Chapter 13
Human Resource Management
Once an organization’s structure is in place, it’s time to find the people to fill the jobs that
have been created. That’s where human resource management comes in.
It’s an important task that involves getting the right number of the right people in the right
place at the right time. Focus on the following learning objectives as you read and study
this chapter.
LEARNING OBJECTIVES
1. Explain the importance of the human resource management and the human
resource management process.
2. Describe the external influences that affect the human resource management
process.
3. Discuss the tasks associated with identifying and selecting competent employees.
 Know how to write effective job descriptions.
 Develop your skill at being a good interviewer.
4. Explain how companies provide employees with skills and knowledge.
5. Describe strategies for retaining competent, high-performing employees.
6. Discuss contemporary issues in managing human resources.
It’s Your Career
Negotiating Your Salary
After receiving a job offer take time to review the offer. Ask any questions that have
come up since your interview and consider whether the salary being offered represents
your worth. If you think it’s too low, try negotiating for a higher amount. Here are some
suggestions for helping you negotiate for a higher salary:
1. Do you want the job? This is perhaps the most important question you must
answer. Set pay considerations aside and weigh the pros and cons of the job.
2. Research what similar companies pay new hires. It’s important to consider a
variety of sources to ensure that you understand the pay norm for your job offer.
3. Make sense of the data. Look at whether companies in different industries pay
similarly
4. Prepare for the pay discussion. Think about your reservation pay rate; that is,
the lowest amount you are willing to accept. Come up with a range of pay rather
than a single amount.
5. Have the discussion. Thank the organization’s representative for making the job
offer and express your excitement about the opportunity. Briefly summarize how
you will become a productive member of the team.
6. Communicate your decision. If you plan to accept the offer, tell the
representative that you will do so promptly after receiving written confirmation.
CHAPTER OUTLINE
INTRODUCTION
The quality of an organization is, to a large degree, dependent upon the quality of
the people it hires and retains. Chapter 13 examines the concepts of human
resource management.
13.1
WHY THE HRM IS IMPORTANT AND THE HRM PROCESS
Various studies have concluded that an organization’s human resources can be
an important strategic tool and can help establish a firm’s sustainable competitive
advantage.
A.
Human resource management (HRM) is important for several reasons:
1.
Various studies have shown HRM can be a significant source of
competitive advantage.
2.
HRM is an important part of organizational strategies.
3.
Studies that have explored the link between HRM policies and
practices and organizational performance have found that certain
HRM policies and practices have a significant impact on
performance.
a.
These high-performance work practices are human
resource policies and practices that lead to both high
individual and high organizational performance.
b.
Examples of high-performance work practices are shown
in Exhibit 13-1.
2.
The human resource management process consists of eight
activities necessary for staffing the organization and sustaining
high employee performance. See Exhibit 13-2.
13-2. EXTERNAL FACTORS THAT AFFECT THE HRM PROCESS.
A number of environmental forces constrain human resource management
activities.
The factors most directly influencing the HRM process are economic conditions,
employee labor unions, governmental laws and regulations, and demographic
trends.
A.
The Economy.
1.
Recent economic changes have had a profound impact on the
nature of work. Unemployment (and under employment) is high in
most developed countries due to the latest recession felt
worldwide. Economic news, whether good or bad, has an effect
on employment, attitudes toward work, careers, and retirement.
B.
Labor Unions.
1.
Unionization can affect a company’s human resource
management activities.
a.
A labor union is an organization that represents workers
and seeks to protect their interests through collective
bargaining.
b.
Good labor-management relations, the formal interactions
between unions and an organization’s management, are
important.
c.
C.
D.
Only about 11.1 percent of the workforce in the United
States is unionized; that percentage is higher in other
countries.
Laws and Rulings.
1.
Federal laws and regulations have greatly expanded the federal
government’s influence over HRM (see Exhibit 13-3).
a.
Balance of the “should and should-not’s” of many of these
laws often fall within the realm of affirmative action—
programs that enhance the organizational status of
members of protected groups.
b.
