Business Management Unit 3 AOS 2 (Human Resource Management)

Human resource management

the effective management of the formal relationships between the employers and the employees

Human resource manager

coordinates all the activities involved in acquiring, developing, maintaining and terminating employees from a business's human resources

What is the HR managers responsibility for employees

• acquire employees (recruitment)

• developing and training employees

• maintaining and motivating employees

• termination of employees

Human resource strategies to increase market share

- Introduce motivational strategies that will improve employee motivation

Human resource strategies to increase profits

- Introduce performance related pay so employees are motivated to develop sales skills

Maslow's hierarchy of needs

suggests that people have five fundamental needs, and their sequential attainment of each need acts as a source of motivation

Tiers of Maslow's hierarchy and how they relate to a business (Need to get them in order)

-Physiological (Job, Income)

- Safety (OH&S, Job Security)

- Social (Teamwork, social activities)

- Esteem (Recognition, Delegation, Empowerment)

- Self-actualisation (opportunities for advancement)

Advantages of Maslow's hierarchy of needs

• Can help managers determine which level of the hierarchy is motivating an employee. This therefore allows a manager to introduce targeted strategies that directly address specific employee needs

• Employees can work in an engaging environment that allows them to reach their full potential

Disadvantages of Maslow's hierarchy of needs

• It assumes employees are motivated by the same things in the same priority order

• It assumes that there are no other fundamental needs that can motivate employees

• It may be time-consuming for a manager to determine the level of each individual employee, and implement appropriate strategies for each

Locke and Latham's Goal setting theory

states that employees are motivated by clearly defined goals that fulfil five key principles

5 principles of Locke and Latham's Goal setting

- Clarity (Simple, clear and specific goals that are measurable)

- Challenge (Not too challenging, not too easy)

- Commitment (More input employees have the more motivated they are)

- Complexity (Straightforward and allow employee skills to develop)

- Feedback (Offering recognition for progress and outlines expectations)

advantages of Locke and Latham's Goal Setting Theory

• goals that align employee goals with achieving business objectives are likely to improve business performance

• employees may be more motivated to complete tasks if work goals align with their personal interests

• goals are specific and measurable, it is not time-consuming for managers to assess whether an employee has achieved their goal or not

disadvantages of Locke and Latham's Goal Setting Theory

- may be difficult for manager to always align employee’s personal goals with business objectives

- Failing to meet a goal is demotivating for an employee

- The process of setting goals and providing feedback to each employee can be time-consuming for management

The Four Drive Theory

suggests that people strive to balance four fundamental desires

What are the Four Drives

- Drive to Acquire (The desire to achieve rewards and high status)

- Drive to Bond (participate in social interactions and feel a sense of belonging)

- Drive to Learn (gain knowledge, skills and experience)

- Drive to Defend (protect personal security as well as the values of the business)

Advantages of the Four Drive Theory

- All four drives can be attained simultaneously, and are not restricted to sequential orders

- The model provides a simple approach for motivating employees and is easy for managers to implement

- Satisfying drives can improve employee performance and business productivity and therefore increase profits

Disadvantages of the Four Drive Theory

- Some drives can be overlooked and therefore, an employee’s full potential may not be achieved

- Rewarding individual employees may lead to unhealthy competition in the workplace

Similarities between Maslow's and Locke and Latham's Theories

- Both theories recognise that personal gain motivates employees (esteem needs and commitment)

- Both consider the importance of feedback from management (self-esteem and feedback)

- Both theories place emphasis on motivating through intrinsic factors

Differences between Maslow's and Locke and Latham's Theories

- Motivators in goal setting theory can be unique and personal, while those in maslow comply with the list provided by maslow

- Maslow can be applied by a manager alone, whereas goal setting requires employee input

Similarities between The Four Drives Theory and Locke and Latham's Theories

- Both theories recognise that employees are motivated to achieve success (drive to acquire and challenge)

- Both suggest that multiple factors motivate an employee at any given time

Differences between The Four Drives Theory and Locke and Latham's Theories

- goal setting requires employee input, whereas four drive theory is applied by the manager alone

- the pursuit of goals in goal setting is usually one at a time, whereas the pursuit of different drives in four drive theory can be simultaneous

Similarities between Maslow's and the Four Drive's Theory

- Both concerned with the physical, social, and emotional needs of employees

- Both suggests employees are motivated by the desire to feel a sense of belonging within the workplace (social needs and drive to bond)

- Both suggest that employees are motivated by the desire to improve knowledge and skills (self-actualisation and drive to learn)

Differences between Maslow's and the Four Drive's Theory

- Maslow’s theory must be sequential and each need addressed one at a time, whereas Four drive theory can be targeted simultaneously and any drive may be relevant to an employee with no particular order

5 Types of Motivational Strategies

- Performance Related Pay

- Career Advancement

- Investment in Training

- Support Strategies

- Sanction Strategies

Performance related pay

A financial reward that employees receive for reaching or exceeding a set business goal

