SESSIONS 1 & 2 - HIRING

'Don't go into HR because you like to work with

people'

HUMAN RESOURCE
PLANNING
3

Which function is of the highest Importance?

Price

Quality

Company Strategy

Innovation

Employees

Brand

Design

HR Strategy

Key- and Bottleneck-Functions

Low

Talent
Availability

High
Low

Strategic
Relevance

High

Source: Trost, A. (2012). Talent Relationship Management. Personalgewinnung in

Zeiten des Fachkrftemangels. Heidelberg: Springer.
5

Quantitative Workforce Planning Methods

Conclusion by Analogy
Task Analysis
Leading Indicators
Ratios
Trend Analysis
Based on past trends

RECRUITMENT

Product Brand versus Employer Attributes

Product

Function

Prestige

Innovation

Employer

Company

Prize

Quality

Design

Products

Tasks

Offers

Values

People

According: Corporate Leadership Council (1999). The

Employment Brand. Washington: The Corporate Executive
Board.
9

10

Building an Employer Brand

Target Group Definition

Operation

Analysis

Creative Formats, Rules

& Processes, Validation,
Campaigns

Employer Image,
Target Group Preferences,
Employer Stengths,
Labour Competition

Strategy
Employee Value
Proposition (EVP),
Media strategy
Source: Trost, A. (Hrsg.) (2009). Employer Branding. Arbeitgeber positionieren und
prsentieren. Kln: Luchterhand.
11

Potential Employee Value Propositions

Offers

Tasks

Company

People

Values

Purpose

Compensation

Attractive tasks
& projects

Products/
Services

Peoples
Personality

Company
culture

Environment &
Climate

International
work

Technology
leader

Leadership
quality

Social
responsibility

Innovation

Market leader

Qualification
level of
workforce

Famous leader

Impact

Success

Health of
others

Benefits
Career
opportunities
Work-LifeBalance

Location

Collaboration
Diversity

Public
reputation

Trust &
Respect

Quality of live

Work flexibility

Security
Customers

Source: Trost, A. (Hrsg.) (2009). Employer Branding. Arbeitgeber positionieren und

prsentieren. Kln: Luchterhand.
12

Defining the Employee Value Proposition

Employer
Strengths

Target Group
Preferences

Competitors
Strengths

EVP
Employee Value
Proposition

authentic

relevant

E
different

Source: Trost, A. (Hrsg.) (2009). Employer Branding. Arbeitgeber positionieren und

prsentieren. Kln: Luchterhand.
13

ACTIVE RECRUITING

14

Categorization of candidates

Candidate
Active seeker

Recruitment
Passive

Passive candidate

Active

Non-seeker

15

Social Networks Referal programs

A player knows A player

16

SELECTION

17

THIS IS NO PICNIC!
Working and Living conditions on this job are as difficult as
those encountered on any construction job ever done in the
United States or foreign territory. Men hired for this job will be
required to work and live under the most extreme conditions
imaginable. Temperature will range from 90 above zero to 70
below zero. Men will have to fight swamps, rivers, ice and
cold. Mosquitos, flies, and gnats will not only be annoying but
will cause bodily harm.
If you are not prepared to work under these and similar
conditions, DO NOT APPLY.
June 15, 1942

Bechtel - Price - Callahan

Realistic job previews

18

How many applications are ideal for one position?

23 Lakh Applications For 368 Peons Job In UP:
Engineers And Doctorates Among Applicants
2 lakh graduates
255 PhDs

Job requirements
5th pass, bicycle riding (exempt for girls and PH)
53,000

Selection process Interview

Hiring costs

19

20

Recruitment at Berge Tattoo

21

Court OKs Barring High IQs for Cops

Rejected for high IQ
33 points
Why?
Required IQ: 20-27

22

Ernst & Young Removes College Grades As

Criteria For Recruitment
http://www.scoopwhoop.com/news/eny-remove-degreecriteria/?ref=social&type=fb&b=0

Job requirement and grades

Are grades a good predictor of success in the job?

