Human Resource Management: Gaining a Competitive

©McGraw-HillEducation.Allrightsreserved.Authorizedonlyforinstructoruseintheclassroom.NoreproductionorfurtherdistributionpermittedwithoutthepriorwrittenconsentofMcGraw-HillEducation.Chapter 1
Human Resource Management:
Gaining a Competitive
Advantage
©McGraw-Hill Education.
Learning Objectives
LO1-1 Discuss the roles and activities of a company’s human resource
management function.
LO1-2 Discuss the implications of the economy, the makeup of the
labor force, and ethics for company sustainability.
LO1-3 Discuss how human resource management affects a company’s
balanced scorecard.
LO1-4 Discuss what companies should do to compete in the global
marketplace.
LO1-5 Identify how social networking, artificial intelligence, and robotics
is influencing human resource management.
LO1-6 Discuss human resource management practices that support
high-performance work systems.
LO1-7 Provide a brief description of human resource management
practices.
©McGraw-Hill Education.
Introduction
Human Resource Management
• plays a role in a company’s survival, effectiveness, and
competitiveness
• refers to the policies, practices, and systems that
influence employees’ behavior, attitudes, and
performance
©McGraw-Hill Education.
Figure 1.1 Human Resource Management
Practices
Jump to long description in
appendix
©McGraw-Hill Education.
What Responsibilities and Roles Do HR
Departments Perform? 1 of 2
HRM is a means to contribute to
• profitability
• quality
• other business goals
LO 1-1
©McGraw-Hill Education.
What Responsibilities and Roles Do HR
Departments Perform? 2 of 2
High-Impact HR functions
• more integrated with the business
• more skilled at attracting and retaining employees
• can adapt quickly
• identify and promote talent from within
• identify what motivates employees
• continuously building talent and skills
Table 1.1
Responsibilities of HR Departments
Analysis and design of work
Recruitment and selection
Training and development
Performance management
Compensation and benefits
Employee relations/Labor relations
Personnel policies
Employee data and information systems
Legal compliance
Support for business strategy
©McGraw-Hill Education.
Figure 1.2 HR as a Business with Three
Product Lines 1 of 3
1. Administrative Services and Transactions
Compensation, hiring, staffing
• Emphasis: Resource efficiency and service quality
©McGraw-Hill Education.
Figure 1.2 HR as a Business with Three
Product Lines 2 of 3
2. Business Partner Services
Developing effective HR systems and helping
implement business plans, talent management.
• Emphasis: Knowing the business and exercising
influence – problem solving, designing effective
systems to ensure needed competencies
©McGraw-Hill Education.
Figure 1.2 HR as a Business with Three
Product Lines 3 of 3
3. Strategic Partner
Contributing to the business strategy based on
considerations of human capital, business capabilities,
readiness, and developing HR practices as strategic
differentiators
• Emphasis: Knowledge of HR and of the business,
competition, the market, and business strategies
©McGraw-Hill Education.
Strategic Role of the HRM Function 1 of 12
HRM Role
Time spent on administrative tasks is decreasing, roles
as a strategic business partner, change agent and
employee advocate are increasing.
Shared service model
• Includes centers of expertise or excellence, service centers,
and business partners
• Central place for administrative and transactional tasks
©McGraw-Hill Education.
Strategic Role of the HRM Function 2 of 12
Technology
Reducing HRM role in administrative tasks, maintaining
records, and providing self-service to employees
• Shift to self-service gives employees access to many
HR issues
• HR managers have more time to work on employee
issues
©McGraw-Hill Education.
Strategic Role of the HRM Function 3 of 12
Outsourcing
Most commonly outsourced activities
• Benefits administration (e.g., flexible spending accounts,
health plan eligibility status)
• Relocation
• Payroll
Most common reason for outsourcing
• Cost savings
• Increased ability to recruit and manage talent
• Improved HR service quality
• Protection of the company from potential lawsuits by
standardizing processes such as selection and recruitment
©McGraw-Hill Education.
Strategic Role of the HRM Function 4 of 12
Strategic Role
• Lead efforts focused on talent management and
performance management
• Take the lead in helping companies attract, develop,
and retain talent in order to create global workforces
• Use and analyze data to make a business case for
ideas and problem solutions
©McGraw-Hill Education.
Table 1.2 Questions to Ask: Is HRM Playing
a Strategic Role in the Business?
1. What is HR doing to provide value-added services to internal
clients?
2. Do the actions of HR support and align with business priorities?
3. How are you measuring the effectiveness of HR?
4. How can we reinvest in employees?
5. What HRM strategy will we use to get business from point A to B?
6. From an HR perspective, what should we be doing to improve our
marketplace position?
7. What’s the best change we can make to prepare for the future?
8. Do we react to business problems or anticipate them in advance?
©McGraw-Hill Education.
Strategic Role of the HRM Function 5 of 12
Demonstrating the Strategic Value of HRM: HR
Analytics and Evidenced-Based HR
• HR can engage in evidence-based HR
• Requires the use of HR or Workforce Analytics
• Big data
• Information merged from HR databases, corporate financial
statements, employee surveys, and other data sources
• Result in evidence-based HR decisions
• Show that HR practices influence the organization’s bottom
line, including profits and costs
©McGraw-Hill Education.
Strategic Role of the HRM Function 6 of 12
The HRM Profession: Positions and Jobs
• Primary activities involve performing the HR
generalist role
• Fewer HR professionals are involved in the HR
function at the executive level of the company,
training and development, HR consulting, and
administrative activities
©McGraw-Hill Education.
Table 1.3 Median Salaries for HRM Positions
POSITION SALARY
Top HR executive $240,206
Global HR manager 121,095
Management development manager 117,114
Health and safety manager 101,872
Employee benefits manager 95,244
HR manager 95,267
Mid-level labor relations specialist 83,974
Campus recruiter 64,725
Entry-level HRIS specialist 54,233
HR generalist 51,180
Entry-level compensation analyst 56,267
Entry-level employee training specialist 48,286
SOURCE: Based on data from Salary Wizard, http://swz.salary.com, accessed February 23, 2017.
©McGraw-Hill Education.
Strategic Role of the HRM Function 7 of 12
Education and Experience
Four-year college or graduate HR degree
Senior HR role
• Developing and supporting the company culture,
• Employee recruitment, retention and engagement
• Succession planning
• Designing the company’s overall HR strategy
©McGraw-Hill Education.
Strategic Role of the HRM Function 8 of 12
Education and Experience continued
• Junior HR role
• Handle transactions related to paperwork, benefits and
payroll administration
• Answering employee questions
• Data management
• Professional certification
©McGraw-Hill Education.
Strategic Role of the HRM Function 9 of 12
Competencies and Behaviors
Most HRM professionals are generalists
Lack business acumen
Need nine competencies developed by SHRM
©McGraw-Hill Education.
Strategic Role of the HRM Function 10 of 12
Nine Competencies
1. HR Technical Expertise and Practice
Apply the principles of HRM to contribute to the success of the
business
2. Business Acumen
Understand business functions and metrics within the
organization and industry
3. Critical Evaluation
Interpret information to determine return on investment and
organizational impact in making recommendations and
business decisions
©McGraw-Hill Education.
Strategic Role of the HRM Function 11 of 12
Nine Competencies continued
4. Ethical Practice
Integrate core values, integrity, and accountability throughout all
organizational and business practices
5. Global and Cultural Effectiveness
Manage HR both within and across boundaries
6. Communications
Effectively exchange and create a free flow of information with
and among various stakeholders at all levels of the organization
to produce meaningful outcomes
©McGraw-Hill Education.
Strategic Role of the HRM Function 12 of 12
Nine Competencies continued
7. Organizational Leadership and Navigation
Direct initiatives and processes within the organization and gain
buy-in from stakeholders
8. Consultation
Provide guidance to stakeholders such as employees and
leaders seeking expert advice on a variety of circumstances
and situations
9. Relationship Management
Manage interactions with and between others with the specific
goal of providing service and organizational success
©McGraw-Hill Education.
Figure 1.4
Competitive
Challenges
Influencing U.S.
Companies
Jump to long description in
appendix
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 1 of 25
Competing Through Sustainability
Sustainability relates to social responsibility
Also refers to the company’s ability to meet its needs
without sacrificing the ability of future generations to
meet their needs
• Company must meet the needs of stakeholders
LO 1-2
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 2 of 25
Sustainability includes the ability to
Deal with economic and social changes
Practice environmental responsibility
Engage in responsible and ethical business practices
Provide high-quality products and services
Put in place methods to determine if the company is
meeting stakeholders’ needs
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 3 of 25
Deal with the Workforce and Employment
Implications of the Economy
• Skill demands for jobs have changed
• Remaining competitive in a global economy requires
demanding work hours and changes in traditional
employment patterns
• The economy is not growing although unemployment
rate is below 5%
• Wage growth has been uneven
• Labor productivity fell in 2009
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 4 of 25
HR practices that enhance labor productivity
Improving the design of work and the use of technology
Upskilling employees through training
Managing performance and compensation to incentivize
and motivate workers to work smarter and harder
Raising pay and focus on learning
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 5 of 25
Labor Force and Employment Characteristics
• Population is the most important factor in determining
the size and composition of the labor force
• Growth is slowing
• Labor force is aging
• Diversity is increasing
• Service sector is growing
• Education is important to meet job requirements
• Shortage of qualified candidates
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 6 of 25
Understand and Enhance the Value Placed on
Intangible Assets and Human Capital
Three types of assets
• Financial assets (cash and securities)
• Physical assets (property, plant, equipment)
• Intangible assets
©McGraw-Hill Education.
Table 1.6 Examples of Intangible Assets 1 of 2
Human capital
• Tacit knowledge
• Education
• Work-related know-how
• Work-related competence
Customer capital
• Customer relationships
• Brands
• Customer loyalty
• Distribution channels
©McGraw-Hill Education.
Table 1.6 Examples of Intangible Assets 2 of 2
Social capital
• Corporate culture
• Management
philosophy
• Management
practices
• Informal networking
systems
• Coaching/mentoring
relationships
Intellectual capital
• Patents
• Copyrights
• Trade secrets
• Intellectual property
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 7 of 25
Understand and Enhance the Value Placed on
Intangible Assets and Human Capital continued
Knowledge workers
• Contribute specialized knowledge
• Share knowledge and collaborate on solutions
• In demand because companies need their skills and jobs
requiring them are growing
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 8 of 25
Emphasize Empowerment and Continuous
Learning
Give employees responsibility and authority
Hold them accountable
Employees share in the rewards and losses
Learning organization
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 9 of 25
Adapt to Change
• Inevitable
• Employees expected to take more responsibility for
their own careers
• Challenge is how to build a committed, productive
workforce
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 10 of 25
Maximize Employee Engagement
Passionate about his or her work
Committed to the company and its mission
Works hard to contribute
Measured with attitude or opinion surveys
Table 1.7 Common Themes of Employee Engagement
1. Pride in employer
2. Satisfaction with employer
3. Satisfaction with the job
4. Opportunity to perform challenging work
5. Recognition and positive feedback
6. Personal support from manager
7. Effort above and beyond the minimum
8. Understand link between one’s job and company’s
mission
9. Prospects for future growth with the company
10. Intention to stay with the company
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 11 of 25
Manage Talent
• Acquiring and assessing employees
• Learning and development
• Performance management
• Compensation
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 12 of 25
Consider Nontraditional Employment and the
Gig Economy
• Between 20-35% of the total U.S. workforce
• Workers set their own schedule and do not work for a
company
• Offers flexibility
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 13 of 25
Provide Flexibility to Help Employees Meet Work
and Life Demands
• 46% of employees work more than 45 hours per week
• Only half of employees in the U.S. believe they have
the flexibility they need to successfully manage their
work and personal or family lives
• Solution: flexible work schedules, work-at-home
arrangements, protecting employees’ free time, and
more productively using employees’ work time
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 14 of 25
Meet the Needs of Stakeholders, Shareholders,
Customers, Employees, and Community
Demonstrate performance to stakeholders: the
balanced scorecard
• Being customer-focused
• Improving quality
• Emphasizing teamwork
• Reducing new product and service development times
• Managing for the long term
LO 1-3
©McGraw-Hill Education.
Table 1.8 The Balanced Scorecard
PERSPECTIVE QUESTIONS
ANSWERED
EXAMPLES OF CRITICAL
BUSINESS INDICATORS
CRITICAL HR INDICATORS
Customer How do
customers see
us?
Time, quality, performance,
service, cost
Employee satisfaction with
HR department services;
Employee perceptions of
the company as an
employer
Internal What must we
excel at?
Processes that influence
customer satisfaction,
availability of information on
service, and/or manufacturing
processes
Training costs per
employee, turnover rates,
time to fill open positions
Innovation
and learning
Can we continue
to improve and
create value?
Improve operating efficiency,
launch new products,
continuous improvement,
empowering of workforce,
employee satisfaction
Employee/skills competency
levels, engagement survey
results, change
management capability
Financial How do we look
to shareholders?
Profitability, growth,
shareholder value
Compensation and benefits
per employee, turnover
costs, profit per employee,
revenue per employee
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 15 of 25
Demonstrate Social Responsibility
• Helps boost a company’s image with customers, gain
access to new markets, and help attract and retain
talented employees.
• Companies try to meet shareholder and general
public demands that they be more socially, ethically
and environmentally responsible.
• Helping to protect the planet can also save money.
• Sustainability is an important part of many companies’
business strategy.
Competitive Challenges Influencing Human
Resource Management 16 of 25
Total Quality Management (TQM) 5 Core Values
1. Methods and processes are designed to meet
internal and external customers’ needs.
2. Every employee receives training in quality.
3. Promote cooperation with vendors, suppliers and
customers.
4. Managers measure progress with feedback based on
data.
5. Quality is designed into a product or service so that
errors are prevented rather than being detected and
corrected.
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 17 of 25
Malcolm Baldrige National Quality Award
ISO (International Organization for
Standardization) 9000 Standards
Six Sigma
Lean Thinking & Process Improvement
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 18 of 25
Recognize and capitalize on the demographics
and diversity of the workforce
Internal labor force
External labor market
• Average age of workforce will increase
• Increased workforce diversity
• Immigration will affect size and diversity
• Generational difference with five generations
• Gender and racial composition of the workforce
©McGraw-Hill Education.
Figure 1.5 Comparison of the Age Distribution of
the 2014 and 2024 Labor Forces
Jump to long description in
appendix
SOURCE: Bureau of Labor Statistics, “Employment Projections, 2014–2024,” News Release, www.bls.gov, accessed February 9, 2017.
©McGraw-Hill Education.
Table 1.11 Generations in the Workforce
YEAR BORN GENERATION AGES
1925–45 Traditionalists
Silent Generation
>72
1946–64 Baby Boomers 53-72
1965–80 Generation X 37-52
