Human Resource Management

Hira Nazir
Session 1
Spring 2017
 Human Resource Management
Course Contents
The Strategic Role of HRM
Job Analysis and Job Design
Staffing & Talent Acquisition
Employee Development
Compensation
Employee Relations
Human Resource Management

Course Objectives
Knowledge of HRM Theory, Concepts, Processes and
Practices.
Identifying Sources of Information and using them.
Class Interaction, learning from the Marketplace.
Practical Application of course, developing HRM
Strategies for Organizations.
Performance Assessment: Students nTeacher.
Human Resource Management

Course Requirements

Readings from selected texts, journals

Theory, Concepts discussed in Class
Student Projects and Reports
Guest Speakers, Real Life Cases
Examinations
Presentations and Class Evaluations
Class Participation, Quizzes, Home Assignments
Strategic Human Resource Management

Instructions for Students

Bring Course File to each class
Read reading materials before class
Write notes as slides are explained and discussed
Keep track of Course Calendar, Class Timings, Grades, etc.,
with CR
Maintain contact with CR
Meet Attendance and Punctuality requirements
Discipline is key. Adhere to Class Rules.
 Human Resource Management - Grading
Midterms = 25
Final = 40
Project Report, Presentation = 15
Home Assignments, Quizzes = 5
Class Participation = 5

For an overall A grade in the course:

A in Final
A in Project Report
Active Class Participation
Human Resource Management

1 The Strategic Role of HRM

 Introduction to HRM
Human Resources Strategy in a firm is a firms
deliberate and planned use of human
resources to help it gain a competitive
advantage.

The HRM strategy of a firm is its grand plan to

ensure that it effectively uses its people to
accomplish its mission.
 HRM and Corporate Strategic Goals
Human Resource Management is essential to
advance a firms strategic goals.

CORPORATE Linking Corporate Strategic Goals

STRATEGIC with
GOALS
HRM
CORPORATE
STRATEGY
HR
STRATEGY

HR
TACTICS

HR
HR
PLANS POLICIES,
SYSTEMS,
SOPs HR
PRACTICES
 HRM and the 21st Century
Due to Internet technologies, organizations are undergoing a complete transformation.

The 21st century organization must adapt itself to management via the web.

Intellectual capital will be critical to success. Advantage of bringing new technologies to

the market will be shorter. Technologies will let competitors match them almost
immediately.

In such times, it will be critical to attract and retain the best thinkers.

Retaining and attracting the top talent will require more than just paychecks. It will
require a culture of empowering people, and a reward system that rewards the best as
if they were the owners of the company.

Intellectual capital will be called on from around the globe. A global corporation might
be based in the US but does its software programming in Sri Lanka, engineering in
Germany, its manufacturing in China, and is linked via the Internet to allow employees
to interact and work in real time.
 HRM and the 21st Century Corporation
20th Century Corporation 21st Century Corporation

Predicated itself on stability Predicated itself on constant change

Organized around rigid hierarchies Organized around networks and teams
Built on self-sufficiency Built on shifting partnerships and
alliances
Organizational chart defined as a Organizational chart more likely to be a
shrinking pyramid leading to the CEO flat web, intricately woven that links
partners, employees, external
contractors, suppliers, and customers
in various collaborations
Constructed on bricks and mortar Constructed on knowledge and
technological advantages.
 Outcomes of HRM Practices

HRM practices make an important practical

difference in three key organizational
outcomes.

1. Productivity

2. Quality of Work Life

3. Profit : Total Revenue minus the Total Cost

Outcomes of HRM Practices:

1. Productivity
A measure of the output of goods and services
relative to the input of labor, capital, and
equipment.
Higher productivity
Leads to higher wages without boosting inflation.
Is not working harder, it is working smarter.
Is about doing more with fewer people, less money, less time
and space, and fewer resources.
 MORE PRODUCTIVE ORGANIZATIONS GET MORE GOODS AND
SERVICES FROM A GIVEN AMOUNT OF LABOR, CAPITAL, EQUIPMENT.
Outcomes of HRM Practices:
1. Productivity Improvement

Rebuild employee loyalty.

Establish a clear link between rewards and

production.

Say no to Quick Fix approach.

Emphasize on Continuous Improvement.

Outcomes of HRM Practices:
2. Quality of Work Life
Two ways of looking at Quality of Work Life
(QWL)
Organizational Conditions and Practices such as promotion from
within, democratic supervision, participative management,
employee involvement, safe working conditions, mutual trust,
team work.

Employees Perceptions that they are respected, relatively well

satisfied, and able to grow and develop as human beings and
professionals.
Outcomes of HRM Practices:
3. Profit
Management Systems that produce profits through people share the
following dimensions:

1. Employment Security.

2. Selective Hiring.

3. Self-managed teams and decentralization.

4. High Compensation contingent on organizational performance.

5. Extensive Training, Development and Professional grooming.

6. Reduced differences in status. Respect for competence and performance.

7. Sharing of information, effective communication systems.

8. Employee Care and Satisfaction.

9. Trust.
Outcomes of HRM Practices:
4. Roles of HR Professionals Today
The greatness of an Organisation is due to the Greatness of its People, Eiji Toyoda

1. Strategic Partners: work with multiple stakeholders to achieve business plans.

2. Innovators: create an environment that supports continuous learning and

improvement.

