Organizational Behavior

Robbins & Judge

Chapter 18:

Human Resource Policy and Practices

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Summary of Lecture 30

Organizational Structure Characteristics of Bureaucracy Describe Matrix Organization Why managers want to create boundary-less organizations List the factors that favor different organizational structure Explain behavioral implications of different organizational structures

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Learning Objectives

What is HRM Define HRM policy Recruitment and Selection Training and Development Performance Appraisal _ International HRM

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HUMAN RESOURCE MANAGEMENT (HRM)

HRM defined as

“HRM is management function concerned with hiring , motivating and maintaining people in an organization. It focuses on people in organization”

(Aswathappa, 2008, p.5)

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HRM: Peoples Dimensions In Organizations

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HRM: the application of management functions and principles related to employees

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HRM functions applicable every where (not for profit and profit driven organizations)

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Employees decisions are integrated

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Employee decision brings effectiveness/efficiency in organization

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HRM includes all major activities in professional life of a worker

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All activities from employee entry to managing performance and training until he or she leaves

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THE EVOLVING STRATAGICROLE OF HUMAN RESOURCE MANAGEMENT Strategic Human Resource Management

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“Involves development of consistent, aligned collection of practices, programs, & policies to facilitate achievement of strategic objectives” (Mello, 2011, p. 156)

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Mindset & practices away from “personnel management” & focusing on strategic issues instead of operational issues

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HR programs and policies are made and integrated in perspective of mission, objectives, and strategy

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Writing down HR strategy facilitates involvement & convincing senior executives & other employees

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HRM Activities

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HR Planning

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Job Analysis and Design

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Recruitment and Selection

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Training and Development

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Remuneration

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Welfare

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Safe and Healthy Work Environment

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Industrial relations

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SECRETES OF BEST EMPLOYERS

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Effected and committed leadership

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Management of talent

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Spotting and attracting talent

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Setting high goals

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Coaching and training

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Effective appraisal and reward system

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Building skills for future

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Building growth into every job

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HR POLICIES AND PRACTICES

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A policy is plan of action

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HR policies need to ensure consistency and uniformity in treating people (guideline to course of action)

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It motivates employees and build loyalty

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Benchmark to evaluate performance

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HR POLICY DOCUMENT

1 HR Philosophy 2 Employment Policy 3 Compensation 4 Performance evaluation & Employee training

How management/organization views human resource and what value it associates to the employee development. Manpower planning, recruitment, probation, promotion, transfer, termination, retirement policy etc. Work scheduling, overtime, duty hours, holidays.

Pay, benefits, leaves, contributory provident fund, gratuity, GP fund, retirement plans, medical facility, social security, house rent/hiring facility etc. Performance appraisal procedure, methods, and guidelines for training and development of employees.

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HR POLICY DOCUMENT

5 Community Relationships 8 Disciplinary Actions

Social /Community activities, Corporate Social Responsibility, Relationship with project stakeholders.

6 Legal and Ethical Issues

Code of conduct, work ethics, norms, values, information disclosure policy, privacy of personal record and official communications, equal employment opportunity policy, outside work policy etc.

7 Occupational Health and Safety

Smoke free work place, workplace facilities (ergonomics), Health and safety policy and guidelines Procedure for initiating disciplinary proceedings, opportunity of fair trail and hearing, right of appeal, grievance handling procedure, code of conduct. 2-11

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Nature of Job Analysis

Job: Job is bundle of related tasks Work: Synonymous of job and defined as “physical and mental activity that is carried out at a particular place and time, according to the instructions, in return for money” Monetary reward is mandatory for performing of task to be said work in business organization context Psychological perspective is concerned with employee behavior Sociological perspective is concerned with structural and contextual factors affecting individual's experience at work (such as leadership, communication system, power and politics, group dynamics etc) The nature of work and how job is organized affect other human resource functions/activities

