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ADMS 2600 (126)
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Chapter 1

ADMS 2600 Chapter 1 notes.docx

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York University
Administrative Studies
ADMS 2600
Sung Kwon

Chapter 1: The World of Human Resources Management human resources management (HRM) - the process of managing human talent to achieve an organization‘s objective Human Capital and HRM organizations ―compete through people‖ - achieving success increasingly depends on an organization's ability to manage talent, or human capital human capital - the economic value of employees‘ knowledge, skills, and capabilities - intangible and cannot be managed the way organizations manage jobs, products, and technologies - 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 - organizations have to find ways to better utilize the knowledge of their workers Competitive Challenges and Human Resources Management Challenge 1: Responding Strategically to Changes in the Marketplace Ability to adapt - key to capturing opportunities and overcoming obstacles, as well as the very survival of organizations HR Managers and Business Strategy HR professionals - can help improve not only a company's bottom line by streamlining employment costs but also the top line by forecasting labour trends, designing new ways to acquire and utilize employees, measuring their effectiveness, and helping managers enter new markets - HR managers need an intimate understanding of their firms‘ competitive business operations and strategies, whatever they may be Six Sigma - set of principles and practices whose core ideas include understanding customer needs, doing things right the first time, and striving for continuous improvement change management - systematic way of bringing about and managing both organizational changes and changes on the individual level  Reengineering - the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in cost, quality, service, and speed  Downsizing - planned elimination of jobs  Outsourcing - hiring someone outside the company to perform business processes that were previously done within the firm Organizations that have been successful in engineering change:  Link the change to the business strategy  Show how the change creates quantifiable benefits  Engage key employees, customers, and their suppliers early when making a change  Make an investment in implementing and sustaining change reactive changes - result 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 Challenge 2: Competing, Recruiting, and Staffing Globally Globalization - trend to opening up foreign markets to international trade and investment How companies globalize:  opening subsidiaries in international locations  partnerships  mergers General Agreement on Tariffs and Trade (GATT) - established rules and guidelines for global commerce between nations and groups of nations How Globalization Affects HRM - managers have to balance a complicated set of issues related to different geographies, including different cultures, employment laws, and business practices - HR issues include dealing with employees today who, via the Internet, are better informed about global job opportunities and are willing to pursue them, even if it means working for competing companies - gauging the knowledge and skill base of international workers and figuring out how best to hire and train them, sometimes with materials that must be translated into a number of different languages - relocating managers and other workers to direct the efforts of an international workforce - HR personnel frequently responsible for implementing training programs and enhancing their firms‘ managers‘ understanding of other cultures and practices, as well as dealing with the culture shock these workers might experience and pay differentials that must be adjusted, depending on the country Challenge 3: Setting and Achieving Corporate Social Responsibility and Sustainability Goals corporate social responsibility - the responsibility of the firm to act in the best interests of the people and communities affected by its activities - can not only help them avoid lawsuits but also improve their earnings - more important to prospective workers in their job selection sustainability - company's ability to produce a good or service without damaging the environment or depleting a resource One of HR's leadership roles is to spearhead the development and implementation of corporate citizenship throughout their organizations, especially the fair treatment of workers. Challenge 4: Advancing HRM with Technology collaborative software - allows workers anywhere anytime to interface and share information with one another electronically—wikis, document-sharing platforms such as Google Docs, online chat and instant messaging, web and videoconferencing, and electronic calendar systems—have changed how and where people and companies do business social media networking - has become the new way to find employees and check them out to see if they are acceptable candidates - HR managers are also grappling with whether or not to develop blogging and social media policies and whether or not to establish rules about the amount of time employees can spend online or to install software that cuts them off after a certain amount of time From Touch Labour to Knowledge Workers shift from ―touch labour‖ to knowledge workers - reduction in number of jobs that require little skill and increase in number of jobs that require considerable skill due to advanced technology knowledge workers - workers whose responsibilities extend beyond the physical execution of work to include planning, decision making, and problem solving Influence of Technology on HRM human resources information system (HRIS) - computerized system that provides current and accurate data for purposes of control and decision making - has become a potent weapon for lowering administrative costs, increasing productivity, speeding up response times, improving decision making, and tracking a company's talent Impact of HRIS on HRM 1. operational - automating routine activities, alleviating administrative burdens, reducing costs, and improving productivity internal to the HR function itself - most frequent uses of HRIS include automating payroll processing, maintaining employee records, and administering benefits programs 2. relational - connecting people with each other and with HR data they need - companies are using software to recruit, screen, and pretest applicants online before hiring them as well as to train, track, and promote employees once they have been hired 3. transformational - changing the way HR processes are designed and executed - HR software can be used to set the developmental goals of its employees once they have been hired and to gauge how well they are meeting them steps in choosing an HRIS - HR personnel to evaluate the biggest ―headaches‖ they experience, or the most time-consuming tasks, and then choose the applications that can have the strongest impact on the firm's financial measures—that is, the ones that get the ―biggest bang for the buck‖ - HR managers should then calculate the costs based on average salaries, or HR hours, that could be saved by using an HRIS, along with the hours of increased productivity that would occur as a result Highlights in HRM 1.2: Factors to Consider When Evaluating a Human Resources Information System  Fit of the application to 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 implementation of an effective HRIS: - biggest advantage gained is that HR personnel can concentrate more effectively on the firm's strategic direction instead of on routine tasks - forecasting personnel needs (especially for firms planning to expand, contract, or merge), planning for career and employee promotions, and evaluating the impact of the firm's policies—those related to both HR and other functions—to help improve the firm's earnings and strategic direction Challenge 5: Containing Costs while Retaining Top Talent and Maximizing Productivity Approaches to lowering labour-related costs  carefully managing employees‘ benefits  downsizing  outsourcing  offshoring  furloughing employees  engaging in employee leasing in an attempt to enhance productivity Downsizing Advocates of a no-layoff policy often note that layoffs may backfire after taking into account hidden costs:  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 Companies that avoid downsizing say they get some important benefits from such policies:  A fiercely loyal, more productive workforce  Higher customer satisfaction  Readiness to snap back with the economy  A recruiting edge  Workers who are not afraid to innovate, knowing their jobs are safe Furloughing - situation in which an organization asks or requires employees to take time off for either no pay or reduced pay - drawbacks o costs are not cut
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