Managing Human Resources
Chapter 9
Chapter 9 Learning Goals
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What is the human resource management
process?
How are human resource needs determined?
How do human resource managers find good
people to fill the jobs?
What is the employee selection process?
What types of training and development do
organizations offer their employees?
Chapter 9 Learning Goals (cont’d.)
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What is a performance appraisal?
How are employees compensated?
What is organizational career management?
What are the key laws and federal agencies
affecting human resource management?
What trends are affecting human resource
management?
Learning Goal 1
• What is the human resource management
process?
– Job analysis and HR planning
– Employee recruitment and selection
– Employee training, performance appraisal, and
compensation
– Ends when employee leaves organization
Human Resource Management
The process of hiring, developing,
motivating, and evaluating
employees to achieve
organizational goals
Human Resource Management
Strategies &
Process
objectives of the
organization
Job analysis
& design
HR planning &
forecasting
Training &
development
Employee
recruitment
Performance planning
& evaluation
Organizational career
management
Employee
selection
Compensation
& benefits
Learning Goal 2
• How are human resource needs determined?
– Job analysis
• Studying a job to determine its tasks and duties for
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Setting pay
Determining employee job performance
Specifying hiring requirements
Designing training programs
– Job description
• Lists the tasks and responsibilities of the job
– Job specification
• Describes skills, knowledge, and abilities needed to fill the job
described in the job description
Job analysis
& design
HR planning &
forecasting
Employee
recruitment
Employee
selection
Job Analysis:
A study of the tasks required to do a
particular job well
• job description
• job specification
Job analysis
& design
HR planning &
forecasting
Employee
recruitment
Employee
selection
Demand forecast:
Determining the number of employees
needed by some future time
Supply forecast (internal):
Estimating the number of current
employees who will be available to fill
various jobs at some future time
Labor Supply & Demand
Labor shortage in the 1990s has turned
the tables for employers
• some individuals seeking work advertise
themselves as free agents
• employers bid for interviews with free
agents
• US Department of Labor estimates there
are 10 million free agents
Source: Entrepreneur, Jan. 2000, p. 16.
Learning Goal 3
• How do human resource managers find good people
to fill the jobs?
– Most firms begin by trying to fill the job from within
– If internal candidates are not available, an external search
begins
• Local media is used to find workers who are
– Nontechnical
– Unskilled
– Nonsupervisory
• Highly trained recruits are found by using
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College recruiters
Executive search firms
Job fairs
Company Web sites
Job analysis
& design
HR planning &
forecasting
Employee
recruitment
Employee
selection
Recruitment:
Attempt to find and attract qualified
applicants in the external labor market
• job fair
Learning Goal 4
• What is the employee selection process?
– Applicant submits an application or résumé
– Receives a short, structured interview
– Applicant may be asked to take an aptitude, personality, or
skills test
– Selection interview
• In-depth discussion of applicant’s
– Work experience, skills, and abilities
– Education and career interests
• Applicants seeking professional or managerial positions may be
interviewed by several people
– Successful applicants may be asked to undergo a physical
exam
Job analysis
& design
HR planning &
forecasting
Employee
recruitment
Employee
selection
Selection:
The process of determining which
people in the applicant pool possess the
qualifications necessary to be
successful on the job
Steps of the Selection Process
Decision to hire
Physical examination
Background and reference checks
Selection interview
Employment testing
Initial screening
Learning Goal 5
• What types of training and development do
organizations offer their employees?
– Training and development programs are designed
to increase employees’ knowledge, skills, and
abilities to foster job improvement
• Formal training
• Development programs
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Job rotation
Executive education programs
Mentoring
Special project assignments
Training &
development
Performance planning
& evaluation
Compensation
& benefits
Training and Development:
Activities that provide learning
situations in which an employee
acquires additional knowledge or skills
to increase job performance
•on-the-job training
•off-the-job training
Training and Development
Forecasting International predicts that the need for
life-long learning will characterize business in
the future
Implications:
– need for higher training budgets
– need for constant retraining due to turnover
– use of technology for just-in-time training
– training as a motivational & retention tool
Source: HR News, Dec. 1999, pp. 18-20.
Learning Goal 6
• What is a performance appraisal
– Compares an employee’s actual performance
with the expected performance
– Typically used to determine an employee’s
• Compensation
• Training needs
• Advancement opportunities
Training &
development
Performance planning
& evaluation
Compensation
& benefits
Performance planning & evaluation process:
Performance planning:
Setting standards &
expectations
Employee job
task behavior
Performance
evaluation
Rewards &
job changes
Performance Evaluation
360° Evaluation: performance feedback that
combines self-appraisal with ratings made
by coworkers at the same level, above, and
below the target person in the managerial
hierarchy
Advantages:
provides a well-rounded view
avoids individual bias
can have more impact than a single source
can establish consensus
Learning Goal 7
• How are employees compensated?
– Direct pay
• Hourly wage or monthly salary paid to an employee
• May include bonuses and profit shares
– Indirect pay
• Various benefits and services
– Required by law: unemployment and worker’s compensation,
Social Security
– Optional: paid vacations and holidays, pensions, health and other
insurance products, employee wellness programs, college tuition
reimbursement
Training &
development
Performance planning
& evaluation
Compensation
& benefits
Types of Compensation or Pay:
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hourly wages
salaries
piecework and commission
accelerated commission schedule
bonus
profit sharing
fringe benefits
Learning Goal 8
• What is organizational career management?
– Facilitation of employee job changes including
• Promotions
– Upward move with more authority, responsibility and pay
• Transfers
– Horizontal move in the organization
• Layoffs
– Temporary separation arranged by the employer, usually when
business is slow
• Retirements
– Permanent separation that ends one’s career
Organizational career
management
Types of Career Change:
1. Job change within the organization
– transfer
– promotion
– demotion
2. Separation from the organization
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layoff
termination
resignation
retirement
Learning Goal 9
• What are the key laws and federal agencies affecting
human resource management?
– Federal law prohibits age, race, gender, color, national origin,
religion or disability discrimination
– Americans with Disabilities Act bans discrimination against
disabled workers
– Family and Medical Leave Act requires employers to provide
employees up to 12 weeks of unpaid leave a year
– Other Federal agencies dealing with HR administration:
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Equal Employment Opportunity Commission (EEOC)
Occupational Safety and Health Administration (OSHA)
Office of Federal Contract Compliance Programs (OFCCP)
Wage and Hour Division of the Department of Labor
Laws Affecting Human Resources
1. Fair Labor Standards Act (1938)
2. Equal Pay Act (1963)
3. Occupational Health & Safety Act
(1970)
4. Americans with Disabilities Act
(1990)
Learning Goal 10
• What trends are affecting human resource
management?
– Women comprise 45% of the American workforce
• Growing numbers of dual-career couples
• Companies are facing issues like sexual harassment and
nonwork issues such as child and elder care
– Workers change jobs 3 to 5 times during their career
• Lessens loyalty between employer and employee
– American workforce is becoming more diverse
• Companies are offering diversity training and mentoring of
minorities
Trends in Human Resources
1. Social change
 More women in the work force
 More people changing jobs
2. Demographics
 More diverse work force
3. Advancing Technology
 enables more outsourcing
 enables more telecommuting
4. Global Competition
– adaptable employees, need for language training &
cultural orientation
People Changing Jobs
Amount of Time MBAs
Expect to Stay in Their First Job
1 to 2 years
5 or more
years
2 to 3 years
4 to 5 years
3 to 4 years
Source: Fortune, Mar. 16, 1998.