Managing Human Resources, Tenth
Canadian Edition
Monica Belcourt, Parbudyal Singh, Scott A.
Snell, Shad S. Morris, Stephen D. Risavy
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© 2023, 2020 Cengage Learning Canada, Inc. ALL RIGHTS RESERVED.
Adapted from Managing Human Resources, Eighteenth Edition, by Scott A.
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Library and Archives Canada Cataloguing in Publication
Title: Managing human resources / Monica Belcourt, FCHRL, York University,
Parbudyal Singh, York University, Scott A. Snell, University of Virginia,
Shad S. Morris, Brigham Young University.
Names: Belcourt, Monica, author. | Singh, Parbudyal, author. | Snell, Scott,
author. | Morris, Shad, author.
Description: Tenth Canadian edition. | Includes bibliographical references
and index.
Identiȴers: Canadiana (print) 2022013717X | Canadiana (ebook) 20220137242
| ISBN 9780176945459 (softcover) | ISBN 9780176945473 (PDF)
Subjects: LCSH: Personnel management—Textbooks. | LCSH: Personnel
management—Canada—Textbooks. LCGFT: Textbooks.
Classiȴcation: LCC HF5549 .B333 2022 | DDC 658.3—dc23
ISBN-13: 978-0-17-694545-9
Ebook ISBN 13: 978-0-17-694547-3
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Print Year: 2022
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Case Study 1
Domino’s Tries to Get Its Strategic Recipe Right
Hand Robot/ Shutterstock.com
Believe it or not, years
ago it was normal for
p eop le to have to
wait an hour or more
to get their p izzas
delivered. But those
were the years B.D.—
Before
Domino’s.
Started by Tom Monahan and his brother in Ypsilanti,
Michigan in the 1960s, Domino’s created a value p rop osition p eop le were hungering for p izza delivered in 30
minutes or less. Better yet, if a Domino’s p izza wasn’t
delivered in 30 minutes, it was free. That was unheard
of in the p izza business.
Monahan changed the pizza industry, not because
Domino’s created a better product but because it was able
to offer a different value proposition than anyone else
was offering, as well as align its people, processes, and
systems to deliver against that promise. Domino’s used
assembly line-based systems and standardized processes
to improve ef ciency and reduce pizza preparation times.
For example, it was the rst to use conveyor-belt oven
technology to ensure uniform temperatures and reduce
baking times. Domino’s also translated its strategy into
HR deliverables by emphasizing and encouraging fast
pizza making and delivery. Annually, the company holds
a “World’s Fastest Pizza Maker” competition in which its
pizza makers compete for cash and other prizes.
As important as what Domino’s did is what it did
not do. Strategy is about making choices. Domino’s
did not focus on great pizza—it focused on fast pizza.
It did not customize every order but prepared them
all in advance. It didn’t hire premiere pizza chefs who
tossed pizza dough into the air to make lighter crusts.
It didn’t use the wood- red stoves to give the pizza an
old-world taste. And it didn’t offer in-store dining.
Each of the ingredients in Monahan’s formula was
aligned around its value proposition of fast delivery—
a strategy that worked well for Domino’s for decades.
This strategy, and a franchise model, helped the company grow by leaps and bounds. Today, there are over
10,000 Domino’s pizza stores located in more than 70
countries around the world.
Over time, however, Domino’s competitive environment changed. Other companies began delivering pizzas
in about 30 minutes, and consumers began wanting more
than fast pizza: they wanted good pizza. The problem
was that Domino’s wasn’t delivering on that score In
Discussion Questions
To turn things around, the company had to rethink its
value proposition. That included revamping not only its
food but also its HR strategies and policies. One problem
Domino’s suffered from is rampant in the fast-food
industry: employee turnover. Domino’s turnover rate was
158 percent annually. In other words, for every employee
hired during a year, another 1.5 employees quit.
Domino’s CEO at the time, David Brandon, wasn’t
convinced that higher pay for hourly-wage employees
was the solution, however. “If we could have increased
everybody’s pay 20 percent could we have moved the
needle a little bit to buy some loyalty? Maybe, but that’s
not a long-term solution.” Moreover, because most
Domino’s stores are individually owned rather than
corporate owned, the individual owners have to decide
for themselves whether to increase hourly wages.
Instead, Brandon focused on the quality of store
managers—choosing better ones, nding ways to retain
good ones, and coaching them to train and motivate
employees by being respectful and polite. The company also began offering managers stock options for
growing their store revenues.
Store managers cause employees to stick around—or
not, said Rob Cecere, a regional manager for Domino’s.
Employees can go to McDonald’s or Pizza Hut and make
as much as they make at Domino’s. “You’ve got to make
sure they are happy to come to work for you,” Cecere
explained. Domino’s also worked harder to promote a
culture of “fun” via its World’s Fastest Pizza competition
and other initiatives. Brandon thought employees were
so crucial that he renamed the company’s HR department the “People First” department.
HR wasn’t the only part of the recipe Domino’s had
to change, however. It also had to create a new value
proposition for its food. In 2009, it embarked on an
effort and associated marketing campaign it dubbed
the “pizza turnaround” to do precisely that. As part of
the effort, the company developed a new recipe for
its pizza crusts; began using fresher, gourmet types of
ingredients; and began offering new products, such as
artisan pizzas, pasta, and desserts. It also remodelled
stores and added in-store dining.
Domino’s chief strength still lies in its systems
and technology. The biggest department at the rm’s
headquarters in Ann Arbor, Michigan, is its technology
department. The department has built novel applications over the years, such as an online ordering application that allows customers to “build” their pizzas online
and track their preparation, cooking, and delivery times.
1. As you have learned, substitutes can be an
opportunity or a threat. The smartphone is a great
example of a new product that eliminated the
need for many other products. In groups, develop
a list of the products that the smartphone has
replaced.
2. How has COVID-19 affected the future of
postsecondary education in Canada? List several
impacts and discuss the implications for the
demand for faculty.
3. Think about an organization that you know well.
Place the employees of this organization into the
following categories: strategic knowledge workers,
core employees, supporting workers and partners,
and complementary skills workers.
4. Shopify and Tim Hortons are both Canadian
success stories. From websites and news articles, try
to articulate and compare their corporate strategies.
Try to do a SWOT analysis for one of them.
5. During the semester in which you are enrolled
in this course, there will be news about an
organization needing to reduce the workforce by
thousands of employees. What are the options?
What are the advantages and disadvantages of
each option?
6. Imagine that you are president of the HR student
association at your school. You want to measure
the success of the association during your term.
What metrics would you use? What benchmarks
would you use?
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Why is HR planning integral to strategic planning? What role does a rm’s mission, vision, and
values play in strategy formation? What are the linkages between High Performance Work Systems
and rm performance?
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Summary
Outcome 1 SHRM integrates strategic planning and
HRP. It can be thought of as the pattern of HR deployments and activities that enable an organization to
achieve its strategic goals. The rm’s mission, vision,
and values provide a perspective on where the company is headed and what the organization can become
in the future. Ideally, they clarify the long-term direction of the company and its strategic intent. An HPWS
helps to drive rm performance.
HRM Experience
Outcome 2 Analyzing the rm’s external environment
is central to strategic planning. Environmental scanning is the systematic monitoring of major external
forces in uencing the organization, including forces
in the business environment and the competitive environment. Changes in the external environment have
a direct impact on the way organizations are run and
how people are managed. Some of these changes represent opportunities, and some of them represent real
threats to the organization.
Custo m izing H R fo r Diffe re nt Typ e s o f H um an Cap ital
Part of strategic planning in HRis mapping an organization’s
human capital. When we look at the strategic value of a person’s
skills and their uniqueness, we soon discover that organizations
comprise different kinds of workers who have very different kinds
of skills. Some are core knowledge workers, some are more traditional job-based employees, some are contract workers, and some
are external partners. In this context, it is unlikely that we would
manage all of these employees in the same way (as much as we
might want to for fairness). There are differences in HRpractices for
different groups. This is not bad, but it makes the job of HRmanagers more dif cult.
Assignment
The following are descriptions of three different employees. How
would you characterize each worker? What role does each play
when it comes to the organization’s strategy?
Sobadia Bascomb is a highly talented computer programmer for Applied Software Solutions. She is among an elite set of
engineers in the computer industry doing leading-edge work on
advanced computer modelling. The rm’s CEO, Bill Ding, believes
the future of the company rests on the innovative work that Sobadi
dh t
di H
i th t
i ht l
her away to work for them, so he wants to give her all the room
she needs to grow and stay committed to the rm.
Calvin Duff is a salesperson on the retail side of the rm.
He has daily contact with customers and is responsible for making sales and communicating with service personnel. Make no
mistake: to many customers, Calvin and his coworkers are the
“face” of the company. Always on the lookout for a better position, Calvin has thought about working for PeachTree Computing,
Applied Software Solution’s main competitor. Other salespeople
have found that they can leave Applied Software Solutions and
get “up to speed” easily at other rms. Their skills are very
transferable, and the transition is not dif cult. Bill Ding and other
managers at the company recognize this fact, so they try to keep
salespeople loyal and productive, recognizing that many of them
do eventually leave.
Chandra Singh is a part-time administrative assistant for
Applied Software Solutions. She handles routine typing and ling
work for the company, particularly in peak periods in the summer
and around the holidays. She usually works for a few weeks at a
time and then takes time off. The executives at the company have
considered either outsourcing her job to an agency or automating
it th
h
t
t
Bt f
thi
t d
Outcome 3 Conducting an internal analysis to gauge
the rm’s strengths and weaknesses involves looking
at a rm’s core capabilities, its talent and composition in the rm, and its corporate culture. An internal
analysis enables strategic decision makers to assess the
organization’s workforce—its skills, cultural beliefs,
and values.HRP is a systematic process that involves
forecasting the demand for labour, performing supply
analysis, and balancing supply and demand considerations. Quantitative or qualitative methods help a rm
identify the number and type of people needed to meet
the organization’s goals.
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Outcome 4 After managers have analyzed the internal
strengths and weaknesses of the rm, as well as
external opportunities and threats, they have the information they need to formulate corporate, business, and
HR strategies for the organization. A rm’s corporate
strategy includes the markets in which it will compete,
against whom, and how. The rm’s business strategy
is viewed in terms of domain navigation. It is more
focused on how the company will compete against
rival rms in order to create value for customers. A
rm’s HR strategies and practices should be aligned
with its corporate and business strategies.
Outcome 5 Strategic p lanning decisions affect—and are
affected by—HR functions. Through HR and strategic
p lanning, HR managers can proactively identify and
initiate p rograms needed to develop organizational
cap abilities on which future strategies can be built.
HRP and strategic p lanning tend to be most effective
when there is a reciprocal relationship between the
two p rocesses.
Outcome 6 Formulating an HR strategy is only half of
the HR battle. The strategy must also be implemented.
Employment forecasts must be reconciled against the
internal and the external supplies of labour the rm
faces. This can include having current employees
work overtime; hiring full-time, part-time, or contract
employees; downsizing employees; furloughing them;
and outsourcing or offshoring. If there is a labour
shortage, the rm might have to reformulate its longterm and short-term strategic plans or nd ways to
develop employees “from the ground up.”
Sum m ary
abriefdscptonhl,gA r
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F e a t u re s
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Brief Con ten ts
Preface xxvii
About the Authors xxxvii
A Note Regarding Inclusion, Equity, and Diversity xl
Part1
HumanRcesMaour nagementiPrspcv
1
The World of Human Resources Management
2
Strategy and Human Resources Planning
1
46
Online Appendix: Calculating Turnover and Absenteeism
(available at login.cengage.com)
Part2
Part3
MeetingHumanRcesour mqi ents
3
Equity, Diversity, and Inclusion: The Legal Environment
4
Job Analysis and Work Design
5
Expanding the Talent Pool: Recruitment and Careers
93
134
DevfloctpingEsHumanRcesour
174
Online Appendix: Personal Career Development
(available at login.cengage.com)
Part4
6
Employee Selection
217
7
Training and Development
256
8
Performance Management
298
9
Managing Compensation
342
ImplementigCompensatiodScury
10 Pay for Performance: Incentive Rewards
11 Employee Benefits
409
12 Promoting Safety and Health
Part5
441
Enhacigmploye–MangementRlaios
13 Employee Rights and Discipline
477
14 The Dynamics of Labour Relations
Part6
380
511
ExpandigHumanRcesMaour nagementHorizons
15 International Human Resources Management
545
Name Index 593
Organization Index 595
Subject Index 598
vi
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Con ten ts
Pre fac e
xxvii
Ab o ut the Autho rs
xxxvii
A N o te Re g ard ing Inc lusio n, Eq uity, and Dive rsity
xl
Part1
HumanRcesMaour nagementiPrspcv
Chapter1
TheWorld ofHumanRcesMaour nagement1
WhyStudHumanRcesMaour nagement?2
HumanCapitlndHRM3
CompetivIsuandHumanRcesMaour nagement5
Isue1:RpondigStraeclyCris,Changes,dDiruptonsheLcal
GlobalMaand rketplac5
RealityCheck:Sixgma9
GoytilbanSds1uCgRvAeihcotaprn:2usI
Isue3:AdvancigHRMwichnolgy12 thTe
HighltsnHRM1e.:ofTWohFutr rk14
HighltsnHRM1.2:FactorsConsiderWhenEvalutigHuman
RcesInformu ationSysem18
Isue4:ContaigCostWhlentadMapTa ileRtangTo ximizngPoductvyr19
Isue5:RpondigthDemographicndDvestyChalengsoftWoce23rkfo
Isue6:AdaptingoEclCulturaShifsAecngWoce28rkfo
TheBusinCase:AdvntgDisadvntgeofPr-TmeWorkes 30
EthicsnHRM:SkywalkersndGroundworkes32
HighltsnHRM1.3:Work–LifeHarmony3
ThePartnsipofLManagersdHumanRcesDour patments3
Responiblt oftheHRManager3
CompetncisofhHRManager34
SmalBusineAplcato35
Sum m ary
36
Ke y Te rm s
36
Disc ussio n Que stio ns
37
H RM Exp e rie nc e : B alanc ing Co m p e titive Challe ng e s and Em p lo ye e Co nc e rns
Case Stud y 1: N e w H R Strate g y M ake s Llo yd ’s a “ B e st Co m p any”
Case Stud y 2 : Inte rg e ne ratio nal Issue s
39
Case Stud y 3 : She ll’s To p Re c ruite r Take s H is Cue s fro m M arke ting
N o te s And Re fe re nc e s
Chapter2
37
38
40
41
StraegyndHumanRcesPourlanig46
StraegicPlndHumanRces47our
High-PerfomanceWorkSystems48
StraegicPlndHRP:Linkgtheocs4r9
ix
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Step1:Mialues50ion,Vd
DevlopingaMisionStaement51
HighltsnHRM2.1:AirCand:Mision, alues51Vion,d
HsRoleinE’tabhgd cFrmf sMi’ alues52ion,Vd
Step2:ExrnalAysi53
TheBusonmiEvr ent53
RealityCndshrGleck:SpotingTbalEmy54
ComonpemtivEr ent5
HsExterRnalSupyofLb’57
Step3:InralAysi58
Ceor apbiltes58
SustaingCompetivAoudghanPrl59
HighltsnHRM2.:TheMeemasur entofHumanCapitl60
CorpateC62ultr
EthicsnHRM:TheEmploymentContrac62
TheBusinCase:HiringContracWorkesPay63
ecasting6Fo5r
HighltsnHRM2.3:HRPandStregyQuestionAkBusine
Managers67
HighltsnHRM2.4:LackofSuesinPltgFThmr ily
Busine 70
AseingaFrmsHu’manCapitlRedns:GapAnalysi 71
Step4:FormulatingSrey72
CorpateSgy73
BusineStragy74
FunctioalSregy:EsAment7
Step5:ragyImplementaio78
kingActo:RenTa ilgSupyadDemand79
HighltsnHRM2.5:COVID-19andtheLbourSpls80
Step6:EvaluiondAsment81
EvalutiondAsementIsu81
MeasuringFmsStraegicAlnm’ ent82
EnsurigStaecFlxbyfo8h5
SmalBusineAplcato:CerMaa nagement85
Sum m ary
86
Ke y Te rm s
86
Disc ussio n Que stio ns
87
H RM Exp e rie nc e : Custo m izing H R fo r Diffe re nt Typ e s o f H um an Cap ital
Case Stud y 1: Do m ino ’s Trie s to Ge t Its Strate g ic Re c ip e Rig ht
Case Stud y 2 : H o w a Strate g y Chang e Le d to N ike ’s Fo rm atio n
N o te s and Re fe re nc e s
x
87
88
89
90
Co n t e n t s
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OnlineApdx:
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CurnoveadAlcbstigTm
EmurnoveRplyTatsA2-1
ComurnoveRptighTaA2-1
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EmployeAbsntimRatesA2ComputingAbsemRatesA2HighltsnHRMA2.1:CostAciaedwiurnovefOnthT eComputer
PogrammerA2-3
CostfAbenimA2-4
AbsentimandHRPA2-4
Part2
MeetingHumanRcesour mqi ents
Chapter3
,DiEquityandIclso:TheLgmvr ent93
TheLgalFrmework94
TheCanadian Charter of Rights and Freedoms94
EthicsnHRM:Ethicsqualyor95
TheCanadian Human Rights Act (CHRA)96
cemThEnfor entofPvicalHr umanRightsLws10
PayEquit10
EmploymentEquiy10
StausofDeigntdGroups102
HighltsnHRM3.1:RetnioSrags103
HighltsnHRM3.2:Acesiblty104
HighltsnHRM3.:WhsinaNt’ me?105
BenfitsoEmploymentEquiy106
TheEmployment Equity Act (195)06
HighltsnHRM3.4:Remquir entsforhFdalContracsPgm107
AdminstraocemdEf ent oftheEmployment Equity Act 108
TheImplementaiofEmploymentEquiyOrganiztos108
HighltsnHRM3.5:SugestionfrIcl10
HighltsnHRM3.6:TheDutyoAcmmodate13
SexualHarsment14
HighltsnHRM3.7:TheCostofSexualHarasment15
ManagiDverstyndIcluio16
HighltsnHRM3.8:BasicComponetfcsivaSExulHarasment
,andExtesioPhClcy oneptfHarasment17
TheBusinCase:ThEconmaluesofDiicV versty19
InclusioaryPte:CraonimgEvr entforSucs120
Co n t e n t s
45459_fm_hr_i-xl.indd 11
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07/02/22 4:02 PM
RealityCheck:DiversityandIcluoAhmentsaRBC12
SmalBusineAplcato124
Sum m ary
12 5
Ke y Te rm s
12 5
Disc ussio n Que stio ns
12 5
H RM Exp e rie nc e : Yo ur Op inio ns ab o ut Em p lo ym e nt Eq uity
Case Stud y 1: Stud y Fig hting Fire s
Case Stud y 2 : Outre ac h Effo rts
12 7
12 7
Case Stud y 3 : W o m e n o n the Rig ht Trac k at CP Rail
N o te s and Re fe re nc e s
Chapter4
12 6
12 9
12 9
JobAnalysidWork Design134
RelationshpfJb mqur entsadHRMFunctios135
StraegicHRP135
Recruitment136
Selction136
raingdDTevlopment136
PerfomanceAprisl137
CompensatioManagement137
LegalCompliance137
JobAnalysi138
TheBusinCase:ThBnfitoJbAalysdDesign138
GatheringJobIfmation140
ColingtheArcuayfJbImation14
RealityCheck:JobAnalysitEDSCandIc.14
EthicsnHRM:JobInflati142
AoachestpJrbnlyi142
JobDescriptn145
HighltsnHRM4.1:JobDelentAcquis rpofaTa tn146
Poblemr swithJobDescripn148
JobDesign149
MotivaonlConsiderato150
IndustrialEgeConsiderat15
HighltsnHRM4.2:EmpowedEmr ployesAchivResult152
gonmEr icConsiderat153
JobCraftingdJobCarving153
DesignWorkfoGramoupsandTe s154
EmployeInvmentGroups15
EmamployeTe s156
FlexibWorkScheduls159
Flextime160
xi
Co n t e n t s
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HighltsnHRM4.3:FlextimeandWoomrkingf HomeamidstCOVID-1963
SmalBusineAplcato164
Sum m ary
16 4
Ke y Te rm s
16 5
Disc ussio n Que stio ns
16 5
H RM Exp e rie nc e : Estab lishing Gro und Rule s fo r Te am Suc c e ss
Case Stud y 1: Yaho o Cuts the Co rd o n Te le c o m m uting
Case Stud y 2 : B ut, M y Jo b H as Chang e d !
Case Stud y 3 : The Zap p o s Exp e rim e nt
N o te s and Re fe re nc e s
16 6
16 6
16 7
16 8
170
Part3
DevflopctingEsHumanRcesour
Chapter5
lentPo:RExpadigheTa crutmentadCrs174a
StraegicAspofRecruitng176
WhoShuldDoteRcruing?176
ShouldaFirmRecruitInalyoEx?17
LabourMarkets178
Brandig179
HighltsnHRM5.1:MasRriot’ecumentPricpls:LvgUptohe
EmploymentBrad18
RecruitmentChanels182
RecruitngIaly182
RecruitngExaly183
HighltsnHRM5.2:EmployeRfraPogmsThatWork187
HighltsnHRM5.3:MaourInteshipPgamkY aSuces190
ImfecovtinghsEprRu19
UsingRealtcJobPvwr s19
Surveys192
RecruitngMetrics192
Retnio:HowDoWeKepOulnt?194 rTa
getdRr cuimTa ent195
CerMaa nagemlentov:DrTimpngTa e197
TheGoal:MatchingIdvualOrganiztolNeeds197
RIdentifygCamqur Opportuniesad198
CerDa vlopmentIiavs203
EthicsnHRM:UnraingoExplt?204dIesh:T
SmalBusineAplcato:SmalCompaniesOftenOfferBigRewds208ar
Sum m ary
209
Ke y Te rm s
209
Disc ussio n Que stio ns
209
Co n t e n t s
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H RM Exp e rie nc e : Care e r M anag e m e nt
Case Stud y 1: Im p rim ax
2 10
2 10
Case Stud y 2 : Re c ruitm e nt Channe ls
2 11
Case Stud y 3 : Ge t Paid fo r an Em p lo ye e Re fe rral
N o te s and Re fe re nc e s
OnlineApdx:
(avilbetogn.cm)A5-1
2 12
2 13
PersonalCaDer velopment
DevlopingPrsaSkdCompetncis
A5 - 1
ChosingaCera
A5 - 1
UseofAvailbRcur5-1
HighltsnHRM5.A1:“MustHave”CrCoa mpetncisA5-2
Self-Evaution
A5 - 2
estInvoriA5-3
InformationlIervws,JobShadwing,adItershpA5-3
ermEvalutingLo-T EmploymentOpportuniesA5-4
ChosingaEmployer
A5 - 4
BecomenurpigaEt
A5 - 5
KepingaCrPaespctiv
A5 - 5
HighltsnHRM5.A2:QuouesrltifbnAkY
ouAceptaJbOfY ferA5DevlopingOff-teshJobAInr56
BalncigMaritalnd/oFmilyLfeA5-6
Planning fo r Re tire m e nt
Ke y Te rm s
A5 - 7
N o te s and Re fe re nc e s
Chapter6
A5 - 6
A5 - 7
EmployeSctin217
OverviwoftheSlcinPs218r
BeginwithaJobAnlysi219
TheSlctionPs219r
ObtaingRldIformebV ation20
InitalSeg2cr1
CoverLtsandRéumés21
AplicatonFrms2
EthicsnHRM:WhsRourJb ’ejctingY Aplicaton?23
InterChecksandPhoSig2r5
EmploymentIrviws25
TheSofIntruvicws 26
NectivoInrdws26
SedIntrviuwc s 26
pesofSdIntruvicwTy s27
xiv
Co n t e n t s
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HighltsnHRM6.1:SampleSituaonIrvwQuestion27
MethodsfrAminstergIvws28
RealityCheck:BaviourlIntwsatBMO28
TheBusinCase:BhviourlIntwsBring Returns29
HighltsnHRMp10Mo6.2:Surveyas!To stPopularIneviw
Question231
GuidelnsforEmploymentIrviwers231
ourQuAeY stionLgal?23
HighlitsnHRM6.3:AporiatendIpr teviw
Question 23
Post-InerviwSenig23c4r
RencCfr hecks234
HighltsnHRM6.4:SampleRncCfr heckQuestion235
BoundCackgr hes235
CeditChr ecks235
Pemr ploymst236 entTe
st236 pesofTe Ty
Detrms24 alidtyofTe ngheV
ReachingSltoDecisn243
SummarizngIfomationbuAplcs 243
Decison-MakingStrey245
FinalDecso246
SmalBusineAplcato247
Sum m ary
247
Ke y Te rm s
248
Disc ussio n Que stio ns
248
H RM Exp e rie nc e : De sig ning Se le c tio n Crite ria and M e tho d s
249
Case Stud y 1: Jo b Cand id ate Asse ssm e nt Te sts Go Virtual
250
Case Stud y 2 : Pro s and Co ns o f Cle aning Up the “ Ré su- M é ss”
Case Stud y 3 : Se arc hing fo r Sp ie s
N o te s and Re fe re nc e s
Chapter7
251
252
253
raingdDTevlopment256
raing257 TheScopf
rainAg258StecohTp
EthicsnHRM:Maoluntary?259dV
Phase1:ConductigheNedsAment260
HighltsnHRM7.1:NotesnRapidNedsAment261
OrganiztoAlys26
skAnalyi26 Ta
PersonAalyi263
Co n t e n t s
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HighltsnHRM7.2:ACompetncyAsmentforaManageril
Positn264
Phase2:DringomtheT 264
DevlopingIstrucaObjectivs264
AseingthRadMoraines265 tvofT
IncorpatighePlsfL 265
CharcteisofInu269
Phase3:ImplemraingPomethT —TraingDelvyMethods269
Onraing270 -theJobT
SpecialAsgnments27
Craing,IteshpdGoovT vernmraing27 etlT
HighltsnHRM7.3:IntershipPogamatDurhamColeg27
Simulations273
E-learnig274
Behaviour Modeling275
Role-Paying 275
Coaching276
CaseStudi276
SeminarsdCencso2f76r
BlendLarig276
Comlasr e)Instru(Lcio27
raingPomhse4:EvlutT 27
RealityCheck:AC-LevlEaution278scFr
Criteon1:Racs279
Criteon2:Lag79
Criteon3:Bhavu279
Criteon4:Rsul, etrnoIvsment(ROI)280
TheBusinCase:RringIvtmuoT ent281
raingdDAtolTevpmentPograms28
HighltsnHRM7.4:BenchmarkingHraingR28 T
OrientaodOnding28b3oar
HighltsnHRM7.5:ChecklistforOrientgNewEmployes283
HighltsnHRM7.6:WowingtheCandiate285
Braing285 scSklT
raing286 EthcsT
Draing286 vestydIcluoT
SmalBusineAplcato28
Sum m ary
289
Ke y Te rm s
289
Disc ussio n Que stio ns
xvi
289
Co n t e n t s
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H RM Exp e rie nc e : Training and Le arning Princ ip le s
290
Case Stud y 1: Se rvic e at the Fairm o nt Chate au W histle r
290
Case Stud y 2 : Pe o p le De ve lo p m e nt Strate g ie s at Cre d it Unio n Ce ntral o f
Saskatc he w an
291
Case Stud y 3 : Onb o ard ing at Cap ital Po w e r
N o te s and Re fe re nc e s
Chapter8
292
293
PerfomanceManagement298
PerfomanceManagementSysms29
ThePurposf manceManagement29
WhyPerfomanceManagementSysmsSometimesFail301
DevfclotipngPaErmanceManagementSysm302
WhatAehPrfomanceSds?30tr
LegalIsu305
ScesofPurmanceRviwInformation306
gethr:360-DPuinIAEvalogsTo 8
raingApse309 T
RealityCheck:PrfomanceEvlutios310
TheBusinCase:Rnk312 dY
HighltsnHRMsCh8.1:Supervio’ cklstfhPmanceRviw
Meeting315
PerfomanceRviwMethods315
raitMeT thods315
HighltsnHRM8.2:GraphicRtngSalewithPovisnfrComments316
HighltsnHRM8.3:ExampleofaMixed-Sctanlr317
BehaviourlMethods318
HighltsnHRM8.4:BARSandBOSExamples319
ResultMethods319
HighltsnHRM8.5:Pd32er1socnalS
WhichPerfomanceEvlutioMethodSul ouUYse?32
PerfomanceRviwMeetingsadFbckSo32
pesofPrmTy anceRviwMeetingsadFbckSo32
HighltsnHRM8.6:TheFd-orwdParefomanceEvlutio
Interviw324
ConductighePrfmanceRviwMeetingorFdbackSs324
HighltnHRM8.7:EvalutingPerfomanceRmotely325
EthicsnHRMetchGo:Sr als328
ImovingPprefmance329
HighltsnHRM8.:ContiusFedback,Pl30
HighltsnHRM8.9:DealingwietohAFailur cvGoals32
SmalBusineAplcato:DoesaSmalBusineNeedtoFrmalyEvute
ItsEmployes?3
Co n t e n t s
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Sum m ary
334
Ke y Te rm s
334
Disc ussio n Que stio ns
335
H RM Exp e rie nc e : Pe rfo rm anc e Diag no sis
335
Case Stud y 1: “ Pro je c t Oxyg e n” Re susc itate s Go o g le ’s Po o r- Pe rfo rm ing
B o sse s
336
Case Stud y 2 : Ad o b e Ditc he s Fo rm al Pe rfo rm anc e Re vie w s—and W ants to H e lp
Othe r Co m p anie s Do So To o
N o te s and Re fe re nc e s
337
338
Part4
ImplementigCompensatiodScury
Chapter9
ManagiCompensatio342
COVID-19CompensatiofrElWorkesandCEOs34
WhatIsCompensation?345
StraegicCompensatio346
LinkgCompensatioOrganiztolObjectivs346
MotivangEmouplghyCestr ompenstiacolE:Txhr348
TheBasforCompensatio350
EthicsnHRM:ExecutivPay351
DetrmingCompensatio—TheWageMix351
InteralFcos352
HighltsnHRM9.1:ComparisonfCompensatio
Straegis35
ExternalFcos354
JobEvalutinSysems356
JobRankigSystem356
JobClasifctonSyem356
PointSysem357
Hnisthgl RMmSa:2.9 Relp Cgnita PMerofh boJdht
noitaulEv 853
HighltsnHRM9.3:SampleofCompensablFctor
ShowingDes358gr
JobEvalutinfrManagementPosi359
TheCompensatioS359ruc
WageandSlryuvs359
HighltsnHRM9.4:CompensatioSurvyfBealoHRand
AcountigPfesarlCand360
TheWageCurve361
PayGrades 361
Rate ngs36
Competncy-BasdP36
xvi
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GovernmentRgulaiofCompensatio365
TheCanada Labour Code365
EmploymentSdsLgialor365
OtherLgislaton36
SignfcatCompensatioIu36
PayEquit:l forWorkof alue36 EqV
MeasuringComparbilty367
TheIsuofWage-RatComesion36pr7
RealityCheck:PayEquit 368
TheBusinCase:CashingOut369
encyra36sp9 PT
SmalBusineAplcato371
Sum m ary
3 73
Ke y Te rm s
3 73
Disc ussio n Que stio ns
3 73
H RM Exp e rie nc e : W hy This Salary?
3 74
Case Stud y 1: Pay De c isio ns at Unive rsity H e alth Fo o d s o n W he e ls
Case Stud y 2 : Jo b Evaluatio ns at CB C/ Rad io - Canad a
N o te s and Re fe re nc e s
Chapter10
3 75
3 75
3 76
Payforemance:ItivRwds380ar
StraegicRsonfIvPla381
ObIncetivPlasLjkoOr382 ganiztol
Remquir entsforaSuclIivP38
SetingPrfomanceMees38aur
AdminstergIcvPla384
HighltsnHRM10.:SetingPrfomanceMees:ThaKur y384
IndivualcetPs385
Piecwork386
SdHtanr ouPlan387
Bonuse387
MeritPay38
Lump-SumMeritPay389
Non-monetaryAwdsanRr ecogit389
SalesInctiv390
HighltsnHRM10.2:CustomourNoizeYncashItvAwds391ar
Incetivsfor PofesinalErmployes392
TheExcutivPaykg39
ExecutivCAomcuntabily395 pensatio:Ehcd
HighltsnHRM10.3:The“Swetns”ofExcuivPrk396
GroupIncetivPlas396
Co n t e n t s
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EthicsnHRM:ExecutivInsadPrkMeo397tr
amTe Compensatio397
HighlitsnHRM10.4:Leson ar d:Desaimgn fEectvTe
Ince tiv s 398
GainshargIcetvPl398
EnterpisIcvPla39
Pofit-Srhangls39
EmployeStckOwnershipPlan(ESOPs)40
RealityCheck:EmployeStckOwnershipandPyfo mancetGolder
Asociate401
TheBusinCase:InctivPlRoyaBnkfCanad(RBC)402
SmalBusineAplcato402
Sum m ary
403
Ke y Te rm s
404
Disc ussio n Que stio ns
404
H RM Exp e rie nc e : Aw ard ing Salary Inc re ase s
404
Case Stud y 1: Exe c utive Co m p e nsatio n: The Case o f H yd ro One
Case Stud y 2 : Te am - B ase d Inc e ntive s: N o t Yo ur Usual Offic e
N o te s and Re fe re nc e s
Chapter1
405
406
406
EmployeBnfits409
ManagiEmployeBnfitsPgrams410
ElemfecntsivoaBE Pgrm41
StraegicBnfsPlaig41
CommunicatgEmployeBnfitsIrmation41
HighltsnHRM1.:CraftiengcvEBs
CommunicatoPgrm415
HRISandEmployeBnfits415
ConcersfManagement415
TheBusinCase:ManagitheCostfBeni417
RealityCheck:COVID-19:ReshapingWorkplaceBnfits418
EthicsnHRM:BenfitsFraud419
EmployeBnfitsRedbyLawqur 420
CandQuebcPnsiola(CP/QP)420
EmploymentIsurac(E)420
Workes’CompensatioIurc420
DetionaryMasc jorEmployeBnfits42
HeBalthcr nfis42
HighltsnHRMam1.2:Te AoachtCpr ostContaimentaThEcomical
324 InsuGraceGrE)Toup(
PaymentforTimeNotWorked423
LifeInsurac425
x
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Remtir entPograms425
Pensiola426
EmployeSrvics:CeatngWor rk–LifeStng428
HighltsnHRM1.3:WhoseMoneyIst?429
CeatingFmr ily-FrendStg429
EmployeAsitancPgrms430
CounseligSrvc430
Ce430carndhEli
HighltsnHRMukonGo1.4:Y vernmsPublicServCnt’ ommision431
HighltsnHRM1.5:SimonFraseUniverstyMakesCaPhildcroty432
EmployeBnfitsaEmployerBandig432
HighltsnHRM1.6:BusineDevelopmentBakofCanad(BDC)43
SmalBusineAplcato43
Sum m ary
434
Ke y Te rm s
435
Disc ussio n Que stio ns
435
H RM Exp e rie nc e : Und e rstand ing Em p lo ye r B e ne fit Pro g ram s
Case Stud y 1: Evaluate the W o rk–Life Clim ate in yo ur Co m p any
436
436
Case Stud y 2 : M ap le Le afs’ Fam ily- Frie nd ly B e ne fits: An Une xp e c te d B ac klash
N o te s and Re fe re nc e s
Chapter12
437
438
Pomr otingSafeydHealth41
SafetyndHshLwealt:I’ 43
Acts andRegultios4
DutiesandRpobl45
HighltsnHRM12.:HealthndSfeyChecklistforNewEmployes 46
HighltsnHRM12.:AWorldLeainHealthndSfy48
PenaltisforEmployerNoncompliance49
Workes’Compensatio450
Pomr otingaSfeWoonmrkEvi ent450
CeatingCur ofSltuaey451
cingSEforaetyRuls452
EthicsnHRM:Bury theRd453cor
InvestigadRAcorients45
ColingadEtmr inatgHealthHads45zar
SafetyHdsnIauzer45
HighltsnHRM12.3:DistracedDrivng:ASampleHRPolicy456
HighltsnHRM12.4:EmergncyRadisChecklist459
CeatingHer althyWoonmrkEvi ent460
gonmEr ics461
ChemicalHds462zar
Co n t e n t s
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Buildng etrPhysicalndEmotinalHealthmong Employes462
TheBusinCase:InvtigEmployeHealth463
HighltsnHRM12.5:DeesionpthrWorkplace46
JobSesandBtr uo465
Job-RelatdSs46r
CopingwithSes467r
RealityCheck:CNCeforOcnt cupationlHealthndSfy468
SmalBusineAplcato469
Sum m ary
469
Ke y Te rm s
4 70
Disc ussio n Que stio ns
4 70
H RM Exp e rie nc e : Re d uc ing Em p lo ye e Stre ss
4 70
Case Stud y 1: W o rkp lac e Safe ty and Yo ung W o rke rs
4 71
Case Stud y 2 : To o M uc h Fatig ue and Jo b Stre ss?
4 72
Case Stud y 3 : COVID- 19 and W o rking fro m H o m e
4 73
N o te s and Re fe re nc e s
4 74
Part5
Enhacigmploye–MangementRlaios
Chapter13
EmployeRightsandDiscplne47
eRThr gimesofEmploymentLaw478
TheCommonLawofEmployment479
StauoryEmploymentRgulaio 480
Arbitaon480 ColectivBganLsrdbu
UnderstaighIvulEmploymentContrac481
TheRulsGovernigDsmisal482
DismisalofNonuiEmploye:WrongfulDismisal482
HighltsnHRM13.:CautionwithContracs482
HighltsnHRM13.2:DeconstruigConstruciveDismisal483
TheBusinCase:ThDangerofChangiCormntracTe withou
theEmsAemgrploy’ ent48
DismisalofUniozedEmploye:JustCause485
EmployePrivacRghts487
PrivacyIsuethWorkplace 487
HighltsnHRM13.:SocialMediaUse inRecrutmentad
Selction489
RealityCheck:PrivayIsuwithNewchnolgis491 Te
EthicsnHRM-Spy:ing?u49er2vso
EmployeConductsiehWorkplace493
HighltsnHRM13.4:TheLongArmoftheEmployer49
DiscplnaryPoed49u
TheRsultofInaci495
xi
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SetingOrganiztolRues496
InvestigahDciplnaryPobem497
AoachestpDr ilnayActo49
InformingtheEmploye50
AlternaivDsputeRolinP50c1dr
ManagerilEthcsmployeRatins504
SmalBusineAplcato50
Sum m ary
505
Ke y Te rm s
506
Disc ussio n Que stio ns
506
H RM Exp e rie nc e : Le arning ab o ut Em p lo ye e Rig hts
507
Case Stud y 1: Dism issing an Em p lo ye e fo r Ab se nte e ism
Case Stud y 2 : Disc harg e d fo r Off- Duty B e havio ur
N o te s and Re fe re nc e s
Chapter14
507
508
509
TheDynamicsofLaburReltions51
HighltsnHRMourLabRstYelionK14.:Te w-How513
GovernmentRgulaiofLbr etns513
TheIndustrial Relations Disputes and Investigation Act andtheLabour Relations
Code513
TheLabourRltinsPc514r
WhyEmployesUnioze514
HighltsnHRM14.2:Homeworkes:CaInviblLca51uF d’
OrganizCampaigns516
HighltsnHRM14.3:ChalengswithLabourOrganizthe
GigEconmy519
RealityCheck:WalmartAvoidngUniozatAlCost520
UnioCertifcaon520
HighltsnHRM14.:UnfairLbouPctes521
ContracNegotian521
Decrtifaon 521
EthicsnHRM:CaterpilaClos-eMElctr otivePlan52
ImpactofUniozatManagers52
Ses,FuntcrioadLhpfbUnions523
TheCanadiLbourCoes523ngr
InteraioldNationlUnios524
LocalUnions524
LabourReltinshPubcSor52
PolitcaNaefhLtaburo–MangementRlaioshp526
StrikesnhPublc o526
TheBgainPocsr527
PeparingfoNegotians 528
Co n t e n t s
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Dcetivslo5pn28gBaSrdTa
TheBusinCrustandeS:BvigMolT neyathSme
Time:CandSfewayndUnitedFoaCommecialWor rkes
Local1583
ManagementadUnioPBwga531r einColectiv
ResolvingBaDr edlocks53
TheColectivAmgr ent534
TheIsuofManagementRighs534
UnioSecurtyAmg ents534
HighltsnHRM14.5:ItemsinaColectivAmgr ent53
AdminstraofheColectivAmgr ent53
NegotiadGrievancPs5o3dur
RightsArbaon536
SmalBusineAplcato537
Sum m ary
538
Ke y Te rm s
538
Disc ussio n Que stio ns
538
H RM Exp e rie nc e : Le arn ab o ut Unio ns
539
Case Stud y 1: Unio nizatio n o f Farm W o rke rs
Case Stud y 2 : W alm art Sto re s in Canad a
Answ e rs to H ig hlig hts in H RM 14 .1
N o te s and Re fe re nc e s
539
540
541
542
Part6
ExpandigHumanRcesMaour nagementHorizons
Chapter15
InteraiolHumanRcesMaour nagement54
ourInteaimlEvAyzgY ent546
PolitcaFrs548
EconmicFators548
SociultraFs548
EthicsnHRM:BribeyAoad549
HighltsnHRM15.:HRProuacndtihesWorld:PentaLv
Benfits50
chnolgiaFtrs50 Te
RealityCheck:GlobalversuLcHRMPracties51
ourInteailOpAyzgY erations52
MaourInteailOpgY erations54
HighltsnHRM15.2:RencCfr hecking56
RecruitngIaoly56
SelctingEmployesIntrai560
HighltsnHRM15.3:Skilsof ExpatrieManagers562
xiv
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raingdDTevlopment564
ManagiPersoldFmilyLfe569
Repatrion569
HighltsnHRM15.4:TheChalengsofRpatrin:ACandi
Example570
HighltsnHRM15.:RepatrionChecklist571
Compensatio572
CompensatiofHost-CountryEmployes572
CompensatiofHost-CountryManagers574
CompensatiofExrManagers574
PerfomanceAprisl576
TheBusinCase:ThCostfEmployingExatres578
AnalyzigtheIroLbmuEv ent580
ColectivBganOtr herCountries581
HighltsnHRM15.6:DirtyLis581
InteraiolLbuOrganiztos582
LabourPticpnManagement582
SmalBusineAplcato583
Sum m ary
584
Ke y Te rm s
584
Disc ussio n Que stio ns
584
H RM Exp e rie nc e : A Canad ian (Exp atriate ) in Paris
Case Stud y 1: Cultural Co nund rum
585
585
Case Stud y 2 : Re c ruiting and Re taining Inte rnatio nal Em p lo ye e s
N o te s and Re fe re nc e s
N am e Ind e x
587
593
Org anizatio n Ind e x
Sub je c t Ind e x
586
595
598
Co n t e n t s
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Preface
The tenth Canadian edition of Ma n a gin g Hu ma n Resou rces will place students at
the forefront in understanding how organizations can gain sustainable competitive
advantage through people. The role of human resources (HR) professionals is no
longer limited to service functions such as recruiting and selecting employees.
Today, HR managers assume an active role in the strategic planning and decision
making in their organizations. Those managers who are good at it can have a
major impact on the success of their firms. And human resources management
(HRM) is not limited to HR staff. The best organizations recognize that managing
people is the job of every manager, working in partnership with HR.
Each edition of the book highlights the ways in which the environment for
managing human resources is changing but reveals that the goal of using an
organization’s talent in the best way possible never changes. The purpose of this
book is twofold: (1) to equip students with the tools and practices of HRM and
an appreciation for the changes that they can make by understanding how best to
manage people, and (2) to present the most current challenges and opportunities
graduating students will face when it comes to today’s HRM environment. These
challenges exist both for those who will become HR managers and those who
will become other types of managers.
Toward that end, the book lays out in broad terms the key challenges in HRM
today including issues related to the COVID-19 pandemic. It includes a discussion
of the HR strategies pursued by firms. Other aspects include how social media
are affecting HRM and employees’ privacy rights.
Strategy and talent have become such central concerns of HR today that we
continue to emphasize these topics, as well as core HR areas, such as compensation and benefits, emp loyee relations, p erformance management, and international HRM. The detailed coverage of these topics solidifies Ma n a gin g Hu ma n
Resou rces as perhaps the premier text for thought leadership, especially regarding
the global talent pool. Relating to this central theme of managing talent are such
themes as emp loyee diversity and how organizations can leverage all typ es of
differences among their workers to their strategic advantage.
Whether the reader becomes a manager, a supervisor, or an HR specialist or
is employed in other areas of the organization, Ma n a gin g Hu ma n Resou rces provides a functional and practical understanding of HR programs to enable readers
to see how HR affects all employees, the organization, the community, and the
larger society.
Organizations in today’s competitive world are discovering that it is how the
individual HR functions are combined that makes all the difference. Managers
typically do not focus on HR issues such as staffing, training, and compensation
in isolation from one another. Each of these HR practices is combined into an
overall system to enhance employee involvement and productivity.
W h a t ’s N e w in t h e Te n t h C a n a d ia n Ed it io n
For each edition, updates are made to laws, regulations, guidelines, and HR practices to reflect current contexts. To help instructors incorporate the new material
into their courses, the following is a list of significant chapter-by-chapter changes.
Ch ap ter 1: Th e Wor ld of Hu m an Resou r ces Man agem en t
●
●
new material on the effects of the COVID-19 pandemic on human resources
management
new material on human resources management roles and jobs
xvi
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●
●
●
new material on the effects of technology on human resources management,
big data, and artificial intelligence
new material on Green Human Resource Management (GHRM), gender fluidity, and the effects of employee attitudes and turnover
updated/ revised Highlights in HRM 1.1 and 1.2
Ch ap ter 2: Str ategy an d Hu m an Resou r ces P lan n in g
●
new section on high-performance work systems
●
new material on the effects of COVID-19 on human resources planning
●
new material on low-cost and differentiation strategies
●
added more information on values-based hiring
●
new Highlights in HRM 2.5 on COVID-19 and the labour surplus
Ch ap ter 3: Eq u ity, Diver sity, an d In clu sion : Th e Legal En vir on m en t
●
●
●
●
complete reorganization for better student engagement
new material on court cases, such as Tawney Meiorin and other cases related
to religious accommodation
more concise section on employment equity
new section on inclusionary p ractices and th e differences with diversity
management
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new case material and examples related to equity, diversity, and inclusion
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updated/ revised Highlights in HRM 3.2, 3.5, 3.8, and 3.9
Ch ap ter 4: Job An alysis an d Wor k Design
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new material on job descriptions, including competency-based job descriptions
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new section on job crafting and job carving
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new Highlights in HRM 4.3 on flextime and working from home in the midst
of the COVID-19 pandemic
new case material on Zap p os and up dated examp les of work design in
Canadian organizations
more examples of job analysis
Ch ap ter 5: Exp an d in g th e Talen t Pool: Recr u itm en t an d Car eer s
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new discussion on how the COVID-19 pandemic has affected organizational
recruitment strategies and programs
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new material on employer branding and recruitment
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new material on employee referral programs
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new section on targeted recruitment
Ch ap ter 6: Em p loyee Selection
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thoroughly revised and updated chapter content, references, and all end-ofchapter questions
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new selection method validity table (Figure 6.3) and related discussion added
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section on application forms has been moved to earlier in chapter
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reorganized for better student understanding
new Ethics in HRM box (“Who’s Rejecting Your Job Application?”), discussing
application screening AI software
reorganization and enhancement of the employment interviews section
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biodata information now presented with application form content
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new Highlights in HRM 6.2 on popular interview questions
Ch ap ter 7: Tr ain in g an d Develop m en t
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new discussion on the COVID-19 pandemic and its effects on training and
development
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new Canadian examples of training and development programs
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new section on diversity and inclusion training
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new material on assessing the effectiveness of training programs
Ch ap ter 8: Per for m an ce Man agem en t
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new Highlights in HRM 8.7 on evaluating performance remotely
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new Highlights in HRM 8.9 on dealing with performance failures
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new Reality Check box about technology organizations and their methods of
evaluating performance
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revised The Business Case box with updated examples
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updated legal guidelines for performance reviews
Ch ap ter 9: Man agin g Com p en sation
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new discussion on issues related to COVID-19 “pandemic pay”
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new material on specific steps to linking pay and performance
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new material on the new federal pay equity legislation
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new section on pay transparency
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updated/ revised Highlights in HRM 9.4 and Small Business Application box
Ch ap ter 10: Pay for Per for m an ce: In cen tive Rewar d s
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new discussion about the effects of the COVID-19 p andemic on incentive
programs
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updated material on executive compensation for the top 100 CEOs in Canada
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new material on measuring performance for incentives
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revised/ updated Highlights in HRM 10.2 with information on Generation Z
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new Ethics in HRM box on executive incentives and perks
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new Reality Check box on employee stock ownership and pay for performance
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revised/ updated The Business Case box with new data as of 2019
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new case study on executive compensation at Hydro One
Ch ap ter 11: Em p loyee Ben efits
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new discussion on the effects of the COVID-19 pandemic on employee benefits, including mental health and wellness
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new material on the advantages and disadvantages of flexible benefits plans
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new The Business Case box on managing the costs of benefits
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updated material on communicating benefits
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new Reality Check box on reshaping workplace benefits as a result of the
COVID-19 pandemic
updated data on retirement policies and new material on comparing defined
benefit and defined contribution plans
updated Highlights in HRM 11.3 with information on worker protections
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new discussion on group insurance plans that provide income protection
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updates in examples of benefits at major Canadian organizations, including RBC
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new section on employee benefits as employer branding
Ch ap ter 12: P r om otin g Safety an d Health
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new material on dealing with COVID-19 at work
new material on distracted driving, including a sample HR policy (Highlights
in HRM 12.3)
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new discussion on the legalization of cannabis and the response by employers
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updated data on workplace accidents and fatalities across Canada
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n ew d iscu ssion on workp lace h ealth an d safety legislation in Can ad a,
including Bill C-45 (occupational health and safety negligence)
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new Highlights in HRM 12.1 on health and safety checklist for new employees
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new case study on workplace safety and young workers
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new case study on the impacts of the COVID-19 pandemic on employees
Ch ap ter 13: Em p loyee Righ ts an d Discip lin e
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new material on implied contracts and related legal cases
new material, along with a new Highlights in HRM 13.3, on constructive
dismissals
updated discussion on employee privacy rights regarding working from home
during the COVID-19 pandemic (Ethics in HRM box)
new material on artificial intelligence, social media, and p rivacy issues in
human resources management
new case study material on employee dismissals
Ch ap ter 14: Th e Dyn am ics of Lab ou r Relation s
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new discussion on the challenges of union organizing in a gig economy (new
Highlights in HRM 14.3)
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new material on Walmart and unionization in Canada (new Reality Check box)
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new discussion and data on strikes and lockouts in Canada
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updated data and new material on unionization in Canada
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updated material and examples on interest-based bargaining (IBB)
Ch ap ter 15: In ter n ation al Hu m an Resou r ces Man agem en t
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new Highlights in HRM 15.1 on parental leave in Canada in comparison with
other countries
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new material on work permits and visas for working in Canada
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new material on the challenges of repatriation (Highlights in HRM 15.4)
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new material on global labour relations issues
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updated discussion on reference checking
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updated data and statistics on HRM practices globally
Fe a t u r e s o f t h e B o o k
We have introduced overall text improvements that more accurately reflect HRM
in today’s business world and that will help the reader understand HRM issues
more effectively.