Managers that operate in an international context must
also be aware of specific laws that apply to the countries in
which they do business. Canadian laws most closely mirror
those in the United States. In Mexico, employees are
more likely to be unionized. In Australia, discrimination
laws are fairly new and generally apply to affirmative action
for women. In Germany, companies are required to have a
high degree of worker participation in management
through the use of work councils and board
representatives.
Demography.
1.
Demographic trends will continue to play an important role in the
Human Resource function as the pool of workers change, i.e.,
increase in older workers ready for retirement and greater ethnic
diversity due to an increasing number of Hispanics residing in the
United States.
a.
The oldest, most experienced workers (those born before
1946) make up 6 percent of the workforce.
b.
The baby boomers (those born between 1946 and 1964)
make up 41.5 percent of the workforce.
c.
Gen Xers (those born from 1965 to 1977) make up almost
29 percent of the workforce.
d.
Gen Yers (those born from 1978 to 1994) make up almost
24 percent of the workforce.
LEADER MAKING A DIFFERENCE
As senior vice president of people operations at Google Inc., Laszlo Bock knows and
understands people and work. You shouldn’t be surprised that the comprehensive (and
complicated) analysis that goes into Google’s search efforts also characterizes its
approach to managing its human resources. Bock’s current pursuit is a long-term study
of work (patterned after the long-running Framingham Heart Study that transformed what
we know about heart disease). Bock says, “I believe that the experience of work can
be—should be—so much better.” He and his team hope to learn more about work-life
balance, improving employee well-being, cultivating better leaders, doing a better job of
engaging Googlers (the name for Google employees) long-term, and how happiness and
work impact each other. Undoubtedly, there will be some interesting insights that result!
(P.S. If you’d like to work at Google and want to know more about getting hired, check
out the references cited above! There are good tips in there!)
What can you learn from this leader making a difference?
Student answers to these questions will vary.
13.3
IDENTIFIYING AND SELECTING COMPETENT EMPLOYEES
The first phase of the HRM process involves three tasks: human resource
planning, recruitment and decruitment, and selection.
A.
Human Resource Planning. Human resource planning is ensuring that
the organization has the right number and kinds of capable people in the
right places at the right times.
1.
Current Assessment. Managers begin HR planning by conducting
a current assessment of the organization’s human resource
status.
a.
This assessment is typically accomplished through a
human resource inventory.
b.
Another part of the current assessment process is the job
analysis, which is an assessment that defines jobs and
the behaviors necessary to perform them.
c.
From this information, management can draw up a job
description (or position description), which is a written
statement that describes a job.
d.
In addition, management must develop a job
specification, which is a statement of the minimum
qualifications that a person must possess in order to
perform a given job successfully.
2.
Meeting Future HR Needs. Future HR needs are determined by
looking at the organization’s mission, goals, and strategies.
Developing a future program requires estimates in which the
organization will be understaffed or overstaffed.
3.
Increased Scrutiny in the Selection Process. Companies that do
not carefully scrutinize the qualifications or backgrounds of
employees surely pose risks of increased liability, poor reputation,
and lower performance.
B.
Recruitment and Decruitment.
1.
Recruitment is the process of locating, identifying, and attracting
capable applicants. Job candidates can be found using a number
of different sources (see Exhibit 13-4).
2.
Decruitment is reducing an organization’s workforce. Decruitment
options include firing, layoffs, attrition, transfers, reduced
workweeks, early retirements, and job sharing (see Exhibit 13-5).
C.
Selection. Selection is screening job applicants to ensure that the most
appropriate candidates are hired. Selection is an exercise in prediction.
1.
Prediction is important because any selection decision can result
in four possible outcomes (see Exhibit 13-6). The major aim of
any selection activity should be to reduce the probability of making
reject errors or accept errors, while increasing the probability of
making correct decisions.
2.
Validity and Reliability. Validity is the proven relationship that
exists between a selection device and some relevant job criterion.
3.
4.
