2.1 Functions and evolution of human resource management Flashcards
Human resource management
the management function of using and developing people within a business to meet its organisational objectives
Roles of HRM
workforce planning recruitment, selection and induction training and development of staff reviewing pay and remuneration packages disciplinary and grievance procedures looking after the welfare of employees
How can HR add value to the output?
increase productivity
improve quality
come up with new ideas
provide better customer service
Human resource/workforce planning
the management process of anticipating and meeting an organisation’s current and future staffing needs
Short-term workforce planning
deals with the upcoming and existing demands of an organisation
Long-term workforce planning
looks at the human resources needs of the business in the foreseeable future
What does workforce planning look at?
historical data and trends sales and income levels labour turnover rates flexibility and workload of staff demographic changes
Labour turnover
measures the percentage of the workforce that leaves the organisation in a given time period, usually one year
Labour turnover formula
number of staff leaving / total number of staff
x 100
What are the main reasons some people leave their jobs? [CLAMPS]
Challenge Location Advancement Money Pride (Prestige) (Job) Security
What are some internal and external factors that influence human resource planning?
demographic changes
changes in labour mobility
new communication technologies
Why do businesses need to recruit people?
labour is an essential factor of production needed for the provision of any good or service
–> hiring the right people helps to ensure that businesses can function effectively.
Differentiate between internal recruitment and external recruitment.
Internal recruitment involves hiring people who have already been in the organisation to fill out a position, whereas external recruitment hires new employees from outside of the organisation to fill out vacant posts.
Advantages of high labour turnover
Low skilled and productive staff leave and replaced with better workers
New ideas and practices are brought to the company
Business planning to reduce staff
Disadvantages of labour turnover
costs of recruiting, selecting and training
Poor output levels and customer service due to staff vacancies
Difficult to establish team spirit and stable work groups.
Examples of demographic changes that can affect the supply of labour.
Population growth
Net migration
Ageing population
Factors affecting workforce plan
Supply of labour Government Finances Structure of business Effectiveness of communication Morale of workforce Leadership style of managers Need for change/reaction to change
Advantages of internal recruitment
Cost effective
Less time needed to acclimate to company culture
Less risk
Motivational
Disadvantages of internal recruitment
Fewer applicants
Time consuming
No new ideas
Internal politics
Advantages of external recruitment
New blood (wide range of experiences) Larger pool of applicants
Disadvantages of external recruitment
Even more time consuming
Expensive
Uncertainty
Training
Process of providing opportunities for workers to acquire skills and knowledge
Training is the improvement of task-specific skills
Development involves enhancing personal skills that improve workforce flexibility
Advantages of training
Improve efficiency and effectivity Less wastage Higher morale Adapt to change easily Flexible workforce
Disadvantages of training
Cost
Employees may leave since they are qualified for better jobs
Induction
Introduction to company policies, general info
May involve meeting other personnel, touring the premises, etc.
Advantages of induction
Establishes expectations
Understand company culture
Morale booster
Disadvantages of induction
Time consuming
Personnel have to be freed to work on the induction
Info overload
On the job
Learn from coworkers by experience
May involve being mentored by or shadowing senior managers
Advantages of on the job
Relatively cheap
Relevant job-specific skills are learned
Fewer disruptions to work
Establish team relationships
Disadvantages of on the job
Possibility of learning bad working habits
Trainers may lack the best training skills
Trainers may not be able to work properly
Off the job
Learn from specialists from third party (e.g. university, speakers)
Advantages of off the job
Expert expertise
Wide range of training
No distractions
Networking
Disadvantages
Expensive
Loss of output
Skills may be irrelevant
Cognitive
Theoretical training in the hopes of improving overall intelligence
Advantages of cognitive
Improves brain function (memory, reasoning, etc.)