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The tenth Canadian edition reflects the body of knowledge required by students to p ass the national knowledge exam, given by the Canadian Council of
Human Resources Associations, as one of the step s toward the granting of the
HR designation, the Certified Human Resources Professional (CHRP). The book
also covers the material needed for the examinations conducted by the Human
Resources Professionals Association of Ontario (HRPA) and their related certifications. The lead author, Dr. Monica Belcourt, p articip ated in the develop ment
of the standards for the national certification p rocess. This text covers much of
the material being tested on the national knowledge exam. As a CHRP herself,
Dr. Belcourt is very familiar with the comp etencies required for the p rofession
and has written the text with these p rofessional comp etencies as the foundation
for learning about HR. The second author, Dr. Parbudyal Singh, was a member
of the task force that develop ed the comp etencies required for p rofessional certification in Ontario. He continues to p rep are material for HRPA for certification
p urp oses, including the examinations and p rep aratory courses.
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Lear n in g Ou tco m es. Learning Outcomes listed at the beginning of each
chap ter p rovide the basis for the Integrated Learning System. Each outcome
is also listed in the margin of the chap ter in which it ap p ears, along with a
thought-p rovoking question designed to get students thinking about how
the related content ap p lies to them p ersonally. The outcomes are revisited
in the chap ter summary and discussion questions and in all of the book’s
ancillaries.
Sm all Bu sin ess Ap p lication . Continuing in this edition is the inclusion of
a section in each chap ter that takes the p rincip les and p rescrip tions of a
functional area, such as recruitment, and demonstrates how these can be
ap p lied in a small business, of which there are about 1 million in Canada
(which would reflect almost 98 percent of businesses in Canada). This feature
was initiated by Angus Duff, a graduate from the PhD p rogram in Human
Resources Management at York University and a former HR manager with
extensive experience in small and large businesses. Revisions to these cases
and new cases have been added.
H RM Exp er ien ce. We build on a p op ular feature in p revious editions of
Ma n a gin g Hu ma n Resou rces by including many new experiential exercises
to explore significant issues in HR. These skill-building exercises will help
students gain practical experience when dealing with employee/ management
concerns such as p ay for p erformance, effective team building, emp loyee
benefits, reducing employee stress, employee rights, balancing competitive
challenges and emp loyee concerns, customizing HR for different typ es of
human capital, designing selection criteria and methods, and assessing the
strategic fit of high-performance work systems. Students can work through
the new exercises on either an individual or a team basis.
Hu m an r esou r ces in for m ation system s (HRIS). Throughout the text, we
have sp ecifically highlighted the use of HRIS to facilitate the managing of
employees and the efficient performance of HR functions. For example, the
impact of information technology on HR and the role of HRIS in such areas
as compensation, recruitment and selection, training, job analysis, and safety
are discussed.
Diversity an d in clusion . Because we believe that diversity and inclusion issues
are an integral part of every HRM activity, updated and expanded coverage is
included throughout the text.
COVID-1 9 an d H RM. Th e p andemic h as significantly affected organizations and how people are supported and managed. We deal with this issue
throughout the text.
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HRM str ategy. The increasingly important role HRM plays in strategic planning is covered in Chapter 2. However, many of the chapters on functional
areas, such as recruitment, training, and compensation, are now approached
from a strategic perspective.
Cover age of glob al issu es. Global and international concerns are covered in
greater detail. This includes issues such as the impact of globalization on HR,
multidomestic corporations, and global rights issues such as data protection
and intellectual property. Although these issues have perhaps been peripheral
to HRM in the past, they are increasingly seen as front and centre by many
organizations.
Cu r r en t HRM legislation an d cou r t cases. A complete and thorough review
and up date of legislation and court cases governing HRM was written for
a p revious edition by Dr. David Doorey, a p rofessor of emp loyment and
labour law at the School of Human Resource Management at York University.
Dr. Doorey has a BA and an MIR (Industrial Relations) from the University
of Toronto, an LLM from the London School of Economics, and an LLB and
a PhD from Osgoode Hall Law School. He practiced labour and employment
law in British Columbia and Ontario. Check out his blog at http:/ / lawofwork
.ca for current insights into these issues.
Up d ated b oxed elem en ts. Many new Highlights in HRM, Reality Check,
Ethics in HRM, and The Business Case features have been added. As a former
president of HRPA, Dr. Monica Belcourt is very involved in the HR profession,
with access to some of the foremost thought leaders in HR in Canada.
In ter n et. The ever-growing role of the Internet in HR activities is evident
throughout the text. A few examples include social networking and mobile
recruiting in Chapter 5, Web-based training and e-learning in Chapter 7, and
online 360-degree evaluation in Chapter 8.
En d -of-ch ap ter cases. The end-of-chapter case studies highlight chapter content that provide students with both current and practical HR problems and
issues.
In s t r u c t o r Re s o u r c e s
CCTA
Th e Cen g ag e Can ad a Teach in g Ad van tag e p rogram delivers research -based
instructor resources that promote student engagement and higher-order thinking
to enable the success of Canadian students and educators. With a focus on quality,
all of our resources are copyedited and questions are reviewed to ensure the
content is accurate and relevant to the new edition.
The following instructor resources have been created for Ma n a gin g Hu ma n
Resou rces, Tenth Canadian Edition. Access these ultimate tools for customizing
lectures and presentations at https:/ / faculty.cengage.com.
Te st B ank
Th e test bank is available on a cloud-based p latform. Te stin g Pow e r ed b y
Cogn er o ® is a secure online testing system that allows instructors to author, edit,
and manage test bank content from anywhere Internet access is available. No
sp ecial installations or downloads are needed, and the desktop -insp ired interface, with its drop -down menus and familiar, intuitive tools, allows instructors
to create and manage tests with ease. Multiple test versions can be created in an
instant, and content can be imported or exported into other systems. Tests can
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be delivered from a learning management system, the classroom, or wherever an
instructor chooses. Testing Powered by Cognero for Ma n a gin g Hu ma n Resou rces
can be accessed through http:/ / login.cengage.com.
This resource was written by Parbudyal Singh at York University and thoroughly updated for this edition by Stephen D. Risavy. It includes over 850 multiplechoice questions written according to CCTA guidelines for effective construction
and development of higher-order questions. Also included are true-or-false questions and essay questions.
Po w e rPo int
Microsoft ® PowerPoint ® lecture slides were revised and up dated by Elke Price.
There is an average of 30 slides per chapter, many featuring key figures, tables,
and photographs from Ma n a gin g Hu ma n Resou rces. Instructor notes have been
incorporated throughout, making it simple for instructors to customize the deck
for their courses.
Im ag e Lib rary
This resource consists of digital copies of figures, tables, and photographs used
in the book. Instructors may use these JPEGs to customize the PowerPoint slides
or create their own PowerPoint presentations. The Image Library Key describes
the images and lists the codes under which the JPEGs are saved.
Vid e o s
Instructors can enhance the classroom experience with the exciting and updated
industry videos p rovided directly to students through MindTap . Th ese videos
have been selected to accompany Ma n a gin g Hu ma n Resou rces and can be used
in class for discussion and activity purposes.
Instruc to r Guid e
Th e Instructor Guide was up dated and revised by Step h en D. Risavy at th e
Lazaridis School of Business and Economics at Wilfrid Laurier University. It is
organized according to the textbook chapters and addresses key educational concerns, such as typical stumbling blocks student face and how to address them. The
guide also contains sample lesson plans, learning outcomes, suggested classroom
activities, and a resource integration guide to give instructors the support they
need to engage their students within the classroom.
M ind Tap
MindTap is an outcome-driven application that propels students from memorization to mastery. It’s the only platform that gives you complete ownership of your
course. With it, you can challenge every student to think and act like a manager,
build their confidence, and empower them to be unstoppable.
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Access ever ythin g you n eed in on e pla ce. Cut down on prep with preloaded,
organized course materials in MindTap. Teach more efficiently with interactive multimedia, assignments, quizzes, and more. And give your students the
power to read, listen, and study on their phones, so they can learn on their
terms.
Empower you r stu den ts to rea ch their poten tia l. Twelve distinct metrics give
you actionable insights into student engagement. Identify top ics troubling
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your entire class and instantly communicate with struggling students. And
students can track their scores to stay motivated toward their goals. Together,
you can accelerate progress.
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You r cou r se. You r con ten t. Only MindTap gives you comp lete control over
your course. You have the flexibility to reorder textbook chapters, add your
own notes, and embed a variety of content including OER. Personalize course
content to your students’ needs. Students can even read your notes, add their
own, and highlight key text to aid their progress.
A dedica ted tea m, when ever you n eed them. MindTap isn’t just a tool; it’s
backed by a personalized team eager to support you. Get help setting up your
course and tailoring it to your specific objectives. You’ll be ready to make an
impact from day one. And we’ll be right here to help you and your students
throughout the semester—and beyond.
St u d e n t Re s o u r c e s
M ind Tap
Modern students require modern solutions. MindTap is a flexible, all-in-one
teach ing and learning p latform th at includes th e full ebook, a customizable
learning p ath, and various course-sp ecific activities that drive student engagement and critical thinking.
MindTap features include
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Ad ap tive Test P r ep reduces exam anxiety and allows you to create practice
quizzes covering multiple lessons in a low-stakes environment. You receive
immediate feedback, so you know where you need additional help, and the
test bank–like questions prepare you for what to expect on the exam. With an
average of 55 questions per lesson, you can create multiple unique practice
quizzes.
You Mak e th e Decision . To help you focus on thinking critically, these mini
simulations place you in interactive scenarios and ask you to make decisions
on behalf of the company. The scenario changes at each decision point so
that you receive a unique experience based on the choices you make. The
effectiveness of the business decisions you make along the way will result in
success, failure, or something in between.
In d u str y In ter view s. Updated videos feature HR professionals and managers
from a cross-section of industries, helping to reinforce the chapter concepts.
Ete xtb o o ks
As well as a printed textbook option, Ma n a gin g Hu ma n Resou rces is also available in an etextbook format. Within the etextbook, you can organize and personalize your study experience with highlighting and notetaking tools. Additionally,
you can access your etexbook offline anytime and anywhere by downloading
the free Cengage Mobile app, eliminating any worries about connectivity issues.
Do w nlo ad the Ce ng ag e M o b ile Ap p
Get access to a full, interactive etextbook, readable online or off; study tools that
empower anytime, anywhere learning; and 24/ 7 course access. The Cengage Mobile
app keeps you focused and ready to study whenever it is convenient for them.
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Mobile app features include
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ReadSpeaker will read the text to you.
Flashcards are prepopulated to provide you with a jump start for review—or
you can create your own.
You can highlight text and make notes in your MindTap Reader. Your notes
will flow into Evernote, the electronic notebook app that you can access anywhere when it’s time to study for the exam.
A c k n o w le d g e m e n t s fo r t h e Te n t h C a n a d ia n Ed it io n
In preparing the manuscript for this edition, we have drawn on not only the current
literature but also the current practices of organizations that furnished information
relating to their HR programs. We are indebted to the leaders in the field who have
influenced us through their writings and personal associations. We have also been
aided by our present and former students, by our colleagues at HRPA with whom
we have been associated, by HR managers, and by our academic colleagues. In
this edition we welcome the contributions of Professor Stephen D. Risavy, who did
a superb job of the revisions for Chapter 6, Employee Selection. Dr. Risavy is an
associate professor in the Lazaridis School of Business and Economics at Wilfrid
Laurier University and he teaches and actively publishes research in the area of
organizational behaviour and human resources management. Dr. Risavy holds a
PhD from the University of Guelph and MASc and BA degrees from the University
of Waterloo. He is also a Certified Human Resources Leader (CHRL) with industry
experience in HR and management consulting. Dr. Risavy has also written material
for the HRPA’s certification examinations.
We are particularly appreciative of the review of legislation and court cases
by Dr. David Doorey. Dr. Doorey also revised Chapter 13, Employee Rights and
Discipline. Because of his feedback and contribution, the reader is assured that
the “legal content” is accurate and current.
Although the HRM principles outlined in each chapter apply to both large
and small organizations, the delivery of HR p ractices in small organizations is
largely by managers and business owners rather than by HR practitioners. The
Small Business Application feature was initiated by Angus Duff, a PhD graduate
in human resources management at York University and a former HR manager. As
an HR practitioner, Dr. Duff has provided HR support to organizations as small
as 25 emp loyees and as large as 20,000. Using the material discussed in each
chap ter, Dr. Duff outlined how it could be used in a small business, of which
there are over one million in Canada. Small business represents nearly 50 percent
of all private-sector jobs, and we estimate that managers in small businesses are
managing over 5 million employees, without the assistance of an HR generalist.
Thus, this feature is extremely useful for this segment.
We would also like to thank two doctoral students in the human resources
program at York University—Marlee Mercer and Sheryl Chummar—for their excellent research work. They worked diligently in completing their tasks in a timely
manner.
We would like to express our appreciation to the following reviewers who
have helped shape this and previous editions of the text:
Ron Alexandrowich, York Un iver sity
Michael Annett, Ma cEwa n Un iver sity
Stan Arnold, Hu mber College
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Lisa Bering, Hu mber College
Kathleen Boies, Con cordia Un iver sity
Julie Bulmash, Geor ge Br own College
Jules Carrière, Un iver sity of Otta wa
Grant Currie, St. La wren ce College
Magda Donia, Un iver sity of Otta wa
Gary Gannon, Du rha m College
Robert Goulding, Du rha m College
Jim Grant, Aca dia Un iver sity
Lisa Guglielmi, Sen eca College
Roger Gunn, NAIT
Barbara Lipton, Sen eca College
Sean MacDonald, Un iver sity of Ma n itoba
Teal McAteer, McMa ster Un iver sity
Richard McFadden, Geor gia n College
Ty Menna, Un iver sity of Lethbr idge
Marc Mentzer, Un iver sity of Sa ska tchewa n
Dorothy Milardovic, Con estoga College
Ed Ng, Tren t Un iver sity
Sandra Rever, Mou n t Roya l Un iver sity
Chet Robie, Wilfr id La u r ier Un iver sity
Carol Ann Samhaber, Algon qu in College
Aaron Schat, McMa ster Un iver sity
Basu Sharma, Un iver sity of New Br u n swick
Sheldon Shiewitz, Cen ten n ia l College
Jean Taplin, Hu mber College
Trudy Temple, Un iver sity of the Fra ser Va lley
Chantal Westgate, McGill Un iver sity
Lara Loze, Du rha m College
Natalie Zhao, Simon Fra ser Un iver sity
Toby Moneit, Va n ier College
Amina Malik, Tren t Un iver sity
We appreciate the efforts of the team at Cengage Canada who helped develop
and produce this text. They include Senior Director of Product Jackie Wood, Senior
Portfolio Manager Alexis Hood, Content Development Manager Catherine GillespieLopes, Senior Content Production Manager Imoinda Romain, and Copy Editor Jessie
Coffey, as well as the wonderful sales representatives who have enthusiastically
supported the book. We also want to acknowledge the past work of Developmental
Editor Karina Hope for the first five editions. Beginning in 1998, Karina developed
the superb foundation for this text, contributing greatly to its success.
Our greatest indebtedness is to our sp ouses—Mich ael Belcourt, Nirmala
Singh , Marybeth Snell, and Mindi Morris—wh o h ave contributed in so many
ways to this book. They are always sources of invaluable guidance and assistance.
Furthermore, by their continued enthusiasm and sup p ort, they have made the
process a more pleasant and rewarding experience. We are most grateful to them
for their many contributions to this publication, to our lives, and to our families.
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Abou t th e Au th ors
M o n ic a B e lc o u r t
Mon ica Belcourt is th e foun din g Director of th e Sch ool of Human Resource
Man agemen t at York Un iversity. Ad d ition ally, sh e is Fu ll Professor, Hu man
Resou rces Man agemen t, an d fou n d in g Director of th e Grad u ate Program in
HRM at th e Faculty of Liberal Arts and Professional Studies, York University.
Sh e h as an exten sive an d varied b ackgrou n d in HRM. After receivin g a BA
in p sychology from th e University of Manitoba, sh e joined th e Public Service
Commission as a recruitment and selection sp ecialist. During her tenure with
th e federal government, sh e worked in training, HRM research , job analysis,
and HR p lanning.
Dr. Belcourt alternated working in HRM with graduate sch ool, obtaining
an MA in psychology from York University, an MEd in adult education from the
University of Ottawa, and a PhD in management from the Schulich School of
Business. Her research is grounded in the exp erience she gained as Director
of Personnel for th e 63,000 emp loyees at CP Rail; as Director of Emp loyee
Development at the National Film Board; and as a functional HR specialist for
the federal government. She has taught HRM at Concordia University, Université
du Québec à Montréal, McGill University, and York University, where she founded
and managed the largest undergraduate program in HRM in Canada. She created
Canada’s first degrees in HRM: a bachelor’s in HRM, a bachelor’s in HRM (honours), and a master’s in HRM. A full description of these degrees can be found at
www.yorku.ca/ laps/ shrm.
Dr. Belcourt was Director of the International Alliance for Human Resources
Research (IAHRR), which was a catalyst for the discovery, dissemination, and
ap p lication of new knowledge about HRM. Her research interests focus on
strategic HRM, and she has published more than 100 articles, several of which
received best p aper awards. Dr. Belcourt is Series Editor for the Nelson Series
in Human Resources Management: Ma n a gin g Per for ma n ce thr ou gh Tra in in g
a n d Developmen t; Ma n a gemen t of Occu pa tion a l Hea lth a n d Sa fety; Recr u itmen t
a n d Selection in Ca n a d a ; Str a tegic Com pen sa tion in Ca n a d a ; Str a tegic
Hu ma n Resou rces Pla n n in g; Resea rch, Mea su remen t, a n d Eva lu a tion in HRM;
In ter n a tion a l Hu ma n Resou r ces Ma n a gemen t: A Ca n a d ia n Per spective; an d
In du str ia l Rela tion s in Ca n a da .
Active in many p rofessional associations and not-for-p rofit organizations,
Dr. Belcourt was the President of HRPA of Ontario, served on the national committee for HR certification, and was a board member of CIBC Insurance and the
Toronto French School. Currently she serves on the Board of Brescia College
at the University of Western Ontario. She is a frequent commentator on HRM
issues for Workop olis, CTV, Ca n a d a AM, CBC, The Globe a n d Ma il, Ca n a dia n
HR Repor ter , and other media. She has been recognized as a champ ion of HR
by Ca n a d ia n HR Repor ter . In 2009, HRPA h on ou red Dr. Belcou rt w ith th e
award of Righ t Man agemen t HR Acad emic of th e Year—an award given for
outstanding contributions to the HR p rofession and for thoughtful leadership .
The following year, the association recognized her outstanding contribution to
the HR p rofession by awarding her the Fellow Certified HR Leader designation
(FCHRL). Dr. Belcourt was only the fourth p erson to receive the award since
its incep tion in 1936. The award is given to CHRPs who have p romoted best
p ractices in the field, up held the rep utation, and made significant contributions
in innovative ideas.
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P a r b u d y a l Sin g h
Parbudyal Singh is Full Professor and former Director of the School of Human
Resource Management at York University. Prior to this, he was the Associate Dean
of the School of Business, University of New Haven, Connecticut. He also taught at
McMaster University. His PhD studies, completed in 1998 at McMaster University,
focused on the effects of organizational strategy on executive compensation.
Dr. Singh has won numerous scholastic awards and national research grants.
Among other awards, at York University, he won the Atkinson Alumni Teaching
Award, the Dean’s Award for Excellence in Research, and the Dean’s Award for
Excellence in Teaching. He has supervised more than 50 graduate students (PhD
and master’s).
Dr. Singh’s research covers a broad array of management issues, especially
those related to the effects of the changing business environment on HRM and
industrial relations. He h as more than 100 p ublications, including articles in
top refereed journals such as In du str ia l Rela tion s, Br itish Jou r n a l of In du str ia l
Rela tion s, Hu ma n Resou r ce Ma n a gemen t, The Lea der ship Qu a r ter ly, Hu ma n
Resou r ce Ma n a gem en t Review, Jou r n a l of Bu sin ess Ethics, Jou r n a l of La bor
Resea r ch, Ma n a gemen t In ter n a tion a l Review, In ter n a tion a l Jou r n a l of Hu ma n
Resou r ce Ma n a gemen t, and Jou r n a l of Voca tion a l Beha vior. He serves on the
editorial boards of several journals.
Dr. Singh has worked as an HR manager in a large manufacturing company.
He has offered advice to more than 30 of Canada’s leading organizations. He
is actively involved with projects with both the Human Resources Professional
Association and the Pay Equity Commission (Ontario). He was ap p ointed by
the Minister of Labour (Ontario) to the Gender Pay Gap Steering Committee in
March 2015; the committee made recommendations to the government on how
to close the gender p ay gap in Ontario. In 2018, he became the first recip ient
of the Distinguished Human Resource Professional Award given by the Human
Resources Professional Association for outstanding contributions to the academic
and practitioner communities.
Sc o t t A . Sn e ll
Scott A. Snell is the E. Thayer Bigelow Research Chair of Business Administration
and former Senior Associate Dean for Executive Education at th e University
of Virginia’s Darden Graduate School of Business. Dr. Snell teaches courses in
leadership and strategic management and works with management teams on
aligning th eir h uman resource investments to better execute th eir strategies.
He is the author of 4 books and was recently listed among the top 100 mostcited authors in scholarly journals of management. He currently serves on the
board of HR People + Strategy (SHRM), and previously has served on the boards
of th e Strategic Management Society’s Human Cap ital Group , the Society for
Human Resource Management Foundation, the Academy of Management’s Human
Resource Division, the Aca demy of Ma n a gemen t Jou r n a l, and the Aca demy of
Ma n a gemen t Review.
Prior to joining th e Darden faculty in 2007, Dr. Snell was Professor and
Director of Executive Education at Cornell University’s Center for Advanced
Human Resource Studies and a Professor of Management in the Smeal College of
Business at Pennsylvania State University. He received a BA from Miami University,
as well as an MBA and PhD in business from Michigan State University. Originally
from Ohio, Dr. Snell now lives in Charlottesville, Virginia.
xvi
About the Authors
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Sh a d S. M o r r is
Shad S. Morris is the Georgia White Fellow and Associate Professor of Management
at th e Marriott Sch ool of Business at Brigh am Young University. He teach es
courses in the areas of human resources management and international business.
Prior to joining the Marriott School in 2013, Dr. Morris was Assistant Professor
of Management and Human Resources at The Ohio State University and has held
appointments at the Sloan School of Management at MIT, Copenhagen Business
School in Denmark, China Europe International Business School (CEIBS) in China,
and SKK Graduate School of Business in South Korea.
Dr. Morris’s research focuses on strategic human resource management in a
global environment. His research has been published in a number of journals,
such as the Ha r va rd Bu sin ess Review, MIT Sloa n Ma n a gemen t Review, Aca demy
of Ma n a gemen t Review, Jou r n a l of In ter n a tion a l Bu sin ess Stu d ies, Str a tegic
Ma n a gemen t Jou rn a l, Jou rn a l of Ma n a gemen t, and Hu ma n Resou rce Ma n a gemen t.
He h as worked for th e World Bank, Management Systems International, and
Alcoa. He has consulted with numerous companies on their HR and knowledge
practices. He is the recipient of the International HRM Scholarly Research Award
from the Academy of Management and is currently a faculty fellow at Cambridge
University’s Centre for International Human Resource Management. In addition,
Dr. Morris currently serves on the board of the In ter n a tion a l Jou r n a l of Hu ma n
Resou rces Ma n a gemen t and is a founding editor of the Jou r n a l of Micr ofin a n ce.
He received a BS in psychology and a master’s in organizational behavior from
Brigham Young University, as well as a PhD in human resources management
from Cornell University.
About the Authors
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A Note Regard in g
In clu sion , Equity,
an d Diversity
Cengage Canada has a critical role to play in providing quality, inclusive learning
materials that empower progress. We believe in the power of inclusion, equity,
and diversity to advance the way students learn inside and outside of the classroom. Research demonstrates that students who experience a sense of belonging
in class more successfully make meaning out of, and find relevance in, what they
encounter in learning content. To imp rove both the learning p rocess and outcomes, our materials seek to affirm the fullness of human diversity that students
bring to the classroom, including Indigenous and other racialized group s, and
identities across spectrums of linguistic, age, ability, sexual, and gender diversity.
We also actively strive for equity and inclusivity in content through the solicitation, promotion, recruitment, valuation, and incorporation of different views and
experiences. Our efforts centre on recognizing and reducing implicit biases, being
intentional in our learning design, and including diverse sources of scholarship
and authorship.
Ma n a gin g Hu ma n Resou rces, Tenth Canadian Edition, highlights the power of
human resources professionals to create lasting change in society by promoting
inclusivity and diversity in the workplace. The authors know that inclusion and
diversity are an integral part of every human resource management activity and
have worked diligently to include updated and new content specific to diversity,
gender, Indigenous Peoples, disability, inclusivity training, fair hiring policy, and
pay equity.
We acknowledge that our work around inclusion, equity, and diversity is
ongoing. Please direct any concerns that may contradict the values listed above
to cengagecanada.author@cengage.com and they will be reviewed and addressed.
Alexis Hood
Sr. Por tfolio Ma n a ger, Cen ga ge Ca n a da
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human resources management
(HRM)
The process of managing human talent to
achieve an organization’s objectives
Learning Outcome 1
Explain how human resources managers
and other managers have rewarding careers
through the strategic management of
people.
COVID-19 has changed the world in a dramatic manner. Almost everything has
been seismically impacted, including how we manage people in organizations.
As you will learn later in this chapter and throughout the text, among other
human resource management (HRM) functions, the pandemic has affected how
we recruit, select, train, appraise, and reward employees. While some of these
changes may be temporary, others may become a part of the “new normal.”
The pandemic, in many ways, has brought to the fore the crucial importance of
people in organizations, from frontline employees to CEOs.
We can describe how imp ortant p eop le are to organizations in several
ways. You hear such p hrases as “our p eop le are our most imp ortant assets”
and “without our p eop le, we would be nothing” all the time, but even more
so in our contemp orary COVID-19 world. The terms hu ma n r esou r ces, hu ma n
ca pita l, in tellectu a l a ssets, and ta len t ma n a gemen t imp ly that p eop le drive the
p erformance of their organizations (along with other resources, such as money,
materials, and information). Successful organizations are p articularly adep t at
bringing together different kinds of p eop le to achieve a common p urp ose. This
is the essence of h u m an r esou r ces m an agem en t (HRM). HRM involves a wide
variety of activities, including analyzing a comp any’s comp etitive environment
and designing jobs so that a rm’s strategy can be successfully imp lemented
to beat the comp etition fairly and ethically. This, in turn, requires identifying,
recruiting, and selecting the right p eop le for those jobs; training, motivating, and
ap p raising these p eop le; develop ing comp etitive comp ensation p olicies to attract
and retain them; grooming them to lead the organization in the future, and the
list goes on.
W h y St u d y H u m a n Re s o u r c e s
M anag em ent?
In your career, would you like to
●
work with people to help solve organizational issues?
●
attract top-notch people to come to work with you and your rm?
●
determine the right people to hire so your team and company are a success?
●
help and coach people so they become top performers?
●
make pay and reward decisions that may in uence peoples’ lives?
●
establish the strategic direction your rm should take?
If you answered yes to these questions, a job managing people might be a
rewarding career for you and an excellent reason why you should study HRM.
An article in Ca n a dia n Bu sin ess lists “human resources manager” as one
of the best jobs in Canada for 2019, with a median salary of $94,000 annually.1
Randstad, a multinational consulting rm, lists human resource management jobs
as among the top 15 in Canada in 2021.2
You can pursue many jobs in the HRM eld that offer diverse and rewarding
opportunities. You may want to be an HR generalist to have a more wide-ranging
set of responsibilities, such as those listed above. Otherwise, you can pursue a
more specialized role. Specialized HR roles tend to be found in larger organizations because they have more positions that require speci c and technical skillsets.
The more popular areas of specialization include workforce planning and employment, HR development, total rewards, employee and labour relations, and risk
management.
Workforce planning and employment involves responsibilities such as fullcycle recruitment, promotions, and terminations. HR development covers training
and development responsibilities. The total rewards specialization involves compensation planning, such as crafting job descriptions, conducting performance
evaluations, completing job analyses, and reviewing compensation surveys. Total
2
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rewards also covers jobs that specialize in bene ts, whether it be developing
a bene ts plan, communicating with vendors, administering bene ts plans,
and further bene ts-related tasks. Employee and labour relations are different
in unionized and nonunionized environments. In unionized environments, the
responsibilities may include comprehending and deciphering union contracts,
negotiating collective bargaining agreements, and dealing with employee grievances. In a nonunionized environment, employee relations can vary but may
include fostering employee engagement, employment relations, and employee
disputes. Finally, risk management involves creating and administering health
and safety programs, ensuring health and safety compliance, and other health
and safety-related matters. There are various other HRM roles, such as Human
Resources Information Systems (HRIS) specialists, managing global HR, teaching,
and many more that do not t into these categories. As you can see, a variety of
exciting opportunities exist in the eld of HRM.3
Having a good understanding of HRM is important for managers and entrepreneurs of all types, not just human resources (HR) personnel. All managers are
responsible for at least some of the activities that fall into the category of HRM.
Managers play a key role in selecting, training, motivating, appraising, and promoting employees.
What if you do a poor job of these activities? Believe it or not, many businesspeople with great business strategies, business plans, and products and services
fail because they do not fully grasp the importance of HRM. Laments one entrepreneur: “My rst year after investing in a small business that was failing, I tripled
the amount of business that company did, and made a lot of money. But I didn’t
pay my personnel enough or motivate them. They eventually abandoned me, and
a larger competitor muscled me out of the marketplace. I now understand the
important role personnel play in a business. They can make or break it.”
In addition, great business plans, products, and services can easily be copied
by your competitors. Great personnel cannot. Their knowledge and abilities are
among the most distinctive and renewable resources upon which a company can
draw. As Thomas J. Watson, the founder of IBM, said, “You can get capital and
erect buildings, but it takes people to build a business.”4
Lastly, even if you never become a manager, understanding human resources
management can help you understand your responsibilities and rights as an
employee. For example, what if your employer asks for your passwords to
Facebook or other social media sites? Do you need to provide the manager with
that information? This text can help you answer questions such as these.
H u m a n C a p it a l a n d H RM
Th e idea that organizations “comp ete through p eop le” highlights the fact that
achieving success increasingly dep ends on an organization’s ability to manage
talent, or h u m an cap ital. Th e term hu ma n ca pita l describes the economic
value of emp loyees’ knowledge, skills, and cap abilities. Although the value
of these assets might not show up directly on a comp any’s balance sheet, it
nevertheless has a tremendous imp act on an organization’s p erformance. Th e
following quotations from notable and former chief executive of cers (CEOs)
illustrate this p oint:
●
●
●
human capital
The knowledge, skills, and capabilities of
individuals that have economic value to an
organization
“If you look at our semiconductors and melt them down for silicon, that’s a
tiny fraction of the costs. The rest is intellect and mistakes.” (Gordon Moore,
Intel)
“An organization’s ability to learn, and translate that learning into action
rapidly, is the ultimate competitive business advantage.” ( Jack Welch, General
Electric [GE])
“Human resources isn’t a thing we do. It’s the thing that runs our business.”
(Steve Wynn, Wynn Las Vegas)
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●
●
●
●
●
“You gotta build a team that is so talented, they almost make you uncomfortable.”
(Brian Chesky, AirBnB)
“Successful companies of the twenty- rst century will be those who do the
best jobs of capturing, storing, and leveraging what their employees know.”
(Lew Platt, Hewlett-Packard [HP]) 5
“For years human resources professionals have wanted a seat at the proverbial
table. Now they have that seat in a major way.” ( Johnny C. Taylor Jr., CEO for
the Society Human Resource Management)6
“We believe that one of the most important lessons and reminders for
employers during COVID-19 is that employees are the most valuable assets
for any business. Companies that treat their employees as such and invest
in making their teams feel supported throughout the crisis will thrive in the
long run.” (Andrei Pop, Human API) 7
“We’re in a world now that’s all about people. We’re in a truly human moment
where any connection that doesn’t absolutely lean into people will go
nowhere.” (Bill McDermott, ServiceNow) 8
Human capital is intangible and cannot be managed the way organizations
manage jobs, products, and technologies. One reason why is because employees,
not the organization, own their own human capital. If valued employees leave a
company, they take their human capital with them and any investment the company has made in training and developing these people is lost. However, HRM
practices such as selection and training can develop replacements for these people,
so the real strategic advantage for organizations is a high-quality HRM system.
To build human cap ital in organizations, managers must continue to
develop sup erior knowledge, skills, and exp erience within their workforces and
retain and p romote top p erformers. 9 Beyond the need to invest in emp loyee
develop ment, organizations must nd ways to better use the knowledge of
their workers. Too often emp loyees have knowledge that goes unused. As Dave
Ulrich, a p rofessor of business at the University of Michigan, notes: “Learning
cap ability is g times g—a business’s ability to gen era te new ideas multip lied by
its adep tness at gen era lizin g them throughout the comp any.”10
Although “competing through people” is a major theme of HRM, on a day-to-day
basis, managers of all types must carry out the speci c activities for a company to
effectively do so. Figure 1.1 provides an overall framework of these activities. From
F ig u r e 1.1
Ove rall Fram e w o rk fo r H um an Re so urc e s M anag e m e nt
COMPETITIVE
CHALLENGES
Changes in the
marketplace
and economy
Globalization
Sustainability
Technology
Productivity and
cost challenges
Leveraging employee
differences
4
HUMAN RESOURCES
Planning
Job design
Recruitment
Staffing
Training and
development
Appraisal
Communications
Compensation
Benefits
Labour relations
International HR
EMPLOYEE
CONCERNS AND ISSUES
Job security
Healthcare
Diversity issues
Age, gender, and
generational issues
Retirement issues
Education levels
Employee rights and
privacy
Work attitudes and
employee engagement
Work–life balance
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this gure, we can see that managers have to help blend many aspects of management; at this point, we will simply classify them as either “competitive drivers”
(challenges) or “employee concerns.” We will use Figure 1.1 as a basis for our discussion throughout this chapter.
Check In
Imagine a situation where you must explain the role and importance of good human resources
management to a colleague. What would be some of your key points?
C o m p e t it iv e Is s u e s a n d H u m a n
Re s o u r c e s M a n a g e m e n t
Learning Outcome 2
Professional organizations such as provincial HR associations, consulting organizations, and Human Resource Planning Society (HRSP) conduct ongoing studies
of the most pressing competitive issues facing rms. By seeking the input of chief
executives and HR managers, these organizations keep a nger on the pulse of
major trends. The top trends or competitive issues/ challenges they name today
include those outlined in the sections that follow.
Explain how good human resources
practices can help a rm gain a sustainable
competitive advantage and how COVID-19
may impact this relationship.
Is s u e 1: Re s p o n d in g St r a t e g ic a lly t o C r is is ,
C h a n g e s , a n d D is r u p t io n s in t h e L o c a l a n d
G lo b a l M a r k e t p la c e
Given the pace of commerce, organizations can rarely stand still for long. In
today’s highly competitive environments, in which competition is global and
innovation is continuous, the ability to adapt has become the key to capturing
opportunities and overcoming obstacles, as well as the very survival of organizations. As one pundit put it, “No change means chance.” Successful companies,
says Harvard Business School professor Rosabeth Moss Kanter, develop a culture
that just keeps moving all the time.11
Consider what happened to every organization, to some extent, since
COVID-19 shattered lives globally. Some will be closed, such as small businesses,
maybe forever; others, such as home delivery services and pharmaceuticals, may
be doing better because of the demand of their products. All these changes mean
signi cant HR changes and challenges.
COVID- 19 and H RM
COVID-19 has resulted in one of the most extreme organizational transformations in the past century. Amidst the pandemic, HR professionals have played and
continue to play a lead role in assisting organizations to brainstorm, evaluate, and
signi cantly revise their organization’s people strategy while attempting to continue to operate ef ciently. However, the workplace issues caused by COVID-19
are unprecedented.12 As many as 61 percent of Canadian HR professionals have
af rmed that their responsibilities have become signi cantly more complex.13
The main challenges reported by HR leaders during the pandemic include creating business continuity plans (67 percent), administrating exible work arrangements (64 percent), handling employee communication (56 percent), supporting
employees with issues pertaining to workplace policies (53 percent), execution
of preventive measures (43 percent), and revisiting preexisting welfare policies
(25 percent).14
As we will discuss throughout the text, many HR responsibilities have either
changed, increased in importance, or have been added since the COVID-19
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outbreak began. Strategic planning has become even more crucial during the
pandemic. Organizations are increasingly required to be agile and ef cient in
adapting their business plan for the future of work. HR is more frequently brought
into management meetings to discuss how to best navigate this new landscape.15
HR has a role in establishing alignment and ensuring organization-wide communication about the precautions being taken, of ce updates, and organizational
changes.16 In many organizations, HR spearheads the of ce re-entry planning to
ensure safe and effective protocols with an assurance of of ce sanitation. There
are many liability concerns surrounding of ce reopening plans, so this continues
to be a crucial role for HR.17
HRM professionals have also been required to rewrite company policies and
quickly adjust business plans. The employee handbook requires revisiting to
account for new rules and practices that coincide with government mandates or
in anticipation of future issues. Typically, a few policies are edited annually. Now,
HR has quickly become responsible for adjusting policies frequently with the
pandemic.18 In addition, HR’s role in compensation planning has become more
crucial and challenging amidst COVID-19. Not only have salaries and bonuses
been affected, but HR must also tackle a multitude of new compensation needs,
including unemployment, work-sharing programs, commission-based positions,
and other concerns.19
Organizations are also now embracing the imp ortance of culture and HR’s
role in enhancing connectedness and engagement. COVID-19 has highlighted
the ardent need for a feeling of community and common objectives. HR must
establish cohesion between emp loyees and leaders as leaders learn how to
manage, motivate, and engage remote emp loyees amidst uncertainty.20 In sup p orting the organizational culture, HR also has an increasingly more crucial
role in sup p orting emp loyee mental health. Amidst the pandemic, there has
been a signi cant rise in mental health issues, and HR may be involved in mass
terminations, which will affect emp loyees remaining in the organization. HR
must maintain the morale of the remaining emp loyees. They may also establish
new emp loyee assistance p lans and p rograms and mindfulness, exercise, and
nancial training p rograms.21
Finally, there has been a shift in talent requirements due to COVID-19, and HR
has had to amend its talent strategy. While some departments, positions, or skillsets
within the organization may no longer be as relevant, others may be increasingly
Luis Alvarez/ DigitalVision/ Getty Images
COVID-19 has placed new restrictions
at work.
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more critical and in demand. HR must rearrange the workforce, develop employees
to possess newly required skills, and work on integrating gig-economy employees.
Diversity and inclusion should also be considered, given that COVID-19 has inordinately impacted diverse groups. HR now plays an even more signi cant role in
creating an equitable workplace to ensure equal access to opportunities.22
H R M anag e rs and B usine ss Strate g ie s
In decades past, HR departments were often focused on performing administrative
tasks, dealing with unions, and complying with labour laws. But HR management is
vastly different today. Astute executives know that HR professionals can help them
improve, comply with the law, and aid the bottom line by streamlining employment costs. HR professionals can improve the top line by redesigning work to
foster innovation, forecasting labour trends, recruiting and motivating employees,
and measuring their effectiveness. HR managers also help their rms with business strategies, mergers and acquisitions, and ways to enter new and global markets. “If you look at the evolution going back to when we called HR ‘personnel,’ it’s
come a long way as a function,” says Art Mazor, with Deloitte Consulting. New HR
tools and technologies are allowing the HR functions to look outside the tactical,
administrative reporting and data gathering to bring insights and to drive business
strategy and results, Mazor says.23
HR managers need an intimate understanding of their rms’ competitive business operations and strategies, whatever they may be. During what has been called
the “Great Recession,” which began in 2008, many companies pursued cost-cutting
strategies, often in part by trimming workers’ bene ts. Other companies took a different strategy: they improved their bene t programs to attract top talent from other
companies and expanded to be ready when the economy began growing again.
Reengineering, downsizing, and outsourcing are also examples of the means
organizations use to modify the way they operate to be more successful. Six Sigm a
is a set of principles and practices whose core ideas include understanding customer
needs, doing things right the rst time, and striving for continuous improvement
(see Reality Check).
Reen gin eer in g has been described as “the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in cost,
quality, service, and speed.”24 Dow n sizin g is the planned elimination of jobs
and ou tsou r cin g simply means hiring someone outside the company to perform
business processes that were previously done within the rm.
A common denominator of these strategies is that they require companies
to engage in change management. Ch an ge m an agem en t is a systematic way
of bringing about and managing both organizational changes and changes on
the individual level. According to a survey by the research institute Roffey Park,
two-thirds of rms believe that managing change is their biggest challenge.
Although most employees understand that change is continuous—responsibilities,
job assignments, and work processes change—people often resist it because it
requires them to modify or abandon ways of working that have been successful
or at least familiar to them. Successful change rarely occurs naturally or easily.
To manage change executives and managers—including those in HR—must
envision the future, communicate this vision to employees, set clear expectations
for performance, and develop the capability to execute by reorganizing people and
reallocating assets. Organizations that have been successful in engineering change
●
link the change to the business strategy;
●
show how the change creates quanti able bene ts;
●
●
Six Sigma
Aset of principles and practices whose
core ideas include understanding customer
needs, doing things right the rst time, and
striving for continuous improvement
reengineering
The fundamental rethinking and radical
redesign of business processes to achieve
dramatic improvements in cost, quality,
service, and speed
downsizing
Planned elimination of jobs
outsourcing
Contracting out work that was formerly done
by employees
change management
Change management is a systematic
way of bringing about and managing both
organizational changes and changes on the
individual level
engage key employees, customers, and their suppliers early when making a
change; and
make an investment in implementing and sustaining change.25
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TRMK/ Shutterstock.com
Many Canadian companies use
business process reengineering to
improve productivity at their plants.
reactive changes
Changes that occur after external forces
have already affected performance
proactive change
Change initiated to take advantage of
targeted opportunities
globalization
The trend to opening up foreign markets to
international trade and investment
Some of the strategic changes companies pursue are r eactive ch an ges that
result when external forces, such as the competition, a recession, a law change, or
an ethical crisis (e.g., the backlash Volkswagen experienced in 2016 for cheating
on its vehicles’ emissions tests), have already affected an organization’s performance. Other strategies are p r oactive ch an ge, initiated by managers to take
advantage of targeted opportunities, particularly in fast-changing industries in
which followers are not successful.
Good HR managers know that they can be key players when it comes to
driving the business strategies of their organizations to make changes. That is
why forward-looking CEOs such as Gregg Saretsky at WestJet, Howard Schultz at
Starbucks, and Jeff Immelt at GE make certain that their top HR executives report
directly to them and help them address key issues.
Companies are increasingly rotating non-HR managers in to HR positions, and
vice versa, to give them exposure to different areas of the organization. Rather than
emphasizing the administrative aspects of HR, forward-thinking companies develop
and promote their HR personnel and provide them with key business statistics and
numbers they can use to measure the effectiveness of the workforce. We will discuss more about competitive HR strategies and HR in Chapter 2. Meanwhile, keep
in mind that HR’s role is not all about providing advice to CEOs and supervisors.
In addition to serving as strategic partners to management, HR managers are also
responsible for listening to and advocating on behalf of employees to make sure
their interests are aligned with those of the rm, and that their rights are respected.
A good deal of evidence suggests that this is one of the toughest parts of an HR
manager’s job. We will discuss more about this aspect of the job later in the chapter.
Co m p e ting , Re c ruiting , and Staf ng Glo b ally
Th e strategies comp anies are p ursing today increasingly involve one or more
elements of glo b alizatio n . Th e integration of world economies and markets
has sent businesses abroad to look for op p ortunities and fend off foreign comp etitors domestically. Consumers around the world want to be able to buy
“anything, anytime, anywhere,” and comp anies are making it p ossible for them
to do so. Want to buy a Coke in Pakistan? No p roblem. Coca-Cola has an elaborate delivery system designed to transp ort its p roducts to some of the most
remote p laces on the p lanet. In fact, the comp any has long generated more of
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its revenues abroad than it does in the United States. But globalization is not of
interest only to large rms such as Coca-Cola. Although estimates vary widely,
ap p roximately 70 to 85 p ercent of the Canadian economy today is affected by
international comp etition, including small comp anies.
China could surpass the United States to become the largest economy in the
world by 2041, and India could be the third largest. These countries can produce goods and provide services at a fraction of the cost of Canadian workers.
As the vice president and chief economist of the Conference Board of Canada
stated, “There are billions of people in Asia who want to get to where we are,
and they’re prepared to work longer and harder. So we have to work smarter.”26
The manufacturing industry in Canada illustrates a good example of the impact
of globalization. For multiple generations, industrial plants were at the centre of
the communities in which they resided. However, Canadian factory closures have
become commonplace in tandem with a universal economic restructuring. Since
2001, Canada has lost 498,000 manufacturing jobs, of which Ontario was most
affected. Although Ontario’s population has increased by 22 percent since 2001,
the manufacturing labour force decreased by 28 percent overall. A main contributor
to the decline is globalization. Brant County, in Ontario, remains largely focused
on car manufacturing and has proclaimed that: “It is also becoming increasingly
dif cult to compete with lower-cost plants in parts of the U.S. and Mexico. Lower
labour costs and new investments in automation in the newer plants contribute to
this, as well as the relative value of the Canadian dollar against the U.S. currency.”27
Partnerships and mergers are two other ways companies both large and
small are globalizing. Coca-Cola has tried to expand in China by partnering with
that nation’s largest juice maker.
As a result of globalization, the national identities of products are blurring,
too. BMW has traditionally been a German brand, but now the automaker builds
cars in the United States, China, and elsewhere. Likewise, you probably think of
Budweiser as an American beer, but would it surprise you to know that the maker
of Budweiser (Anheuser-Busch) is owned by a Belgian company called InBev?
Amidst COVID-19, Anheuser-Busch InBev, like many other companies, was hit
globally by heavily declining sales. Experts believe the company will rely on its
Asia-Paci c segment to redeem itself. In the post-COVID-19 world, it is believed
that there will be a rise in revenue of $5.2 billion in 2021. Of this revenue increase,
$1 billion is expected to be attributed to the Asia-Paci c market.28
Numerous free-trade agreements forged among nations in the last half-century
have helped quicken the pace of globalization. The rst major trade agreement
of the twentieth century was made in 1948, following World War II. Called the
General Agreement on Tariffs and Trade (GATT), it established rules and guidelines for global commerce among nations and groups of nations. Although the
Great Recession temporarily caused a sharp drop in the amount of world trade,
since GATT began world trade has exploded, increasing nearly 30 times the dollar
volume of what it once was. This is three times faster than the world’s overall output
has grown during the same period. GATT paved the way for the formation of many
major trade agreements and institutions, including the European Union (EU) in
1986 and the North American Free Trade Agreement (NAFTA) in 1994, renegotiated
in 2018 as the United States–Mexico–Canada (USMCA) Agreement, encompassing
the United States, Canada, and Mexico. The World Trade Organization (WTO),
headquartered in Lausanne, Switzerland, now has more than 153-member countries, and new free-trade agreements seem to be forged annually.