Reliability is the ability of a selection device to measure the same
thing consistently.
Types of Selection Devices. Managers can select employees
using numerous and varied selection devices. Exhibit 13-7 lists
the strengths and weaknesses of each of these devices.
Realistic Job Previews. A realistic job preview is a preview of a
job that provides both positive and negative information about the
job and the company. Including an RJP can increase job
satisfaction among employees and reduce turnover.
13.4
PROVIDING EMPLOYEES WITH THE NEEDED SKILLS AND KNOWLEDGE
A.
Orientation. Orientation is introducing a new employee to his or her job
and the organization.
1.
Work unit orientation familiarizes the employee with the goals of
the work unit, clarifies how his/her job contributes to the unit’s
goals, and includes an introduction to his or her coworkers.
2.
Organization orientation informs the new employee about the
organization’s objectives, history, philosophy, procedures, and
rules.
3.
Major objectives of orientation include the following:
a.
To reduce initial anxiety.
b.
To familiarize new employees with the job, the work unit,
and the organization.
c.
To facilitate the outsider-insider transition.
4.
Formal orientation programs are prevalent in many organizations,
particularly in large ones. Managers have an obligation to new
employees to ensure that their integration into the organization is
as smooth and as comfortable as possible.
B.
Employee Training. Employee training is a critical component of the
human resource management program.
1.
Types of Training. Types of training include general and specific.
See Exhibit 13-8.
2.
Training Methods. Exhibit 13-9 describes the major types of
training that organizations provide.
a.
Traditional Training methods. On-the-job training is very
common, and it may involve job rotation. Job rotation is onthe-job training that involves lateral transfers to enable
employees who work on the same level of the organization
to work in different jobs. On-the-job training can also
involve mentoring, coaching, experiential exercises, and
classroom training.
b.
Technology-driven training methods. Today’s organizations
are increasingly relying on technology-based training,
including e-learning applications, to communicate
important information and to train employees.
12.5
RETAINING COMPETENT, HIGH-PERFORMING EMPLOYEES
A.
Employee Performance Management. Managers need to know
whether their employees are performing their jobs efficiently and
effectively or whether improvement is needed. A performance
B.
management system establishes performance standards that are used
to evaluate employee performance.
1.
Performance Appraisal Methods (Exhibit 13-10 summarizes the
advantages and disadvantages of each of these methods.)
a.
A written essay appraises performance through a written
description of an employee’s strengths and weaknesses,
past performance, and potential.
b.
Critical incidents are used to appraise performance by
focusing on the critical job behaviors. In this technique, the
appraiser writes anecdotes to describe what the employee
did that was especially effective or ineffective. Only specific
behaviors, rather than vaguely defined personality traits,
are cited.
c.
The use of graphic rating scales is one of the oldest and
most popular performance appraisal methods. This method
appraises performance using a rating scale on a set of
performance factors. Graphic rating scales list a set of
performance factors; the evaluator goes down the list and
rates the employee on each factor, using an incremental
scale.
d.
Using behaviorally anchored rating scales (BARS) is an
appraisal approach that appraises performance using a
rating scale on examples of actual job behavior. BARS
combines major elements from the critical incident and
graphic rating scale approaches. The appraiser rates an
employee according to items along a scale, but the items
are examples of actual behavior on the job rather than
general descriptions or traits.
e.
Multiperson comparison appraises performance by
comparing it with others’ performance.
f.
Management by objectives (MBO) is another mechanism
for appraising performance. It is often used to assess the
performance of managers and professional employees.
g.
360 degree feedback appraises performance by using
feedback from supervisors, employees, and coworkers.
Compensation and Benefits.
How do organizations determine the compensation levels and benefits
that employees will receive?
1.
The purpose of having an effective reward system is to attract and
retain competent and talented individuals who can help the
organization achieve its mission and goals.
2.
A compensation system can include base wages and salaries,
wage and salary add-ons, incentive payments, and benefits and
services.
3.