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Job Analysis

Job Analysis is the process of collecting data and information about a job and result of job analysis is job description and job specification

Job Analysis

Job Description

Job title Location Job Summary Duties Reporting Authority Machines and tools Materials used Supervision/Subordinate Working conditions Hazards

Job Specification

Statement of individual Qualification necessary to do job Education Experience Training Initiative Physical abilities Psychological abilities Communication skills Responsibilities Sensory demands Adopted from : Aswathappa, 2008, p. 106 13

Recruitment

Recruitment is defined as “the process of searching for and obtaining applicant for jobs, from among whom the right people can be selected” (p. 144) Theoretically recruitment process ends when job applications have been received In practice it goes further to screening applications to filter those applicants who are not eligible for or suitable for job The term recruitment is often described or understood as complete process of employee hiring Recruitment and selection are two different processes

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Purpose of Recruitment

Increase pool of potential job candidates Increase success rate of the selection process Make ensure the right people is selected against vacant position (minimizing probability of leaving organization in case of selection of wrong or misfit candidate) Meeting legal and social obligation of workforce composition Identify and encouraging potential candidates/job applicants Evaluating the effectiveness of available sources and techniques of recruitment

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Source of Recruitment

1 Internal Recruitment Present Employees (Promotion and transfer) Advantages Builds morale Encourages competent employees Good selection Cheaper way Familiar with organization Disadvantages Outside competent candidates Inbreeding

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Source of Recruitment

1 Internal Recruitment Former Employees (Performance is known, aware with organizational culture) Previous Applicants (best when to fill in job quickly, cost effective) 2 External Recruitment Advertisement: The most popular method Blind ad (no identification of company) AIDA (attention, interest, desire, action) Content of Job Advertisement I) job content ii) working conditions iii) location of job v) job specification iv) vi) compensation to whom apply

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Source of Recruitment

Advantages Less costly Better knowledge of skills and performance Morale and Commitment Awareness of culture Internal Sources Disadvantages Candidates current work may be affected Old concept of doing Organizational politics Morale problem for employee not promoted

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External Sources New skills and new experience Compliance with laws Costly and time consuming Right candidate rejected (false positive error) wrong candidate selected (false negative error) Scope for resentment and jealousy reduced Person and organization misfit

Selection

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Selection is defined as

“the process of differentiating between applicants in order to identify and hire those with a greater

likelihood of success in a job” (p. 170) Or

“Selection is the process of picking individuals (out of the pool of job applicants) with requisite qualification and competence to fill jobs in the organization.”

Difference between recruitment & selection In recruitment potential job applicants are attracted and encouraged to apply for vacant position whereas selection focuses on identifying the candidate suitable for the job from pool of job applicants and hire to fill in vacant position

Recruitment and selection are two different processes but often inviting job applications and selecting candidate is called hiring or recruitment process.

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4 5 6 7 8 9

S.No.

1 2 3

Employment Test

Employment Test

General Knowledge IQ Test Personality Test English Proficiency Test Technical/Mechanical Proficiency Test Cognitive Ability Test Reasoning Test Quantitative Ability Physical Ability Test

Example

To judge general knowledge regarding geography, politics, religion etc.

Intelligent quotient test to estimate how quickly candidate processes complex problems To judge type of personality like extrovert, introvert, innovative etc. MBTI is most common and acceptable personality test that uses 8 personality dimensions to elicit 16 personality types To judge English proficiency level For example: What is the meaning of the word exultantly? Asking questions regarding mechanical and technical aspect of job to judge expertise in handling tools, machines, and equipments To judge intellectual and mental capabilities of candidates To judge reasoning capabilities of candidates. Situation is given with certain preconditions to find right answer To judge quantitative skills like processing of numbers For example: Divide 8 by 0.5 then multiple by 0.3

Physical ability of candidates is judged by giving candidates physical tasks to complete in given time frame. Example: Rope climbing, obstacles.