Performance related pay examples

- Pay rises

- Bonuses

- Commission on sales

Performance related pay Impact on motivation (Short and Long Term)

Short Term

- Employees are powerfully motivated to immediately receive financial

Long Term

- Only a long term impact if the payments are ongoing

What Motivational theories does Performance related pay relate to

Maslow: Esteem and Physiological needs

The Four Drives: Drive to acquire

Performance related pay Advantages

- Will only apply when employees actual performance is improved

- There is an immediate boost to motivation

Performance related pay Disadvantages

- Motivation lessens as time goes on

- Other employees may expect similar rewards and thus lower morale

Career Advancement

The upwards progression of an employee’s job position

Career Advancement impact on motivation (Short and Long Term)

Short Term

- Immediate boost to self esteem

Long Term

- Improves loyalty, Self-actualisation

What Motivational Theories do Career Advancement Relate to

Maslow's: Security needs, Esteem needs, Self-Actualisation

Four Drives: Drive to acquire, Drive to comprehend

Career Advancement Advantages

- Retains valuable employees

- Promoted employees feel like they can contribute more, improving productivity

Career Advancement Disadvantages

- Promotion positions must have a purpose

- Promotion can cause resentment among other employees

Investment in Training

allocating resources to improve employee skills and knowledge

Investment in Trainings impact on motivation (Short and Long Term)

Short Term

- Increases commitment and loyalty

- Creates a feeling that the business cares about development

Long Term

- Improved skills can heighten esteem

- Trained staff can meet more business objectives

What Motivational Theories do Investment in Training relate to

Maslow: Esteem need, Self Actualisation need

Goal Setting: Challaning, Clear

Four Drives: Drive to acquire, Drive to comprehend

Investment in Training Advantages

- Improved loyalty from greater job security

- Improve the productivity of employees due to them being more skilled

Investment in Training Disadvantages

- Training may be wasted unless there are sufficient jobs

- Employee may eventually leave wasting the cost of their training

Support Strategies

involve providing employees with any assistance that improves their satisfaction at work

Types of Support Strategies

- Mentoring

- Counciling

Support Strategies impact on motivation (Short and Long Term)

Short Term

- Help Resolves employee issues

- Can resolve problems employees face

Long Term

- Improve employee loyalty and build positive relationships

What Motivational Theories relate to support strategies

Maslow's: Social needs, Security needs

Four Drives: The Drive to bond

Support Strategies Advantages

- Provided with little to no cost

- Support can develop positive relationships between employees and management

Support Strategies Disadvantages

- May be difficult to support all employees

- Employees may be dependent on support services

Sanction Strategies

involve penalising employees for poor performance or breaching business policies

Types of Sanctions

- Written or Verbal warning

- Dismissal

Sanctions impact on motivation (Short and Long Term)

Short Term

- Reflection and assessment of performance

- Adjust behaviour and attitudes

Long Term

- Unless there is a constant threat there is no long term impact

What Motivational Theories relate to Sanctions

Maslow's: Security needs

Four Drives: Drive to Defend

Sanctions Advantages

- Can motivate employees to improve performance

- May quickly stop inappropriate or harmful behaviour

Sanction Disadvantages

- Can reduce a sense of belonging and can lower motivation

- Only motivates in the short term

Training

The process of teaching staff how to do their job more efficiently and effectively by boosting their knowledge and skills

Benefits of training for employees

- Opportunity for promotion and self-improvement

- Improved job satisfaction through better job performance

Benefits of training for business

- Higher productivity through better job performance and more efficient use of human resources

- Goals and objectives more effectively met

Why do businesses need ongoing training

Technological changes

On-the-job Training

Training that occurs in the working environment and uses the equipment, machinery and documents that are present in the workplace. It is provided by someone who works at the trainees job.

Types of On-the-job Training

- Mentoring/Coaching

- Job Rotations

- Apprenticeships

Advantages of On-the-job Training

- Cost effective as there are no travel expenses

- Employees work while trained so are more productive

- Employees are in a familiar environment an are comfortable

Disadvantages of On-the-job Training

- Quality of the trainer may vary

- Bad habits of older staff are passed on

- Trainer may have to leave own duties to carry out training

Off-the-job Training

Training that occurs in a location away from the workplace, involving sending employees to a specialised training institution and provided by someone not in the business.

