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IE 001

Engineering
Management
Human
Resources
Management
HUMAN RESOURCES MANAGEMENT
INTENDED LEARNING OUTCOMES:
1. Explain the importance of the human resource
● how an organization’s human resources can be
a significant source of competitive advantage
● activities necessary for staffing the
organization and sustaining high employee
performance
2. Explain the importance of the human resource
management process and the environmental
factors that most directly affect it.
3. What is human resource planning
● Contrast job analysis, job description and job
specification
HUMAN RESOURCES MANAGEMENT

4. Staffing the organization


● Discuss the major sources of potential job
candidates
● Describe the different selection devices and
discuss which ones work best for different
jobs
● Explain what a realistic job preview is and why
it’s important
5. Orientation and Skill Development
● Describe the different types of training and
how that training can be provided
HUMAN RESOURCES MANAGEMENT

6. Managing and Rewarding Performance


● Describe the different performance appraisal
methods
7. Compensation and Benefits
● Discuss the factors that influence employee
compensation and benefits
● Describe skill-based pay systems
8. Career Development
● Describe career development for today’s
employees.
HUMAN RESOURCES MANAGEMENT

9. Current Issues in Human Resources


Management
● Explain how managers can manage
downsizing
● Discuss how managers can manage workforce
diversity
● Explain what sexual harassment is and what
managers need to know about it
● Describe how organizations are dealing with
work-life balances
HUMAN RESOURCES MANAGEMENT

The Importance of HRM


1. HRM is a necessary part of the organizing
function of management
- Selecting, training, & evaluating the workforce
2. It is an important strategic tool
- HRM helps establish an organization’s
sustainable competitive advantage.
3. It adds value to the firm
- High performance work practices lead to both
high individual and high organizational
performance.
HUMAN RESOURCES MANAGEMENT
Examples of High-Performance Work Practices
HUMAN RESOURCES MANAGEMENT

HRM for Non-HR Managers:


 Small vs. large organizations
● Large organizations have HR function
● Smaller organizations may rely on managers to
handle HR issues.
 All managers need to be aware of federal and
provincial legislation and company policies
● Minimum wage law
● Benefits mandatory provided by law to workers
such as SSS, Pag-ibig, Philhealth, vacation
leaves, sick leaves, etc.
HUMAN RESOURCES MANAGEMENT
The HRM Process:
HUMAN RESOURCES MANAGEMENT

Functions of the HRM Process:


1. Identifying and selecting competent employees
2. Providing employees with up-to-date knowledge
and skills to do their jobs
3. Ensuring that the organization retains competent
and high-performing employees
HUMAN RESOURCES MANAGEMENT

Environmental Factors Affecting HRM:


1. Labor Union
- An organization that represents workers and
seeks to protect their interests through
collective bargaining.

Collective Bargaining Agreement:


- A contractual agreement between an organization
and a union, covering wage, hours, and working
conditions of workers.
HUMAN RESOURCES MANAGEMENT
2. Legislation Affecting Workplace Conditions
● Canada Labor Code/Philippine Labor Code
● Occupational Health and Safety Act
● Workplace Hazardous Materials Information
System (WHMIS)
● Employment standards legislation
3. Antidiscrimination Legislation
● The Charter of Rights and Freedoms and the
Canadian Human Rights Act
● The Employment Equity Act
● Different laws prohibiting discrimination against
gender, age, disability, race, etc.
HUMAN RESOURCES MANAGEMENT
4. Economy’s Effect on the HRM Process
● lifetime employment is long gone and corporate
pension plans are crumbling
● the jobless rate will continue to increase in
most European countries
● reduced work hours, which affected employees’
pay and their skill upgrades
● temporary or contract positions, rather than full
-time jobs with benefits
HUMAN RESOURCES MANAGEMENT
5. Demographic trends
 Four generations working side-by-side in the
workplace:
● the oldest, most experienced workers (those
born before 1946) make up 6 percent of the
workforce
● the baby boomers (those born between 1946
and 1964) make up 41.5 percent of the
workforce
● Gen Xers (those born 1965 to 1977) make up
almost 29 percent of the workforce
● Gen Yers (those born 1978 to 1994) make up
almost 24 percent of the workforce
THE HRM PROCESS
I. Human Resource (HR) Planning:
- the process by which managers ensure that they
have the right number and kinds of people in the
right places, and at the right times, who are
capable of effectively and efficiently performing
their tasks.
- helps avoid sudden talent shortages & surpluses.