Qualitative: Right criteria

Quantitative: Right level of criteria

23

Content and Purpose of Job Analysis

Magic
Moments

Employee
Value
Proposition

Attractive
Aspects
Job
Description

Critical
Incidents

Requirements

Selection
Criteria

Job Analysis

24

Prediction vs. Actual

High

Actual
Performance

Low

Low

False
Negative

Right
Positive

Right
Negative

False
Positive

Predicted
Performance

High

25

Prediction and decisions

Information Analysis Predict Future
performance Decision
Assumptions
Require decisions

Type I and Type II errors

Cost

26

Which error do you want to minimize?

Costs
Bottleneck function
Key function
Level
Culture
Strong
Perform or perish

Layoffs

27

Case SG Cowens
Hiring process
Target schools

Why was the choice of schools of such importance?

What do you make of core school strategy?
Should start-ups go to non IIT/IIMs?
Should Cowens recruit non-MBAs?

28

Target schools
Information asymmetry
Use of Signals
What makes a good signal
Signal for performance on the job?
Investment bank vs. Startups

Signal for reputations?

Investment bank vs. Startups

Hiring Non-MBAs and signals

Engineers and IT industry

29

On campus
What were the strengths and weaknesses of the
screening method?
Screening
Information deprivation vs. Realistic job previews

How effective was the division of labor between

senior bankers and associates

30

Super Saturday
What objectives does this serve?
What were the possible tensions between
evaluation and recruiting?
What kind of information was collected?
Hiring for fit?

What is your overall impression of the system?

Did they collect enough information?

31

Interviews
Can this unsystematic and unstructured
approach produce useful information?
Why do practitioners use unstructured
interviews?
Getting through coached answers

32

Potential Biases in interviews

Form a holistic pictures from limited information
Construct social reality Reduce complexity - focus
Irrational beings
11 seconds on average to look at resumes

First Impression
Recency Effect
Projection
Stereotyping
Contrast effect

Halo effect

Statistics and assumptions

33

Selection methods

Candidate dimensions
Knowledge

Methods to test
CV, grades and Interviews

Skills

CV, past experience, task

based tests

Abilities/Competencies

Attitudes/Values

Psychometric tests,
Assessment centers
Interviews, Assessment
centers

34

Which two candidates will you select and why?

Natalya Godlewska
Martin Street
Ken Goldstein
Andy Sanchez

35

Validity, Objectivity, Reliability

Validity
The extent to which results of an assessment method
relate to what it is supposed to measure
Reliability
The extent to which a predictor repeatedly produces
the same results over time
Objectivity
Multiple rater independently produce the same results
in terms of execution, analysis and interpretation

36

37

Pedigree: Evaluation of candidates for Elite

professional firms
Interviewers consider four subjective themes.

1. Does the candidate show leadership through extracurricular activities

(captains of sports teams are great)?
2. Does the candidate have presence (Could I put them in front of a
client?)?
3. Do they have basic technical knowledge (Common sensenot
necessarily the smartest)?
4. Do they fit (Do I want to play with them)? Hiring, is like picking a
team on the playground growing up.
Candidates ideal answers to interview questions do not reflect the values
of the company so much as shared play styles, and the process allows
for significant socio-economic, and personal, bias.

38

Assessment Center

Candidates

6-15
candidates

Assessors

Well-trained
psychologists
and
managers

Criteria

Intelligence,
social
competence,
mobility
...

Methods

Tests,
groupexercises,
Interviews,
...

Situations

In-tray,
presentation,
Role play,
...

Source: Trost, A. (2012). Talent Relationship Management. Personalgewinnung in

Zeiten des Fachkrftemangels. Heidelberg: Springer.
39

SESSION 3 & 4
PERFORMANCE
APPRAISAL
40

Performance Management Cycle

Superior Objectives

Why?
Experiences?

