Chapter 1

Human
Resource
Management

McGraw-Hill/Irwin Copyright 2013 by The McGraw-Hill Companies, Inc. All rights reserved.
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Chapter 1, Human Resource Management
Chapter 2, A Strategic Approach to Human
Resource Management
Chapter 3, Legal Environment of Human Resource
Management: Equal Employment
Opportunity
Chapter 4, Global Human Resource Management

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1. Describe the term human resource management.
2. Describe the strategic importance of human
resource management (HRM) activities performed
in operations.
3. Give examples of career opportunities are
available in the HRM field.
4. Compare the role that specialists and operating
managers play in performing HRM activities.
5. Summarize the main objectives pursued by HRM
units in organizations.

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 HRM is charged with programs
concerned with people

Effective use of people

Achieving individual &

organizational goals
Getting every manager involved
HRM A.K.A. Personnel Industrial Relations, Employee Development

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1. Equal Employment opportunity (EEO)
compliance
2. Job analysis
3. Human resource planning
4. Employee recruitment, selection, motivation and
orientation
5. Performance evaluation and compensation
6. Training and development
7. Labor relations
8. Safety, health and wellness

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1. Action-oriented
2. People-oriented
3. Globally-oriented
4. Future-oriented

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 English Guilds- Masons, carpenters,
leather workers, other craftspeople

Industrial Revolution- Changing work

conditions and social patterns

World Wars- Scientific management,

welfare work, industrial psychology

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 Science
Science Harmony
Harmony

Scientific
Scientific
Management
Management
(Frederick
(Frederick Taylor)
Taylor)

Cooperation
Cooperation Maximum
Maximum output
output

Frederick
Frederick Taylor
Taylor was
was an
an engineer
engineer at
at Midvale
Midvale Steel
Steel Works
Works

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 The
Theworker
worker

Individual
Individualdifferences
differences

Maximum
Maximumwell
wellbeing
being

Hugo Munsterberg initiated the field in 1913

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 Personnel departments were created to
deal with:
Drastic changes in technology
Organizational growth
The rise of unions W
elf
ar
Government intervention e
Se
cr
Employee-management conflict et
ar
ies

No specific date for the first personnel department, employee and

management conflict began to be noted in the 1920s

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 Until the 1960s, the personnel function
was concerned only with blue-collar
employees
Noted management scholar Peter Drucker
characterized personnel as partly a file
clerks job, partly a housekeeping job,
partly a social workers job, and partly
firefighting, heading off union trouble.

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Today, HRM plays a major role in:
Clarifying the firms human resource problems
Developing solutions for them

Strategic HRM differs from traditional

HRM
Traditional arrangements responsibility for
managing human resources lies with specialists
Strategic approach people management rests
with anyone who is in direct contact with workers
or line managers

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For years, HRM was not linked to corporate
profit
Organizations focused on current performance
HR managers did not have a strategic perspective
Executives categorized HRM in a traditional manner
It was hard to develop metrics for HRM activities

Recognizing the importance of people made

HRM
a major player in developing strategic plans
HRM strategies must reflect the organizations strategy regarding
people, profit, and effectiveness

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 Analyze/solve problems from a profit-
oriented point of view
Assess/interpret costs and benefits of HRM
issues
Use realistic, challenging, specific, and
meaningful goals in planning models
Prepare reports on HRM solutions to
problems
Train HR staff to emphasize importance of
profits

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 HRM actions,
language,
performance
Measured Communicated

Evaluated

The Era of Accountability

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HRM accountability resulted from:

Concerns about productivity

Organizational downsizing and redesign

Increasingly diverse workforce

Competitive need to use all

organizational resources

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Mission
Missionand
and Company
Company HRM
HRM
strategy
strategy structure
structure

Measure of Effectiveness

Influx/
Influx/
Reaching Using
Using
Reaching retention
retention
employees
employees
goals
goals ofgood
of good
efficiently
efficiently employees
employees

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 Changes in the
Coping With Change
environment are
often related to
changes in human Growing global competition
resources.
Rapidly expanding technologies
The HRM function
should provide for
Demand for individual, team, organizational competencies
or respond to these
changes
Faster cycle times

Increasing legal and compliance scrutiny

Higher customer expectations

Mechanized, routine work now knowledge-based

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 HRM Contributions to Effectiveness
Help the organization reach goals

Provide trained, motivated employees

Employ workforce skills/abilities efficiently

Increase satisfaction, self-actualization, quality of work life

Communicate HRM policies to all employees

Maintain ethical policies, socially responsible behavior

Manage change to the mutual advantage of individuals,

groups, the enterprise, and the public

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 Profitability gains
Higher stock prices
Company survival

Employees + Good Management = $

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 Reward good results

Dont reward non-performance

Make goals clear

Measure results clearly, fairly

Provide the right people

at the right time

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This job is matches
my skills perfectly