1981–95 Millennials
Generation Y
Echo Boomers
22-36
1996 Generation Z <21
©McGraw-Hill Education.
Figure 1.6 The U.S. Workforce, 2024
SOURCE: Bureau of Labor Statistics, “Employment Projections, 2014–2024,” News Release, www.bls.gov, accessed February 9, 2017.
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 19 of 25
A Workforce of Mixed Gender, Race and
Nationality
• Diversity of workforce increasing
• Immigration is contributing
• The percentage of highly skilled immigrants now exceeds the
percentage of low-skilled immigrants
• Legal vs. illegal immigration
• Managing a diverse workforce
©McGraw-Hill Education.
Table 1.12 How Managing Cultural Diversity Can
Provide a Competitive Advantage 1 of 2
1. Cost
argument
As organizations become more diverse, the cost of a poor
job in integrating workers will increase. Those who handle
this well will thus create cost advantages over those who
don’t.
2. Employee
attraction and
retention
argument
Companies develop reputations on favorability as
prospective employers for women and ethnic minorities.
Those with the best reputations for managing diversity will
win the competition for talent. As the labor pool shrinks and
changes composition, this edge will become increasingly
important.
3. Marketing
argument
The insight and cultural sensitivity that diverse employees
bring to the marketing effort should help the company enter
new markets and develop products and services for
diverse populations.
©McGraw-Hill Education.
Table 1.12 How Managing Cultural Diversity Can
Provide a Competitive Advantage 2 of 2
4. Creativity
argument
Diversity of perspectives and less emphasis on
conformity to norms of the past improves the level of
creativity.
5. Problemsolving
argument
Heterogeneity in decisions and problem-solving groups
potentially produces better decisions through a wider
range of perspectives and more thorough critical
analysis of issues.
6. System
flexibility
argument
Greater flexibility to react to changes in customer
preferences and tastes (i.e., reactions should be faster
and cost less).
Competitive Challenges Influencing Human
Resource Management 20 of 25
Legal Issues
Employment laws and regulations
Eliminating discrimination and harassment
Health care coverage
Immigration
Data security practices and protecting intellectual
property
©McGraw-Hill Education.
Figure 1.7 Principles of Ethical Companies
Jump to long description in
appendix
Competitive Challenges Influencing Human
Resource Management 21 of 25
Ethical Issues
Sarbanes-Oxley Act of 2002
• Sets strict rules for corporate behavior and sets heavy fines
and prison terms for noncompliance
• Imposes criminal penalties for corporate governing and
accounting lapses including retaliation against whistleblowers reporting violations of Security and Exchange
Commission rules.
Competitive Challenges Influencing Human
Resource Management 22 of 25
Ethical Issues continued
Human resource managers must satisfy three basic
standards for their practices to be considered ethical
• HRM practices must result in the greatest good for the
largest number of people
• Employment practices must respect basic human rights of
privacy, due process, consent, and free speech
• Managers must treat employees and customers equitably
and fairly
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 23 of 25
Competing Through Globalization
U.S. businesses must
• Develop global markets
• Use their practices to improve global competitiveness
• Better prepare employees for global assignments
LO 1-4
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 24 of 25
Competing Through Globalization continued
• Entering International Markets
• Exporting products overseas
• Building manufacturing facilities or service centers in other
countries
• Entering into alliances with foreign companies
• Engaging in e-commerce
• Offshoring and Reshoring
©McGraw-Hill Education.
Competitive Challenges Influencing Human
Resource Management 25 of 25
Competing Through Technology
• Consider applications of social networking, artificial
intelligence, and robotics
• Use HRIS, Mobile devices, cloud computing, and
HR dashboards
• Consider high-performance work systems and virtual
teams
LO 1-5, 1-6
©McGraw-Hill Education.
Figure 1.9 Major Dimensions of HRM Practices
Contributing to Company Competitiveness
©McGraw-Hill Education.
Meeting Competitive Challenges through
HRM Practices
Three challenges
Global
Sustainability
Technology
LO 1-7
©McGraw-Hill Education.
Figure 1.8 Examples of
How HRM Practices
Can Help Companies
Meet Competitive
Challenges
Jump to long description in
appendix
©McGraw-Hill Education.
Appendix of Image Long
Descriptions
©McGraw-Hill Education.
Appendix 1 Figure 1.1 Human Resource
Management Practices
A graphic denotes Strategic HRM Practices of analysis and
design of work, HR planning, recruiting, selection, training
and development, compensation, performance
management and employee relations that all impact
company performance.
Return to original slide
©McGraw-Hill Education.
Appendix 2 Figure 1.4 Competitive Challenges
Influencing U.S. Companies
Competing through sustainability
• Deal with the workforce and employment implications of the economy
• Understand and enhance the value of intangible assets and human capital
• Meet the needs of stakeholders: shareholders, customers, employees, and the
community
• Emphasize customer service and quality
• Recognize and capitalize on the demographics and diversity of the workforce
• Deal with legal and ethical issues
Competing through globalization
• Entering international markets
• Offshoring and reshoring
Competing through technology
• Consider social networking
• Use HRIS, mobile devices, cloud computing, and HR dashboards
• Consider high-performance work systems and virtual teams
All three challenges affect U.S. business competitiveness.
Return to original slide
©McGraw-Hill Education.
Appendix 3 Figure 1.5 Comparison of the Age Distribution of the
2014 and 2024 Labor Forces
The first chart is labeled 2014 and shows 64% of the labor
force is 25-54 years old; 22% is 55 years and older; and
14% is 16 to 24 years old.
The second chart is labeled 2024 and shows 64% of the
workforce is still 25 to 54 years old; but 25% is 55 years
and older; and 11% is 16 to 24 years old.
Return to original slide
©McGraw-Hill Education.
Appendix 4 Figure 1.7 Principles of Ethical
Companies
• Emphasize mutual benefits in customer, vendor, client,
and community relationships
• Employees take responsibility for company actions
• A sense of purpose or vision valued and used by
employees in their work
• Emphasize fairness in treatment of employees,
customers, vendors, and clients
Return to original slide
©McGraw-Hill Education.
Appendix 5 Figure 1.8 Examples of How HRM Practices Can
Help Companies Meet Competitive Challenges
• HRM strategy is matched to business strategy.
• Knowledge is shared.
• Work is performed by teams.
• Pay systems reward skills and accomplishments.
• Selection system is job-related and legal.
• Flexibility in where and when work is performed.
• Employee engagement is monitored.
• Continuous learning environment is created.
• Discipline system is progressive.
• Customer satisfaction and quality are evaluated in the performance management
system.
• Skills and values of a diverse workforce are valued and used.
• Technology is used to reduce the time for administrative tasks and to improve HR
efficiency and effectiveness.
Return to original slide
©McGraw-HillEducation.Allrightsreserved.Authorizedonlyforinstructoruseintheclassroom.NoreproductionorfurtherdistributionpermittedwithoutthepriorwrittenconsentofMcGraw-HillEducation.Chapter 2
Strategic Human Resource
Management
©McGraw-Hill Education.
Learning Objectives
LO 2-1 Describe the differences between strategy formulation
and strategy implementation.
LO 2-2 List the components of the strategic management
process.
LO 2-3 Discuss the role of the HRM function in strategy
formulation.
LO 2-4 Describe the linkages between HRM and strategy
formulation.
LO 2-5 Discuss the more popular typologies of generic
strategies and the various HRM practices associated with
each.
LO 2-6 Describe the different HRM issues and practices
associated with various directional strategies.
©McGraw-Hill Education.
Introduction
Strategic management includes
• Having the goal to deploy and allocate resources for a
competitive advantage
• Integrally involving the HRM function
• Using a business model to create value for customers
©McGraw-Hill Education.
What Is a Business Model?
Accounting Concepts
Fixed Costs
Variable Costs
Margins
Gross Margin
©McGraw-Hill Education.
What Is Strategic Management? 1 of 5
Strategic Management
• A process
• An approach to addressing the competitive
challenges an organization faces
• Managing the “pattern or plan that integrates an
organization’s major goals, policies, and action
sequences into a cohesive whole.”
• Developing strategies for achieving the company’s
goals in light of its current environment
LO 2-1
©McGraw-Hill Education.
What Is Strategic Management? 2 of 5
Strategic HRM
• “The pattern of planned human resource deployments
and activities intended to enable an organization to
achieve its goals.”
• Strategic management is a process to address the
organization’s competitive challenges by integrating
goals, policies and action sequences into a cohesive
whole.
©McGraw-Hill Education.
What Is Strategic Management? 3 of 5
Components of the Strategic Management
Process
• Strategy Formulation
Strategic planning groups decide on strategy
• Strategy Implementation
Organization follows through on the strategy
LO 2-2
©McGraw-Hill Education.
Figure 2.2 A Model of the Strategic Management Process
Jump to long description in
appendix
©McGraw-Hill Education.
What Is Strategic Management? 4 of 5
Linkage Between HRM and the Strategic
Management Process
• Strategic choice
• Where to compete?
• How to compete?
• With what will we compete?
©McGraw-Hill Education.
What Is Strategic Management? 5 of 5
Role of HRM in Strategy Formulation
• With what will we compete?
• Four levels of integration between HRM and the
strategic management function
• administrative linkage
• one-way linkage
• two-way linkage
• integrative linkage
LO 2-3 and 2-4
©McGraw-Hill Education.
Figure 2.4 Linkages of Strategic Planning and
HRM
SOURCE: Adapted from K. Golden and V. Ramanujam, “Between a Dream and a Nightmare: On the Integration of the Human Resource Function and the Strategic Business Planning Process,” Human Resource Management 24 (1985), pp. 429–51.
©McGraw-Hill Education.
Figure 2.5 Strategy Formulation
Adapted from K. Golden and V. Ramanujam, “Between a Dream and a Nightmare,” Human Resource Management 24 (1985), pp. 429–51
©McGraw-Hill Education.
Strategy Formulation
Mission
Goals
External Analysis
Internal Analysis
Strategic Choice
Table 2.2
SWOT
Analysis for
Google, Inc.
STRENGTHS
Expanding Liquidity
Operational Efficiency
Broad Range of Services Portfolio
OPPORTUNITIES
Growing Demand for Online Video
Growth in Internet Advertising Market
Inorganic Growth
WEAKNESSES
Issues with Chinese Government
Dependence on Advertising Segment
Loses at YouTube
THREATS
Weak Economic Outlook
Invalid Clicks
Microsoft-Yahoo! Deal
©McGraw-Hill Education.
Strategy Implementation 1 of 12
Strategic implementation requires that
• “An organization has a variety of structural forms and
organizational processes to choose from when
implementing a given strategy”
• Five variables
• organizational structure
• HRM tasks
•task design
•selection, training, and development of people
•reward systems
• types of information and information systems
LO 2-5
©McGraw-Hill Education.
Figure 2.6 Variables to Be Considered in
Strategy Implementation
Jump to long description in
appendix
©McGraw-Hill Education.
Strategy Implementation 2 of 12
Vertical Alignment
• HR practices and processes address the strategic
needs of the business.
• The link between strategy and HR practices is
primarily through people.
• Job analysis and design
• Recruitment
• Selection systems
• Training and development programs
• Performance management systems
• Reward systems
• Labor relations programs
©McGraw-Hill Education.
Figure 2.7 Strategy Implementation
Jump to long description in
appendix
©McGraw-Hill Education.
Strategy Implementation 3 of 12
HRM Practices
Job Analysis/Design
Recruitment/Selection
Training/Development
Performance Management
Pay Structure/Incentives/Benefits
Labor-Employee Relations
©McGraw-Hill Education.
Strategy Implementation 4 of 12
Pay Structure, Incentives, and Benefits
• High pay and/or benefits relative to competitors can
help company attract and retain high-quality
employees, but might have a negative impact on
overall labor costs.
• Tying pay to performance can elicit specific activities
and levels of performance from employees.
©McGraw-Hill Education.
Strategy Implementation 5 of 12
Labor and Employee Relations
• Employees – asset or expense?
• How much should employees participate in decision
making?
• What rights do employees have?
• What is the company’s responsibility to employees?
• The approach a company takes in making these
decisions can result in successfully achieving its
short and long-term goals or ceasing to exist.
©McGraw-Hill Education.
Strategy Implementation 6 of 12
Strategic Types
• Porter’s Cost and Differentiation
• Value can be created by reducing costs.
• Value can be created by differentiating a product or service
so the company can charge a premium price relative to its
competitors
©McGraw-Hill Education.
Strategy Implementation 7 of 12
HRM Needs in Strategic Types
Role behaviors
• Behaviors required of an individual in his or her role as a job
holder in a social work environment
• Cost strategies – companies define the skills they require
and invest in training employees in these skill areas.
• Differentiation strategies – Employees are expected to exhibit
role behaviors that include cooperating with others,
developing new ideas, and taking a balanced approach to
process and results.
©McGraw-Hill Education.
Strategy Implementation 8 of 12
Directional Strategies
Concentration
Internal Growth
Mergers and Acquisitions
Downsizings
LO 2-6
©McGraw-Hill Education.
Strategy Implementation 9 of 12
Concentration Strategies
• Require that the company maintain the current skills
that exist in the organization
• Need for skill-based training and fair compensation
©McGraw-Hill Education.
Strategy Implementation 10 of 12
Internal Growth Strategies
• Companies must constantly hire, transfer and
promote individuals.
• Compensation weighted towards achievement
• Joint ventures require conflict resolution
©McGraw-Hill Education.
Strategy Implementation 11 of 12
Mergers and Acquisitions
On the increase
HR needs to be involved
• People issues can cause problems
• Different organizational cultures
• Conflict resolution
©McGraw-Hill Education.
Strategy Implementation 12 of 12
Downsizing
• Trend has slowed since 2008
• Tends to fall short of meeting companies’ financial
and organizational objectives, and has negative
effects on employee morale and productivity
• The HRM function must “surgically” reduce the
workforce by cutting only the workers who are less
valuable in their performance
• Early retirement programs usually result in rehiring
• Survivor morale issues
©McGraw-Hill Education.
Figure 2.9 Layoff Events and Separations
2009–2013
Jump to long description in
appendix
SOURCE: U.S. Department of Labor, Bureau of Labor Statistics, “Mass Layoffs Summary,” May 13, 2013, www.bls.gov/news.release/mslo.nr0.htm.
©McGraw-Hill Education.
The Role of Human Resources in Providing
Strategic Competitive Advantage 1 of 2
Emergent Strategies
• Consist of the strategies that evolve from the
grassroots of the organization
• Can be thought of as what organizations actually do,
as opposed to what they intend to do
• Usually identified by those lower in the organizational
hierarchy
Intended Strategies
• The result of the rational decision-making process used by
top managers as they develop a strategic plan.
©McGraw-Hill Education.
The Role of Human Resources in Providing
Strategic Competitive Advantage 2 of 2
Enhancing Firm Competitiveness
• Develop a human capital pool that gives the company
the unique ability to adapt to an ever-changing
environment.
• Learning organization
©McGraw-Hill Education.
Appendix of Image Long
Descriptions
©McGraw-Hill Education.
Appendix 1 Figure 2.2 A Model of the
Strategic Management Process
The process involves strategy formulation, which includes the firm’s
mission, goals, external analysis (opportunities and threats), and
internal analysis (strengths and weaknesses). These lead to strategic
choice and human resource needs (skills, behaviors, and culture).
These, in turn, result in strategy implementation, including HR practices
(recruitment, training, performance management, labor relations,
employee relations, job analysis, job design, selection, development,
pay structure, incentives, and benefits), human resource capability
(skills, abilities, and knowledge), human resource actions (behaviors,
and results – productivity, absenteeism, turnover), and firm
performance (productivity, quality, and profitability). Emergent strategies
can impact each of these areas. The final step is strategy evaluation.
Return to original slide.
©McGraw-Hill Education.
