MAN3025 Module 8: Human Resources Management

human resource management (HRM)

The process of planning for, attracting, developing, and retaining an effective workforce

5 Human Resource Practices

1. Recruitment and selection

2. Compensation and benefits

3. Onboarding and L&D

4. Performance management

5. Employee relations

strategic human resource management

The process of designing and implementing systems of policies and practices that align an organization’s human capital with its strategic objectives

HRM vs. Strategic HRM

HRM is about managing people

Strategic HRM is about generating competitive advantages through people

internal fit

When all of the organization’s HR policies and practices reinforce one another

external fit

When the organization’s HR system as a whole aligns with its culture and structure in a way that supports firm-level strategy

human capital

The economic or productive potential of employee knowledge, experience, and actions

social capital

The economic of productive potential of strong, trusting, and cooperative relationships

Strategic HRM approaches

1. Talent management

2. High-performance work systems

talent management

strategic HRM approach that matches high-potential employees with an organization’s most strategically valuable positions

high-performance work system (HPWS)

strategic HRM approach that deploys bundles of internally consistent HR practices in order to improve employee ability, motivation, and opportunities across the organization

recruiting

The process of locating and attracting qualified applicants for job openingsin

internal recruiting

Hiring from the inside, or making people already employed by the organization aware of job openings

external recruiting

Attracting job applicants from outside the organization

talent marketplaces

Digital platforms that use AI to match existing employees with job openings, training opportunities, and mentoring relationships

employee referrals

Tap into existing employees’ social networks to fill open positions with outside applicants

boomerangs

Former employees who return to the organization

person-job fit

Extent to which a worker’s competencies and needs match a specific job

selection

The process of screening job applicants and choosing the best candidate for a position

legal defensibility

The extent to which the selection device measures job-related criteria in a bias free way

reliability

Represents the degree to which a test produces consistent scores

validity

Reflects the degree to which a test measures what it’s supposed to measure

unstructured interviews

Gather information about job candidates without the use of a fixed set of questions or a systematic scoring procedure

structured interview

Asking each applicant the same questions and comparing their responses to a standardized set of answers

situational interviews

Type of structured interview where applicants are asked how they would behave in hypothetical job situations

behavioral-description interviews

Type of structured interview where applicants are asked about how they have behaved in the past

employment tests

Standardized devices organizations use to measure specific skills, abilities, traits, and other tendencies

The 6 Employment Tests

1. Ability tests

2. Performance or job skills tests

3. Personality tests

4. Integrity tests

5. Drug and alcohol tests

6. Criminal and financial background checks

compensation

Payment comprised of three components: wages or salaries, incentives, and benefits

base pay

The basic wage of salary paid to employees in exchange for doing their jobs

incentives

Commissions, bonuses, profit-sharing plans, and stock options

benefits

Additional nonmonetary forms of compensation, like health insurance, retirement, and family leave

onboarding

Programs designed to integrate and transition employees into new jobs and organizations by familiarizing them with corporate policies, procedures, and politics, and clarification of work-role expectations and responsibilities

learning and development (L&D)

Fills gaps between what employees know and what they need to know

5 Steps in the L&D Process

1. Assessment

2. Objectives

3. Selection

4. Implementation

5. Evaluation

performance management

A set of processes and managerial behaviors that involve defining, monitoring, measuring, evaluating, and providing consequences for performance expectations

4 Steps of Performance Management

1. Define performance

2. Monitor and evaluate performance

3. Review performance

4. Provide consequences

performance appraisal (review)

Management process that consists of assessing employees’ performance and providing them feedback

objective appraisal

Also called results appraisals; based on facts and are often numerical

subjective appraisal

Based on a manager’s perceptions of an employee’s traits or behaviors

behaviorally anchored rating scale (BARS)

Rates employee gradations in performance according to scales of specific behaviors

360-degree assessment/feedback appraisal

Employees are appraised by not only their managerial superiors but also by peers, subordinates, and clients

forced ranking performance review systems

All employees in a business unit are ranked against one another and grades are distributed along a bell curve

performance improvement plans (PIPs)

Formal policies of progressive discipline that outline employee performance problems, routes to and timelines for improvement, and consequences for not meeting plan objectives

layoff

An employee has been dismissed temporarily

downsizing

An employee has been dismissed permanently

exit interview

A formal conversation between a manager and a departing employee to find out why they are leaving and to learn about potential problems in the organization

nondisparagement agreement

Contract between two parties that prohibits one party from criticizing another

employment at will

Governing principle of employment in the majority of states, that anyone can be dismissed at any time for any reason at all

4 Areas of Employment Law

1. Labor relations

2. Compensation and benefits

3. Health and safety

   1. Equal employment opportunity

collective bargaining

Negotiations between management and employees about disputes over compensation, benefits, working conditions, and job security

National Labor Relations Board (NLRB)

U.S. commission legislated in 1935 that enforces procedures whereby employees may vote to have a union and for collective bargaining

Social Security Act of 1935

Established the U.S. retirement system

Fair Labor Standards Act of 1938

Established minimum living standards for workers engaged in interstate commerce, including a federal minimum wage, overtime, and ban on child labor

Equal Employment Opportunity Commission (EEOC)

U.S. panel that enforces antidiscrimination and other employment-related lawsw

workplace discrimination

Occurs when decisions about people are made for reasons not relevant to the job

adverse impact

Occurs when an organization uses an employment practice or procedure that results in unfavorable outcomes for a protected class over another group

disparate treatment

Occurs when employees from protected groups are intentionally treated differently

affirmative action

Focuses on achieving equality of opportunity within an organization

labor unions

Organizations of employees formed to protect and advance their members’ interests by bargaining with management over job-related issues

union security clause

Part of a labor-management agreement that states that employees who receive union benefits must join the union, or least pay dues

right-to-work laws

Statutes that prohibit employees from being required to join a union as a condition of employment

closed shop

Employer may only hire workers who are already in the union

union shop

Workers aren’t required to be union members when hired but must join within a specified time

agency shop

Workers must pay equivalent of union dues but aren’t required to join the union

open shop

Workers may choose whether to join a union

two-tier wage contracts

New employees are paid less or receive fewer benefits than veteran employees

cost-of-living adjustment (COLA) clause

Clause in a union contract that ties future wage increases to increases in the cost of living

grievance

Complaint by an employee that management has violated the terms of the labor-management agreement

mediation

Process where a neutral third party listens to both sides in a dispute, makes suggestions, and encourages them to agree on a solution

arbitration

Process where a neutral third party listens to both parties in a dispute and makes a decision that parties have agreed to abide by