Free trade has, however, come under the microscope in many countries
and has experienced some roll-back, as political leaders try to protect the businesses and jobs in their countries. The United Kingdom voted to leave (“Brexit”)
the European Union in 2016 (at the time of revising this book, the UK was
still in consultations with the European Union on the terms of the exit). In the
United States, the Donald Trump administration was critical of free-trade agreements, including NAFTA and a new trade agreement (USMCA) among the three
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North American countries came into effect in 2020. It is unclear (at the time of
writing this textbook), whether the new US government would engage in further talks with Canada and Mexico on this agreement. Nonetheless, even the
most vocal opponents of global trade are anxious to complete new free-trade
deals with such countries as India to increase business opportunities for rms.29
Although they have come under re from people and politicians around the
world, new free-trade agreements continue to be forged.
H o w Glo b alizatio n Affe c ts H RM
For all the opportunities afforded by international business, when managers talk
about “going global,” they have to balance a complicated set of issues related to
different geographies, including different cultures, employment laws, and business
practices. HR issues underlie each of these concerns. They include such things as
dealing with employees today who, via the Internet, are better informed about
global job opportunities and are willing to pursue them, even if it means working
for competing companies. Gauging the knowledge and skill base of international
workers and guring out how best to hire and train them, sometimes with materials that must be translated into a number of different languages, are also issues
for rms. Relocating managers and other workers to direct the efforts of an international workforce is a challenge as well. HR personnel are frequently responsible for implementing training programs and enhancing their rms’ managers’
understanding of other cultures and practices, as well as dealing with the culture
shock these workers might experience and pay differentials that must be adjusted,
depending on the country. The international arena for HRM has become so crucial
and so involved that we have devoted an entire chapter (Chapter 15) to discussing
its competitive, cultural, and practical implications.
Is s u e 2 : Se t t in g a n d A c h ie v in g C o r p o r a t e So c ia l
Re s p o n s ib ilit y a n d Su s t a in a b ilit y G o a ls
Globalization has led to an improvement in people’s living standards in the last
half-century. As a result of free trade, Canadians are able to buy products made
abroad more cheaply. Conversely, people in low-wage countries that make those
goods and services are becoming wealthier and are beginning to buy North
American-made products. Nonetheless, globalization stirs erce debate—especially
when it comes to jobs. Since the turn of the century, thousands of Canadian jobs,
both white and blue collar, have been exported to low-wage nations all around
the world. Some people worry that free trade is creating a “have/ have not” world
economy, in which the people in developing economies and the world’s environment are being exploited by companies in richer, more developed countries. This
has sparked anti-free-trade protests in many nations.
Concerns such as these, coupled with corporate scandals over the years,
including the use of sweatshop labour in third-world countries, risky lending
tactics that fuelled a worldwide banking crisis, and a class action lawsuit alleging
that Walmart discriminated against hundreds of thousands of female employees
over the years, have led to a new focus on cor p or ate social r esp on sib ility,
or good citizenship. In a recent survey, Chr on icle of Phila n thr opy found that
16 percent of companies were making more donations of products and services
and that 54 percent of companies were encouraging more employees to volunteer their time.30 Companies are learning (sometimes the hard way) that being
socially responsible both domestically and abroad can not only help them avoid
lawsuits but also improve their earnings. For example, researchers at the Boston
College’s Center for Corporate Citizenship found that as a company’s reputation
improved, so did the percentage increase in the number of people who would
recommend that rm. Nearly two-thirds of the members of the 80 million-strong
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corporate social responsibility
The responsibility of the rm to act in
the best interests of the people and
communities affected by its activities
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sustainability
Doing business in a way that does as little
harm to the environment and depletes as
few natural resources as possible
collaborative software
Software that allows workers to interface
and share information with one another
electronically
millennial generation (people born in the 1980s and 1990s) consider a company’s
social reputation when deciding where to shop, and 90 percent say they would
switch brands based on their perceptions of a company’s commitment to social
responsibility.31 Moreover, prospective workers are saying that corporate responsibility is now more important to their job selection.
Su stain ab ility is closely related to corporate social responsibility. It refers
to a company’s ability to produce a good or service without damaging the environment or depleting a resource. Achieving complete sustainability is nearly
impossible, but companies are making strides to reduce their “carbon footprints.”
Those that are not are nding themselves under pressure from consumers and
groups determined that they do. Consider what happened to HP. After HP broke
a promise to eliminate toxic materials in its computers by 2009, Greenpeace
activists painted the words “Hazardous Products” on the roof of the company’s
headquarters in Palo Alto, California. Meanwhile, a voice-mail message from Sta r
Trek actor William Shatner was delivered to all of the phones in the building.
“Please ask your leader [CEO Mark Hurd] to make computers that are toxin free
like Apple has done,” Shatner said in the recording. The stunt and publicity it
generated worked. HP got the message and later delivered on its promise.32
One of HR’s leadership roles is to spearhead the development and implementation of corporate citizenship throughout their organizations, including good
environmental management.33 Green Human Resource Management (GHRM) is
a rapidly growing phenomenon and refers to the uni cation of environmental
management and HRM. By adopting formal environmental HRM policies and
sustainable business practices, GHRM plays an integral role in an organization’s
sustainability strategies and contributes to its environmental objectives. These
policies and practices can be incorporated into all facets of HRM, such as recruitment, training and development, performance management, employee relations,
and compensation. Individuals are hired, trained, asked to participate in activities, rated on their performance, and rewarded and compensated based on green
initiatives. GHRM covers environmental concerns and supports the social and
economic prosperity of both the organization and its employees. The bene ts of
GHRM are increased retention, increased job satisfaction and engagement, and
increased ability to attract new talent.34
Check In
Think of a rm that is facing dramatic challenges to survive the COVID-19 crisis. How do you think
the rm’s personnel can help it adapt? What role will the company’s human resources staff play
in helping with that goal?
Is s u e 3 : A d v a n c in g H RM w it h Te c h n o lo g y
Describe how technology can improve how
people perform their work and how they are
managed.
Advancements in information technology have enabled organizations to take
advantage of the information exp losion. Comp uter networks and “cloud comp uting” (Internet comp uter services and data storage) have made it p ossible for
nearly unlimited amounts of data to be stored, retrieved, and used in a wide
variety of ways. Collab or ative softw ar e that allows workers anywhere, anytime to interface and share information with one another electronically—wikis,
document-sharing p latforms such as Google Docs, online chat and instant messaging, Web and videoconferencing, and electronic calendar systems—have
changed how and where p eop le and comp anies do business. For examp le,
Boeing Satellite Systems has a “lessons learned” site on its intranet where p eop le
from all areas of the comp any can store the knowledge they have and others can
access it. Executives at Boeing estimate that the measure has reduced the cost of
develop ing a satellite by as much as $25 million.35
The Internet and social media are also having an impact on HRM. Social media
networking has become the new way to attract employees and check them out to
see if they are acceptable candidates. Companies are hiring rms such as Social
12
Learning Outcome 3
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Intelligence, which combs through Facebook, LinkedIn, Twitter, Flickr, YouTube,
and “thousands of other sources” to create reports about the “real you”—not the
“you” you have presented in your résumé.36 (Care to change your Facebook page,
anyone?) Social media has become a power tool for organizations, providing them
with an array of positive options. Social media can be used for external purposes
to attract the right employees and gather information about them, build the company’s brand, and give a face to a company. Internally, key social media leaders
by default become more engaged and connected to the organization’s culture,
mission/ vision, and overall goals. Organizations can also use social media to
manage talents, address mobility issues, and allow for greater collaboration with
employees and suppliers. This technology can also be used to build work teams
that are diverse in nature given the exibility that social media brings to the table.37
HR managers are also grappling with whether or not to develop blogging and
social media policies and whether or not to establish rules about the amount of time
employees can spend online or to install software that cuts them off after a certain
amount of time. These are important considerations for HR managers because organizations must be mindful to manage the risks associated with social media.
Kno w le d g e W o rke rs, Virtual Le arning , Auto m atio n, and
Arti c ial Inte llig e nc e
Advanced technology tends to reduce the number of jobs that require little skill
and to increase the number of jobs that require considerable skill. In general, this
transformation has been referred to as a shift from “touch labour” to k n ow led ge
wor k er s, in which employee responsibilities expand to include a richer array of
activities, such as planning, decision making, and problem solving.38
The workplace of the knowledge worker amid the COVID-19 pandemic is
described in Highlights in HRM 1.1. Technology, transportation, communications,
and utilities industries tend to spend the most on training. Knowledge-based
training has become so important that Manpower, the largest employment agency
in the United States, offers free information technology training through its online
university. The site features thousands of hours of instruction in technology applications, along with professional development, business skills, and telecommunications
courses, seminars, and chat rooms with mentors. “Just-in-time” learning is delivered
via the Internet to Manpower employees’ mobile phones, tablets, and computers.
Virtual learning is increasing as well. Video conferencing platforms such as
Zoom, Webex, Teams, and Hangouts have led to a workplace and HRM digital
transformation. Before COVID-19, many suggested that these platforms were the
way of the future and would change the employee experience. However, COVID-19
broke down barriers and expedited a process that would have otherwise taken
many more years. Training can now be conducted virtually and more ef ciently.
Many software features can enhance the experience, including audience chat tools
and polls, private chats, transcription capabilities, and the blackboard function.
Further, if employees cannot attend in real-time, they can listen to the recorded
session at a time that suits them.39 Research from senior executives worldwide has
shown that web conferencing has increased employee cohesiveness and collaboration towards a common objective, increased agility, broken down organizational
silos, improved time management, and increased innovation.40
Automation is affecting not only blue-collar and routine jobs, but others as
well. News organizations are using web robots (“bots”) to gather information
and write basic stories about corporate earnings and sports recaps. Many of the
entries on Wikipedia aren’t written by people but by bots that comb the Web for
information and compile the information you see on the site. Or consider the
IBM robot, Jill Watson. In 2016, a university used Jill as an online teaching assistant in an experiment with an arti cial intelligence class. Most students never
gured out Jill wasn’t human—although some of them said they were suspicious
she was because she seemed to answer their questions way too fast!41
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knowledge workers
Workers whose responsibilities extend
beyond the physical execution of work to
include planning, decision making, and
problem solving
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Highlights in HRM 1.1
The Future o f W o rk
The world of work has been undergoing rapid change, and all
indications are that this trend will continue well into the future.
Many changes have occurred at an expedited pace due to the
global COVID-19 pandemic. According to a variety of experts,
the workplace of the post-pandemic world and beyond will look
like this:
●
●
●
●
●
●
●
suburban areas, so employees may choose to
work a few days a week in a shared space close
to home.
●
●
Education will be lifelong; jobs won’t be.
Temporary, freelance work and other forms of nonstandard
employment will become increasingly popular as
organizations employ fewer permanent workers.
The new normal will likely entail three days in the of ce
and two days working from home.
Companies will spend a signi cant amount on health,
hygiene, and safety and will hire more health and safety
roles to mitigate the potential of future pandemics.
Workplaces will use “hoteling,” in which employees
will not have designated seats but will choose to sit
where there is available space or based on a speci c
task. There will be more focus on common spaces and
collaboration.
Offices will be more dispersed, and new work areas
will appear, thus saving people time and money
compared to their original commute to a central
business district.
Some organizations that currently have their offices
in a central business district will have satellite offices in
●
●
●
●
●
The number of remote workers will almost double within
ve years.
Meetings will likely be 38 percent completely remote,
33 percent completely in person, and 29 percent a
combination of remote and in-person attendees.
Virtual and augmented reality will become exceedingly
popular as fewer employees work in the same location.
By 2030, technology and Arti cial Intelligence (AI) will create
more revenue for their organization than human employees
and occupy a larger portion of its annual operating costs.
By 2035, AI will likely have the ability to make most
business decisions, which will reduce the requirement for
the conventional senior management team.
The increase in remote work will attract diverse global
talent and provide more prosperous job opportunities for
individuals in developing countries.
Human skills will become increasingly important in order
to separate human ability from powerful algorithms and
technological capabilities.
For an interesting take on the “future of work” in Canada,
watch the video The Future of Work by Policy Horizons at
this Government of Canada site (http://horizons.gc.ca/en
/2019/09/06/horizons-talks-the-future-of-work).
Sources: Adapted from John Stackhouse, “There’s a Future for Jobs—We Are Just Not Ready for It,” The Globe and Mail (March 26, 2016), https://www
.theglobeandmail.com/business/commentary/article-there-is-a-future-for-jobs-were-just-not-ready-for-it/, retrieved April 5, 2018; Theresa Agovino, “What Will the
Workplace Look Like in 2025?” SHRM (December 12, 2020), https://www.shrm.org/hr-today/news/all-things-work/pages/the-workplace-in-2025.aspx; Dror Poleg,
“The Future of Of ces When Workers Have a Choice,” Chicago Tribune (January 9, 2021); Charles Towers-Clark, “Human Skills Will be Most Important in the Digital
Future of Work,” Forbes (December 10, 2020); Jo Meunier, “Future of Work: Hybrid Meetings Will Bring Balance to the Workplace,” All Work (January, 8, 2021),
https://allwork.space/2021/01/future-of-work-hybrid-meetings-will-bring-balance-to-the-workplace; “Life in 2025: What Will the Future Look Like?” Financial
Times (December 15, 2020); Adam Ozimek, “Economist Report: Future Workforce,” retrieved January 9, 2021, https://www.upwork.com/press/releases
/economist-report-future-workforce; Jim Wilson, “What Will Work Look Like in 2035?” Canadian HRReporter, https://www.hrreporter.com/focus-areas
/automation-ai/what-will-work-look-like-in-2035/334451.
Automation plays a major part in the gig economy. AI contributes to the
growing use of gig work as digital jobs become increasingly popular.42 Though
AI is seemingly a productive tool for organizations that use AI to maximize pro t
margins, there may be negative implications for those who work gig jobs. For
example, AI’s algorithmic systems have had effects on compensation. AI gathers
information to determine how an organization can save money, which may result
in decreases to workers’ wages and makes it hard for workers to predict their
income or schedule. The platforms often make abrupt changes to increase an
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organization’s revenues. The AI Now 2019 Report claimed, “these platforms treat
workers as subjects of constant experimentation, often in ways that destabilize
their economic and even psychological security.”43 When organizations exceedingly place their trust on AI to make signi cant business decisions, they may
depersonalize their management systems.44
On gig work platforms such as Uber and Lyft, algorithms are essential to
allocate, monitor, and reward gig work. Now, workers blame algorithms on the
unexplained eradication of jobs or decreasing income levels.45 Unsure of the
reason for the decrease in jobs offered to them, to “win” more jobs, drivers
often attempt to use strategies such as accepting jobs as quickly as possible and
waiting in certain spots that seem to provide them more jobs. In turn, they lose
the exibility promised to them for pursuing such an opportunity. Labour scholar
Jim Stanford stated, “the only thing truly new about gig employment is its use of
digital and online techniques to assign work, discipline workers . . . and control
the money. That’s more effective than the bulletin boards and classi ed ads of
yesteryear—but it hardly negates the inherent power imbalance between an individual worker and the multibillion-dollar company they work for.”
In ue nc e o f Te c hno lo g y o n H RM
Perhaps the most central use of technology in HRM is an organization’s h u m an
resou rces in for m ation system (HRIS). Because HR affects the entire workforce—
everyone who works for the company must be hired, trained, paid, and promoted,
usually through HR—the impact of the HRIS has been dramatic. It has become a
potent weapon for lowering administrative costs, increasing productivity, speeding
up response times, improving decision making, and tracking a company’s talent.
The most obvious impact has been operational—that is, automating routine activities, alleviating administrative burdens, reducing costs, and improving
productivity internal to the HR function itself. The most frequent uses include
automating payroll processing, maintaining employee records, and administering
bene ts programs. “Self-service”—setting up systems, usually on an intranet—
allows managers to access employee records themselves for administrative purposes and to access and change their own bene ts and other personal information.
Th e second way in which information technology is affecting HRM is relational in nature—connecting p eop le with one another and with the HR data
they need. For examp le, comp anies are using software to recruit, screen, and
p retest ap p licants online before hiring them, as well as to train, track, and p romote emp loyees once they have been hired. As another examp le of HRIS cap abilities, Humaans is a startup comp any that has created an HRIS system that
sup p orts human resources in onboarding, managing, and growing emp loyees.
“It is designed for sp eed, and features a beautiful p eop le directory, document
storage, time-off tracking, visual rep orting, and connects existing systems
through deep integrations,” exp lained Giovanni Lup erti, one of the comp any’s
founders. 46
The third effect of the HRIS is transformational in nature—changing the way
HR processes are designed and executed. Corning, Inc. uses HR software, among
other things, to set the developmental goals of its employees once they have been
hired and to gauge how well they are meeting them. Employees can look online
to see their own goals and mark their progress as well as see everyone else’s
goals in the command chain, from the CEO down to their immediate supervisors.
This “cascading” of goals has helped Corning’s employees align their personal
goals with the organization’s overall objectives to reach higher levels. “Like any
large company, we tended to get ‘silo-ed’ and fragmented the more we grew,” said
one vice president at a company using a system similar to Corning’s. “We needed
a better way to pull our global team together and get people focused on what the
priorities are for our business.”47
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human resources information
system (HRIS)
Acomputerized system that provides
current and accurate data for purposes of
control and decision making
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workforce (HR) analytics
The process of gathering and analyzing
data to improve a rm’s human resources
management
16
One of the newer HRIS applications is the use of big data. Traditionally, big
data is described as the massive amounts of data that are too large for conventional database tools or statistical software to collect, save, manage, and examine.
However, more recent research has extended the de nition to entail not just large
amounts of data, but also the “smartness” of the data, which essentially describes
the degree to which longitudinal data can be used for detailed analyses to interpret and forecast behaviour and outcomes.48 Marketing departments have very
successfully used big data to detect peoples’ buying patterns. By analyzing its customers’ buying habits, Target was able to predict which of them were pregnant,
sometimes before they had even told their families. The company then sent the
customers ads and coupons for baby products.
Now companies are doing the same thing to analyze HR information, a process that’s referred to as wor k for ce (HR) an alytics. HR information such as
employment history, skills, education, demographics, hours worked, compensation, performance, training, and disciplinary actions can be collected with “bigger
data” such as email content, social network communication, web searches, video
surveillance, and GPS information from smartphones, and stored in one system.
Though this data collection may raise privacy concerns, there is still much to be
learned from this information to advance the HR eld.49
Big data is useful for recruitment and selection. Big data can help p rep op ulate demograp hic questions and factual rather than self-rep orted
exp eriences and activities such as p rofessional membership s and associations.
It could also conduct automated reference checks and use information from
social network p ro les to screen ap p lications. Findings have concurred that
p ersonality assessments based on p redictive analytics from social network
p ro les are similar to self-rep orts and help determine undergraduate students’
future work p erformance ratings.
Recruitment and selection will bene t from big data in a variety of other
ways in the near future. One area that will likely be pursued, and which LinkedIn
is already working on rolling out, uses big data for targeted recruitment strategies and guring out the organizations that may attract the applicant away from
their current jobs. This information will help organizations secure candidates
and determine how to retain those who could leave the organization. Further, an
American national database, Occupational Information Network (O*NET), uses
big data to collect information from job postings. ONET’s information could soon
help determine the evolution of jobs and trends and the optimal individual characteristics to face the continually evolving workplace.50
HR can also use big data for a variety of other reasons. In terms of p erformance ap p raisal and management, organizations can track smartp hones,
comp uters, or tablets to assess real-time p erformance. It can also evaluate and
p redict how leadership behaviours and emp loyee attitudes can ensure higher
organizational p erformance 51 and which leadership attributes will foster higher
retention. Big data can also be useful for training and develop ment. For examp le,
it can determine which training designs and training content p roduce training
outcomes dep ending on the individual. Predictive analytics and data mining
can exp lore the context and p ersonal attributes that will p redict success in a
training p rogram.
HR can use big data to assess organizational climate and culture. One method
of doing so is by analyzing electronic interactions and social networks. As an
example of such a system, researchers from MIT created a web application called
Immersion, which studies emails to understand an individual’s social network. It
reviews emails sent “to” and “from,” as well as those who are “cc’ed.” Rather than
the email content, the program studies connections and communication lines.
Thus, Immersion identi es both the links and the strength of relationships. This
nding can also help support diversity and inclusion efforts. Big data will continue to evolve and be evaluated to determine how it can add value for HR to be
a better management decision tool.52
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Using HR data, a rm can de nitely answer questions like the following:
●
●
Do employees with a degree perform better—or not—versus those without
a degree?
Exactly how much more do top performers need to be paid to stay with our
rm?
●
Which job applicants are likely to perform better?
●
Which employees are most likely to quit?
Traditionally, questions such as these have been answered based on anecdotal
evidence or the “gut” feelings of HR professionals. But workforce analytics can
provide more de nitive answers. For example, companies such as Capital One,
IBM, Oracle, and SAS are using data mining for candidate selection and retention.
By using data analytics, the companies can nd relationships between factors,
including previous work experience, companies in which candidates have worked,
and the schools they attended. The companies also use this data to forecast which
employees have the greatest likelihood of leaving the company. From these ndings, the company can select such candidates for retention initiatives.53 Gathering
and analyzing HR data may sound like a daunting task, but HR software providers
are including data analysis tools in their programs that make it easier to gather and
visualize HR data in a meaningful way.
What sort of system should HR professionals choose among the many options
available to them? Prepackaged, or “canned,” HR Web-based solutions are as
commonly used as custom-designed systems. Generally, companies also have
the choice of hosting the applications on their own servers or having software
vendors such as IBM or PeopleSoft do it for them. Experts say the rst step in
choosing an HRIS is for HR personnel to evaluate the biggest “headaches” they
experience, or the most time-consuming tasks, and then choose the applications
that can have the strongest impact on the rm’s nancial measures—that is, the
ones that get the “biggest bang for the buck.” These applications are more likely
to get “buy-in” from the rm’s top managers. HR managers should then calculate
the costs based on average salaries, or HR hours, that could be saved by using an
HRIS, along with the hours of increased productivity that would occur as a result.
Highlights in HRM 1.2 shows the other factors that need to be evaluated.
When an effective HRIS is implemented, perhaps the biggest advantage
gained is that HR personnel can concentrate more effectively on the rm’s strategic direction instead of on routine tasks. This can include forecasting personnel
needs (especially for rms planning to expand, contract, or merge), planning
for career and employee promotions, and evaluating the impact of the rm’s
policies—those related to both HR and other functions—to help improve the
rm’s earnings and strategic direction.
Although the initial drive to adopt HRISs was related to cutting HR costs,
HR managers have since discovered that the systems have allowed them to share
information with departmental managers, who, by having access to it, have been
able to come up with better production practices and cost control solutions. As
a result, HR managers are now requiring their application providers to provide
them with software to meet certain goals, including lowering a company’s total
spending on employee healthcare and improving its customer service.54
However, comp anies simp ly cannot turn over their strategic talent issues
to an HRIS. Researchers found that desp ite such systems—electronic or
otherwise—43 p ercent of CEOs, CFOs, and human resources directors, felt that
p oor human cap ital management hindered their organizations from achieving
nancial targets, and 40 p ercent said that p oor talent management inhibited
the organization’s innovation. Inadequate talent management was also to blame
for the failure to exp and into different markets, nish crucial p rojects, p redict
growth, and remain comp etitive. Only 12 p ercent of CEOs felt satis ed with the
quality of the metrics on human cap ital they would receive, and 38 p ercent of
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Highlights in HRM 1.2
Fac to rs to Co nsid er W hen Evaluating a H um an Reso urc es Info rm atio n System
The following factors are key considerations for HRmanagers
when their rms are evaluating a human resources information
system (HRIS):
●
●
●
●
●
●
●
●
Fit of the application to HR’s needs and the rm’s strategic
plans. Is the rm in an aggressive growth period or
condensing operations? What is the size and breadth
of responsibilities of the HR department? What are the
needed versus the desired features of an HRIS system?
Fit of the application to the rm’s employee base. If many
of the rm’s employees work on a factory oor, is the
system appropriate, or does HR need to install kiosks in
employee areas? Will employees be able to access the
HRIS offsite on the Internet or on their mobile phones? How
will the information be secured? Will employees need to be
assigned passwords?
Ability to upgrade or customize the software. What sorts
of costs will be involved to upgrade the software in the
coming years?
Compatibility with current systems. Does the HRIS link
into existing, or planned, information systems easily and
inexpensively?
User friendliness. Does the software provide additional
features such as links to learning resources or help for
managers who might need it?
●
●
●
●
●
●
●
Collaboration. Does the system connect employees and
allow them to collaborate on solutions to problems and
projects?
Employee management. Does the system allow HR to track
employee records easily? Does the system track employee
performance, document feedback from performance
reviews, and maintain information about compensation and
disciplinary history?
Training and development. Does the system allow the
user to design a training path for employees and integrate
training courses, tests, and professional certi cation
preparation? Can the system use work performance
to assess whether the training has helped employees
improve?
●
●
●
Survey capabilities. Does the system have an app that
allows employees to be surveyed electronically?
Recruiting and applicant tracking and onboarding. Does the
system make it easy to nd, recruit, and track applicants
and a company’s current employees for hiring purposes?
Does the system have the capability of guiding new
employees through onboarding training modules?
Bene ts administration and tracking. Does the system
make it easy for employees to keep track of their enrolled
bene ts, manage their healthcare plans, and make
adjustments when needed?
Payroll and scheduling. Can the system track employee’s
time and attendance? If the rm has hourly employees,
can employees use the system to clock in and out? Can
employees use the system to request paid time off and
track their paycheques?
Customizable reports. Can the system create meaningful
reports that outline information ranging from standard
reports to AI-powered predictive analytics?
Scheduling. Does the system have scheduling ability to
ensure employees are in the right places, working the right
times, and on the right projects?
Technological constraints. Does the rm have the required
server space and infrastructure to handle the software?
Does the rm have a strong IT department that can address
the product’s needs that will inhabit the rm’s server? If this
is not the case, should the rm pursue a product hosted on
the vendor’s server that the rm can access remotely?
Availability of technical support. What are the vendor’s
technical support capabilities? Will it be cloud-based?
Time required to implement and train staff members to use
the HRIS, including HR and payroll personnel, managers,
and employees. Who is responsible for training employees,
and how will it be done?
Initial costs and annual maintenance costs. What is the
rm’s budgetary limitations? Is a “suite” of applications
needed or just a few key applications? Experts advise HR
managers to price each application separately and then
ask vendors for a “bundled” price.
Sources: Dave Zielinski, “The Mobilization of HRTech,” HRMagazine 59, no. 2 (2014): 30–32; Drew Robb, “Building a Better Workforce,” HRMagazine 49, no. 10
(2004): 86–92; “How to Implement an Effective Process for a New HRManagement System,” HRFocus (January 2005): 3–4; “New Study Finds HRIS Key to
Reducing Costs,” Payroll Managers Report 7, no. 5 (May 2007): 13; “How to Select an HRIS,” SHRM (August 11, 2015), https://www.shrm.org/resourcesandtools/
tools-and-samples/how-to-guides/pages/howtoselectanhrissystem.aspx; Andrew Martins, “What is a Human Resource Information System?” Business News Daily
(October 29, 2020), https://www.businessnewsdaily.com/15889-what-is-a-human-resource-information-system.html; Geraldine Grones, “HRIS Systems: What You
Need to Know,” HRD (January 23, 2020), https://www.hcamag.com/ca/specialization/hr-technology/hris-systems-what-you-need-to-know/211249.
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HR directors felt that their organization found dif culty collecting meticulous
information and metrics on human cap ital exp enditure, p roductivity, and return
on investments. 55
Procter & Gamble (P&G) is an exception. P&G’s HRIS makes good internal candidates visible to managers instead of the managers having to scour the company
to nd them. The system contains information about its 135,000 employees
worldwide for promotion purposes at the country, business category, and regional
levels. It contains employees’ career histories and capabilities, as well as their education, community af liations, and development needs, and tracks the diversity of
candidates. Perhaps most importantly, managers are evaluated and compensated
on their ability to nd and groom talented employees. P&G’s results highlight that
rms do a better job of fostering talent when there is commitment, involvement,
and accountability by a company’s supervisors to do so rather than when the task
is “owned” by the HR department.56
Check In
In what ways can the HR managers and employees of small rms facilitate their competitiveness
relative to rms with superior technology? Why are employees still key?
Is s u e 4 : C o n t a in in g C o s t s W h ile Re t a in in g To p
Ta le n t a n d M a x im iz in g P r o d u c t iv it y
For years, most HR managers have been under pressure to cut labour costs.
Stretching a company’s labour dollars while gaining productivity from workers is a
challenge for managers. Organizations take many approaches to lowering labourrelated costs, including carefully managing employees’ bene ts, downsizing, outsourcing, offshoring, furloughing employees, and engaging in employee leasing
in an attempt to enhance productivity.
Few jobs come with lifetime guarantees and bene ts that will never change.
Nonetheless, employees want to work for employers that can provide them with
a certain amount of economic security. Layoffs and cuts in employee bene ts
have heightened these concerns. Some companies, such as Google, are able to
hire talented employees by offering them a great deal of job security and very
good bene ts. However, most companies, especially small ones or ones that are
struggling, nd it hard to compete with bigger rms such as Google with deluxe
bene t packages. What can they do? This is where an HR manager’s expertise and
creativity come in. Read on to see how rms are handling this challenge.
Learning Outcome 4
Explain the dual goals human resources
managers have in terms of increasing
productivity and controlling costs.
Do w nsizing
The pain of downsizing has been widespread throughout North America. Virtually
every major corporation has undergone some cycle of downsizing. Historically,
layoffs tended to affect manufacturing rms and line workers in particular, but
beginning in the 1990s, the layoffs began to encompass white-collar workers in
greater numbers in knowledge-intensive industries.
Amidst COVID-19, many industries have had to resort to downsizing. For
example, in September 2020, Nav Canada, an air navigation service company,
declared that it would eliminate 720 jobs, accounting for 14 percent of its workforce. That same month, Transat A.T. Inc., the international tourism company,
announced that it would have to cut 2,000 employees, accounting for 40 percent
of its workers. Further, Restaurants Canada conducted a survey that discovered
about 50 percent of sit-down restaurants anticipated the need to downsize in the
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coming 3 to 4 months, as of October 2020. When the government announced the
second lockdown of restaurants, tens of thousands of jobs were lost. In addition,
a survey conducted for the Chartered Professional Accountants of Canada in 2020
determined that 31 percent of business leaders were expecting to downsize their
workforce in the following year.57
Whatever the reason, whereas some rms improve ef ciency (and lower
costs) with layoffs, many others do not obtain such bene ts. Advocates of a
no-layoff policy often note that layoffs may back re after considering hidden
costs, such as the following:
●
severance and rehiring costs;
●
accrued vacation and sick-day payouts;
●
pension and bene t payoffs;
●
potential lawsuits from aggrieved workers;
●
loss of institutional memory and trust in management;
●
lack of staffers when the economy rebounds; and
●
survivors who are risk averse, paranoid, and political.58
In contrast, companies that avoid downsizing say they get some important
bene ts from such policies:
●
a ercely loyal, more productive workforce;59
●
higher customer satisfaction;60
●
readiness to snap back with the economy;61
●
a recruiting edge; and 62
●
workers who are not afraid to innovate, knowing that their jobs are safe.63
More than one executive has concluded that you do not get dedicated and
p roductive emp loyees if, at the rst sign of trouble, you show them they are
exp endable.
To approach downsizing more intelligently, some companies have made
special efforts to reassign and retrain employees for new positions when their
jobs are eliminated. Others, such as Rogers Communications, Inc., offered their
employees a four-day workweek for reduced pay on a voluntary basis.64 This is
consistent with a philosophy of employees as assets and as intellectual capital.
Furlo ug hing
furloughing
Asituation in which an organization asks
or requires employees to take time off for
either no pay or reduced pay
20
An alternative to downsizing is fu r lou gh in g. This strategy has gained widespread
use since the COVID-19 crisis started. When a company furloughs employees, it
asks them to take time off for either no pay or reduced pay. Some companies
are using creative furlough strategies to avoid downsizing and losing talent to
competitors. Instead of laying off people, the consulting rm Accenture instituted a voluntary sabbatical program known as “Flexleave.” Employees received
20 percent of their salaries and continued bene ts for 6 to 12 months, and their
stock options remained in place. The workers could take other jobs during their
sabbaticals, as long as they did not work for a competitor. Likewise, when Texas
Instruments (TI) had to lay off some of its employees, it did not just send them
out the door. It found them jobs with its suppliers, with the agreement that the
employees would return to TI when business picked up.65 Due to the serious
business impacts caused by COVID-19, Canada Goose furloughed 125 employees.
In doing so, the company provided fair compensation packages, extended bene ts, a reference letter from the CEO, and additional assistance.66
Although furloughs might sound preferable to downsizing, they have their
drawbacks too, say some HR experts. Costs are not cut as signi cantly as they
would be with downsizing because employees generally retain their bene ts
while they are furloughed. Employees who are not furloughed often end up
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with more work and feel resentful, and product and service quality, as well as
innovation, suffer as a result of the higher workloads. And as with downsizing,
furloughing employees can hurt a company’s recruiting efforts when the public
discovers it has resorted to such a measure.67
Outso urc ing
Over the past 30 years, the employment relationship between companies and
employees has shifted from relationship-based to transaction-based. Fewer
people are working for one employer over the course of their lifetimes and,
as we have explained, the Internet has created a workforce that is constantly
scanning for new opportunities. In addition, more people are choosing to work
on a freelance, or contract, basis or to work part-time, especially women and
seniors.68 Outsourcing is evidence of this trend.69 Companies hire accounting
rms to take care of their nancial services. They hire advertising rms to handle
promotions, software rms to develop data-processing systems, and law rms
to handle their legal issues. Maintenance, security, catering, and payroll (and, in
small companies, sometimes entire HR departments) are outsourced to increase
the organization’s exibility and lower its overhead costs.
Outsourcing has been one of the most prominent HR trends of the last 15 years
and will continue to be.70
Offsho ring
Offsh o r in g, also referred to as “global sourcing,” involves shifting work to
overseas locations. According to a study p ublished in Ca n a dia n Pu blic Policy,
36.4 p ercent of rms engage in offshoring. Th e industry that most heavily
used offshoring was non-durable manufacturing, in which 42.2 p ercent of rms
engaged in offshoring. 71 Cost reduction is among the key motivators for these
decisions—comp anies estimate that they can save 40 to 60 p ercent on labour
costs by reallocating work to countries such as India, where highly educated
workers can p erform the same jobs as Canadian workers at half the p rice. Other
labour markets include the Philip p ines, Russia, China, Mexico, Brazil, Hungary,
and Bosnia.
But hidden costs can sometimes chew up much of the nancial gains from
offshoring, including those associated with nding foreign vendors, productivity
lost during the transition, domestic layoff costs, language dif culties, international regulatory challenges, and political and economic instability that can
threaten operations. In Chapter 2, you will learn about the other ways rms can
gain a competitive edge besides just cutting labour costs. Though COVID-19
has caused many executives to reconsider the heavy reliance on offshoring as
a low-cost labour method, given the realized global instability,72 offshoring will
continue to be a key employment strategy as global economies continue to shift.
The key is for top managers, nance departments, and the offshoring consulting
rms they hire to begin working in conjunction with their companies’ HR departments early in the game.
Another new trend is “nearshoring.” Near sh or in g is the process of moving
jobs closer to one’s home country. For example, rising labour costs in China are
now making it attractive for North American rms to offshore work to Mexico
and Central America. Shipping the nished goods made there is also cheaper,
and the products get to sellers (and ultimately the buyers who want them) more
quickly, which can provide a rm with a competitive advantage. Yet another new
way companies are both economizing and bringing jobs back to their domestic
markets is by “h om esh or in g.” Call centre jobs are a notable example. When a
company homeshores call centre jobs, it outsources the work to domestic independent contractors who work out of their homes.
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offshoring
The business practice of sending jobs to
other countries
nearshoring
The process of moving jobs closer to one’s
home country
homeshoring
The process of moving jobs to work-fromhome domestic independent contractors
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Munir Uz Zaman/ Afp/ Getty Images
After an unsafe factory collapsed,
killing hundreds of textiles workers in
Bangladesh in 2013, approximately
70 retailers, mostly European, signed
an agreement to inspect factories they
offshore work to and nance safety
upgrades for them.
Em p lo ye e Le asing
employee leasing
The process of dismissing employees
who are then hired by a leasing company
(which handles all HR-related activities) and
contracting with that company to lease back
the employees
As an alternative to downsizing, outsourcing, offshoring, and furloughing, many
companies, especially small ones, have decided to sign em p loyee leasin g agreements with professional employer organizations (PEOs). A PEO—typically a larger
company—takes over the management of a smaller company’s HR tasks and
becomes a coemployer to its employees. The PEO performs all the HR duties
of an employer—hiring, payroll, and performance appraisal. Because PEOs can
coemploy a large number of people working at many different companies, they
can provide employees with bene ts that small companies cannot afford, such
as vision care plans. In addition, many PEOs offer their employees extime, job
sharing, part-time employment, consulting arrangements, seasonal work, and
on-call work. The value of employee leasing lies in the fact that an organization can
essentially maintain its working relationships with its employees but shift some
employment costs to the PEO, in return for a fee. More details on employee leasing
will be discussed in Chapter 5.
Pro d uc tivity Enhanc e m e nts
The results of pure cost-cutting efforts such as downsizing, furloughing, outsourcing, and employee leasing can be disappointing, however, if managers use
them as simple solutions to complex performance problems. Overemphasizing
labour costs misses the broader issue of improving a rm’s productivity. Employee
productivity is the result of a combination of employees’ abilities, motivation, and
work environment and the technology they use to work. Because productivity can
be de ned as “the output gained from a xed amount of inputs,” organizations can
increase their productivity either by reducing their inputs (the cost approach) or
by increasing the amount that employees produce by adding more human and/ or
physical capital to the process (the investment approach).
In terms of GDP per hour worked, Canada is not ranked in the top 10 globally
(it was at #18 in 2015). If Canada’s labour productivity had been the same as that
of the leading countries, individual Canadians would be wealthier, pro ts would
be higher, and governments would receive more taxes.73 Apparel and textile manufacturing have decreased but have been replaced by industries that rely more on
technological precision and brainpower than on low-skilled labour—industries
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for aircraft, sophisticated machinery, medical devices, and so on. However, the
growth in output per worker is now climbing fast in less developed countries,
such as China, that have lacked expertise and technology in the past but are
making strides to close the gap. When the investment in faster computers and
more ef cient machine tools levels off, this limits how much assistance technology can offer employees in terms of their productivity. Any additional productivity will have to come from the enhanced ability of employees, their motivation,
and their work environment, which makes the job of the HR manager in the
coming years all the more crucial.74
Many companies are nding that providing work exibility is a good way to
improve the productivity and motivation of valuable employees, especially when
giving them larger bene t packages is not an option.
Check In
If you were an HRmanager, do you think it would be possible to maintain the morale of your rm’s
employees in the face of furloughs and downsizing as a result of COVID-19? How might you do so?
Is s u e 5 : Re s p o n d in g t o t h e D e m o g r a p h ic a n d
D iv e r s it y C h a lle n g e s o f t h e W o r k fo r c e
To forecast trends to sup p ort the strategies of their organizations, HR managers
frequently analyze the cap abilities of different demograp hic group s and how
well each is rep resented in both fast-growing and slow-growing occup ations.
To accommodate shifts such as these, nd quali ed talent, and broaden their
customer bases, businesses know it is absolutely vital to increase their efforts to
recruit and train a more diverse workforce. And with a more diverse workforce
come more diverse exp ectations on the p art of emp loyees for their emp loyers
to meet.
Learning Outcome 5
Discuss how rms can leverage employee
differences to their strategic advantage and
how educational and cultural changes in the
workforce are affecting how human resources managers engage employees.
De m o g rap hic Chang e s
Among the most signi cant challenges to managers are the demographic changes
occurring in Canada. Because they affect the workforce of an employer, these
changes—in employee background, age, gender, and education—are important
topics for discussion.
The Dive rsity/ Im m ig ratio n Challe ng e
Figure 1.2 shows the top 20 ethnic origins in Canada (2016), and Figure 1.3
disp lays the 2016 p ercentage of multip le-ethnic-origins resp onses rep orted in
Canada. 75 Th e last census (2016) rep orts on the ethnocultural diversity and
immigration numbers. Of the 34.5 million Canadian p op ulation, 22 p ercent
rep orted that they were or had been a landed immigrant or p ermanent resident. 76 Over 250 ethnic origins are rep orted in the census. For the rst time,
Africa, with 13.4 p ercent of the new immigrants, ranked as second as the
main continental source of immigrants, ahead of Europ e, but far behind Asia
(61.8 p ercent). In 2019, India, China, the Philip p ines, Nigeria, and the United
States made up the largest p ortion of new immigrants. 77 Also in 2019, Toronto,
Vancouver, Montreal, Calgary, and Edmonton were the top ve p laces of residence of new immigrants. On a p er cap ita basis, Charlottetown took the lead
as 2.4 p ercent of its p op ulation were newcomers. 78 In 2020, amidst COVID-19,
Canada announced that to economically recover from the p andemic, it would
welcome 1.2 million new immigrants between 2021 and 2023. 79
Minorities in Canada are increasing in numbers relative to the population;
more than one- fth (22.3 percent), or 7.7 million Canadians, identify themselves as
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F ig u r e 1.2
To p 2 0 Ethnic Orig ins in Canad a, 2 0 16
Canadian
English
Scottish
French
Irish
German
Chinese
Italian
First Nations
(North American Indian)
East Indian
Ukrainian
Dutch
Polish
Filipino
British Isles origins, n.i.e.1
Russian
Métis
Portuguese
Welsh
Norwegian
0
1
2
3
4
5
6
7
8
9
10
11
12
Millions
Single response
Multiple response
Response type
1. “ British Isles origins, n.i.e.” includes general responses indicating British Isles origins (e.g., “ British,”
“ United Kingdom” ) as well as more specific responses indicating British Isles origins that have not been
included elsewhere (e.g., “ Celtic” ).
Note: In this chart, the sum of the ethnic origins is greater that the total population because a person
can report more than one ethnic origin in the census questionnaire.
Source: Statistics Canada, Census of Population, 2016, chart 1, https://www12.statcan.gc.ca/census-recensement/2016/as-sa/98-200-x/2016016/98-200x2016016-eng.cfm?wbdisable=true.
members of a visible minority, as de ned by the Employmen t Equ ity Act. The 2016
census estimated that by 2036, visible minorities would make up between 31.2
and 35.9 percent of the Canadian population, though the numbers may actually be
higher given the recent plan to increase the yearly immigration rate. Nonetheless,
according to the 2016 estimations, South Asians (1.9 million), Chinese (1.6 million),
and Black people (1.2 million) were the 3 largest minority groups. In 1981, only
4.7 percent of the Canadian population was comprised of visible minorities. British
Columbia and Ontario lead the country in the percentage of their visible minority
populations.
Ag e Distrib utio n o f Em p lo ye e s
Canada’s population was 38 million in 2020.80 About 6.8 million people (18 percent)
are 65 or over. The number of seniors in the Canadian population is expected
to increase to 24 percent of the population by 2050.81 Seniors accounted for
14.8 percent of the population in 2011, up from 13.7 percent 5 years earlier. In 2015,
24
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F ig u r e 1.3
Pe rc e ntag e o f M ultip le - Ethnic - Orig ins Re sp o nse s in Canad a, 2 0 16
Asian origins, 19.5
African origins, 36.1
Oceania
origins, 82.4
Other
North American
origins, 43.1
North American
Aboriginal origins, 68.9
Caribbean
origins, 45.9
European origins, 66.1
Latin, Central or
South American origins, 51.1
1. This chart shows the percentage of groups by region of ethnic or cultural origin reporting one
or more ancestries in the 2016 census.
2. 41.1% of the population reported multiple ethnic origins.
Source: Statistics Canada, Census of Population, 2016, chart 3, https://www12.statcan.gc.ca/census-recensement/
2016/as-sa/98-200-x/2016016/98-200-x2016016-eng.cfm?wbdisable=true.
New Brunswick had the highest proportion of seniors among the provinces, accounting for 19 percent of its population. However, Nunavut had the lowest proportion
of seniors in Canada at 3.7 percent of its population. Alberta had the second lowest
proportion of seniors, at 11.6 percent of its population.82
Th e echo boom generation in Canada, also known as millen n ia ls, include
p eop le born roughly between the early 1980s and mid-1990s, and rep resents
about 30 p ercent of the p op ulation of Canada. 83 Th ese workers will be needed
to ll the workforce demands created by the retirement of 9.6 million baby
boomers. Younger Canadians, under 14 years of age, account for about 16 p ercent (6 million) of the p op ulation, and those between 15 and 64 account for
about 66 p ercent (25 million). 84
The imbalance in the age distribution of the labour force is having a signi cant
effect on employers. Companies are nding that large portions of their workforces
are nearing retirement. Beyond the sheer number of employees they will have to
replace, managers are concerned that the expertise of these employees is likely to
be drained too rapidly from the company. As a stopgap measure, employers are
making positive efforts to attract older workers, especially those who have taken
early retirement. Workers are taking them up on the offer. Many baby boomers say
they expect to work past traditional retirement age. Good health and longer life
expectancies play the biggest role in extended work lives. But some retirees have
returned to the workforce because of economic needs.
Home Depot and McDonald’s Canada are among the companies making
efforts to attract older workers. Recruiting older workers may sound counterintuitive because they incur higher healthcare costs. But older workers also have fewer
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dependents and offer other cost savings. As one HR professional states, “Our over-50
employee turnover is ten times less than those under 30. So when you think about
the savings you have in training costs, transitions costs, and recruitment costs, you
save a lot more on that for the over-50 workers than you do for others.”85 The
aging population may lower the interest rates and affect the economy. There is also
a decline in the number of business startups in Canada to the tune of 16.2 percent.
This, too, can be partially blamed on the aging population.86
The newest generation entering the workplace is Generation Z. The members
of Generation Z were born in the mid-1990s and early 2000s. The 2016 Census
data suggest that they would make up almost one- fth of the workforce by 2020.
However, in 2020, Generation Z encompassed approximately 12 percent of the
workforce.87 The lower employment level is likely partly due to COVID-19. The
pandemic caused an unemployment crisis in 2020, and members of Generation Z
were among those hardest hit.88 Nonetheless, the members of this age group
are and will increasingly be an important part of the workforce. These workers
have never known life without smartphones and social media and they expect to
be trained and managed with digital tools. They are also more comfortable with
racial, cultural, and sexual diversity than other generations and want to change
the world for the better. A large number of members of this generation say they
want to start their own businesses. Others, having grown up during the 2008
recession, want to go straight to work rather than incurring the cost of post-secondary education. Further, it is predicted that individuals will be more hesitant to
pursue entrepreneurship post-COVID-19. There may be an even steeper decline
in startups in the coming years.89
As mentioned earlier, the millennial generation, born between 1972 and 1992,
represents about 30 percent of the Canadian population and is also in uencing
the labour market in Canada. By 2025, it is predicted that millennials will account
for three-quarters of the workforce worldwide.90 Also known as Generation Y,
millennials are generally regarded as having good technological know-how and
initiative, especially when it comes to starting their own businesses. (Facebook
founder Mark Zuckerberg is a notable example.) They are particularly interested
in meaningful work that will improve the world around them. Similar to the
trends with baby boomers, those who constitute this new population bulge are
experiencing greater competition for advancement from others of approximately
the same age.
Another major generation in the workforce is Generation X, people born
between 1964 and mid-1970s. Many members of Generation X watched their
baby-boomer parents get downsized at some point in their lives. Consequently,
now that they are raising children themselves, Generation X values job security. However, they are less likely to think of themselves as being wed to one
employer as their parents were. The members of Generation X are also independent. They like challenging rather than repetitive work and dislike supervisors
who look over their shoulders.
Managers can nd themselves challenged in terms of getting the various
generations to work well together. Baby boomers sometimes categorize younger
workers as having a poorer work ethic. Some younger workers have the perception that older workers are set in their ways and technologically challenged. The
situation can also create supervisory issues. How will a 55-year-old react to being
managed by someone in their 20s or 30s? To help companies overcome these
obstacles, HR departments and experts are developing programs to help the generations understand one another better so they can capitalize on one another’s
strengths rather than prey on one another’s weaknesses.
Keep in mind that the four generations of workers we have described here
are generalizations. Individual employees are vastly different from one another
and motivated by different factors, even if they belong to the same generation.
It is up to managers to determine what drives each person to best apply their
talents and to meet the person’s employment demands and career aspirations.
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AzmanL/ E+/ Getty Images
Three generations work together in this
setting.
Ge nd e r Distrib utio n o f the W o rkfo rc e
Women make up nearly half of the workforce in Canada,91 and the educational
attainment of women is also increasing relative to men. Today, more than 60 percent
of university graduates are women. Employers wanting to attract the talent that
women have to offer are taking measures to ensure that they are treated equally in
the workplace in terms of their advancement opportunities and compensation. In
addition, more companies are accommodating working parents by offering them
parental leave, part-time employment, exible work schedules, job sharing, telecommuting, and childcare and eldercare assistance.