Appendix 2 Figure 2.6 Variables to Be
Considered in Strategy Implementation
A diagram shows HRM has primary responsibility for three
of the five implementation variables: task, people, and
reward systems. In addition, HRM can directly affect the
two remaining variables: structure and information and
decision processes. These variables are affected by
product market strategy and performance.
Return to original slide
©McGraw-Hill Education.
Appendix 3 Figure 2.7 Strategy
Implementation
Strategic choice
Human resource needs, including skills, behaviors, and culture
HRM practices, including recruitment, training, performance
management, labor relations, employee relations, job analysis, job
design, selection, development, pay structure, incentives, and benefits
Human resource capability, including skills, abilities, and knowledge
Human resource actions, including behaviors and results (productivity,
absenteeism, and turnover)
Firm performance, including productivity, quality, and profitability
Return to original slide
©McGraw-Hill Education.
Appendix 4 Figure 2.9 Layoff Events and
Separations 2009–2013
The graph shows a high of 8,000 layoff events and 800,000
separations in the first quarter of 2009, to a low of 3,000
layoff events and 350,000 separations in the third quarter
of 2012.
Return to original slide
©McGraw-HillEducation.Allrightsreserved.Authorizedonlyforinstructoruseintheclassroom.NoreproductionorfurtherdistributionpermittedwithoutthepriorwrittenconsentofMcGraw-HillEducation.Chapter 3
The Legal Environment: Equal
Employment Opportunity and Safety
©McGraw-Hill Education.
Learning Objectives 1 of 2
LO 3-1 Identify the three branches of government and the
role each plays influencing the legal environment of
human resource management.
LO 3-2 List the major federal laws that require equal
employment opportunity and the protections
provided by each of these laws.
LO 3-3 Discuss the roles, responsibilities, and
requirements of the federal agencies responsible
for enforcing equal employment opportunity laws.
LO 3-4 Identify the three theories of discrimination under
Title VII of the Civil Rights Act and apply these
theories to different discrimination situations.
©McGraw-Hill Education.
Learning Objectives 2 of 2
LO 3-5 Identify behavior that constitutes sexual
harassment, and list things that an organization can
do to eliminate or minimize it.
LO 3-6 Discuss the legal issues involved with preferential
treatment programs.
LO 3-7 Identify the major provisions of the Occupational
Safety and Health Act (1970) and the rights of
employees that are guaranteed by this act.
©McGraw-Hill Education.
The Legal System in the United States
Three branches
• Legislative Branch
• House of Representatives
• Senate
• Executive Branch
• President
• Regulatory Agencies
• Judicial Branch
• U.S. District Courts
• U.S. Courts of Appeals
• Supreme Court
LO 3-1
©McGraw-Hill Education.
Equal Employment Opportunity 1 of 7
Equal Employment Opportunity
• Enforced through constitutional amendments,
legislation, executive orders, and court decisions
LO 3-2
©McGraw-Hill Education.
Equal Employment Opportunity 2 of 7
Constitutional Amendments
Thirteenth Amendment
• Abolished slavery
Fourteenth Amendment
• Provides equal protection for all citizens and requires
due process in state action
©McGraw-Hill Education.
Equal Employment Opportunity 3 of 7
Congressional Legislation
• Reconstruction Civil Rights Acts of 1866 and 1871
• Grants all citizens the right to make, perform, modify, and
terminate contracts and enjoy all benefits, terms, and
conditions of the contractual relationship
• Equal Pay Act of 1963
• Requires that men and women performing equal jobs
receive equal pay
©McGraw-Hill Education.
Equal Employment Opportunity 4 of 7
Congressional Legislation continued
• Title VII of the Civil Rights Act of 1964
• Forbids discrimination based on race, color, religion, sex,
or national origin
• Age Discrimination in Employment Act of 1967
• Prohibits discrimination in employment against
individuals 40 years of age and older
©McGraw-Hill Education.
Equal Employment Opportunity 5 of 7
Congressional Legislation continued
• Rehabilitation Act of 1973
• Requires affirmative action in the employment of
individuals with disabilities
• Vietnam Era Veteran’s Readjustment Assistance
Act of 1974
• Requires federal contractors and subcontractors to take
affirmative action toward employing Vietnam veterans
©McGraw-Hill Education.
Figure 3.1 Age Discrimination Complaints, 1991–2014
SOURCE: Equal Employment Opportunity Commission, “Age Discrimination in Employment Act (Charges Filed with EEOC),” https://www.eeoc.gov/eeoc/statistics/enforcement/adea.cfm.
©McGraw-Hill Education.
Equal Employment Opportunity 6 of 7
Congressional Legislation continued
• Pregnancy Discrimination Act
• Prohibits discrimination on the basis of pregnancy,
childbirth, or related medical conditions
• Civil Rights Act of 1991
• Prohibits discrimination (same as Title VII)
• Americans with Disabilities Act of 1990
• Prohibits discrimination against individuals with
disabilities
©McGraw-Hill Education.
Table 3.2 Maximum Punitive Damages
Allowed under the Civil Rights Act of 1991
EMPLOYER SIZE DAMAGE LIMIT
14 to 100 employees $ 50,000
101 to 200 employees $ 50,000
201 to 500 employees $ 200,000
More than 500 employees $ 300,000
©McGraw-Hill Education.
Equal Employment Opportunity 7 of 7
Executive Orders
Executive Order 11246
• Prohibits government contractors and subcontractors from
discrimination based on race, color, religion, sex, and
national origin.
Executive Order 11478
• Requires the federal government to base all its employment
policies on merit and fitness, and specifies that race, color,
sex, religion, and national origin should not be considered.
©McGraw-Hill Education.
Enforcement of Equal Employment
Opportunity 1 of 3
Equal Employment Opportunity Commission
(EEOC)
• Investigation and Resolution
• Lilly Ledbetter Fair Pay Act
• Information Gathering
• Issuance of Guidelines
• Uniform Guidelines on Employee Selection Procedures
LO 3-3
©McGraw-Hill Education.
Enforcement of Equal Employment
Opportunity 2 of 3
Lilly Ledbetter Fair Pay Act
Congress passed the act specifying that an “illegal act”
occurs when
(1) a discriminatory compensation decision is adopted
(2) an employee becomes subject to the decision or
(3) an employee is affected by it application, including each
time compensation is paid
©McGraw-Hill Education.
Enforcement of Equal Employment
Opportunity 3 of 3
Office of Federal Contract Compliance Programs
(OFCCP)
• Utilization analysis
• Goals and timetables
• Action steps
©McGraw-Hill Education.
Types of Discrimination 1 of 6
Disparate Treatment
Disparate Impact
Reasonable Accommodation
LO 3-4
©McGraw-Hill Education.
Table 3.3 Comparison of Discrimination Theories 1 of 2
DISPARATE TREATMENT DISPARATE
IMPACT
REASONABLE
ACCOMMODATION
Show Intent? Yes NO Yes
Show Intent? Individual is a member
of a protected group,
was qualified for the job,
and was turned down
for the job, and the job
remained open
Statistical disparity
in the effects of a
facially neutral
employment
practice
Individual has a
belief or disability,
provided the
employer with notice
(request to
accommodate), and
was adversely
affected by a failure
to be accommodated
Employer’s
defense
Produce a legitimate,
nondiscriminatory
reason for the
employment decision or
show bona fide
occupational
qualification (BFOQ)
Prove that the
employment
practice bears a
manifest
relationship with
job performance
Job-relatedness and
business necessity,
undue hardship, or
direct threat to health
or safety
©McGraw-Hill Education.
Table 3.3 Comparison of Discrimination Theories 2 of 2
DISPARATE TREATMENT DISPARATE IMPACT REASONABLE
ACCOMMODATION
Plaintiff’s
rebuttal
Reason offered was
merely a “pretext” for
discrimination
Alternative
procedures exist
that meet the
employer’s goal
without having
disparate impact
Monetary
damages
Compensatory and
punitive damages
Equitable relief (for
example: back pay)
Compensatory and
punitive damages
(if discrimination
was intentional or
employer failed to
show good-faith
efforts to
accommodate)
©McGraw-Hill Education.
Types of Discrimination 2 of 6
Disparate treatment
• When individuals are treated differently because of
their race, sex, or the like
• The Plaintiff’s Burden
• Prima facie
• The Defendant’s Rebuttal
• Bona fide occupational qualification
• The Plaintiff’s Rebuttal
• Mixed Motive Cases
©McGraw-Hill Education.
Types of Discrimination 3 of 6
Disparate Impact
• Occurs when a neutral employment practice
disproportionately excludes a protected group from
employment opportunities
• The plaintiff’s burden
• Four-fifths rule
• Standard deviation rule
• Wards Cove Packing Co. v. Antonio
©McGraw-Hill Education.
Types of Discrimination 4 of 6
Disparate Impact continued
• Defendant’s Rebuttal
• Must show that the employment practice is a “business
necessity.”
• Plaintiff’s Rebuttal
• Argue that other employment practices could sufficiently
meet the employer’s goal without adverse impact
©McGraw-Hill Education.
Types of Discrimination 5 of 6
Pattern and Practice
Plaintiffs attempt to show three things in class action
pattern and practice lawsuits
• Statistical disparities between composition of some group
within the company compared to some other relevant group
• Individual acts of intentional discrimination that suggest
statistical disparity is a function of the larger culture
• Promotion and/or pay procedures leave too much discretion
to managers, providing the avenue through which
unconscious biases can play a part
©McGraw-Hill Education.
Types of Discrimination 6 of 6
Reasonable Accommodation
Religion and accommodation
• An employee must demonstrate that he or she has a
legitimate religious belief and provided the employer with
notice of the need to accommodate the religious practice,
and that adverse consequences occurred due to the
employer’s failure to accommodate.
Disability and accommodation
• The plaintiff must show that she or he is a qualified applicant
with a disability and that adverse action was taken by a
covered entity
©McGraw-Hill Education.
Retaliation for Participation and Opposition
Title VII
Employers cannot retaliate against employees for either
“opposing” a perceived illegal employment practice or
“participating in a proceeding” related to an alleged
illegal employment practice
Opposition
Expressing to someone through proper channels that
you believe that an illegal employment act has taken
place or is taking place.
Participation
Testifying in an investigation, hearing, or court
proceeding regarding an illegal employment act
©McGraw-Hill Education.
Current Issues Regarding Diversity and
Equal Employment Opportunity 1 of 3
Sexual harassment
• Refers to unwelcome sexual advances
• Charges have been decreasing since 2010
• Hostile working environment
• Filings by men have increased
LO 3-5
©McGraw-Hill Education.
Figure 3.3 Sexual Harassment Charges,
2010–2016
SOURCE: Equal Employment Opportunity Commission, “Charges Alleging Sex-Based Harassment (Charges Files with EEOC),” https://www.eeoc.gov/eeoc/statistics/enforcement/sexual_harassment_new.cfm
©McGraw-Hill Education.
Table 3.4 EEOC Definition of Sexual Harassment
Unwelcome sexual advances, requests for sexual
favors, and other verbal or physical contact of a sexual
nature constitute sexual harassment when
1. Submission to such conduct is made either explicitly or implicitly a
term or condition of an individual’s employment,
2. Submission to or rejection of such conduct by an individual is used
as the basis for employment decisions affecting such individual, or
3. Such conduct has the purpose or effect of unreasonably interfering
with an individual’s work performance or creating an intimidating,
hostile, or offensive working environment.
©McGraw-Hill Education.
Current Issues Regarding Diversity and
Equal Employment Opportunity 2 of 3
Affirmative Action and Reverse Discrimination
• Imposed quota programs
• Ricci v. DeStefano
Outcomes of the Americans with Disabilities Act
• Increased litigation
• Many cases being filed are not based on the rights
that Congress intended to protect
• Does not appear to have had its anticipated impact
on the employment of Americans with disabilities
LO 3-6
©McGraw-Hill Education.
Current Issues Regarding Diversity and
Equal Employment Opportunity 3 of 3
LGBT Issues
• Most businesses are more inclusive.
• The state of employment law has not caught up.
• The Equality Act of 2017
• Unlikely to pass
• The courts have not made a definitive decision
©McGraw-Hill Education.
Employee Safety 1 of 6
The Occupational Safety and Health Act (OSHA)
• Authorizes federal government to establish and
enforce occupational safety and health standards for
all places of employment engaging in interstate
commerce.
• Employee rights under OSHA
• General Duty Clause
LO 3-7
©McGraw-Hill Education.
Table 3.6 Rights Granted to Workers Under
OSHA
Employees have the right to
1. Request an inspection.
2. Have a representative present at an inspection.
3. Have dangerous substances identified.
4. Be promptly informed about exposure to
hazards and be given access to accurate records
regarding exposures.
5. Have employer violations posted at the work
site.
©McGraw-Hill Education.
Employee Safety 2 of 6
The Occupational Safety and Health Act (OSHA)
continued
OSHA inspections
1. The compliance officer reviews the employer’s records of
deaths, injuries, and illnesses.
2. The officer, typically accompanied by a representative of the
employer (and perhaps by a representative of the employees),
conducts a “walkaround” tour of the employer’s premises.
3. Employee interviews may take place during the tour.
4. In a closing conference, the compliance officer discusses the
findings with the employer, noting any violations.
©McGraw-Hill Education.
Employee Safety 3 of 6
The Occupational Safety and Health Act (OSHA)
continued
Citations and penalties
• The compliance officer can issue a citation to the employer
that specifies the exact practice or situation that violates the
act.
• The employer must post the citation.
• Fines may be assessed against the employer.
• Criminal penalties may also be assessed.
©McGraw-Hill Education.
Employee Safety 4 of 6
The Occupational Safety and Health Act (OSHA)
continued
The Effect of OSHA
• Raised level of awareness
• Does not directly regulate employee behavior
©McGraw-Hill Education.
Employee Safety 5 of 6
Safety Awareness Programs
• Identifying and Communicating Job Hazards
• The job hazard analysis technique
• The technic of operations review (TOR)
• Reinforcing Safe Practices
• Safety incentive programs
• Focus on specific injuries or disabilities
©McGraw-Hill Education.
Table 3.8 A 10-Step Program for Reducing EyeRelated Injuries
1. Conduct an eye hazard job analysis.
2. Test all employees’ vision to establish a baseline.
3. Select protective eyewear designed for specific operations.
4. Establish a 100% behavioral compliance program for eyewear.
5. Ensure that eyewear is properly fitted.
6. Train employees in emergency procedures.
7. Conduct ongoing education programs regarding eye care.
8. Continually review accident prevention strategies.
9. Provide management support.
10. Establish written policies detailing sanctions and rewards for
specific results.
SOURCE: From T. W. Turrif, “NSPB Suggests 10-Step Program to Prevent Eye Injury,” Occupational Health and Safety 60 (1991), pp. 62–66. Copyright © Media Inc. Reprinted with permission.
©McGraw-Hill Education.
Employee Safety 6 of 6
Promoting Safety Internationally
Cultural differences
Chapter 4
The Analysis and Design of
Work
©McGraw-HillEducation.Allrightsreserved.Authorizedonlyforinstructoruseintheclassroom.NoreproductionorfurtherdistributionpermittedwithoutthepriorwrittenconsentofMcGraw-HillEducation.
©McGraw-Hill Education
Learning Objectives
LO4-1Analyze an organization’s structure and work-flow
process, identifying the output, activities, and inputs
in the production of a product or service.
LO4-2 Understand the importance of job analysis in
strategic human resource management.
LO4-3 Choose the right job analysis technique for a variety
of human resource activities.
LO4-4 Identify the tasks performed and the skills required
in a given job.
LO4-5 Understand the different approaches to job design.
LO4-6 Comprehend the trade-offs among the various
approaches to designing jobs.
©McGraw-Hill Education
Introduction
No “one best way” to design jobs and structure
organizations.
Organizations need to create a fit between
environment, competitive strategy, philosophy and jobs
and organizational design.
Failing to design effective organizations and jobs has
important implications for competitiveness.
©McGraw-Hill Education
Work-Flow Analysis and Organization Structure 1 of 6
Work-Flow Design
• Important in understanding how to bundle tasks
into discrete jobs
Organization Structure
Need to understand how jobs at different levels relate
LO 4-1
©McGraw-Hill Education
Work-Flow Analysis and Organization Structure 2 of 6
Work-Flow Analysis
• Provides a means for managers to understand all
tasks required to produce a high-quality product and
the skills necessary to perform those tasks
• Analyzing work outputs
• Can be a product or service
©McGraw-Hill Education
Figure 4.1 Developing a Work–Unit Activity Analysis
