Transcript Slide 1

Chapter 1
Human Resource Management:
Gaining a Competitive Advantage
Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
Learning Objectives
1. Discuss roles and activities of HRM function
2. Discuss implications of the economy, makeup of the
labor force and ethics for company sustainability
3. Discuss how HRM affects a balanced scorecard
4. Discuss what companies should do to compete in global
marketplace
5. Identify how technology such as social networking is
influencing HRM
6. Discuss HRM practices that support high-performance
work systems
7. Provide a brief description of HRM practices
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Introduction
 Competitiveness – a company’s ability to maintain
and gain market share.
 Human resource management (HRM) – the
policies, practices, and systems that influence
employees’ behavior, attitudes and performance.
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HRM Practices
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Responsibilities of HR Departments
1. Employment and Recruiting
2. Training and Development
3. Compensation
4. Benefits
5. Employee Services
6. Employee and Community Relations
7. Personnel Records
8. Health and Safety
9. Strategic Planning
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HR as a Business with 3 Product Lines
Business
Partner
Services
Strategic Partner
Human
Resources
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6 HR Competencies
Cultural
Steward
Credible
Activist
Talent
Manager/
Strategic
Organizational
Architect
Designer
Business
Ally
Operational
Executor
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Strategic Role of the HRM Function
 Time spent on administrative tasks is decreasing.
 HR roles as a strategic business partner, change
agent and employee advocate are increasing.
 HR is challenged to shift focus from current
operations to future strategies and prepare non-HR
managers to develop and implement HR practices.
 This shift presents two challenges:
 Self-service
 Outsourcing
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Shared Service Model
Shared Service Model is a way to organize the HR
function that includes centers of expertise or
excellence, service centers and business partners
to help control costs and improve businessrelevance and timeliness of HR practices.
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HR’s Strategic Role in the Business
1. What is HR doing to provide value-added services to internal clients?
2. How are you measuring HR effectiveness?
3. How can we reinvest in employees?
4. What HR strategy will get the business from point A to point B?
5. What makes an employee want to stay?
6. How will we invest in HR for a better HR department than competitors?
7. What should we be doing to improve our marketplace position?
8. What’s the best change to prepare for the future?
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How is the HRM Function Changing?
 As part of its strategic role, HR can engage in
evidence-based HR.
 Evidence-based HR – demonstrating that HR
practices have a positive influence on the
company’s bottom line or key stakeholders.
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The HRM Profession
 HR salaries vary according to position,
experience, education, training, location and firm
size.
 The primary professional organization for HRM is
the Society for Human Resource Management
(SHRM) (www.shrm.org)
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3 Competitive Challenges
Influencing HRM
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The Sustainability Challenge
 Sustainability is the ability of a company to
survive and succeed in a dynamic competitive
environment.
 Stakeholders include shareholders, the
community, customers and all other parties
that have an interest in seeing that the
company succeeds
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The Sustainability Challenge
Sustainability includes the ability to:
 deliver a return to shareholders
 provide high-quality products, services and work
experiences for employees
 increase value placed on intangible assets,
human capital and social responsibility
 adapt to changing characteristics and
expectations of the labor force
 address legal and ethical issues
 effectively use new work arrangements
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Economy - Implications for HR
Structure of the economy
Social collaboration and social networking technology
Growth in professional and service occupations
Changing job skill demands
Intangible assets
 Knowledge workers
 Empowerment
 Learning organization
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Change and Its Effect on Employment Relationships
Psychological
Contract
Alternative
Work
Arrangements
Changes in
Employment
Expectations
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Common Themes Employee Engagement
 Pride and satisfaction with employer and job
 Opportunity to perform challenging work
 Recognition and positive feedback from contributions
 Personal support from manager
 Effort above and beyond the minimum
 Understanding link between one’s job and company’s mission
 Prospects for future growth with the company
 Intention to stay with the company
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Talent Management
 Talent management is the systematic planned strategic
effort to use bundles of HRM practices acquiring and
assessing employees, learning and development,
performance management and compensation to attract,
retain, develop and motivate highly skilled employees and
managers.
 Alternative work arrangements include independent
contractors, on-call workers, temporary workers, and
contract company workers.