As we have suggested, harnessing a company’s talent means being aware
of characteristics common to employees while also managing these employees
as in dividu a ls. It means not just tolerating or accommodating all sorts of differences but also supporting, nurturing, and using these differences to the organization’s advantage—in other words, strategically leveraging them rather than simply
managing them so that people are treated equitably and “everyone gets along.”92
HR managers have to ask themselves the following question: What is it about the
experiences, mindsets, and talents of different groups of people that can be used in
a strategic way? After all, despite our similarities, a ll of us are different in one way
or another, aside from the obvious differences we have outlined in this section.
These differences, too, can be the source of organizational strength.
Organizations exceedingly realize the value of diversity and inclusion to tap into
Canada’s top talent.93 However, many organizations struggle to suf ciently attend
to the needs and issues that transgender and gender-nonconforming people face.94
The current gender equality efforts often overlook the approximately 1.5 million
adults in the United States and Canada who are transgender. The unemployment
rate for transgender and gender-nonconforming individuals in Ontario is approximately 20 percent, which was over double the province’s average at the time of data
collection.95 In a Toronto study, it was found that about 50 percent of transgender
individuals earn $15,000 or less annually, and only 37 percent were employed fulltime, even though 71 percent of such individuals have post-secondary education.96
In another Ontario study, 20 percent or more respondents claimed they had encountered employment obstacles over the past few years, including unjust terminations
or unfair disciplinary procedures, harassment, or unpaid compensation.97 This
workplace discrimination impacts their job attitudes, behaviour, and overall health.98
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There are initiatives underway to improve the conditions for transgender and
gender-nonconforming people. For example, Trans Workforce debuted in Toronto
in 2017 as the country’s rst job fair explicitly for transgender job applicants. The
event hosted many employers, including TD Bank, the Ontario government, The
Durham District School Board, the City of Toronto, and Apple Canada.99 Further,
close to 85 percent of Fortu n e 500 companies now have policies against identity discrimination, whereas, in 2002, only about 3 percent of these companies had similar
policies.100 The Government of Canada has also published a guide on its website
explaining how to support transgender employees. The guide includes allowing
the individual to dress in clothing that they feel is appropriate to their gender identity and allowing the individual to use the facilities in which they are comfortable,
among other recommendations.101 Later in the text, we will discuss more about the
steps rms can take to leverage employee differences.
Is s u e 6 : A d a p t in g t o Ed u c a t io n a l a n d C u lt u r a l
Sh ift s A ffe c t in g t h e W o r k fo r c e
Ed uc atio n o f the W o rkfo rc e
The 2016 Census shows that more than half (54.0 percent) of Canadians aged
25 to 64 had either college or university quali cations, up from 48.3 percent in
2006. Canada continues to rank at the top among the Organisation for Economic
Co-operation and Development (OECD) countries in terms of the proportion of
college and university graduates.
The 2016 Census con rmed that higher education is a gateway to higher
earnings, as did all previous censuses. The data suggest that for women between
25 and 64 years old, who worked full-time, full-year, with a high school diploma
earned $43,234; those with a college diploma earned $48,599, and those with
a bachelor’s degree earned $68,342. The comparative gures for men were
$55,744, $67,965, and $82,082.102 (Apart from the income–education differences,
the male–female earnings gap is noticeable).
According to the Association of Universities and Colleges of Canada, the value
of a college or university degree is $1 million over the course of a career. The
unemployment rates of those with only high-school education are on average 12 to
20 percent higher than those of degree holders of the same age. It is important to
note, however, that whereas the complexity of jobs is increasing signi cantly, the
skills gap is huge and widening. More than 3 million Canadians (aged 16 to 65)
have problems reading printed material.
Cultural Chang e s
The attitudes, beliefs, values, and customs of people in a society are an integral
part of their culture. Naturally, their culture affects their behaviour on the job
and the environment within the organization, in uencing their reactions to work
assignments, leadership styles, and reward systems. Like the external and internal
environments of which it is a part, culture is undergoing continual change. HR
policies and procedures therefore must be adjusted to cope with this change.
Em p lo ye e Rig hts
Over the past few decades, federal legislation has radically changed the rules for
management of employees by granting them many speci c rights. Among these are
laws granting employees the right to equal employment opportunity (Chapter 3),
union representation if they desire it (Chapter 14), a safe and healthful work environment (Chapter 12), pension plans regulated by the government (Chapter 11),
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equal pay for men and women performing essentially the same job (Chapter 9), and
privacy in the workplace (Chapter 13). An expanded discussion of the speci c areas
in which rights and responsibilities are of concern to employers and employees will
be presented in Chapter 13.
Co nc e rn fo r Privac y
HR managers and their staffs, as well as line managers in positions of responsibility,
generally recognize the importance of discretion in handling all types of information
about employees. The Person a l In forma tion Protection a n d Electron ic Docu men ts
Act (PIPEDA) is a federal law that deals with the collection, use, and disclosure
of personal information (note that Quebec is the only province with similar laws,
although Ontario, British Columbia, and others have draft legislation in place). This
law requires federally regulated organizations holding personal information on customers or employees to obtain their consent before they use, collect, or disclose this
information. Employer responses to the issue of information privacy vary widely.
IBM was one of the rst companies to show concern for how personal information about employees was handled. It began restricting the release of information
as early as 1965 and, in 1971, developed a comprehensive privacy policy. Royal
Bank of Canada (RBC), Hudson’s Bay Company, and Zero Knowledge Systems in
Montreal are among other employers that have developed privacy programs.
Although PIPEDA protects people’s electronic communications, such as their
email, the rules are different when it comes to the privacy that employees can
expect with regard to their electronic communications at work. Workers are
learning the hard way that their employers have a right to monitor their email and
Internet use, for example. The information employees post on the Web—either
on social networking sites or on job-hunting sites such as Monster.com—has also
become subject to scrutiny by employers. Electronic surveillance in the workplace
is also becoming an issue. In Chapter 13, we will discuss the content of privacy
programs, along with the privacy employees can expect while on the job, and
recommend some privacy guidelines.
The Chang ing N ature o f the Jo b
The era of the full-time, permanent job seems to have disappeared. The number
of self-employed is also increasing, accounting for 15.6 percent of employment.
The number of Canadians self-employed increased by 41,100 in January 2015,
accounting for almost 54 percent of total new job growth.103 Nearly half of all
the jobs created in the last two decades have been nonstandard; that is, part-time,
temporary, or contract work.104
As job security erodes, so do pension plans and healthcare bene ts, especially
for part-timers. Nonstandard jobs represent about 30 percent of all employment.105
The Business Case outlines the advantages of employing temporary workers but also
shows why a company has moved away from this strategy to reap higher bene ts.
As shown in Ethics in HRM, labour force participants have become increasingly polarized into haves and have-nots. We return to the subject of changing
employment options in Chapter 4.
Chang ing Attitud e s to w ard W o rk
Employees today are less likely to de ne their personal success only in terms
of nancial gains. Many employees, especially younger ones, believe that satisfaction in life is more likely to result from balancing their work challenges
and rewards with those in their personal lives. Although most people still enjoy
work and want to excel at it, they tend to be focused on nding interesting work
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The Business Case
A d v a n t a g e s a n d D is a d v a n t a g e s o f Pa r t - Tim e W o r k e r s
The trend in Canadian employment is de nitely away from
full-time, “permanent” jobs toward the use of part-time and
temporary employees. The advantages of employing temporary
workers are numerous.
●
●
●
●
●
●
●
It reduces payroll costs because part-time and temporary
workers seldom receive the same bene ts as full-time
workers. This factor is particularly important during
periods of economic decline.
Businesses can respond to uctuations in demand.
Contingent workers can be hired or dismissed
during periods of high or low demand (e.g., for retail
stores—high demand during holiday seasons and low
demand in January).
Temporary employees can be hired more speedily amidst
a rapid change in the business environment (e.g., during
COVID-19, the rate of IT change and consumerization of IT
increased rapidly, and IT departments required quick and
immediate help to meet the demands they encountered).
Full-time employees typically expect to work a normal
daytime schedule. However, part-time workers are often
more willing to work evenings and weekends, especially if
they have a full-time job or are students.
Businesses can access speci c expertise. When an organization enters a new business or needs speci c expertise for
a limited time (development of a website, for example), it
makes economic sense to hire only for that need. Contingent
workers may also be used to bring in new ideas and skills
from other organizations and/or train regular employees.
Organizations can “test” employees’ skills and t with the
organization by specifying a limited work contract. In this
way, productive employees can be hired and those who are
underperformers can be released without costly termination costs.
Particular to smaller organizations, part-time employees
allow for more employees. With a bigger workforce,
a smaller organization can have a more diverse
workforce, which can have various benefits such as
appealing to a more extensive customer base, impacting
the community, and enhancing the organization’s
perspective.
Most employers recognize these advantages and so wish to
employ more contingent and part-time employees. However,
although these costs are easily assessed, there may be greater
bene ts to be achieved by hiring full-time employees. Amazon
thinks so. Amazon had increased its temporary workforce in
the United States by 175,000 people at the outset of COVID-19
to accommodate immediate needs. In May 2020, Amazon
offered 125,000 such temporary workers full-time positions
with full bene ts and continued to further tremendously expand
its full-time workforce in both the United States and Canada
thereafter.
Although hiring part-time workers has various bene ts,
there are also several drawbacks to consider.
●
●
●
●
●
●
Employees often lack the type of commitment that full-time
employees often possess. This is due in part to the lack of
commitment demonstrated by the employer, in terms of
bene ts and hours.
Due to limited hours and the nature of their work, particularly seasonal work, they lack knowledge and familiarity
with the organization, which can impact their performance.
In a client-facing job, some clients or customers may prefer
a more personalized relationship with the same individual. If
there is a continuous new stream of workers, the perception of
the organization and customer service levels can be damaged.
Part-time or temporary workers may feel less connected to
the company culture as they spend less time with coworkers.
Furthermore, with more part-time or temporary workers, fulltime employees may also lack suf cient connection to their
coworkers and may feel undervalued as though they may be
replaced, which will also affect the company culture.
Higher training costs result, and health and safety are
impacted.
Turnover and absenteeism tend to be more of an issue with
part-time workers.
Sources: M. Dunn, “Who Chooses Part-time Work and Why,” Monthly Labor Review (March 2018): 1–25; T. Agovino, “Tinkering with Time,” HRMagazine 62, no. 1
(2017): 46–52; G. White, “Finding the Best Temp Worker for the Job,” Canadian HRReporter 22, no. 9 (2009): 17; Neil Kokemuller, “Advantages & Disadvantages
of Part-time Employees,” Chron (2020), http://smallbusiness.chron.com/advantages-disadvantages-parttime-employees-21870.html; Mark Skelton, “Flexible
Resourcing Looks to Plug the IT Skills Gap,” The HRDirector (December 16, 2020); Lisa McQuerrey, “What Are the Disadvantages to Hiring Temporary Workers?”
Biz uent (May 8, 2019), https://biz uent.com/info-8068457-disadvantages-hiring-temporary-workers.html; Natalie Dreier, “Amazon to Offer Temporary Workers
Full-Time Positions,” Kiro 7 (May 29, 2020); Sebastian Herrera, “Amazon is Expanding Its Of ces, Hiring: Inside the Tech Giant’s Strategy,” Wall Street Journal
(September 14, 2020).
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and are more inclined to pursue multiple careers rather than being satis ed
with just “having a job.” Figure 1.4 outlines ndings from a recent study. These
researchers gathered 38,000 reviews from the highest and lowest-rated employers
on Glassdoor, a website where individuals anonymously review companies for
which they work or have worked. People appear to be seeking ways of living that
are less complicated but more meaningful and with richer interpersonal relationships. These new lifestyles cannot help having an impact on the way employees
must be motivated and managed.
Employees’ changing attitudes contribute to higher employee turnover.
Younger employees especially have new expectations from their employers 106
and are also much more willing to leave their positions to pursue other opportunities if they feel unsatis ed. Retention is one of the most prominent challenges
organizations face today. One study from 2018 found that 42 million American
employees, meaning 1 in 4 employees in the United States, would leave their job
for another organization that year. Over 3 of 4 of such employees could have
been prevented from leaving, according to data from 234,000 exit interviews.107
Organizations often look for strategies to retain employees. However, relying
mainly on monetary incentives may not be the best solution for today’s workforce.108 Organizations must reexamine work attributes such as increasing work–
life balance, enhancing organizational culture, and learning how to improve
employee interest.109 This readjustment can be a challenge for traditional human
resources departments.110
B alanc ing W o rk and Fam ily
Work and family are connected in many subtle and not-so-subtle social, economic,
and psychological ways. Because of the forms that the family now takes—such
as the two-wage earner and the single-parent family—work organizations are
F ig u r e 1.4
Fac to rs Re late d to the B e st and W o rst Plac e s to W o rk
Best places
to work
Worst places
to work
Praises
Complaints
Social (35% )
Interest (23% )
Economic (16% )
Application (14% )
Work–Life Balance (9% )
Development (3% )
Interest (31% )
Economic (31% )
Work–Life Balance (21% )
Social (9% )
Application (5% )
Management (3% )
Work–Life Balance (29% )
Application (24% )
Social (20% )
Economic (13% )
Interest (10% )
Development (4% )
Economic (38% )
Management (30% )
Application (8% )
Interest (7% )
Social (7% )
Work–Life Balance (6% )
Development (4% )
This is why people come
and stay!
This is why people
leave!
Source: Amir Dabirian, Jan Kietzmann, and Hoda Diba, “A Great Place to Work!? Understanding Crowdsourced Employer
Branding,” Business Horizons 60, no. 2 (2017): 197–205.
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Ethics in HRM
Skyw alke rs and Gro und w o rke rs
Canadian workers can be divided into two classes: skywalkers
and groundworkers. Skywalkers, those working in white-collar
jobs in high-rise buildings, are well educated, well trained, and
earn good incomes. Their jobs are secure, and they receive full
bene ts. For these knowledge workers, the employment prospects in computer programming, nancial analysis, insurance,
business services, and real estate are bright. Those working as
managers in the high-rises on Bay Street, Howe Street, and rue
St-Jacques earned relatively high incomes.
Below the high-rise buildings toil the groundworkers.
Those with little education and outdated skills are suffering
massive unemployment. Groundworkers suffer further from
job insecurity and a lack of bene t programs. Look for these
workers in restaurants, hotels, and shops. The “McJobs” they
hold in the accommodation, food, and beverage industries are
generally paid minimum wages. Those working part-time—a
growing segment that now comprises 34 percent of the
Canadian workforce—fare even worse. Companies have
discovered cost savings by replacing full-time employees with
part-time workers, thereby eliminating bene ts and increasing
staf ng exibility. This restructuring of the job market has
produced winners and losers, but many would argue that
all Canadians lose when the unemployment rate is high and
citizens feel insecure about their futures.
Sources: Daniel Tenser, “‘Permanent Damage’ to Job Prospects as Canada Shifts to Low-Wage Hiring,” Huf ngton Post (December 12, 2016), https://www
.huf ngtonpost.ca/2016/07/12/low-wage-jobs-canada-hiring_n_10945650.html, retrieved April 9, 2018; Heather Scof eld, “Hold the McJobs: Canada’s High
End Employment Boom,” The Globe and Mail (February 17, 2006): B1, B4; Statistics Canada, “Statistics Canada Measures of Weekly Earnings,” http://www4
.hrsdc.gc.ca/.3ndic.1t.4r@-eng.jsp?iid518, retrieved May 11, 2009.
nding it advantageous to provide employees with more family-friendly options.
“Family friendly” is a broad term that can include exible work hours, daycare,
eldercare, part-time work, job sharing, pregnancy leave, parental leave, executive
transfers, spousal involvement in career planning, assistance with family problems, and telecommuting.
Comp an ies with p rograms su ch as th ese calcu late th at accommod atin g
th eir emp loyees’ in d ivid u al n eeds an d circu mstan ces is a p owerfu l way to
attract an d retain top -calibre p eop le. Aetn a Life an d Casu alty, for examp le, cut
its turn over by 50 p ercen t after it began offerin g 6-mon th p aren tal leaves, cou p led with an op tion for p art-time work wh en emp loyees retu rn to th e job. 111
With th at said, family-frien d ly comp an ies mu st balan ce th e ben e ts th ey p rovid e to families versu s th eir sin gle emp loyees. Th e majority of emp loyees
h ave n o ch ild ren u n d er 18. A recen t stu d y fou n d th at ch ild less, d u al-career
coup les d id n ot h ave equ al access to exible arran gemen ts an d accommod ation s as d o emp loyees with ch ild ren . Th e au th or p red icted th at ch ild less
emp loyees wou ld become exceed in gly resen tful if p olicies d id n ot start to
con sid er family d iversity. 112
See Highlights in HRM 1.3 for a discussion with Nora Spinks, an expert in
work–life harmony.
Check In
Think about some of the teams of which you have been a member. Which of them performed
better: those that were diverse or those that were not? What challenges and opportunities did the
more diverse teams present? How do you think HRM can best manage diverse teams?
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Highlights in HRM 1.3
W o rk–Life H arm o ny
Nora Spinks, president and CEOof Work–Life Harmony, a
consulting company specializing in work–life balance issues,
comments on the demographic issues affecting employee
behaviour:
Women are in the workplace to stay; they have fewer
and shorter career breaks and have more opportunities
to make or in uence organizational decisions. There is a
high proportion of the aging ‘boomer’ workforce that are
asking, ‘What is my legacy?’ They are rethinking priorities
and lifestyles and reducing the number of hours they
are working. At the same time, the millennial generation
[i.e., the generation born in the 1980s] is entering the
workforce and managerial positions with a fresh perspective and different outlook on the work experience. They
see work as a means to having a life, not as life in and of
itself. The boomers tend to live to work; the nexus generation work to live. Growing up, they witnessed people
give up a life for the sake of a job, only to see them
ultimately lose employment in periods of downsizing and
restructuring. They don’t want the same experience.
A recent international study of students found that
young people about to enter the workforce wanted to have
a challenging career with plenty of opportunity to grow
personally and professionally, and they wanted to be able
to take advantage of those opportunities while achieving
work–life balance. It is up to organizations, executives, and
managers to create the kinds of environments to make
that possible. It is the only way for them to meet increasing
customer/client demands, meet the challenges of global
competition, and reach their organizational objectives.
Source: Interview with Nora Spinks.
Th e P a r t n e r s h ip o f L in e M a n a g e r s a n d
H u m a n Re s o u r c e s D e p a r t m e n t s
We have taken a good deal of time upfront in this text to outline today’s competitive and social challenges to reinforce the idea that managing people is not something that occurs in a backroom called the HR department. Managing people is
every manager’s business, and successful organizations combine the experience
of lin e m an ager s with the expertise of HR specialists to develop and use the
talents of employees to their greatest potential. Addressing HR issues is rarely the
exclusive responsibility of HR departments acting alone.
Human Resources and Skills Development Canada is projecting an excess
demand for HR managers and professions. Nonetheless, we understand that most
readers of this book will be line managers and supervisors rather than HR specialists. This text is, therefore, oriented to helpin g people ma n a ge people more
effectively, whether they become rst-line supervisors or CEOs.
Learning Outcome 6
Provide examples of the roles and competencies of today’s human resources
professionals.
line managers
Non-HR managers who are responsible for
overseeing the work of other employees
Re s p o n s ib ilit ie s o f t h e H R M a n a g e r
Although line managers and HR managers need to work together, their responsibilities are different, as are their competencies and expertise. The major activities
for which an HR manager is typically responsible are as follows:
1. Stra tegic a dvice a n d cou n sel. The HR manager often serves as an in-house
consultant to supervisors, managers, and executives. Given their knowledge
of internal employment issues (policies, labour agreements, past practices,
ethics and corporate governance, and the needs of employees), as
well as their awareness of external trends (such as economic outlooks,
employment data, legal developments, and regulatory issues), HR managers
can be an invaluable resource for making decisions.
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2. Ser vice. HR managers also perform a host of service activities, such as
recruiting, selecting, testing, planning and conducting training programs,
and hearing employee concerns and complaints. Technical expertise in
these areas is essential for HR managers. Moreover, managers must be
convinced that HR staff are there to help them increase their productivity
rather than to impose obstacles to their goals.
3. Policy for mu la tion a n d implemen ta tion . HR managers generally propose
and draft new policies or policy revisions to address recurring problems
or to prevent anticipated problems. Perhaps more importantly, they are a
resource to whom managers can turn for policy interpretation.
4. Employee a dvoca cy. One of the enduring roles of HR managers is to
serve as an employee advocate—listening to employees’ concerns and
representing their needs to managers—to ensure that the interests of
employees and the interests of the organization are aligned with one
another. Effective employee relations provide a support structure when
disruptive changes interfere with workers’ normal daily activities.
5. Bu sin ess ma ster y. HR professionals need to know the business of their
organization thoroughly. This requires an understanding of its economic
and nancial capabilities so that they can become a key member of the
team of business managers to develop the rm’s strategic direction
6. HR ma ster y. HR professionals are the organization’s behavioural science
experts. HR professionals should develop expert knowledge in the
areas of staf ng, development, appraisals, rewards, team building, and
communication.
7. Cha n ge ma ster y. HR professionals must be able to manage change
processes so that their rms’ HR activities are effectively merged with the
business needs of their organizations.
8. Per son a l credibility. Like other management professionals, HR
professionals must establish personal credibility in the eyes of their internal
and external customers. Credibility and trust are earned by developing
personal relationships with one’s customers, demonstrating the values of
the rm, standing up for one’s own beliefs, and being fair-minded when
dealing with others.
C o m p e t e n c ie s o f t h e H R M a n a g e r
As top executives expect HR managers to assume a broader role in overall organizational strategy, many of these managers will need to acquire a complementary
set of competencies. These competencies are summarized here and shown in
Figure 1.5.
The HRM profession is currently experiencing changes, both in Canada and
globally. There is a need for HR professionals to become more accountable to
those they serve. As a result, several jurisdictions across Canada are implementing
new rules for HR professionals’ conduct.
Good HR managers help their organizations build a sustained competitive
advantage. At lower levels in the organization, a rapidly growing number of companies, including Ford Canada and UPS Canada, are assigning HR representatives to
their core business teams to make certain that HR issues are addressed on the job
and that their HR representatives, in turn, are knowledgeable about core business
issues rather than simply focusing on employee-related administrative functions.
Check In
Have you ever found yourself in a similar situation at work or school where you had to satisfy two
different groups? Were you able to keep both groups happy? How were the challenges you faced
similar to those faced by HRmanagers as they serve both management and employees?
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F ig u r e 1.5
H um an Re so urc e Co m p e te nc y M o d e l
BUSINESS
MASTERY
Business acumen
Customer orientation
External relations
HR MASTERY
Staffing
Performance
appraisal
Rewards system
Communication
Organization design
PERSONAL
CREDIBILITY
Trust
Personal
relationships
Lived values
Courage
CHANGE
MASTERY
Interpersonal skills
and influence
Problem-solving skills
Rewards system
Innovativeness and
creativity
Source: Arthur Yeung, Wayne Brockbank, and Dave Ulrich, “Lower Cost, Higher Value: Human Resource Function in Transformation.” Reprinted with permission
from Human Resource Planning, Vol. 17, No. 3 (1994). Copyright 1994 by The Human Resource Planning Society, 317 Madison Avenue, Suite 1509, New York, NY
10017. Phone: (212) 490-6387. Fax: (212) 682-6851.
Small Business Application
Organizations have a variety of staff-related requirements associated with supporting business operations. These could include
hiring, paying, managing, training, or terminating staff. This could
also involve work design or staf ng strategies and ensuring legal
compliance. Traditionally, the role of an HRgeneralist is a position in
medium or large organizations, those with 100 employees or more.
However, as of 2015, 98 percent of businesses in Canada
were considered small, and there are 1.14 million of these. The
vast majority of these would have fewer than 100 employees,
which would be too small to justify having an HRgeneralist on
staff. Small business represents 48 percent of private-sector jobs
in Canada, employing more workers than either large or medium
enterprises. As a result, small business owners without HR
generalists manage over ve million employees in Canada. It is
apparent that small business owners need the tools and practices
employed by HRgeneralists integrated into a handbook they can
refer to as needed.
Who is responsible for the delivery of HRresponsibilities in
small business depends on a number of contextual factors: the
size of the company, the nature of the business, the nancial
status of the company, the management structure, the structure
of support roles, the leadership culture, and the approach to using
vendors. HRsupport may be delivered by business owners themselves for very small companies, by managers for slightly larger
companies, and by of ce managers for larger companies. Small
businesses may outsource some or all of this support to vendors
who support many clients. Activities such as payroll, bene ts, and
legal support are often delivered through vendors.
The types of services traditionally delivered by HRgeneralists in large enterprises that are delivered in small companies
are, to a large extent, driven by the industry, size, and geographic
location. For example, the HRneeds in a retail environment
with high employee turnover will focus largely on recruiting and
training, although the needs in a stable construction business
may centre around health and safety. Through this text, we will
dedicate a section of each chapter to the applicability to small
business of the practices reviewed and will draw on industryspeci c examples that help demonstrate each practice.
Source: Statistics Canada, “Key Small Business Statistics,” June 2016, https://www.ic.gc.ca/eic/site/061.nsf/eng/h_03018.html#point1-1, retrieved April 9, 2018.
Reproduced and distributed on an “as is” basis with the permission of Statistics Canada.
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Summary
Outcome 1 Understanding human resource management p ractices and issues can help you better comp ete
in the current business environment—as an emp loyee,
manager, or HR manager. HR managers who have a
good understanding of their rm’s business can help
it achieve its strategies—whatever they may be—
through the effective use of p eop le and their talents.
An organization’s success increasingly dep ends on the
knowledge, skills, and abilities of its emp loyees. To
“comp ete through p eop le,” organizations have to do a
good job of managing human cap ital: the knowledge,
skills, and cap abilities that have value to organizations.
Managers must develop strategies for identifying,
recruiting, and hiring the best talent available;
develop ing these emp loyees in ways that are rm
sp eci c; help ing them generate new ideas and generalize them throughout the comp any; encouraging
information sharing; and rewarding collaboration and
teamwork among emp loyees.
Outcome 2 COVID-19 has impacted organizations
and human resources management in multiple ways,
including recruitment, selection, performance management, and rewards. Other aspects of the wider
environment continue to in uence HRM, including
globalization and managing people through balance a
complicated set of issues related to managing people
working under different business conditions in different geographies, cultures, and legal environments.
HR strategies and functions have to be adjusted to take
into account these differences. The fast pace of globalization and corporate scandals over the years have led
to a new focus on corporate social responsibility (good
citizenship) and sustainability (a company’s ability to
produce a good or service without damaging the environment or depleting a resource).
Outcome 3 Technology has tended to reduce the
number of jobs that require little skill and to increase
the number of jobs that require considerable skill, a shift
we refer to as moving from touch labour to knowledge
work. This displaces some employees and requires that
others be retrained. In addition, information technology
has in uenced HRM through HRISs that streamline HR
processes, make information more readily available to
managers and employees, and enable HR departments
to focus on the rm’s strategies. The Internet and social
media are also affecting how employees are hired,
work, and are managed. COVID-19 has complicated
these issues.
Outcome 4 To contain costs, organizations have been
downsizing, outsourcing, offshoring, furloughing, and
leasing employees, as well as enhancing productivity.
HR’s role is not only to implement these programs but
also to consider the pros and cons of programs such as
these and how they might affect a company’s ability to
compete, especially if they lead to the loss of talented
staff members.
Outcome 5 The workforce is becoming increasingly
diverse, and organizations are doing more to address
employee concerns and to maximize the bene t of different kinds of employees. By rst seeing the differences, exploring them, and then discovering how they
can provide value to the organization, HR managers can
leverage those differences thee bene t of employees
and employers.
Outcome 6 In working with line managers to address
their organization’s challenges, HR managers play
a number of important roles; they are called on for
strategic advice and ethics counsel, various service
activities, policy formulation and implementation, and
employee advocacy. To perform these roles effectively,
HR managers must have a deep understanding of their
rm’s operational, nancial, and personnel capabilities. Every manager’s job involves managing people.
Consequently, successful companies combine the
expertise of HR specialists with the experience of line
managers and executives to develop and use the talents
of employees to their greatest potential.
Key Terms
change management, 7
collaborative software, 12
corporate social responsibility, 11
downsizing, 7
employee leasing, 22
furloughing, 20
globalization, 8
homeshoring, 21
36
human capital, 3
human resources information
system (HRIS), 15
human resources management
(HRM), 2
knowledge workers, 13
line managers, 33
nearshoring, 21
offshoring, 21
outsourcing, 7
proactive change, 8
reactive changes, 8
reengineering, 7
six sigma, 7
sustainability, 12
workforce (HR) analytics, 16
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Discussion Questions
1. Many contend that the COVID-19 pandemic
brought to fore the critical importance of people
organizations. Why is this so?
2. Suppose your boss asked you to summarize the
major people-related concerns in opening an
of ce in India. What issues would be on your list?
3. Name a company you hope to work for someday.
What is its track record in terms of corporate
social responsibility and sustainability? Are these
factors important to you? Why or why not?
4. Will technology eliminate the need for HR
managers? How will Arti cial Intelligence affect
human resource management?
5. In groups, debate the proposition: Employees are
an expense, and their numbers should be reduced.
6. Wh at are th e p ros an d con s of h avin g a more
d iverse workforce? Is Can ad a in a better
p osition to comp ete globally becau se of its
d iverse p op u lation ? Fin d examp les from a
sch ool or work p roject wh ere h avin g a d iverse
team mad e a d ifferen ce an d exp lain th at
d ifferen ce.
7. What are the advantages and disadvantages of
part-time workers, especially in the context of the
COVID-19 pandemic?
8. Should HR professionals be the “voice” for
employees or the “spokesperson” for managers?
Explain your view. Should HR professionals be
licensed, like accountants and lawyers?
HRM Experience
B alanc ing Co m p e titive Challe ng e s and Em p lo ye e Co nc e rns
HRM is not just the responsibility of the personnel department. If
people are a competitive resource, then line managers play an
increasingly important role in managing the workforce. But this is
not an either/or situation. Rather than seeing line managers assume
the responsibilities of HRmanagers, we see both groups working
together to handle workforce issues. But how exactly do these two
groups work together?
Assignment
1. Working in teams of four to six individuals, identify what role
the HR department would play in terms of the following activities and what role line managers would play. Where would
overlaps occur, and would there be any likely problems?
a. recruiting and selection
b. training and development
c. compensation
d. performance evaluation
e. labour relations
2. How would potential problems be resolved?
3. Write the groups’ ndings on ip charts and post for all to
see. One member from each team should explain their ndings to all class members.
4. Point out the similarities and differences across the teams.
Save these points and revisit them—possibly revising
them—as you study subsequent chapters in this text.
Sign in or create an account at login.cengage.com to start using MindTap. Register the access code from
the printed card included with your text or redeemed online from your instant access code purchase. If you
do not have a code, you can purchase instant access at Cengage.ca.
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Case Study 1
New HRStrategy Makes Lloyd’s a “Best Company”
Robert Evans/ Alamy Stock Photo
After more than
300 years in
business, a few
years ago, the
global insurer
Lloyd’s
of
nally
London
set out to establish its rst true
HR
strategy,
starting with the hiring of HR Director Suzy Black. “I was
brought in to transform the HR function from one modeled on an old-style personnel of ce to a function that is
more cutting edge, business focused, and value adding,”
says Black.
Black’s rst order of business was to evaluate the
current state of affairs, particularly how the corporation’s senior managers perceived the HR role. With
this information in hand, Black and her team began
to develop an overarching strategic agenda as well as
speci c tactics, addressing everything from recruitment to performance management to basic policies to
rewards and compensation.
Changing long-time employees’ perception of HR
took a bit of convincing, but employees quickly began
to recognize the value of Black’s actions. Gradually,
they could see how the HR strategies were effectively
creating conditions in which they could develop in their
careers, be successful, and nd meaning and value in
their work. Today, Lloyd’s employees list the company’s
challenging work environment, healthy incentive programs, and meaningful community outreach programs
among the key reasons they enjoy working for the
insurance giant.
Black’s efforts also enhanced Lloyd’s position as a
desirable place to work. The average tenure of employees
at the company is, incredibly, 21 years. The insurer has
been named one of the “Top 100 Best Companies to Work
For” (in the United Kingdom) by the Su n da y Times and
hailed as one of the United Kingdom’s Top 40 Business
Brands by an independent researcher.
Each year, new graduates scramble to get hired by
Lloyd’s. These new hires rotate through three to four
different assignments within Lloyd’s so they get a perspective of the company and the insurance market as
well as a better idea of the departments in which they
would like to ultimately work. Lloyd’s also offers a
graduate program in insurance, apprenticeships, and
internships.
Work–life balance at the company is good. Although
sometimes extra hours have to be worked, that’s not
the norm. Working mothers can choose to work partor full-time. In addition, the company offers employees
time to do charity and nonwork-related activities to further their personal growth, says Black. “Employees are
very sophisticated people, and they have more drivers
than just wanting to earn money,” she notes.
Ironically, Black’s position was the rst HR position
she had ever held, having risen through the ranks in
other arenas in business. But her experience has given
her a clear de nition of the ideal characteristics of the
HR professionals. “They must understand change and
transformation, excel at operations, and balance tactical
and strategic thinking and acting,” she says. “They will
have to be able to manage and navigate organizational
complexity and ambiguities and not be afraid to say no
occasionally in order to establish appropriate boundaries with the business.”
Questions
1. What skills does Black think employees need, to
work successfully in the area of HR?
2. What are some of the outcomes of the company’s
new HR strategy?
3. What do you think might be some of the challenges of establishing HR policies for a global
company?
4. What types of situations do you think might require
an HR manager to say “no”?
Sources: “Lloyd’s: ATop Place toWork,” Lloyds.com (March 16, 2011), http://www.lloyds.com; Helen William, “City Slicker,” Personnel Today (August 11, 2009): 10–11;
Digby Morgan Human Resourcefulness Newsletter (February 2010), http://www.digbymorgannewsletter.com/story04_HR_02_10.htm. © 2019 Cengage Learning
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Case Study 2
Intergenerational Issues
Christinne Muschi/ Reuters/ Alamy Stock
Photo
to “use” the system in the same way that a 25-year
employee did. The junior employees learned very
When Jason
quickly how to manipulate the collective agreement to
Traynor was
their advantage. Activities such as punch card fraud,
a junior HR
not badging in or out, and leaving the facility unauthoradministrator
ized while still on the clock were quickly becoming
at Peregrine
the norm. According to Jason Traynor, “This is not
Incorporated,
the kind of behaviour you want in your new hires.”
he faced serHaving new employees acting as though they had put
ious
chalin 20 years of service often created con ict between the
lenges with a
two generations because many of the senior employees
workforce of
felt that these “kids” had not paid their dues and were
different ages. The reason for many of the issues was
simply riding the coattails of the senior membership.
that GM had recently sold off the fabrication plant as
Addiction problems were rampant among the new
part of its new business strategy to get out of auto parts
employees—many having never been exposed to the
manufacturing and focus solely on assembling vehicles.
readily available supply of drugs and alcohol. Linked to
With the sale of the plant came the condition that any
this were the increasing levels of casual absenteeism.
GM employee would be allowed to return to the main
Many new hires were terminated, and a great deal of
GM autoplex as positions came open through employee
time and energy was spent working with the union,
attrition. Once a GM employee left, that person had to
which fought to reinstate these employees.
be replaced. More times than not, GM would “call out”
An independent third-party consulting company
(recruit) 30 to 40 employees with only 2 or 3 days’
was asked to help manage these issues. Self-directed
notice to Peregrine. With no pool of candidates available,
workshops were initiated to teach the workers about
Peregrine had to react quickly so as not to disrupt proteamwork and quality. Employee assistance programs
duction at GM.
were created to help struggling employees. A labour
Due to time constraints, prescreening was minimal.
council was started to deal with con ict on the facThere were often no interviews, reference checks, or
tory oor. The company adopted aptitude testing and
selection instruments. On several occasions, people
joint interviewing with the union in an attempt to select
would be selected on Friday night for a Monday moremployees who were more quali ed.
ning start. The majority of the new hires were young
In the end, Peregrine eventually failed and went
and right out of high school. These new employees,
out of business.
with limited postsecondary education and little, if any,
factory experience, were earning $28 an hour, plus Questions
bene ts, which equalled approximately $85,000 per
year. The job was so lucrative that many opted out
1. Based on your experiences working with students/
of pursuing further education. The biggest challenge
colleagues of different ages, do you believe that
came when the 18- to 19-year-olds were thrown into
there are generational differences in attitudes
a working environment of preretirement 60-year-old
toward work? Do a search to see if there is any evifactory workers. There were con icts and complaints
dence for these beliefs.
about everything from the type of music choice on the
2. As the demand for autos declined, and GM and
shop oor to clothing tastes and inappropriate sexual
Chrysler faced bankruptcy, the bene ts given to
comments.
auto workers were reduced. Check out the compenOne of the greatest challenges began when the
sation packages for new auto workers and decide if
senior employees began interacting with the junior
the package is attractive enough for young workers
employees and the new employees would attempt
to leave school, as these young workers did.
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Case Study 3
Shell’s Top Recruiter Takes His Cues from
Marketing
Bakerjarvis/ Alamy Stock Photo
When Navjot
Singh joined
Royal Dutch
Shell in 2003,
the company
was facing an
extraordinary
challenge: the
rate at which
Shell’s engineers were retiring meant that the global rm needed
to double the number of new recruits it hired from
2,697 in 2005 to 5,440 by 2006 and to nearly 8,000
in 2008. Yet at the time, Shell was not considered an
employer of choice. The global oil and gas company
needed to project a new image—fast! Says Singh, “In
the same way marketers know they need to advertise to
be a market leader, HR had to know how to create an
employer brand. Marketing is the only way to ensure
customers buy products. It was also the only way to
ensure Shell got the best people coming to us rst.”
Wait! Why is Shell’s HR guy talking about marketing? As both an HR and a marketing expert, Singh
sees a powerful synergy between the two. “I’m 50% a
marketer—the rest is HR, communications, and recruitment,” says Singh. “But I’m an HR person, really.” Singh’s
of cial job title, however, is Global Marketing Manager,
Recruitment and Global HR Communications Manager,
Shell (UK), a title and position like no other. Having
come to Shell from DaimlerChrysler, where he served
as the marketing director, Singh initially started out as
vice president of customer relationship management
but quickly joined the HR team when he recognized
Shell’s emerging need for new talent and the immense
potential for him to use classic marketing techniques
to help the company achieve its objectives. His vision,
skill sets, and experience were a perfect match for the
company’s situation.
So, in Singh’s mind, addressing the company’s need
for new talent meant building a brand as an employer,
which in turn meant creating a cohesive message. But
Shell’s global recruiting approach was anything but
cohesive. “At the time we had 1,200 recruitment systems,
35 recruitment companies, and 400 executive search
companies working for us,” he recalls. “I attended a
careers event at Cambridge University where there were
three Shell stands beside each other—one from the UK,
one from Malaysia, and another from Nigeria. This was
a fragmented approach and tough for candidates to
understand.” Shell needed to create a uni ed outreach
program if it was going to meet its need for numbers
while ful lling its desire for a global talent pool. The
company recruits from among 90 different nationalities
each year because it recognizes the bene ts of cultural
diversity.
Singh and his team set about applying various marketing techniques to the recruitment process, which
have since resulted in an 80 percent cut in recruitment
costs, a 20 percent reduction in the time to hire new
staff, and a very real claim to being the top employer in
its market segment. In fact, Shell has won 80 awards for
its unique HR strategy. “I think it’s important to make
sure that employer branding activities are ef cient and
effective and that you have the right tools and processes, but also that it’s competitively positioned from
a cost perspective,” notes Singh. “I also think you need
to look at it in terms of satisfaction, with the employer
value proposition which you create. You need to ensure
that there is a high satisfaction level amongst your staff,
that they are motivated and have pride in working for
your company.”
Having come so close to putting itself in danger of
not attracting enough skilled candidates, Shell intends to
continue running its recruitment program just like any
other branding effort, thus ensuring that it has the right
human resources to deliver on its promises and achieve
worldwide success. Singh believes Shell is typical of
many rms, noting, “In the future, companies will have
to apply for skilled people to work for them rather than
candidates applying to work at an organization. HR must
still realize the strategic value it can bring.”
Questions
1. What functions of HRM are similar to marketing
functions? How can thinking about “marketing” a
company’s jobs improve the strategic focus of HR
personnel?
2. If you were planning to use marketing strategies to
“brand” a company as an employer of choice, what
are some of the factors you would consider?
3. Do you agree with Singh’s statement that in the
future, companies will have to apply for skilled
people to work for them rather than candidates
applying to work at an organization? Why or
why not?
Sources: Excerpted from Don Wood, “Lateral Thinking,” Human Resources (January 2010): 12–13; Christopher Van Mossevelde, “Views from the Top,” Employer Branding
Today, April 16, 2009, http://www.employerbrandingtoday.com; Peter Crush, “Shell UK Combines HR and Marketing to Sell the Brand,” HR Magazine, August 25, 2009,
http://www.hrmagazine.co.uk.
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Notes and References
1. “Canada’s Best Jobs 2019: The Top 25 Jobs in Canada,”
Ca n a dia n Bu sin ess, https:/ / www.canadianbusiness.com/ lists-and-rankings/ best-jobs/ canadasbest-jobs-2019-the-top-25-jobs-in-canada/ , retrieved
January 1, 2021.
2. “The Top 15 Jobs in Canada 2021,” Ra n dsta d, https:/ /
www.randstad.ca/ best-jobs/ top-15-jobs/ , retrieved
January 1, 2021.
3. “Careers in Human Resources Management,” SHRM,
https:/ / www.shrm.org/ membership/ student-resources/
pages/ careersinhrm.aspx, retrieved January 2, 2021.
4. T. J. Watson, Jr., A Bu sin ess a n d Its Beliefs: The Idea s
Tha t Helped Bu ild IBM (New York: McGraw-Hill, 1963).
5. Jon Windust, “Top 10 CEO Quotes on People
Management 2015,” https:/ / www.cognology.com.au/ topten-ceo-quotes-on-people-management-2015/ , retrieved
April 4, 2018; Donald C. Busi, “Assignment Reviews
(ARs): Moving toward Measuring Your Most Valuable
Asset,” Su per vision 66, no. 1 ( January 2005): 3–7.
6. Susan Caminiti, “How the Coronavirus Crisis has
Elevated the Role of HR Chiefs in the C-Suite,” MSNBC
(April 22, 2020).
7. Fred Pennic, “Human API CEO Talks Data Privacy
Concerns in Employee Wellness Programs,” HIT Con su lta n t
(December 23, 2020), https:/ / hitconsultant.net/ 2020/ 12/ 23/
human-api-ceo-talks-data-privacy-concerns-in-employeewellness-programs/ , retrieved January 1, 2021.
8. Erica Volini, “Leading Forward,” Deloitte, https:/ / www2.
deloitte.com/ xe/ en/ insights/ focus/ human-capitaltrends/ 2021/ human-capital-workforce-disruption.html,
retrieved January 1, 2021.
9. David Lepak and Scott Snell, “Managing the Human
Resource Architecture for Knowledge-Based Competition,”
in S. Jackson, M. Hitt, and A. DeNisi (eds.), Ma n a gin g
Kn owledge for Su sta in ed Competitive Adva n ta ge:
Design in g Stra tegies for Effective Hu ma n Resou rce
Ma n a gemen t (SIOP Scienti c Frontiers Series, 2003):
127–54; David Lepak and Scott Snell, “Examining the
Human Resource Architecture: The Relationship among
Human Capital, Employment, and Human Resource
Con gurations,” Jou rn a l of Ma n a gemen t 28, no. 4 (2002):
517–43; Steve Bates, “Study Links HR Practices with the
Bottom Line,” HR Ma ga zin e 46, no. 12 (December 2001):
14; Ann Pomeroy, “Cooking Up Innovation: When It
Comes to Helping Employees Create New Products and
Services, HR’s Efforts Are a Key Ingredient,” HR Ma ga zin e
49, no. 11 (November 2004): 46–54; Kiwook Kwon,
Johngseok Bae, and John J. Lawler, “High Commitment
HR Practices and Top Performers,” Ma n a gemen t
In tern a tion a l Review 50, no. 1 (2010): 57–80.
10. Dave Ulrich, Steve Kerr, and Ron Ashkenas, The GE
Work-Ou t: How to Implemen t GE’s Revolu tion a ry Method for
Bu stin g Bu rea u cra cy & Atta ckin g Orga n iza tion a l Problems
(New York: McGraw-Hill Professional Publishing, 2002).
11. John P. Kotter, “Ten Observations,” Execu tive Excellen ce
16, no. 8 (1999): 15–16.
12. Jeanne Meister, “The Impact of the Coronavirus
on HR and the New Normal of Work,” Forbes
(March 31, 2020), https:/ / www.forbes.com/
sites/ jeannemeister/ 2020/ 03/ 31/ the-impact-ofthe-coronavirus-on-hr-and-the-new-normal-ofwork/ ?sh=c5386852b602.
13. ADP Canada, “Has Covid-19 Rede ned the Role of HR?”
Newswire (September 23, 2020).
14. Nurhuda Syed, “Covid-19: HR’s main challenges
revealed,” HR Director (April 1, 2020).
15. Susan Caminiti, “How the Coronavirus Crisis has
Elevated the Role of HR Chiefs in the C-Suite,” CNBC
(April 22, 2020).
16. Jeanne Meister, “The Impact of the Coronavirus on HR
and the New Normal of Work.”
17. Tracy Brower, “HR’s Compelling New Role in Response
to the Coronavirus,” Forbes ( June 7, 2020).
18. Jeanne Meister, “The Impact of the Coronavirus on HR
and the New Normal of Work.”
19. “Compensation Planning During Uncertain Times,” The
Con feren ce Boa rd of Ca n a da (August 7, 2020).
20. Jeanne Meister, “The Impact of the Coronavirus on HR
and the New Normal of Work.”
21. Jeanne Meister, “The Impact of the Coronavirus on HR
and the New Normal of Work.”
22. Jeanne Meister, “The Impact of the Coronavirus on HR
and the New Normal of Work.”
23. Jared Lindzon, “Welcome to a New Era of Human
Resources,” Fa st Compa n y (May 20, 2015), https:/ / www.
fastcompany.com, retrieved April 5, 2018.
24. M. Hammer and J. Ch amp y, Reen gin eer in g the
Cor por a tion (New York: Harp erCollins, 1994). See
also Mich ael Hammer, Beyon d Reen gin eer in g: How
the Pr ocess-Cen ter ed Or ga n iza tion Is Cha n gin g Ou r
Wor k a n d Ou r Lives (New York: Harp er Business,
1996); William M. James, “Best HR Practices for
Today’s Innovation Management,” Resea r ch-Techn ology
Ma n a gemen t 45, no. 1 ( January–February 2002):
57–61.
25. Lee G. Bolman and Terry E. Deal, “Four Steps to
Keeping Change Efforts Heading in the Right Direction,”
Jou r n a l of Qu a lity a n d Pa r ticipa tion 22, no. 3 (May/
June 1999): 6–11; “Coaching Employees through the Six
Stages of Change,” HR Focu s 79, no. 5 (May 2002): 9;
Stefan Stern, “Forever Changing,” Ma n a gemen t Toda y
(February 7, 2005): 40; Dennis Smillie, “Managing
Change, Maximizing Technology,” Mu lti-Hou sin g
News 40, no. 1 ( January 2005): 4; Julie Hodges,
Ma n a gin g a n d Lea din g People (London, UK: Kogan
Page Limited, 2016).
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26. Jennifer Rivkin, “The New Rules of Growth,” Pr o t 24,
no. 5 (2005): 58.
27. Evan Cleave, Marcello Vecchio, Duncan Spilsbury,
and Godwin Arku, “Manufacturing Change and Policy
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One of the clichés about the annual reports of companies is that they often claim
that “people are our most important asset.” Leaders in many organizations say the
same thing when they are in the public. You also hear this statement at academic
and practitioner conferences. Do you believe this is true? Historically, managers
often have not acted as though they themselves believed it. Too often the focus
has been on minimizing the number of a rm’s employees rather than strategically using their talents.
But for many rms, this is changing. Organizations are exceedingly realizing
the importance of human capital and focusing on strategic actions that target the
complete employee experience to support people on the job. In fact, organizational culture, engagement, and employee brand proposition were listed as top
priorities in a Deloitte survey. Close to 80 percent of executives rated employee
experience as very important (42 percent) or important (38 percent).1 Accordingly,
in another survey, 57 percent of executives viewed HR as an equal leadership
partner in the organization to support the organization’s human capital.2
Forward-thinking companies are also demanding that their HR groups push
past short-term projections and provide detailed forecasts for needs and the
associated costs over a two- to three-year horizon or more. Even small companies
are realizing that their employees are the key to ensuring their ability to compete
and survive. As Apple’s famous founder is reported to have said, “Hiring the best
is your most important task.” And as GE’s legendary ex-CEO Jack Welch puts it:
“We live in a global economy. To have a ghting chance, every company needs to
get every employee, with every idea in their heads and every morsel of energy in
their bodies, into the game.”3
St r a t e g ic P la n n in g a n d H u m a n Re s o u r c e s
As we explained in Chapter 1, “competing through people” is the theme for this
book. But the idea remains only a premise for action until put into practice. To
realize this theme, we need to understand some of the systems and processes in
organizations that link HRM and strategic management. A few de nitions may be
helpful upfront.