Jump to long description in appendix
©McGraw-Hill Education
Work-Flow Analysis and Organization Structure 3 of 6
Work-Flow Analysis continued
Analyzing work processes
• How is the output generated (operating procedures)?
• Team-based job design
• Lean production
Analyzing work inputs
• Raw materials, equipment, and human skills
• Just-in-time inventory
• Equipment
©McGraw-Hill Education
Work-Flow Analysis and Organization Structure 4 of 6
Organization Structure
• Dimensions of structure
• Centralization
• Departmentalization
©McGraw-Hill Education
Work-Flow Analysis and Organization Structure 5 of 6
Organization Structure continued
Structural configurations
• Functional structure
• High levels of centralization
• Very efficient with little redundancy
• Divisional structure
• Low levels of centralization
• More flexible and innovative
• Not efficient
©McGraw-Hill Education
Figure 4.2 The Functional Structure
Jump to long description in appendix
SOURCE: Adapted from J. A. Wagner and J. R. Hollenbeck, Organizational Behavior: Securing Competitive Advantage, 3rd ed. (New York: Prentice Hall, 1998).
©McGraw-Hill Education
Figure 4.3 Divisional Structure:
Product Structure
©McGraw-Hill Education
Figure 4.4 Divisional Structure:
Geographic Structure
©McGraw-Hill Education
Figure 4.5 Divisional Structure:
Client Structure
©McGraw-Hill Education
Work-Flow Analysis and Organization Structure 6 of 6
Organization Structure continued
Structure and the nature of jobs
• Jobs in functional structures need to be narrow and highly
specialized.
• Managers of divisional structures often need to be more
experienced or high in cognitive ability relative to
managers of functional structures
©McGraw-Hill Education
Job Analysis 1 of 6
The Importance of Job Analysis
• Work redesign
• Human resource planning
• Selection
• Training and development
• Performance appraisal
• Career planning
• Job evaluation
LO 4-2
©McGraw-Hill Education
Job Analysis 2 of 6
The Importance of Job Analysis to Line Managers
• Must have detailed information about all the
jobs in their work group to understand the workflow process
• Need to understand the job requirements to
make intelligent hiring decisions
• Are responsible for ensuring that each
individual is performing satisfactorily
• Must ensure that the work is being done safely
©McGraw-Hill Education
Job Analysis 3 of 6
Job Analysis Information
Nature of information
• Job descriptions
• Tasks, duties and responsibilities (TDRs)
• Job specifications
• Knowledge, skill, ability, and other characteristics
(KSAOs)
• Not directly observable
©McGraw-Hill Education
Job Analysis 4 of 6
Job Analysis Information continued
Sources of Job Analysis Information
• Subject-matter experts
• Job incumbent
• Supervisors
• Social networks
©McGraw-Hill Education
Job Analysis 5 of 6
Job Analysis Methods
Job analysis is the process of getting detailed
information about a job.
Two recognized methods
• Position Analysis Questionnaire (PAQ)
• The Occupational Information Network (O*NET)
LO 4-3
©McGraw-Hill Education
Job Analysis 6 of 6
Dynamic Elements of Job Analysis
Jobs change and evolve over time
• The job analysis process must also detect changes in the
nature of jobs
Dejobbing
• Viewing organizations as a field of work needing to be
done rather than a set of discrete jobs held by specific
individuals
LO 4-4
©McGraw-Hill Education
Job Design 1 of 5
Mechanistic Approach
• Identify the simplest way to structure work that
maximizes efficiency
• Scientific management
• Workers are trained in the “one best way” to do a
job, then selected on their ability to do the job
• Monetary incentives
LO 4-5
©McGraw-Hill Education
Job Design 2 of 5
Motivational Approach
Focuses on psychological and motivational potential
of a job
Attitudinal variables are important
Job Characteristics Model
• skill variety
• task identity
• autonomy
• feedback
• task significance
©McGraw-Hill Education
Job Design 3 of 5
Biological Approach
• Also called ergonomics
• Examines the interface between individuals’
physiological characteristics and the physical
work environment
• Applied to redesigning equipment for jobs that are
physically demanding
• Provides a climate that values safety and health
©McGraw-Hill Education
Job Design 4 of 5
Perceptual-Motor Approach
• Design jobs that don’t exceed people’s mental
capabilities and limitations
• Based on the least capable worker
©McGraw-Hill Education
Job Design 5 of 5
Technology
• Absence presence results when interacting with
multiple media
• Technology can increase opportunities for errors
• SBAR method
©McGraw-Hill Education
Appendix of Image Long
Descriptions
©McGraw-Hill Education
Appendix 1 Figure 4.1 Developing a WorkUnit Activity Analysis
Raw inputs – What materials, data, and information are
needed?
Equipment – What special equipment, facilities, and
systems are needed?
Human Resources – What knowledge, skills, and abilities
are needed by those performing the tasks?
Activity – What tasks are required in the production of the
output?
Output – What product, information, or service is provided?
How is the output measured?
Return to original slide
©McGraw-Hill Education
Appendix 2 Figure 4.2 The Functional
Structure
The president is at the top, followed by the vice presidents
for each functional area (marketing, engineering, etc.).
Reporting to the vice presidents are subunits, such as
sales and quality assurance. Reporting to the
manufacturing subunits are the plants, with layers of
supervisors and assembly workers.
Return to original slide
Chapter 5
Human Resource Planning
and Recruitment
©McGraw-HillEducation.Allrightsreserved.Authorizedonlyforinstructoruseintheclassroom.NoreproductionorfurtherdistributionpermittedwithoutthepriorwrittenconsentofMcGraw-HillEducation.
©McGraw-Hill Education
Learning Objectives
LO 5-1 Discuss how to align a company’s strategic direction with its
human resource planning.
LO 5-2 Determine the labor demand for workers in various job
categories.
LO 5-3 Discuss the advantages and disadvantages of various ways of
eliminating a labor surplus and avoiding a labor shortage.
LO 5-4 Describe the various recruitment policies that organizations
adopt to make job vacancies more attractive.
LO 5-5 List the various sources from which job applicants can be
drawn, their relative advantages and disadvantages, and the
methods for evaluating them.
LO 5-6 Explain the recruiter’s role in the recruitment process, the limits
the recruiter faces, and the opportunities available.
©McGraw-Hill Education
Introduction
Societal trends and events affect employers
through
• consumer markets
• labor markets
Keys to effectively utilizing labor markets
• clear idea of current configuration of human
resources
• know where the organization is going in the
future, how the present configuration of human
resources relates to the configuration that will be
needed
• address discrepancies
©McGraw-Hill Education
Figure 5.1 Overview of the Human Resource
Planning Process
©McGraw-Hill Education
The Human Resource Planning Process 1 of 13
Forecasting
• Ascertain the supply of and demand for various
types of human resources
• Predict areas within the organization where there
will be future labor shortages or surpluses
• Can use statistical or judgmental methods
LO 5-1
©McGraw-Hill Education
The Human Resource Planning Process 2 of 13
Forecasting continued
Determining labor demand
• Demand forecasts are developed around specific job
categories or skill areas relevant to the organization’s
current and future state
• May use statistical models
• Leading indicator predicts future labor demand
• Useful when there is a long, stable history that can
be used to reliably detect relationships among
variables
LO 5-2
©McGraw-Hill Education
The Human Resource Planning Process 3 of 13
Forecasting continued
Determining labor supply
• Internal labor supply analyzes how many people are
currently in various job categories within the company
• Transitional matrices show the proportion (or number)
of employees in different job categories at different times
©McGraw-Hill Education
The Human Resource Planning Process 4 of 13
Forecasting continued
Determining labor surplus or shortage
• ascertain whether there will be a labor shortage or labor surplus
for the respective job categories
• determine what to do about these potential problems
LO 5-3
©McGraw-Hill Education
The Human Resource Planning Process 5 of 13
Goal Setting and Strategic Planning
• Focus attention on the problem and provide a
benchmark for determining the relative success of
any programs aimed at redressing a pending labor
shortage or surplus
• Analyze labor supply and demand and include a
figure for what should happen with the job
category or skill area and a timetable
©McGraw-Hill Education
Table 5.2 Options for Reducing an Expected
Labor Surplus
Option Speed
Human
Suffering
Downsizing FAST High
Pay reductions FAST High
Demotions FAST High
Transfers FAST Moderate
Work sharing FAST Moderate
Hiring Freeze SLOW Low
Natural attrition SLOW Low
Early retirement SLOW Low
Retraining SLOW Low
©McGraw-Hill Education
Table 5.3 Options for Avoiding an Expected
Labor Shortage
Option Speed Revocability
Overtime FAST High
Temporary employees FAST High
Outsourcing FAST High
Retrained transfers SLOW High
Turnover reductions SLOW Moderate
New external hires SLOW Low
Technological
innovation
SLOW Low
©McGraw-Hill Education
The Human Resource Planning Process 6 of 13
Goal Setting and Strategic Planning continued
Downsizing
• Reduce labor costs
• Technological changes reduce need for labor
• Organizations change business location for economic
reasons
• Has negative effects on long-term organizational
effectiveness
• Leads to a loss of talent, disrupts the social
networks needed to promote creativity and flexibility
• Lets go of irreplaceable assets
• Motivation levels drop off
©McGraw-Hill Education
The Human Resource Planning Process 7 of 13
Goal Setting and Strategic Planning continued
Early Retirement Programs and Buyouts
• Baby Boomers delaying retirement
• Employers concerned about losing the experience,
implicit knowledge of older workers
• Older workers cost more
• Older workers block advancement of younger workers
• Voluntary attrition through early retirement incentive
programs
©McGraw-Hill Education
Figure 5.2 Aging of the U.S. Population
2000–2020
©McGraw-Hill Education
The Human Resource Planning Process 8 of 13
Goal Setting and Strategic Planning continued
Temporary Workers and Independent Contractors
• The most widespread means of eliminating a labor
shortage
• Advantages
• Frees the firm from administrative tasks and financial
burdens associated with being the “employer of record”
• Agencies may test employees
• Agencies may train employees
• The temporary person brings an objective perspective to
the organization’s problems and procedures
©McGraw-Hill Education
The Human Resource Planning Process 9 of 13
Goal Setting and Strategic Planning continued
Temporary Workers and Independent Contractors
continued
• Independent contractors
• Freelancers, not part of an agency
• Agree to do specific tasks for specific time periods as
part of a written contract between the worker and the
employer
©McGraw-Hill Education
The Human Resource Planning Process 10 of 13
Goal Setting and Strategic Planning continued
Outsourcing, offshoring, and immigration
• Outsourcing uses an outside organization for a broad
set of services.
• Jobs that are proprietary or require tight security
should not be outsourced.
• Offshoring is outsourcing where jobs leave one country
and go to another.
• Immigration
• H2-A and H2-B visas
©McGraw-Hill Education
The Human Resource Planning Process 11 of 13
Goal Setting and Strategic Planning continued
Altering Pay and Hours
• Garner more hours from current employees
• Cut salaries
• Reduce contributions to 401(k) plans
• Reduce number of hours of all workers
• Furloughs
©McGraw-Hill Education
The Human Resource Planning Process 12 of 13
Program Implementation and Evaluation
• Make sure that some individual is held accountable
for achieving the stated goals and has the
necessary authority and resources to accomplish
them
• Regular progress reports
• Evaluate the results
©McGraw-Hill Education
The Human Resource Planning Process 13 of 13
The Special Case of Affirmative Action Planning
• Plan for subgroups within the labor force
• Affirmative action plans forecast and monitor the
proportion of various protected group members,
such as women and minorities
• Workforce utilization review
• Controversial because some non-minorities see
them as unfair
©McGraw-Hill Education
Figure 5.4 Overview of the Individual Job Choice–
Organizational Recruitment Process
Jump to long description in appendix
©McGraw-Hill Education
The Human Resource Recruitment Process 1 of 8
Personnel Policies
• Internal versus External Recruiting: Job Security
• A vacancy provides opportunity for advancement and
promotion (promote-from-within policies)
• Sometimes upsets current managers of employees who
are recruited away
• Bringing in recruits from external sources often helps
spur creativity and innovation
• Due process policies
• Employment-at-will policies
LO 5-4
©McGraw-Hill Education
The Human Resource Recruitment Process 2 of 8
Personnel Policies continued
Extrinsic and intrinsic rewards
• “Lead-the-market” approach to pay
• Paying higher-than-current-market wages
Image advertising
• When an organization promotes itself to help draw
applicants
• Influence the degree to which the person feels attracted
to the organization
©McGraw-Hill Education
The Human Resource Recruitment Process 3 of 8
Recruitment Sources
Internal versus External Sources
• Internal
• Applicants are well known to the firm and relatively
knowledgeable about the job
• Cheaper and faster to fill vacancies internally
• Inside hires often outperform outsiders
• External
• May not be any internal recruits
• Exposure to new ideas or ways of doing business
• Good way to strengthen one’s own company and
weaken one’s competitors at the same time
LO 5-5
©McGraw-Hill Education
The Human Resource Recruitment Process 4 of 8
Recruitment Sources continued
Direct applicants and Referrals
• Self-selection
• Liftout
©McGraw-Hill Education
The Human Resource Recruitment Process 5 of 8
Recruitment Sources continued
• Electronic Recruiting (e-cruiting)
• Use the organization’s web page to solicit applications
• LinkedIn, Craigslist, Monster.com
• Social networking
©McGraw-Hill Education
The Human Resource Recruitment Process 6 of 8
Recruitment Sources continued
Public and Private Employment Agencies
• State employment office
• Primarily serve the blue-collar market
• Private agencies
• Charge the employer for referrals
• Don’t have to be unemployed to use them
• Executive search firms (headhunters)
©McGraw-Hill Education
The Human Resource Recruitment Process 7 of 8
Recruitment Sources continued
Colleges and Universities
• Placement services
• Internship programs
• High school recruiting
Evaluating the Quality of a Source
• Yield ratios
• Cost-per-hire data
©McGraw-Hill Education
The Human Resource Recruitment Process 8 of 8
Recruiters
• Functional area
• Traits
• Realism
• Enhancing recruiter impact
• Provide timely feedback
• Recruit in teams
LO 5-6
©McGraw-Hill Education
Appendix of Image Long
Descriptions
©McGraw-Hill Education
Appendix 1 Figure 5.4 Overview of the Individual Job Choice–
Organizational Recruitment Process
Recruitment influences of personnel policies, recruiter traits
and behaviors, and recruitment sources affect vacancy
characteristics and applicant characteristics.
Vacancy and applicant characteristics, in turn, affect job
choice.
Return to original slide
Chapter 6
Selection and Placement
©McGraw-HillEducation.Allrightsreserved.Authorizedonlyforinstructoruseintheclassroom.NoreproductionorfurtherdistributionpermittedwithoutthepriorwrittenconsentofMcGraw-HillEducation.
©McGraw-Hill Education
Learning Objectives
LO 6-1 Establish the basic scientific properties of personnel
selection methods, including reliability, validity and
generalizability.
LO 6-2 Discuss how the particular characteristics of a job,
organization, or applicant affect the utility of any test.
LO 6-3 Describe the government’s role in personnel selection
decisions, particularly in areas of constitutional law,
federal laws, executive orders, and judicial precedent.
LO 6-4 List common methods used in selecting human resources.
LO 6-5 Describe the degree to which each of the common
methods used in selecting human resources meets the
demands of reliability, validity, generalizability, utility and
legality.
©McGraw-Hill Education
Introduction
• Organizations must take the utmost care with how it
chooses employees.
• These decisions impact the organization’s
competiveness, and every aspect of the job
applicant’s life.
• Organizations make sure the decisions they make
with respect to who gets accepted or rejected for
jobs promote the best interests of the company and
are fair to all parties involved.
©McGraw-Hill Education
Selection Method Standards 1 of 11
Reliability
Validity
Generalizability
Utility
Legality
LO 6-1
©McGraw-Hill Education
Selection Method Standards 2 of 11
Reliability
Estimating the reliability of measurement
• Reliability refers to the measuring instrument rather than
to the characteristic itself
