ADMS 2600 Study Guide - Midterm Guide: Human Resource Management, Total Quality Management, Corporate Social Responsibility

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20 Nov 2011
HR Midterm-exam notes
CH. 1 – The world of human resources
Why Study human resources?
Core competencies - integrated knowledge sets within an organization that distinguish it from its competitors and deliver value to customers.
Competitive Challenge: The most pressing competitive issues facing firms:
1. Competing, recruiting, and staffing globally
Globalization - The trend towards opening up foreign markets to international trade and investment.
Impact of Globalization. - “Anything, anywhere, anytime”
markets, Partnerships with foreign firms, Lower trade and tariff barriers. Corporate Social
Responsibility - The responsibility of the firm to act in the best interests of the people and communities affected by its activities.
Impact on HRM - Different geographies, cultures, laws, and business practices
Issues: Identifying capable managers and workers, Developing foreign culture and work practice training
programs, Adjusting compensation plans for overseas work. 2. Embracing New technology
Knowledge Workers - Workers whose
responsibilities extend beyond the physical execution of work to include planning, decision making, and problem solving.
Knowledge-Based Training - Online instruction, “Just-in-time” learning via the Internet on company intranets.
Influence of technology on HR
Human Resources Information System (HRIS) - A computerized system that provides current and accurate data for the
purposes of control and decision making. Benefits (operational, Relational, transformation): Store and retrieve of large
quantities of data, Combine and reconfigure data to create new information, Institutionalization of organizational knowledge, Easier communications, Lower administrative costs,
increased productivity and response times. Investment factors:
- Fit the
application of the firm’s employee base.
- Ability to upgrade or customize the software
- Compatibility with current systems
-User friendliness
- Availability of technical support
- Time required to implement and train staff members to
use the HRIS - Initial costs and
annual maintenance costs
3. Managing Change
Types of Change
Reactive change - Change that occurs after external forces have already affected performance.
Proactive change - Change initiated to take advantage of targeted opportunities.
Managing Change through HR
Formal change management programs help to keep employees focused on
the success of the business. Why Change Efforts Fail:
- Not
establishing a sense of urgency.
- Not creating a powerful coalition to guide the effort.
- Lacking leaders who have a vision.
- Lacking leaders who communicate the vision.
- Not removing obstacles to the new vision.
- Not systematically
planning for and creating short-term “wins.”
- Declaring victory too soon.
- Not anchoring changes in the corporate culture.
4. Managing Talent, or Human Capital
Human Capital - The knowledge, skills, and capabilities of individuals that have economic value to an
organization. Valuable because capital: is based on company-specific skills, is
gained through long-term experience, can be expanded through development. Human Capital and HRM:
Creation of knowledge, Utilization of knowledge, Application of knowledge
5. Responding to the market
Total Quality Management (TQM) - A set of principles and practices whose core ideas include understanding customer needs, doing things right
the first time, and striving for continuous improvement. Six Sigma - A process used to translate customer needs into a set of optimal tasks that are
performed in concert with one another. Reengineering and HRM - Fundamental rethinking and radical
redesign of business processes to achieve dramatic improvements in cost, quality, service, and speed. 6. Containing Costs
Downsizing - The planned elimination of jobs (“head count”).
Hidden Costs of Layoff:
- Severance and rehiring costs.
- Accrued vacation and sick day payouts.
- Pension and benefit payoffs.
- Potential lawsuits from aggrieved
workers. - Loss of
institutional memory and trust in management.
- Lack of staffers when the economy rebounds.
- Survivors who are risk-averse, paranoid, and political.
Benefits of a No-Layoff Policy
- A fiercely loyal and more productive workforce.
- Higher customer satisfaction.
- Readiness to snap back with the economy.
- A recruiting edge.
- Workers who aren’t afraid to innovate, knowing their jobs are safe.
Outsourcing - Contracting outside the organization to have work done that formerly was done by internal employees.
Off shoring - The business practice of sending jobs to other countries.
Employee Leasing - The process of dismissing employees
who are then hired by a leasing company (which handles all HR-related activities) and contracting with that company to lease back the employees.
Productivity Enhancements
Demographic and Employee Concerns
The d iversity/immigration Challenge
Age Distribution of Employees
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Gender Distribution of the Workforce
Rising Levels of Education
Cultural Changes
Employee rights
Concern for
privacy Changing
nature of the job
Changing attitudes toward work
Balancing Work and Family
Partnership of Line Managers and HR Departments
Responsibilities - Advice and counsel, Service ( recruiting, selecting, testing, planning, conducting training programs) , Policy formulation and implementation,
Employee advocacy (listening to employees’ concern). Competencies - Business mastery, HR mastery ( master the areas of staffing, development, appraisals, rewards, team
building and communication) , Change mastery, Personal credibility. Role of Line Manager
Managers are ultimately responsible for the productivity
and safety of their employees. Line managers who have
studied human resources management have information and skills that will increase their effectiveness in the management of their employees.