Str ategic p lan n in g involves a set of procedures for making decisions about
the organization’s long-term goals and strategies. In this chapter, we discuss strategic plans as having a strong external orientation that covers major portions of
the organization. The plans especially focus on how the organization will position
itself relative to its competitors to ensure its long-term survival, create value, and
grow. Hu m an resou rces p lan n in g (HRP), by comparison, is the process of anticipating and providing for the movement of people into, within, and out of an organization. Overall, its purpose is to help managers deploy their human resources
as effectively as possible, where and when they are needed, to accomplish the
organization’s goals. Str ategic h u m an resou rces m an agem en t (SHRM) combines
strategic planning and HRP. It can be thought of as the pattern of human resources
deployments and activities that enable an organization to achieve its strategic goals.
HRP is an essential activity of organizations. For examp le, consider the
insurance comp any CNA Financial Corp . CNA Financial discovered via HRP that
it would run short of underwriters—a key skill p ool in the comp any—in just
two years if its turnover rate continued on p ace. The global strategies rms are
increasingly p ursuing, such as mergers, joint ventures, offshoring, the relocation
of p lants, p roduct innovation p lans, and downsizing, are also making HRP more
critical and more comp lex for managers. The good news, according to the p resident and CEO of the Human Resource Planning Society, is that increased global
comp etitiveness, which in many industries has led to the commoditization of
p roducts based on p rice, is making talent the “great differentiator” among rms.
As we explained in Chapter 1, it is relatively easy for a competitor to copy your
product and make it more cheaply. But duplicating the talents of your employees
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Learning Outcome 1
Explain how human resources planning
and a rm’s mission, vision, and values
are integrally linked to its strategy and
rm performance, and the role of High
Performance Work Systems (HPWS).
strategic planning
Procedures for making decisions about
the organization’s long-term goals and
strategies
human resources planning (HRP)
The process of anticipating and providing for
the movement of people into, within, and out
of an organization
strategic human resources
management (SHRM)
The pattern of human resources
deployments and activities that enable an
organization to achieve its strategic goals
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will prove much more dif cult.4 The dramatic shifts in the composition of the
labour force that are occurring also require that HR managers become more
involved in planning because these changes affect the full range of a company’s
HR practices (such as employee recruitment, selection, training, compensation,
and motivation).
H ig h - P e r fo r m a n c e W o r k Sy s t e m s
A major topic of discussion among Canadian organizations is how to gain or
maintain competitive advantage as the economy and the environment for business rapidly change. An avenue by which an organization can maintain a competitive advantage is through its human capital. Human capital is an intangible
asset that is unique and not easily duplicatable. Therefore, organizations often
look to high-performance work systems (HPWS) to capitalize on employees as a
distinctive source of competitive advantage.
HPWS is a group of human resource practices that have been proven to
increase an organization’s ability to attract, select, hire, develop, and retain highperforming employees.5 HPWS stresses employee involvement and a culture of
commitment rather than control. It also emphasizes the importance of the quest
for excellence and expects employees to be highly quali ed, competent, and
engaged in improving the organization.6
Research has outlined sets of speci c activities that encompass the HPWS
that have been organized into different subsystems.7 The rst system involves
engaging employees by bringing to their awareness the organization’s vision and
providing employees with a personal stake in the vision and its success. Activities
include conveying the mission and vision and clarifying the employees’ role in
supporting the vision. It also includes information sharing on organizational performance and other matters. When an organization shares nancial, strategic, and
performance information, it emphasizes that employees are trusted partners and
employees can use this information to support their organization in realizing its
goals.8 Activities to engage employees might also include performance-contingent compensation such as gainsharing and goal-anchored bonuses or involving
employees in decision making with activities such as quality circles, town hall
meetings and suggestion systems.9
The second subsystem involves acquiring and developing talent by attending
to the attraction, selection, and development processes. These practices include
rigorous recruiting such as referral incentives, employee branding, and workforce planning. Another method entails selective hiring through methods such as
personality assessments, work samples, and assessment centers. Acquiring and
developing talent also involves extensive training and career development tasks
so that internal labour pools can ideally ll open positions.10
The third subsystem encompasses employee empowerment, such as developing policies and practices for employment security so that employees can speak
up without repercussion, decreasing status distinctions to promote egalitarianism
and open communication, and team/ decentralized decision making.11 The key
is to promote training by commitment instead of training focused on control.12
Th e nal subsystem involves aligning leaders so that leaders can sup p ort the growth and evolution of the organization. Such tasks might include
management training linked to organizational needs such as core comp etency
models or outlining leadership goals associated with training, assessment, and
feedback p rograms. Tasks might also include succession p lanning to identify
and sup p ort the growth of future leaders through leadership workforce analysis and career p lanning, as well as p erformance-contingent comp ensation for
leaders to link achievement of corp orate and dep artment goals with leadership
comp ensation. 13
A plethora of research has outlined the positive effects of HPWS on an
organization. HPWS encourages information exchange among employees and
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motivates employees to produce creative ideas.14 It increases employee commitment and reduces feelings of job strain.15 An HPWS outlines to employees that
their employers are invested in them and their development and value them and
their voice in decision-making.16 Under an HPWS, employees also feel increased
commitment from departmental leaders and thus employees are more likely to
engage in the prosocial behaviours that help their team meet their objectives.
These behaviours permit organizational units to be more ef cient and exible
because employees are willing to perform activities outside of the bounds of
their narrowly de ned job descriptions. This mutuality is likely to produce longterm positive effects. Organizational citizenship behaviours are more likely to
become incorporated as a part of the norms and values of the organizational
culture. This scenario leads to not only a more positive culture and more positive employee attitudes but also increased department performance.17 In other
studies, HPWS has been found to increase productivity18 and organizational
ambidexterity, which means it can be ef cient and adaptable in today’s continually changing business world.19
St r a t e g ic P la n n in g a n d H RP : L in k in g
the Pro c e s s e s
Good HR managers “marry” HRP to the strategic planning process for their organizations as a whole. HRP relates to strategic planning in several ways but at a
fundamental level we can focus on two issues: strategy formulation and strategy
implementation. HRP provides a set of inputs into the strategic for mu la tion process in terms of what is possible; that is, whether a rm has the types and numbers of people available to pursue a given strategy. For example, when Indigo
executives contemplated the move into Web-based commerce to compete with
Amazon.com, one of the issues they had to address was whether they had the
talent needed to succeed in that arena.
In addition to strategy formulation, HRP is important in terms of strategy
implemen ta tion . In other words, once the rm has devised its strategy, the company’s executives must make resource allocation decisions to implement that
strategy, including decisions related to the rm’s structure, processes, and human
capital.20 Companies such as GE have taken strides to combine these two aspects
of strategic management.21 All the available evidence suggests that the integration of HRP and strategic planning tends to be most effective when there is a
reciprocal relationship between the two processes. When this occurs, a rm’s top
management team recognizes that strategic planning decisions affect—and are
affected by—HR concerns.
Although the rm’s business strategy establishes the context for its HR
strategy, it is not a one-way street. The typ e of peop le an organization has, and
the culture and climate of the comp any, in turn will con stra in what the rm is
able to achieve strategically. So, HRP and strategic p lanning are integral to one
another. The value and relationship between HRP and strategic planning has
become even more evident amidst the global p andemic. As Edward Houghton,
head of research and thought leadership at CIPD in the UK p uts it, “It is hugely
insightful to see HR functions in this research looking beyond their traditional
stakeholder groups to exp lore their imp act in a more holistic way. This ap p ears
to be clear recognition of the growing strategic value of the function, and the
ongoing role it must p lay through the challenging times ahead.”22 HR managers, along with the other top executives of their rms, are therefore imp ortant
facilitators and strategic p artners of the p lanning p rocess.23 That is why, in this
chap ter, we lay out a step -by-step p rocess to show how a rm’s HRP and strategy
efforts can be integrated.
Figure 2.1, which will serve as a map for this chapter’s discussion, shows
how companies align their HRP and strategic planning in this way: a rm’s business strategy, along with its overall purpose, goals, and values, establishes the
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F ig u r e 2 .1
Linking Strate g ic Planning and H um an Re so urc e s
Mission, Vision,
and Values
SWOT Analysis
External
Analysis
Internal
Analysis
Strategy
Formulation
Strategy
Implementation
Evaluation
ORGANIZATIONAL LEVEL
HUMAN RESOURCES LEVEL
• Identify purpose and scope of
organization
• Clarify its long-term direction
• Establish its enduring beliefs
and principles
• Capture underlying business
philosophy
• Establish cultural foundation
• Guide ethical codes of conduct
• Assess its opportunities and threats
(OT)
• Conduct environmental scanning
(legal, etc.)
• Analyze the industry and
competitors
• Gauge demographic trends
• Gauge the external supply of labour
• Benchmark competitors’ HR metrics
• Analyze firm’s strengths and
weaknesses (SW)
• Analyze firm’s core competencies
• Analyze firm’s resources: people,
process, systems
• Analyze workforce’s culture,
competencies, and composition
• Forecast the demand for employees
• Forecast the supply of employees
• Develop corporate strategy
• Develop business strategy
• Functional strategy: ensure
alignment
• Establish productivity and efficiency
goals
• Establish quality, service, speed, and
innovation goals for workforce
• Ensure vertical and horizontal fit
• Design structure, systems, and so on
• Allocate resources
• Reconcile supply and demand via
hiring, downsizing, layoffs, and so on
• Use staffing, training, rewards, and so
on to motivate employees to achieve
the strategy
• Evaluate benchmarking efforts
• Ensure alignment is achieved
• Encourage workforce agility and
flexibility
• Maintain human capital metrics
• Utilize balanced scorecard
context for its HR strategy and the number and types of people, the skills they
must have, and the like. In other words, the rm’s HR strategy follows the business strategy and helps implement it. For example, if the rm’s strategy is based
on ef ciency, the HR strategy will focus on practices that encourage employees
to look for better, faster, and more ef cient ways for the company to do business. If the rm’s strategy is to compete based on innovation, its HR strategy will
implement practices that encourage and incentivize employees to be creative and
innovate. For example, at GE, employees receive monetary incentives for developing and patenting products for the company.
St e p 1: M is s io n , Vis io n , a n d Va lu e s
mission
The basic purpose of the organization as
well as its scope of operations
50
Wh en you entered college or university, you p robably th ough t a lot about wh at
you sh ould do with your life. Believe it or not, rms go th rough th e same sort
of search p rocess wh en th ey develop th eir strategic p lans. Th e rst step in strategic p lanning is establish ing a mission, vision, and values for th e organization.
Th e m issio n is th e basic p urp ose of th e organization, as well as its scop e of
op erations. It is a statement of th e organization’s reason for existing and th e
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sh ared p urp ose of th e p eop le in th e organization. Th e mission often is written
in terms of general clients th e organization services. Dep ending on th e scop e
of th e organization, th e mission may be broad or narrow. For examp le, th e mission of Google is “to organize th e world’s information and make it universally
accessible and useful.”24
The str ategic vision of the organization moves beyond the mission statement to provide a perspective on where the company is headed and what the
organization can become in the future. Although the terms mission and vision
often are used interchangeably, the vision statement ideally clari es the longterm direction of the company and its strategic intent.
Organizational cor e valu es are the strong, enduring beliefs and principles
that the company uses as a foundation for its decisions. These are the underlying
parameters for how the company will act toward customers, employees, and the
public in general. In many cases, the values capture the underlying philosophy
of the company culture and give direction to its employees. The values also place
limits on what behaviour is seen as ethical and acceptable. Highlights in HRM 2.1
shows the mission, vision, and values of Air Canada.
strategic vision
Astatement about where the company is
going and what it can become in the future;
clari es the long-term direction of the
company and its strategic intent
core values
The strong and enduring beliefs and
principles that the company uses as a
foundation for its decisions
D e v e lo p in g a M is s io n St a t e m e n t
As a manager or business owner, how would you begin to craft the mission statement for your rm? One way to begin would be to ask yourself the following
questions and write down your answers:
●
What is my organization’s reason for being? What need do we ful ll that isn’t
already being met by another rm or could be better met?
●
For whom would the rm ful ll the need? Who are our customers?
●
How do we ful ll, or better ful ll, the need?
Highlights in HRM 2.1
Air Canad a: M issio n, Visio n, and Value s
Safety First and Last
100% . All the time.
Make every Customer feel Valued
With our words. With our actions.
With our products and services.
Connecting Canada and the World.
Our Vision
Building loyalty through passion
and innovation
Our Values
Underpinning our Mission and
Vision are core Values that inform
all we do as individuals and
collectively at Air Canada. These
values serve as touchstones to
guide our actions.
Working Together
With Colleagues, Customers, and Community.
Act with Integrity
We are accountable. We foster an environment of
trust. We communicate openly and in a timely manner.
All Employees are Valued
We respect. We listen. We act.
Drive for Excellence
Personally. Corporately.
Ever reaching for the next level of innovation,
quality and service.
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Courtesy of Air Canada.
Our Mission
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●
●
Where is our market and our customers? Where will we operate? Locally,
geographically, or globally?
What core values do the people in my organization share and will continue
to embrace as part of our mission? How do these values differentiate us from
other companies?
Once an organization or entrepreneur has the answer to these questions,
they can begin to draft a mission statement that synthesizes the information. For
example, Marriott’s mission, or vision statement, is “to enhance the lives of our
customers by creating and enabling unsurpassed vacation and leisure experiences.” The company’s core values are as follows:
●
putting people rst
●
pursuing excellence
●
embracing changing
●
acting with integrity
●
serving our world
And Uber’s mission, or vision statement, is “We ignite opportunity by setting
the world in motion.”
H R’s Ro le in Es t a b lis h in g a n d Re in fo r c in g
a Fir m ’s M is s io n , Vis io n , a n d Va lu e s
By serving as a sounding board, HR managers can play a key role when it comes
to formulating, vetting, and ne-tuning a rm’s mission, vision, and values. Does
the mission statement accurately re ect employees’ beliefs or only upper management’s? Does it accurately re ect the public’s perception of the organization? If
not, how should it be changed? A rm’s mission statement keeps everyone on the
“same page” and heading in the same direction. Hence, it needs to be accurate.
HR managers help embody the rm’s mission, vision, and values within the
organization by doing the following:
●
●
●
Communicating these frequently, informally and formally, via verbal and
written communications such as emp loyee meetings, emails, newsletters,
bulletin boards, the rm’s website, annual rep orts, and emp loyee orientations. Some rms, including Nordstrom’s, make it a p oint to ask rank-andle emp loyees to relate to new hires work incidents that demonstrate how
they p ut a rm’s mission, vision, and values into action. Doing so is more
p owerful and motivating than merely stating them or p utting them into p rint.
Recruiting and hiring emp loyees whose values are consistent with the organization. This can also help organizations attract millennial workers who
p lace a high p riority on nding emp loyment that is meaningful to them and
aligned with their goals and values in life, says Dov Seidman, a leading HR
consultant.
Translating the mission, vision, and values into speci c on-the-job behaviours
and job descriptions and recognizing and rewarding employees based on them.
Like organizations themselves, rms must be prepared to change their
mission statements as conditions change over time. Monitoring those changes
requires a rm to continually scan the environment for threats and opportunities,
which we discuss next.
Check In
Why is HR planning integral to strategic planning? What role does a rm’s mission, vision, and
values play in strategy formation? What are the linkages between High Performance Work Systems
and rm performance?
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St e p 2 : Ex t e r n a l A n a ly s is
Learning Outcome 2
Before you decided on your major, you p robably looked at information about
p ossible careers, and whether or not there were many op p ortunities in those
careers. Were certain elds becoming more demanding or more p ro table
than others? Firms do something similar. On an ongoing basis, they analyze
external op p ortunities and threats. En vir on m en tal scan n in g is the systematic
monitoring of the major external forces in uencing the organization, including
forces in the business environment, the remote environment, and the comp etitive environment.25
Understand how an organization’s external
environment in uences its strategic
planning.
environmental scanning
Systematic monitoring of the major external
forces in uencing the organization
Th e B u s in e s s En v ir o n m e n t
A rm’s business environment consists of all the external factors in the general environment—factors a rm cannot directly control but that can affect its
strategy. In the next sections, we will look at these factors and how HR personnel
can help their companies understand the business environment.
The remote environment is part of the business environment. It includes
forces that generally affect most, if not all, rms—forces over which they have
virtually no control. Changes in the economy, technological changes, demographic changes, and legal and regulatory changes are examples. By and large, a
rm can only adapt to these changes rather than in uence them.
Ec o no m ic and Ec o lo g ic al Chang e s
All rms must react to changes in the economy, including general, regional, and
global conditions. During economic booms, rms are more likely to expand.
During recessions, they generally contract. But this isn’t true for all businesses.
It depends on their strategies. Dollar stores, such as Dollarama and Dollar Tree,
saw their sales and stock prices rise during the last recession. Business was so
brisk that they expanded by opening thousands of new stores and hired thousands of employees.26
Closely related to the economy are ecological conditions. The catastrophic
tsunami that struck Japan in 2011 affected thousands of different types of businesses there, as well as their supply-chain partners worldwide. One Japanese
semiconductor manufacturer recovered more quickly than its peers thanks to
a strategy it had developed in the aftermath of an earthquake three years earlier: the company had created exible manufacturing capabilities and plans that
allowed it to shift production to unaffected manufacturing facilities in other parts
of Japan and Asia.27
Te c hno lo g ic al Chang e s
Like economic and ecological changes, technological changes such as automation have a broad effect on businesses—changes that they have had to adapt
to strategically. The Internet, of course, has affected businesses in nearly every
industry and in nearly every country. Think about travel agents. For decades, they
were the key resource people used to search for ights, hotels, rental cars, and
the like. However, with the advent of online reservation systems, travel agents
have had to adapt their approach. Today, they are as likely to compete based on
the service they provide and the expertise they have about particular locations.
Likewise, newspapers have had to adjust from print to digital subscribers
and alter their sales and revenues strategies to match the new medium or go out
of business. Many technology experts expect that in the future 3D printers and
other technological advances will dramatically change what products get made,
how they get made, and by whom.
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Consider Walmart. For decades, selling products at low prices has been
Walmart’s main focus. But now the retailer is facing increasing social pressure to
provide better pay for employees. Offering low prices yet higher employee pay
will be a signi cant strategic challenge.
Le g al and Re g ulato ry Chang e s
Finally, government and legislative issues, including laws, have a broad effect on
the remote environment. Any one change can require rms, and entire industries,
to dramatically adjust their strategic direction. And it’s not just North American
laws and regulations that are a part of the remote environment but the laws of
other countries as well that affect businesses. Until recently, Apple and other 5G
smartphone makers were unable to sell their devices in the lucrative Chinese
market because the Chinese government hadn’t granted the country’s major telecommunications companies licences to build 5G networks there.28
C o m p e t it iv e En v ir o n m e n t
Th e comp etitive environment is narrower than the remote environment, and
rms have a greater ability to affect it. As Figure 2.2 shows, the comp etitive
environment includes the rm’s customers, rival rms, new entrants, substitutes, and sup p liers. Firms analyze their comp etitive environment to adap t to
or in uence the nature of the comp etition. A general rule of thumb about this
analysis is that the more p ower each of these forces has, the less p ro table
(and therefore the less attractive) the industry will be. Let us look at each of
the ve forces.
Custo m e rs
A rm’s strategy should focus on creating value for customers, who often want
different things. For example, in the hotel industry, business travellers may want
convenient locations with meeting facilities. Vacationers may want resort locations with swimming pools, golf courses, and luxury spas. Other travellers may
just want an inexpensive room next to the highway. The point is that, increasingly,
“one size does not t all” and organizations need to know how they will provide
value to customers. That is the foundation for strategy, and it in uences the kind
F ig u r e 2 .2
Five Fo rc e s Fram e w o rk
NEW ENTRANTS
SUPPLIERS
RIVAL
FIRMS
CUSTOMERS
SUBSTITUTES
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of skills and behaviour that will be needed from employees. For example, actions
and attitudes that lead to excellent customer service can include friendliness, the
willingness to meet the special needs of customers, etc.
Rival Firm s
In addition to customer analysis, perhaps the most obvious element of industry
analysis is examining the nature of competition. The rst question to consider is:
Who is the competition? Often the answer is clear to everyone, but sometimes it is
not. For example, for many years, Toys “R” Us viewed its main competitors to be
other toy stores, such as FAO Schwarz or KB Toys. However, other retailers, such
as Zellers and Walmart, soon moved into this space very successfully. This had a
direct effect on HRP for Toys “R” Us. Although in the past Toys “R” Us had been
successful with a volume-based approach (i.e., “stack it high, and let it y”), bigger
retailers soon gained an advantage—who can beat Walmart’s volume and cost
advantage? As a consequence, Toys “R” Us had to modify its strategy to compete
more on customer service and the expertise of its employees. But did Toys “R” Us
have the number and kind of employees required to compete in this way? Were its
staf ng, training, performance management, and compensation practices aligned
with this strategy? The rm closed its stores in the United States; however, its
Canadian operations appear to be nancially healthy—at least for the time being.
N e w Entrants
New comp anies can sometimes enter an industry and comp ete well against
establish ed rms, and sometimes th ey cannot. To p rotect th eir p osition, comp anies often try to establish entry barriers to keep new rms out of th e industry.
However, wh en new rms do enter an industry, it is often because th ey h ave
a different—and p erh ap s better—way to p rovide value to customers. Tock To
Go rst entered th e delivery services market, comp eting with ap p lications like
Uber Eats, Skip Th eDish es, and DoorDash during th e global p andemic. Given
th at restaurants were severely nancially imp acted by th e situation surrounding
COVID-19, and comp etitors were ch arging restaurants 20 to 30 p ercent p er
order, Tock To Go h ad a different strategy. Th ey offered rates signi cantly
below th e 20 or 30 p ercent standard and with out commission fees. Furth er,
unlike comp etitors, Tock To Go does not h ave couriers to deliver meals but
rath er asks customers to p re-order food and h elp s restaurants arrange th eir
own delivery. 29 New entrants can ch ange th e “rules of th e game” in an industry.
Sub stitute s
At times, the biggest opportunity or threat in an industry is not from direct competition but from buyers substituting other products. In the telephone industry,
for example, people are increasingly disconnecting their landline phones and
instead using their mobile phones and VoIP (Voice Over Internet Protocol) services, such as Skype. This implies that rms may need to adjust their employee
skill bases to support different technologies, or they may need to think about
how they will compete in different ways.
Sup p lie rs
Organizations rarely create everything on their own but instead have suppliers
that provide them with key inputs. These inputs can include raw materials for
production, money (from banks and stockholders), information, and people. This
last factor—people, or la bou r, as it is historically called—has direct implications
for strategic planning and HRP.
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Stake ho ld e rs
Stak eh old er s are key people and groups that have an interest in a rm’s activities and can either affect them or be affected by them. The term goes beyond
the ve forces described above. A rm’s primary stakeholders include its investors, employees, customers, suppliers, and creditors. Primary stakeholders have a
direct stake in the rm and its success. A rm’s secon da r y sta keholder s have less
of a stake but nonetheless can affect or be affected by the company. Secondary
stakeholders include the community in which the rm operates, the government,
business groups, and the media.
Firms must analyze and balance the interests of their various stakeholders.
For example, laying off employees will often result in lower costs for a rm, at
least in the short term. But if the cuts are too severe and affect a rm’s service,
for instance, customers are likely to suffer, as will investors and creditors. The
community could suffer as well. One way a rm attempts to balance the interests of their shareholders is by determining how a strategic action is likely to
impact each group. For which group is the action critical? For which group is
the action less critical? The rm may want to involve, or at least consult, primary shareholders in major strategic actions. In contrast, secondary stakeholders
can be monitored and informed. So, for example, if a rm is considering developing a new product, its suppliers, creditors, and employees should de nitely
be involved and consulted about the move. Secondary stakeholders, such as the
community and the media, can merely be informed about the new strategy when
appropriate and their responses monitored.
stakeholders
Key people and groups that have an interest
in a rm’s activities and that can either
affect them or be affected by them
H R’s Ex t e r n a l Su p p ly o f L a b o u r
Sources of information about the changes in a rm’s remote and competitive
environments, particularly the external supply of labour, are invaluable for both
operational and strategic reasons. HRP must focus on both. At an operational
level, labour-supply changes directly affect hiring plans in the area where the
organization is located or plans to locate. Similarly, with a “maturing” workforce,
HRP must consider the implications for recruitment and replacement policies.
Other “barometers” of the labour market include migration in and out of the area
and the mobility of the population, the rm’s demand for speci c skills, unemployment rates, educational level of the workforce, government labour regulations, and so on. To be closer to younger, educated workers, who will lead them
into the digital future, as well as high-earning consumers, large companies such
as Motorola, Yahoo, and others that moved to the suburbs decades ago have
been relocating to the cities or opening satellite of ces there. Time will tell if this
strategy will continue post-COVID-19.
Labour market analysis is aided by various published documents. Statistics
Canada and Employment and Social Development Canada/ Human Resources and
Skills Development Canada publish many studies on the labour force, as do
various provincial governments. In addition, local chambers of commerce and
city planning departments can assist both large organizations and new business
ventures by providing them with a labour market analysis of their areas. Offshore
consulting rms such as IBM and Accenture can be a good source of information
about labour trends in other countries.
Part of conducting an external labour analysis includes gauging the talent
in your own industry—in other words, looking at the comp etitive environment
for labour. What schools are the top candidates being recruited from? What
rms are attracting the most candidates and why? What rms end up hiring
the best candidates and why? Astute HR managers who track their rms’ hiring
and recruiting metrics relative to the comp etition are an invaluable source of
external labour “intelligence” such as this. Attending industry conventions and
talking to your comp any’s sup p liers about business and emp loyment trends are
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other good ways of gathering comp etitive intelligence. So are interviews with
job candidates. Simp ly asking candidates who turned down job offers why they
did so can yield a great deal of information. We will talk more about this aspect
of HR in Chapter 5.
Check In
In the current environment, with the government, organizations, and people still struggling with
the COVID-19 pandemic, what external factors in the environment do you think would be the most
important for rms to monitor? How can an HR manager help the executive team get a fuller picture of the competitive environment in which an organization operates?
Learning Outcome 3
Understand why it is important for an
organization to do an internal resource
analysis.
St e p 3 : In t e r n a l A n a ly s is
When you decided on your major, you not only had to look at careers that were
in demand, you also had to take a hard look at yourself and what you’re good at
relative to other p eop le. For examp le, p etroleum engineers make a lot of money
and are in great demand. But do you have what it takes to become one? Similarly,
organizations also analyze their own strengths and weaknesses.
C o r e C a p a b ilit ie s
core capabilities
Integrated knowledge sets within an
organization that distinguish it from its
competitors and deliver value to customers
value creation
What the rm adds to a product or service
by virtue of making it; the amount of
bene ts provided by the product or service
once the costs of making it are subtracted
58
A growing number of experts now argue that the key to a rm’s success is based
on establishing a set of cor e cap ab ilities—bundles of people, processes, and
systems that distinguish an organization from its competitors and deliver value
to customers.
You can think of valu e cr eation as a cost/ bene t scenario. For example,
what is driving, or would drive, a customer’s willingness to buy from your rm
versus another? What bene ts do, or would, customers get from your rm relative to the costs they incur? In what areas does your organization excel as far as
potential customers are concerned? Most rms recognize that there is a small set
of three to six core capabilities that are most critical to differentiating them from
competitors. Core capabilities can consist of a combination of three resources:
(1) processes, (2) systems (technologies), and (3) people.
Processes are “recip es” or standard routines for how work will be done
and what results will be accomp lished. For examp le, when executives at
Intermountain Healthcare (IHC), a hosp ital and clinic chain, analyzed the rm’s
cap abilities, they found that less than 10 p ercent of its p rocesses accounted for
over 90 p ercent of the cost, time, and quality of p atients’ healthcare. These were
selected as the p rocesses on which the organization would focus to enhance its
core cap abilities.
Top-notch systems are also part of the core capabilities equation. They
include information systems, databases, proprietary technologies, and the like.
For example, great systems and technologies are a core capability of Amazon—
one that has resulted in a signi cant competitive advantage for the rm.
Last, but certainly not least, p eop le are a key resource that underlies a rm’s
core cap abilities. Particularly in knowledge-based industries such as the software and information services industries, success dep ends on “p eop le-embodied
know-how.” This includes the knowledge, skills, and abilities of emp loyees most
critical for executing the rm’s p lan to create the most value for customers and
whose skills are dif cult to rep licate or rep lace.
As a result, a number of comp anies th at p reviously relied on standard
p lans for recruiting and managing th eir emp loyees are designing more tailored
p lans to address th e individual needs of emp loyees so th at th ey will be in a
better p osition to h elp imp lement th eir rms’ strategies. Microsoft goes so far
as to ask certain typ es of emp loyees to design th eir own career p ath s. For
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examp le, th e comp any offers software engineers both a management-focused
and tech nical sp ecialist career track and allows th em to move back and forth
between th e two.
Su s t a in in g a C o m p e t it iv e A d v a n t a g e
t h r o u g h P e o p le
Organizations can achieve a sustained competitive advantage through people if
they are able to meet the following criteria 30:
1. The resou rces mu st be va lu a ble. People are a source of competitive
advantage when they improve the ef ciency or effectiveness of the
company. Value is increased when employees nd ways to decrease costs,
provide something unique to customers, or some combination of the two.
To improve the bottom line, RBC and Enbridge are among the companies
that use employee empowerment programs, total quality and continuous
improvement efforts, and exible work arrangements to motivate and spark
the creativity of their workers.
2. The resou rces mu st be ra re. People are a source of competitive advantage
when their knowledge, skills, and abilities are not equally available to
competitors. Companies such as Microsoft and Four Seasons Hotels
therefore invest a great deal to hire and train the best and the brightest
employees to gain an advantage over their competitors.
3. The resou rces mu st be dif cu lt to imita te. People are a source of
competitive advantage when the capabilities and contributions of a rm’s
employees cannot be copied by others. Disney, Southwest Airlines, and
Starbucks are each known for creating unique cultures that get the most
from employees (through teamwork) and are dif cult to imitate.
4. The resou rces mu st be or ga n ized. Peop le are a source of comp etitive
advantage when their talents can be combined and dep loyed to work
on new assignments at a moment’s notice. Comp anies such as IBM
and GE have invested in information technology to help allocate and
track emp loyee assignments to temp orary p rojects. Teamwork and
coop eration are two other p ervasive methods for ensuring an organized
workforce.
These four criteria highlight the importance of people and show the closeness of HRM to strategic management.
Typ e s o f Tale nt and The ir Co m p o sitio n in the W o rkfo rc e
A related element of internal analysis for organizations th at comp ete on cap abilities is determining th e comp osition of th e workforce. As we h ave indicated,
managers need to determine wh eth er p eop le are available—internally or externally—to execute an organization’s strategy. Managers must make tough decisions about wh om to emp loy internally, wh om to contract externally, and how
to manage different typ es of emp loyees with different skills wh o contribute in
different ways to th e organization. Th e Province of British Columbia recognizes
th e value of h uman cap ital as described in High ligh ts in HRM 2.2.
Figure 2.3 shows that different skill groups in any given organization can be
classi ed according to the degree to which they create strategic value and are
unique to the organization. This gure shows the departments for an Australian
biotechnology rm and the quadrants those groups fall into, as well as their
gradual migration given a strategic organizational shift to one that focuses on
customer service. As a general rule, managers often consider contracting externally (or outsourcing) skill areas that are not central to the rm’s core competence. HRP plays an important role in helping managers weigh the costs and
bene ts of using one approach to employment versus another.
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Highlights in HRM 2.2
The M e asure m e nt o f H um an Cap ital
The Of ce of the Auditor General of British Columbia recognized
that human capital is critically important to the delivery of highquality service to the province’s citizens. So, it set out to measure whether training and development (T&D) were being used
to increase human capital in the BCpublic service. As a rst
step, it de ned human capital as the collective brainpower in an
organization. This brainpower consists of
●
facts acquired through informal and formal education;
●
skills gained through training and practice;
●
●
●
experience gained through re ection on past successes
and mistakes;
value judgments based on individual perceptions; and
social networks developed through relationships with
coworkers, colleagues, and customers.
The audit took several measures, including a large-scale
survey of a random sample of full-time employees and an indepth audit of three ministries. Some of the data generated by
this audit are the following:
●
●
●
Thirty-six percent of government employees had received
no formal training.
The average BC government employee received 17 hours of
training (compared to a Canadian benchmark of 29 hours).
Less than one percent of payroll was spent on training
(compared to the four percent that the best employers
spend).
●
●
●
Forty percent of employees had had their jobs rede ned.
Forty-three percent of senior managers would reach age
55 in the next 5 years and be eligible to retire.
Thirty-three percent of employees with less than one year
of employment did not feel they had been properly trained
to carry out their duties.
The audit revealed that most T&D decisions were based
on requests made from individual employees and that most
programs they attended consisted of one- and two-day
courses outside the organization. It had never been ascertained whether these courses increased employees’ skills or
helped the organization achieve its goals. There was neither
a way of knowing how effective this training was, nor was
there any accounting for T&D expenditures. Government
employees generally believed that training was of great
value to them and their organizations. Paradoxically, they
also believed that they were not being supported in their
work, and only half thought they had the tools and resources
they needed to do their jobs.
More recently, the Vancouver Board of Trade established
a task force to focus on the gap between labour supply and
demand. The issues on the table included Canada’s skills
shortages, the underutilization of immigrants, the need for
more training programs in BC, and the largely untapped
potential of British Columbia’s First Nations communities.
Sources: Adapted from J. McCannel and L. McAdams, “The Learning Culture in Public Service,” Public Sector Management 11, no. 1 (2000), http://www.ipaciapc.ca, used by permission; Greg Hoestra, “Measuring Human Capital in B.C.,” Sounding Board, March 2014, p. 5.
Evidence from research suggests that employment relationships and HR
practices for different employees vary according to which segment they occupy
in this matrix. Here are some general trends:
●
●
60
Str a tegic kn owled ge wor ker s. Th is group of emp loyees tends to h ave
unique skills th at are directly linked to th e comp any’s strategy and are
dif cult to rep lace (such as research and develop ment scientists in p h armaceuticals comp any or comp uter scientists in a software develop ment
comp any). Th ese emp loyees are typ ically engaged in knowledge work th at
involves considerable autonomy and discretion. Comp anies tend to make
long-term commitments to th ese emp loyees, investing in th eir continuous
training and develop ment and p erh ap s giving th em an equity stake in th e
organization.
Core employees. This group of employees has skills that are quite valuable to a company but are not particularly unique or dif cult to replace (such as salespeople in
a department store or truck drivers for a courier service). These employees tend
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F ig u r e 2 .3
High
M ap p ing H um an Cap ital
Complementary
Complementary
Strategic
Strategic
D A
C B
R&D
Partners
Management
R&D
Partners
Diagnostics
R&D
Partners
Sales
Mfg
MIS
UNIQUE
Legal
HR
Management
HR
Diagnostics
Finance
Sales
Laboratory
Services
Customer
Service
Quality
Finance
Distribution
Low
Manufacturing
Operations
Customer
Service
Support
Support
Low
Core
Core
VALUE
High
to be employed in traditional types of jobs. Because their skills are transferable,
it is quite possible that they could leave to go to another rm. As a consequence,
managers frequently make less investment in training and development and tend
to focus more on paying for short-term performance achievements.
●
●
Su ppor tin g wor ker s. Th is group of emp loyees typ ically h as skills th at are
of less strategic value to th e rm and are generally available in th e labour
market (such as clerical workers, maintenance workers, and staff workers
in accounting and HR). Individuals in th ese jobs are increasingly h ired
from external agencies on a contract basis to sup p ort th e strategic knowledge workers and core emp loyees. Th e scop e of th eir duties tends to be
limited, and th eir emp loyment relationsh ip s tend to be transaction based,
focused on rules and p rocedures, with less investment in develop ment.
Eth ics in HRM describes some issues associated with contract emp loyees.
Th e Business Case outlines th e advantages to th e emp loyer of h iring con tract labour.
Exter n a l pa r tn er s. This group of individuals has skills that are unique but frequently are not directly related to a company’s core strategy (such as lawyers
and consultants). Although companies perhaps cannot justify their internal
employment, given their indirect link to strategy, these individuals have skills
that are specialized and not readily available to all rms. As a consequence,
companies tend to establish longer-term alliances and partnerships with them
and nurture an ongoing relationship focused on mutual learning. Considerable
investment is made in the exchange of information and knowledge.31
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Alexi Rosenfeld/ Getty Images Entertainment/ Getty Images
Delivery drivers are core employees
of the human capital architecture at
FedEx.
C o r p o r a t e C u lt u r e
cultural audits
Audits of the culture and quality of work life
in an organization
Think about our initial discussion (in Step 1) of mission, vision, and values.
Because managers increasingly understand that their employees are critical to
their success, they often conduct cu ltu r al au d its to examine the values, assumptions, beliefs, and expectations of their workforces as well. Can they make a difference in a rm’s strategy? Yes. Cultural audits can help rms decide on the strategic
investments necessary to build and sustain a culture. The audits can also be used
to determine whether the cultures of two companies will complement each other
should the rms merge. As we will discuss later, many a merger has failed due to
corporate “culture clashes” between companies that tried to join forces.
Ethics in HRM
The Em p lo ym e nt Co ntrac t
The number of organizations substituting part-time workers for
full-time employees is growing. Employees—even those with
excellent track records and many years of service—are considered expendable as organizations revise their strategies to
become more competitive and more pro table. When yet another
reorganization occurs, management reveals the new plan with
excitement. However, although management thinks it is telling
employees, “We will provide you with meaningful, challenging,
and skill-building work that will be good for your résumé—you
are responsible for your own employment,” employees are
hearing, “We will work you to the bone, pay you enough to prevent you from quitting, and re you when we no longer need you.
Oh, and by the way, you are our most valuable resource.”
62
Some employment contracts are extremely one-sided,
with employers determining when to hire and when to re,
without obligation or guilt. This kind of contract works when
people need jobs more than organizations need employees.
However, as some sectors continue to experience rapid
growth, and as the labour market for certain skills becomes
tighter, employees are making contractual demands that
place them in the driver’s seat. They are demanding signing
bonuses, stock equity, retention bonuses, and suf cient
noti cation with predetermined buyouts for termination.
Furthermore, the courts are ruling that if an employee is
retained for a series of uninterrupted contracts, then that contract worker is de facto an employee.
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The Business Case
H ir in g C o n t r a c t W o r k e r s Pa y s
An employer can save a lot of money by hiring only contract
employees. The use of contract workers has the additional
bene ts of functional exibility (employers can hire the workers
with the exact skills needed) and numerical exibility (workers
can be added or discharged as work demand uctuates).
Contract workers (also called temporary workers or “temps”)
are de ned as paid workers with a speci ed end date for
their job or completion of a task or project. The number of
temporary/contract workers has grown to a record 2 million
Canadians, an increase of 50 percent over the last 20 years.
By comparison, the number of permanent jobs increased by
33 percent over the same period. The sectors with the most
temporary jobs included education, health care, and social
assistance. Over 25 percent of jobs in education were temporary, followed by healthcare and social assistance at 13 percent
combined. Further, women were more likely than men to have
casual, short-term, or contract jobs, whereas men were more
likely to have seasonal jobs.
While recent changes in employment standards legislation
in Ontario will force employers to rethink how they use contract
workers (see Chapter 3), employers want to hire people on contract for several reasons:
●
The employer has the ability to terminate their contracts
easily.
●
There is no obligation to pay bene ts.
●
The need for training and development investments is reduced.
●
●
●
●
●
Less pay is required because contract workers rarely
bene t from seniority provisions.
Typically, contract workers are not entitled to paid sick
leave or vacation pay.
There is no obligation on the part of the employer to pay
into a pension plan.
Typically, contract employees do not participate in company incentive compensation programs that award merit
pay or bonuses.
Contract workers can be used for specialized and seasonal
support.
A growing organization must decide whether to hire fulltime or part-time employees. The chart below will assist in this
decision.
Advantages and Limitations of Part-Time Employment
Advantages for the Employer
Work scheduling exibility
Reduced compensation costs
Increased ability to add/reduce programs
Faster termination process
Focus on merit over seniority
Can be used as a screening device for future
permanent employment
Advantages for the Employee
Control over personal time/work–life balance
More variety in jobs
Home of ce tax advantages
Autonomy
Gain broad experience
May t personal situation
Flexibility
Limitations for the Employer
Reduced organizational loyalty
Costs of continuous replacement
Costs of continual training
Strategic employees can quit
Dif culty attracting top talent
Reluctance to speak up
Culture of stability harder to maintain
Limitations for the Employee
Little or no job security
Limited bene ts
Stresses of continuous learning
Lack of training and career progression
Lower incomes
Experience may be of limited value
Sources: Adapted from Parisa Nikfargam, The Difference between Full-Time Employee and Contract Worker,” Toronto Metro (September 3, 2013), http://www.
metronews.ca/features/talentegg/2013/09/03/the-difference-between-full-time-employee-vs-contract-worker.html, retrieved April 4, 2018; Amanda Silliker,
“More Firms Hiring Contract Workers,” Canadian HR Reporter 25, no. 9. (2012): 1, 13; Helmar Drost and H. Richard Hird, An Introduction to the Canadian Labour
(Continued )
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Market, 2nd ed. (Scarborough, ON: Thomson Nelson, 2006); Barbara Moses, “Loss of Loyalty Cuts Both Ways,” The Globe and Mail (November 6, 1997): B17;
R. S. Echlin, “Courts Apply Smell Test in Judging Contract Workers as Long Term Employees,” The Globe and Mail (November 22, 1999): B1, http://www.theglobeandmail.com/report-on-business/economy/jobs/canadas-shift-to-a-nation-of-temporary-workers/article11721139/; Samantha Gluck, “Bene ts of Contract
Employment,” Chron Magazine, https://smallbusiness.chron.com/employer-pay-social-security-tax-contracted-employee-18866.html, retrieved July 26, 2021;
Rajeshni Naidu-Ghelani, “Number of Temp Workers Jumped by 50% in Last 20 Years, StatsCan Says,” CBC (May 14, 2019); Julie Ritzer Ross, “Should You Hire
At-Will Employees?” Business News Daily (September 24, 2020); Alexandra Levit, “Should You Expand Your Contract Workforce? It Depends,” Forbes (September
21, 2018); Arne L Kalleberg. Good Jobs, Bad Jobs: The Rise of Polarized and Precarious Employment Systems in the United States, 1970s–2000s. Russell Sage
Foundation, 2011; Jörg Felfe, Renate Schmook, Birgit Schyns, and Bernd Six, “Does the Form of Employment Make a Difference? Commitment of Traditional,
Temporary, and Self-Employed Workers,” Journal of Vocational Behavior 72, no. 1 (2008): 81–94; Sylvia Fuller and Natasha Stecy-Hildebrandt, “Lasting
Disadvantage? Comparing Career Trajectories of Matched Temporary and Permanent Workers in Canada,” Canadian Review of Sociology/Revue canadienne de
sociologie 51, no. 4 (2014): 293–324.
Co nd uc ting a Cultural Aud it
To conduct a cultural audit, a rm generally surveys its employees to learn how
they feel about a number of issues by asking them questions such as: How is
business conducted within your organization? How do people communicate with
one another? How are con icts and crises resolved? Lisa Gordon, for example,
the head of Atlanta Habitat for Humanity, used a cultural audit for employees and
found that employees’ scores on diversity, equity, and inclusion were higher than
those of the trainers.32
To p revent legal and eth ical breach es, some rms conduct cultural audits
th at ask emp loyees questions about th e degree of fear associated with meeting
th eir rms’ revenue goals and incentive p lans th at could encourage uneth ical
or illegal beh aviour. 33 Cultural audits can also be used to determine wh eth er
th ere are different group s, or subcultures, with in th e organization th at h ave
distinctly different views about th e nature of th e work and h ow it sh ould be
done.
Th e cultural audit conducted by SAS, a business-analytics corp oration th at
often ranks No. 1 on For tu n e magazine’s “Best Comp anies to Work For” list,
includes detailed questions about th e comp any’s p ay and bene t p rograms
and a series of op en-ended questions about th e comp any’s h iring p ractices,
internal communications, training and recognition p rograms, and diversity
efforts. 34
Perhap s the most widely used cultural audit questionnaire is the Organizational
Culture Assessment Instrument (OCAI), develop ed by Kim Cameron and
Robert Quinn. The questionnaire help s identify four distinct typ es of corp orate
cultures:
●
●
●
●
The “clan” culture, in which employees are closely knit and exhibit great
concern for one another and their customers, and loyalty and cohesion are
highly valued. Starbucks’ culture can be categorized as a clan culture. Many
small and medium-sized businesses fall into this category too. Their HR strategies are more informal and focused on creating a family-type feel that binds
employees emotionally to the organization.35
The “adhocracy” culture, which is a culture characterized by risk taking,
innovation, and a sp irit of entrep reneurship . Google clearly ts into this
category.
The “market” culture, which encourages competitive, result-oriented behaviours. Investment banks that closely focus on achieving their nancial numbers are an example of rms with market cultures.
The “hierarchical” culture, which is characterized by formal structures and
procedures and in which ef ciency and stability are greatly valued. Utilitytype companies and well-established companies such as railroads fall into
this category.
Some cultures lend themselves more readily to some strategies than others.
However, almost all rms have elements of each of the four cultures.
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Fo r e c a s t in g
An internal analysis of an organization can reveal a great deal about where it
stands today. However, things change. In an important sense, strategic planning
is about managing that change. Managers must continually forecast both the
needs and the capabilities of the rm for the future to do an effective job at strategic planning. As shown in Figure 2.4, managers focus on (at least) three key
elements: (1) forecasting the demand for labour, (2) forecasting the supply of
labour, and (3) balancing supply and demand considerations.
Con sid er, for a momen t, th e h igh costs of n ot forecastin g—or forecastin g
p oorly. If job vacan cies are left u n lled , th e resu ltin g loss in ef cien cy can
b e very costly, p articu larly w h en you con sid er th e amou n t of time it takes
to h ire an d train rep lacemen t emp loyees. As p oin tless as it may sou n d , we
h ave seen situ ation s in w h ich emp loyees are laid off in on e d ep artmen t w h ile
ap p lican ts are h ired for similar job s in an oth er d ep artmen t. Poor forecastin g
th at lead s to u n n ecessary layoffs also makes it d if cu lt for emp loyees to
accu rately assess th eir ow n career p rosp ects an d d evelop men t. Wh en th is
h ap p en s, some of a rm’s more comp eten t an d amb itiou s workers w ill b e
in clin ed to seek oth er emp loymen t w h ere th ey feel th ey w ill h ave b etter career
op p ortu n ities. 36
On th e p lus side, accurate forecasting p rovides th e kind of information
managers need to make sound decisions. It can h elp th em ensure th at th ey
h ave th e righ t number and righ t kinds of p eop le in th e righ t p laces at th e
righ t times, doing th ings th at p rovide value to both th e organization and th e
emp loyees.
F ig u r e 2 .4
M o d e l o f H R Fo re c asting
BALANCING
SUPPLY AND DEMAND
FORECASTING DEMAND
Considerations
Techniques
Product/ service demand
Economics
Technology
Financial resources
Absenteeism/ turnover
Organizational growth
Management philosophy
Trend analysis
Managerial
estimates
Delphi technique
Shortage
Utilize overtime
Add full-time workers
Add part-time workers
Employ contract
workers
Recall employees
Outsource work
Reduce employee
turnover
Techniques
External Considerations
Staffing tables
Markov analysis
Skills inventories
Management
inventories
Replacement charts
Succession planning
Demographic changes
Education of workforce
Labour mobility
Government policies
Unemployment rate
Surplus
Reduce employees’
work hours
Implement a hiring
freeze
Lay off employees
Offer employees early
retirement
FORECASTING SUPPLY
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Fo re c asting a Firm ’s De m and fo r Em p lo ye e s
trend analysis
Aquantitative approach to forecasting
labour demand based on an organizational
index such as sales
If a key comp onent of forecasting is p redicting the number and typ es of p eop le
that an organization needs to meet its objectives, the question remains: “How
can this be done?” A variety of factors, including a rm’s comp etitive strategy,
technology, structure, and p roductivity, can affect the demand for labour.
External factors such as business cycles—economic and seasonal trends—can
also p lay a role. For examp le, retailers such as Hudson’s Bay and Canadian Tire
rely heavily on temp orary emp loyees between November and January. There
are two ap p roaches to HR forecasting: quantitative and qualitative, which we
discuss next.
Qu a n tita tive a ppr oa ches. Quantitative approaches to forecasting involve the
use of statistical or mathematical techniques. One example is tr en d an alysis,
whereby a rm’s employment requirements are forecasted on the basis of some
organizational index.
Other, more sophisticated statistical planning methods include modelling or
multiple predictive techniques. Whereas trend analysis relies on a single factor
(such as sales) to predict employment needs, the more advanced methods combine several factors, such as interest rates, gross national product, disposable
income, and sales, to predict employment levels. Factors such as a rm’s strategy
and “what if” scenarios can also be incorporated in the analysis. For example,
if the rm wants to increase its sales by 10 percent, how many additional salespeople should it hire? Forecasting methods such as these are usually used by
larger companies with the help of analysts and statisticians. However, advances
in data collection technology and computer software are making it easier and
more affordable for smaller businesses to use more sophisticated forecasting
techniques.
Qu a lita tive a ppr oa ches. Admittedly, forecasting is frequently more an art
th an a science, p roviding inexact ap p roximations rather th an absolute results.
Th e ever-ch anging environment in wh ich an organization op erates contributes
to th is situation. For examp le, estimating changes in th e demand for a rm’s
p roducts or services is a basic forecasting concern, as is anticip ating ch anges
in national or regional economics. A rm’s internal ch anges are critical too. For
martin-dm/ E+/ Getty Images
External factors such as business
cycles—economic and seasonal
trends—can play a role in
forecasting the demand for and
supply of employees.