• Correlation coefficient is a measure of the degree to
which two sets of numbers are related.
• A perfect positive relationship equals +1.0
• A perfect negative relationship equals – 1.0
• Test-retest reliability
©McGraw-Hill Education
Selection Method Standards 3 of 11
Reliability continued
Standards for Reliability
• The required reliability depends in part on the nature of
the decision being made about the people being
measured.
©McGraw-Hill Education
Selection Method Standards 4 of 11
Validity
• Criterion-Related Validation
• Method of establishing validity of a personnel selection
method by showing a substantial correlation between
test scores and job-performance scores
• Validity coefficient
• Predictive validation
• Concurrent validation
©McGraw-Hill Education
Figure 6.3 Graphic Depiction of Concurrent and
Predictive Validation Designs 1 of 2
Jump to long description in appendix
©McGraw-Hill Education
Figure 6.3
Graphic Depiction
of Concurrent and
Predictive
Validation
Designs 2 of 2
Jump to long description in appendix
©McGraw-Hill Education
Table 6.1 Required Level of Correlation to Reach
Statistical Significance as a Function of Sample Size
Sample Size Required Correlation
5 .75
10 .58
20 .42
40 .30
80 .21
100 .19
©McGraw-Hill Education
Selection Method Standards 5 of 11
Content Validation
• A test-validation strategy performed by
demonstrating that the items, questions, or
problems posed by a test are a representative
sample of the kinds of situations or problems that
occur on the job
• Best for small-sample settings
©McGraw-Hill Education
Selection Method Standards 6 of 11
Generalizability
• The degree to which the validity of a selection
method established in one context extends to
other contexts.
• Different situations
• Different samples of people
• Validity generalization
©McGraw-Hill Education
Selection Method Standards 7 of 11
Utility
• The degree to which information provided by
selection methods enhances the effectiveness of
selecting personnel
• Utility is impacted by
• Reliability
• Validity
• Generalizability
LO 6-2
©McGraw-Hill Education
Selection Method Standards 8 of 11
Legality
• All selection methods should adhere to existing
laws and legal precedents.
• Federal legislation
• Civil Rights Act of 1964 and 1991
• Age Discrimination in Employment Act of 1967
• Americans with Disabilities Act of 1991
LO 6-3
©McGraw-Hill Education
Selection Method Standards 9 of 11
Legality continued
Civil Rights Act of 1991
• Protects individuals from discrimination based
on race, color, sex, religion and national origin.
• Differs from the 1964 act in three areas
1. Establishes employers’ explicit obligation to
establish neutral-appearing selection method.
2. Allows a jury to decide punitive damages.
3. Explicitly prohibits granting preferential treatment to
minority groups
©McGraw-Hill Education
Selection Method Standards 10 of 11
Legality continued
Age Discrimination in Employment Act of 1967
• Outlaws “mandatory retirement programs”
• Covers over age 40 individuals
• No protection for younger workers
©McGraw-Hill Education
Selection Method Standards 11 of 11
Legality continued
Americans with Disabilities Act
• Protects individuals with physical or mental disabilities (or
with a history of the same).
• Reasonable accommodations are required by the
organization to allow the disabled to perform essential
functions of the job.
• An employer need not make accommodations that
cause undue hardship.
• Restrictions on pre-employment inquiries
©McGraw-Hill Education
Types of Selection Methods 1 of 12
Interviews
References, Application Blanks, Background
Checks
Physical Ability Tests
Cognitive Ability Tests
Personality Inventories
Work Samples
Honest Tests and Drug Tests
LO 6-4
©McGraw-Hill Education
Types of Selection Methods 2 of 12
Interviews
Selection Interviews
• Should be structured, standardized, and focused on
goals oriented to skills and observable behaviors.
• Interviewers should be able to quantitatively rate each
interview.
• Interviewers should have a structured note-taking
system that will aid recall to satisfying ratings.
LO 6-5
©McGraw-Hill Education
Types of Selection Methods 3 of 12
Interviews continued
Situational Interviews
• Confronts applicants on specific issues, questions, or
problems likely to arise on the job
• Experience-based questions
• Future-oriented questions
©McGraw-Hill Education
Table 6.2 Examples of Experienced-Based and
Future-Oriented Situational Interview Items 1 of 2
Experience-based
Motivating employees “Think about an instance when you had to
motivate an employee to perform a task that
he or she disliked but that you needed to
have done. How did you handle that
situation?”
Resolving conflict “What was the biggest difference of opinion
you ever had with a co-worker? How did you
resolve that situation?”
Overcoming resistance to
change
“What was the hardest change you ever had
to bring about in a past job, and what did
you do to get the people around you to
change their thoughts or behaviors?”
©McGraw-Hill Education
Table 6.2 Examples of Experienced-Based and
Future-Oriented Situational Interview Items 2 of 2
Future-Oriented
Motivating employees “Suppose you were working with an employee
who you knew greatly disliked performing a
particular task. You needed to get this task
completed, however, and this person was the
only one available to do it. What would you do
to motivate that person?”
Resolving conflict “Imagine that you and a co-worker disagree
about the best way to handle an absenteeism
problem with another member of your team.
How would you resolve that situation?”
Overcoming resistance to
change
“Suppose you had an idea for a change in
work procedures that would enhance quality,
but some members of your work group were
hesitant to make the change. What would you
do in that situation?”
©McGraw-Hill Education
Types of Selection Methods 4 of 12
References, Application Blanks, and Background
Checks
• Reference checks are weak predictors of future job
success
• Background information from applicants is low-cost
and useful
• Educational information not always valid
• Resume fraud
©McGraw-Hill Education
Types of Selection Methods 5 of 12
Physical Ability Tests
1. muscular tension
2. muscular power
3. muscular endurance
4. cardiovascular endurance
5. flexibility
6. balance
7. coordination
©McGraw-Hill Education
Types of Selection Methods 6 of 12
Cognitive Ability Tests
• Verbal comprehension
• Quantitative ability
• Reasoning ability
• Have adverse impact on some minority groups
• Race norming
©McGraw-Hill Education
Types of Selection Methods 7 of 12
Personality Inventories
• Five major dimensions of personality, known as the
“Big Five”
• extroversion
• adjustment
• agreeableness
• conscientiousness
• openness to experience
©McGraw-Hill Education
Table 6.3 The Five Major Dimensions of
Personality Inventories
1. Extroversion Sociable, gregarious, assertive,
talkative, expressive
2. Adjustment Emotionally stable, nondepressed,
secure, content
3. Agreeableness Courteous, trusting, good-natured,
tolerant, cooperative, forgiving
4. Conscientiousness Dependable, organized,
persevering, thorough,
achievement-oriented
5. Openness to Experience Curious, imaginative, artistically
sensitive, broad-minded, playful
©McGraw-Hill Education
Types of Selection Methods 8 of 12
Personality Inventories continued
• Emotional Intelligence
• Self-awareness (knowledge of one’s strengths and
weaknesses)
• Self-regulation (the ability to keep disruptive emotions in
check),
• Self-motivation (the ability to motivate oneself and
persevere in the face of obstacles)
• Empathy (the ability to sense and read emotions in
others)
• Social skills (the ability to manage the emotions of other
people)
©McGraw-Hill Education
Types of Selection Methods 9 of 12
Personality Inventories continued
• Validity in terms of predicting job performance is
higher when scores are taken from other people
• People tend to lack insight into their own personalities
• Personalities vary across contexts
• It is easy to fake traits on tests
©McGraw-Hill Education
Types of Selection Methods 10 of 12
Work Samples
• Can vary greatly
• May include role-play, interactive videos,
simulations, or competitions
• Since tests are job-specific, generalizability is low
• Tests are expensive to develop
• Used in assessment centers
©McGraw-Hill Education
Types of Selection Methods 11 of 12
Honesty Tests and Drug Tests
• Polygraph Act of 1988 banned the use of
polygraph tests for most private companies
• Paper-and-pencil honesty testing attempts to
assess the likelihood that employees will steal.
• Also test social conformity, conscientiousness, and
emotional stability
©McGraw-Hill Education
Types of Selection Methods 12 of 12
Honesty Tests and Drug Tests continued
• Drug-use tests tend to be reliable and valid
• May represent an invasion of privacy, an
unreasonable search and seizure, or a violation of
due process
• Tests should be administered systematically to all
applicants applying for the same job
• Testing is likely to be more defensible with safety
hazards associated with failure to perform
• Test results should be reported to applicants, who
should have an avenue to appeal
©McGraw-Hill Education
Appendix of Image Long
Descriptions
©McGraw-Hill Education
Appendix 1 Figure 6.3 Graphic Depiction of Concurrent
and Predictive Validation Designs 1 of 2
Concurrent validation involves measuring all current job
incumbents on an attribute, then measuring all current job
incumbents’ performance, and obtaining a correlation
between these two numbers.
Return to original slide
©McGraw-Hill Education
Appendix 2 Figure 6.3 Graphic Depiction of Concurrent
and Predictive Validation Designs 2 of 2
Predictive validation involves measuring all job applicants
on an attribute, hiring some applicants and rejecting others,
waiting for some period of time, measuring all newly hired
job incumbents’ performance, and finally obtaining a
correlation between these two sets of numbers.
Return to original slide
Chapter 7
Training
©McGraw-HillEducation.Allrightsreserved.Authorizedonlyforinstructoruseintheclassroom.NoreproductionorfurtherdistributionpermittedwithoutthepriorwrittenconsentofMcGraw-HillEducation.
©McGraw-Hill Education
Learning Objectives 1 of 2
LO 7-1 Discuss how training, informal learning, and
knowledge management can contribute to
continuous learning and companies’ business
strategy.
LO 7-2 Explain the role of the manager in identifying
training needs and supporting training on the job.
LO 7-3 Conduct a needs assessment.
LO 7-4 Evaluate employees’ readiness for training.
LO 7-5 Discuss the strengths and weaknesses of
presentation, hands-on, and group training
methods.
©McGraw-Hill Education
Learning Objectives 2 of 2
LO 7-6 Explain the potential advantages of e-learning for
training.
LO 7-7 Design a training session to maximize learning.
LO 7-8 Choose appropriate evaluation design and training
outcomes based on the training objectives and
evaluation purpose.
LO 7-9 Design a cross-cultural preparation program.
LO 7-10 Develop a program for effectively managing
diversity.
©McGraw-Hill Education
Introduction
Companies are in business to make money.
Business functions must show how they contribute
to business success.
• Training activities should help the company achieve
its business strategy.
• Training can help employees develop skills needed to
perform their jobs, which directly affects the business.
©McGraw-Hill Education
Training: Its Role in Continuous Learning and
Competitive Advantage 1 of 2
Continuous learning
• Requires employees to understand the entire
work process, acquire and apply new skills and
share what they have learned
©McGraw-Hill Education
Training: Its Role in Continuous Learning and
Competitive Advantage 2 of 2
Training
• Formal training
• Informal learning
• Explicit knowledge
• Tacit knowledge
• Knowledge management
LO 7-1
©McGraw-Hill Education
Figure 7.1 Key Features of Continuous Learning
Jump to long description in appendix
©McGraw-Hill Education
Designing Effective Formal Training Activities 1 of 14
The Training Design Process
• Instructional System Design (ISD)
• ADDIE model
• Analysis
• Design
• Development
• Implementation
• Evaluation
LO 7-2
©McGraw-Hill Education
Figure 7.2
The
Training
Process
Jump to long description in appendix
©McGraw-Hill Education
Designing Effective Formal Training Activities 2 of 14
Needs Assessment
• First step in instructional design process
• Pressure points determine if training is necessary
• Performance problems
• New technology
• Internal or external customer requests for training
• Job redesign
• New legislation
• Changes in customer preferences
LO 7-3
©McGraw-Hill Education
Figure 7.3 The Needs Assessment Process
Jump to long description in appendix
©McGraw-Hill Education
Designing Effective Formal Training Activities 3 of 14
Organizational analysis
• Support of managers and peers
• Company strategy
• Training resources
Person analysis
Task analysis
©McGraw-Hill Education
Table 7.1 Examples of Strategic Initiatives and Their
Implications for Training Practices 1 of 2
Strategic Training and
Development Initiatives Implications
Improve customer service • Ensure that employees have product and
service knowledge
• Ensure that employees have skills needed to
interact with customers
• Ensure that employees understand their roles
and decision-making authority
Improve employee
engagement
• Ensure that employees have opportunities to
develop
• Ensure that employees understand career
opportunities and personal growth
opportunities
• Ensure that training and development
addresses employees’ needs in current job
as well as growth opportunities
SOURCE: Based on S. Tannenbaum, “A Strategic View of Organizational Training and Learning,” in Creating, Implementing and Managing Effective Training and Development, ed. K. Kraiger (San Francisco: Jossey-Bass, 2002), pp. 10–52.
©McGraw-Hill Education
Table 7.1 Examples of Strategic Initiatives and Their
Implications for Training Practices 2 of 2
Strategic Training and
Development Initiatives Implications
Enhance innovation and
creativity
• Capture insight and information from
knowledgeable employees
• Logically organize and store information
• Provide methods to make information
available (e.g., resource guides, websites)
• Dedicate physical space to encourage
teamwork, collaboration, creativity, and
knowledge sharing
Growth in global markets • Prepare high potential managers to take over
global leadership positions
• Prepare expatriates to function crossculturally
• Train local workforce in company culture
SOURCE: Based on S. Tannenbaum, “A Strategic View of Organizational Training and Learning,” in Creating, Implementing and Managing Effective Training and Development, ed. K. Kraiger (San Francisco: Jossey-Bass, 2002), pp. 10–52.
©McGraw-Hill Education
Table 7.2 Questions to Ask Vendors and Consultants
How do your products and services fit our needs?
How much and what type of experience does your company have in designing
and delivering training?
What are the qualifications and experiences of your staff?
Can you provide demonstrations or examples of training programs you have
developed?
Can you provide references from clients for whom you worked?
What evidence do you have that your programs work?
How long will it take to develop the training program?
How much will your services cost?
What instructional design methods do you use?
What about recurring costs, such as those related to administering, updating,
and maintaining the training program?
Do you provide technical support?
SOURSOURCES: Adapted from R. Zemke and J. Armstrong, “Evaluating Multimedia Developers,” Training, November 1996, pp. 33–38;
B. Chapman, “How to Create the Ideal RFP,” Training, January 2004, pp. 40–43; M. Weinstein, “What Vendors Wished You Knew,” Training,
February 2010, pp. 122–125.CES: Adapted from R. Zemke and J. Armstrong, “Evaluating Multimedia Developers,” Training, November 1996,
pp. 33–38; B. Chapman, “How to Create the Ideal RFP,” Training, January 2004, pp. 40–43; M. Weinstein, “What Vendors Wished You Knew
,” Training, February 2010, pp. 122–125.
©McGraw-Hill Education
Designing Effective Formal Training Activities 4 of 14
Ensuring Employees’ Readiness for Training
• Readiness for Training includes the employee
characteristics that provide them with the desire,
focus, and energy to learn.
• Motivation to Learn is the desire to learn the
content of a training program.
• Self-efficacy reflects the employee belief that
they can learn content of training program.
LO 7-4
©McGraw-Hill Education
Table 7.3 Factors that Influence Motivation to Learn
Self-efficacy
Benefits/Consequences
Awareness of Needs
Work Environment
Basic Skills
Goal Orientation
Conscientiousness
©McGraw-Hill Education
Table 7.4 Conditions for Learning and Their Importance
Conditions for Learning
• Need to know why they should learn.
• Meaningful training content.
• Opportunities for practice.
• Feedback.
• Observe, experience, and interact with training
content, other learners, and instructor.
• Good program coordination and administration.
• Commit training content to memory.
©McGraw-Hill Education
Designing Effective Formal Training Activities 5 of 14
Ensuring Transfer of Training
• Manager support
• Action plan
• Peer support
• Support network
©McGraw-Hill Education
