Chapter 5
Information for Human Resource
Decisions
Chapter 5 Objectives
1. Describe human resource planning as a source of
information for decision making.
2. Discuss strategy as a source of information for
making human resource decisions.
3. Discuss economic conditions as a source of
information for making human resource decisions.
4. Describe job analysis as a source of information for
making human resource decisions.
5. Discuss the job analysis process and Identify and
summarize common job analysis methods.
What is Human Resource Planning?
The process of
forecasting the supply
and demand for human
resources within an
organization and
developing action plans
for aligning the two.
What are the benefits of HR Planning?
Human Resource Planning
• Through HR planning, an
organization is able to generate a
list of future human resource needs
and a plan for meeting them.
• To derive HR needs, the
organization must forecast its
demand and supply.
Human Resource Planning (Cont.)
• Demand forecasting involves predicting the number and
types of people the organization will need at some future
point in time.
• Supply forecasting involves estimating which organizational
positions are expected to be already filled.
Demand
Supply
Forecast
Forecast
HR
Needs
Human Resource Planning (Cont.)
Demand Forecasting
An organization predicts needed workforce size on the
basis of certain business factors.
A business factor is an attribute of the business such as sales
volume or market share, which closely relates to the size of the
needed workforce.
Is used when an organization operates in a stable
environment.
Human Resource Planning (Cont.)
Supply Forecasting
• Steps to supply forecasting
– Step 1: Organization groups its positions by
title, function, and level of responsibility.
– Step 2: Estimate within each job group, how
many of its current employees will:
• Remain in their positions during the planning
period.
• How many will move to another position.
• How many will leave the organization.
Human Resource Planning (Cont.)
Estimating Future HR Needs
A firm derives its specific staffing needs by combining the results of the supply
and demand forecasts within each job group
Demand
Supply
Forecast
Forecast
HR
Needs
Outcomes of the HR Planning Process
Dealing with an Undersupply/Oversupply of Employees
Human Resource Information Systems (HRIS)
• A computerized information
package that provides
management with increasing
capacity to record, store,
manipulate, and communicate
information across wide
geographic boundaries, with
access to many users
Human Resource Information Systems (HRIS)
(Cont.)
A Company’s HRIS contains information about:
A company’s jobs
• Number and types of
jobs
• Number of people
needed in each job
• Qualifications needed to
perform each job
A company’s employees
• Individual’s equal
employment opportunity
classification
• Date of hire
• Salary history
• Performance ratings
Human Resource Information Systems (HRIS)
(Cont.)
Purposes served by a company’s HRIS:
Handles most of the record keeping done by HR professionals.
Reduces paperwork and cuts administrative costs.
Organizational members outside the HRM department can more easily
access the information.
Store information essential for filling vacant positions.
Labor Force Trends and Issues
 Increasing workforce diversity
 Gradual increase in average age of the
U. S. workforce
 Entry of more women into the workforce
 Changing ethnicities
 Global economic conditions
Strategy as a Source of
Information
Stability
Growth
Reduction
Implications
of Strategy
Strategy as a Source of
Information (Cont.)
• Implications of a growth strategy:
 Need to hire new employees
• Implications of a stability strategy:
 Implement training to upgrade employee skills
 Implement programs to help reduce turnover
• Implications of a reduction strategy:
 Find ways to reduce workforce
Normal attrition processes
Retirement (including early retirement)
Layoffs
Economic Conditions as
a Source of Information
• Rate of Unemployment
 Is calculated by the Bureau of Labor Statistics as
the percentage of individuals looking for and
available for work who are not presently
employed.
• Market Wage Rate
 Is the prevailing wage rate
for a given job in a given
labor market.
Economic Conditions as
a Source of Information
• Human Capital Investments
Are investments people makes in themselves
to increase their value in the workplace.
Can take the form of
additional education
or training.
Job Analysis as a Source of Information
Job analysis information can be applied to a variety of HRM practices
Recruitment
and selection
Training and
development
programs
Productivity
improvement
programs
Performance
appraisal
forms
Employee
discipline
decisions
Compensation
decisions
Safety and
health
programs
Job Analysis as a Source of Information
• Job Analysis
Is the process of gathering and organizing
detailed information about various jobs within
the organization so that managers can better
understand the process through which they
are performed most effectively.
Job Analysis
Determining the Type of Information to be Collected
When conducting a job analysis, the
organization must determine:
The type of
information
to be
collected.
How it will
be
collected?
Who will
collect the
information?
How it will be
recorded or
documented?
Job Analysis
Determining the Type of Information to be Collected
Job analysis
information may be
divided into three
categories:
Job Context
plant
assembly
line
Worker
Requirements
knowledge,
skills,
abilities
•Job Content
•Job Context
•Worker Requirements
The purpose of job analysis dictates the particular
information to be gathered
Job Content
assemble
boxes
Job Analysis
Determining the Type of Information to be Collected
Job Content
• What the worker does?
• Purpose of the action.
• Tools, equipment, or machinery
used in the process.
• Relative importance of tasks.
• Expected performance levels.
• Training needed
Job Analysis
Determining the Type of Information to be Collected
Job Context
•
•
•
•
•
•
•
•
Reporting relationships
Supervision received
Judgment
Authority
Personal contacts
Working conditions
Physical demands
Personal demands
Job Analysis
Determining the Type of Information to be Collected
Worker Requirements
•
•
•
•
•
Knowledge
Skill
Ability
Personal characteristics
Credentials
Job Analysis
Determining How to Collect the Information
HR professionals gather job
analysis information by:
• Interviewing the workers.
• Observing them at work.
• Having them complete
job analysis
questionnaires
Appropriateness of each approach
depends, in part, on the type of
information sought.
Job Analysis
Determining How to Collect the Information
Job analysis interviews:
• Structured conversations between the job analyst and
one or more subject-matter experts.
Job Analysis
Office Space and Job Analysis
Questions:
1.
2.
3.
4.
5.
What is “right” about how “The
Bobs” conducted the interview?
What is “wrong” about how “The
Bobs” conducted the interview?
How would you approach this
situation differently in order to
make this analysis more effective?
Do you think Peter is the “typical
worker”?
When Peter states that it is “a
problem of motivation” how would
you realistically address this
situation?
Job Analysis
Determining How to Collect the Information
Job analysis observation:
• Involves watching the incumbent
perform the job.
Job Analysis
Determining How to Collect the Information
Job Analysis Questionnaires
Job Analysis
Determining How Job Analysis Information Will Be Recorded
General Purpose Job Description
Job
Identification
Job Summary
Essential
Functions
Job
Specifications
Job Analysis
Legal Issues
• Americans with
Disabilities Act (ADA)
• Gender
discrimination
• Federal guidelines on
proving jobrelatedness of
employment-based
decisions