6
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examp le, a community h osp ital anticip ating internal ch anges in its tech nology
or h ow th e facility is organized or managed must consider th ese factors wh en
forecasting its staf ng needs. Also, th e forecasted staf ng needs must be in line
with th e organization’s nancial resources.
In contrast to quantitative ap p roach es, qualitative ap p roach es to forecasting
are less statistical. Man ag em en t fo r ecasts are th e op inions (judgments) of
sup ervisors, dep artment managers, exp erts, or oth ers knowledgeable about
th e organization’s future emp loyment needs. Anoth er qualitative forecasting
meth od, th e Delp h i tech nique, attemp ts to decrease th e subjectivity of forecasts by soliciting and summarizing th e judgments of a p reselected group of
individuals. HR p ersonnel can do th is by develop ing a list of questions to ask
th e managers in th eir comp anies. High ligh ts in HRM 2.3 contains a list of
good questions to ask. Th e nal forecast th us becomes a collective, or group ,
judgment.
Ideally, forecastin g sh ould in clude th e use of both quan titative an d qualitative ap p roach es. Numbers with out con text—in cludin g th e con text sup p lied
by skilled HR p rofession als wh o un derstan d th e busin ess an d can an alyze
an d in terp ret th e data—are less useful. Jacquelin e Rich ardson , CNA Fin an cial
Corp .’s assistan t vice p residen t for cen tral region HR, exp lain s th at a critical
asp ect of forecastin g is “th e ability to combin e th e use of data an d th e core
skills th at HR p eop le h ave as ‘p eop le p eop le.’” Rich ardson furth er says, “bein g
able to look at data, n ot just in terms of wh at h ap p en ed in th e p ast but as a
p rogn osticator of wh at could h ap p en in th e future, becomes really imp ortan t
in HR circles an d in busin ess circles. It’s wh at our busin ess strategists do
all th e time, so it’s a real n atural for HR. It grabs our leaders’ atten tion an d
gives us more credibility.” Th e main focus sh ould be on discoverin g tren ds as
op p osed to bein g occup ied with p roducin g exact n umbers. For examp le, in
strategic workforce p lan n in g, large comp an ies review “job families” an d n ot
every sin gle job. 37
management forecasts
The opinions (judgments) of supervisors,
department managers, experts, or others
knowledgeable about the organization’s
future employment needs
Highlights in HRM 2.3
H RP and Strate g y Que stio ns to Ask B usine ss M anag e rs
Workforce planning requires that HRleaders periodically interview their managers to gauge future workforce needs. Here are
some sample questions to ask:
7. What are the barriers to optimally achieving the strategy?
1. What are your mission, vision, and values?
9. Which skills should we have internally versus contract
with outside providers?
2. What are your current pressing business issues?
3. What are our organizational strengths?
4. What are our competitors’ organizational strengths? How
do we compare?
5. What core capabilities do we need to win in our markets?
6. What are the required knowledge, skills, and abilities we
need to execute the winning strategy?
8. What types of skills and positions will be required or no
longer required?
10. What actions need to be taken to align our resources with
strategy priorities?
11. What recognition and rewards are needed to attract,
motivate, and retain the employees we need?
12. How will we know whether we are effectively executing
our workforce plan and staying on track?
Source: Adapted fromAgilent Technologies for The Conference Board and the Society for Human Resource Management.
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Fo re c asting the Sup p ly o f Em p lo ye e s
staf ng tables
Graphic representations of all organizational
jobs, along with the numbers of employees
currently occupying those jobs and
future (monthly or yearly) employment
requirements
Markov analysis
Amethod for tracking the pattern of
employee movements through various jobs
quality of ll
Ametric designed to assess how well new
hires are performing on the job
skill inventories
Files of personnel education, experience,
interests, and skills that allow managers to
quickly match job openings with employee
backgrounds
Just as an organization must forecast its future requirements for employees, it
must also determine whether suf cient numbers and types of employees are
available to staff the openings it anticipates having. As with demand forecasts,
the process involves both tracking current employee levels and making future
projections about those levels.
Sta f n g ta bles and Ma rkov a n a lysis. An internal sup p ly analysis can begin
with the p rep aration of staf ng tables. Staf n g tab les are grap hic rep resentations of all organizational jobs, along with the numbers of emp loyees currently occupying those jobs (and p erhap s also future emp loyment requirements
derived from demand forecasts). Another technique, called Mar k ov an alysis,
shows the p ercentage (and actual number) of emp loyees who remain in each of
a rm’s jobs from one year to the next, as well as the p rop ortions of those who
are p romoted, demoted, or transferred or exit the organization. As Figure 2.5
shows, a Markov analysis can be used to track the p attern of emp loyee movements through various jobs and to develop a transition matrix for forecasting
labour sup p ly.
Forecasting the supply of human resources available to a rm requires that its
managers have a good understanding of employee turnover and absenteeism. We
have included formulas for computing turnover and absenteeism rates in an online
appendix to this chapter called Calculating Employee Turnover and Absenteeism.
Also included in the appendix is a formula for calculating a new metric called
qu ality of ll. It was developed because managers understand that simply having
“bodies” in place is not enough. The quality-of- ll metric attempts to measure
how well new hires are performing so that the company will have enough top
performers to propel it toward its strategic objectives. We will show you how it is
calculated in Chapter 5 when we discuss recruiting metrics.
Skill in ven tor ies and ma n a gemen t in ven tor ies. Staf ng tables, a Markov analysis, and turnover rates tend to focus on the n u mber of employees in particular
jobs. Other techniques are more oriented toward the types of employees and their
skills, knowledge, and experiences. Sk ill in ven tor ies can also be prepared that
list each employee’s education, past work experience, vocational interests, speci c abilities and skills, compensation history, and job tenure. Well-prepared and
F ig u r e 2 .5
H yp o the tic al M arko v Analysis fo r A Re tail Co m p any
2019
2018
Store
Managers
Store Managers
(n = 12)
11
Assistant Store
Managers (n = 36)
4
Asst. Store
Managers
Section
Managers
Dept.
Managers
2
30
11
Department
Managers (n = 288)
41
Transition percentage
68
92
14
63
8
29
207
6
46
86
1,066
288
Sales Associates
(n = 1,440)
15
Exit
1
Section
Managers (n = 96)
Forecasted Supply
Sales
Associates
301
1,072
351
Actual number of employees
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up-to-date skill inventories allow an organization to quickly match forthcoming
job openings with employee backgrounds. When data are gathered on managers,
these inventories are called ma n a gemen t in ven tor ies.
Repla cemen t cha r ts a n d su ccession pla n n in g. Both skill and management
inventories—broadly referred to as ta len t in ven tor ies—can be used to develop
employee r ep lacem en t ch ar ts, which list current jobholders and identify possible replacements should openings occur. Figure 2.6 shows an example of how
an organization might develop a replacement chart for the managers in one of
its divisions. Note that this chart provides information on the current job performance and promotability of possible replacements.
A replacement chart can be used side by side with other pieces of information
for su ccession p lan n in g—the process of identifying, developing, and tracking
talented individuals so that they can eventually assume top-level positions.
In a study conducted by the Society for Human Resource Management, three
out of four chief executives said that succession planning was their most signi cant challenge for the future. A Conference Board of Canada survey of HR
managers found that organizations had internal candidates that were job ready
to replace senior executives less than half the time.38 Software developers are
responding to this need with new succession planning and talent management
software. Software developer Taleo, for example, offers an application based on a
rm’s organizational chart and baseball card-like representations of its employees.
replacement charts
Listings of current jobholders and people
who are potential replacements if an
opening occurs
succession planning
The process of identifying, developing,
and tracking key individuals for executive
positions
F ig u r e 2 .6
An Exe c utive Re p lac e m e nt Chart
KEY
MANAGER
J. L. Green
A/2
ASSISTANT TO
MANAGER
L. B. Martinez
B/1
ASSISTANT
MANAGER
R. G. Gorton
T. M. Brown
DIVISION HR
MANAGER
C. K. Broderick A/1
NORTHWEST
REGION
MANAGER
L. C. Green
A. T. Tupper
A/2
B/3
Names provided are
replacement candidates
A. Promotable now
B. Needing development
C. Not fitted to position
1. Superior performance
2. Above-average
performance
3. Acceptable
performance
4. Poor performance
ACCOUNTING
DIVISION MANAGER
PLANNING DIVISION
MANAGER
W. Shepard
B. Verkozen
T. Turner
C/2
A/1
B/1
N. T. Lyman
B/3
CENTRAL REGION
MANAGER
NORTH CENTRAL
REGION MANAGER
EASTERN REGION
MANAGER
J. Q. Gomez
D. K. Lim
O. D. Morris
A/1
B/2
B/3
A/2
C/4
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TECHNICAL
ADVISOR
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Clicking on the cards ips them over to show statistics about the employees, such
as their individual performance review data, career information, and succession
data. Similarly, the consulting rm Accenture developed a Facebook-like application listing its employees, where they are based, and their individual areas of
expertise. The application helps managers with deployment decisions and makes
it easier for Accenture’s employees who do not necessarily know each other or
work together to collaborate with one another.
HR managers frequently lament that they have trouble keeping managers,
including CEOs, focused on succession planning. It’s possible that because CEOs
are increasingly being recruited from the outside, they are less concerned with
internal succession planning than they are in “bringing in their own people.”
And, of course, because the workforce is becoming increasingly mobile, some
managers wonder why they should develop employees internally who may eventually leave the organization when they can recruit quali ed talent from the outside. Small businesses have particular dif culties in planning for succession, as
described in Highlights in HRM 2.4.
Highlights in HRM 2.4
Lac k o f Suc c e ssio n Planning Thre ate ns Fam ily B usine sse s
Sisters Craigie and Debbie Zildjian are the 14th-generation
leaders of Zildjian Cymbal Company, brothers Mark and
Massimo Brooke are the 15th-generation leaders of John
Brooke & Sons, and father-and-son team Toshitaka and
Masakzu Kongo are the 50th- and 51st-generation leaders
of Kongo Gumi of Japan. A certain mystique exists about
family businesses being carried on for generations, yet the
reality revealed in PricewaterhouseCoopers’ Family Business
Worldwide Survey is that many family businesses fail because
they lack a succession plan. For example, according to a
recent study, although many Canadian businesses are family
owned, a quarter of these companies continue to exist into the
second generation, and just 11 percent survive into the third. It
may take the death of a colleague or a sudden illness for business owners to realize that, like a will, they need a succession
plan to keep a business going, continue to provide for their
families, and keep their workers out of the unemployment line.
Yet, as many as 33 percent of family businesses in Canada
have no succession plan. In comparison, 50 percent of family
businesses in Canada claim that they only have an informal
succession plan in place. John Hughes, the managing partner
for Growth Enterprises at Deloitte Canada, explained, “They
may have a sense of who’s coming up through the ranks, but
that isn’t really a plan.” The companies do not list a designated successor for the CEOor president at 54 percent of the
companies surveyed. From the companies that do list one, it is
formally recognized in only 13 percent of cases.
70
Business owners are sometimes reluctant to put succession plans in place for fear of relinquishing control. “Business
owners may be reluctant to face the issue because they do
not want to relinquish control, feel their successor is not ready,
have few interests outside the business, or wish to maintain
the sense of identity work provides,” explains Dr. Al Agamy, an
executive director with the Family Business Center at IMD, an
international business school based in Switzerland.
Sometimes the next generation is just not enthusiastic
about joining the family business. Consequently, it is not advisable to force a family member into the situation. Rather, family
businesses must seek ways of bringing the new generation in.
Yet, founders of the family business may also face a predicament in deciding which offspring should be the successor.
Thus, choosing and grooming the right successor
are key. J. Davis, speaking on successor development at
the International Family Enterprise Institute, recommends
looking for a successor with the following qualities: one
who knows and loves the nature of the business; one who
knows their own strengths and weaknesses, having learned
them through education and previous experience; one who
wants to lead and serve; one who has earned the respect of
other stakeholders; one who knows when to turn to trusted,
knowledgeable advisors for guidance; and one whose skills
and abilities t the strategic needs of the business. Michelle
Osry, the Deloitte partner who leads the rm’s Canadian
Family Business Advisory practice, notes, “In the absence of
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formal agreements, a succession event tends to become a
crisis event. We encourage families to consider a number of
key questions ahead of such events: How can family members exit the business or ownership group? To whom can
they sell? How do you ensure a fair valuation or shareholder
interests? How do you deal with disabilities? How does the
family deal with spousal ownership? Who gets to vote, and
who has a voice in key ownership decisions?”
Even with a business owner willing to relinquish the
reins and a well-chosen successor waiting in the wings,
an actual transition plan—transparent and known to all
involved in advance—is still required. “[Any transition]
needs to be carried out without causing any alarm to the
other stakeholders—that is, nanciers who may be worried
that such a change may increase rm-speci c risk,” says
Mahate. “Suppliers may be concerned about providing future
credit facilities or even doing business with the company.
Customers may be fearful of long-term relationships with the
company. Therefore, it is in everyone’s interest to have an
orderly change to the new structure.”
Now more than ever, in a rapidly changing business
environment, succession planning is integral. Lydia Forte, the
third generation of the family who created Rocco Forte Hotels
in the United Kingdom, explained, “The fast pace of change
in today’s world, with some industries growing and others
waning at speeds that we have not seen before, coupled with
the increasingly competitive nature of the business makes
managing and driving family businesses forward every more
competitive.” Additionally, Leon Fear, a second-generation
director of UK-based international property investors stated,
“Without doubt, we are living through a period of great uncertainty and that shoulders a burden on many next generation
business leaders to protect and grow a successful family
legacy, but with that does come opportunity for those who
believe that to be the case and who focus on where those
opportunities are in a changing world.”
Sources: “Next in Line: The Advantages of Succession Planning,” Forbes (July 30, 2013), http://www.forbes.com; “Canada’s Banks Eye Succession Plans for
Boomers,” Reuters (December 20, 2012), http://www.reuters.com; Manoj Nair, “Succession Planning Is the Key,” gulfnews.com (January 19, 2011), http://
gulfnews.com; Ernesto J. Poza, Family Business (Mason, OH: South-Western/Cengage Learning, 2010): 85–89; Don Schwerzler, “Family Succession Plan First,”
http://www.family-business-experts.com/family-succession-plan.html; Canadian Business, “Don’t Let Your Family Destroy Your Business,” (January 22, 2015);
Canadian Business, “Too Many Family Businesses Have No Succession Plan,” (September 19, 2014); James Beech, “Next Generation Anxious Over Succession
of Family Fortunes,” Campden FB (September 7, 2020).
A s s e s s in g a Fir m ’s H u m a n C a p it a l
Re a d in e s s : G a p A n a ly s is
Once a comp any has assessed both the sup p ly and the demand for emp loyee
skills, talent, and know-how, it can begin to understand its h u m an cap ital
r ead in ess. Any difference between the quantity and quality of emp loyees
required versus the quantity and quality of emp loyees available rep resents a gap
that needs to be closed. Figure 2.7 shows how PharmaCo, a sp ecialty chemical
manufacturing comp any, ap p roaches its assessment of human cap ital readiness.
Similar to our discussion in the p receding sections, managers begin by identifying a comp any’s core cap abilities and the key p eop le and p rocesses that are
critical to those cap abilities. PharmaCo’s executive team identi ed 8 key job
“families” that comp rise about 100 emp loyees of the rm’s 1,500-member staff
(in other words, less than 10 p ercent of its workforce). For each of these critical
job families, managers identi ed the critical knowledge, skills, and behaviours
necessary to build the core cap abilities. They then determined the number of
p eop le required for these p ositions, as well as the number of p eop le who are
currently quali ed.
As the lower portion of the gure shows, the company’s human readiness
ranged between 0 percent for supply-chain management design specialists and
75 percent for call centre representatives.
Once the assessment of the rm’s human capital readiness is complete, managers have a much better foundation for establishing their strategy going forward
and the speci c requirements for developing the talent needed to implement the
strategy.39
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human capital readiness
The process of evaluating the availability of
critical talent in a company and comparing it
to the rm’s supply
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F ig u r e 2 .7
Asse ssing a Firm ’s H um an Cap ital
VALUE
PharmaCo
PROCESSES
Bioscientists
COMPETENCIES
Lead
Optimization
PEOPLE
DISCOVERY
Required
Qualified
HC
Readiness
DEVELOPMENT
Pre-clinical
Manufacture
Clinical Trial
Design
Predictive
Science
Personalized
Medicine
OPERATIONS
Branding
Packaging
Sales/Mkt
Distribution
Patient Insight
Pharmacists
Toxicologists
Chemists
COMM
Clinician/
Physicians
SCM
Specialists
Chem/Mech
Engineers
Brand Team
Leader
Brand
Marketers
Chemical &
Mechanical
Engineering
------------Production
Design
Testing &
Analysis
Operations
Management
-------------Detail
Orientation
Brand and
Market
Knowledge
Disease Areas
-------------Project
Management
-------------Leadership
Collaboration
Results
Orientation
30
15
320
50
20
15
255
91%
62%
100%
79%
Disease Area
-------------Experimental
Design
Results
Interpretation
-------------Analytical
Thinking
Strategic
Thinking
Collaboration
Chemistry
-------------Molecular
Design
Protein
Synthesis
-------------Analytical
Thinking
Collaboration
ResultsOrientation
Toxicology
------------Pharmacology
Molecular
Toxicology
-------------ProblemSolving
ResultsOrientation
Collaboration
Disease Area
------------Clinical Trial
Design
Results
Interpretation
-------------Communicate
Collaboration
Formulation
-------------Analytical
Chemistry
Process
Chemistry
Scale Up
-------------Analytical
Thinking
325
125
25
55
206
85
20
63%
68%
80%
Source: Strategy Maps: Converting Intangible Assets into Tangible Outcomes by Robert Kaplan and David Norton, 2006. Copyright © 2006 by the Harvard
Business School Publishing Corporation.
Check In
Think about the issues facing P zer and Moderna. How did they assess their ability to rapidly enter
new markets? Do you think they looked rst at new markets and then the capabilities of their
employees and external partners or vice versa?
Learning Outcome 4
Explain the linkages between competitive
strategies and human resources.
72
St e p 4 : Fo r m u la t in g St r a t e g y
Think once again about your education, your major, and your career choices. After
you looked at possible careers, the opportunities they presented, and your ability
and desire to do them, you probably had to formulate a strategy for pursuing one
of them by choosing a college. When you graduate, you will have to formulate a
strategy for successfully landing a job in your eld in a certain locale you want to be
in. Similarly, after managers have analyzed the internal strengths and weaknesses
of the rm, as well as external opportunities and threats, they have the information
they need to formulate corporate, business, and HR strategies for the organization.
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A comp arison of str en gths, wea kn esses, oppor tu n ities, and thr ea ts is referred
to as a SWOT an alysis. A SWOT analysis help s executives summarize the major
facts and forecasts derived from external and internal analyses. Strategy formulation builds on SWOT analysis to use the strengths of the organization to cap italize on op p ortunities, counteract threats, and alleviate internal weaknesses. In
short, strategy formulation moves from simp le analysis to devising a coherent
course of action. Figure 2.8 is an examp le of a SWOT analysis done for Liz
Claiborne, the fashion-ap p arel comp any.
SWOT analysis
Acomparison of strengths, weaknesses,
opportunities, and threats for strategy
formulation purposes
C o r p o r a t e St r a t e g y
A rm’s corporate strategy includes the markets in which it will compete, against
whom, and how. Corporate strategy focuses on domain selection, that is, the
markets in which it will compete. Some rms choose a concentration strategy
that focuses on only a limited portion of the industry. For example, Visteon
Corporation specializes in electronics, climate, and powertrain technologies for
the automotive industry. In contrast, Henry Ford at one time had fully integrated
his company from the ore mines needed to make steel all the way to the showrooms where his cars were sold.
Gro w th and Dive rsi c atio n
Emerging and growing companies execute their strategies differently than mature
companies or those in decline. As companies grow, their strategic choices tend
to focus on geographic, volume, and product expansion. HRP is a vital input to
these decisions. Growth hinges on three related elements: (1) increased employee
productivity, (2) a greater number of employees, and (3) employees developing
or acquiring new skills. Thus, a rm’s staf ng, training, and employee motivation
efforts can either enable the company to grow or limit its potential.
As companies diversify into new businesses, managers are inevitably faced with
a “make or buy” decision. That is, should they develop the capabilities in-house or
contract externally? For example, when IBM entered the personal computer market
F ig u r e 2 .8
An Exam p le o f a SW OT Analysis fo r Liz Claib o rne
Strengths
Weaknesses
●
brand recognition
●
changing consumer needs
●
understanding customer needs
●
highly competitive market
●
new product lines
●
long lead time bringing new styles to market
●
advertising scheme
●
clothing line is complete success or costly mistake
●
product diversi cation strategy
●
tailor to changing needs, preferences, and lifestyles
Opportunities
Threats
●
overseas markets
●
key competitors
●
worldwide advertising
●
strict government regulations
●
entering the large-size consumer market
●
changing shopping patterns
●
designing mix-and-match out ts
●
quota restrictions
●
men’s sportswear
Source: “Liz Claiborne SWOTAnalysis,” WikiSWOT, http://www.wikiswot.com.
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in the early 1980s, it contracted with (start-up companies) Intel and Microsoft to
make the hardware and operating systems for its personal computer (PC). The
decision did not rest solely on HR issues, but they were an important part of
the equation. Interestingly, IBM got out of the PC business altogether in 2005 by
selling its PC product lineup to Chinese computer manufacturer Lenovo. Today,
IBM develops custom technology services for businesses, which it believes will be
more pro table in the long run and a harder product for competitors to imitate. To
help accomplish this new strategy, the company spent the rst part of the decade
buying up dozens of business-service related companies and their talent.
Some companies diversify far beyond their core businesses. GE, for example,
has diversi ed from its original base in electrical and home appliance products
to such wide-ranging industries as health, nance, insurance, truck, and air transportation, and even media with its ownership of NBC. To manage such a diverse
portfolio, GE has invested heavily in the development of general management
skills and leadership ability.
M e rg e rs and Ac q uisitio ns
Canada has seen a host of mergers and acquisitions in recent years, including the
merger of Loblaws and Shoppers Drug Mart. However, some mergers do not go
well (measured by return on investment, shareholder value, and the like). Often,
the failure is due to cultural inconsistencies, as well as con icts among the managers of each rm. The failure of the merger between the German rm DaimlerBenz (the manufacturer of Mercedes-Benz vehicles) and Chrysler is an example.
Although the German portion of the rm had superior technology, reportedly,
it was less than eager to share its know-how with its American counterparts.
Problems such as this point directly to the importance of effective HRP prior
to—and during—the merger process.
Strate g ic Allianc e s and Jo int Ve nture s
Sometimes rms do not acquire or merge with another rm but instead p ursue
coop erative strategies such as a strategic alliance or joint venture. Esp ecially
when rms enter into international joint ventures, the issues of culture (both
comp any culture and national culture) become p aramount. On the front end, HR
p lays a vital role in assessing the comp atibility of cultures and p otential p roblems. As the alliance is formed, HR help s select key executives and develop s
teamwork across the resp ective workforces. In addition, HR is typ ically involved
in the design of p erformance assessment and mutual incentives for the alliance.
B u s in e s s St r a t e g y
Whereas we think about corp orate strategy as domain selection, business
strategy is viewed in terms of domain navigation. It is more focused on how
the comp any will comp ete against rival rms to create value for customers.
Comp anies can increase the value they offer customers by decreasing the costs
of their goods and services or by increasing the bene ts their p roducts p rovide
(or some combination of the two). Their business strategies re ect these choices.
Lo w - Co st Strate g y: Co m p e te o n Pro d uc tivity
and Ef c ie nc y
A low-cost stra tegy means keeping your costs low enough that you can offer
an attractive price to customers (relative to competitors). Organizations such as
McDonald’s have been very successful at using a low-cost strategy. Critical success factors for this strategy focus on ef ciency, productivity, and minimizing
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waste. These types of companies often are large and try to exploit economies of
scale in production and distribution. In many cases, their large size allows them
to sell their products and services at a lower price, which leads to higher market
share, volume, and (it is hoped) pro ts. However, even a low-cost leader must
offer a product or service that customers nd valuable. As Gordon Bethune, the
former CEO of Continental Airlines, put it, “You can make a pizza so cheap that
no one will buy it.”40 Ultimately, organizations need to use a cost strategy to
increase value to customers rather than take it away.
A low-cost strategy has several links to HRP. The rst has to do with productivity. A common misconception about low-cost strategies is that they inevitably
require cutting labour costs. On the contrary, there are several good examples of
companies that pay their employees “top dollar” but gain back cost advantages
because of excellent productivity. That is, they get a terri c “bang for the buck.”
Either they produce more from the workforce they have, or they can produce the
same amount with a smaller workforce.
According to Peter Cappelli, who heads the Center for Human Resources at
the Wharton School of the University of Pennsylvania, the productivity of the
best-performing staffs can be up to 20 times higher than the productivity of
the worst-performing staffs, depending on the industry. Billy Beane, the general
manager of the Oakland A’s, became famous for making the most of the team’s
small payroll. Beane did so by carefully choosing and developing players and
using them more strategically than other major league teams with bigger payroll
budgets. The movie Mon eyba ll tells this story and provides some interesting
examples of HR strategy and practices.
The second way that low-cost strategies are linked to HR pertains to outsourcing. In some cases, companies seeking low costs may consider contracting
with an external partner that can perform particular activities or services as well
as (or better than) at a lower cost. This decision directly links strategic planning
to HRP. Decisions such as these often result in layoffs, transfers, and the like.
As noted previously, organizations need to have a clear understanding of their
core processes and skills to make these decisions. Too often, rms approach outsourcing decisions based on costs alone, but this can lead to detrimental effects
in the long run if the skills base of their employees suffers and their core capabilities are subsequently eroded.
A low-cost strategy has been found to decrease the positive relationship
between HPWS and employee performance, human resource performance, and
organizational performance.41 Further, in a study of mid-level marketing managers, it was found that organizations using a low-cost strategy scored lowest
on Selection, Training, Appraisal, Salary, and Bene ts compared to other business strategies.42 However, HPWS and solid HR practices are still invaluable for
organizations pursuing a low-cost strategy.43 MIT professor Zeynep Ton, in her
book, The Good Jobs Stra tegy: How the Sma r test Compa n ies In vest in Employees
to Lower Cost a n d Boost Pr o t, explains that an organization can assume a lowcost strategy while still promoting investment in employees. Organizations
can emphasize employee empowerment. This way, employees are included in
decision-making, have a voice in the organization’s strategic vision, and bring
ideas to management. Investing in employees within an organization with a lowcost strategy can also include cross-training, highlighting its commitment to its
employees and ensuring organizational ef ciency.44
In the study of mid-level marketing managers, it was also reported that organizations using a low-cost strategy had the highest score for Job-Based Pay and
the lowest score for Merit Pay across all rms. Thus, it appears as though marketing employees within the low-cost strategy rms are chie y evaluated on
seniority and the degree to which they carry out speci c tasks rather than outcome-based nancial performance measures.45 Organizations must ensure that
the rm’s competitive strategy and its corresponding HR practices are aligned
with the organization’s objectives.
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Before an organization selects a low-cost strategy, there should also be consideration of the rm’s overall strategic p lan and vision. Given that the emphasis
is on p roducing goods or services as ef ciently as p ossible, the organization
seldom leads p roduct or service develop ment.46 Hence, research has found that
a low-cost strategy will negatively affect the organization’s en trepren eu r ia l or ien ta tion , which is de ned as an organization’s strategy-making p ractices, managerial viewp oints, and organizational behaviours that are entrep reneurial in nature.
If an organization p ursues an entrep reneurial orientation and a low-cost strategy,
there will be a strategic mis t. This lack of t is caused by a mismatch between
the entrep reneurial orientation’s objectives of innovativeness, p roactiveness, and
risk-taking and the low cost-strategy’s stress on high levels of ef ciency, cost
control, and nominal discretionary investments.47
Diffe re ntiatio n Strate g y: Co m p e te o n
Uniq ue Value Ad d e d
After the 2008 nancial crisis, there was an increased rivalry from emerging
economies. It therefore became unsustainable for some organizations to practice
a low-cost leadership strategy, including many leading global organizations such
as Eastman Kodak, Goodyear, Timken, Nokia, General Motors, General Electric,
and Joanne Fabrics. A new generation of innovative leaders at these organizations endeavoured to convert their business-level strategy from a low-cost leadership strategy to a product differentiation strategy.48
A differentiation strategy provides something unique and distinctive to customers. It is often based on high product quality, innovative features, speed to
market, or superior service. Four Seasons Hotels’ commitment to quality and
luxury, FedEx’s focus on speed and exible delivery, Holt Renfrew’s commitment
to fashion and customer service, and Apple’s emphasis on innovation and product
development are all easily identi able examples of differentiation strategies.
An organization can differentiate itself by offering rm-sp eci c training, a
strong climate, total comp ensation and bene ts, and work–family balance.49 Each
of these strategies is rooted in the management of human resources. Emp loyees
are a crucial resource and an integral source of comp etitive advantage. Without
employee commitment, organizations cannot successfully imp lement a differentiation strategy and reap the bene ts of HPWS.50 Comp anies that focus on
service, for examp le, need to identify and sup p ort ways to emp ower emp loyees
to serve customers better. In contrast to the comp any that emp hasizes low cost
and ef ciencies, you may nd that differentiating comp anies will bend the rules
a bit more, allow more exibility to let you “have it your way,” and customize
p roducts and services around the customer’s p articular needs. In p lace of rigid
rules, service-oriented companies often try to embed their values in the cultural
values of the comp any. Nordstrom’s emp loyee handbook consists of just a single
ve-by-eight-inch card that reads: “Welcome to Nordstrom. Rule #1. Use your
good judgment in all situations. There will be no additional rules.”
Compared to the low-cost strategy, which was said to have a strategic misalignment with entrepreneurial orientation, a differentiation strategy can better
support the objectives of entrepreneurial orientation. Therefore, there is a better
entrepreneurial orientation– rm performance relationship with a differentiation
strategy, thus highlighting that it is essential to consider the competitive strategy
when setting rm innovation and risk-taking objectives.51
It is also important to note that the competitive strategy must align with the
local marketplace and the human resource system. For example, without skilled
and knowledgeable employees, a business would nd it dif cult to pursue a differentiation strategy. Further, to successfully apply a differentiation strategy, it is
necessary for employees to be suf ciently trained, educated on the competitive
business strategy, and rewarded for producing new and unique ideas based on
the business model.52
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Fu n c t io n a l St r a t e g y : En s u r in g A lig n m e n t
In addition to formulating corporate- and business-level strategies, managers also
need to “translate” strategic priorities into functional areas of the organization
(such as marketing, manufacturing, and HR). This involves all aspects of the
business, but in particular there needs to be a clear alignment between HR and
the requirements of an organization’s strategy. In this regard, HR policies and
practices need to achieve two types of t: vertical and horizontal.53
Ve rtic al Fit/ Alig nm e nt
Ver tica l t (or a lign men t) focuses on the connection between the business objectives and the major initiatives in HR. For example, as we noted earlier, if a company’s strategy focuses on achieving low cost, its HR policies and practices need
to reinforce this idea by emphasizing ef cient and reliable behaviour on the part
of employees and enhanced productivity. On the other hand, if the organization
competes through innovation and new product development, then its HR policies and practices would be more aligned with the notion of fostering creativity
and exibility.
H o rizo ntal Fit/ Alig nm e nt
In addition to vertical t or alignment, managers need to ensure that their HR
practices are all aligned with one another internally to establish a con guration
that is mutually reinforcing; this is hor izon ta l t (or a lign men t). The entire range
of the rm’s HR practices—from its job design, staf ng, training, performance
appraisal, and compensation—needs to focus on the same workforce objectives.
Unfortunately, often one HR practice, such as training, might be focused on teamwork and sharing, whereas another HR practice, such as the rm’s appraisal or
compensation programs, reinforces the idea of individual achievement. Valeant
Pharmaceuticals (VRX) faced this very situation. Centerbridge Partners, a large
holder of the company’s bonds, informed Valeant that it would call a default on
the Canadian pharmaceutical company. The stated source of the problem was
that executive compensation plans paid executives based on metrics that did not
zoranm/ E+/ Getty Images
The use of part-time employees
helps contain labour costs at
fast-food restaurants.
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align with the company’s overall goals and the investor’s best interests in mind.
The company was paying executives for performance that did not generate actual
cash ows, ultimately leading to such executives allegedly running the business
into the ground.54
Check In
Think about a company that you enjoy doing business with and one that you don’t. What competitive strategy does each pursue? Do you think employees of these companies have the right skills
given the strategy? Do you detect any mismatches?
Learning Outcome 5
Understand what is required for a rm to
successfully implement a strategy and
assess its effectiveness.
St e p 5 : St r a t e g y Im p le m e n t a t io n
As the old saying goes, “well begun is half done”—but only half. Like any plan,
formulating the appropriate strategy is not enough. Managers must also ensure
that the new plans are implemented effectively. This is easier said than done.
Strategy implementation is dif cult for organizations as well. One survey of
over 400 global CEOs found that the ability to execute a strategy was their organization’s most signi cant challenge. Two-thirds of the organizations struggled to
execute their strategic vision.55 There is also often a signi cant amount of confusion
regarding the difference between strategy, implementation, and execution. To some
business leaders, the semantics do not seem to matter. However, without a thorough
understanding of the distinction, it can foster poor decision-making and act at all
levels of an organization. Thus, the strategy to execution gap is an enduring issue.56
Figure 2.9 shows the now classic 7-S framework and reveals that HRM is
instrumental to almost every asp ect of strategy imp lementation, whether it p ertains to structure, systems, style, skills, staff, or shared values. In the “Hard S”
category is the stra tegy, which lays out the route that the organization will
F ig u r e 2 .9
The 7- S M o d e l
Structure
Shared
values
Systems
Hard Ss
Strategy
Style
Skills
Soft Ss
Staff
Source: “McKinsey 7-SFramework” from in Search of Excellence: Lessons FromAmerica’s Best Run Companies
byThomas J. Peters and Robert H. Waterman, Jr. Copyright © 1982 byThomas J. Peters and Robert H. Waterman,
Jr. Reprinted by permission of HarperCollins Publishers.
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take in the future; the organizational str u ctu r e is the framework in which the
activities of the organization members are coordinated. If the strategy requires
emp loyees to be reorganized or redep loyed, HR will be intimately involved.
Also in the “Hard S” category are systems and processes. These include formal
and informal procedures that govern the everyday activities of a rm. As organizations redesign their processes to implement their strategies, HR managers need to
help ensure that the best work ow models are in place and that employees share
their advice about the changes too. As with strategy development, employees can
be the source of valuable ideas about how work processes should be structured.
In the “Soft S” category are sha red va lu es, or core values, which were discussed earlier in the chapter as a guiding parameter for strategic planning. They
relate to implementation as well. Strategic change often requires employees and
managers to modify, or abandon, their old ways of doing things. HR managers
play a central role as guardians of the corporate culture—the principles on which
the company is founded and the fundamental ideas around which the business
is built. This is tightly connected to the issue of style, which refers not only to
the leadership approach of top managers but also the way in which employees
present themselves to the outside world (to suppliers, customers, and so on).
Skills and sta ff relate directly to HRM because at its most basic level, HR’s role
in the strategy implementation process is to reconcile (1) human resources
demanded and (2) human resources available.
Ta k in g A c t io n : Re c o n c ilin g Su p p ly a n d D e m a n d
Through HRP, organizations strive for a proper balance between demand considerations and supply considerations. Demand considerations are based on
forecasted trends in business activity. Supply considerations involve determining
where and how candidates with the required quali cations can be found to ll
a rm’s vacancies.
In an effort to meet their HR demands, organizations have many staf ng
options, including hiring full-time employees, having current employees work
overtime, recalling laid-off workers, using temporary or contract employees, and
outsourcing or offshoring some of their business processes.
De aling w ith Surp lus Em p lo ye e s
Several options are available to employers when it comes to dealing with surplus
employees: layoffs, attrition, and termination.
La yo ff St ra t e g ie s
Employee layoff decisions are usually based on seniority and/ or ability. With unionized organizations, the criteria for determining an employee’s eligibility for layoff
are typically set forth in the collective agreement. Although it has become customary
for employers to recognize seniority in unionized employees, nonunion employees
are not always given the same consideration. Due to the demand for a technically
skilled workforce, the ability of employees to change jobs and learn new skills, as
well as their performance and competencies, is given a great deal of weight in layoff
decisions. The most important reason for using seniority as a basis for layoffs is the
objective nature of the decision: number of years of work, not perception of ability,
is the basis for the decision. The system is fair, and employees themselves can calculate their own probability of being employed. Highlights in HRM 2.5 illustrates the
effects of the COVID-19 pandemic on the job situation in Canada.
One of the major disadvantages of overemphasizing seniority is that less
competent employees receive the same rewards and security as more competent
ones; the seniority system ignores talent and effort. The payroll is also higher
than under other systems because more experienced workers tend to earn more
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Highlights in HRM 2.5
COVID- 19 and the Lab o ur Surp lus
“The economic shock of the COVID-19 pandemic caused
Canada’s working-age employment rate to go from record
highs to record lows in a matter of weeks,” Finance Minister of
Canada Chrystia Freeland explained. Freeland also noted that the
“sudden economic contraction” was the most signi cant since
the Great Depression. In April 2020, Statistics Canada reported
that around 500,000 people between the ages of 15 and 24 lost
their jobs. In July 2020, it was stated that over 30 percent of
the workforce lost their jobs entirely or had their hours signi cantly reduced. Though months later, jobs began to be added
to the economy, as of October 2020, 636,000 jobs still had not
returned, and 433,000 workers had less than half the hours they
worked before the pandemic. By July 2021, Canada remained
246,000 jobs, or 1.3 percent, short of pre-pandemic employment
levels, and threats still existed within the economy, especially
with the fear of future infection waves resulting from emerging
new virus variants. Further, in July, the number of people deemed
long-term unemployed was 244,000 higher than pre-pandemic
and accounting for 27.8 percent of total unemployment.
Within some industries, it is expected that the jobs will
never return. For example, many service-sector and energy
companies do not anticipate returning to the pre-COVID
employment levels. The study also found that workers within
the banking industry had the highest fear of losing their jobs
in the history of the bank’s survey. Workers across sectors had
the lowest level of rated expectations for nding new work
since the 2015 oil-price shock. CIBC senior economist Royce
Mendes explained, “When we look out on the horizon, the way
the economy might look when it’s fully healed will be very different than it looked pre-pandemic.”
Sources: Tara Deschamps, “Economy Added 94,000 Jobs in July, Largely in the Services Sector,” CTVNews (August 6, 2021); Meagan Gillmore, “Federal Supports
Through COVID-19: Did They Work?” OHS Canada (February 3, 2021); Robin Levinson-King, “Coronavirus Economy: ‘I’m Just Looking for Whatever I Can Get’,” BBC
News (August 5, 2020); The Canadian Press, “Bank of Canada Survey Says Business Hiring Plans Remain Muted Due to the Pandemic,” CTVNews (July 6, 2020).
money. Also, the practice of using seniority as the basis for deciding which
workers to lay off may well have a disproportionate impact on women and visible minority workers, who often have less seniority than other groups.
Under the umbrella of layoff strategies are several work-reduction options:
reduced workweek, reduced shifts, and transfers to related companies. Under the
reduced workweek, employees work about 20 to 30 hours per week. This option
allows the organization to retain a skilled workforce and lessens the nancial and
emotional impact of a full layoff, while at the same time reducing the costs of
production. Reduced shift work is based on a similar concept of reducing costs
by reducing the number of hours worked. Some plants operate three shifts a day
and may shut down the midnight to 8:00 a.m. shift to save money. In some rare
cases, organizations can transfer laid-off employees to a sister company. Layoffs
are the fastest way to achieve workforce reduction; attrition is the slowest.
A t t rit io n
attrition
Anatural departure of employees from
organizations through quits, retirements,
and deaths
hiring freeze
Apractice whereby new workers are not
hired as planned or workers who have left
the organization are not replaced
80
Attr ition refers to the “natural” departure of employees through quits, retirements, and deaths. The turnover rates of an organization vary greatly by industry
and by occupation. For example, university professors rarely quit, whereas turnover among fast-food workers can reach 300 percent a year. Most organizations
can easily estimate how many people will leave the organization and so can
slowly reduce the workforce through natural means.
Attrition must be supplemented by other practices. Hiring freezes are usually
implemented at the same time as the organization adopts a strategy of workforce
reduction through attrition. A h ir in g fr eeze means that organizations will not
hire new workers as planned or will hire only in areas critical to the success of
the organization.
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Some organizations attempt to accelerate attrition by offering incentives to
employees to leave. These incentives include cash bonuses for people to leave
during a speci ed time, accelerated or early retirement bene ts, and free outplacement services. However, the buyout process must be carefully managed.
Employees with valuable skills who can easily nd another job may be the rst
to cash in.
If the surplus of employees is deemed to be permanent, terminations may be
the only option.
Te rm in a t io n St ra t e g ie s
Ter m in ation is a practice initiated by an employer to separate an employee from
the organization permanently. Termination is different from ring, in which an
employee is released for such causes as poor performance, high absenteeism,
or unethical behaviour. The purpose of termination is to reduce the size of the
workforce and thereby save money.
A termination strategy begins with the identi cation of employees who are in
positions that are no longer considered useful or critical to the company’s effectiveness. Employers cannot terminate without some form of compensation to the
employee. Sever an ce p ay, a lump-sum payment given to terminated employees,
is calculated on the basis of years of service and salary. Every province has
legislation such as the Employmen t Sta n da rds Act, which establishes minimum
standards for termination and severance pay.
Check In
Why is it dif cult to translate a rm’s strategy into HRdeliverables that get the job done? What part
of this endeavour do you think HR managers struggle with the most?
St e p 6 : Ev a lu a t io n a n d A s s e s s m e n t
You probably know someone who graduated, went to work in a particular eld,
assessed their success (or lack of it) in that eld, and then decided to do something else for a living. The same sort of re-evaluation and assessment is an important function for business as well. At one level, it might seem that assessing a
rm’s effectiveness is the nal step in the planning process. But it is also the
rst step. Planning is cyclical, of course, and although we have somewhat conveniently placed evaluation at the end of this chapter, the information provides
rms with inputs they need for the next cycle in the planning process.
termination
Practice initiated by an employer to
separate an employee from the organization
permanently
severance pay
Alump-sum payment given to terminated
employees by an employer at the time of an
employer-initiated termination
benchmarking
The process of measuring one’s own
services and practice against the recognized
leaders to identify areas for improvement
Learning Outcome 6
Describe how rms evaluate their strategies
and human resources implementation.
Ev a lu a t io n a n d A s s e s s m e n t Is s u e s
To evaluate their p erformance, rms need to establish a set of “desired” objectives as well as the metrics they will use to monitor how well their organization
delivered against those objectives. The objectives can include achieving a certain level of p roductivity, revenues, p ro ts, market share, market p enetration,
customer satisfaction, and so forth. Because strategic management is ultimately
aimed at creating a comp etitive advantage, many rms evaluate their p erformance against other rms. Ben ch m ar k in g is the p rocess of identifying “best
p ractices” in a given area—for examp le, p roductivity, logistics, brand management, and training—and then comp aring your p ractices and p erformance to
those of other comp anies. To accomp lish this, a benchmarking team would
collect information on its own comp any’s op erations and those of other rms
to uncover any gap s. The gap s help determine the causes of p erformance differences, and, ultimately, the team would map out a set of best p ractices that lead
to world-class p erformance. Interestingly, the target comp any for benchmarking
does not need to be a comp etitor. For examp le, when Xerox wanted to learn
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F ig u r e 2 .10
An Exam p le o f an H R Dashb o ard
about excellent customer service, it benchmarked L.L. Bean. By working with
a noncomp eting comp any, Xerox was able to get access to information a comp etitor would not divulge.
The metrics fall into two basic categories: human capital metrics and HR metrics. Human capital metrics assess aspects of the workforce, whereas HR metrics
assess the performance of the HR function itself.
Most larger companies use software to track their HR metrics over time.
Figure 2.10 shows an example of an HR “dashboard,” which is software that
tracks and graphically displays HR statistics so they can be viewed by managers
at a glance (as you do your dashboard readings when you are driving).
Smart HR managers can signi cantly enhance their worth to their organizations if they go a step further by gathering informal information, or “intelligence,”
about the strategic and HRM practices of their competitors. This can be done
by legal means, such as by reading industry blogs, checking competitors’ press
releases, and signing up for their news feeds, checking messages they put out
on Twitter, and following Google email alerts that are triggered when competing
rms’ names appear in the news. Attending industry conventions and talking to
your company’s suppliers about business and employment trends are other good
ways of gathering competitive intelligence.
Gathering competitive intelligence and benchmarking alone will not give a
rm a competitive advantage. A competitive advantage is based on the unique
combination of a company’s human capital, strategy, and core capabilities, which
differ from rm to rm. This means that HR managers cannot simply rely on the
benchmarks and strategies of other rms. Instead, they must develop their own.
If they can successfully do so and implement them, they can achieve a sustained
competitive advantage.57
M e a s u r in g a Fir m ’s St r a t e g ic A lig n m e n t
Earlier in the chapter, we discussed the importance of strategic alignment and
t as an element of strategy formulation and implementation. As an element
of evaluation, some very useful techniques help managers assess the extent to
which they have achieved these objectives.
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Strate g y Alig nm e nt and the B alanc e d Sc o re c ard
One of the tools for mapping a rm’s strategy to ensure strategic alignment is
the b alan ced scor ecar d (BSC). Developed by Harvard professors Robert Kaplan
and David Norton, the BSC is a framework that helps managers translate their
rms’ strategic goals into operational objectives. The model has four related cells:
(1) nancial, (2) customer, (3) processes, and (4) learning.58
The logic of the BSC is rmly rooted in HRM. People management and
learning help organizations improve their internal processes and provide excellent customer service. Internal processes—product development, service, and the
like—are critical for creating customer satisfaction and loyalty; they are also important for ensuring productivity to contain costs for better nancial performance.
Customer value creation, in turn, drives up revenues, which enhances pro tability.
Figure 2.11 shows how this might work at Starbucks. In each cell, Starbucks
would identify the key metrics that help translate strategic goals to operational
imperatives. For example, under customer metrics, Starbucks might look at the
percentage of repeat customers, the number of new customers, and growth rate.
Under people metrics, managers might measure the numbers of suggestions provided by employees, participation in Starbucks’ stock-sharing program, employee
turnover, and training hours spent. Each of these cells links vertically. People
management issues such as rewards, training, and suggestions can be linked
to ef cient processes (e.g., brewing the perfect cup, delivering top-notch customer service). These processes then lead to better customer loyalty and growth.
Growth and customer loyalty in turn lead to higher pro tability and market value.
balanced scorecard (BSC)
Ameasurement framework that helps
managers translate strategic goals into
operational objectives
M e asuring H o rizo ntal Fit
Recall that horizontal t means that HR p ractices are all aligned with one another
to establish a con guration that is mutually reinforcing. Figure 2.12 shows an
examp le of how organizations can assess the horizontal t of their HR p ractices.
F ig u r e 2 .11
B uild ing the M e tric s M o d e l
Strategic Theme:
“ The Third Place”
Long-Term
Shareholder Value
Financial
Grow
Revenues
Customer
Asset
Utilization
Attract & Retain
Customers
Premium
Coffee
The “Third”
Place
Internal
Engage
Cust.
Fill
Orders
People
Baristas
Store
Manager
Objectives
Measures
Initiatives
Intl. growth
Pro tability
Market value
Grow revenues
Revenue
Improve cost
structure
General and
administrative
costs as % of sales
New customers
No. of Customers
New stores
20%
compound
annual
growth rate
(CAGR)
30% CAGR
5% CAGR
20 mill/wk
1,500/yr
More value to
current (now)
customers
Repeat customers
Same store sales
15% 2/wk
13% growth
Friendly service
Customer feedback
Customer
engagement
Accurate orders
First time right
Fast ful llment
Order ful llment
90+
satisfaction
99+%
accurate
<3 mins
Store manager
stability
Average tenure
Mgr >3 yrs
40 hrs training
Voluntary turnover
Barista 80%
MUG awards
Engagement
survey
85% rating
Beanstock
Barista
engagement
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Targets
Cdn. growth
Corp. layoffs
Store develop
New products
Customer
loyalty program
New partners
Automation
Cycle time opt.
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There are essentially three steps. First, managers need to identify the key workforce objectives they hop e to achieve. Often this information can come from
the p eop le/ learning cell of the BSC and might include loyalty, customer service,
p roductivity, and creativity. Second, managers would identify each of the HR
p ractices used to elicit or reinforce those workforce objectives (e.g., job design,
staf ng, training, ap p raisal, comp ensation). Third, managers would evaluate each
HR p ractice on a scale of –5 (not sup portive) to 5 (supp ortive). By tallying up
the ratings across managers, organizations can get a very clear idea of which HR
p ractices are working together to achieve the workforce objectives and which
are not.
Keep in mind that internal t is a necessary, but insuf cient, cause of strategic alignment. A company could have nearly perfect alignment among its HR
practices, but they still might not be aligned with the competitive strategy. For
that reason, it is important for managers to assess both internal t and external
alignment.