Figure 7.4 Work Environment Characteristics
Influencing Transfer of Training
Jump to long description in appendix
©McGraw-Hill Education
Designing Effective Formal Training Activities 6 of 14
Ensuring Transfer of Training continued
• Opportunity to use learned capabilities
• Opportunity to perform
©McGraw-Hill Education
Designing Effective Formal Training Activities 7 of 14
Ensuring Transfer of Training continued
• Technological Support: Performance Support and
Knowledge Management Systems
• Performance support systems
• Computer applications that can provide, as
requested, skills training, information access, and
expert advice
• Knowledge management systems
• Communities of practice
©McGraw-Hill Education
Designing Effective Formal Training 8 of 14
Ensuring Transfer of Training continued
• Self-management skills
• Set goals for using skills or behaviors on the job
• Identify conditions under which they might fail to use
them
• Identify the positive and negative consequences of using
them
• Monitor their use of them
©McGraw-Hill Education
Designing Effective Formal Training Activities 9 of 14
Selecting Training Methods
• Instructor-led classroom
• Online learning
• Mobile learning
• Social learning
• Blended learning
LO 7-5
©McGraw-Hill Education
Figure 7.5 Overview of Use of Training Methods
Data from “2014 Industry Report” Training, November/December 2014, pp. 16-29
©McGraw-Hill Education
Designing Effective Formal Training Activities 10 of 14
Selecting Training Methods continued
• Presentation Methods
• Instructor-led classroom
• Distance learning
• Teleconferencing
• Webcasting
• Audiovisual training
©McGraw-Hill Education
Designing Effective Formal Training Activities 11 of 14
Selecting Training Methods continued
• Hands-on Methods
• On-the-job training (OJT)
• Apprenticeship
• Internship
• Simulation
• Virtual reality
• Avatars
• Games and case studies
©McGraw-Hill Education
Designing Effective Formal Training Activities 12 of 14
Selecting Training Methods continued
• Hands-on Methods continued
• Behavior modeling
• E-learning
• Repurposing
• MOOCs
• Blended learning
• Learning management systems
LO 7-6
©McGraw-Hill Education
Designing Effective Formal Training Activities 13 of 14
Group- or Team-Building Methods
• Group- or team-building methods
• Experiential programs
• Adventure learning
• Team training
• Cross-training
• Coordination training
• Team leader training
• Action learning
©McGraw-Hill Education
Designing Effective Formal Training Activities 14 of 14
Advice for Selecting a Training Method
• Identify the type of learning outcome the training is
to influence
• Verbal information, intellectual skills, cognitive strategies,
attitudes, motor skills, or some combination
• Consider the training budget
LO 7-7
©McGraw-Hill Education
Evaluating Training Programs 1 of 3
Training outcomes can be categorized five ways
• Cognitive outcomes
• Skill-based outcomes
• Affective outcomes
• Results
• Return on investment
LO 7-8
©McGraw-Hill Education
Table 7.7 Outcomes Used in Evaluating Training
Programs
OUTCOME WHAT IS MEASURED HOW MEASURED EXAMPLE
Cognitive
outcomes
Acquisition of
knowledge
Pencil-and-paper tests
Work sample
Safety rules
Electrical principles
Steps in appraisal
interview
Skill-based
outcomes
Behavior
Skills
Observation
Work sample
Ratings
Jigsaw use
Listening skills
Coaching skills
Airplane landings
Affective
outcomes
Motivation
Reaction to program
Attitudes
Interviews
Focus groups
Attitude surveys
Satisfaction with
training
Beliefs regarding
other cultures
Results Company payoff Observation
Data from information system
or performance records
Absenteeism
Accidents
Patents
Return on
investment
Economic value of
training
Identification and comparison
of costs and benefits of the
program
Dollars
©McGraw-Hill Education
Evaluating Training Programs 2 of 3
Evaluation Designs
• Posttest only
• Pretest/Posttest
• Posttest only with comparison group
• Pretest/Posttest with comparison group
• Time series
©McGraw-Hill Education
Evaluating Training Programs 3 of 3
Determining the Financial Benefits of Learning
• Return on Investment refers to the estimated
dollar return from each dollar invested in learning.
1. Identify outcomes
2. Place a value on outcomes
3. Determine change in performance
4. Obtain an annual amount of benefits
5. Determine training costs
6. Calculate total savings
7. Calculate ROI
©McGraw-Hill Education
Special Training Issues 1 of 5
Cross-Cultural Preparation
• Expatriate
• Competent in area of expertise
• Able to communicate in host country
• Culturally sensitive
• Motivated to succeed
• Supported by family
LO 7-9
©McGraw-Hill Education
Special Training Issues 2 of 5
Cross-Cultural Preparation continued
• Predeparture phase
• Receive language training and orientation
• Include the family
• Discuss career plans and positions expected upon
return
©McGraw-Hill Education
Special Training Issues 3 of 5
Cross-Cultural Preparation continued
• On-site phase
• Orientation to host country
• Develop social relationships
• Repatriation phase
• Self-managed
• Provide company newsletters and local
newspapers
• Adjust to lower standard of living
©McGraw-Hill Education
Special Training Issues 4 of 5
Managing Workforce Diversity and Inclusion
• Manage diversity
• Inclusion
• Diversity training
• May enhance performance and impact:
• Cognitive outcomes
• Affective outcomes
• Behavioral outcomes
LO 7-10
©McGraw-Hill Education
Table 7.9 Key Components of Effective Diversity
Management Programs 1 of 7
Top Management Support
• Make the business case for diversity.
• Include diversity as part of the business strategy
and corporate goals.
• Participate in diversity programs, and encourage
all managers to attend.
• Ensure that the composition of the executive
management team mirrors the diversity of the
workforce.
©McGraw-Hill Education
Table 7.9 Key Components of Effective Diversity
Management Programs 2 of 7
Recruitment and Hiring
• Ask search firms to identify wider arrays of
candidates.
• Enhance the interviewing, selection, and hiring
skills of managers.
• Expand college recruitment at historically minority
colleges.
©McGraw-Hill Education
Table 7.9 Key Components of Effective Diversity
Management Programs 3 of 7
Talent Identification and Development
• Form a partnership with internship programs that
target minority students for management careers.
• Establish a mentoring process.
• Refine the company’s global succession planning
system to improve identification of talent.
• Improve the selection and development of managers
and leaders to help ensure that they are capable of
maximizing team performance.
• Ensure that all employees, especially women and
minorities, have access to management development
and leadership programs.
©McGraw-Hill Education
Table 7.9 Key Components of Effective Diversity
Management Programs 4 of 7
Employee Support
• Form resource groups or employee network groups,
including employees with common interests, and use
them to help the company develop business goals and
understand the issues they are concerned with (e.g.,
Asian Pacific employees, women, gays, lesbians,
transgender employees, Native Americans, veterans,
Hispanics).
• Celebrate cultural traditions, festivities, and holidays.
• Make work/life balance initiatives (such as flextime,
telecommuting, and eldercare) available to all
employees.
©McGraw-Hill Education
Table 7.9 Key Components of Effective Diversity
Management Programs 5 of 7
Fair Treatment
• Conduct extensive diversity training.
• Implement an alternative dispute resolution
process.
• Include women and minorities on all human
resources committees throughout the company.
©McGraw-Hill Education
Table 7.9 Key Components of Effective Diversity
Management Programs 6 of 7
Manager Accountability
• Link managers’ compensation to their success in
meeting diversity goals and creating openness
and inclusion in the workplace.
• Use employee attitude or engagement surveys to
track employees’ attitudes on inclusion, fairness,
opportunities for development, work/life balance,
and perceptions of the company culture.
• Implement 360-degree feedback for all managers
and supervisors.
©McGraw-Hill Education
Table 7.9 Key Components of Effective Diversity
Management Programs 7 of 7
Relationships with External Stakeholders
• Increase marketing to diverse communities.
• Provide customer service in different languages.
• Broaden the company’s base of suppliers and
vendors to include businesses owned by
minorities and women.
• Provide scholarships and educational and
neighborhood grants to diverse communities and
their members.
©McGraw-Hill Education
Special Training Issues 5 of 5
Onboarding or Socialization
• Onboarding
• Establish relationships to increase satisfaction
• Clarify goals and expectations to improve
performance
• provide feedback, coaching, and follow-up activities
to reduce turnover
©McGraw-Hill Education
Figure 7.6 The Four Steps in Onboarding
©McGraw-Hill Education
Table 7.10 Characteristics of Effective Onboarding
Programs
• Employees are encouraged to ask questions.
• Program includes information on both technical and social aspects of
the job.
• The employee manager has some onboarding responsibility.
• Debasing or embarrassing new employees is avoided.
• Employees learn about the company culture, history, language,
products, services, and customers.
• Follow-up of employee progress occurs at different points up to one
year after joining the company.
• Program involves participation, active involvement, and formal and
informal interaction between new hires and current employees.
• Relocation assistance is provided (such as house hunting or
information sessions on the community for employees and their
significant others).
©McGraw-Hill Education
Appendix of Image Long
Descriptions
©McGraw-Hill Education
Appendix 1 Figure 7.1 Key Features of
Continuous Learning
A circle graph shows that formal training and development,
informal learning, and knowledge management are the key
features of a continuous learning philosophy that focuses
on performance and supports business strategy.
Return to original slide
©McGraw-Hill Education
Appendix 2 Figure 7.2 The Training
Process
Stage 1 Needs Assessment: organizational analysis, person analysis, and task analysis
Stage 2 Ensuring employees’ readiness for training: attitudes and motivation, and basic
skills
Stage 3 Creating a learning environment: I*dentification of learning objectives and
training outcomes, meaningful material, feedback, observations of others, administering
and coordinating program
Feedback
Stage 4 Ensuring transfer of training: self-management strategies, and peer and
manager support
Stage 5 Selecting training methods: presentational methods, hand-on methods, and
group or team-building methods
Stage 6 Evaluating training programs: identification of training outcomes and evaluation
design, and cost-benefit analysis
Return to original slide
©McGraw-Hill Education
Appendix 3 Figure 7.3 The Needs Assessment Process
Organization analysis (What is the context?), person analysis (Who needs training?), and task analysis (In what do they need training?)
Reasons or pressure points
legislation
lack of basic skills
poor performance
new technology
customer requests
new products
higher performance standards
new jobs
business growth or contraction
global business expansion
Outcomes
what trainees need to learn
who receives training
type of training
frequency of training
buy-versus-build training decision
training versus other HR options such as selection or job redesign
how training should be evaluated
Return to original slide
©McGraw-Hill Education
Appendix 4 Figure 7.4 Work Environment
Characteristics Influencing Transfer of Training
Transfer of training is influenced by opportunity to use
learned capability, technological support, manager support,
peer support, and self-management skills.
Return to original slide
Chapter 8
Performance Management
©McGraw-HillEducation.Allrightsreserved.Authorizedonlyforinstructoruseintheclassroom.NoreproductionorfurtherdistributionpermittedwithoutthepriorwrittenconsentofMcGraw-HillEducation.
©McGraw-Hill Education
Learning Objectives 1 of 2
LO8-1 Identify the major parts of an effective performance
management process.
LO8-2 Discuss the three general purposes of performance
management.
LO8-3 Identify the five criteria for effective performance
management systems.
LO8-4 Discuss the five approaches to performance
management, the specific techniques used in each
approach, and the way these approaches compare
with the criteria for effective performance
management systems.
LO8-5 Choose the most effective approach to performance
measurement for a given situation.
©McGraw-Hill Education
Learning Objectives 2 of 2
LO8-6 Discuss the advantages and disadvantages of the
different sources of performance information.
LO8-7 Choose the most effective source(s) for
performance information for any situation.
LO8-8 Discuss the potential advantages of social
performance management and electronic
monitoring for performance management.
LO8-9 Distinguish types of rating errors, and explain how
to minimize each in a performance evaluation.
LO8-10 Conduct an effective performance feedback
session.
LO8-11 Identify the cause of a performance problem.
©McGraw-Hill Education
Introduction
Performance Management
• Ensure employee activities are congruent with goals
Performance Appraisal
• Organization gets information on how well an
employee is doing his or her job
Performance Feedback
• Provide employees information on their performance
©McGraw-Hill Education
The Practice of Performance Management
Performance management is a prevalent practice,
but often not valued or used effectively.
• Many managers don’t consider yearly performance
evaluations useful
• Half of employees are surprised by their ratings
• Most employees are unhappy because they
expected a higher rating
©McGraw-Hill Education
Figure 8.1 Model of the Effective Performance
Management Process
Jump to long description in appendix
©McGraw-Hill Education
The Process of Performance Management 1 of 5
Step 1
• Understand and identify important performance
outcomes or results
• Align goals and behaviors to organization’s
strategies and goals
LO 8-1
©McGraw-Hill Education
The Process of Performance Management 2 of 5
Step 2
• Understand the process (or how) to achieve the
goals established in the first step
• Identifying measurable goals, behaviors, and activities
that will help employees achieve the performance results
• Make these part of the employees’ job descriptions
©McGraw-Hill Education
The Process of Performance Management 3 of 5
Step 3
• Provide employees with training, necessary
resources and tools, and frequent feedback
• Focus on accomplishments as well as issues and
challenges influencing performance
©McGraw-Hill Education
The Process of Performance Management 4 of 5
Step 4
• The manager and the employee discuss and
compare the targeted performance goals and
supporting behaviors with the actual results
• Annual or biannual formal performance review
©McGraw-Hill Education
The Process of Performance Management 5 of 5
Step 5
• Identify what the employee can do to capitalize on
performance strengths and address weaknesses
Step 6
• Provide consequences for achieving (or failing to
achieve) performance outcomes
©McGraw-Hill Education
Purposes of Performance Management 1 of 3
Strategic Purpose
• Performance management system should link
employee activities with the organization’s goals
• Define the results, behaviors, and employee
characteristics that are necessary for carrying
out those strategies, and then
• Develop measurement and feedback systems
LO 8-2
©McGraw-Hill Education
Purposes of Performance Management 2 of 3
Administrative Purpose
• Performance management information used for
salary decisions, promotions, retention-termination,
layoffs, and recognition of individual performance
• Managers tend to be uncomfortable rating
employees
©McGraw-Hill Education
Purposes of Performance Management 3 of 3
Developmental Purpose
• Improve the performance of employees
• Includes deficiencies and the causes of
deficiencies
• Helps good performers get training and
opportunities
• GPS system
©McGraw-Hill Education
Performance Measures Criteria 1 of 6
Strategic Congruence
• Emphasizes the need for the performance
management system to guide employees in
contributing to the organization’s success
• Must be flexible to adapt to change
• Critical success factors (CSFs)
LO 8-3
©McGraw-Hill Education
Performance Measures Criteria 2 of 6
Strategic Congruence continued
• Using nonfinancial performance measures
• Develop a model
• Use existing databases or develop measures
• Use statistical and qualitative methods
• Revisit the model and revise
• Act on conclusions
• Audit to see if the desired result was achieved
©McGraw-Hill Education
Performance Measures Criteria 3 of 6
Validity
• Must not be deficient or contaminated
• It is deficient if it does not measure all aspects
of performance
• It is contaminated if it evaluates irrelevant
aspects of performance or aspects that are not
job related
• Concerned with maximizing the overlap between
actual job performance and the measure of job
performance
©McGraw-Hill Education
Figure 8.2 Contamination and Deficiency of
a Job Performance Measure
©McGraw-Hill Education
Performance Measures Criteria 4 of 6