HR as a profession
Membership in a Professional Organization, Certification, Code of Ethics, Professional Development.
Ch.2 – Strategy and Human Resources Planning
Strategic Planning and Human Resources
Strategic Planning - Procedures for making decisions about the organization’s long-term goals and strategies.
Human Resources Planning (HRP) - Process of anticipating and making provision
for the movement (flow) of people into, within, and out of an organization. Strategic Human Resources Management
(SHRM) - The pattern of human resources deployments and activities that enable an organization to achieve its strategic goals. Strategy
formulation—providing input as to what is possible given the types and numbers of people available.
Strategy implementation—making primary resource allocation decisions about structure, processes, and human resources.
Strategic Analysis - What human resources are needed and what are available?
Strategic Formulation - What is required and necessary in support of human
resources? Strategic Implementation - How will the human
resources be allocated? 1. Mission, Vision,
Mission - The basic purpose of the organization as well as its scope of operations.
Strategic Vision - A statement about where the company is going and what it can become in the future; clarifies the long-term direction of the company
and its strategic intent. Core Values - The strong and enduring beliefs and principles that the company uses as a foundation for its
decisions. 2. Environmental Analysis
Environmental Analysis - The systematic
monitoring of the major external forces influencing the organization. Economic factors:
general and regional conditions
Competitive trends: new processes, services, and innovations
Technological changes: robotics and office automation
Political and legislative issues: laws and administrative rulings
Social concerns: child care and educational priorities
Demographic trends: age, composition, and literacy
Competitive Environment
Includes the specific organizations with which the firm interacts like firm’s customers, rival firms, new entrants, substitutes and suppliers. In strategic
planning, firms analyze the competitive environment in order to adapt to in influence the nature of the competition. The more power each of these forces has, the less profitable
the industry will be. 3. Internal Analysis
Cultural, Capabilities, and Composition
Cultural Audits - Audits of the culture and quality of work life in an organization.
How do employees spend their time?
How do they interact with each other?
Are employees empowered?
What is the
predominant leadership style of managers?
How do employees advance within the organization?
Core Competencies - Integrated knowledge sets within an organization that
distinguish it from its competitors and deliver value to customers. Sustained competitive advantage through
people is achieved if these human resources: Are valuable.
Are rare and unavailable to competitors.
Are difficult to imitate.
Are organized for synergy.
Strategic knowledge workers -Employees who have firm-specific skills that are directly linked to the company’s strategy.
Example: Senior software programmer
Core employees - Employees with skills to perform a
predefined job that are quite valuable to a company, but not unique. Example: Security guard
labour - Employees whose skills are of less strategic value and generally available to all firms.
Example: General electrician
Alliance or Partners - Individuals and groups with unique skills, but those skills are not directly related to a company’s core strategy.
Example: Independent product label designer
Forecasting: A critical Element of Planning
Forecasting involves: forecasting the demand
for labour, forecasting the supply of labour and balancing supply and demand considerations
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Forecasting a Firm’s Demand for Employees
Factors that can affect the demand for labour: competitive strategy, technology, structure, and productivity.
Quantitative: Use of statistical or mathematical techniques. Ex. Trend Analysis – a firm’s employment requirements are forecasted on the basis of
some organizational index. Forecasting labour demand based on an organizational index such as sales:
Select a business factor that best predicts human resources needs.
Plot the business factor in relation to the
number of employees to determine the labour productivity ratio. Compute the
productivity ratio for the past five years.
Calculate human resources demand by multiplying the business factor by the productivity ratio.
Project human resources demand out to the target year(s).
Qualitative Approach:
Management Forecasts - The opinions (judgments) of supervisors, department managers, experts, or others knowledgeable about the organization’s future employment needs.
Delphi Technique - An attempt to decrease the subjectivity of forecasts by soliciting and summarizing the judgments of a preselected group of
individuals. The final forecast represents a composite group judgment.
Forecasting the Supply of Employees
Staffing Tables - Graphic representations of all
organizational jobs, along with the numbers of employees currently occupying those jobs and future (monthly or yearly) employment requirements.
Markov Analysis - A method for tracking the pattern of employee movements through various jobs.
Skill Inventories - Files of personnel education, experience, interests, skills, etc., that allow managers to quickly match job openings with employee backgrounds.
Replacement Charts - Listings of current jobholders and persons who are potential replacements if an opening occurs.
Succession Planning - The process of identifying, developing, and tracking key individuals for
executive positions.
4. Formulating Strategy
Strategy Formulation - Moving from simple analysis to devising a coherent course of action.
SWOT analysis - A comparison of strengths, weaknesses, opportunities, and threats for strategy formulation purposes.
Use the strengths of the organization to capitalize on opportunities, counteract threats,
and alleviate internal weaknesses. Corporate Strategy
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