Knowledge may apply to a wide variety of situations
Disadvantages of cognitive
Costly
May not be immediately practical/applicable
Behavioural
Practical training in order to improve employee attitudes/behaviours
Advantages of behavioural
May make for more competent and assertive employees
Improves customer and intra-company relations
Disadvantages of behavioural
Costly
Difficult to track progress
Poor morale is a reason for labour turnover, which is seen in:
Militant workforce
Frequent union representation to management
Low suggestion rates
Widespread rumours
Recruitment process
Establishing the exact nature of the job vacancy and draw up a job description
Draw up a person specification
Prepare a job advertisement reflecting the requirement of the job and the personal qualities looked for
Draw up a shortlist of applicants
Conduct interviews
Employee appraisal
The process of assessing the effectiveness of an employee judged against preset objectives
Reasons for appraisals
Assess performance in line with job description and targets
Identify hindrances
Identify training needed
Reflect on performance (areas for improvement)
Praise good performance
Set new goals/targets
Why are appraisals not done often?
May be costly and time consuming (thus isn’t done often), subjective, offensive, and biased (especially when appraising someone higher up)
Appraisal methods
Formative
Summative
360 degree feedback
Self appraisal
Formative
Qualitative feedback
Gather feedback that can be used by the supervisors to guide improvements in the ongoing work being undertaken
Summative
Goal is to measure the level of an employee’s success or proficiency in meeting predetermined benchmarks.
Used to influence an employee’s pay grade, annual bonus or promotion
360 degree feedback
Collected from ‘all around ‘ an employee/
Does not use supervisor as the sole mean
Assess training and development needs
Self appraisal
Employee to self evaluate his performance
Need for employees to set targets for improvement
Dismissal
Being removed from a job due to incompetence or breach of discipline
Unfair dismissal
Ending a works employment contract for a reason that the law regards as being unfair
What does HR have to do before dismissal?
Must be seen to have done all that it can to help the employee reach the required standard
Redundancy
When a job is not longer required so the employee doing this job becomes redundant through no fault of his or her own
Changing employment patterns and practices factors
Employment sector (primary, secondary, tertiary)
Aging population
Labor supply
Flexible work structures
teleworking/home working
Portfolio/Project based/Contractual working
Part time employment
Flexitime
Advantages of Flexible work structures
Increased flexibility for both
Company needs only to train core employees
Employees exercise more autonomy
Less office overhead expense
Disadvantages of Flexible work structures
Requires investment in ICT, which may be unreliable
Employees are harder to control
Less job security for employees
Outsourcing/subcontracting
Transferring the internal business activities to an external firm
e.g. business outsources bookkeeping duties to accounting firms
Reasons for outsourcing
Activities are not the core function of the business
Business lacks the specific skills
Cost reduction
Advantages of outsourcing
Better focus on core activities
Helps reduce production and labor costs
Ensures high quality standards
Disadvantages of outsourcing
Requires effective two-way communication, coordination and mutual trust
Subcontractors need to be monitored and managed properly
Quality inconsistency
Possibility of unethical practices
Offshoring
Transferring of internal business activities overseas
Usually done in countries with low minimum wage
Reasons for offshoring
Cut down labor costs
Enter new markets in growing countries
Overcome political limitations and regulations
Advantages of offshoring
Reduce labor cost
Help the business expand and gain exposure
Business has access to large talent pool
Stimulate host country’s economy (job opportunities, trade, etc.)
Disadvantages of offshoring
Language and cultural barrier
Time difference
Communication
Reshoring
Bringing back offshore/outsourced personnel and services back to the original location
Reasons for reshoring
Foreign labor costs are increasing
Problems with delivery/logistics
Advantages of reshoring
Greater control
Increased proximity to customers/shorter supply chain
Product quality may increase
Disadvantages of reshoring
May still be more costly
Local country may lack the labor supply
Hard HRM
An approach to managing staff that focuses on cutting cost
Examples of Hard HRM
Using temporary and part-time employment contracts
Offering maximum flexibility but with minimum training costs
Soft HRM
An approach to managing staff that focuses on developing staff so that they reach self fulfilment and are motivated to work hard and stay with the business
Limitations of soft HRM
Global competition leads to low prices being the most important
