3.6 human resources Flashcards
define human resources
the design, implementation and maintenance of strategies to manage people for optimum business performance to the customer
state the key HR objectives
- diversity
- training
- talent development
- employee engagement
- number, skills + location of employees
- alignment of employee and employer values
define soft HRM
employees are treated as individuals and their needs are planned accordingly
define hard HRM
treats employees simply as a resource of the business
define features of hard HRM
- short-term changes in employee numbers
- minimal communication, from the top down
- little empowerment or delegation
- tall organisation structures
- suits autocratic leadership style
define features of soft HRM
- strategic focus on longer-term workforce planning
- regular two-way communication
- competitive pay structure, with suitable performance-related rewards
- employees are empowered + encouraged to seek delegation
- flatter organisational structures
- suits democratic leadership style
define employee engagement
the extent to which employees feel that they can generally influence the day-to-day running of an organisation, and the outcomes achieve
define talent development
helping the staff in a business, realise their full potential, so they maximise their productivity and are able to improve their contribution to achievement of an organisations objectives
define training
ensuring that employees have the skills necessary to be successful in the job roles
- induction training
- on & off the job training
define diversity
discrimination in terms of gender, race, age, sexual orientation or religion is illegal
many organisations are finding a more diverse workforce = them to be better meet the needs of customers
define alignment of employee + employer values
helping employees to understand the values of business and the business to affect the value is held by employees
define number, skills and location of employees
- labour turnover
- staff retention
- recruitment targets
- training budgets
define the internal influences on HR
- corporate objectives
- operational strategies
- marketing strategies
- financial strategies
define the external influences on HR
- market changes
- economic changes
- technological changes
- social changes
- political and legal changes
define operational strategies
introduction of new IT or other systems and processes may require new staff training, fewer staff
define financial strategies
a decision to reduce cost by outsourcing training would result in changes to training programme
define market changes
a loss of market share to a competitor may require a change in management or job losses to improve competitiveness
define technological changes
the rapid growth of social networking may require changes to the way the business communicates with employees and customers
state two advantages of hard HRM
- enables quicker decision making
- useful when management have expertise
state two disadvantages of HRM
- workers can be demotivated
- does not utilise employee potential
state two advantages of soft HRM
- allows for creativity and innovation
- useful when employees are experienced
state two disadvantages of soft HRM
- decision making can be time-consuming
- high cost to train and develop staff
Define labour turnover
A measure of the rate at which employees are leaving an organisation
Causes of high labour turnover ?
- types of business e.g seasonal staff turnover/flexible working practises
- pay and other rewards
- working conditions
- lack of opportunities for promotion
Consequences of high staff turnover?
- higher costs e.g recruitment + training costs
- increased pressure on remaining staff = may cause demotivation
- disruption to production/productivity
How to improve labour turnover ?
- effective recruitment + training
- provide competitive pay + other incentives
- job enrichment
- reward staff loyalty e.g extra holiday
Define labour productivity
Measure of output per worker in volume (units) or value (£)
What factors influence labour productivity?
- extent + quality of fixed assets i.e equipment, IT systems
- skills, ability and motivation of work force
- production methods
How can labour productivity be improved ?
- measure performance and set clear targets
- automation (invest in capital equipment)
- invest in employee training
- incentives/rewards
What are potential problems when trying to increase labour productivity ?
- potential “trade-off” with quality - higher output must still be of the right quality
- potential for employee resistance
- employees may demand higher pay for their improved productivity
Define labour cost per unit
Average cost of labour per unit of output produced
What is the formula for labour cost per unit ?
Total labour costs / total output
What is employee costs as percentage of turnover ?
The % of an organisations sales venue that is spent on the remuneration of staff
Formula for employee costs as percentage of turnover ?
Employee cost / salves revenue x 100
Employee costs as percentage of turnover:
What does a high/rising figure indicate ?
That labour productivity is falling
Employee costs as percentage of turnover:
What does a low/falling figure may indicate ?
That staff levels are low and customer service may suffer
Define organisational structure
Illustrates how employees and management are organised within a business
Define functional organisational structure
Where organisations are divided into specialist departments
Advantage and disadvantage of functional organisational structure
Advantage = all of the experts are gathered together in one place, helping implement a strategy
Disadvantage = poor communication between the functions, then there is unlikely to be shared best practice
Define regional organisational structure
Where firms operate in distinct areas of a country or internationally
Advantage and disadvantage of regional organisational structure?
Advantage = allowed for localised approach which meets customer needs
Disadvantage = decision making can be decentralised which will add to the overall cost
Define product based organisational structure
Where multi-product firms produce a wide range of different goods
Advantage and disadvantage of product based organisational structure?
Advantage = specialise upon one specific product range which encourages innovation
Disadvantage = inefficient with duplication of certain key roles e.g a marketing department for each division
Define matrix organisational structure
Product and functional based: dual reporting
Advantage and disadvantage of matrix organisational structure ?
Advantage = builds positive relationships and promotes team working
Disadvantage = conflict between project and functional managers
What are the 4 influences on organisational design ?
- authority
- span of control
- hierarchy
- delegation
Define authority
The power/right to give orders and make decisions
Define span of control
The number of employees (subordinates) managed directly by an individual line manager
Define hierarchy
The number of layers in an organisation
Define delegation
Passing down authority to junior employees
Define tall organisational structure
- where there are many levels of hierarchy and many job roles
- easier to delegate
- narrower spans of control
Define flat organisational structure
- where there are few or no levels of middle management between staff and executives
- harder to delegate
- usually wider spans of control
Advantages of tall organisational structure ?
- excellent progression opportunities
- mangers have tight control over employees
Disadvantages of tall organisational structures ?
slow communication + slow decision making due to a long chain of command
Advantages of flat organisational structures?
- less layers = better communication
- more responsibility for employees, leading to motivation
Disadvantages of flat organisational structure?
- lack of progression opportunities
- higher work load for managers
Define centralised
Where decision making is made at the top of the hierarchy
Define decentralised
Where decision making is spread throughout the hierarchy
Advantages of centralised?
- easier to coordinate and control from the centre
- economies of scales and overhead savings easier to achieve
Disadvantages of centralised ?
- a standardised approach may not work in all business locations
- lack of authority down the hierarchy may reduce manager motivation
Advantages of decentralised?
- better able to respond to local circumstances
- improved level of customer service
Disadvantages of decentralised ?
- harder to ensure consistent practices and policies at each location
- harder to achieve tight financial control - risk of cost overruns