 Demanding Work, but with more flexibility.
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Balanced Scorecard and Social Responsibility
Balanced scorecard provides a view of the company from the
perspective of internal and external customers, employees and
shareholders and is used to:
 Link HRM activities to company’s business strategy.
 Evaluate extent HR is helping meet company’s strategic
objectives.
 Questions to identify HR related critical indicators or metrics:
1.
2.
3.
4.
How do customers see us?
What must we excel at?
Can we continuously improve and create value?
How do we look to shareholders?
Social, ethical and environmental responsibility
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Customer Service and Quality
Customers expect excellent service.
Total Quality Management (TQM) Core Values
• Methods and processes are designed to meet internal and
•
•
•
•
external customers’ needs.
Every employee receives training in quality.
Promote cooperation with vendors, suppliers and
customers.
Managers measure progress with feedback based on data.
Quality is designed into a product or service so that errors
are prevented rather than being detected and corrected.
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Customer Service and Quality
 Malcolm Baldrige National Quality Award
 ISO 9000:2000
 Six Sigma Process
 Lean Thinking
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Changing Demographics and Workforce Diversity
 Internal labor force - current employees
 External labor market - persons outside the firm actively
seeking employment
 Average age of U.S. workforce will age.
 Increased workforce diversity
 Influence of immigration
 Generational differences.
 Gender and racial composition of the workforce
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Legal Issues
 Employment laws and regulations
 Eliminating discrimination and harassment
 Workplace safety
 Data security practices and protecting intellectual property
 Electronic monitoring and surveillance
 Employee privacy rights, intellectual property rights and social media
 Federal health care legislation
 Companies who employ unlawful immigrants or abuse laborers
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Ethical Issues
 Ethics - fundamental principles of right and wrong by which
employees and companies interact
 Ethical HR practices:
 HRM practices must result in greatest good for largest number of
people
 Employment practices must respect basic human rights of privacy,
due process, consent, and free speech
 Managers must treat employees and customers equitably
and fairly
 Develop and distribute a Code Of Ethics, policy, process
and procedures, audit and train employees
 Sarbanes-Oxley Act of 2002
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4 Principles of Ethical Companies
Emphasize
mutual
benefits in
customer,
vendor, client
and
community
relationships.
Employees
assume
responsibility
for the
actions of the
company.
Sense of
purpose or
vision the
employees
value and use.
Emphasize
fairness;
another
person’s
interests
count as
much as their
own.
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Global Challenges
Offshoring –
exporting jobs from
developed countries
to less developed
countries
Onshoring –
Onshoring
exporting
jobs–to
exporting
to
rural
parts jobs
of the
rural
parts
of the
United
States
United States
Companies must deal
Companies
deal
with themust
global
with thecompete
global in
economy,
economy,
compete
and develop
globalin
and develop
global
markets
and prepare
markets
andfor
prepare
employees
global
employees
for global
assignments.
assignments.
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Technology Challenge
Advanced
technologies
Internet
Social networking
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HRIS, Cloud Computing, and HR Dashboards
HR Information
Systems (HRIS)
HR
Dashboard
Metrics
Advances in
technology
have
increased:
Cloud
computing
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High-Performance Work Systems
 Work Teams, Virtual Teams and Partnerships
 Changes in Skill Requirements and new technology
 Changes in Company Structure and Reporting
Relationships.
 HRM practices support high-performance work systems
through staffing, work design, training, compensation and
performance management.
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Meeting 4 Competitive Challenges
Through HRM Practices
Dimensions of HRM Practices
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•
•
•
HR environment
Acquiring and preparing HR
Assessment and development of HR
Compensating HR
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Meeting Competitive Challenges
Through HRM Practices
 Managing internal and external environmental
factors allows employees to make greatest possible
contribution to company productivity and
competitiveness.
 Customer needs for new products or services
influence the number and type of employees
businesses need to be successful.
 Assessment, Development and Compensation of HR
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Summary
 HR has three product lines: administrative services,
business partner services, and strategic services.
 HR managers need personal credibility, business and
technology knowledge, understanding of business
strategy, and ability to deliver HR services.
 HR practices are important for helping companies deal
with sustainability, globalization, and technology
challenges and should be evidence-based.
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