What factors determine the compensation and benefits packages
for different employees? A number of factors influence these
differences (see Exhibit 13-11):
a.
Under a skill-based pay system, employees are
compensated for the job skills they can demonstrate.
Research shows that skill-based pay systems tend to be
b.
c.
13.6
more successful in manufacturing organizations than in
service organizations.
Under a variable pay system, an individual’s
compensation is contingent on performance.
Flexibility is becoming a key consideration in the design of
an organization’s compensation system.
CONTEMPORARY ISSUES IN MANAGING HUMAN RESOURCES
A.
Managing Downsizing. Downsizing is the planned elimination of jobs
in an organization; it is a challenge for management in a tight economy.
Downsizing can occur when management faces (1) a poor management
past, (2) declining market share, and/or (3) overly aggressive
organizational growth.
1.
Exhibit 13-12 lists some ways that managers can lessen the
trauma both for the employees being laid off and for the survivors
B.
Managing Sexual Harassment. Sexual harassment is any unwanted
action or activity of a sexual nature that explicitly or implicitly affects an
individual’s employment, performance, or work environment.
1.
Sexual harassment isn’t a problem just in the United States. It’s a
global issue. Studies show that 40 to 50 percent of female
employees in European Union countries, 33 percent in Australia,
and up to 56 percent in Japan have experienced some form of
sexual harassment. Sexual harassment charges have also been
filed against employers in other countries such as New Zealand
and Mexico.
2.
What can an organization do to protect itself against sexual
harassment claims? The courts want to know two things: First,
did the organization know about, or should it have known about,
the alleged behavior? And secondly, what did managers do to
stop it?
FUTURE VISION
Many organizations are exploring gamification as a way to engage employees and
potential job applicants. Games can be used during the hiring process, to orient new
employees, to provide training, to support career development, or even to help support
team-building efforts. Why does gamification work? It works because it taps into the
natural human instinct for competition and recognition – and because games are fun!
The following discussion questions are posed:
Talk About It 1: What would you think of a company that used a gaming application as
part of its hiring process?
Talk About It 2: What are some cautions for human resources practitioners in using
gamification?
Student answers to these questions will vary.
C.
Controlling HR Costs.
1.
2.
Employee Health Care Costs. With health care costs rising
rapidly, it is important for employers to keep their portion of what
they pay for health insurance low. Two factors that affect what
employers pay for their premiums are smoking and obesity. To
keep costs low, employers are responding by offering wellness
programs, reimbursing employees for health club costs (or
providing fitness equipment and classes on site), and offering
healthy food choices in their cafeterias.
Employee Pension Plan Costs. Employee pension plans are other
increasing costs. The choice for employers is whether to suspend
offering pension plans or to continue to offer new retirement
choices to attract employees.
ANSWERS TO REVIEW AND DISCUSSION
QUESTIONS
Student answers to these questions will vary.
13-1. Can labor unions help prevent employees from being unfairly terminated?
Economic turmoil provides different challenges for the employer and employee alike.
Understandably employers would desire a flexible company response to unexpected
economic outcomes. The ability to hire lower-paid employees as well as letting
employees go are just some of the common solutions used by management to deal with
economic uncertainties. However, this is exactly what the labor unions are designed to
protect the employees against. So, is the conflict between the two inevitable? The
answer is ultimately to find the perfect balance between company bottom line
performance and the protection of employee rights. Also, in the absence of
governmental intervention, there may well be more labor unions. (LO:2, Describe the
external influences that affect the human resource management process, AACSB:
Analytical thinking)
13-2. In Malaysia, certain job sectors, like IT and customer services, are increasingly
dependent on specialist human resource providers as a common source of trained
manpower. Companies like ManpowerGroup provide professional HRM services to
clients. Can such companies make HR departments redundant? Discuss.
