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© 2003 Prentice Hall, Inc.1-1
Human Resource Management
Chapter 1: Introduction to Human Resource Management
Ass. Prof. Ipek Kalemci TUZUN
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© 2003 Prentice Hall, Inc.1-2
Personnel Management Approach Human Resource
Management Approach
Manpower centered
Pragmatic
Job oriented
Resource centered
Strategic
Staff oriented
•Employee-organization relations by HRM approach
•HRM is a term for what historically was referred as personnel administration or personnel management. In today’s arena, HR managers are sometimes called “people managers” and employees are refereed as “our associates”.
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The Management Process
Planning Organizing Staffing Leading Controlling
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The evolution of HRM
Decade Major Business Ideas Common
HR titles
Pre-1900’s Small business and worker’s guilds
No “HR” people
1900’s Large-scale enterprise growth
Labor relations, personnel
1920’s Depression, first labor legislation
Industrial relations, personnel
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Decade Major Business Ideas Common
HR titles
1940’s WW II, growth of large diversified enterprises
Personnel administration
1960’s Civil rights and compliance Personnel
1980’s Growing impact of globalization and technology; human capital; emergency of the knowledge/service economy
Personnel, Human Resources
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Decade Major Business Ideas Common
HR titles
2000’s Modern organizations, organization effectiveness, strategic HR planning
Human Resource Management
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Management Process
Planning Goals and standards Rules and procedures Plans and forecasting.
Organizing Tasks Departments Delegating Authority and communication Coordinating
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Management Process
Staffing Hiring Recruiting Selecting Performance standards Compensation Evaluating performance Counseling Training and developing
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Management Process
Leading Getting the job done Morale Motivation
Controlling Setting standards Comparing actual performance to standards Corrective action
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Human Resource Management
Human Resource Management is the process of acquiring, training, appraising, and compensating employees and attending to their labor relations, health and safety, and fairness concerns.
Human Resource Management can be defined as the implementation of the strategies, plans and programs required to attract, motivate, develop, reward and retain the best people to meet the organizational goals and operational objectives of the organization.
Def
initi
on
Def
initi
on
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HRM Functions Include:
Conducting job analyses (determining the nature of each employee’s job)
Planning labor needs and recruiting job candidates
Selecting job candidates Orienting and training new
employees Managing wages and salaries
(compensating employees) Providing incentives and
benefits Appraising performance
Communicating (interviewing, counseling, disciplining)
Training and developing managers
Building employee commitment Building loyalty
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© 2003 Prentice Hall, Inc.1-12
HHRM is Important to all Managers.
The wrong person, High turnover(**)
**(turnover rate; number of replacement * 100
average number of employee
Low effectiveness and efficiencies
Useless interviews Poor training Unfair labor practices
** In order to decrease turnover rate; Better advancement
opportunities More training Flexible schedules İmproved benefits Greater employee
involvement in operations Recognition programs Good communication of
rules and regulations Resolving employee
complaints
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So,
Human Resources are the people in the organization
Human Resource Management is a series of activities and decisions carried out by all line managers that help employees get the job done and achieve their objectives
Human Resource Department consist of specially trained professionals who help managers carry out human resource management responsinsibilities
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Line and Staff Aspects of HRM
Authority is the right to make decisions, to direct the work of others, and to give orders
Line Managers are authorized to direct the work of subordinates. They are always someone’s boss. In general they are in charge of accomplishing of the group’s goals
Staff Managers are authorized to assist and advise line managers
in their goals. They aid line managers in areas like recruiting, hiring and compensation
Defini
tion
Defini
tion
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Line Manager’s HRM Jobs
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 company’s 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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FIGURE 1–3 Employment and Recruiting—Who Handles It? (Percentage of All Employers)
Source: HR MAGAZINE, BNA/Society for Human Resource Management, 2002. Reproduced with permission via Copyright Clearance Center.
Note: Length of bars represents prevalence of activity among all surveyed employers.
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As a company grows, line managers need the assistance as
well as the specialized knowledge and advice of a
separate HR staff
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HRM DEPARTMENT
Line authority The authority exerted by a personnel manager by directing the activities of the people in his or her own department and in service areas (like the plant cafeteria).
Implied authorityThe authority exerted by a personnel manager by virtue of others’ knowledge that he or
she has access to top management (in areas like testing and affirmative action).