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Guidelines to Interviewers

Do's Plan the interview Build informal relationship Dont's Start the interview without preparation Directly start asking difficult questions Jump to conclusion very early Encourage candidate to talk as much Probe where necessary Allow the candidate to take over session Talking too much Find out interest and preferences of candidate and their strength and weaknesses and behaviors Take control and direct the interview session Start interview with prior perception

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Nature of Training and Development -

In general

“training and development refers to the imparting of specific skills, abilities, and knowledge to employee”

(p. 206) In more detail

“ training and development is any attempt to improve current or future employee performance by increasing an employee's ability to perform through learning usually by changing the employee's attitude or increasing his or her skills and knowledge. The need fro training and development is determined by the employee's performance deficiency”

Training and development need = standard performance -Actual performance Training is process of imparting skills and knowledge Education is theoretical learning given in classroom Development activity aims to give learning opportunities that result in growth of employees

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Inputs in Training

- Skills: Worker should have Skills to operate machinery and other tools.

Managers should have interpersonal skills Education: Teach theoretical knowledge, concepts to develop a sense of judgment and reasoning Education is important for top executives and managers Development: More focus on knowledge. For example knowledge about management principles, business environment, and techniques Any training and development program must have following components - How to create sense of commitment and motivation - How to make them result oriented - How to make themselves aware of needs of others and themselves - How to create sense of leadership and power to influence and lead others

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Training Process

Need Assessment Diagnosis current problems and future needs Individual (performance gap, change in technology, transfer, and Group Level (change in organizations' strategy, new product line, new technology, low moral and motivation) Training need identify the training objectives to be achieved at the end of training program Need Assessment Methods

Source: Aswathappa, Human Resource Management, Text and Cases, 2008, p. 218

Group or Organizational Analysis Organizational goals and objectives Efficiency indices Exit Interviews Quality Circles Customer Survey Individual Analysis Performance Appraisal Interview Questionnaire Attitude Survey Training Progress

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Phase 1 Training Need

Training Process

Phase 2 Training Design Phase 4 Training Evaluation Phase 3 Training Implementation

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Steps in Training Program

Who are the trainees?

Who are the trainers?

What methods and techniques?

Where to conduct the program?

What principles of learning?

What should be the Level of training?

27 Source: Aswathappa, Human Resource Management, Text and Cases, 2008, p. 220

Training Process

Level Result Behavior Learning Measures

Four Levels of Training Evaluation

Is the organization is better because of training?

Are trainees behaving differently in the job after training? Are they using knowledge and skills learned in the training?

To what extent the trainees have greater knowledge of skills after the training program?

Accidents Productivity Cost Morale Profits Turnover Quality Performance, appraisal by supervisor, peer, subordinate, customers Written Tests, Performance tests Reaction Did the trainees like the program, trainer, facilities, timing? Did they think that Questionnaires training was useful? What improvement they suggest?

28 Source: Aswathappa, Human Resource Management, Text and Cases, 2008, p. 230

Performance Appraisal

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Performance appraisal is to evaluate the performance of an employee to determine whether he is performing his given task and duties well or to monitor whether he has given his best effort and performance on given job

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Performance appraisal is an assessment of individual performance, the performance is measured against such factors as job knowledge, quality, quantity of output, initiative, leadership, abilities, supervision, cooperation, judgment, analytical skills, problem solving skills, etc.

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(P. 239)

The other similar terms often used for performance appraisal are performance rating, employee performance review, employee assessment, personal appraisal, employee evaluation, or performance evaluation

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Job Analysis

Performance Appraisal

Performance Standards Performance Appraisal Describe work and professional requirement of a job Translate job requirements into levels of acceptable or unacceptable performance Describe the job relevant strengths and weaknesses of each individual

Relationship of Performance Appraisal and Job Analysis

Source: Aswathappa, Human Resource Management, Text and Cases, 2008, p. 240 30

Multi Purposes of Performance Appraisal

Administrative

Set selection criteria Promotion Retention or termination Identification of poor performers Compensation Evaluate training effectiveness

Developmental

Identification of individual training needs Performance feedback Determining job assignment and transfer Identification of strengths and weaknesses of employee Recognize and appreciate individual performance Goal setting and evaluation Adopted from: Aswathappa, Human Resource Management, Text and Cases, 2008, p. 240 31

Performance Appraisal Process

1 Designing Appraisal Program

What methods?