Steps in HR Planning:
1. Assessing current human resources
2. Assessing future needs for human resources and
developing a program to meet those future
needs
THE HRM PROCESS

1. Human Resources Inventory:


- A review of the current makeup of the
organization’s resources/employees status which
usually includes information on employees such
as name, education, training, prior employment,
languages spoken, special capabilities, and
specialized skills.

HR Management Information Systems (HRMIS):


- A database that tracks employees’ information for
policy and strategic needs.
THE HRM PROCESS

Job Analysis:
- an assessment that defines a job and the
behaviors necessary to perform the job;
knowledge, skills, and abilities
- requires conducting interviews, engaging in direct
observation, and collecting the self-reports of
employees and their managers
THE HRM PROCESS

Job Description:
- a written statement of what the jobholder does,
how it is done, and why it is done.

Job Specification:
- a written statement of the minimum qualifications
that a person must possess to perform a given
job successfully.
THE HRM PROCESS

2. Meeting Future HR Needs


- future HR needs are determined by the
organization’s mission, goals, and strategies.
- demand for employees results from demand for
the organization’s products or services.
- after assessing both current capabilities and
future needs, managers can estimate areas in
which the organization will be understaffed or
overstaffed.
THE HRM PROCESS
Meeting Future HR Needs:
THE HRM PROCESS
II. Staffing the Organization:
 Recruitment
- the process of locating, identifying, & attracting
capable applicants to an organization
● E-recruiting
- recruitment of employees through the Internet,
organizational web sites, online recruiters.
 Decruitment
- the process of reducing a surplus of employees
in the workforce of an organization (includes
firing, layoffs, attrition, transfers, reduced
workweeks, early retirements, & job sharing)
THE HRM PROCESS
Major Sources of Potential Job Candidates:
THE HRM PROCESS
Decruitment Options:
THE HRM PROCESS
III. Selection Process
- is the process of screening job applicants to
ensure that the most appropriate candidates are
hired.
Selection:
- is an exercise in predicting which applicants, if
hired, will be (or will not be) successful in
performing well on the criteria the organization
uses to evaluate performance
Selection errors:
● Reject errors for potentially successful applicants
● Accept errors for ultimately poor performers
THE HRM PROCESS
Selection Decision Outcomes:
THE HRM PROCESS
Validity & Reliability:
 Validity (of Prediction)
● A proven relationship between the selection
device used and some relevant criterion for
successful performance in an organization.
- High test scores equate to high job performance;
low scores to poor performance
 Reliability (of Prediction)
● The degree of consistency with which a
selection device measures the same thing
- Individual test scores obtained with a selection
device are consistent over multiple testing
instances
THE HRM PROCESS

Types of Selection Devices:


● Application Forms
● Written Tests
● Performance Simulations
● Interviews
● Background Investigations
● Physical Examinations
THE HRM PROCESS
THE HRM PROCESS

Written Tests:
 Types of Tests
● Intelligence: how smart are you?
● Aptitude: can you learn to do it?
● Ability: can you do it?
● Interest: do you want to do it?
THE HRM PROCESS

Performance Simulation Tests:


- Testing an applicant’s ability to perform actual
job behaviors, use required skills, and
demonstrate specific knowledge of the job.
● Work sampling
Requiring applicants to actually perform a task
or set of tasks that are central to successful
job performance
● Assessment centres
Dedicated facilities in which job candidates
undergo a series of performance simulation
tests to evaluate their managerial potential
THE HRM PROCESS

Situational Interviews:
- Interviews in which candidates are evaluated on
how well they handle role play in mock scenarios

Background Investigations:
- Verification of application data
- Reference checks
● Lack validity because self-selection of
references ensures only positive outcomes

Physical Examinations:
- Useful for physical requirements
THE HRM PROCESS

Realistic Job Interviews:


- The process of relating to an applicant both the
positive and the negative aspects of the job.
●Encourages mismatched applicants to withdraw
● Aligns successful applicants’ expectations with
actual job conditions, reducing turnover
THE HRM PROCESS
Tips for Managers:
Some Suggestions for Interviewing
● Structure a fixed set of questions for all applicants.
● Have detailed information about the job for which applicants
are interviewing.
● Minimize any prior knowledge of applicants’ background,
experience, interests, test scores, or other
characteristics.
● Ask behavioural questions that require applicants to give
detailed accounts of actual job behaviours.
● Use a standardized evaluation form.
● Take notes during the interview.
● Avoid short interviews that encourage premature decision
making.
THE HRM PROCESS
Questions Not to Ask Job Candidates:
● About name changes; maiden name
● For birth certificate, baptismal records, or about age in general
● About pregnancy, child bearing plans, or child care arrangements
● Whether applicant is single, married, divorced, engaged,
separated, widowed, or living common-law
● About birthplace, nationality of ancestors, spouse or other relatives
● Whether born in Canada
● For photo to be attached to application or sent to interviewer before
interview
● About religious affiliation, church membership, frequency of church
attendance
● Whether the applicant drinks or uses drugs
● Whether the applicant has ever been convicted
● Whether the applicant has ever been arrested
● Whether the applicant has a criminal record
● About the applicant’s sexual orientation
THE HRM PROCESS
Quality of Selection Devices as Predictors
THE HRM PROCESS
IV. Orientation
● Work-unit orientation
- Familiarizes new employee with work-unit
goals
- Clarifies how his or her job contributes to unit
goals
- Introduces employee to his or her co-workers
● Organization orientation
- Informs new employee about the
organization’s objectives, history, philosophy,
procedures, and rules
- Includes a tour of the entire facility
THE HRM PROCESS
IV. Orientation
- the introduction of a new employee into his/her
job and the organization.
Two types of orientation:
● Work-unit orientation
- Familiarizes new employee with work-unit goals
- Clarifies how his or her job contributes to unit goals
- Introduces employee to his or her co-workers
● Organization orientation
- Informs new employee about the organization’s
objectives, history, philosophy, procedures, and
rules
- Includes a tour of the entire facility
THE HRM PROCESS
V. Training
- An organized activity aimed at imparting
information and/or instructions to improve the
recipient's performance or to help him or her
attain a required level of knowledge or skill.
Types of Training:
● Interpersonal skills ● Technical skills
● Business skills ● Mandatory skills
● Performance management skills
● Problem solving/decision making skills
● Personal skills
THE HRM PROCESS
Employee Training Methods
THE HRM PROCESS
Occupations of Employees Who Receive
Training
THE HRM PROCESS
How Employees Train Themselves
THE HRM PROCESS
VI. Performance Management System:
- A process establishing performance standards
and appraising employee performance in order to
arrive at objective HR decisions and to provide
documentation in support of those decisions.
THE HRM PROCESS
Performance Appraisal Methods:
● Written Essays
● Critical Incidents
● Graphic Rating Scales
● Behaviourally Anchored Rating Scales (BARS)
● Multi-person Comparisons
● Management by Objectives (MBO)
● 360-Degree Feedback
THE HRM PROCESS
Advantages and Disadvantages of
Performance Appraisal Methods
THE HRM PROCESS
VII. Compensation & Benefits
● Benefits of a Fair, Effective, and Appropriate
Compensation System
- helps attract and retain high-performance
employees
- impacts on the strategic performance of the firm
● Types of Compensation
- Base wage or salary
- Wage and salary add-ons
- Incentive payments
- Skill-based pay
THE HRM PROCESS

● Base wage or salary


- is a fixed amount of money paid to an employee
by an employer in return for work performed and
does not include benefits, bonuses or any other
potential compensation.