Performance
Appraisal

Objective
Setting

Good/bad

Mid-Year Review

41

Agency theory
Principal-agent problem
Self interest and opportunism
Alignment of interests
Incentives

Information asymmetry
Monitoring costs

42

Case discussion - Vitality

Salary determination at vitality
Salary line and compa-ratio
Comparison with market

43

Development of a Base Pay System

Job Analysis

Job Evaluation

Pay Policies

Pay Survey

Pay Structures

According: Mathis & Jackson: Human Resource Management. South-Western.

44

Compensable Factors Hay System

Knowledge

Functional Expertise

Managerial Skills

Human Relation

Environment

Challenge

Freedom to act

Impact on end results

Magnitude

Dyn.

Problem Solving

Accountability

Source: Trost, A. (2012). Talent Relationship Management. Personalgewinnung in

Zeiten des Fachkrftemangels. Heidelberg: Springer.
45

Market Line
Market Pay

Vitality vs.
Market

Average Salaries in the Market

Benchmark-Jobs

Market
Line

Job Value

46

Equity

Reward

Internal Equity
A

External Equity
Equity
B

Performance/
Contribution to company success

47

Performance management
What were the problems and their causes?
Substantiate through data

Performance identification
Why do managers not do a good job?

48

Compensation - Reward distribution

Tighter link between pay and performance
Explained pay dispersion
Incentive effect
Monetary motivation

Sorting effect
Self selection
Poor performers quit
Good performers attracted and retained

Higher sense of equity

49

Forced ranking
Relative grading
Team work

Collaboration vs. Competition

Task interdependency
Accountability problem
Sabotage
Collusion
Small teams vs. large teams
Distribution
Sabotage

Distribution does not reflect reality

50

Recap
Two distinct but interrelated problems
Performance identification
Performance related pay - Reward distribution

51

Relative grading vs. Absolute

Absolute vs. Relative
External noise

Team work
Collaboration vs. Competition
Sabotage, Collusion

Task interdependency
Accountability problem
If you could reliably measure and reward individual
contributions, organizations would not be needed

Small teams vs. large teams

Distribution, sabotage

Forced distribution
Differentiation different from identification
Sorting (Forced selection)
GE, Microsoft
52

Performance measurement
External rewards create their own problems
Tunneling effect
Difficult to give feedback
Coaching vs. Judging

Crowding out
Video and discussion

Pay based on group performance

Infosys
Social loafing?
Culture
Peer pressure
Self regulating adults

53

Critique of traditional PMS

Most merit-pay systems share two attributes: they absorb
vast amounts of management time and make everybody
unhappy

A 2013 survey or HR professionals

Quality of their own PM systems
only 23 percent said their company was above
average

90 percent of HR heads believe PMS does not

yield accurate information (CEB)
95 percent of managers are dissatisfied (CEB)

54

Why performance management system?

Delink pay and performance management?
Why?
Feedback vs. Pay
Performance related pay effects on coaching
Vitality - Difficult to give feedback

Defensive
Coaching vs. Judging

Doing away with annual reviews

Deloitte reading
Accenture, Infosys

55

Why performance appraisal?

Control or accountability
Employee development
Abilities & Opportunities
Employee motivation

Legal obligation
Why did you take a disciplinary action?

Validation of other HR practices

Recruitment, selection, compensation, T&D

56

Why performance appraisal?

Judging vs Coaching
Defensive
Use of rating systems
Video

Doing away with annual reviews

Accenture, Infosys, TCS
Deloitte reading

Employee motivation
Reading

57

Accountability vs. Development

Judging vs Coaching
Assumptions
People are not malleable
People are malleable

58

SESSION 5 & 6:
PERFORMANCE
MEASUREMENT
59

Traditional performance management Cycle

Superior Objectives

Performance
Appraisal

Objective
Setting

Mid-Year Review

60

CITIBANK

61

Balanced scorecard
https://hbr.org/video/3633937148001/theexplainer-the-balanced-scorecard

62

Citibank
Strategy?
What vs. How?
Now vs. Future

Why non-financials?