Formal vs informal When to evaluate?

Whom to evaluate?

Appraisal Design How to solve?

Who are the raters?

What problems/errors?

32 What to evaluate?

360 Degree Performance Appraisal

Advantages Disadvantages

1 More comprehensive 2 Quality of information is better 1 More Complex 2 Conflicting opinion 3 Compliments TQM perspective by soliciting external and internal customers 3 Requires extensive training to implement 4 Grouping may make it ineffective 4 Less bias/prejudice 5 increase employee self development Asian Perspective, (2010, p. 324) 33

Benefits of Proper Compensation

Compensation policy aims to attract talented employees and motivate them to put their efforts and commitment to work that increase job satisfaction work performance

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Benefits of Proper Compensation Administration

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Attracts talent Motivates Employees

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Rewards Performance

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Reduces Turnover

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Manages Compensation Budget

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Treats

Free lunches Coffee breaks Picnics Dinners Birthday treats

Employee Benefits

Knick Knacks

Desk accessories Company watches Diaries/Planners Wallets T-shirts/Ties

Awards

Trophies Certificates Letter of appreciation

Office Environment

Redecoration Flexible hours Furniture Assistant

Social Acknowledgement

Informal recognition Recognition at official party Membership of clubs Use of company facilities for personal events

Tokens

Movie tickets Vacation trips Coupon redeemable at stores Early time offs Anniversary or birthday presents

On the job

More responsibility Special assignments Training 35 Source: Aswathappa. Human Resource Management, Text and Cases, 2008, p. 333

International Human Resource Management

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Globalization has significantly influence HRM practices and policies

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All HRM functions need international orientation

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MNC operating internationally need to be more focused to attract, motivate and transfer workforce globally

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The process of procuring, allocating, motivating, training & development, and compensating and utilizing human resources in international business is called international human resource management

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IHRM covers six main functions of domestic HRM such as HR planning, recruiting, training and development, performance relations management, compensation and labour

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The three countries categories of IHRM are country where headquarter is based, country where subsidiary is located, and country from where workforce and finances come

Managing International HR Activities

1) Cross Cultural Training:

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Expatriate receives pre-departure training on host country culture to make it easy for him/her to adjust to new culture

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Expatriate often receives training on repatriation to avoid cross cultural shock Merits

More chances of success in foreign assignment Provides comprehensive global perspective Sense of confidence

Demerits

May not remove cultural biases Recipient may not take it serious Reduces cultural shock May not make real difference in business Can not prepare manager to face all real life problem 37 Source: Aswathappa. Human Resource Management, Text and Cases, 2008, p. 672 333

Managerial Implications

HR policies and practices are main force in shaping employee behavior and attitude Recruitment and selection process determined who is hired and what is person-job level?

If there is flaw in selection process then more chances of job satisfaction, absenteeism, lower productivity, low OCB and increase turn over Training improves skills and increase potential to perform at higher level Performance appraisal significance influence individual behavior Performance and satisfaction increase when performance appraisal is fair more focus on behaviors and result oriented criteria

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Discussion Questions

Discussion Question 1: How recruitment and selection process affect satisfaction and work performance?

Discussion Question 2: What is role of training and development in shaping work behaviors and performance? Discussion Question 3: What is importance of performance appraisal system?

Discussion Question 4: How HR policies and practices affect individual behavior?

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Summary

What is HRM Define HRM policy Recruitment and Selection Training and Development Performance Appraisal _ International HRM

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