3. Collaborators: create win-win situations with internal and external stakeholders.

4. Change facilitators: anticipate the need for change, think, conceptualize,

articulate, execute and energize organization to bring change.
 HRs Strategic Role
Successful firms align their HR strategies and
tactics with:

1. Environmental Opportunities and Threats.

2. Business Strategies.

3. Organizational Unique Characteristics.

4. Organizations Competence.
 Planning and Implementing Strategic HR

Strategic HR Planning involves:

1. Formulation of HR strategies

2. Designing Programs and Tactics

3. Execution

4. Monitoring Results
1.
The Benefits of HR Planning
Encouragement of proactive rather than reactive behavior

2. Explicit communication of Company Goals

3. Stimulation of critical thinking and ongoing examination of

assumptions

4. Identification of gaps between Current Situation and Future Vision

5. Encouragement of Line Managers Participation

6. Identification of HR constraints and opportunities

7. Teamwork and creation of common bonds

 The Challenges of Strategic HR Planning
1. Maintaining a competitive advantage

2. Reinforcing overall business strategy

3. Avoiding excessive concentration on day-to-day problems

4. Developing HR strategies suited to unique organizational features

5. Coping with the environment

6. Securing management commitment

7. Translating the strategic plan into action

8. Combining intended and emergent strategies

9. Accommodating change
Selecting HR Strategies to Increase Firms Performances

HR Strategys effect on a firms performance

depends on how well it fits with other factors

Fit refers to the consistency and compatibility

between HR strategies and other important
aspects of the organization
 Fit with Organization Strategies
Corporate Strategy is referred to as the mix of
businesses a corporation decides to hold and
the flow of resources among those businesses.
e.g., PARCO

Business Unit Strategies are those that are

formulated and implemented by a firm that is
relatively autonomous, even if it is part of a
larger corporation. eg. PAPCO
Effective HR Strategy Formulation and Implementation
Selected HR Strategies That Fit Miles and Snows Two Major Types of
Business Strategies
 Fit with the Environment
HR strategies should help the organization better exploit
environmental opportunities or cope with the unique environmental
forces that affect it

The relevant environment can be measured in terms of four

dimensions:

1. Degree of uncertainty: how much accurate information is available to

make appropriate business decisions

2. Volatility: how often does the environment change

3. Magnitude of change: how drastic the changes are

4. Complexity: how many different elements in the environment affect

the firm either individually or together

Human Resource
Management by Shah M
Saad Husain
Selected HR Strategies for Firms Low and High on Different
Environmental Characteristics
Fit with Organizational Characteristics
1. The production process for converting inputs into outputs

Routine production process benefits from HR strategies that

emphasize control
example: Specific job description and job specific trainings

Firms with non-routine production processes such as advertising

firms, custom printers, and biotechnology companies, benefit from
flexible HR strategies that support organizational adaptability, quick
response to change and creative decision making
example: Broad job classes, loose work planning, and generic training
 Fit with Organizational Characteristics
2. The Firms Market Posture

Firms that experience high sales growth and engage in product

innovation for a wide market segment benefit from HR Strategies that
support growth and entrepreneurial activities
example: External recruitment or buying skills, decentralized pay decisions,
customized appraisal

Firms with low rates of sales growth and limited product innovation
for a narrow market segment benefit from HR strategies that
emphasize efficiency, control, and firm specific knowledge
example: Internal recruitment or making skills. On-the-job training, and high
dependence on superiors
 Fit with Organizational Characteristics
3. The firms overall managerial philosophy

Companies whose top executives are risk-averse and operate with an

autocratic leadership style, and are inwardly focused use HR
strategies that match this outlook
example: Seniority based pay, formal hiring and socializing of new employees, selection
decisions made by the HR department and use of top-down communication channels.

Management characterized by high risk taking, participation,

egalitarianism, and external, proactive environmental orientation use
HR strategies that fits this outlook
example: include variable pay, giving supervisors a major role in hiring decisions, up-
and-down communication channels, and multiple inputs for performance appraisals
 Fit with Organizational Characteristics
4. The firms organizational structure

Highly formal organizations that are divided into functional

areas like marketing, finance, production, etc, and concentrate
decision making on top: HR strategies for such organizations
include a control emphasis, centralized pay decisions, explicit
job descriptions, and job-based pay.

Firms whose structures are less regimented benefit from HR

strategies that include informal hiring and socializing of new
employees, decentralized pay decisions, broad job classes and
individual-based pay.
 FitThe
5.
with Organizational Characteristics
firms organizational culture

Companies that foster an entrepreneurial climate have loose work

planning, informal hiring and socializing of new employees and variable
pay.

Firms that discourage entrepreneurship generally prefer a control

emphasis, detailed work planning, formal hiring and socializing of new
employees, and fixed pay.

Firms with emphasis on moral commitment- the extent to which a firm

tries to foster a long-term emotional attachment between the firm and
the employees have emphasis on preventive vs. remedial disciplinary
action to handle employee mistakes, and explicit ethical codes to monitor
and guide behavior.

Firms that are low on moral commitment rely on authoritarian

relationship between employee and company.
Fit with Organizational Capabilities
Distinctive competencies of a firm are its
capabilities such as technology, management
systems, reputation, etc, that give it a
Competitive Edge
HR strategies should enhance a firms
performance by:
1. helping the company exploit its specific advantages or strengths while
avoiding weaknesses

2. assisting the firm in better utilizing its unique blend of human

resource skills and assets
 Choosing consistent and appropriate HR tactics to implement
HR strategies

The best-laid HR strategies may fail when specific HR programs are poorly
chosen or implemented

In addition to fitting with each of the four organizational characteristics;

organizational strategy, environment, organizational capabilities and
characteristics, a firms HR strategies should be mutually consistent

HR strategies are likely to be successful if they reinforce one another

rather than work at cross-purposes.
example: Working in teams, but traditional individual based performance
appraisals
Choosing Consistent and Appropriate HR Tactics to Implement
HR Strategies
Competencies Required of HR Department to Become a Full Strategic Partner