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Chapter 01

MGHB02H3 Chapter Notes - Chapter 01: Performance Management, Six Sigma, Layoff

Management (MGH)
Course Code
Joanna Heathcote

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Chapter 01 the World of HR Management
Outcome #1: Explain how HR managers can help their organizations gain a sustainable competitive advantage
through the strategic utilization of people
- What is HR Management?
The process of managing human talent to achieve an organization’s objectives
- What is HR Capital?
HR Capital describes the economic value of employee’s knowledge, skills, and capabilities. It is intangible
and cannot be managed the way organizations manage jobs, products, and technologies because employees,
not the organizations, own the human capital
To build human capital in organizations, managers must continue to develop superior knowledge, skills, and
experience within their workforces and retain and promote top performers
- Why Study HR Management?
Staffing the organization, designing jobs and teams, developing skillful employees, identifying approaches
for improving their performance, and rewarding employee successesall typically labeled HRM issues
are as relevant to line managers as they are managers in the HR department
Outcome #2: Explain how globalization is influencing human resources management
Overall Framework for HR Management:
- What are 9 Competitive Challenges in HR Management?
1. Responding Strategically to Changes in the Marketplace and Economy:
Due to the highly competitive environments, in which competition is global and innovations is continuous,
being able to adapt has become the key to capturing opportunities and overcoming obstacles, as well as the
vary survival of organizations
In meeting customer expectations, managers must focus on quality, innovation, variety, and
HR professionals can help organizations improve not only a company’s bottom line by streamlining
employment costs, but also the top line by forecasting labor trends, designing new ways to acquire and
utilize employees, measuring their effectiveness, and helping managers enter new markets
Six Sigma: is a set of principles and practices whose core ideas include understanding customer needs,
doing things right the first time, and striving for continuous improvements
2. Managing Change:
Reengineering, Total Quality Improvement, Downsizing, and Outsourcing, Cost-cutting, Benefit Programs
are examples of organizations use to modify the way they operate to be more successful:
1) Reengineering: the fundamental rethinking and radical redesign of business processes to achieve
dramatic improvements in cost, quality, services, and speed
2) Downsizing: the planned elimination of jobs
3) Outsourcing: hiring someone outside the company to perform business processes that were
previously done within the firm

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All above strategies require organizations to engage in change management
Change Management: is a systematic way to bringing about the managing both organizations’ changes
and changes on the individual level
(Is the Biggest Challenges because although most employees understand that change is continuous
responsibilities, job assignments, and work processes change people often resist it because it requires
them to modify or abandon ways of working that have been successful or at least familiar to them)
To Manage Change, organizations has to envision the future, communicate this vision to employees, set
clear expectations for performance, and develop capacity to execute by reorganizing people and
reallocating assets,
Organizations that have been successful in engineering change, they 1) link the change to the business
strategy; 2) show how the change creates quantifiable benefits; 3) engage key employees, customers, and
their suppliers early when making a change; 4) make an investment in implementing and sustaining
Reactive Changes: it results when external forces, such as the competition, a recession, a law change, or a
crisis, have already affected an organization’s performance
Proactive Changes: initiated by managers to take advantage of targeted opportunities, particularly in fast-
changing industries in which followers are not successful
Good HR Managers know that they can be key players when it comes to driving the business strategies of
their organization’s to make changes, that is why CEOs, such as WestJet, Starbucks, and GE require their
top HR executives report directly to them and help them address key issues
Why Change Efforts Fail:
1) Not establishing a sense of urgency
2) Not creating a powerful coalition to guide the effort
3) Lacking leaders who have a vision
4) Lacking leaders who communicate the vision
5) Not removing obstacles to the new vision
6) Not systematically planning for and creating short-term ―wins.‖
7) Declaring victory too soon
8) Not anchoring changes in the corporate culture
3. Globalization (Competing, Recruiting, and Staffing Globally):
The trend toward opening up foreign markets to international trade and investment
Partnerships and Mergers are two ways companies are going globally
The Opportunities: greater target market
The Difficulties: cultures are different; how to achieve collaboration among employees across the world;
safety standard while employees working abroad
Impacts of Globalization on HRM:
1) Issues related to different geographies, including different cultural, employment laws, and business
2) Gauging the knowledge and skill base of international workers and figuring out how best the hire
and train them
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