chapter 16 strategically managing the hrm function copyright © 2015 mcgraw-hill education. all...
TRANSCRIPT
Chapter 16
Strategically Managing
the HRM Function
Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
Learning Objectives1. Discuss HRM roles and categories of HRM activities.
2. Discuss how HRM function can define its mission and market.
3. Explain approaches to evaluating the effectiveness of HRM practices.
4. Describe new structures for HRM function.
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Learning Objectives, continued
5. Describe how outsourcing HRM activities can improve service delivery efficiency and effectiveness.
6. Relate how process reengineering is used to review and redesign HR practices.
7. Discuss new technologies that can improve HR efficiency and effectiveness.
8. List competencies HRM executives need to become a strategic partner in the company.
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Introduction
HRM practices can help companies gain a competitive advantage.
Virtually every HR function in top companies is going through a transformation process to play a new strategic role while fulfilling its other roles.
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Categories of HRM Activities
Categories of HRM Activities
Transformational Knowledge Management
Cultural ChangeStrategic Redirection &
RenewalManagement Development
TraditionalRecruitment and Selection
TrainingPerformance Management
CompensationEmployee Relations
TransactionalBenefits Administration
Record KeepingEmployee Services
Figure 16.1
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Strategic Management of HRM
For HR to become truly strategic in its orientation, it must view itself as a separate business entity.
Customer orientation is one of the most important changes in HR's attempt to become strategic.
Products of HR must be identified.
Technologies through which HR meets customer needs vary depending on the need being satisfied.
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Customer-Oriented Perspective
Figure 16.2
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Basic Process for HR Strategy
Identifystrategicbusiness
issues
Figure 16.4
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Involving Line Executives
Involving those in charge of running the business can increase quality of information from which HR strategy is created.
Involvement occurs 4 ways:1. Line executives could provide input.2. Line executives could be members of a team that develops HR
strategy.3. Once strategy is developed, line managers could receive
communications with HR strategy information.4. Line managers could formally approve a strategy.
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Characterizing HR StrategiesApproaches to Developing an HR Strategy
HR-Focused
People-Linked
Business LinkedBusiness-Linked
Business-Driven
People issues/outcomes
People issues/outcomes
Business issues/outcomes
People issues/outcomes
Business issues/outcomes
People issues/outcomes
Figure 16.7
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Measuring HRM Effectiveness
Marketing the function – evaluation is a sign that HR cares about the organization as a whole and supports operations, production, marketing and other functions.
Providing accountability – evaluation helps determine whether HRM function is meeting its objectives and effectively using its budget.
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Audit & Analytic ApproachesEvaluating HRM Effectiveness
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Types of Cost–Benefit Analyses
HR Accounting
• capitalization of salary
• net present value of expected wage payments
• returns on human assets and human investments
Utility Analysis
• turnover costs
• absenteeism and sick leave costs
• gains from selection and training programs
• impact of positive employee attitudes
Restructuring to Improve HRM
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Outsourcing
Outsourcing - Contracting with an outside vendor to provide a product or service to the firm.Outsourcing partner can provide the service more
cheaply, efficiently and effectively.Firms primarily outsource transactional activities and
services of HR such as payroll, pension and benefits administration.
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Reengineering is a complete review of critical work processes and redesign to make them more efficient and able to deliver higher quality.
4 Steps of The Reengineering Process :
Identifyprocess
to bereengineered
Reengineering
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When Evaluating A Process, Consider:
1. What is the value of the process?
2. Can employees be given more autonomy?
3. Can jobs be combined?
4. Can decision making and control be built into the process by streamlining it?
5. Are all the steps and tasks in the process necessary?
6. Are data redundancy, unnecessary checks, and controls built into the process?
7. How many special cases and exceptions have to be dealt with?
8. Are the steps in the process arranged in their natural order?
9. Are all of the tasks necessary?
10. What is the desired outcome?
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Improving HRM Effectiveness through New Technologies - E-HRM
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Changes in Delivery
Software Applications for HRM
HRM Effectiveness Through New Technologies–E-HRM – Speed requirements of e-business force HRM managers to leverage technology for delivery of traditional and transformational HRM activities.
Recruitment and Selection - Technology monitors hiring processes achieve compensation goals with less effort.
Compensation and Rewards - Leveraging technology may allow firms to better achieve compensation
Training and Development - Technology allows firms to deliver training and development for some skills or knowledge faster, more efficiently and possibly more effectively.
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The Future for HR Professionals
The future for HRM careers brighter than ever. HR professionals need knowledge of four competencies:
1. business2. change process3. integration competence and4. people’s role in competitive advantage
HR professionals need to understand social and ethical issues, tools, management of change and other processes and HR technologies, policies, programs and practices such as staffing, development, rewards, communication and organizational design
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Seven Roles of Chief HRO
Strategic advisor to the executive teamCounselor/confidante/coach to the executive teamLiaison to the board of directorsTalent architectLeader of the HR functionWorkforce sensorRepresentative of the firm
Table 16.5
Summary
HRM functions have transformed from solely transactional activities to strategic activities.
HRM roles include administrative expert, employee advocate, change agent, and strategic partner to deliver transactional, traditional, and transformational services and activities efficiently and effectively.
HRM must develop measures of the function’s performance through customer surveys and analytical methods to improve performance.
Reengineering and information technology, and outsourcing can improve HRM performance.
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