Chapter 2 – Human Resources Management

Human resource (workforce) planning

The management process of anticipating and determining current and future workforce needs.

Role of human resources

Ensuring that the business has the right employees at the right time and that they are working effectively.

Recruitment

The process of determining what job needs to be filled, what requirements are needed, and advertising the job.

Shortlisting

Using a computer to identify mismatches or errors in the recruitment process.

Training and development

The process of providing induction and ongoing training to employees.

Performance management and appraisals

Evaluating employee performance and making decisions regarding training, motivation, promotion, or termination.

Pay

The compensation provided to employees for their work.

Wellbeing

The overall health and satisfaction of employees in the workplace.

Workforce planning

Addressing short-term and long-term demands of the organization by employing workers to replace resigning or retiring staff.

Staff turnover

The rate at which employees leave the organization, which affects the need for recruitment and training.

Demographic changes of the labor force

Shifts in the composition of the workforce based on factors such as birth rate, migration rate, retirement age, and female participation.

Historical data

Analyzing past data to determine future workforce needs.

Flexibility and workload of employees

The ability of employees to adapt to changes in staffing needs and handle increased workloads.

Effects of poor HR

Negative consequences such as higher recruitment costs, lower morale, decreased productivity, and a negative corporate image.

Internal factors that influence HR planning

Factors within the organization, such as demographic changes and labor mobility.

Net migration rate

The difference between the number of people entering and leaving a country.

Part-time workers

Employees who work fewer hours than full-time employees, providing flexibility but potentially lower loyalty and motivation.

Migrant workers

Individuals who work outside their home country, contributing to the economic growth of the host country.

Pay and remuneration

Incentives offered by multinational corporations to attract migrant workers, such as better pay, relocation allowances, and subsidized housing.

External factors that influence HR planning

Factors outside the organization, such as cultural dimensions, employment opportunities, and societal tolerance for ambiguity.

Hoffstead's cultural dimensions

Factors that influence how individuals and societies perceive power distance, individualism vs collectivism, masculinity vs femininity, uncertainty avoidance, long-term vs short-term orientation, and indulgence.

Resistance to change in the workplace

Factors that contribute to employees being resistant to changes in the organization.1. Self-interest:Being more concerned with the implications for oneself rather than the benefits of change to the organization.

Perceived threat

Feeling a sense of insecurity about job security, status, or financial position due to change.

Low tolerance and inertia

Having a preference for familiarity and resistance to uncertainties that come with change.

Misinformation/misunderstandings

Lack of proper communication leading to confusion and incorrect understanding of the purpose of change.

Poor communication

Inadequate or ineffective communication about the change, leading to misunderstandings and resistance.

Disagreement about the need for change

Different assessments of the situation and conflicting opinions on whether change is necessary.

Kotter's six ways for reducing impact of change

Education and communication, participation and involvement, facilitation and support, negotiation and agreement, manipulation and co-option, explicit and implicit coercion.

Delegation

Entrusting staff to complete tasks or projects while the manager remains responsible for them.

Span of control

The number of workers directly under the authority of a manager, wider span of control means being responsible for more people.

Organizational structure

The way an organization is arranged, including layers of authority, chain of command, and bureaucracy.

Chain of command

The formal line of authority through which communications and orders are passed down in an organization.

Bureaucracy

An organizational structure characterized by prescribed rules, standardized procedures, and formal hierarchal structures.

Centralization

Decision making made by a small number of people without consulting others.

Decentralization

Sharing decision-making authority and responsibility with others.

De-layering

The process of removing one or more levels in the hierarchical structure to reduce the number of layers and widen the span of control.

Matrix structure

A flexible method of organizing employees from different departments to work together on a specific project.

Authority

Having the power to make decisions.

Responsibility

Being accountable for tasks or duties.

Accountability

Being held responsible or blamed when things go wrong.

Lewin's Force Field Analysis

A subjective tool used to evaluate change decisions by highlighting the biggest reasons for and against.

Orientations of Organizations

Different ways organizations specialize in their products.1. Duplicated functions:Functions that are repeated for each product, region, or specialized function.

Types of Organization Charts

Flat organizational structures have few layers of hierarchy and a short chain of command, while narrow, tall organizational structures have many layers of hierarchy and a long chain of command.

Management

The practice of planning, organizing, and coordinating resources to achieve organizational objectives. Managers are individuals with decision-making authority and responsibility for problem-solving to achieve specific organizational goals.

Functions of Management

Planning, organizing, commanding, monitoring and controlling, and coordinating. These functions involve setting objectives, giving instructions, monitoring performance, and ensuring departments work together efficiently.

Leadership

The act of influencing, inspiring, and motivating others to achieve organizational goals. Leaders focus on people rather than tasks and tend to have a long-term perspective and strategic objectives.

Part-time workers

Workers who do not receive full benefits and labor rights.

Senior managers

The highest-ranked managers who set and oversee long-term plans and strategies for the organization.

Middle managers

Managers who set departmental goals and strategies and have responsibility only for their department.

Supervising managers

Managers who monitor day-to-day tasks.

Official/formal leaders

Leaders within the organizational structure who have the authority to give orders.

Unofficial/informal leaders

Leaders who do not have the authority to give orders but have the power to influence others.

