Human Resource Management

Higher Business Management

Today…

Role and Importance of HRMFunctions of HRMHRM RemitChanging Patterns of EmploymentReasons for Sub-contractingHuman Resource PlanningThe Shamrock OrganisationLabour TurnoverManpower Planning

Role and Importance of Human Resource

Management (HRM)

The most valuable asset in any organisation is its workforce.It is the human resources that generate wealth by providing services and producing goods.Care must be taken over employees especially if they want to secure and retain staff.

Function of Human Resources

HRPRecruitment and SelectionTraining and DevelopmentMaintenance of Personnel RecordsLegislationEmployee RelationsGrievance and Discipline

HRM Remit

To promote a policy of continuous learning and staff developmentTo recruit, develop and retain people with the appropriate skills and attitudes required for present and future jobsTo manage employee relations To design, implement and manage remuneration, reward and appraisal schemesTo maintain and improve physical and mental well being of the workforceTo take account of all legislation relevant to HRM

Changing Patterns of Employment

Decline in full-time, permanent workDecline in heavy engineeringIncrease in service sector employment (call centre, IT)Increase in women working (suited to new areas of employment)

Changing Patterns of Employment

TeleworkingFlexitimePart-timeJob SharingFixed ContractsSub-contracts

Reasons for Sub-Contracting

More skilled workforceExpertiseEconomies of scaleCan concentrate on what you’re good atSaves money in equipment/training

Human Resource Planning

Changing goals of a businessChanges in MarketChanges in Technology

CompetitionPopulation ChangesTrade UnionsGovernment Legislation

Factors affecting HRP:

Labour Turnover

Costs of High Labour Turnover:

Costs of advertising, interviewing & training new employeeLoss of production while place is being filledLow morale amongst other employees

Manpower Planning

If firm’s labour supply > demand:

RedundancyRetrainingEarly retirement‘Natural wastage’

If firm’s labour supply < demand:

• Additional advertising

• Retraining programmes

• Increase pay & other incentives

Recap…

Role and Importance of HRMFunctions of HRMHRM RemitChanging Patterns of EmploymentReasons for Sub-contractingHuman Resource PlanningThe Shamrock OrganisationLabour TurnoverManpower Planning

Today…

Motivation and NeedsMaslowHerzbergFactors of MotivationEmpowerment

Motivation & Needs

Maslow’s Hierarchy of Needs

Needs at top more important than at bottomBut lower needs have to be satisfied first

Herzberg’s Two Factor Theory

Frederick Herzberg believed there were two factors that affected people at work:Hygiene Factors – ones with potential to cause dissatisfaction at work (salary, working conditions, status, over-supervision)Motivator Factors – aspects of a job that can lead to positive job satisfaction (achievement; recognition; meaningful, interesting work; psychological growth and learning)

Factors of Motivationpay levelsjob securitypromotional prospectsResponsibilityworking conditionsfringe benefitsparticipation in decision-makingworking in a team

Motivation

Financial MethodsFlat rate, piece rate, commission. PRP, profit sharing, share ownership

Non-Financial MethodsEmpowerment, delegation, job enrichment, job enlargement, job rotation, quality circles

Empowerment…

…providing the means by which subordinates can exercise power over their working lives.

It offers more responsibility and independence, different from delegation because there is more freedom to decide what to do and how to do it.

Empowerment Benefits to firm

Improved productivityIncreased staff motivationSpeedier decision makingFresh ideas can improve quality of decisions madeOrganisation may become more competitiveFaster communication as there are fewer levels in the organisationImproved management/employee relations

Empowerment benefits to employee

May feel valuedGreater chance of promotionImproved payImproved skillsEmployees may be given extra trainingImproved motivation

Criticisms of Empowerment

Is it more work for less money?

Not all workers like freedom and responsibility. Some like to be told what to do.

Recap…

Motivation and NeedsMaslowHerzbergFactors of MotivationEmpowerment

Today… Recruitment Stages

1. Identify a Job Vacancy2. Conduct a Job Analysis3. Prepare a Job Description4. Prepare a Person Specification5. Advertise the job vacancy

Internally or Externally

Identify Job Vacancy

Could occur due to:

An employee leaving organisationAn employee being promotedA new post being created

Conduct Job Analysis

This identifies:Tasks to be performedSkills neededDuties & responsibilities

Gives idea of ideal candidate

Prepare Job Description

This states:Job titleLocationTasksDuties & ResponsibilitiesHoursHoliday Entitlements

Prepare Person Specification

A description of the type of person suitable for post is drawn up. This includes:QualificationsExperiencePersonal qualitiesHobbies & Interests

