Chapter 12 Human Resources Textbook Notes

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University of Waterloo
Accounting & Financial Management
AFM 131
Robert Sproule

Chapter12-HumanResources Working with People is Just the Beginning  Human Resource Management (HRM): the process of determining human resource needs then recruiting, selecting, developing, motivating, evaluating, compensating, and scheduling employees to achieve organizational goals  Roles of HRM have evolved due to: o Organizations recognition of employees as their ultimate resource o Changes in the laws that rewrote many traditional practices Developing the Ultimate Resource  HRM receiving increased attention as the nature of work shifts from traditional manufacturing, to service and high tech requiring highly technical job skills o some older workers need to be retrained  People are the ultimate resource because their ideas are worth a lot o Good ideas become the products or services that satisfy customer needs  Hiring and retaining good employees is the key to company success o Tactics include: bonuses, additional training, and profit-sharing plans  HR functions used to be the responsibilities of the functional departments that employed them o Today qualified employees are scarcer, escalating the role of HRM o More time spent on strategic input rather than admin work Human Resource Challenges  Challenges include: o Managing talent: retraining old workers from declining industries, finding new ones to replace aging workforce o Managing demographics: undereducated and unprepared o Improving leadership development o Managing work-life balance: given increase in single parent and two income families o Effects of globalization: job losses or hard time fitting in o Transforming HRM into a strategic partner in a company  Declining economy impacting employee morale  Shift to more part time jobs and decreased employee loyalty  Ways to fix some of the challenges: o Understand the external and internal environment o Select the most critical HR topics and set priorities o Initiate projects with dedicated teams o Have support from top management Determining Your Human Resource Needs  Preparing a human resources inventory of current employees o Including: education, capabilities, training, and specialized skills o Importance of people skills regardless of the job  Preparing a job analysis: a study of what is done by employees who hold various job titles o Job description: summary of the objectives of the job, type of work done, responsibilities and duties, working conditions, and relationship of the job to other functions o Job specifications: minimum qualifications required of workers to do a particular job  Assessing future human resource demand o Ensure that trained people are available when needed due to rapid technological changes  Assessing future human resource supply o Anticipating a constant shifting labour force; older population, more technical orientation, more women, workers either scarcer or in over-supply given changing company needs  Establishing a strategic plan o Must address all the elements of HRM o Must all get upper management support for acceptance and implementation  More companies are using tech to help perform HRM planning processes, making them happen more efficiently Recruiting Employees from a Diverse Population  Recruitment: the set of activities used to obtain a sufficient number of the right people at the right time  End result is to have a pool of qualified applicants for a job  Is very difficult task due to: o Corporate policies (such as internal promotions), union contracts, and low wages o Legal guidelines: equal opportunity for women and visible minorities even if they lack required competency o The fit in terms of culture, teamwork and management style, not just competent in skills o Lack of properly skilled workers available, must hire and train internally  Different sources for hiring: internal vs. external o Internal sources less expensive to recruit, also helps to boost employee morale o External resources helps to attract a wide variety of talent, brings in new perspectives Selecting Employees Who Will be Productive  Selection: the process of gathering information and deciding who should be hired o Starting to become a very expensive process o Interview times needed, testing required, training needed, time spent learning the job and moving costs  The Selection Process o Obtaining complete application forms  Helps to reveal educational background, work experiences, career objectives and other qualifications related to job requirements  Used to initially screen applicants o Conducting initial and follow-up interviews  First interview is often conducted by HR staff along with direct supervisor/manager  Must ask all candidates the same questions, watch the phrasing of questions, cannot discriminate o Giving employment tests  Measure basic competencies in specific job skills, also helps to evaluate personalities and interest that relate directly to the job o Conducting background checks  Verify information and confirm likelihood of a successful hire including accessing of social media sites o Establishing probationary periods  Hiring conditionally lets the employee prove the hiring decision was correct  Although the cost of selection is high, cost of replacing workers is even higher Hiring Contingent Workers  Contingent workers: workers who do not have regular, full-time employment  Another option is the hiring of contingent workers for varying needs o They include part time, temporary, seasonal, independent contractors, interns, or co-op students o Companies hire when: full-time employees are on a leave, peak demand, uncertain economy, and when jobs require minimal training o Con: no/little benefits and lower wages paid o Pro: may lead to full-time employment, offers flexibility o Many managers use temporary workers to weed out poor workers and find good hires o Temping can be even more secure than a permanent job in an era of uncertain economy and rapid change Training and Developing Employees for Optimum Performance  Training and development: all attempts to improve productivity by increasing an employee’s ability to perform o Training focuses more on short term skills vs. development focuses more on long term skills  Quality training programs often lead to: higher retention rates, increased productivity, and greater job satisfaction  All programs include three steps: o Assessing job needs and skills of employees o Designing training activities o Evaluating effectiveness of training programs  Employee orientation: initiates new employees including meeting other employees and reviewing company policies  On-the-job training: learn by watching others and then imitates them, all right at the workplace o Also known as shadowing o Good for relatively simple or repetitive jobs o More demanding/intricate jobs require a more intense training effort  Apprentice programs: working alongside an experienced worker to master a craft o May include classroom training  Off-the-job training: develop certain skills including education and personal development away from the work place in internal or external programs o Subject may include: time management, stress management, and health and wellness  On-line training: provide consistent content tailored to specific employee needs, at convenient times, to a large number of employees  Vestibule training: training done in schools where employees are taught on equipment similar to that used on the job o Allows workers to learn proper methods and safety training before assuming specific job assignments  Job simulation: use of equipment that duplicates exact job conditions because cost of real world mistake is huge o Ex: astronauts, airline pilots, and ship captains Management Development  Management development: process of training and educating employees to become good managers and then monitoring the progress of their managerial skills over time  Trains in: communication, time management, planning, human relations skills o Participate in: role play, complete cases, watch films and attend lectures o Also includes: on-the-job coaching, understudy positions, job rotation, off-the-job courses and training  Both training and development budgets needs to be constantly reviewed to ensure that maximum impact is being achieved and getting the best return on investment Empowering Workers  Empowering employees, less directing, through giving authority and responsibility o Allows employees to respond quickly to customers o Some manager reluctant to empower employees as manage has to give up power o Managers now become less of a boss and more of coach, assistant, or team member  Enabling: giving workers the education and tools they need to make decisions o Key to success of empowerment Networking  Networking: process of establishing and maintaining contacts, both internally and externally, to weave strong relationships that serve as informal development systems  Mentoring also occurs within an organization by an experienced employee o Many organizations formally assigns mentors to employees considered to have strong potential o Introducing the mentee to the right people and being organizational sponsor Diversity in Management Development  Initiative to start developing female and minority managers will: o Bring more talent into the door which may attract the best of female and vi
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