Styles of leadership

Autocratic, paternalistic, democratic, and laissez-faire. These styles differ in decision-making authority, involvement of employees, and level of freedom given to employees.1. Autonomy:Employees being given the freedom and independence to make decisions and take actions.

Decentralized structure

Organizational structure where decision-making authority is distributed among various levels and individuals within the organization.

Situational management

Adapting and applying different management styles based on the specific situation or context.

Laissez-faire approach

A hands-off management style where employees are given a high degree of freedom and autonomy.

Authoritarian approach

A management style where the leader exercises strict control and makes decisions without much input from employees.

Organizational culture

The values, beliefs, and behaviors that characterize an organization and influence its management style.

Human Resources Management

The function within an organization that focuses on managing and developing the organization's workforce.

Intrinsic motivation

Motivation that comes from within an individual, driven by personal satisfaction and enjoyment of the activity itself.

Extrinsic motivation

Motivation that comes from external factors, such as rewards, recognition, or punishments.

Taylor's theory

A management theory developed by Frederick Taylor that emphasizes scientific management and the division of labor to increase productivity.

Specialization

Focusing on a specific task or area of expertise to increase efficiency and productivity.

Maslow's hierarchy of needs

A theory by Abraham Maslow that categorizes human needs into a hierarchical structure, ranging from basic physiological needs to higher-level needs like self-esteem and self-actualization.

Hygiene needs

Factors in the workplace that, when absent, can cause dissatisfaction and demotivation, such as job security and physical working conditions.

Motivating factors

Factors in the workplace that, when present, can lead to job satisfaction and motivation, such as interesting tasks and opportunities for growth.

Herzberg's two-factor theory

A theory by Frederick Herzberg that distinguishes between hygiene needs and motivating factors in the workplace.1. Herzberg's theory:A theory that identifies two types of needs - hygiene needs and motivating factors - that affect employee motivation.

Maslow's hierarchy of needs

A theory that organizes human needs into a pyramid structure, with basic physiological needs at the bottom and higher-level needs such as social needs at the top.

Hygiene needs

Needs that are expected to be provided by the company and, if not met, can demotivate employees.

Motivating factors

Factors that employees work towards to work harder and are higher-level needs in the hierarchy of needs.

Flexible work patterns

Work schedules that offer employees more freedom and a better work/life balance.

Social needs

Needs for social interaction and connection with others, as per Maslow's hierarchy of needs.

Financial rewards

Methods used by businesses to motivate workers, often involving monetary payment or something of monetary value.

Salary

A fixed annual payment made to employees on a regular basis, typically used in professions where output or productivity is not easily measurable.

Wages

Payment for labor services expressed at an hourly rate (time) or as a measurable quantity of output (piece rate).

Piece rate

A payment system that rewards workers for each item they produce or sell within a specific time period.

Commission

A payment system that pays workers based on a percentage of sales they contribute.

Performance-related pay (PRP)

A system that rewards employees who meet certain goals or targets.

Profit-related pay

A system where employees receive a percentage of the company's profit if they meet objectives.1. Employee loyalty:The commitment and dedication of employees to their organization.

Team spirit

The sense of unity and cooperation among team members.

Motivation

The internal drive and desire to achieve goals and perform well.

Labor productivity

The measure of the amount of output produced per unit of labor input.

Conflict in the workplace

Disagreements or disputes between individuals or groups in the workplace.

Power distance

The extent to which power is distributed unequally in an organization.

Employee share ownership schemes

Programs that give employees shares of the company for free or at a discounted price.

Fringe payments/financial perks

Additional monetary benefits provided to employees, such as health insurance or housing allowance.

Job enrichment/vertical loading

Giving workers more challenging jobs with more responsibilities to enhance their psychological growth and commitment.

Job rotation

Systematically assigning employees to perform different tasks in a particular order or sequence.

Job enlargement/horizontal loading

Broadening the number of tasks that an employee performs without changing the nature of the job itself.

Empowerment

Granting workers the authority, skills, resources, and opportunities to achieve individual and organizational objectives.

Delegation

Managers passing on authority to their subordinates to take charge of a job role and gain recognition for their accomplishments.

Worker participation

Providing opportunities for employees to participate in decision making.

Training and development

Providing opportunities for staff to participate in training and development programs to enhance their skills and progress in their careers.

Purpose

The opportunity to make a difference and have a meaningful impact in one's role or job.

Philanthropy

The act of giving back to society or supporting charitable causes.

Teamwork

Employees working together with fellow colleagues to achieve common goals and build a sense of belonging.1. Training:The process of providing opportunities for workers to learn and acquire employment-related skills and knowledge.

Objectives of training

Enhance efficiency and productivity of employees, improve the quality of work, develop a more multi-skilled workforce, facilitate personal and professional development, and help employees adapt to change.

Benefits of training

Easier achievement of business objectives, improved competence leading to less waste and reworking, greater efficiency and productivity, higher morale, reduced absenteeism and staff turnover, improved opportunities for promotion, increased confidence and competence in job roles, better quality of output and customer service, and better adjustment to changes in internal/external environments.

Demonstration

Employee observing and learning about a specific task being carried out by an experienced member of staff.

Induction training

Training aimed at introducing new employees to the organization, helping them settle in quicker, avoid costly mistakes, integrate into the corporate culture, and establish clear expectations and good working habits.