63

Citibank
How does McGaran fare on each dimension?
How are the dimensions measured?
What do you recommend for McGaran?

64

Citibank
Customer satisfaction?
Why?
Leading/Lagging?
Reliable?

Target setting

65

Citibank
Overall rating for McGaran?
Flexibility issues
Rigidity benefits

Subjectivity issues
Objectivity benefits

66

PERFORMANCE
MEASUREMENT EXERCISE
67

Three phases
Decide what you want to measure.
Gather performance data
Interpret the data you collected.

68

Decide what to measure

Define your objectives
Define critical success factors (CSFs)
Define performance metrics

69

Define objectives
Aligned - Downward cascading
What must our group do to help carry out our
company's strategy?
How might we better serve our customers?
How might we improve our work processes?
What new skills or knowledge do we need to
excel?

70

CSF and KPI

CSF
A key activity needed to achieve a given strategic
objective.

KPI

A measure reflecting a CSF

Process KPIs
Input KPIs
Output KPIs

71

Tips for performance metrics

Start with your objectives and critical success
factors.
Look beyond financial measures.
Identify cause-and-effect linkages.
Examine your lagging/leading mix.
Strive for a balance of subjective and objective
metrics.
Consider availability, validity, and reliability of
data.
Use clear, accessible language.

72

Balance is key

Financial
performance
Revenues, Profits

Internal data
Process quality

Lagging
Sales

Subjective
Employee
capabilities

Nonfinancial
Employee
knowledge

External data
Third-party
rankings

Leading
Customer
satisfaction

Objective
Revenues
73

Gather performance data

Set targets for each metric
Targets represent the performance you want to see on
each of your metrics.

Collect performance data

74

Tips to set targets

Establish a three-point range of targets for your
metrics
Minimum, Moderate, Stretch

Involve your employees. .

Consider trends to establish a target baseline
Get boss's input.
Use SWOT analysis
Get feedback from customers and other
stakeholders.
Consider industry averages.
Identify initiatives
75

Consider the source

Where will you get the needed data?
How will you gather subjective data?
Should you use composite data?
Will your data be reliable?

76

Interpret performance data

Analyze performance data
Analyze
Compare the actual with set

Test your measurement system

77

Guidelines for interpreting performance data

Looking for trends
Considering the inherent variability in the
process being measured
Thinking about what's causing any variations in
the data
Asking whether your targets or metrics need to
be changed

78

Brainstorming exercise
Identify the most important five objectives
Decide critical success factors
Define performance metrics
Set targets for each metric

79

SUMMARY

80

Performance Measurement
Define your group's objectives.
Define critical success factors for each objective.
Translate critical success factors into
performance metrics.
Set targets for your performance metrics.
Collect performance data.
Analyze performance data.
Test your measurement system

81

SESSION 7:
COMPENSATION
82

Total Reward
Total Reward
Total Compensation

Base Pay

Variable Pay
Individual/
Group

Organisation

Salary

Piece Rate

Profit
Sharing

Wages

One-time
Bonus

Stock
Ownership

Non-financial
Reward
Benefits

Insurances

Contacts
Pension

Target Bonus
Commission

Appreciation

Privileges
Stock
Options

Services

Title

According: Holtbrgge, D. (2004). Personalmanagement. Heidelberg: Springer.

83

Case discussion - R&R strategy

What is R&R strategy?
Differentiate from competitors

What are the critical performance variables for

R&R?
Cascading critical performance variables to
lower levels
How do you evaluate at individual and team level?

How do you measure them?

Customer service?
The ratings game

THE BEST WAY TO BEHAVE IS LIKE A

SERVANT

84

The customer-rating game

RATING SYSTEMS HAVE TURNED CUSTOMERS
INTO UNWITTING AND SOMETIMES
UNWITTINGLY RUTHLESS MIDDLE MANAGERS
CUSTOMERS EXPECT RITZ CARLTON SERVICE
AT MCDONALD'S PRICES.
ITS A STRANGE AMOUNT OF POWER FOR
CUSTOMERS TO HOLD
YOURE IN A STATE OF NEUROTIC ANXIOUS
TERROR OF MAKING THE TINIEST SLIP UP.