Types of Off-the-job training

- Conferences/Workplace

- Online training

- Simulations/RP's

Advantages of Off-the-job training

- Wider range of skills and qualifications

- More structured and organised

- Outside experts and specialist providing border experiences

Disadvantages of Off-the-job training

-May be too focused on theory with little prac

- More expensive due to fees and travel costs

- Lost working time while employees are away

Similarities between On-the-job and Off-the-job

- Both improve employees skills

- Both can motivate employees

- Both use someone more specialised

Diffrences between On-the-job and Off-the-job

- ON is real life, OFF are simulations

- ON specialists from inside the job, OFF specialists from outside the job

- ON involves actual work, OFF theory based

- ON mainly for current role, OFF could be futuristic

Succession Planning

Ensuring that managers in the business are able to step into senior management positions if vacancy occurs

Performance Management

A focus on improving both business and individual performance through relating business performance objective to individual employee performance objectives

Types of Performance Management Strategies

- Management by Objectives

- Appraisals

- Employee Self-evaluation

- Employee Observations

Management by Objectives

A process by which management and employees agree on a set of goals for each employee, with these goals all contributing to the objective of the business as a whole

Advantages of Management by Objectives

- The more involved employees are with making goals, the more productive they will be

- Can improve communication and result in employees being more aware of business objectives

- There is clarity around performance and improvement

Disadvantages of Management by Objectives

- Time consuming and costly

- Failing to meet objectives can demotivate some employees

- Expectations of pay rises of rewards if objectives are met

Appraisal

the formal assessment of how efficiently and effectively an employee is performing their role in a business

Purpose of appraisal

- Identify training and development needs

- Identify new possible employee objectives

- Determine if employees should receive promotions or pay rises

Methods of appraisal

- Essay method (Manager keeps a journal of notes of all performance for each employee)

- Critical incident method (Manager keeps a journal of only good or bad aspects of performance)

- Comparison method (Employees ranked according to set criteria)

Advantages of Appraisal

- Facilitates communication and allows positive relationships between employees and managers

- Feedback can help employees improve

- Info from appraisal asist manager when making decisions about pay increase, dismissals or promotions

Disadvantages of Appraisal

- Can become time consuming

- Causes stress for both parties

- Staff who meet performance standards may expect pay rises or promotions

Employee self-evaluation

A process whereby employees carry out self-assessment based on a set of agreed criteria

Advantages of Employee self-evaluation

- Employer can gain insight into an employee’s understanding of their own strengths and weaknesses and assign work accordingly

- May be empowered to improve performance, as they are directly involved in their own performance management

- Can highlight the need for training

Disadvantages Employee self-evaluation

- Some employees may not wish to self-evaluate

- Employees may overstate their own performance of be dishonest

Employee Observation

-A strategy where a variety of opinions on the performance of employees is sought with the aim of arriving at a more comprehensive picture of past and current performance.

- Called the 360-degree method

Advantages of Employee Observation

- Allows a manager to gain a broad range of perspectives providing a comprehensive idea of overall performance

- Employees may imitate strengths of co-workers they observe

Disadvantages of Employee Observation

- Staff may feel stressed being observed

- Employees can be sabotage due to personal issues

- Staff that receive positive feedback may expect a pay rise or promotion

Types of Termination and weather it is voluntary or involuntary

- Retirement (Voluntary)

- Resignation (Voluntary

- Redundancy (Voluntary or Involuntary)

- Dismissal (Involuntary)

Retirement

Occurs when an employee decides to give up full-time or part-time work and no longer be a part of the labour force

Resignation

The voluntary ending of employment by the employee quitting their job due to; career advancement, dissatisfaction with their current job or wanting a lifestyle change

Redundancy

Occurs when a person's job no longer exist due to tech changes, a business restructure or a merger/acquisition

Difference between voluntary and Involuntary Redundancy

When an employee nominates themselves for a redundancy it is voluntary, however when an employee is asked to leave byt he business against their will it is involuntary

Dismissal

Occurs when the behaviour of an employee is unacceptable and a business terminate their employment

Types of Dismissal

- Summary (No notice requires, for when contract is breached)

- On-notice (Due to poor performance, notice is required)

Unfair Dismissal

When an employee is dismissed because the employer has discriminated against them in some way

Types of Unfair Dismissal

- Dismissed due to an absence from work due to illness/injury

- Dismissed due to belonging or not belonging to a union

- Dismissed due to other forms of discrimination

Entitlement considerations

Legal obligations an employer owes to it employees following the termination of their employment contract

Types of Entitlement Considerations and what Terminations it is for

- Outstanding wages (Voluntary and Involuntary)

- Accrued annual leave (Voluntary and Involuntary)

- Accrued long service leave (Voluntary and Involuntary)

- Severance pay (Involuntary)

- Period of notification (Involuntary)

- Terms of a redundancy package (Only redundancies)

Transition Considerations

Are social and ethical practices that a manager can consider implementing when terminating employment

Types of Transition Considerations and what Termination it is for

- Succession planning (Involuntary and Resignation)

- Providing a reference (Involuntary and Resignation)

- Financial planning assistance (Retirement)

- Upskilling (Redundancy)

Workplace relations

The interactions between employers and emplpoyees, or their reresentative, to acheive as set of working conditions that will meet the needs of employees, as well as allowing the business to achieve its own goals

Participants in the Workplace

- Human Resource Managers

- Employer Association

- Fair Work Commision

- Employees

- Union

Employees role in the workplace

- Adhere to the terms of the employment contract

- Perform their job to the best of their ability

- Negotiate in good faith

HR Managers role in the workplace

- Negotiation of employment agreements with employees

- Implementation of the agreement

- Training of staff

- Dealing with disputes