F ig u r e 2 .12
Asse ssing H o rizo ntal Fit
Sales
Productivity
Customer
Service
Merchandise
Information
Stock
Maintenance
Total
Cross-functional teams
3
2
0
−1
4
Rotation (depts.)
3
3
−1
−1
4
Test battery
2
2
1
1
6
Select for experience
5
3
2
2
12
4
5
1
1
11
Results appraisal
5
−4
−2
25
26
Individual incentives
5
−5
−3
25
28
Corporate
3
3
1
0
7
Store manager
4
2
2
2
10
Merchandise information
systems
5
2
5
1
13
Daily postings
4
−3
4
21
4
43/55
10/55
10/55
26/55
57/220
Structure/Work ow
Staf ng
Organization
Retail selling skills
Rewards
Leadership
Functional Cohesion
Training
Technologies
System Coherence
+5 = strongly supports the priority
0 = neutral
–5 = strongly counterproductive
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En s u r in g St r a t e g ic Fle x ib ilit y fo r t h e Fu t u r e
Apart from the need to establish and measure t between HR and strategy, HR is
also focused on ensuring exibility and agility when the environment changes.
Ultimately, successful HRP helps increase organ ization al cap ab ility—the
capacity of the organization to continuously act and change in pursuit of sustainable competitive advantage.59
Flexibility can be achieved in two primary ways: coordination exibility and
resource exibility. Coordin a tion exibility occurs through rapid reallocation
of resources to new or changing needs. Through HRP, managers can anticipate
upcoming events, keep abreast of changes in legal regulations, forecast economic
trends, and recognize competitor moves. With advance notice, managers can move
people into and out of jobs, retrain them for new skill requirements, and modify
the kinds of incentives they use. Use of a contingency workforce composed of parttimers, temporary employees, and external partners also helps achieve coordination exibility.60 Resou rce exibility, on the other hand, results from having people
who can do many different things in different ways. Cross-training, job rotations,
and team-based work modes are all focused on establishing a exible workforce.
We will draw on these ideas throughout this text. But at this point, we want
to close the chapter by emphasizing that strategic planning is a process designed
to ensure superior performance today, as well as establishing the capability and
agility to respond tomorrow. As the great hockey player Wayne Gretzky used to
say, “I don’t skate to where the puck is. I skate to where the puck is going to be.”
organizational capability
The capacity of the organization to act and
change in pursuit of sustainable competitive
advantage
Check In
As an HR manager, how would you help your organization to successfully implement overall
strategy and HR strategy?
Small Business Application
Care e r M anag e m e nt
Small businesses, by their size, provide for a much closer alignment between organizational and people strategies. What is
different for small business is threefold: (1) access to resources
to analyze the competitive landscape and market opportunities,
(2) access to internal and available talent to pursue markets or
opportunities, and (3) being less constrained by existing internal
processes or structures in the pursuit of new strategies.
As we have seen, the development and integration of HRin
the strategic planning process requires a scan of market opportunities and the competitive landscape. This research requires
time, money, and expertise that may not be readily available
in small companies. So how do small companies develop and
pursue strategy? Typically, small companies grow around a core
competency; that is, a single business activity that has been
established to address a speci c market need or speci c large
client requirement. From that centre, all research regarding
market opportunities and threats is focused on identifying
opportunities that are aligned with this core competency and
guarding potential threats to the core business.
Let’s use a small printing company with 50 employees as an
example. This company has been created out of a need to provide
printing services to a packaged-goods company. From this, the
company has grown to take on additional clients. However, the
packaged-goods company still accounts for 40 percent of the revenue and pro tability for the company. With this in mind, the strategic planning exercise focuses on the following: (1) What does the
company need to do to grow the business with the existing clients
and identify new clients? (2) What risks are there of client or pro tability erosion from the existing client base? (3) What changes, if
any, are required in the talent the company has in place to sell and
deliver printing services to meet these needs?
The challenge for small business is that by the very nature
of size, the range of talent available within the existing organization will be constrained. As a result, any change in strategic
direction may require retraining or recruitment of talent, both of
which will take time and money and will depend on the availability of training services or talent available to hire. These factors will need to be considered in the development of strategy.
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Summary
Outcome 1 SHRM integrates strategic planning and
HRP. It can be thought of as the pattern of HR deployments and activities that enable an organization to
achieve its strategic goals. The rm’s mission, vision,
and values provide a perspective on where the company is headed and what the organization can become
in the future. Ideally, they clarify the long-term direction of the company and its strategic intent. An HPWS
helps to drive rm performance.
Outcome 2 Analyzing the rm’s external environment
is central to strategic planning. Environmental scanning is the systematic monitoring of major external
forces in uencing the organization, including forces
in the business environment and the competitive environment. Changes in the external environment have
a direct impact on the way organizations are run and
how people are managed. Some of these changes represent opportunities, and some of them represent real
threats to the organization.
Outcome 3 Conducting an internal analysis to gauge
the rm’s strengths and weaknesses involves looking
at a rm’s core capabilities, its talent and composition in the rm, and its corporate culture. An internal
analysis enables strategic decision makers to assess the
organization’s workforce—its skills, cultural beliefs,
and values.HRP is a systematic process that involves
forecasting the demand for labour, performing supply
analysis, and balancing supply and demand considerations. Quantitative or qualitative methods help a rm
identify the number and type of people needed to meet
the organization’s goals.
Outcome 4 After managers have analyzed the internal
strengths and weaknesses of the rm, as well as
external opportunities and threats, they have the information they need to formulate corporate, business, and
HR strategies for the organization. A rm’s corporate
strategy includes the markets in which it will compete,
against whom, and how. The rm’s business strategy
is viewed in terms of domain navigation. It is more
focused on how the company will compete against
rival rms in order to create value for customers. A
rm’s HR strategies and practices should be aligned
with its corporate and business strategies.
Outcome 5 Strategic p lanning decisions affect—and are
affected by—HR functions. Through HR and strategic
p lanning, HR managers can proactively identify and
initiate p rograms needed to develop organizational
cap abilities on which future strategies can be built.
HRP and strategic p lanning tend to be most effective
when there is a reciprocal relationship between the
two p rocesses.
Outcome 6 Formulating an HR strategy is only half of
the HR battle. The strategy must also be implemented.
Employment forecasts must be reconciled against the
internal and the external supplies of labour the rm
faces. This can include having current employees
work overtime; hiring full-time, part-time, or contract
employees; downsizing employees; furloughing them;
and outsourcing or offshoring. If there is a labour
shortage, the rm might have to reformulate its longterm and short-term strategic plans or nd ways to
develop employees “from the ground up.”
Key Terms
attrition, 80
balanced scorecard (BSC), 83
benchmarking, 81
core capabilities, 58
core values, 51
cultural audits, 62
environmental scanning, 53
hiring freeze, 80
human capital readiness, 71
human resources planning
(HRP), 47
86
management forecasts, 67
Markov analysis, 68
mission, 50
organizational capability, 85
quality of ll, 68
replacement charts, 69
severance pay, 81
skill inventories, 68
staf ng tables, 68
stakeholders, 57
strategic human resources
management (SHRM), 47
strategic planning, 47
strategic vision, 51
succession planning, 69
SWOT analysis, 73
termination, 81
trend analysis, 66
value creation, 58
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Discussion Questions
1. As you have learned, substitutes can be an
opportunity or a threat. The smartphone is a great
example of a new product that eliminated the
need for many other products. In groups, develop
a list of the products that the smartphone has
replaced.
2. How has COVID-19 affected the future of
postsecondary education in Canada? List several
impacts and discuss the implications for the
demand for faculty.
3. Think about an organization that you know well.
Place the employees of this organization into the
following categories: strategic knowledge workers,
core employees, supporting workers and partners,
and complementary skills workers.
4. Shopify and Tim Hortons are both Canadian
success stories. From websites and news articles, try
to articulate and compare their corporate strategies.
Try to do a SWOT analysis for one of them.
5. During the semester in which you are enrolled
in this course, there will be news about an
organization needing to reduce the workforce by
thousands of employees. What are the options?
What are the advantages and disadvantages of
each option?
6. Imagine that you are president of the HR student
association at your school. You want to measure
the success of the association during your term.
What metrics would you use? What benchmarks
would you use?
HRM Experience
Custo m izing H R fo r Diffe re nt Typ e s o f H um an Cap ital
Part of strategic planning in HRis mapping an organization’s
human capital. When we look at the strategic value of a person’s
skills and their uniqueness, we soon discover that organizations
comprise different kinds of workers who have very different kinds
of skills. Some are core knowledge workers, some are more traditional job-based employees, some are contract workers, and some
are external partners. In this context, it is unlikely that we would
manage all of these employees in the same way (as much as we
might want to for fairness). There are differences in HRpractices for
different groups. This is not bad, but it makes the job of HRmanagers more dif cult.
Assignment
The following are descriptions of three different employees. How
would you characterize each worker? What role does each play
when it comes to the organization’s strategy?
Sobadia Bascomb is a highly talented computer programmer for Applied Software Solutions. She is among an elite set of
engineers in the computer industry doing leading-edge work on
advanced computer modelling. The rm’s CEO, Bill Ding, believes
the future of the company rests on the innovative work that Sobadia and her team are doing. He worries that someone might lure
her away to work for them, so he wants to give her all the room
she needs to grow and stay committed to the rm.
Calvin Duff is a salesperson on the retail side of the rm.
He has daily contact with customers and is responsible for making sales and communicating with service personnel. Make no
mistake: to many customers, Calvin and his coworkers are the
“face” of the company. Always on the lookout for a better position, Calvin has thought about working for PeachTree Computing,
Applied Software Solution’s main competitor. Other salespeople
have found that they can leave Applied Software Solutions and
get “up to speed” easily at other rms. Their skills are very
transferable, and the transition is not dif cult. Bill Ding and other
managers at the company recognize this fact, so they try to keep
salespeople loyal and productive, recognizing that many of them
do eventually leave.
Chandra Singh is a part-time administrative assistant for
Applied Software Solutions. She handles routine typing and ling
work for the company, particularly in peak periods in the summer
and around the holidays. She usually works for a few weeks at a
time and then takes time off. The executives at the company have
considered either outsourcing her job to an agency or automating
it through a new computer system. But, for now, things are steady.
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Case Study 1
Domino’s Tries to Get Its Strategic Recipe Right
Hand Robot/ Shutterstock.com
Believe it or not, years
ago it was normal for
p eop le to have to
wait an hour or more
to get their p izzas
delivered. But those
were the years B.D.—
Before
Domino’s.
Started by Tom Monahan and his brother in Ypsilanti,
Michigan in the 1960s, Domino’s created a value p rop osition p eop le were hungering for p izza delivered in 30
minutes or less. Better yet, if a Domino’s p izza wasn’t
delivered in 30 minutes, it was free. That was unheard
of in the p izza business.
Monahan changed the pizza industry, not because
Domino’s created a better product but because it was able
to offer a different value proposition than anyone else
was offering, as well as align its people, processes, and
systems to deliver against that promise. Domino’s used
assembly line-based systems and standardized processes
to improve ef ciency and reduce pizza preparation times.
For example, it was the rst to use conveyor-belt oven
technology to ensure uniform temperatures and reduce
baking times. Domino’s also translated its strategy into
HR deliverables by emphasizing and encouraging fast
pizza making and delivery. Annually, the company holds
a “World’s Fastest Pizza Maker” competition in which its
pizza makers compete for cash and other prizes.
As important as what Domino’s did is what it did
not do. Strategy is about making choices. Domino’s
did not focus on great pizza—it focused on fast pizza.
It did not customize every order but prepared them
all in advance. It didn’t hire premiere pizza chefs who
tossed pizza dough into the air to make lighter crusts.
It didn’t use the wood- red stoves to give the pizza an
old-world taste. And it didn’t offer in-store dining.
Each of the ingredients in Monahan’s formula was
aligned around its value proposition of fast delivery—
a strategy that worked well for Domino’s for decades.
This strategy, and a franchise model, helped the company grow by leaps and bounds. Today, there are over
10,000 Domino’s pizza stores located in more than 70
countries around the world.
Over time, however, Domino’s competitive environment changed. Other companies began delivering pizzas
in about 30 minutes, and consumers began wanting more
than fast pizza: they wanted good pizza. The problem
was that Domino’s wasn’t delivering on that score. In
taste tests, customers complained that Domino’s pizzas
tasted like cardboard. At one point, the rm’s customer
satisfaction scores in terms of its food and service were
lower than those of any other pizza chain. Perhaps not
surprisingly, the rm’s stock price re ected as much.
8
To turn things around, the company had to rethink its
value proposition. That included revamping not only its
food but also its HR strategies and policies. One problem
Domino’s suffered from is rampant in the fast-food
industry: employee turnover. Domino’s turnover rate was
158 percent annually. In other words, for every employee
hired during a year, another 1.5 employees quit.
Domino’s CEO at the time, David Brandon, wasn’t
convinced that higher pay for hourly-wage employees
was the solution, however. “If we could have increased
everybody’s pay 20 percent could we have moved the
needle a little bit to buy some loyalty? Maybe, but that’s
not a long-term solution.” Moreover, because most
Domino’s stores are individually owned rather than
corporate owned, the individual owners have to decide
for themselves whether to increase hourly wages.
Instead, Brandon focused on the quality of store
managers—choosing better ones, nding ways to retain
good ones, and coaching them to train and motivate
employees by being respectful and polite. The company also began offering managers stock options for
growing their store revenues.
Store managers cause employees to stick around—or
not, said Rob Cecere, a regional manager for Domino’s.
Employees can go to McDonald’s or Pizza Hut and make
as much as they make at Domino’s. “You’ve got to make
sure they are happy to come to work for you,” Cecere
explained. Domino’s also worked harder to promote a
culture of “fun” via its World’s Fastest Pizza competition
and other initiatives. Brandon thought employees were
so crucial that he renamed the company’s HR department the “People First” department.
HR wasn’t the only part of the recipe Domino’s had
to change, however. It also had to create a new value
proposition for its food. In 2009, it embarked on an
effort and associated marketing campaign it dubbed
the “pizza turnaround” to do precisely that. As part of
the effort, the company developed a new recipe for
its pizza crusts; began using fresher, gourmet types of
ingredients; and began offering new products, such as
artisan pizzas, pasta, and desserts. It also remodelled
stores and added in-store dining.
Domino’s chief strength still lies in its systems
and technology. The biggest department at the rm’s
headquarters in Ann Arbor, Michigan, is its technology
department. The department has built novel applications over the years, such as an online ordering application that allows customers to “build” their pizzas online
and track their preparation, cooking, and delivery times.
The department has also developed mobile apps for 95
percent of the smartphones on the market. Computer
and mobile ordering now make up 40 percent of all
Domino’s sales. In 2011, technology employees built
a popular game called Domin o’s Pizza Her o, which
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challenges players to learn the demanding job of pizza
making and do it fast. Players who are good at the game
are then prompted to apply for jobs with Domino’s.
Is Domino’s new recipe working? By most accounts,
yes. Turnover dropped by more than 100 percent following Brandon’s initiatives. Customer satisfaction
scores have jumped up too. On this score, Domino’s
is now tied for the lead among its competitors in the
pizza business. Wall Street has noticed and rewarded
the rm with an all-time stock price high.
Still, strategy changes and their implementation are
continually evolving challenges for rms, and Domino’s
is no exception. The company still faces issues with its
HR piece of the puzzle and ensuring that its strategy
is aligned all the way down the food chain. In 2011,
the company received a raft of negative publicity
after two Domino’s workers posted a YouTube video
of themselves deliberately contaminating a pizza in
a very disgusting way. In 2013, 20 Domino’s workers
in Manhattan were red for taking part in a nationwide food strike. The workers claimed they were being
paid less than the legal minimum wage. Recently, the
company made news after it asked the European Union
to relax immigration laws so the rm could bring in
unskilled workers from abroad to meet its needs. An
immigration of cial suggested that Domino’s could
solve its problem by paying workers more.
Would paying hourly-wage employees a little more
buy Domino’s a little more loyalty and prevent negative publicity for the company—loyalty its CEO at one
time didn’t think was needed? And if so, would the
costs have be worth the bene ts? And who should
incur these costs since most of the stores are privately
owned? These questions are food for thought, ones that
Domino’s will have to resolve. After all, even with the
best technologies and systems, pizzas don’t cook and
deliver themselves. People do.
Questions
1. Explain how Domino’s strategy differed from its
competitors.
2. Has the rm been able to achieve a long-term strategic t between its strategy and HR practices in
your opinion? Why or why not?
Sources: William James, “Domino’s Pizza Group PLC: UK Minister Tells Domino’s to Pay Higher Wages to Attract Staff,” 4-Traders (December 11, 2013), http://www.4traders.com; David Kretzman, “Why Domino’s Digital Component Is Important,” Motley Fool (December 10, 2013), http://motleyfool.com; “Lawmaker: Domino’s Employees
Were Fired after Complaining about Conditions,” CBS New York (December 8, 2013), http://newwork.cbslocal.com; Erin White, “To Keep Employees, Dominos Decides It’s
Not All about Pay,” The Wall Street Journal (February 17, 2015), http://online.wsj.com.
Case Study 2
How a Strategy Change Led to Nike’s Formation
pio3/ Shutterstock.com
Nike, the world’s most
famous athletic company, didn’t start out
by making Air Jordans.
In fact, it didn’t make
shoes at all. It distributed them. Nike
actually began as company called Blue Ribbon. It was founded in 1964 by Phil
Knight, a runner from Oregon, along with his former
college track coach, Bill Bowerman. At the time, the running shoe market was dominated by the German rms
Adidas and Puma. However, Knight and Bowerman
had become intrigued by new lighter, lower cost running shoes made in Japan. Bowerman had always tinkered with shoe designs to try to make his runners
faster. Meanwhile, Knight had just earned an MBA from
Stanford University and was looking for a way to combine what he loved—sports—with work. So, the two
men each chipped in $500, and began importing and
selling Tiger-brand shoes (now Asics) made by the
Japanese company Onitsuka. Blue Ribbon’s start wasn’t
glamorous. Bowerman and Knight began by selling the
shoes out of their cars at local track meets. But runners
liked the new lighter shoes, and the company started
earning a pro t. Eventually the business did well enough
it was able to hire some employees, most of whom were
passionate runners like the owners.
For about a decade Blue Ribbon’s strategy worked
well. Business grew, and the company even opened its
own store in Santa Monica, California. But by 1971, the
rm was facing a crisis. Bowerman wanted Onitsuka to
make a lighter shoe he had designed. Onitsuka wasn’t
interested. Moreover, Knight believed Onitsuka was
looking for other distributors to cut Blue Ribbon out
of the business. What did Knight and Bowerman do?
They designed their own shoe called “the Nike” and
began selling it. Executives at Onitsuka were enraged
by the move. They immediately stopped selling shoes to
Blue Robbin and sued it to boot. At that point, it looked
like it might be the end of the road for Blue Ribbon.
There wasn’t much of a market for the Nike shoes yet.
The company was still young and in debt, and a lawsuit
would be expensive to ght. Knight gave Blue Ribbon’s
employees the bad news. But instead of throwing in the
towel, he laid out a new vision and mission for the rm:
“This is the moment we’ve been waiting for,” Knight
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recounts telling them in his bestselling book, Shoe
Dog. “No more selling someone else’s brand. No more
working for someone else. Onitsuka has been holding
us down for years. Their late deliveries, their mixed-up
orders, their refusal to hear and implement our design
ideas—who among us isn’t sick of dealing with all that?
. . . If we’re going to succeed, or fail, we should do so on
our own terms, with our own ideas—our own brand.”
After the initial shock wore off, relief swept across
Blue Ribbon’s employees. Not only were they undaunted
by the new mission, they were energized and excited
about it. Their future lay in their own hands, and they
would nd a way to achieve it. Immediately, they began
formulating new strategies and plans. Knight thinks the
culture and agility of the company were major reasons
why Nike became the success it is today. Most, if not
all, of its employees were scrappy competitive types.
“Each of us was willing to do whatever was necessary
to win,” he says. “And if ‘whatever was necessary’ fell
outside our area of expertise, no problem. Not that any
of us thought we wouldn’t fail. In fact we had every
expectation that we would. But when we did fail, we
had faith we’d do it fast, learn from it, and be better
for it . . . Taking a chance on people—you could argue
that’s what it’s all been about.”
Questions
1. Who is ultimately responsible for formulating a
rm’s strategy—its managers, employees, or both?
2. What strategy execution problems do you think
Knight and Bowerman might have faced in their
effort to make Nike successful?
Sources: Frank Kalman, “Nike, Phil Knight and the Power of Shared Purpose,” Talent Economy (January 26, 2017), http://www.talenteconomy.com; Andy Gould, “Three
Lessons for Entrepreneurs from Nike ‘Shoe Dog’ Phil Knight,” Motley Fool (January 17, 2017), http://fool.com; Lara O’Reilly, “Eleven Things Hardly Anyone Knows about
Nike,” Business Insider (November 4, 2014), http://www.businessinsider.com.
Notes and References
1. Jason Flynn and Arthur H. Mazor, “The Employee
Experience: Culture. Engagement, and Beyond,” Deloitte
(February 28, 2017).
2. Jo Faragher, “Perception of the Value of HR Improved
During the Pandemic,” Per son n el Toda y ( January 25,
2021).
3. Marcel Schwantes, “Steve Jobs Once Gave Some Brilliant
Management Advice on Hiring Top People. Here It Is in 2
Sentences,” Inc., https:/ / www.inc.com/ marcel-schwantes/
this-classic-quote-from-steve-jobs-about-hiring-employeesdescribes-what-great-leadership-looks-like.html, retrieved
April 4, 2018; “The Importance of HR,” HR Focus 73, no.
3 (March 1996): 14; “Retiring Workforce, Widening Skills
Gap, Exodus of ‘Critical Talent’ Threaten Companies:
Deloitte Survey,” Ca n a dia n Cor pora te News (February 15,
2005); Brian E. Becker and Mark A. Huselid, “Strategic
Human Resources Management: Where Do We Go from
Here?” Jou rn a l of Ma n a gemen t 32, no. 6 ( January 2006):
898–925; Jack Welch, “The ‘But’ Economy,” The Wa ll Street
Jou rn a l (October 30, 2003).
4. John Delery and Dorothea Roumpi, “Strategic Human
Resource Management, Human Capital and Competitive
Advantage: Is the Field Going in Circles?” Hu ma n
Resou rce Ma n a gemen t Jou r n a l 27, no. 1 (2017): 1–21;
Scott A. Snell, Mark Shadur, and Patrick M. Wright,
“Human Resources Strategy: The Era of Our Ways,”
in M. A. Hitt, R. E. Freeman, and J. S. Harrison (eds.),
Ha n dbook of Stra tegic Ma n a gemen t (Oxford, UK:
Blackwell, 2002): 627–49; Patrick M. Wright, Benjamin
Dunford, and Scott A. Snell, “Human Resources and
the Resource-Based View of the Firm,” Jou r n a l of
Ma n a gemen t 27, no. 6 (2002): 701–21; “What’s Affecting
90
HR Operations? Globalization, Sustainability, and
Talent,” HR Focus 84, no. 8 (August 2007): 8; Doris
Sims, “Do You Know Where Your Talent Is?” Tra in in g
45, no. 1 ( January 2008): 42–46.
5. Agency for Healthcare Research and Quality, “High
Performance Work Practices in CLABSI Prevention
Interventions,” https:/ / www.ahrq.gov/ hai/ cusp/ clabsihpwpreport/ clabsi-hpwpap.html, retrieved July 26,
2020.
6. R. Covey, The 8th Ha bit: Fr om Effectiven ess to Grea tn ess
(New York: Free Press, 2004).
7. Agency for Healthcare Research and Quality, “High
Performance Work Practices in CLABSI Prevention
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8. P. Block, Stewa rdship: Choosin g Ser vice Over SelfIn terest (2 nd Ed.). (San Francisco, CA: Berrett-Koehler
Publishers, 2013).
9. Agency for Healthcare Research and Quality, “High
Performance Work Practices in CLABSI Prevention
Interventions.”
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Performance Work Practices in CLABSI Prevention
Interventions.”
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Performance Work Practices in CLABSI Prevention
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12. P. Block, Stewa rdship: Choosin g Ser vice Over SelfIn terest (2nd Ed.). (San Francisco, CA: Berrett-Koehler
Publishers, 2013).
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13. Agency for Healthcare Research and Quality, “High
Performance Work Practices in CLABSI Prevention
Interventions.”
14. Yun-Hwa Chiang, Chu-Chun Hsu, and His-An Shih,
“Experienced High Performance Work System,
Extroversion Personality, and Creativity Performance,” Asia
Pa ci c Jou rn a l of Ma n a gemen t 32, no. 2 (2015): 531–49.
15. Karina Van De Voorde and Susanne Beijer, “The Role of
Employee HR Attributions in the Relationship Between
High-Performance Work Systems and Employee
Outcomes,” Hu ma n Resou rce Ma n a gemen t Jou r n a l 25,
no. 1 (2015): 62–78.
16. Stefanos Giannikis and Irene Nikandrou, “The Impact
of Corporate Entrepreneurship and High-Performance
Work Systems on Employees’ Job Attitudes: Empirical
Evidence from Greece During the Economic Downturn,”
The In ter n a tion a l Jou r n a l of Hu ma n Resou rce
Ma n a gemen t 24, no. 19 (2013): 3644–66.
Perceptions of HR Effectiveness: Services, Roles, and
Contributions,” Hu ma n Resou rce Ma n a gemen t 40,
no. 2 (2001): 111–23; Ryan Langlois, “Fairmont Hotels:
Business Strategy Starts with People,” Ca n a dia n HR
Repor ter 14, no. 19 (November 5, 2001): 19–25.
24. Google’s website, https:/ / www.google.com/ about/
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25. Jay J. Jamrog and Miles H. Overholt, “Building a
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Bu sin ess Review 86, no. 6 ( June 2008): 60–70.
26. Ann Zimmerman, “Dime a Dozen: Dollar Stores Pinched
by Rapid Expansion,” WSJ On lin e (February 4, 2013),
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17. Jake G. Messersmith, Pankaj C. Patel, David P. Lepak,
and Julian S. Gould-Williams, “Unlocking the Black
Box: Exploring the Link Between High-Performance
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Psychology 96, no. 6 (2011): 1105.
27. Kelly Marchesse, Siva Paramasivam, and Michael Held,
Deloitte Consulting, “Bouncing Back: Supply Chain
Risk Management Lessons from Post-tsunami Japan,”
In du str y Week (March 9, 2012), http:/ / www.industryweek.com.
18. Duckjung Shin and Alison M. Konrad, “Causality
Between High-Performance Work Systems and
Organizational Performance,” Jou r n a l of Ma n a gemen t
43, no. 4 (2017): 973–97.
28. Paul Carsten, “Apple China Mobile Launch Could Spark
Costly Subsidy War,” Reu ter s ( January 7, 2014), http:/ /
www.reuters.com.
19. Pankaj C. Patel, Jake G. Messersmith, and David P.
Lepak, “Walking the Tightrope: An Assessment of
the Relationship Between High-Performance Work
Systems and Organizational Ambidexterity,’ Aca demy of
Ma n a gemen t Jou r n a l 56, no. 5 (2013): 1420–42.
20. “The Importance of HR,” 14. For data from a similar
survey conducted in Canada, see David Brown, “HR’s
Role in Business Strategy: Still a Lot of Work to Be
Done,” Ca n a dia n HR Repor ter 14, no. 19 (November
5, 2001): 1–20; “How Should the HR Dept. of 2004 Be
Structured?” Hu ma n Resou rce Depa r tmen t Ma n a gemen t
Repor t, no. 3 (November 2003): 1; K. Carrig, S. Snell,
and A. Onozuka, “In Search of Execution.” in P. M.
Wright, D. Ulrich, R. Antione, and E. Sartaine (eds), View
fr om the Top: Levera gin g Hu ma n a n d Or ga n iza tion a l
Ca pita l to Crea te Va lu e (Alexandria, VA: SHRM
Publishing, 2016).
21. T. J. Watson, Jr., A Bu sin ess a n d Its Beliefs: The Idea s
Tha t Helped Bu ild IBM (New York: McGraw-Hill, 1963);
Xavier Castañer and Howard Yu, “The Role of Middle
and Top Managers in the Strategy Process,” in Ha n dbook
of Middle Ma n a gemen t Stra tegy Pr ocess Resea rch
(Cheltenham, UK: Edward Elgar Publishing, 2017).
22. Jo Faragher, “Brexit Bringing Out the Best in Strategic HR
Planning, Says Survey,” Person n el Toda y (April 16, 2019).
23. Chad Albrecht, Timothy Gardner, Scott Allred, Brad
Winn, and Adam Condie, “To Sit at the Table, You Have
to Know the Language: Important Financial Metrics for
HR Directors,” Stra tegic HR Review 15, no. 3 (2016):
123–28; Patrick Wright, Gary McMahan, Scott Snell, and
Barry Gerhart, “Comparing Line and HR Executives’
29. Tara Deschamps, “New Apps Emerge Amid COVID-19 to
Tackle Grips with Popular Delivery Services,” Tor on to
Sta r (May 3, 2020).
30. Scott A. Snell, Mark Shadur, and Patrick M. Wright,
“Human Resources Strategy,” 627–49; Patrick M. Wright
et al., “Human Resources and the Resource-Based View
of the Firm”; David Collis and Cynthia Montgomery,
“Competing on Resources,” Ha r va rd Bu sin ess Review
86, no. 7/ 8 ( July–August 2008): 140–50; Susan Cantrell,
“The Work Force of One,” The Wa ll Street Jou r n a l 249,
no. 140 ( June 16, 2007): R10; Nicolai J. Foss, “Networks,
Capabilities, and Competitive Advantage,” Sca n din a via n
Jou r n a l of Ma n a gemen t 15, no. 1 (1999): 1–15.
31. D. P. Lepak and S. A. Snell, “The Human Resource
Architecture: Toward a Theory of Human Capital
Development and Allocation,” Aca demy of Ma n a gemen t
Review 24, no. 1 (1999): 31–48; David Lepak and Scott
Snell, “Examining the Human Resource Architecture:
The Relationship among Human Capital, Employment,
and Human Resource Con gurations,” Jou r n a l of
Ma n a gemen t 24, no. 1 ( January 1999): 31; Mike Berry,
“HR Must Push for Change to Drive Human Capital
Strategy,” Per son n el Toda y (April 6, 2004): 4; Brian E.
Becker and Mark A. Huselid, “A Players or A Positions?
The Strategic Logic of Workforce Management,”
Ha r va rd Bu sin ess Review 83, no. 12 (December 2005):
110–17; Rossella C. Gambetti and Mattia Giovanardi,
“Re-visiting the Supply Chain: A Communication
Perspective,” Cor pora te Commu n ica tion s: An
In ter n a tion a l Jou r n a l 18, no. 4 (2013).
32. Jessica Youngman, “A Call to Be ‘Audacious and Bold,”
Syra cu se Un iver sity a n d News ( July 28, 2021).
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33. Joseph F. Castellan and Susan S. Lightle, “Using Cultural
Audits to Assess Tone at the Top,” CPA Jou r n a l 75, no. 2
(February 2005): 6–11; Steven D. Olson, “Shaping an
Ethical Workplace Culture,” SHRM (2013).
48. J. E. Gamble and R. Ray Gehani, “Ea stma n Koda k,”
in Arthur A. Thompson, Margaret A. Peteraf, John E.
Gamble, and A.J. Strickland III (eds), Cra ftin g a n d
Execu tin g Stra tegy (New York: McGraw-Hill, 2013).
34. “SAS Again Ranks No. 1 on ‘FORTUNE Best Companies
to Work For’ List in America,” SAS.com ( January 20,
2011), http:/ / www.sas.com.
49. Elizabeth F. Chapman, Faye A. Sisk, Jeff Schatten, and
Edward W. Miles, “Human Resource Development and
Human Resource Management Levers for Sustained
Competitive Advantage: Combining Isomorphism
and Differentiation,” Jou r n a l of Ma n a gemen t &
Or ga n iza tion 24, no. 4 (2018): 533–50.
35. Patrick M. Wright, “Human Resource Strategy: Adapting
to the Age of Globalization,” SHRM Foundation.
36. Stephenie Overman, “Gearing Up for Tomorrow’s
Workforce,” HR Focus 76, no. 2 (February 1999):
1–15; Kathryn Tyler, “Evaluate Your Next Move,” HR
Ma ga zin e 46, no. 11 (November 2001): 66–71; Bill
Leonard, “Turnover at the Top,” HR Ma ga zin e 46, no. 5
(May 2001): 46–52; Peter Louch, “Workforce Planning
Is Essential to High-Performing Organizations,” SHRM
(October 3, 2014), https:/ / www.shrm.org/ resourcesandtools/ hr-topics/ technology/ pages/ louch-workforceplanning.aspx.
37. SHRM, “Putting Forecasting in Focus,” https:/ / www.
shrm.org/ hr-today/ news/ hr-magazine/ pages/ 0307cover.
aspx, retrieved August 6, 2021.
38. Sarah Dobson, “Few Successors Line Up for Top Roles,”
Ca n a dia n HR Repor ter 27, no 14 (August 11, 2014): 3–7.
39. Robert Kaplan and David Norton, Stra tegy Ma ps:
Con ver tin g In ta n gible Assets in to Ta n gible Ou tcomes
(Boston: Harvard Business School Press, 2006): Chapter 8.
40. John Huey, “Outlaw Flyboy CEOs,” For tu n e 142, no. 11
(November 13, 2000): 237–50; “Visions of the Future,”
Hu ma n Resou rces ( January 2008): special section, 22.
41. Margaret Heffernan, Brian Harney, Kenneth Cafferkey,
and Tony Dundon, “Exploring the HRM–Performance
Relationship: The Role of Creativity Climate and
Strategy,” Employee Rela tion s (2016).
42. Eric M. Olsen, Stanley F. Slater, G. Tomas M. Hult,
and Kai M. Olson, “The Application of Human
Resource Management Policies Within the Marketing
Organization: The Impact on Business and Marketing
Strategy Implementation,” In du str ia l Ma rketin g
Ma n a gemen t 69 (2018): 62–73.
43. Margaret Heffernan, Brian Harney, Kenneth Cafferkey,
and Tony Dundon, “Exploring the HRM–Performance
Relationship: The Role of Creativity Climate and
Strategy,” Employee Rela tion s (2016).
44. Todd Palmer, “Use ‘The Good Jobs Strategy’ to Find
Employees,” Pr odu ction Ma chin in g (August 2015).
45. Eric M. Olsen et al., “The Application of Human Resource
Management Policies Within the Marketing Organization.”
46. Eric M. Olsenet al., “The Application of Human
Resource Management Policies Within the Marketing
Organization.”
47. Jeremy Galbreath, Lorenzo Lucianetti, Ben Thomas,
and Daniel Tisch, “Entrepreneurial Orientation and
Firm Performance in Italian Firms: The Moderating
Role of Competitive Strategy,” In ter n a tion a l Jou r n a l of
En trepren eu r ia l Beha vior & Resea rch 26, no. 4 (2020).
92
50. Li-Yun Sun and Wen Pan, “Differentiation Strategy,
High-Performance Human Resource Practices, and Firm
Performance: Moderation by Employee Commitment,”
The In ter n a tion a l Jou r n a l of Hu ma n Resou rce
Ma n a gemen t 22, no. 15 (2011): 3068–79.
51. Jeremy Galbreath et al., “Entrepreneurial Orientation
and Firm Performance in Italian Firms.”
52. Yi Hua Hsieh and Hai Ming Chen, “Strategic Fit Among
Business Competitive Strategy, Human Resource
Strategy, and Reward System,” Aca demy of Stra tegic
Ma n a gemen t Jou r n a l 10, no. 2 (2011): 11.ß
53. Brian Becker, Mark Huselid, and Dave Ulrich, The HR
Scoreca rd: Lin kin g People, Stra tegy a n d Per for ma n ce
(Cambridge, MA: Harvard Business School Press, 2001).
See also Shari Caudron, “How HR Drives Pro ts,”
Workforce 90, no. 12 (December 2001): 26–31; Herbert
G. Heneman III and Anthony T. Milanowski, “Assessing
Human Resource Practices Alignment: A Case Study,”
Hu ma n Resou rce Ma n a gemen t 50, no. 1 (2011): 45–64.
54. David Trainer, “Misaligned Incentives That Led to
Valeant Disaster Go Unaddressed,” Forbes (April 13,
2016).
55. Donald Sull, Rebecca Homkes, and Charles Sull, “Why
Strategy Execution Unravels—And What to Do About It,”
Ha r va rd Bu sin ess Review (March 2015).
56. Ken Favaro, “De ning Strategy, Implementation, and
Execution,” Ha r va rd Bu sin ess Review (March 31, 2015).
57. Brian E. Becker and Mark A. Huselid, “Strategic Human
Resources Management”; Neeraj Gupta and Christina C.
Benson, “Sustainability and Competitive Advantage: An
Empirical Study of Value Creation,” Competition For u m
9, no. 1 (2011).
58. Robert Kaplan and David Norton, Stra tegy Ma ps.
59. P. M. Wright and S. A. Snell, “Toward a Unifying
Framework for Exploring Fit and Flexibility in
Strategic Human Resource Management,” Aca demy of
Ma n a gemen t Review 22, no. 4 (1998): 756–72; Scott
A. Snell, Mark Shadur, and Patrick M. Wright, “Human
Resources Strategy”; Patrick M. Wright et al., “Human
Resources and the Resource-Based View of the Firm.”
60. R. Sanchez, “Strategic Flexibility in Product
Competition,” Stra tegic Ma n a gemen t Jou r n a l 16 (1995):
135–59; P. M. Wright and S. A. Snell, “Toward a Unifying
Framework”; Secil Bayraktar Kazozcu, “Role of Strategic
Flexibility in the Choice of Turnaround Strategies:
A Resource Based Approach,” Pr ocedia -Socia l a n d
Beha viora l Scien ces 24 (2011): 444–59.
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employment equity
The employment of individuals in a fair and
nonbiased manner
Learning Outcome 1
Explain the reasons for and main aspects of
equity-related legislation.
A more diverse and multicultural workforce has made it increasingly important
for managers to know and comply with numerous laws and norms related to
equity, diversity, and inclusion. Managers and HR professionals are expected to
manage employees in ways that comply with and respect the laws and regulations
of Canada. These laws protect both employees and employers. In some cases, the
laws have been created because of previous situations where employees were not
treated fairly. In other cases, the laws simply re ect the values of society. Human
rights legislation and employment equity legislation, introduced in this chapter,
arose because of both these cases. However, they are not the only laws that govern
the employment relationship. You will become familiar with other legislation,
always introduced in the context of the functions, such as the regulations governing the handling of hazardous material in Chapter 12, which addresses occupational health and safety. It is important to know that managers (and employees)
cannot do whatever they want at work without suffering consequences. The consequences range from criminal charges, costly and time-consuming litigation, negative publicity for the organization, and a decrease in organizational morale and
commitment. Therefore, following the laws and regulations is just good business,
as you will see in the discussion of equity and diversity.
Canada is one of the most diverse countries in the world—a kaleidoscope
of cultures, languages, and nationalities consisting of more than 250 different
ethnic groups. Almost 22 percent of residents were born outside Canada, with
more than 9 out of 10 of these immigrants making their homes in urban centres.
By 2036, about one in every three Canadians will be a visible minority.1 The
workplace must not only re ect this reality but also accommodate this diversity.
Discrimination based on race, age, or sex is illegal in every jurisdiction.
Employment equity has received considerable attention in HRM in recent
decades.2 Em p loym en t eq u ity, or the treatment of employed individuals in a
fair and nonbiased manner, has attracted the attention of the media, the courts,
practitioners, and legislators. Employment equity is not just the absence of discrimination; it is the proactive programs to ensure that the organization’s workforce is representative of the population. Employment equity legislation affects
all aspects of the employment relationship. When managers ignore the legal
aspects of HRM, they risk incurring costly and time-consuming litigation, negative public attitudes, and damage to organizational morale.
Employment equity is not only a legal topic; it is also an emotional issue. It
concerns all individuals regardless of their sex, religion, age, national origin, race,
or position in an organization. Supervisors should be aware of their personal
biases and how these attitudes can in uence their dealings with subordinates. It
should be emphasized that covert as well as blatantly intentional discrimination
in employment is illegal.
In this chapter, we emphasize the legislation governing employment equity
and describe the organizational response to this legislation. Today, compliance
with employment equity involves managing diversity and inclusion with the goal
of fully using the organization’s human capital.
The Ca n a dia n Cha r ter of Rights a n d Freedoms, the federal Ca n a dia n Hu ma n
Rights Act (CHRA), and pay equity and employment equity acts are the governing
pieces of legislation dealing with employment equity.
Th e L e g a l Fr a m e w o r k
Th e C a n a d ia n C h a r t e r o f Rig h t s a n d Fr e e d o m s
The Con stitu tion Act of 1982, which contains the Ca n a dia n Cha r ter of Rights
a n d Freedoms, is the cornerstone of equity legislation. The Cha r ter guarantees
some fundamental rights to every Canadian, including
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fundamental freedoms (s. 2) that comprise the standard rights of freedom of
speech, press, assembly, association, and religion;
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democratic rights (ss. 3 to 5), covering franchise rights;
mobility rights (s. 6), concerning the right to move freely from province to
province for the purposes of residence and/ or employment;
legal rights (ss. 7 to 14), conferring standard procedural rights in criminal
proceedings;
equality rights (s. 15), guaranteeing no discrimination by law on the grounds
of race, ethnic origin, colour, religion, sex, age, sexual orientation, marital
status, citizenship, Aboriginal residence, or mental and physical ability; and
language rights (ss. 16 to 23).3
Alth ou gh th e Cha r ter h as offered many Can ad ian s op p ortu n ities regard in g
th eir own in divid u al righ ts an d resp on sibilities, it h as also been a sou rce
of d isap p oin tmen t. Th e en actmen t of th e Cha r ter created h igh exp ectation s
on th e p art of various grou p s, esp ecially u n ion s, wh ich believed th at u n d er
Section 2, all emp loyees wou ld h ave a fun d amen tal righ t to associate, to
Ethics in HRM
Ethic s: Eq uality o r Eq uity
The Public Works department of the federal government sent
its managers an email telling them that persons recruited
externally must be from designated groups. The federal
Department of Fisheries ran an ad on the government’s
website that stated explicitly that those who can apply are
“persons working or residing in Canada and Canadian citizens living abroad, who are members of the visible minority
groups.” The Employment Equity Act de nes members of
visible minorities as being “persons, other than Aboriginal
people, who are non-Caucasian in race or nonwhite in
colour.” The decision to restrict applicants to members
of visible minorities is part of the government’s efforts to
have its employees look more like the Canadian population.
Currently, about 22.3 percent of Canadians identify themselves as being part of a visible non-Indigenous minority,
and they represent about 21.6 percent of the labour market.
As of 2019, 16.7 percent worked in the public service. Yet,
recent studies have found that visible minorities in Canada
still face signi cant barriers when it comes to hiring, even
slightly more so than visible minorities in the United States.
To foster increased diversity, the government decreed that
it would focus on generating and publishing more in-depth
information for an accurate picture of representation gaps,
increase the diversity of senior leaders, ensure the right
benchmarks for diversity are established, and address systemic barriers. This initiative is supported by a $12 million
budget.
Unlike the United States, quotas are not in place in
Canada. However, words such as benchmarks, targets,
and goals may have the same impact. Critics argue that
candidates should be judged on merit, not colour, and that
other programs to increase minority candidates would be
better; for example, providing more education and training
for minority groups or creating an of ce culture that values
diversity. The public service has a good track record in
increasing the number of francophones and women, and
restricted competitions may not be the best route. But the
commissioner of the public service counters that treating
all people the same way does not always lead to equitable
results, and special measures are necessary.
Sources: T. Blackwell, “White Males Need Not Apply,” National Post (November 19, 2005): A1; E. Greenspon, “Don’t Apply,” The Globe and Mail (May 30,
2003): A16; M. Wente, “Whites Need Not Apply,” The Globe and Mail (May 29, 2003): 21; Statistics Canada, “Immigration and Ethnocultural Diversity:
Key Results from the 2016 Census,” http://www.statcan.gc.ca/daily-quotidien/171025/dq171025b-eng.htm, retrieved May 10, 2021; Statistics Canada,
“Distribution of Public Service of Canada Employees by Designated Sub-Group and Occupational Category—Members of Visible Minority,” https://
www.canada.ca/en/treasury-board-secretariat/services/innovation/human-resources-statistics/diversity-inclusion-statistics/distribution-publicservice-canada-employees-designated-sub-group-occupational-category-visible-minorities.html, retrieved May 10, 2021; M. Collie, “Canada has a
Discrimination Problem When it Comes to Hiring—Here’s Why,” Global News (June 25, 2019); Government of Canada, “Diversity and Inclusion Areas of
Focus for the Public Eye,” https://www.canada.ca/en/government/publicservice/wellness-inclusion-diversity-public-service/diversity-inclusion-publicservice/diversity-inclusion-priorities-public-service.html, retrieved May 10, 2021.
Chap t er 3: E q u i t, y Di v e r s i t, y a n d I n c l u s i o n : T h e L e g a l E n v i r o n m e n t
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bargain collectively, an d to strike. However, in 1987, th e Su p reme Cou rt of
Can ad a, in rulin g on a ch allen ge to fed eral p u blic-sector laws relatin g to
comp u lsory arbitration , back-to-work legislation , an d wage restrain t legislation , d eclared th at Section 2 of th e Cha r ter d oes n ot in clu d e th e righ t to
bargain collectively an d to strike. In th e Cou rt’s view, th ese were n ot fu n d amen tal freed oms; in stead , th ey are statu tory righ ts created an d regu lated by
legislation . As a result of th is ru lin g, govern men ts can weaken th e collective
bargain in g p rocess by limitin g salary in creases, legislatin g strikers back to
work, an d imp osin g comp u lsory arbitration . However, a 2007 case in British
Colu mbia ru led th at th e Cha r ter d oes p rotect th e righ t to bargain collectively.
It is imp ortan t to n ote th at th e Cha r ter p rotects on ly th e righ t of govern men t
an d p ublic-sector emp loyees, n ot p rivate-sector emp loyees.
Various court cases can h igh ligh t th e p ower of equity legislation. Take, for
examp le, Tawney Meiorin, wh o h ad been h ired as a forest re gh ter in British
Columbia. Meiorin h ad been emp loyed for th ree years, working to sup p ress
small forest res, and h er sup ervisors h ad been satis ed with h er work. Wh en
th e government adop ted a new series of tness tests for re gh ters, Meiorin
p assed only th ree of four tests. Given th at sh e could not p ass th e fourth test,
Meiorin was dismissed from h er job. Th e union subsequently brough t forth a
grievance on beh alf of Meiorin. Th e test was viewed as an excessive standard,
and men and women did not h ave an equal ability to meet th e standard. Th e
arbitrator found th at th ere was, in fact, discrimination. Th e government did
not p rovide any p roof th at failing th e aerobic test meant th at Meiorin was a
safety risk. Sh e was reinstated to h er p osition and p aid for h er lost wages and
bene ts.
In anoth er case, a Jewish teach er h ad asked for an amendment to th eir collective agreement th at would allow th em to h ave th eir most imp ortant h oliday
off from work with p ay. Th e teach er h ad been told th at th ey were able to take
th e day off with out p ay. Wh en taken to th e Sup reme Court, th ey considered
th at th e h oliest Ch ristian days of Ch ristmas and Good Friday were days off
with p ay. Th erefore, th e Jewish teach er required accommodation, and a p aid
day off for th e teach er was included in th e collective agreement. In anoth er
examp le p ertaining to religion, an Ontario nurse in th e intensive care unit converted to become a Jeh ovah ’s Witness and could not carry out certain asp ects
of th e blood transfusion. Th e h osp ital h ad let h er go, declaring th at taking
blood was an essential duty. Th e case was brough t to arbitration. Th e board
determined th at th e emp loyer did not h ave to keep th e nurse in th e p revious
p osition with in th e intensive care unit. However, th e h osp ital h ad an obligation to accommodate th e nurse by offering a p osition elsewh ere with in th e
h osp ital in wh ich taking blood was not a p rimary resp onsibility. 4
Th e C a n a d ia n H u m a n Rig h t s A c t (C H RA )
The Ca n a dia n Hu ma n Rights Act was passed by Parliament on July 14, 1977, and
became effective in March 1978. This Act proclaims that every individual should
have an equal opportunity with other individuals to make for themselves the life
that they are able and wish to have, consistent with their duties and obligations as
a member of society, without being hindered in or prevented from doing so by discriminatory practices based on race, national or ethnic origin, colour, religion, age,
sex, or marital status, or convictions for an offence for which a pardon has been
granted or by discriminatory employment practices based on physical handicap.5
The Act applies to all federal government departments and agencies, to Crown
corporations, and to other businesses and industries under federal jurisdiction,
such as banks, airlines, railway companies, and insurance and communications
companies.
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Lisa S./ Shutterstock.com
Workplace accommodation for
persons with disabilities is usually inexpensive.
For th ose areas not under federal jurisdiction (th e vast majority of workp laces), p rotection may be available under p rovincial h uman righ ts laws.
Provincial laws, alth ough very similar to federal ones, differ from p rovince to
p rovince. Each p rovince and territory h as a h uman righ ts act (or code), and
each h as jurisdiction p roh ibiting discrimination in th e workp lace.