● Wage & salary add-ons


- includes the employee’s base wage or salary
plus overtime pay, night shift differentials, working
on weekends/holidays, on call pay, etc.
THE HRM PROCESS

● Incentive payment
- is a monetary gift provided to an employee
based on performance, which is thought of as one
way to entice the employee to continue delivering
positive results. It may come in the form of bonus,
profit sharing or commission.

● Skill-based pay
- rewards employees for the job skills and
competencies they can demonstrate. Under this
type of pay system, an employee’s job title doesn’t
define his/her pay category, skills do.
THE HRM PROCESS

● Variable pay
- a pay system in which an individual’s
compensation is contingent on performance. It is
something that is a part of an employee’s salary
which depends on the employee’s and companies
performance.
THE HRM PROCESS
Factors that Influence Compensation & Benefits:
THE HRM PROCESS
VIII. Career Development
● What is a career?
- a sequence of positions held by a person during
his or her lifetime.
● Career Development
- Provides for information, assessment, & training
- Helps attract and retain highly talented people
● Boundaryless Career
- A career in which individuals, not organizations,
define career progression, organizational
loyalty, important skills, and marketplace
value.
THE HRM PROCESS
Top Ten (10) Job Factors for College Graduates:
1. Enjoying what they do
2. Opportunity to use skills and abilities
3. Opportunity for personal development
4. Feeling what they do matters
5. Benefits
6. Recognition for good performance
7. Friendly co-workers
8. Job location
9. Lots of money
10. Working on teams
THE HRM PROCESS
CONTEMPORARY ISSUES IN HRM
Contemporary Issues in Managing Human
Resources:
1. Managing downsizing
- is the planned elimination of jobs in an
organization which can be due to the need to
cut costs, declining market share,
overaggressive organizational growth.
● Provide open and honest communication
● Reassure survivors
CONTEMPORARY ISSUES IN HRM
2. Managing workforce diversity
- workforce diversity refers to the variety of
differences between people in an
organization. It encompasses race, gender,
ethnic group, age, personality, cognitive style,
tenure, organizational function, education,
background, etc.
● Recruitment for diversity
● Selection without
discrimination
● Orientation and training
that is effective
CONTEMPORARY ISSUES IN HRM
3. Sexual Harassment
- defined as any unwanted action or activity of a
sexual nature that explicitly or implicitly
affects an individual’s employment,
performance, or work environment.
- the Equal Employment Opportunity Commission
(EEOC) defines sexual harassment as the
behaviour marked by sexually aggressive
remarks, unwanted touching and sexual
advances, requests for sexual favours, or
other verbal or physical conduct of a sexual
nature, which can occur between members of
the opposite sex or of the same sex.
CONTEMPORARY ISSUES IN HRM
● Educate all employees on sexual harassment
matters
● The key is being attuned to what makes fellow
employees uncomfortable—and if you don’t
know, then you should ask.
Workplace Romances:
● Educate employees about the potential for
sexual harassment when coworkers stop
dating
● Discourage workplace romances and require
supervisors to report any such relationships
to the HR department
CONTEMPORARY ISSUES IN HRM
4. Work-Life Balance
- Employees have personal lives that they don’t
leave behind when they come to work.
- Organizations have become more attuned to
their employees by offering family-friendly
benefits such as:
● On-site child care
● Summer day camps
● Flextime
● Job sharing
● Leave for personal matters
● Flexible job hours

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