Reliability
• Interrater reliability
• The consistency among the individuals who evaluate the
employee’s performance
• Test-retest reliability
• Should be reliable over time
©McGraw-Hill Education
Performance Measures Criteria 5 of 6
Acceptability
• May take too much time or not be accepted as fair
• Three categories of fairness: procedural, interpersonal,
and outcome
©McGraw-Hill Education
Table 8.2 Categories of Perceived Fairness and
Implications for Performance Management Systems
FAIRNESS
CATEGORY
IMPORTANCE
FOR
PERFORMANCE
MANAGEMENT
SYSTEM IMPLICATIONS
Procedural
fairness
Development • Give managers and employees opportunity to
participate in development of system
• Ensure consistent standards when evaluating
different employees
• Minimize rating errors and biases
Interpersonal
fairness
Use • Give timely and complete feedback
• Allow employees to challenge the evaluation
• Provide feedback in an atmosphere of respect
and courtesy
Outcome
fairness
Outcomes • Communicate expectations regarding
performance evaluations and standards
• Communicate expectations regarding rewards
©McGraw-Hill Education
Performance Measures Criteria 6 of 6
Specificity
• Relevant to both strategic and developmental
purposes
• Must measure what an employee must do to
achieve company’s goals
• Must point out employee’s performance problems
©McGraw-Hill Education
Approaches to Measuring Performance 1 of 19
The Comparative Approach
• Ranking
• Simple ranking – highest performer to poorest
performer
• Alternation ranking – cross one name off the list
at a time
LO 8-4
©McGraw-Hill Education
Approaches to Measuring Performance 2 of 19
The Comparative Approach continued
• Forced distribution
• Employees ranked in predetermined categories
• Helps managers tailor development activities to
employees based on their performance
• Ethical if the system is clearly communicated, the
system is part of a positive dimension of the
organization’s culture, and the employees have the
chance to appeal decisions
©McGraw-Hill Education
Table 8.3 Performance and Development Based
on Forced Distribution and Ranking
RANKING OR
DISTRIBUTION
CATEGORY PERFORMANCE AND DEVELOPMENT PLAN
A
Above average
Exceptional
A1 performer
• Accelerate development through challenging job assignments
• Provide mentor from leadership team
• Recognize and reward contributions
• Praise employee for strengths
• Consider leadership potential
• Nominate for leadership development programs
B
Average
Meets expectations
Steady performer
• Offer feedback on how B can become a high performer
• Encourage development of strengths and improvement of
weaknesses
• Recognize and reward employee contributions
• Consider enlarging job
C
Below expectations
Poor performance
• Give feedback and agree upon what specific skills, behavior, and/or
results need to be improved, with timetable for accomplishment
• Move to job that better matches skills
• Ask to leave the company
Based on B. Axelrod, H. Handfield-Jones, and E. Michaels, “A New Game Plan for C Players,” HBR, January 2002, pp. 80–88; Walker, “Is Performance Management
as Simple as ABC?” T + D, February 2007, pp. 54–57; T. De Long and V. Vijayaraghavan, “Let’s Hear It for B Players,” HBR, June 2003, pp. 96–102.
©McGraw-Hill Education
Approaches to Measuring Performance 3 of 19
The Comparative Approach continued
• Paired comparison
• Tends to be time consuming
©McGraw-Hill Education
Approaches to Measuring Performance 4 of 19
The Comparative Approach continued
• Evaluating the Comparative Approach
• Virtually eliminates problems of leniency, central
tendency, and strictness
• Problems
• Often not linked to strategic goals
• Validity and reliability depend on the raters
themselves
• Individuals are completely unaware of what they
must do differently to improve their ranking
• Employees and managers are less likely to
accept evaluations
©McGraw-Hill Education
Approaches to Measuring Performance 5 of 19
The Attribute Approach
• Graphic Rating Scales
• Evaluate a list of traits on a five-point scale
• Can be discrete scale or continuous scale
©McGraw-Hill Education
Approaches to Measuring Performance 6 of 19
The Attribute Approach continued
• Mixed-Standard Scales
• Define the relevant performance dimensions and then
develop statements representing good, average, and
poor performance along each dimension
• These statements are then mixed with the statements
from other dimensions on the actual rating instrument
©McGraw-Hill Education
Approaches to Measuring Performance 7 of 19
The Attribute Approach continued
• Evaluating the attribute approach
• Easy to develop and generalizable
• Problems
• Usually little congruence between the techniques
and the company’s strategy
• Usually have vague performance standards that are
open to different interpretations by different raters
©McGraw-Hill Education
Approaches to Measuring Performance 8 of 19
The Behavioral Approach
• Behaviorally anchored rating scales (BARS)
• Can increase interrater reliability
• Can bias information recall
©McGraw-Hill Education
Approaches to Measuring Performance 9 of 19
The Behavioral Approach continued
• Behavioral Observation Scales (BOS)
• May require more information than most managers can
process or remember
©McGraw-Hill Education
Approaches to Measuring Performance 10 of 19
The Behavioral Approach continued
• Competency Models
• Useful for a variety of HR practices including recruiting,
selection, training, and development
• Can be used to help identify the best employees to fill
open positions
• Can be used as the foundation for development plans
that allow the employee and the manager to target
specific strengths and development areas
• Must be up-to-date, drive business performance, be job
related, be relevant for all of the company’s business
units, and provide sufficient detail to make an accurate
assessment of employees’ performance
©McGraw-Hill Education
Approaches to Measuring Performance 11 of 19
The Behavioral Approach continued
• Evaluation of the behavioral approach
• Can link the company’s strategy to the specific behavior
necessary for implementing that strategy
• Provides specific guidance and feedback for employees
about the performance expected of them
• Acceptability and reliability are high
• Weaknesses
• Behaviors and measures must be continually
monitored and revised
• Assumes that there is “one best way” to do the job
and that the behaviors that constitute this best way
can be identified
©McGraw-Hill Education
Approaches to Measuring Performance 12 of 19
The Results Approach
• The Use of Objectives
• Managers set goals that are used as standards to
evaluate individuals’ performance
• Results-based systems have three common components
• Require setting effective goals (SMART)
• Different types of measurements can be used for goals or
objectives
• Goals usually set with managers’ and subordinates’
participation
©McGraw-Hill Education
Table 8.9 Best Practices in Goal Setting
1. Employees and managers should discuss and set no
more than three to five goals.
2. Goals should be brief, meaningful, challenging, and
include the results the employee is expected to achieve.
3. The time frame for goal achievement should be related
to when they are expected to be accomplished.
4. The relationship between goals and rewards should be
appropriate.
5. Goals should be “linked up” rather than “cascaded
down.” This means that functions, teams, and
employees should set their own goals that are related to
company goals.
©McGraw-Hill Education
Approaches to Measuring Performance 13 of 19
The Results Approach continued
• Balanced Scorecard
• Four perspectives of performance
• Financial
• Customer
• Internal or operations
• Learning and growth
©McGraw-Hill Education
Approaches to Measuring Performance 14 of 19
The Results Approach continued
• Productivity Measurement and Evaluation System
(ProMES)
1. Identify the products, or the set of activities or
objectives, the organization expects to accomplish
2. Define indicators of the products
3. Establish the contingencies between the amount of the
indicators and the level of evaluation associated with
that amount
4. Develop a feedback system
©McGraw-Hill Education
Approaches to Measuring Performance 15 of 19
The Results Approach continued
• Evaluation of the Results Approach
• Minimizes subjectivity
• Links an individual’s results with the organization’s
strategies and goals
• Challenges
• Can be both contaminated and deficient
• Individuals may focus only on aspects of their
performance that are measured, neglecting those that
are not
• Feedback may not help employees learn how they
need to change their behavior to increase their
performance
©McGraw-Hill Education
Approaches to Measuring Performance 16 of 19
The Quality Approach
Customer orientation
Prevention approach to errors
Continuous improvement
©McGraw-Hill Education
Approaches to Measuring Performance 17 of 19
The Quality Approach continued
• Most existing systems measure performance in
terms of quantity, not quality.
• Employees are held accountable for good or bad
results to which they contribute but do not
completely control.
• Companies do not share the financial rewards of
successes with employees according to how much
they have contributed to them.
• Rewards are not connected to business results
©McGraw-Hill Education
Approaches to Measuring Performance 18 of 19
The Quality Approach continued
• Statistical process control techniques
• Process-flow analysis
• Cause-and-effect diagrams
• Pareto charts
• Control charts
• Histograms
• Scattergrams
©McGraw-Hill Education
Approaches to Measuring Performance 19 of 19
The Quality Approach continued
• Evaluation of the quality approach
• Adopts a systems-oriented focus
• Advocates evaluation of personal traits (such as
cooperation), which are difficult to relate to job
performance unless the company has been structured
into work teams
LO 8-5
©McGraw-Hill Education
Choosing a Source for Performance
Information 1 of 6
Managers
• Most frequently used source of performance
information
• Motivated to make accurate ratings
• Feedback from supervisors is strongly related to
performance and to employee perceptions of the
accuracy of the appraisal
LO 8-6, 8-7
©McGraw-Hill Education
Choosing a Source for Performance
Information 2 of 6
Peers
• Have expert knowledge of job requirements
• Often have the most opportunity to observe the
employee
• Often in the best position to praise and recognize
each other’s performance on a daily basis in dayto-day activities
• Peers are not expected to provide feedback
©McGraw-Hill Education
Choosing a Source for Performance
Information 3 of 6
Direct Reports
• Have best opportunity to evaluate how manager
treats employees
• Upward feedback
• Gives subordinates power over managers
• Might lead to emphasis of employee satisfaction
over production
©McGraw-Hill Education
Choosing a Source for Performance
Information 4 of 6
Self
• Not often used as the sole source of performance
information, but can still be valuable
• Tendency toward inflated assessments
©McGraw-Hill Education
Choosing a Source for Performance
Information 5 of 6
Customers
• The customer is often the only person present to
observe the employee’s performance and thus is
the best source of performance information.
• Service companies use customer evaluations.
• When an employee’s job requires direct service to the
customer or linking the customer to other services within
the company
• When the company is interested in gathering information
to determine what products and services the customer
wants
©McGraw-Hill Education
Choosing a Source for Performance
Information 6 of 6
360-Degree Appraisal
• Multiple raters (boss, peers, subordinates,
customers) provide input into a manager’s
evaluation.
• Minimizes bias
©McGraw-Hill Education
Use of Technology in Performance
Management 1 of 4
Technology influences performance management
systems in three ways
• Web-based systems
• Social media
• Social performance management
• Electronic tracking and monitoring systems
• Software that analyzes employees’ computers
and creates a profile
• Wearables
LO 8-8
©McGraw-Hill Education
Use of Technology in Performance
Management 2 of 4
Privacy Concerns
• Electronic monitoring systems threaten employees’
rights and dignity to work without being monitored
• Needless surveilling results in less productivity and
motivation, demoralizes employees, and creates
stress
©McGraw-Hill Education
Use of Technology in Performance
Management 3 of 4
Reducing Rater Errors, Politics, and Increasing
Reliability and Validity of Ratings
• Heuristics
• Unconscious bias
• Appraisal politics
LO 8-9
©McGraw-Hill Education
Table 8.12 Typical Rater Errors
RATER ERROR DESCRIPTION
Similar to me Individuals who are similar to us in race, gender, background,
interest, beliefs, and the like receive higher ratings than those
who are not.
Contrast Ratings are influenced by comparison between individuals
instead of an objective standard (e.g., employee receives lowerthan-deserved ratings because he or she is compared to
outstanding peers).
Leniency Rater gives high ratings to all employees regardless of their
performance.
Strictness Rater gives low ratings to all employees regardless of their
performance.
Central tendency Rater gives middle or average ratings to all employees despite
their performance.
Halo Rater gives employee high ratings on all aspects of performance
because of an overall positive impression of the employee.
Horns Rater gives employee low ratings on all aspects of performance
because of an overall negative impression of the employee.
©McGraw-Hill Education
Use of Technology in Performance
Management 4 of 4
Reducing Rater Errors, Politics, and Increasing
Reliability and Validity of Ratings continued
• Reducing errors
• Error training
• Frame-of-reference training
• Unconscious bias training
• Calibration meetings
©McGraw-Hill Education
Performance Feedback
The Manager’s Role in an Effective Performance
Feedback Process
• Feedback Should Be Given Frequently, Not Once a Year
• Create the Right Context for the Discussion.
• Ask the Employee to Rate His or Her Performance before
the Session.
• Have Ongoing, Collaborative Performance Conversations.
• Recognize Effective Performance through Praise.
• Focus on Solving Problems.
• Focus Feedback on Behavior or Results, Not on the Person.
• Minimize Criticism.
• Agree to Specific Goals and Set a Date to Review Progress.
LO 8-10
©McGraw-Hill Education
What Managers Can Do to Diagnose
Performance Problems and Manage Employees’
Performance 1 of 2
Diagnosing the Causes of Poor Performance
• Consider whether the poor performance is
detrimental to the business
• Determine the cause
• Meet with the employee
LO 8-11
©McGraw-Hill Education
What Managers Can Do to Diagnose
Performance Problems and Manage Employees’
Performance 2 of 2
Actions for Managing Employees’ Performance
• Take into account employees’ ability, motivation, or
both
• Solid performers – high ability and motivation
• Misdirected effort – motivated but lack of ability
• Underutilizers – have ability but lack motivation
• Deadwood – low ability and motivation
©McGraw-Hill Education
Figure 8.8
Factors to
Consider in
Analyzing
Poor
Performance
Jump to long description in appendix
©McGraw-Hill Education
Developing and Implementing a System
That Follows Legal Guidelines
Two types of cases related to performance
management
• Discrimination
• Based on age, race, gender, or national origin
• Unjust dismissal
• Dismissal for reasons other than those employer
claims
©McGraw-Hill Education
Appendix of Image Long Descriptions
©McGraw-Hill Education
Appendix 1 Figure 8.1 Model of the
Effective Performance Management
Process
Step 1 Define performance outcomes for company division
and department.
Step 2 Develop employee goals, behavior, and actions to
achieve outcomes.
Step 3 Provide support and ongoing performance
discussions.
Step 4 Evaluate performance.
Step 5 Identify improvements needed.
Step 6 Provide consequences for performance results.
Return to original slide
©McGraw-Hill Education
Appendix 2 Figure 8.8 Factors to Consider
in Analyzing Poor Performance
Input
Does the employee recognize what he or she is supposed to do? Are the job flow and procedures logical? Do
employees have the resources (tools, equipment, technology, time) needed for successful performance? Are other job
demands interfering with good performance in this area?
Employee Characteristics
Does the employee have the necessary skills and knowledge needed? Does the employee know why the desired
performance level is important? Is the employee mentally, physically, and emotionally able to perform at the expected
level?
Feedback
Has the employee been given information about his or her performance? Is performance feedback relevant, timely,
accurate, specific, and understandable?
Performance Standard/Goals
Do performance standards exist? Does the employee know the desired level of expected performance? Does the
employee believe she or he can reach the performance standard?
Consequences
Are consequences (rewards, incentives) aligned with good performance? Are the consequences of performance
valuable to the employee? Are performance consequences given in a timely manner? Do work group or team norms
encourage employees not to meet performance standards?
Return to original slide