For those companies lacking in HRM skills to select and hire qualified professionals,
companies like ManpowerGroup that provide professional HRM services are indeed a
boon if they can afford their services. It brings attention to difficult questions as to why
the company’s own HR department is lacking in skills. Certain functions of the HR
department may be made redundant as a result, but the core functions traditionally
associated with the department will still be retained (LO: 2, Describe the external
influences that affect the human resource management process, AACSB: Analytical
thinking)
13-3. Organizations use many methods to assess potential new employees. Are these
methods fair?
Organizations may use a variety of assessment tools to assess a potential employee,
like written tests, assessment centres, interviews, and background investigations. These
are good tools for the purpose, which explains their continued use. However, the
question of how impartially they are applied is specific to organizations. (LO: 3, Discuss
the tasks associated with identifying and selecting competent employees, AACSB:
Analytical thinking)
13-4. With organizational cost-cutting the world over, orientation for new staff has been
cut short to just several days. How will this affect retention?
Corporate orientation programs are important because it results in a smoother outsiderinsider transition that makes an employee feel comfortable and well-adjusted, and
lowers the likelihood of lower work performance and increases job retention and
organizational loyalty. Some corporate orientation programs used to last a week to a
month, with graduation ceremonies for each new cohort and included tasks where the
new employees bonded with other new co-workers and got to know the organization
better. A corporate orientation course that lasts only a few days risks inducting
employees with “this is just another job” mentality and as a result is less effective in
achieving its goals. (LO: 4, Explain how companies provide employees with skills and
knowledge, AACSB: Analytical thinking)
13-5. Describe the two main types of training. How do you think these tend to be
delivered?
There are two broad types of training that can be offered. They are general and specific.
A general training would include skills such as communication, customer service,
technological knowledge, personal growth. A specific training method focuses on the
profession or the industry and skills specific to that area. These may include training in
management and supervision, an education in diversity, cultural awareness, and
leadership among many others.
Students should be encouraged to put forward different examples. They should look at
whether the training offered is an on-the-job process, whether it involves job rotation,
mentoring and coaching, development exercises, references to manuals and workbooks,
or whether they have to attend lectures modeled on classroom activities that are
designed to convey very specific information. (LO: 3, Learning Outcome: Explain the
different types of orientation and training, AACSB: Reflective thinking skills)
13-6. Distinguish between MBO and BARS as appraisal methods.
MBO focuses on goals, is results orientated, and time consuming. BARS focuses on
specific and measurable job behaviors. (LO: 4, Learning Outcome: Describe strategies
for retaining competent, high performing employees, AACSB: Reflective thinking skills)
13-7. How do you think downsizing should be handled?
Downsizing should be handled by treating everyone with respect; by being honest and
open; by following legal requirements; by providing support; by reassigning roles
according to talent and background; by focusing on boosting morale; and by having a
plan to deal with empty space in the office. (LO: 6, Learning Outcome: Discuss
contemporary issues in managing human resources, AACSB: Reflective thinking skills)
13-8. What do you understand by the term family-friendly benefits? Give some examples
of these benefits in action.
These types of benefits try to accommodate employee needs for work-family life
balance. Examples include childcare; summer day camps; flexible timing; job shares;
telecommuting; and part time posts. (LO: 6, Learning Outcome: Discuss contemporary
issues in managing human resources, AACSB: Reflective thinking skills)
PERSONAL INVENTORY ASSESSMENTS
Student answers to these questions will vary.
ETHICS DILEMMA
Student answers to these questions will vary.
Though it might be a challenge, employing individuals with autism could pay off. Britain’s
National Autistic Society reported only 15 percent of adults with autism are in full-time
employment, while 9 percent work part-time; this despite 79 percent actually wanting to
work. It’s not that people with autism don’t have the necessary skills or drive but that
employers don’t understand the empirical benefits of employing them—benefits that go
beyond corporate social responsibility or charity. While the attitude of employer’s
towards the young workforce with autism is changing there is still a considerable amount
of ground to be covered. The British government set up a working group that brought
together employees and charities. Collectively they were asked to look at the best ways
to harness this pool of untapped talent. One of the things that they discovered was a
need for an autism-friendly environment. A few minor adjustments, such as ensuring that
the workplace is not too bright or too loud, could make a quite a difference.