Advertising PostInternal and External

Internal

NewslettersNotice board

External

Newspaper AdvertsInternetJob CentreRecruitment AgencySchools/Colleges/ Universities

Internal Recruitment

AdvantagesApplicant & ability familiar to organisationOrganisation may have invested in person through trainingIndividual aware of culture (no need for induction training)

DisadvantagesLimited skills poolOwn Job needed to be filledResentment from overlooked staff

External Recruitment

AdvantagesCan target specific sections of populationWider job skills poolNo need to fill another post

DisadvantagesExpensiveTime taken can be longSuccessful candidates may turn down job

Recap… Recruitment Stages

1. Identify a Job Vacancy2. Conduct a Job Analysis3. Prepare a Job Description4. Prepare a Person Specification5. Advertise the job vacancy

Internally or Externally

Today… Selection Methods

InterviewsApplication FormsCVs and ReferencesTestsAssessment Centres

Interviews

One-to-one interviewSuccessive interviewPanel interview

Application Forms

Initial contact, checked against the Person Specification to select suitable candidates for vacancyUsually in conjunction with CV

CV

Curriculum Vitae or life historyPersonal DetailsEducationQualificationsWork ExperienceHobbies/InterestsAdditional Info

Tests

Attainment testsAptitude testsIQ testsPsychometric testsMedical tests

Assessment Centres

Activities:Team buildingRole PlayInterviews

Qualities looked for:Social skills, leadership qualities & personality

Intensive assessment held over one or two days

Selection Methods:

% used by business

Interviews 92

References74

Assessment

Centres 14

Aptitude Tests 11

Graphology 3

Validity at predicting work performance(0 = no use; 1 = very helpful)

0.17

0.13

0.40

0.54

0.00

Assessment Advantages Disadvantages

Mental Ability tests (IQ)

useful predictors of performance across a wide variety of jobsAre usually easy

and inexpensive to administer

Use of ability tests can result in high levels of adverse impactcan be costly to

develop & administer

Employment interviews

Structured interviews, based on job analyses, tend to be validMay reduce

adverse impact if used in conjunction with other tests

Unstructured interviews typically have poor validitySkill of the

interviewer is critical

Assessment Advantages Disadvantages

Assessment Centres

Good predictors of performance, managerial potential, & leadership abilityApply the whole-person

approach to personnel assessment

Can be expensive to develop & administerSpecialised

training required for assessors;

Reference checks

used to verify information previously provided by applicantsMay encourage

applicants to provide more accurate information

Reports are almost always positive

Recap… Selection Methods

InterviewsApplication FormsCVs and ReferencesTestsAssessment Centres

Today…

Reasons for Training and Development

Training costs and benefits

Induction Training

Training Methods

Reasons for Training and Development

Improve staff performanceImprove productivityStaff more flexibleIncrease job satisfactionStaff more motivatedUpgrade staff skillsReduce injuries & accidents

Training

Costs

Sending people on training costsPaying trainersLoss of output

Benefits

FlexibilityUpgrade skillsEmployee satisfaction

Induction Training

For new employees

Covers aspects of:Company proceduresMeeting colleaguesTasks of jobHealth & safety

Training Methods

On the job – training conducted at employee’s place of work

Off the job – training occurs outside of work e.g. university or college

Training Methods“Sitting next to Nellie” – task demonstrated then trainee undertakes task

Coaching – trainee taken through step by step by trainer

Job Rotation – trainee learns tasks in different departments/jobs

Self-paced/distance learning – trainee receives resources and works on their own

Recap…

Reasons for Training and Development

Training costs and benefits

Induction Training

Training Methods

Today…

Staff DevelopmentAppraisalReasons for AppraisalKeeping Staff RecordsUse of Records

Staff DevelopmentSet targets and have appraisals

Motivate Staff through:Bonuses and financial rewardsEmployee of MonthTeam building/social events

AppraisalAssessment of staff performanceUses Appraisal form then interview

Job focus = Looks for success in meeting goals and targets Person focus = looks for person’s skills and qualities

Problems:Difficult to measurePersonality clashes

Reasons for Appraisal

To identify future training needsConsider individual’s development needsImprove employee performanceProvide feedback on performanceIdentify promotion hopefuls

Keeping Personnel Records

Keeps personal info on every employee

Includes info on appraisals, training etc…

Conforms to the Data Protection Act

Uses of RecordsKey Fields: Unique identifiers like National Insurance Number (Glasgow City Council uses this)

AttendanceDisciplinePerformanceCommunicating (Correspondence)Selection of staff (promotion, training, teams, specific jobs)