---

Get Professional Assignment Help Cheaply

Are you busy and do not have time to handle your assignment? Are you scared that your paper will not make the grade? Do you have responsibilities that may hinder you from turning in your assignment on time? Are you tired and can barely handle your assignment? Are your grades inconsistent?

Whichever your reason is, it is valid! You can get professional academic help from our service at affordable rates. We have a team of professional academic writers who can handle all your assignments.

Why Choose Our Academic Writing Service?

• Plagiarism free papers
• Timely delivery
• Any deadline
• Skilled, Experienced Native English Writers
• Subject-relevant academic writer
• Adherence to paper instructions
• Ability to tackle bulk assignments
• Reasonable prices
• 24/7 Customer Support
• Get superb grades consistently

Online Academic Help With Different Subjects

Literature

Students barely have time to read. We got you! Have your literature essay or book review written without having the hassle of reading the book. You can get your literature paper custom-written for you by our literature specialists.

Finance

Do you struggle with finance? No need to torture yourself if finance is not your cup of tea. You can order your finance paper from our academic writing service and get 100% original work from competent finance experts.

Computer science

Computer science is a tough subject. Fortunately, our computer science experts are up to the match. No need to stress and have sleepless nights. Our academic writers will tackle all your computer science assignments and deliver them on time. Let us handle all your python, java, ruby, JavaScript, php , C+ assignments!

Psychology

While psychology may be an interesting subject, you may lack sufficient time to handle your assignments. Don’t despair; by using our academic writing service, you can be assured of perfect grades. Moreover, your grades will be consistent.

Engineering

Engineering is quite a demanding subject. Students face a lot of pressure and barely have enough time to do what they love to do. Our academic writing service got you covered! Our engineering specialists follow the paper instructions and ensure timely delivery of the paper.

Nursing

In the nursing course, you may have difficulties with literature reviews, annotated bibliographies, critical essays, and other assignments. Our nursing assignment writers will offer you professional nursing paper help at low prices.

Sociology

Truth be told, sociology papers can be quite exhausting. Our academic writing service relieves you of fatigue, pressure, and stress. You can relax and have peace of mind as our academic writers handle your sociology assignment.

Business

We take pride in having some of the best business writers in the industry. Our business writers have a lot of experience in the field. They are reliable, and you can be assured of a high-grade paper. They are able to handle business papers of any subject, length, deadline, and difficulty!

Statistics

We boast of having some of the most experienced statistics experts in the industry. Our statistics experts have diverse skills, expertise, and knowledge to handle any kind of assignment. They have access to all kinds of software to get your assignment done.

Law

Writing a law essay may prove to be an insurmountable obstacle, especially when you need to know the peculiarities of the legislative framework. Take advantage of our top-notch law specialists and get superb grades and 100% satisfaction.

What discipline/subjects do you deal in?

We have highlighted some of the most popular subjects we handle above. Those are just a tip of the iceberg. We deal in all academic disciplines since our writers are as diverse. They have been drawn from across all disciplines, and orders are assigned to those writers believed to be the best in the field. In a nutshell, there is no task we cannot handle; all you need to do is place your order with us. As long as your instructions are clear, just trust we shall deliver irrespective of the discipline.

Are your writers competent enough to handle my paper?

Our essay writers are graduates with bachelor's, masters, Ph.D., and doctorate degrees in various subjects. The minimum requirement to be an essay writer with our essay writing service is to have a college degree. All our academic writers have a minimum of two years of academic writing. We have a stringent recruitment process to ensure that we get only the most competent essay writers in the industry. We also ensure that the writers are handsomely compensated for their value. The majority of our writers are native English speakers. As such, the fluency of language and grammar is impeccable.

What if I don’t like the paper?

There is a very low likelihood that you won’t like the paper.

Reasons being:

• When assigning your order, we match the paper’s discipline with the writer’s field/specialization. Since all our writers are graduates, we match the paper’s subject with the field the writer studied. For instance, if it’s a nursing paper, only a nursing graduate and writer will handle it. Furthermore, all our writers have academic writing experience and top-notch research skills.
• We have a quality assurance that reviews the paper before it gets to you. As such, we ensure that you get a paper that meets the required standard and will most definitely make the grade.

In the event that you don’t like your paper:

• The writer will revise the paper up to your pleasing. You have unlimited revisions. You simply need to highlight what specifically you don’t like about the paper, and the writer will make the amendments. The paper will be revised until you are satisfied. Revisions are free of charge
• We will have a different writer write the paper from scratch.
• Last resort, if the above does not work, we will refund your money.

Will the professor find out I didn’t write the paper myself?

Not at all. All papers are written from scratch. There is no way your tutor or instructor will realize that you did not write the paper yourself. In fact, we recommend using our assignment help services for consistent results.

What if the paper is plagiarized?

We check all papers for plagiarism before we submit them. We use powerful plagiarism checking software such as SafeAssign, LopesWrite, and Turnitin. We also upload the plagiarism report so that you can review it. We understand that plagiarism is academic suicide. We would not take the risk of submitting plagiarized work and jeopardize your academic journey. Furthermore, we do not sell or use prewritten papers, and each paper is written from scratch.

When will I get my paper?

You determine when you get the paper by setting the deadline when placing the order. All papers are delivered within the deadline. We are well aware that we operate in a time-sensitive industry. As such, we have laid out strategies to ensure that the client receives the paper on time and they never miss the deadline. We understand that papers that are submitted late have some points deducted. We do not want you to miss any points due to late submission. We work on beating deadlines by huge margins in order to ensure that you have ample time to review the paper before you submit it.

Will anyone find out that I used your services?

We have a privacy and confidentiality policy that guides our work. We NEVER share any customer information with third parties. Noone will ever know that you used our assignment help services. It’s only between you and us. We are bound by our policies to protect the customer’s identity and information. All your information, such as your names, phone number, email, order information, and so on, are protected. We have robust security systems that ensure that your data is protected. Hacking our systems is close to impossible, and it has never happened.

How our Assignment Help Service Works

1. Place an order

You fill all the paper instructions in the order form. Make sure you include all the helpful materials so that our academic writers can deliver the perfect paper. It will also help to eliminate unnecessary revisions.

2. Pay for the order

Proceed to pay for the paper so that it can be assigned to one of our expert academic writers. The paper subject is matched with the writer’s area of specialization.

3. Track the progress

You communicate with the writer and know about the progress of the paper. The client can ask the writer for drafts of the paper. The client can upload extra material and include additional instructions from the lecturer. Receive a paper.

4. Download the paper

The paper is sent to your email and uploaded to your personal account. You also get a plagiarism report attached to your paper.

GET A PERFECT SCORE!!!

---