Functional controlThe authority exerted by an HR manager as coordinator of personnel activities.
Employee advocacyHR must take responsibility for clearly defining how management should be treating employees, make sure
employees have the mechanisms required to contest unfair practices, and represent the interests of
employees within the framework of its primary obligation to senior management.
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Human Resource Managers’ Duties
Functions ofHR Managers
Line FunctionLine Authority
Implied Authority
Staff FunctionsStaff Authority
InnovatorEmployee Advocacy
Coordinative Function
Functional Authority
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Human Resource Specialties
Recruiters
EEO Coordinators
Labor Relations Specialists
Training Specialists
Job Analysts
Compensation Managers
Human Resource
Specialties
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© 2003 Prentice Hall, Inc.1-21
Typical HR Positions
Recruiters; maintain contact with community and search for qualified job applicants.
Job analysts; Collect and examine information about jobs to prepare job descriptions and job specifications
Compensation managers; Develop compensation plans and handle the employee benefits program.
Training specialists; Plan, organize, and direct training activities.
Labor relations specialists. Advise management on all aspects of union–management relations.
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FIGURE 1–1 HR Organization Chart for a Large Organization
Source: www.hr.wayne.edu/orgcharts.php. Accessed May 6, 2007.
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FIGURE 1–2 HR Organizational Chart (Small Company)
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The changing role of HR
Effective HRM selection, training, pay and employee fairness practices are crucial to capitalizing on technology and remaining competitive
HR departments must move away from a housekeeping focus to strategic maneuvering – HRM must evolve to remain dynamic
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The new HR manager
Provides efficient operational services including outsourcing service when necessary
Supports top management’s strategic planning efforts
Acts as the company’s “internal consultant” for identifying and institutionalizing changes that enhance employees skills allowing them to contribute to the company’s success
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The Changing Environment of Human Resource Management
Globalization Trends
Technological Trends
Trends in the Nature of Work,
Human Capital
Workforce Demographic Trends
Changes and Trends in Human Resource
Management
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The Changing Environment of Human Resource Management Globalization; tendency of firms to extend their sales and
manufacturing to new markets abroad Technological advances; technology has been forcing and
enabling firms to become more competitive (skilled employee, empowerment)
The nature of work; Human capital(knowledge, education, training, skills and expertise of a firm’s worker) provides competitive advantage
The workforce diversity; increased diversity provide challenges for HR management: Older, more multi-ethnic workforce,Nontraditional workers,
“Generation Y”,Retirees
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The Changing Role of Human Resource Management
New Responsibilities for HR Managers
Measuring the HRM Team’s Performance
Managing with the HR Scorecard
Process
Creating High- Performance Work
Systems
Strategic Human Resource
Management
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Important HRM issues
Strategic human resource management
HR’s use of technology
Managing ethics
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What is strategic HRM?
A strategy is a company’s plan for matching internal strengths and weakness with external opportunities and threats
Strategic HRM is the formulation and execution of HR policies and practices that produce competent employees with the behaviors needed to achieve the company’s strategic goals
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FIGURE 1–8 Strategy and the Basic Human Resource Management Process
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HR and technology
Self-service
Call centers
Productivity improvement
Outsourcing
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Some Ways HR Managers Use Technology
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Issues related to HR ethics
Workplace safety
Security of employee records
Employee theft
Affirmative action
Comparable work
Employee privacy rights
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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 High-Performance Work System (HPWS)
Generate more job applicants
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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© 2003 Prentice Hall, Inc.1-37
FIGURE 1–5 Five Sample HR MetricsHR Metric* How to Calculate It
Absence rate # of days absent in month× 100
Average # of employees during month × # of workdays
Cost per hire Advertising + agency fees + employee referrals + travel cost ofapplicants and staff + relocation costs + recruiter pay and benefits
Number of hires
HR expense factor
HR expense
Total operating expense
Time to fill Total days elapsed to fill job requisitions
Number hired
Turnover rate Number of separations during month× 100
Average number of employees during month
Sources: Robert Grossman, “Measuring Up,” HR Magazine, January 2000, pp. 29–35; 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. 13–20; 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. 93–105; [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 HR’s 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 Manager’s Proficiencies
New Proficiencies
HR proficiencies
Business proficiencies
Leadership proficiencies
Learning proficiencies