13-11. Research and describe the steps being made in your country with regard to
autistic employees or those with other challenges.
13-12. Should ethical and diverse recruitment be considered when profit is an
organization’s primary goal?
(LO: 6, Discuss contemporary issues in managing human resources, AACSB: Reflective
thinking)
SKILLS EXERCISE: DEVELOPING YOUR
INTERVIEWING SKILLS
This exercise should help students develop their interviewing skills. After giving seven
tips for interviewing, students are asked to review and update their résumé. It would be
helpful if students were to have several friends who have experience in management
critique it. Next, students are asked to create an inventory of their interpersonal and
technical skills and any practical experiences that do not show up in their résumé.
Finally, students should draft a set of leading questions they would like to be asked in an
interview that would give them a chance to discuss the unique qualities and attributes
they could bring to the job. (LO: 3, Discuss the tasks associated with identifying and
selecting competent employees, AACSB: Written and oral communication)
WORKING TOGETHER: TEAM EXERCISE
Students are asked to reflect on their experiences with employee orientation. After
writing down notes about the employee orientation process at their last job, students are
asked to think about what the orientation taught them about the organization and what
information was not provided that could have been helpful to them in the job. Then,
working in groups of three or four, students are asked to create a list of orientation “dos
and don’ts” for companies.
(LO: 4, Explain how companies provide employees with skills and knowledge, AACSB:
Analytical thinking)
MY TURN TO BE A MANAGER

Studies show that women’s salaries still lag behind men’s, and even with equal
opportunity laws and regulations, women are paid about 82 percent of what men
are paid.126 Do some research on designing a compensation system that would
address this issue. Write up your findings in a bulleted list format. (LO: 6, Discuss
contemporary issues in managing human resources, AACSB: Analytical thinking)

The American Federation of Labor and Congress of Industrial Organizations is a
national trade union center and the largest federation of unions in the United
States. Visit the organization’s website at www.aflcio.org. Explore the website
and identify issues that are of current concern for today’s labor unions. (LO: 6,
Discuss contemporary issues in managing human resources, AACSB: Reflective
thinking)

Go to the Society for Human Resource Management website (www.shrm.org)
and look for the HR News. Pick one of the news stories to read. (Note: Some of
these may be available only to SHRM members, but others should be generally
available.) Write a summary of the information. At the end of your summary,
discuss the implications of the topic for managers. (LO: 6, Discuss contemporary
issues in managing human resources, AACSB: Reflective thinking)

Find Fortune’s “Best Companies to Work For” list online. Read the profiles of the
top companies. Identify the types of benefits and other company characteristics
that are common among these companies. Collect this information in a formal
report you can present to your class. (LO: 5, Describe strategies for retaining
competent, high-performing employees, AACSB: Analytical thinking)

Visit an online job board and learn about how a company posts a job. Pick any
online job board such as www. monster.com, www.careerboard.com, or a local
job board in your area. Click on “Employers” tab and read about the process to
post a job. (LO: 3, Discuss the tasks associated with identifying and selecting
competent employees, AACSB: Multicultural and diversity understanding)

Work on your résumé. If you don’t have one, research what a good résumé
should include. If you have one already, make sure it provides specific
information that explicitly describes your work skills and experience rather than
meaningless phrases such as “results-oriented.” (LO: 3, Discuss the tasks
associated with identifying and selecting competent employees, AACSB:
Analytical thinking)

Set up a profile on LinkedIn. Make sure you use a professional photo and provide
a complete profile. Click on the “Business Services” link to learn how companies
can use LinkedIn in the hiring process. (LO: 3, Discuss the tasks associated with
identifying and selecting competent employees, AACSB: Analytical thinking)

Search online for a sample sexual harassment training program. How could an
organization use this training program to help prevent harassment in the
workplace? (LO: 6, Discuss contemporary issues in managing human resources,
AACSB: Reflective thinking)
ANSWERS TO CASE APPLICATION 1
QUESTIONS
Student answers to these questions will vary.
