CHAPTER_7

UNIT SEVEN: RESOURCES MANAGEMENT

1. Objectives

• At the end of this chapter, students should be able to:

  • Explain mechanisms for acquiring and retaining human resources.

  • Describe the process of budgeting.

  • Discuss points for controlling and maintaining equipment.

  • Understand how managers maximize their time.

2. Introduction to Management

• Definition: Management involves planning, organizing, leading, and controlling resources to achieve organizational goals.

• Managers: Responsible for supervising resources to meet organizational goals, measured by organizational performance.

• Resources include:

  • People

  • Skills and know-how

  • Machinery

  • Raw materials

  • IT systems

  • Financial capital

  • Customers and employees.

3. Human Resource Management

• Definition:

  • According to British Institute of Personnel Management: Focused on people at work and their relationships in an organization.

  • According to American Management Association: Involves planning, organizing, and controlling workforce utilization to achieve organizational goals.

Activities of Human Resource Management

• Acquisition of Human Resources:

  • Involves planning, recruitment, selection, and orientation.

• Retention Activities:

  • Performance appraisal, training and development, compensation administration.

4. Acquiring Human Resources

• Human Resource Planning:

  • Organizations assess their staffing needs through planning, acknowledging that workforce requirements are dynamic.

  • Key Drivers:

    • Organizational growth and higher service demand

    • Employee turnover (resignation, discharge, retirement).

• Five Steps of HR Planning:

  1. Profiling: Identify future personnel needs.

  2. Estimating: Project needed personnel types and numbers.

  3. Inventorying: Conduct an audit of current employees.

  4. Forecasting: Anticipate changes in workforce entries/exits.

  5. Planning: Use prior steps to ensure appropriate personnel with necessary skills.

Sources of Human Resources

• Internal Sources:

  • Filling vacancies through transfers/promotions.

  • Advantages: Cost-effective, quicker, boosts employee morale.

  • Disadvantages: May favor seniority over qualification.

• External Sources:

  • Recruiting new employees through advertisements and college visits.

5. Recruitment and Selection

• Recruitment: Attracting qualified candidates for job vacancies, adhering to employment law.

• Selection Process: Choosing prospective employees based on their training, experiences, and abilities.

  • Model Steps:

    1. Analyze vacant jobs through job analysis.

    2. Select criteria and predictors based on analysis.

    3. Measure performance against criteria.

    4. Assess the validity of predictors.

    5. Determine the utility of predictors.

    6. Reanalyze selection processes periodically.

6. Orientation & Employment Legislation

• Orientation Programs: Introduce new employees to the organization, covering structure, philosophy, and policies.

• Employment Legislation: Important for compliance in hiring and employment practices concerning discrimination and workplace conflicts.

7. Retaining Employees

• Development: A source of motivation for employees to reach their full potential.

• Rewards Systems: Non-monetary benefits such as flexibility, holidays, and additional compensations.

• Retaining Activities: Include training and development, performance appraisals, disciplinary actions, and compensation administration.

8. Training Needs Assessment

• Three Steps:

  1. Organizational Analysis: Review of the organization’s objectives and resources.

  2. Operational Analysis: Assessing job requirements without consideration of who currently performs the job.

  3. Personnel Analysis: Identifying specific training needs for employees based on their performance.

9. Methods of Training

• Methods: Presentation, hands-on, and group building methods.

  • Presentation Methods: Lectures and audio-visual techniques.

  • Hands-on Methods: On-the-job training, simulations, role plays.

  • Group Building Methods: Enhance individual and team effectiveness through shared experiences.

10. Performance Appraisal

• Purpose: Evaluate employee effectiveness, inform management decisions, and assist in personal development.

  • Common Problems: Issues with supervision, variability in standards, leniency errors, and halo errors.

  • Effective Appraisals: Should relate to job descriptions and include various evaluation tools like rating scales, checklists, and management by objectives.

11. Budgeting

• Definition: A plan for resource allocation and a control mechanism.

• Process: Must include organizational goals, job descriptions, and formal budgeting policies.

• Types of Budgets: Operating, capital, cash, labor, flexible, strategic, zero-based budgeting.

12. Material Management

• Definition: Integration of purchasing and related activities ensuring the proper materials arrive at necessary locations on time.

• Types of Materials:

  • Expendable (consumable)

  • Non-expendable (capital).

13. Managing Equipment

• Key Areas: Ordering, storing, issuing, and controlling equipment.

• Important Control Points: Cleaning, inspection, returning items, and checking discrepancies.

14. Managing Time

• Non-renewable resource: Importance of maximizing managerial time by setting goals, planning strategies, and arranging events in structured timeframes.

• Time Plans: Timetables, schedules, and rosters are essential for organized management of duties and responsibilities.