The company treats

me equitably

I find this job

very fulfilling

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 Management
Management
style
style
Meaningful
Meaningful Freedomand
Freedom and
tasks
tasks autonomy
autonomy

Quality of
Workworking
Work working Work Life Goodphysical
Good physical
hours
hours surrounds
surrounds

Jobsafety
Job safety

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 HRM policies, programs, and procedures must be
communicated fully and effectively
They must be represented to outsiders
Top-level managers must understand what
HRM can offer

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 Apply
Apply to
to all
all HRM
HRM activities
activities

Show
Showby
byexample
examplethat thatHRM
HRMactivities
activities
are
arefair,
fair,truthful,
truthful,honorable
honorable

Do
Donot
notdiscriminate
discriminate

Protect
Protectthe
thebasic
basicrights
rightsofof
employees
employees
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 Outsourcing Family
Telecommuting
HRM medical leave

Spouse
Child care relocation Pay for skills
assistance

Union- New lifestyles,

Benefit cost-
management aging
sharing
negotiation population

Trends and Changes

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 Causes
Causes of
of urgent,
urgent,
faster
faster management
management
behaviors
behaviors

Competition
Competition New
New opportunities
opportunities
New
New Technology
Technology

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 Shorter cycle times mean
less time to:
Increased
Train, educate, and assign
Increased
Emphasis
Emphasis managers
Solve sexual harassment
Customer complaints
Customer Training
Training and
and
Service
Service New education
education Recruit and select talented
New products
products
and services
and services people
Improve the firms image

Learning provides a
framework for decreasing
cycle time

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 Key Learning Areas

Leadership behaviors

Culture that rewards learning

Emphasis on working efficiently, quickly

Quicker, more flexible decision making

Empowerment

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Two groups normally perform HRM
activities:
HR manager-specialists
Operating managers

The effectiveness of the human resource

declines more quickly than all other
resources
An investment in people effects organizational
effectiveness more than money, materials, or
equipment

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Operating Managers HRM Specialist

Meetings Recruiting
Phone calls Selection
Problem solving Compensation
Training

Scheduling work HR departments typically

found in companies with
200+ employees

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Operating HRM
Managers Joint-decision Conflict Specialists
(line) (staff)

Discipline

Working conditions

Transfer or termination

Promotion

Employment planning

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Operating HRM
Managers Different Viewpoints Specialists
(line) (staff)

Employee authority over job

Labor relations

Organizational planning

Rewards

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 Inflexible

Over-attentive to detail

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 Sweeping
Sweeping
Demography
Demography business
business
changes
changes
Forces
Forces
impacting
impacting
roles
roles
Technology
Technology Globalization
Globalization

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 HR specialists are encouraged to

Analyze every activity and prove its value

Understand all aspects of the business

Become strategic partner with line managers

Seek out operating managers

Help managers avoid problems

Be flexible and open to ideas of others

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 HR must be proactive, integral part of
management and strategic planning

Ascertain company needs for its competence

Evaluate use & satisfaction among other departments

Educate everyone about HRM services

Have HRM strategic plans build on firms strengths

Develop competitive advantage over other firms

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To educate others about the HR implications of
decisions, HR executives must understand

Production Marketing R&D

Investments IT Advertising

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These must become so important and
effective that every unit in the firm knows
they are needed for success:
The compensation system
Training opportunities
Diversity management programs

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 Basis for Resource Allocation

Organizations internal strengths/weaknesses

Changes in the environment

Anticipated actions of competitors

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Average
Less than 150 people
HR Dept

Personnel Average = 1 specialist

Ratio per 100 employees

Less for construction, retail

agriculture, wholesale, services

More for public utilities, durable

goods manufacturing, banking,
Insurance, government

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 Typically
Typicallyreports
reportsto
tothe
the
ChiefHR
Chief HR
top
topmanager
manager
Executive
Executive
HRM
HRMand
andanother
anotherfunction
functionmay
may
Small/Medium
Small/Medium be
bein
inaasingle
singledepartment
department
Firms
Firms
HRM
HRMisistypically
typicallyaaunit
unitin
inthe
the
Nonprofits
Nonprofits business
businessoffice
office

HR specialists are usually located at

the headquarters of an organization

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A policy is a general guide that
expresses limits within which action
should occur
Arises from past or potential problems
Frees managers from making certain decisions
Ensures some consistency in behavior
Allows managers to concentrate on decisions
where they have the most experience and
knowledge

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Procedures (rules) are specific directions
In standard operating procedure (SOP) manuals
Helps ensure consistent decision making
Should be well-developed, but not excessive
Develop for only the most vital areas

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1-50
1. Describe the term human resource management.
2. Describe the strategic importance of human
resource management (HRM) activities performed
in operations.
3. Give examples of career opportunities are
available in the HRM field.
4. Compare the role that specialists and operating
managers play in performing HRM activities.
5. Summarize the main objectives pursued by HRM
units in organizations.

1-51