Maersk and HR Management Challenges in China
13-13. Why does human resource management represent one of the major challenges
faced by foreign companies entering the Chinese market?
Cultural differences between Western countries and East Asia are huge, and this is
especially relevant when coming to personal aspects of management. Distance,
language and difficulties in relocating are among the most common issues. (LO: 1,
Explain the importance of the human resource management process and the external
influences that might affect that process, AACSB: Analytical thinking)
13-14. What are the main issues expat managers generally face?
There are a few, but difficulties in integrating in the local environment and adapting
western work practices to Chinese standards are among them. (LO: 1, Explain the
importance of the human resource management process and the external influences
that might affect that process, AACSB: Analytical thinking)
13-15. Why don’t foreign companies simply hire local staff instead of reaching out for
foreign managers?
The easy answer is that before there were none capable of successfully holding the
position among locals and MNCs were obliged to hire foreigners at very high wages.
Recently things have started changing, given to the fact that more and more Chinese
managers are able to speak English and are educated abroad. (LO: 3, Discuss the tasks
associated with identifying and selecting competent employees, AACSB: Analytical
thinking)
13-16. What advice would you give companies such as Maersk on their human resource
management policies?
Given to the young generations of Chinese managers, a lot of them educated abroad
and English speakers, new opportunities are now opening up to MNCs, both in term of
lower costs but also for of a better match with market requirements. (LO: 3, Explain the
different types of orientation and training, AACSB: Analytical thinking)
ANSWERS TO CASE APPLICATION 2
QUESTIONS
Student answers to these questions will vary.
Measuring Output, Not Hours Worked
13-17. Why do you think an organization like BAE would want to adopt schedule-based
work (SBW) pattern?
Many students may challenge the fact that the company should have explored other
means of responding to the business challenges faced, but this is to be viewed as the
HR contribution. The company was faced with affordability issues from different
perspectives. A key concern was that payment for overtime seemed not to actually
represent extra work if work was reviewed from the perspective of smarter ways of
working. In other words, it was not evident that extra work was required and so the extra
pay for overtime was not also required. Furthermore, it was agreedagreed part of the
agreement was to revolutionise revolutionize the working culture and productivity of the
business so that payment for work was aimed at agreed targets as opposed to the set
traditional 5 days working week. (LO: 2, Describe the external influences that affect the
human resources management process, AACSB: Analytical thinking).
13-18. What possible difficulties can you identify as a result of the proposed changes?
Some students may view the position of the trade unions as suspect and that this may
be a subject of collective bargaining in future whilst while some other students may only
view the issue of possible compromise of quality as the central matter ofprimary
concern. The latter position could also give credence to the fact that employees could
compromise quality for completing work so they could take Friday off. Additionally, some
students may also express the concern that targets may not be achieved as employees
may not be too keen on putting extra work. Another possible difficulty is the continued
and sustained support of the trade union. For as long as BAE Systems did not ask for a
pay review to match the days worked as a result of the new arrangement, which attracts
a possible 4 day working week, instead of 5 days. (LO: 2, Describe the external
influences that affect the human resources management process, AACSB: Analytical
thinking).
13-19. Analyze the role of HR in embedding the new vision into the culture of the
organization.
The HR division was careful in identifying the key stakeholders in the project, particularly
the trade unions. The HR team also moved away from the traditional HR roles which
seemed reactionary than proactive. Besides, the HR team responded to the importance
of contributing to the bottom line which was easily measurable through smart working
which was meant to reduce the wage bill and yet established a working pattern that kept
employees happy and more committed to the organisationorganization. It ended up
creating a win-win situation for BAE Systems. It could also be addedStudents should
also note that the HR teams succeeded in establishing a high commitment culture in the
organiszation – —a set of HR practices that has have the potential to contribute towards
organisational organizational performance. (LO: 2, Describe the external influences that
affect the human resources management process, AACSB: Analytical thinking).