'I WONT LET THEM BRING ALCOHOL IN MY CAR

AND YOURE FIRING ME?
IN RATING SYSTEMS, THE CUSTOMER IS
LITERALLY ALWAYS RIGHT

85

Outcome vs. Process variables

Outcome
Numbers

Process
Dilution of brand
False promises
Promote particular products more

How do you evaluate process adherence?

Subjective vs. Objective?
Identifiable and visible

Inputs
Efficiency measures
Sales per hour (SPH)

86

Pay for performance

Equity
Sorting
Incentive

87

Performance measurement
Imperfect
If you could reliably measure and reward individual
contributions, organizations would not be needed

88

Pay Broader vs. Narrow measures

Stock price
Firm-wide accounting profits
Divisional accounting profits
Department profit center
Group performance
Individual performance

Broader

Narrow

Controllability

Larger

Smaller

Alignment

Less severe

More severe

Interdependency Less severe

More severe

89

Pay - Performance measurement

Controllability, noise
Controllable vs. influenceable
Risky incomes

Alignment, distortion
Completeness
Tunneling effect

Interdependency
Cooperation vs. Free riding
Wipro, Infosys

Controllability vs. Alignment

Controllable vs. complete

Controllability vs. Interdependency

90

Subjective vs. Objective Evaluation

Overcome distortions of objective
Reliability issues
Politics
Experience, Expertise, Authority
Perception of fairness

91

Pay for performance

Crowding out
Competition
Lack of cooperation

The moment you choose to manage by a metric you

invite your managers to manipulate it
Rewards motivate, but they also motivate wrong
behavior.
Most merit-pay systems share two attributes: they absorb
vast amounts of management time and make everybody
unhappy

92

Employee stocks
Employee stock ownership plans
Employee stock options
Why?
Costs
Risk sharing
Retention

93

Session 8

Balance of power
Who has more power?
Employee, Employer

What are the sources of power?

Employee, Employer

Generic vs. Specific

Manufacturing
Chaplin video

Bargaining power?
Collective bargaining

95

Violence in the Indian Manufacturing sector

Workers get more militant as space for
unionization shrinks
Union leaders burnt to death

Maruti, Honda motors, Hero Honda, Pricol, and

several others
Delhi-Haryana belt

Violence an outlet for wide scale dissatisfaction

Repressed collective bargaining

Unions, are they good for employers?

96

TCS CASE

97

Discuss the following in groups

Understand the following terms and categorize them into distinct groups
Layoff
Performance related restructuring
Workforce optimization
Workforce restructuring
Termination
Dismissal
Which term better explains the events in the TCS case?
From the groups perspective
From TCS perspective
From FITE perspective
From the perspective of employees who were forced to leave TCS
From the perspective of TCS employees who survived the event
What could be the consequences of dismissal? What are the consequences of layoff?
What are the consequences when a dismissal is confused for a layoff and vice versa?
To the employees who were forced to leave TCS
To the employees who survived
To TCS
Which other set of actors do you think can/will be involved in the whole case? How
would they react to layoffs vs. dismissals?

98

Change in the Indian IT industry structure

Source: CRISIL research report

99

Source: Economic Times article

100

Layoffs
Business wise
LIFO
Seniority
Performance
Identification imperfect
Past performance > Future performance

101

Legal
Termination during pregnancy
IT employee as a workman
http://www.financialexpress.com/article/industry/jobs/p
erson-working-in-an-it-firm-is-a-workman-ruleschennai-court/252258/?SocialMedia

Form Unions
TN Govt. Order

102

How do you handle poor performers?

Identity poor performers
Provide candid feedback regularly
Put on performance improvement program
Hold managers accountable
Provide generous separation support

103