Recap…

Staff DevelopmentAppraisalReasons for AppraisalKeeping Staff RecordsUse of Records

Today…

Employee RelationsTrade UnionsTrade Union AimsCollective BargainingGrievanceDiscipline

Employee Relations

“The formal relationship between employees and employers”

Trade Unions

Organisation representing workers re: pay negotiations, working conditions, dismissal, redundancy

Collective bargaining is the basis of unions, whereby a group of workers stand a better chance to negotiate

Trade Unions are funded by annual subscriptions by its members

Trade Union Aims

To improve pay of its membersImprove working conditionsSupport training & development of membersEnsure members’ interests are considered by employers

Collective Bargaining

Begins with a change in existing contractsEmployers make offer to employee repsReps tell members & counter-claim occursNegotiations beginEventually a compromise is usually reached

Grievance

Grievance is a complaint by employee against employer

Can be taken up by:Industrial tribunalACASTrade Union

Discipline

Discipline procedures are taken against employee by employersEmployees must be aware of rulesverbal & written warnings given for breaking rulesSuspensions can follow then dismissal

Recap…

Employee RelationsTrade UnionsTrade Union AimsCollective BargainingGrievanceDiscipline

Today…

ACASNegotiationConsultationArbitrationWorks CouncilsIndustrial Action

ACAS – Advisory, Conciliation & Arbitration Service

Provides impartial information to people with problems at workPrevents & resolves problems at workSettles complaints about employee’s rightsRun workshops & seminars on latest employment issues & legislation

Processes

Negotiation

Consultation

Arbitration

Negotiation

Its purpose is to reach an agreement, but needs some middle ground between the two positions held.Success of the firm should benefit both employee as employers, so it is in their best interests to come to a settlement.Employers and employees discuss matters that are important to both of them in order to come to an agreement. It also involves compromise.

Consultation

Informing employees of new rules and regulations that are being brought in is consultation.The changes may have been forced upon the firm by the Government, therefore no agreement is necessary and employees views are not needed to be taken into account.Final decision lies with the organisation.

Arbitration

When no agreement occurs, then a third party, an independent arbitrator such as ACAS is called in.Arbitrators are neutral and unbiased and will listen to both sides and offer a fair and practical solution.Binding arbitration is when both sides agree to go with the decision of the third party.

Works’ Councils

They are set up by an organisation and contains the same amount of employees and employer representativesGroups meet to discuss any proposed changes before they are implemented.Decisions reached by the council are usually accepted by the workforce as their representatives have been involved.

Industrial ActionEmployee Action

Sit inOvertime banWork to ruleGo slowStrike

Employer Action

Withdrawal of overtimeLock outClosure

Recap…

ACASNegotiationConsultationArbitrationWorks CouncilsIndustrial Action

Today… Legislation

Sex Discrimination Act 1975Race Relations Act 1976Employment Rights Act 1996Equal Pay Act 1970Office, Shops and Railway Premises Act 1963Health and Safety at Work Act 1974

Sex Discrimination Act (1975)

Illegal to discriminate against employee or job applicant on grounds of gender or marital status

Race Relations Act (1976)

Illegal for employers to discriminate against employee or job applicant on grounds of ethnic background

Employment Rights Act (1996)

Covers:

Unfair dismissal

Redundancy

Maternity leave

Equal Pay Act (1970)

Pay conditions must be equal for employees of the opposite sex who are performing same work

Health & Safety at Work Act (1974)

Covers:

Working conditionsProvision of safety equipmentWorkplace hygiene

Office, Shops and Railway Act

Covers:Operating dangerous machinerySeating & Storage spaceLightingFireTemperature/ventilationPremises, Toilets etc…

Not all workers like freedom and responsibility. Some like to be told what to do.

What are the main objectives of HRM?

Describe Maslow’s hierarchy of needs and describe how they are

satisfied through employment

Describe 3 strategies that could be employed to

increase employee motivation

Describe how the structure of the workforce

has changed in recent years

Describe the growing importance of women at

work, and identify the issues that HRM are

having to face

What problems have been presented to firms who have reduced their core

workforce?

Describe the importance of good Human Resource

Planning

Describe the 5 main roles that the HRM department

plays within the organisation

Identify the first 3 stages in the recruitment process

Describe the advantages and disadvantages for

both internal and external recruitment

Explain what procedures are involved in the selection process

Identify and describe the different methods of

training available to the organisation

Describe the benefits of a staff development policy

Identify the main institutions involved in

employee relations

Describe the stages in the employee relations

process

Identify two methods for the successful

management of employee relations

What should a contract of employment include?

What information should be contained in personnel

records?

Identify the major pieces of legislation of concern to

HRM departments