cases shifting roles.

 It may also lead to re-formatting in the reporting structure of an organization, as every individual is
evaluated for strengths and weaknesses that would maximize potentials and would fit in the
organization’s current goals and larger direction.
PROCESS OF HUMAN RESOURCE MANAGEMENT: STAFFING

 Staffing comes after job analysis and human resource planning. It includes recruitment, selection,
placement and orientation. Recruitment is the process of searching for prospective employees and
providing an encouraging environment for them to pursue their job application in the organization.

 Recruitment may be internal and external to the organization. Internal recruitment can be in any of the
following forms: promotion, transfer, job posting or employee referrals. External recruitment can in a
form of advertisement, through direct recruitment, via employment exchanges, using employment
agencies, networking the professional associations, campus recruitment or even word of mouth
announcements.
PROCESS OF HUMAN RESOURCE MANAGEMENT: SELECTION

 Selection is the process of determining the qualification, knowledge, skills, attitude, experiences and
values of an applicant with the purpose of ascertaining job suitability.
 Selection involves screening of applicants, having applicants take tests or other methods of screening
and shortlisting such as interviews, reference and background verification, medical job candidates
include aptitude test, psychomotor test, job knowledge test, vocational or interest test, personality test
and group discussion participation test, interview types, on the other hand, can be informal, formal,
planned, patterned, nondirective, in-depth, stress, group or panel. It is normal that the applicant’s fit to
the company culture is considered at this point.
PROCESS OF HUMAN RESOURCE MANAGEMENT: PLACEMENT
 Placement is the process of giving the selected candidates the most suitable job in terms of
the organizational requirement and the prospective employees’ qualification after the
formalities of screening. This phase of matching then leads to eventual orientation. Varied
techniques are adopted to ensure employee orientation and to introduce a new hire to his
new work environment, introducing him to people, practices, purposes and policies of the
organization. A good orientation program is critical in improving employee morale in reducing
employee turn over, in curtailing absences, in lessening work accidents and in avoiding
industrial strife.
PLACEMENT TO WORK PERFORMANCE FLOW

Work
Screening Job Matching Orientation
Performance
PLACEMENT TO WORK PERFORMANCE FLOW

 Human resource management is valuable to the organization as it helps attract and retain the right
people. Valuable to human resource management efficiency is having a good reward, benefits and
compensation system.

 This process involves wage and salary administration, providing incentive and fringe benefits schemes,
as well as social security insurance and creation of retirement funds. While compensation is a direct
reward for the work done, benefits emanate from a defined company incentive program. Benefits as are
indirect payments for working beyond what a job requires.

 As one motivational tool, rewards, benefits and incentives may be financial or nonfinancial in nature.
Employers are encouraged to exercise their creativity in developing other types of rewards and benefits,
beyond what is government mandated.

 Corporate discount, office perks, child care facilities, wellness programs and education fees
reimbursement were added to the usual disability and health insurance, stock options, profit sharing,
paid parental leaves and performance bonus.
TRAINING AND DEVELOPMENT

 Training and development are the process of creating avenues for employee improvement, reskilling
and up-skilling for managerial development, career planning, and transfer or promotion.

 Training is the imparting of technical and operational skills that are needed for the current job.
Meanwhile, development is the process of conducting suitable programs to improve one’s human and
managerial capability to handle a more expansive role in the organization.

 Provisions for training and development of employees should be embedded in corporate policies as a
way of cementing information on how the company puts a premium on professional development.

 In a similar note, policies on training and development provide the needed direction for the creation of
employee development plans as well as performance improvement mechanisms.

 Training and development differ in periods, focus, orientation, motivation, objectives, number of
beneficiaries, and purpose.
TRAINING AND DEVELOPMENT

 Having the right organizational climate is an emphasis in the task of human resource management, a
climate that celebrates and rewards the advancement of people in their education, exposure and
training because these steps ultimately contribute to a happier work force and training because and a
more efficient organization.

 Training and development exercises make for effective human resource management as they solidify
teamwork and promote team spirit among organizational members.

 In the same way, training and development programs provide excellent growth opportunities for people
who have big potential to move up in the organizational ladder through diligence and commitment.

 Ultimately, having a good training and development program improves organizational productivity,
affects society and economy, reduces costs, maximizes scarce resources and improves profits and overall
work conditions of people.
PERFORMANCE MANAGEMENT AND APPRAISAL

 Performance management and appraisal defines the direction and movement of the careers of people
in the organization. This systematic assessment of an individual’s job performance and their potential for
advancement results in further training, coaching or correction as needed. The results of performance
appraisal may be promotion, transfer or retention. An extreme case would be demotion or separation,
other than retirement or resignation. Performance management and appraisal include setting
performance standards, communicating these standards to the employees, measuring the performance
and comparing this as to what is identified as standard, providing a venue for the discussion of results as
feedback, provision of corrective action as necessary and implementation and regular review. Methods
for performance appraisal vary from the traditional checklist type that is based on job analysis, to
conducting confidential reports, defining critical incidents, ranking, paired comparison, narrative, graphic
rating, grading, forced distribution, testing work sample, nominations or a combination of types.
PERFORMANCE MANAGEMENT AND APPRAISAL

 Human resource management of late has included new ideas such as artificial intelligence, big date,
hybrid work models, healthy organizations instead of mere employee wellbeing, diversity, equity and
inclusion, the onboarding of people with power skills, reskilling as much as up-skilling, gig economy
concept, and cyber security. As technology continues in its essential role in many organizational
functions, the capability of a workforce to integrate and incorporate new and emerging technologies in
the performance of work will prove valuable.

 A successful organizational design is one that maximizes profits, reduces costs, increases employee and
consumer satisfaction, and provides workflow efficiency. After the evaluation, analysis, and
development of every area in an organization, a completed structure should be implemented using the
new policies that were identified in the process. Working through an enterprise’s structure, usually from
the bottom up, will result in identifying problem areas that are ripe for improvement, make appropriate
recommendations, and craft implementation steps within the organizational design.
END