Th e p ro h ib ite d gro u n d s o f d iscrim in atio n in e m p loym e n t in clu d e
race , re ligio n , sex, age , n atio n al o r e th n ic o rigin , p h ysical h an d icap ,
an d m arital statu s (se e Figu re 3.1 fo r a co m p le te listin g). Em p loye rs are
p e rm itte d to d iscrim in ate if e m p loym e n t p re fe re n ce s are b ase d o n a
b o n a f id e o ccu p a t io n a l q u a lif ica t io n (B FO Q ) o r b o n a fid e o ccu p atio n al
re q u ire m e n t (BFO R), an d it is n o t p o ssib le to acco m m o d ate th e e m p loye e
w ith o u t cau sin g u n d u e h ard sh ip . A BFO Q is ju stifie d if th e e m p loye r can
e stab lish n e ce ssity fo r b u sin e ss o p e ratio n s. In o th e r wo rd s, d iffe re n tial
tre atm e n t is n o t d iscrim in atio n if th e re is a ju stifiab le re aso n . Fo r exam p le ,
acco rd in g to O n tario p rovin cial le gislatio n , ad h e re n ce to th e te n e ts o f th e
Ro m an Cath o lic Ch u rch w as d e e m e d a BFO Q fo r e m p loym e n t as a te ach e r
in a Ro m an Cath o lic sch o o l. 6 Bu sin e ss n e ce ssity also re late s to th e safe
an d e fficie n t o p e ratio n o f an o rgan izatio n . Th e re is an o n go in g d e b ate as
to w h e th e r m ale gu ard s sh o u ld b e allowe d to wo rk in wo m e n ’s p riso n s
an d w h e th e r m e m b e rs o f th e Sik h re ligio n , w h o se re ligio n m an d ate s th e
we arin g o f tu rb an s, m u st we ar h ard h ats at co n stru ctio n site s. Th e d u ty
to acco m m o d ate is an im p o r tan t p ar t o f h u m an righ ts le gislatio n an d is
d iscu sse d m o re th o ro u gh ly late r in th e ch ap te r, u n d e r sp e cial m e asu re s an d
re aso n ab le acco m m o d atio n .
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bona de occupational
quali cation (BFOQ)
Ajusti able reason for discrimination
based on business reasons of safety or
effectiveness
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Gregg Vignal/ Alamy Stock Photo
When looking for employees,
employers need to assess abilities.
Enfo rc e m e nt o f the Canad ian H um an Rig hts Ac t
The Canadian Human Rights Commission (CHRC) deals with complaints concerning
discriminatory practices covered by the Ca n a dia n Hu ma n Rights Act. CHRC may
choose to act on its own if it believes that suf cient grounds exist for a nding of
discrimination. It also has the power to issue guidelines interpreting the Act.
Individuals have a right to le a comp laint if they feel they have been discriminated against. (CHRC may refuse to accep t a comp laint if it has not been
led within a p rescribed p eriod of time, if it is deemed trivial, or if it was led
in bad faith.) The comp lainant must rst comp lete a written rep ort describing
the discriminatory action. A CHRC rep resentative reviews the facts and determines whether the claim is legitimate. Once a comp laint has been accep ted by
CHRC, an investigator is assigned the task of gathering more facts from both
the comp lainant and the accused. The investigator then submits a rep ort to
CHRC recommending a nding of either substantiation or nonsubstantiation of
the allegation. If the allegation is substantiated, a settlement may be arranged
during the investigation. If the p arties are unable to reach an agreement, a
human rights tribunal consisting of up to three members may be ap p ointed
to further investigate the comp laint. If the tribunal nds that a discriminatory
p ractice did take p lace or that the victim’s feelings or self-resp ect has suffered
because of the p ractice, it may order the p erson or organization resp onsible to
comp ensate the victim. For instance, Chris Hughes, a man from Victoria, British
Columbia, who formerly worked at Transp ort Canada, won three Human Rights
Tribunal cases against his p revious emp loyer. Hughes claimed his emp loyer had
discriminated against him due to both his age and his dep ression and anxiety.
Hughes had noticed internal hires of staff much less exp erienced than himself.
He was also denied a p osition when he disclosed his mental health exp eriences
and was refused additional time and accommodations for his mental health
issues. Hughes has been awarded $500,000 thus far. He is still awaiting the
judiciary review to set the nal imp lications for his multip le wins. He could be
receiving as much as $2 million. 7
Any person who obstructs an investigation or a tribunal, or who fails to
comply with the terms of a settlement, can be found guilty of an offence, which
may be punishable by a ne and/ or jail sentence. If the guilty party is an employer
or an employee organization, the ne can be as high as $50,000.8
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F ig u r e 3 .1
Pro hib ite d Gro und s o f Disc rim inatio n in Canad a
This document provides comparative information on the grounds of discrimination covered by federal, provincial, and territorial human
rights legislation in Canada. In some instances, prohibited grounds for employment differ from those for the provision of services.
Grounds Prohibited in Every Jurisdiction
All Canadian jurisdictions prohibit discrimination on the grounds of disability, sex, race, colour, ethnic origin, age, creed or
religion, marital status, family status,* and sexual orientation.
Additional Prohibited Grounds of Discrimination, by Jurisdiction
Record
of
Offence
Ancestry
Income
Source/Public
Assistance
Gender
Identity/
Expression
Political
Opinion/
Belief
Social
Disadvantage/
Condition
Citizenship/
Nationality
Other
Federal
Alberta
British
Columbia
Manitoba
New
Brunswick
Newfoundland
and Labrador
Northwest
Territories
dis gurement
(in
de nition
of social
conditions)
Nova Scotia
irrational fear of
contracting an
illness or disease
Nunavut
Ontario
(receipt
of public
assistance)
Prince Edward
Island
Quebec
Saskatchewan
language, civil
status
(receipt
of public
assistance)
Yukon
linguistic origin
* In Quebec, “civil status” has been interpreted to include family status and marital status. See, for example, Brossard (Town) v. Quebec (Commission des droits de la
personne). [1988] 2 SCR 279.
Source: From Doorey, David J., The Law of Work, 2nd Edition, Emond, March 2020, https://emond.ca/the-law-of-work-2nd-edition.html.
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Th e En fo r c e m e n t o f P r o v in c ia l H u m a n
Rig h t s L a w s
Provincial human rights laws are enforced in a manner very similar to that of the
federal system. At the provincial level, employers tend to be small and mediumsized businesses, many of which lack an HR professional who is knowledgeable
about human rights legislation. Employers and employees alike may have little
experience in matters of discrimination. The Ontario legislation now permits
employees to le complaints directly to the Human Rights Tribunal.
The majority of cases are resolved at the investigation stage. If no agreement
can be reached, the case is presented to the province’s human rights commission.
The members of the commission study the evidence and then submit a report
to the minister in charge of administering human rights legislation. The minister
may appoint an independent board of inquiry, which has powers similar to those
of a tribunal at the federal level. Failure to comply with the remedies prescribed
by the board of inquiry may result in prosecution in provincial court. Individuals
and organizations or groups may be ned between $1,000 and $10,000. These
levies vary from province to province.
Check In
Have you ever felt discriminated against in the workplace? How about in school/college/university
by a teacher/professor? How did it make you feel?
Learning Outcome 2
Identify the legal framework related to
diversity, equity, and inclusion, including the
Charter and human rights legislation.
10
P a y Eq u it y
Pay equity is covered by all Canadian jurisdictions, either through explicit laws
or policies, except Alberta. As a result of a 1978 amendment to the Ca n a dia n
Hu ma n Rights Act, pay equity became enacted as law in the federal jurisdiction.
Under Section 11, it is discriminatory for employers to establish or maintain pay
differences between male and female employees in the same establishment who
are performing work of equal value. The Equal Wages Guidelines, enacted in 1986,
offers guidance on how to assess the value of work using such factors as skill, effort,
responsibility, and working conditions. Enforcement mechanisms are outlined in
the Ca n a da La bou r Code. More recently, the federal government implemented a
new Pa y Equ ity Act that came into effect in August 2021. Organizations covered
by the federal jurisdiction will have three years to conform to the pay equity
requirements and implement a pay equity plan. The new legislation is proactive,
rather than complaints based.9 Proactive pay equity legislation is already in force
in provinces such as Ontario and Quebec.
Pay equity law makes it illegal for employers to discriminate against individuals on the basis of job content. Pay equity helps address the discriminatory
portion of the historical wage gap between men and women and to ensure that
salary ranges re ect the value of the work performed. When comparing men and
women working full-time and full-year, women in Canada earn approximately
$0.74 for every $1 earned by men, slightly worse than in the United States, where
women earned $0.75 compared to men.10 There is a gender pay gap in every
jurisdiction in Canada and in every major occupational group.
By de nition, pay equity means equal pay for work of equal value. It is based
on two principles. The rst is equal pay for equal work—pay equality.11 This is
usually covered in labour standards legislation. Male and female workers must
be paid the same wage rate for doing identical work. The secon d is equal pay for
work of comparable worth, or equal pay for work of comparable value. This is the
focus of pay equity legislation. This means that male and female workers must be
paid the same wage rate for jobs of a similar nature that may have different titles
(e.g., “nurse’s aide” and “orderly”). Professor Marc Mentzer at the Edwards School
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of Business at the University of Saskatchewan suggests that these key points may
help in understanding the differences between pay equality and pay equity:
●
●
Pay equality (in which employers are required to pay women the same as
men doing the same job) is required by law in every jurisdiction in Canada.
Pay equality is about fair pay for individual women employees. For example,
a female electrician must be paid the same as a male electrician.
Pay equity is about fair pay for entire occupations, which are dissimilar,
usually within an organization, such as comparing nurses (as a group) to
electricians. It is based on the value of a job to the organization. Pay equity
legislation varies by jurisdiction in Canada.
Implementation of pay equity is based on comparing the value of the work of
female-dominated job classes to the value of work performed in male-dominated
job classes. Comparisons require the use of a gender-neutral, unbiased comparison
system to evaluate the jobs in an establishment.12 Comparisons must be based
on the amount and type of skill, effort, and responsibility needed to perform
the job and on the working conditions where it is performed. The comparison
must be done in such a way that the characteristics of “male” jobs, such as heavy
lifting and “dirty” working conditions, are valued fairly in comparison with the
characteristics of “female” jobs, such as manual dexterity and caring for others.13
At the federal level, pay equity legislation applies to that section of the
workforce under its jurisdiction and covers all organizations regardless of the
number of employees. The original federal pay equity system was complaint-based,
meaning that complaints were raised by an employee, a group of employees, or a
bargaining agent.14 Some decisions included compensating high school secretaries
at rates similar to the male job class of audiovisual technicians and comparing
a female job class of law clerk to that of the male job class of investigator,
female health technicians to male transportation workers, the female job class
of personnel managers to the male job class of service manager, and femaledominated dispatchers to male-dominated radio technical supervisors.15 The new
pay equity legislation, passed in 2018 and enacted in 2021, is proactive. A more
comprehensive review of pay equity is provided in Chapter 9.
Check In
Do we need pay equity legislation to close the gender pay gap? Please explain your answer.
Learning Outcome 3
Em p lo y m e n t Eq u it y
Central to Canada’s economic growth and p rosp erity in a highly comp etitive
global marketp lace will be a barrier-free environment in which all Canadians
can fully exp lore and develop their career p otential. Labour force statistics
(see Chap ter 1) indicate changing p atterns of immigration, rising labour force
p articip ation rates for women, and an aging p op ulation with a p rop ortionally
higher incidence of disabilities.
Women, Indigenous Peoples,16 members of visible minorities, and people
with disabilities make up over 60 percent of Canada’s labour force, and their
numbers continue to rise.17 Members of designated groups (as de ned by federal legislation) entering Canada’s labour pool constitute a vital resource, and
their full participation in the workplace will be fundamental to an organization’s
ability to understand and respond to the needs of a rapidly changing marketplace. As a society, we have moved beyond principle to imperative in ensuring
equal access to employment opportunities.
By de nition, equ ity means fairness and impartiality. In a legal sense, it means
justice based on the concepts of ethics and fairness and a system of jurisprudence
administered by administrative tribunals. The implementation of employment
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Understand the need for and role of pay
equity legislation.
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designated groups
Women, visible minorities, Indigenous
Peoples, and people with disabilities who
have been disadvantaged in employment
equity has involved establishing policies and practices designed to ensure
equitable representation in the workforce and to redress past discriminations.
(Note that in the United States, the term a f r ma tive a ction is used and includes
quotas, which are not typically part of employment equity in Canada.) There are
four d esign ated gr ou p s in Canada (as recognized in the federal Employmen t
Equ ity Act) that have historically not received equitable treatment in employment.
St a t u s o f D e s ig n a t e d G r o u p s
Women, Indigenous Peoples, visible minorities, and people with disabilities face
signi cant (albeit different) disadvantages in employment, even though they
make up about 60 percent of Canada’s workforce. Some of these disadvantages
include high unemployment, occupational segregation, pay inequities, and
limited opportunities for career progress.
Wom en
Women tend to be concentrated in occupations that are accorded lower status and
pay. In 2020, women constituted roughly 50 percent of the total workforce but
were not equally represented in all occupations. Women are underrepresented as
semi-professionals and technicians, as supervisors in trades, and in natural and
applied sciences. Women are also underrepresented in management positions
and as members of boards. As well, it is still the case that female earnings lag
behind those of men. Although there are several ways to measure the gender pay
gap (e.g., using hourly wages, all wages for all workers), a common metric used
is the difference in the wages for men and women who work full-time, full year.
This measure suggests that the gender pay gap in Canada is about 0.79; that is,
for every dollar a man earns, a woman gets 79 cents.18
Several strategies for the retention of women can be found in Highlights in
HRM 3.1.
Ind ig e no us Pe o p le s
According to the 2016 Census, 1.7 million people self-identify as Indigenous in
Canada, approximately 5 percent of the total Canadian population, up from 3.8
percent in 2006. Forty-eight percent were male. Among people who identify themselves as Indigenous, 58 percent are First Nations, 35 percent are Métis, and 4
percent are Inuit. More than 70 Indigenous languages were reported in the 2016
Census. The unemployment rate for Indigenous individuals is higher than the
national unemployment rate. Recent data also suggest that roughly 50 percent
of Indigenous people aged 25 to 64 were postsecondary graduates, 14 percent
had a trade credential, 21 percent had a college diploma, 4 percent had a university diploma or certi cate, and 10 percent had a university degree. Employment
rates tend to rise with higher educational attainment.19 The research suggests that
Indigenous people earn less than non-Indigenous people. In 2010, the median
income for the Canadian population was $29,900, whereas the median income for
Indigenous people was $18,962.20 In western Canada, they account for a substantial portion of labour market growth.
However, many Indigenous people face major barriers to employment,
including underfunding of on-reserve education and lack of good educational
supports, unreliable Internet in remote locations,21 lack of a driver’s license,22
and the lack of Indigenous role models in such areas as business and banking.23
These barriers are often compounded by low educational achievement and lack
of job experience, as well as by language and cultural barriers. In urban centres,
many Indigenous workers are concentrated in low-paying, unstable employment.
Economic self-suf ciency and participation in the economy are seen as essential
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Highlights in HRM 3.1
Re te ntio n Strate g ie s
What can companies do to retain women? Here are
10 strategies:
1. Equal pay. People talk about pay, and it is important that
women know that they are receiving equal pay for work
of equal value.
6. Focus on the family. Allow women to get the work
done but on a schedule that accommodates their
family responsibilities.
2. Flex schedules. Accommodate women with childcare and
eldercare responsibilities by offering them four 10-hour
days, half-days, or exible arrival times.
8. Creating networks and networking opportunities.
Networking opportunities enable women to better
achieve their goals.
3. Forty-hour workweeks. Many professionals are willing
to work and accomplish but unwilling to put in 80-hour
weeks.
9. Integration. Integrating women into the organization
makes them feel more included, and this is a critical
success factor for women.
4. Part-time and job sharing. This is an ideal solution for
new mothers.
10. Offering paid leave for men and women. Reducing
the stereotype helps bridge the gender inequality
when men are allowed to take long leaves similar to
women.
5. Mentoring. Pair a promising woman professional with a
senior manager to help her develop a career strategy.
7. Offering opportunities. All employees will stay in jobs
if they are learning.
Sources: D. De Marco, “Retaining Gen XWomen Becoming Crucial,” Canadian HR Reporter 20, no. 31 (December 3, 2007): 31. Reprinted by permission of the
Canadian HR Reporter. © Copyright Thomson Reuters Canada Ltd., 2007, Toronto, Ontario, 1-800-387-5164. Web: www.hrreporter.com; A. Tomlinson, “Wall
Street Rougher than Bay Street,” Canadian HR Reporter 15, no. 5 (March 11, 2002): 1, 14; Denise T. Cormier, “Retaining Top Women Business Leaders: Strategies
for Ending the Exodus,” Business Strategies Series 8, no. 4 (2007): 1–7; Sharon Florentine, “Six Ways to Attract and Retain Female IT,” CIO(October 30, 2014),
http://www.cio.com/article/2841636/staff-management/6-ways-to-attract-and-retain-female-it-talent.html; Yoree Koh, “Google’s New Diversity Chief to Tackle
Slow Pace of Change; Danielle Brown Faces Challenge of Hiring, Retaining More Underrepresented Groups, Women,” Wall Street Journal (June 29, 2017);
Brittany V. Rockwell, Joanne D. Leck, and Catherine J. Elliott, “Can E-mentoring Take the ‘Gender’ out of Mentoring?” Cyberpsychology: Journal of Psychosocial
Research on Cyberspace 7, no. 2, article 5, http://dx.doi.org/10.5817/CP2013-2-5D.
to Indigenous development. Interestingly, Indigenous values such as cooperation
and consensus decision making have become more closely aligned with management approaches.24 The Conference Board of Canada recommends several
strategies to retain Indigenous individuals in remote Canada. These strategies
include inclusion practices to ensure that employees feel valued, cultural awareness training, encouraging traditional practices and community and family obligations, offering professional development opportunities, and providing mentorship,
coaching, and cohort programs.25 This process seems to lead to some amount of
loyalty. The PTI Group, based in Edmonton, Alberta, reported that 94 percent of
the nearly 200 Indigenous employees hired in 2010 were still with the company
a year later. According to Sandy Sanderson, the director of Indigenous relations
at the PTI Group, “it’s a better retention rate than any other demographic we
have working in the company.”26 PTI’s success seems to have been carefully laid
through efforts to build partnerships with Indigenous communities, training their
own employees on diversity issues, and tackling Indigenous employment barriers.
Pe o p le w ith Disab ilitie s
It is estimated that at least 22 percent of Canadians aged 15 and over have a
disability. This rate increases with age, with about 13.1 percent of those between
15 and 24 years, 15.3 percent of those 25 to 44 years, 24.3 percent of those aged
45 to 64, 32 percent of those between the ages of 65 and 74, and 47.4 percent
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of those over age 75 having a disability. As little as 59 percent of Canadians with
disabilities between the ages of 25 to 64 are employed compared to 80 percent of
Canadians without disabilities. Further, individuals with disabilities earn less than
Canadians without disabilities. Those with less severe disabilities make 12 percent
less than average, and those with more severe disabilities earn 51 percent less than
the average population.27 This disparity was only further exacerbated during the
COVID-19 pandemic, during which 36 percent of those with disabilities temporarily
or permanently lost their job.28
About one-third of those with disabilities became disabled as adults, resulting in
70 percent of them being forced to make career changes.29 People with disabilities
face attitudinal barriers, physical demands that are unrelated to job requirements,
and inadequate access to the technical and human support systems that would
make productive employment possible. Over one in three (37 percent) percent of
those with disabilities need at least one workplace accommodation,30 and in over
half of the cases, the cost is less than $500 and for many others the cost is less than
$1,500.31 Employers can seek to redress attitudinal barriers by focusing on abilities,
not disabilities. Highlights in HRM 3.2 provides an example of accommodation.
Highlights in HRM 3.2
Ac c e ssib ility
A candidate comes to your of ce for an employment interview.
Because of a vision impairment, she uses a long white cane to
navigate. You approach her to guide her to the interview room.
Do you
●
take her arm and guide her to the room?
●
suggest that she follow your voice?
●
ask her if she needs assistance?
If you don’t know the answer (it’s c), training is available
through Ontario’s new mandatory accessibility standard, which
came into force for private organizations in 2012. The customer
service training program teaches how to deal with people
with disabilities, what a disability is, and the different types of
disabilities. It also teaches how to accommodate employees
with disabilities that con ict (a person with a service animal
seated next to someone who is allergic to animals). It means
rethinking general rules that discriminate against an individual. For example, some professors do not allow laptops
in the classroom, but a person with hearing disabilities may
require one to participate. The professor is encouraged to allow
everyone to have a laptop rather than make an exception for
one individual. In addition to the customer service training
requirements, policies continue to be updated. In 2015, and
then updated in 2020, a new obligation was established for
producers of educational resources to make textbooks and
all other printed educational material available in accessible
formats, such as braille, large print, online on accessible
websites, accessible le types, digital audio, and tactile maps,
pictures, or diagrams. Further, as of 2017, it was required that
all organizations have an accessibility policy, accessibility standards in their recruitment process, communication supports or
accessible formats, and individualized workplace emergency
responses of employees who have a disability. Organizations
with more than 50 employees must also ensure that they have
a documented individual accommodation plan for employees
with disabilities and return-to-work processes for employees
returning from an absence due to a disability. Company websites and Web content must meet accessibility requirements
as well. Further, there are requirements for each organization
to submit compliance reports to ensure they are conforming to
the accessibility standards. There are also a series of proposed
targets for every organization within Ontario to be accessible
by 2025, which include policies, measures, and practices to
remove barriers for all Ontarians.
Sources: Anonymous, “Accessibility,” HR Professional (May/June, 2010): 24–27; Canadian Council in Social Development and Accessibility for Ontarians with
Disabilities Act, 2005; Sarah Dobson, “Push on to Hire More People with Disabilities,” Canadian HR Reporter 30, no. 12 (July 10, 2017): 7; Greg Thompson, “New
AODA Requirement for Producers of Educational Resources,” Accessibility for Ontarians with Disabilities Act (January 6, 2020); Gowling WLG, “2020 Accessibility
To-Do List,” (January 15, 2020), https://gowlingwlg.com/en/insights-resources/articles/2020/2020-accessibility-to-do-list-ontario/; Accessibility for Ontarians
with Disabilities Act, “Guide to the Act,” https://www.aoda.ca/guide-to-the-act/.
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Visib le M ino ritie s
The visible minority population in Canada experienced a growth rate of approximately 22 percent between the 2006 and the 2016 censuses, compared to an
overall population growth of about 13 percent. The 2016 Census reports that
visible minorities represent 22.3 percent of Canadians, compared to 19.1 percent
in 2011, 16.2 percent in 2006, and 4.7 percent in 1981. Members of visible minorities also comprise about 22 percent of the labour force.32
Visible minority group s vary in their labour force p ro les and in their
regional distributions. Studies have shown that Latin Americans and Southeast
Asians exp erience lower-than-average incomes, higher rates of unemp loyment,
and reduced access to job interviews even when they have the same quali cations as other candidates. See Highlights in HRM 3.3 for a study documenting
this. Systemic barriers that negatively affect emp loyment for visible minority
group s include culturally biased ap titude tests, a lack of recognition of foreign credentials, and excessively high language requirements. Recent statistics
indicate that Canadian-born women that are a visible minority are more likely
than other women and men to have a university degree. Whereas 27 p ercent of
white women have a university degree, 52 p ercent of second-generation visible
minority Canadian women have a university degree.33 However, visible minority
women have a slightly lower emp loyment rate than other women and men. 34
Highlights in HRM 3.3
W hat’s in a N am e ?
Metropolis, an immigration and diversity research network,
sent out 6,000 résumés tailored to the job requirements of
2,000 online postings from employers across 20 occupational categories. These included administrative, nancial,
marketing, programming, and retail positions. All résumés
included a university degree and two to four years of relevant
experience. The only difference on these résumés was the
name of the applicant. Some had names such as Tara Singh,
and others had names such as Emily Brown. The results
were a wake-up call for Canadians, who pride themselves
on being less biased than other nationalities. Those with
English names received callbacks 16 percent of the time,
compared to 11 percent for applicants with Pakistani, Indian,
and Chinese names who had the same level of education and
experience. According to the study’s author, UBC economics
professor Philip Oreopoulos, “The ndings suggest that a
distinct foreign-sounding name may be a signi cant disadvantage on the job market—even if you are a second- or
third-generation citizen.” He adds, “In cases where the
employer requires the hire to be very good at English, then
consciously or unconsciously, they may have a concern when
looking at their résumé. The other possibility is preferencebased discrimination: the employer, consciously or unconsciously, prefers to have applicants of the same ethnicity
working for them.”
Those who had been educated outside Canada
received callbacks eight percent of the time and those
who had no Canadian work experience only ve percent
of the time, con rming that Canadian work experience
is very important to employers. Whereas immigrants had
unemployment rates of 11.5 percent in 2006 (compared
to 4.9 percent for the Canadian-born population), secondgeneration immigrants of Chinese and Indian origin have
statistically above-average incomes and educations. A new
online tool, Roadmap, from the Toronto Region Immigrant
Employment Council, will help employers hire, integrate,
and retain skilled immigrants. For more information, visit
www.hireimmigrants.ca/roadmap.
Sources: M. Jimenez, “Right Resume, Wrong Name,” The Globe and Mail (May 21, 2009): I1; Anonymous, University of British Columbia, “Employers
Discriminate Against Applicants with Non-English Names, UBC Study Suggests,” NewsRx Health & Science (June 21, 2009): 198; D. Karp, “Job Seekers
with Asian Names Face Discrimination; Canadians with English Names Are Called Back More Often for Job Interviews, UBC Study Finds,” Vancouver Sun
(May 21, 2009): A1.
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F ig u r e 3 .2
Re p re se ntatio n o f De sig nate d Gro up s in the Lab o ur Fo rc e
Representation in the Canadian
Population (%)
Representation in the Labour
Force (%)
Women
50.3
48.2
Indigenous Peoples
4.9
4.0
People with disabilities
11.0 (ages 15 and up: 22.3)
3.0 (ages 15 and up: 9.1)
Visible minorities
22.3
21.3
Sources: Statistics Canada, “Aboriginal Peoples Highlight Tables, 2016 Census,” http://www12.statcan.gc.ca/census-recensement/2016/dp-pd/hlt-fst/abo-aut/
Table.cfm?Lang=Eng&T=101&S=99&O=A, retrieved May 20, 2021; Statistics Canada, “Canadian Population Aged 15 Years and Over, By Age Group and Disability
Status, 2017,” https://www150.statcan.gc.ca/n1/pub/89-654-x/89-654-x2018002-eng.htm, retrieved May 20, 2021; Statistics Canada, “Population Estimates
on July 1st, By Age and Sex,” https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1710000501&pickMembers%5B0%5D=1.1&pickMembers%5B1%5D
=2.3&cubeTimeFrame.startYear=2016&cubeTimeFrame.endYear=2020&referencePeriods=20160101%2C20200101, retrieved May 20, 2021; Julia Whalen,
“Census 2016: More Than Half of Torontonians Identify as Visible Minorities,” CBC (October 25, 2017), https://www.cbc.ca/news/canada/toronto/census-visibleminorities-1.4371018, retrieved May 20, 2021; Government of Canada, “2016 Employment Equity Data Report,” https://www.canada.ca/en/employment-socialdevelopment/corporate/portfolio/labour/programs/employment-equity/reports/2016-annual.html, retrieved May 20, 2021.
The unemp loyment rate for members of visible minorities (9.2 p ercent) is signi cantly higher than non-members (7.7 p ercent). 35 As such, there are targeted
efforts to recruit them to ensure rep resentation.
Figure 3.2 shows the workforce representation of the designated groups in
the Canadian population. Ethics in HRM describes some of the issues in employment equity.
B e n e t s o f Em p lo y m e n t Eq u it y
Employment equity makes good business sense. It contributes to the bottom line
by broadening the base of quali ed individuals for employment, training, and
promotions and by helping employers avoid costly human rights complaints.
Employment equity enhances an organization’s ability to attract and keep the
best-quali ed employees, which results in greater access to a broader base of
skills. It also enhances employee morale by offering special measures such as
exible work schedules and work sharing. Finally, it improves the organization’s
image in the community.36
Check In
How can organizations bene t if they implement employment equity? See whether you can locate
related research and organizational examples.
Learning Outcome 4
Th e Em p lo y m e n t Eq u it y A c t (19 9 5 )
Discuss the Employment Equity Act with
respect to its origins, its purpose, and its
continued enforcement and the implementation of employment equity in many Canadian
organizations.
Employers and Crown corporations that have 100 employees or more and that are
regulated under the Ca n a da La bou r Code must implement employment equity
and report on their results. Under the Act, the employer is required to
●
●
106
provide its employees with a questionnaire that allows them to indicate
whether they belong to one of the four designated groups;
identify jobs in which the percentage of members of designated groups falls
below their availability in the labour market;
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●
●
communicate information on employment equity to its employees and consult and collaborate with employee representatives;
identify possible barriers in existing employment systems that may be limiting the employment opportunities of members of designated groups;
●
develop an employment equity plan aimed at promoting an equitable workplace;
●
make all reasonable efforts to implement its plan;
●
monitor, review, and revise its plan from time to time; and
●
prepare an annual report on its employment equity data and activities.37
The concept of employment equity is rooted in the wording of federal and
provincial employment standards legislation, human rights codes, and the Cha r ter.
Employment equity involves identifying and removing systemic barriers to employment opportunities that adversely affect women, visible minorities, Indigenous
Peoples, and people with disabilities. Employment equity also involves implementing special measures and making reasonable accommodation.38
Under the Federal Contractors Program (FCP), contractors who bid for goods
and services contracts with the federal government valued at $1,000,000 or more
and that employ 100 people or more are required to implement an employment
equity program. This is not a law, but contractors that do not cooperate may not be
allowed to bid. (For a list of this program’s implementation criteria, see Highlights
in HRM 3.4.) To assist in the process, the federal government provides professional consulting services to employers throughout Canada about how to implement employment equity. Federally regulated employers must conduct a workforce
analysis to identify underrepresentation of members of designated groups; review
their employment systems, policies, and practices to identify employment barriers;
and prepare a plan outlining the steps they will take to remove any identi ed barriers. Most provinces have similar legislation governing employment equity.
Winners of merit awards for initiatives in emp loyment equity include
Scotiabank, for increasing the number of visible minorities in its workforce
to 19 p ercent, and the Saskatchewan Wheat Pool, for its p artnership s with
Highlights in HRM 3.4
Re q uire m e nts fo r the Fe d e ral Co ntrac to rs Pro g ram
The Federal Contractors Program (FCP), established in 1986,
ensures that contractors that do business with the federal
government achieve and maintain a workforce that is representative of the Canadian workforce. The FCP was recently
redesigned (2013), whereby, among other changes, the contract
threshold was increased from $200,000 to $1 million, and the
requirements were streamlined from 12 to 4, as follows:
representation rates with external availability of the four
groups and determining the gaps, if any).
3. Establish short- and long-term numerical goals (these
hiring and promotion goals must be established so as to
increase representation rates of the designated groups
and close the gaps, if any).
1. Collect workforce information (the contractor is required
to survey its workforce to ascertain the representation of
the four designated groups in each occupational group).
4. Make reasonable progress and reasonable efforts (the
contractor must make reasonable efforts to implement
employment equity so that reasonable progress toward
full representation of the designated groups is achieved).
2. Complete a workforce analysis (this requires a comparison, once every three years, between internal
You can open the link below for further details of the FCP and
each of the requirements above.
Source: Adapted from Federal Contractors Program, http://www.hrsdc.gc.ca/eng/labour/equality/fcp/requirement.shtml.
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Indigenous communities—p articularly its investment in an MBA p rogram in
Indigenous business. In the face of threats to emp loyment equity legislation,
emp loyers must show a willingness to keep the p ractice alive. As Verlyn Francis,
arbitrator and p rincip al at Isiko Resolutions, a consultancy that sp ecializes in
con ict resolution and diversity and inclusion, states, “Numerous studies have
shown that when you have diverse voices at the table, better and more p ro table decisions are made. To get there, however, businesses have to break the
vicious circle that p erp etuates exclusion and comp romises their p ro tability.”39
A d m in is t r a t io n a n d En fo r c e m e n t o f t h e
Em p lo y m e n t Eq u it y A c t
Employment and Social Development Canada (formerly Human Resources
Development Canada) is responsible for administering the FCP. CHRC is mandated under the Ca n a dia n Hu ma n Rights Act 40 to prohibit discrimination in the
establishments of federally regulated businesses.41
CHRC is authorized to conduct on-site compliance reviews. Failure to comply
may result in nes ranging from $10,000 for rst offenders to $50,000 for repeat
offenders.
Th e Im p le m e n t a t io n o f Em p lo y m e n t Eq u it y
in O r g a n iz a t io n s
The implementation of employment equity in an organization follows the
precepts of any change management program. Thus, successful implementation
must employ strategic planning, which must be incorporated into an overall
business strategy. The FCP outlined in Highlights in HRM 3.4 provide a good
overview of what a plan should incorporate. The process generally involves
six main steps: senior management commitment, data collection and analysis,
employment systems review, establishment of a workplan, implementation, and
a follow-up process that includes evaluation, monitoring, and revision.
Ste p 1: Se nio r M anag e m e nt Co m m itm e nt
Commitment to an emp loyment equity p lan necessitates a top -down strategy.
A more sup p ortive culture is created when the CEO or owner-op erator p ublicly introduces written p olicy describing the organization’s commitment to
emp loyment equity and enact a strategy to champ ion diversity. For examp le,
the CEO, all members of the board of directors, and the staff at the Law Society
of Up p er Canada all received equity and human rights training. As another
examp le, Canadian Imp erial Bank of Commerce (CIBC) established a national
emp loyment equity and diversity council to ensure an inclusive workp lace for
all emp loyees. 42
The policy statement should be supplemented with a communiqué explaining
what employment equity is, the rationale for the program, and its implications for
current and future employees. Assurances must be given. The communiqué should
also outline any planned activities the employer may deem necessary to establish
the program (e.g., analysis of the workforce or of policies and procedures).
This commitment to employees and candidates for employment applies to
all aspects of the employment relationship, including recruitment, work assignment, training opportunities, compensation, promotions, transfers, and terminations. Communication tools conveying the commitment and strategy to diversity
and promoting awareness may include periodic information sessions, workplace
posters, departmental or small-group meetings conducted by line management,
orientation and training programs, newsletters, and vehicles such as videos, brochures, employee handbooks, and memos from the union.
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Assig nm e nt o f Ac c o untab le Se nio r Staff
Emp loyers covered by th e Employmen t Equ ity Act are legally obligated to consult with designated emp loyee rep resentatives or, in unionized settings, with
bargaining agents. Th e resp onsibility for emp loyment equity is p laced in th e
h ands of a senior manager, a joint labour–management committee, and an
emp loyment equity advisory committee with mech anisms for union consultation (or, in nonunionized settings, for consultation with designated emp loyee
rep resentatives).
Committee members may be required to review emp loyment p ractices,
advertising and recruitment p olicies, comp any-sp onsored training, the organization of work schedules, and systems for p romotion to management p ositions.
Anyone given resp onsibility for emp loyment equity must be knowledgeable
about the concerns of designated group s, have the status needed to gain the
coop eration of emp loyees at all levels in the organization, have access to the
resources required to conduct p lanning and imp lementation be in a p osition to
rep ort to the CEO on the results of emp loyment equity measures, and serve as
the emp loyment equity contact p erson with federal and p rovincial government
agencies.
The labour movement in Canada generally supports the concept of employment equity as long as unions are fully informed and involved from the beginning with respect to an employer’s planning process.43 Many employers and
unions have successfully negotiated family-friendly policies such as parental
leave, childcare provisions, and exible hours.
Ste p 2 : Data Co lle c tio n and Analysis
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stock data
Data showing the status of designated
groups in occupational categories and
compensation levels
ow data
Data that provide a pro le of the employment decisions affecting designated groups
benedek/ E+/ Getty Images
Th e develop ment of an internal workforce p ro le is an imp ortant tool in
emp loyment equity p lanning. It help s determine where the comp any stands
relative to the internal and the external workforce. Pro les must be based on
both stock data and ow data. Sto ck d ata p rovide a snap shot of the organization. Th ey show where members of designated group s are emp loyed in the
organization, at what salaries and status, and in what occup ations on a p articular date. Flow d ata refer to the distribution of designated group s in ap p lications, interviews, hiring decisions, training and p romotion op p ortunities, and
terminations. Th ey p rovide information on the movement of emp loyees into
and through the organization.
Most of the information necessary for equity p lanning (e.g., salary, sex,
access to bene ts, seniority status, and occup ational history within the organization) is contained in existing p ersonnel les. Information p ertaining to
the distribution of members of designated group s in the organization must be
accumulated by the emp loyer through a self-identi cation p rocess. Emp loyees
must voluntarily agree to be identi ed or identify themselves as members of
designated group s.
Employers can encourage participation and con dence in the program by
providing employment equity training to managers and by providing opportunities for managers to be recognized for their employment equity contributions.
Cameco Corporation in northern Saskatchewan has committed to improving the
job prospects of Indigenous individuals as part of its long-term employment
strategy. Mentoring, basic training, educational support, and family assistance
programs mean a lot to those employees, who may be the rst in their families
to have full-time employment.44
Problems may arise with self-identi cation. Under some provincial employment equity acts, terms such as Abor igin a l and ra cia l min or ity are not de ned.
Some employees who have “hidden” disabilities may not wish to label themselves
for fear of future discriminatory treatment. Some members of minority groups
have never disclosed their ethnic origins for similar reasons.
First Nations University is a unique
university in Canada that caters to
the advanced education needs of
Indigenous Peoples.
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underutilization
Term applied to designated groups that are
not utilized or represented in the employer’s
workforce proportional to their numbers in
the labour market
concentration
Term applied to designated groups whose
numbers in a particular occupation or level
are high relative to their numbers in the
labour market
If too many employees with nonvisible disabilities do not identify themselves
as having a disability, the program could end up being designed to recruit more
employees with disabilities, leaving another segment of the employee population
underrepresented. An additional concern is that if individuals with disabilities do
not self-identify, they would have denied themselves some form of accommodation that they may need. Highlights in HRM 3.5 outline words and actions that
are appropriate in dealing with persons with disabilities.45
Once the personal information forms have been completed, all occupations within the organization must be cross-referenced to the four-digit National
Occupational Classi cation (NOC) classi cations. For example, secretaries and
stenographers are classi ed in unit group 4111, which in turn can be assigned
to the “clerical workers” group. A workforce analysis can then be generated.
This utilization analysis will include a distribution of members of designated
groups according to occupations and salary levels throughout the organization.
Comparisons will show which designated groups exhibit u n d er u tilization and
which groups exhibit con cen tr ation in speci c occupations or levels, in proportion to their numbers in the labour market.46
Highlights in HRM 3.5
Sug g e stio ns fo r Inc lusio n
Any Disability
Offer assistance when it seems as though an individual with
a disability needs support. However, wait until the offer is
accepted before assisting them.
Person Who Is Blind or Person with a Visual
Impairment
Identify yourself and anyone with you; if you have met
before, explain the context of the meeting; speak in a
normal tone of voice and indicate to whom you are speaking
if in a group; remove obstacles; describe the surroundings
(“There is a door on your right”); if offering to guide, ask the
person to take your arm above the elbow and walk about
a half-step ahead; plan ahead to obtain material in audio
recordings or Braille.
wheelchair without permission as it is part of their personal
space; give directions that include distance and physical objects
such as curbs; put yourself at eye level when it is possible.
Person Who Is Deaf or Deafened, or Person with
a Hearing Impairment
To get the attention of a person with hearing loss, tap gently on
their shoulder or arm; speak clearly and at a pace that allows the
sign language interpreter to interpret and to allow for questions;
write notes or use gestures for one-on-one discussions; face the
person to facilitate lip reading; speak clearly, slowly, and directly
to the person, not the interpreter; reduce or eliminate background
noise; keep your hands away from your face when speaking
and use short sentences; if an individual uses a sign-language
interpreter, speak to the person not the interpreter.
Person with a Physical Disability or Person with
a Mobility Impairment
Person Who Is Unable to Speak or Person with
a Speech Impairment; Person with a Learning,
Developmental, or Psychiatric Disability
Rearrange furniture or objects to accommodate a wheelchair
or other mobility aid; avoid leaning on a mobility aid; push
someone in a wheelchair only when asked. Do not touch the
When needed, offer assistance, and provide guidance; repeat
information when necessary; speak directly to the person and
listen actively.
Sources: Treasury Board of Canada Secretariat, “Creating a Welcoming Workplace for Employees with Disabilities.”; David Brown, “Focus on Ability Not
Disability,” Canadian HR Reporter 13, no. 22 (December 18, 2000): 12; The Conference Board of Canada, “Employer’s Toolkit: Making Ontario Workplaces
Accessible to People with Disabilities, 2nd Edition,” Accessibility Canada (October, 2015).
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Ste p 3 : Em p lo ym e nt Syste m s Re vie w
Employmen t systems or employmen t pra ctices are the means by which employers
carry out personnel activities such as recruitment, hiring, training and development, promotion, job classi cation, discipline, and termination. Some of these
practices are found in personnel manuals and collective agreements, whereas
others remain more informal and based on traditional practices.
Employers are legally accountable even when discrimination is the unintended result of employment systems that block the progress of particular groups
of employees or potential employees for reasons unrelated to quali cations,
merit, or business requirements. This unintentional discrimination is referred to
as systemic discr imin a tion .
Sys t e m ic B a rrie rs in Em p lo ym e n t Pra c t ic e s
System ic d iscr im in ation refers to the exclusion of members of certain groups
through the application of employment policies or practices based on criteria that
are neither job related nor required for the safe and ef cient operation of the business. Systemic discrimination can create legal concerns for an organization. Many
employment barriers are unintentionally hidden, including, among others, physical
access that restricts those who are mobility challenged, recruitment practices that
limit applications from designated groups, and job descriptions and job evaluation
systems that undervalue the work of women. Inequity can result if these barriers
encourage or discourage individuals based on their membership in certain groups
rather than on their ability to do a job that the employer needs done. In one
case, the Supreme Court of Canada ruled that a physical tness test discriminated
against women and required the employer to reinstate the woman as a re ghter.47
Another example of systemic discrimination occurs when an employer’s
workforce represents one group in our society and the company recruits new
employees by posting job vacancies within the company or by word of mouth
among the employees. This recruitment strategy is likely to generate candidates
similar to those in the current workforce, thereby unintentionally discriminating
against other groups of workers in the labour market. A better approach might be
to vary recruitment methods by contacting outside agencies and organizations,
some of which may represent designated groups. A few years ago, the federal
Treasury Board launched a task force on visible minorities in the federal public
service based on a recommendation by the National Capital Alliance on Race
Relations (NCARR). The task force’s mandate was to develop an action plan to
improve participation and advancement of visible minorities in the federal public
service as it relates to employment, which is still in effect today.48
The following employment practices and issues may need to be reviewed:
job classi cations and descriptions, recruitment processes, training and development, performance evaluation systems, promotions and upward mobility, levels
of compensation, access to bene ts, termination processes, discipline procedures,
facilities (e.g., building design, barrier-free access), and access to assistance.
The usual test for identifying systemic barriers involves using the following
criteria to assess the policy:
●
●
●
●
systemic discrimination
The exclusion of members of certain groups
through the application of employment policies or practices based on criteria that are
not job related
Is it job related?
Is it valid? (i.e., does it, or the required quali cation, have a direct relationship to job performance?)
Is it consistently applied?
Does it have an adverse impact? (i.e., does it affect members of designated
groups more than those of dominant groups?)
●
Is it a business necessity?
●
Does it conform to human rights and employment standards legislation?49
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If the employee pro les indicate that certain types of people are underrepresented, then special measures may be undertaken to correct this imbalance.
Sp e c ia l M e a s u re s a n d Re a s o n a b le A c c o m m o d a t io n
reasonable accommodation
Attempt by employers to adjust the working
conditions or schedules of employees with
disabilities or religious preferences
Special measures are initiatives designed to accelerate the entry, development,
and promotion of members of designated groups from among the interested and
quali ed workforce. For example, some special measures may include targeted
recruitment or special training initiatives aimed mainly at correcting, over a specied period of time, employment inequities stemming from past discrimination.
These measures are intended to hasten the achievement of fair representation of
the four designated groups in an employer’s workforce.
Re a s o n a b le a cco m m o d a t io n in volves ad ju stin g emp loymen t p olicies
an d p ractices so th at n o in d ivid u al is d en ied b en e ts, d isad van taged w ith
resp ect to emp loymen t op p ortu n ities, or b locked from carryin g ou t th e
essen tial comp on en ts of a job b ecau se of race, colou r, sex, or d isab ility.
Emp loyers mu st n d th e mean s to alter systems to meet th e n eed s of th eir
emp loyees as lon g as th is d oes n ot cau se “u n d u e h ard sh ip to th e emp loyer.”
Reason ab le accommod ation may in clu d e red esign in g job d u ties; ad ju stin g
work sch ed u les; p rovid in g tech n ical, n an cial, an d h u man su p p ort services;
an d u p grad in g facilities. Th e City of Toron to d evelop ed award -w in n in g facilities in its b arrier-free access p rogram, w h ich was d esign ed to allow p eop le
w ith d isab ilities accessib le p assage th rou gh ou t city facilities. An Amazon
fu l llmen t cen tre in Ottawa work s w ith th e Sign Lan gu age In terp retin g
Associates Ottawa to offer an on site sign -lan gu age in terp reter to comb at
th e commu n ication b arriers w ith d eaf emp loyees. A similar p ractice is b ein g
u sed in a facility in Delta, British Colu mb ia. Fu rth er, d u rin g th e COVID-19
p an d emic, th e facility offered certain emp loyees tran sp aren t COVID-19 face
mask s, so emp loyees w h o cou ld n ot h ear cou ld read th eir lip s. 50 Yet n ot all
work p laces h ave en su red ad eq u ate accommod ation . High ligh ts in HRM 3.6
recou n ts th ree cou rt cases on accommod ation .
Ste p 4 : Estab lishm e nt o f a W o rkp lan
The workforce analysis and the review of employment systems will provide the
employer with a useful base from which to develop a workplan with realistic
goals and timetables. A narrative statement or summary of the conclusions drawn
from the examination of the workforce analysis forms part of the employment
equity workplan. The summary should include any restrictions faced in hiring
due to collective agreements, staff movements, or the need for specialized skills
in a particular profession. The identi cation of restrictions helps form an overall
employment equity strategy.
The plan should be considered a working tool designed to achieve results. It
is a document that describes how proposed actions are to be achieved. The plan
must include
●
●
●
●
numerical goals with time frames (numerical goals can be expressed in
numbers—for example, 42 percen t of ou r per son n el shou ld be women );
explanations about the proposed improvement in hiring, training, and promotion of the four designated groups to increase their representation and
improve their distribution throughout the organization;
descriptions of speci c activities to achieve the numerical goals; and
an outline of monitoring and evaluation procedures to follow program
implementation.
Numerical goals must be realistic numbers related to workforce analysis.
The goals must catalogue opportunities for hiring, training, promotion, and must
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Highlights in HRM 3.6
The Duty to Ac c o m m o d ate
●
●
Two employees of the Ford Motor Company of Oakville,
Ontario, became members of a religious group that
observed its Sabbath from Friday sunset to Saturday
sunset. Both employees were required to work two
Friday nights out of four, which they refused to do. They
tried, but failed, to make alternative arrangements with
other workers. They were disciplined and ultimately
terminated for unauthorized absenteeism. After a 71-day
hearing, the Human Rights Commission decided it would
constitute undue hardship on Ford to accommodate the
religious absences of these employees.
The Ontario Human Rights Commission found that
the City of Ancaster, Ontario, had discriminated
against a part-time re ghter when they turned
him down for a full-time job because he had partial
vision in one eye. As such, he was unable to obtain
a class F driver’s licence, a job requirement for
driving ambulances that are driven by re ghters.
The tribunal felt that the city should have
accommodated him by assigning him to re ghter
duties exclusively.
●
A recent case in Alberta, SMS Equipment v. CEP Local
707, involved a female employee who sought accommodation based on her duty as a single parent and who
needed to work day shifts because she had no family
nearby and childcare costs were very expensive, causing
nancial hardship if she had to continue working nights.
The employer refused to accommodate the employee,
claiming that it was the employee’s decision to choose
rotating shifts. The Alberta court ruled in favour of the
employee, claiming that the employer has a duty to
accommodate employees suffering hardship due to problematic childcare circumstances. The court also claimed
that the employee was placed at a disadvantage and that
the employer could not prove that accommodating the
employee would have a negative impact on the rm.
Sources: Laura Cassiani, “Law Takes Tough Stand on Accommodation,” Canadian HR Reporter (February 26, 2001): 1, 5. Reprinted by permission of Canadian
HR Reporter. © Copyright Thomson Reuters Canada Ltd., 2001, Toronto, Ontario, 1-800-387-5164. Web: www.hrreporter.com; Jeffrey R. Smith, “A Growing
Family: Another Day, Another Family Status Discrimination Case,” Canadian HR Reporter (April 21, 2015), http://www.hrreporter.com/blog/employment-law/
postprint/2015/04/21/a-growing-family.
demonstrate a valid effort to correct underrepresentation or concentration of
all designated groups in speci c occupations or occupational categories. Nonnumerical goals include activities such as implementation of barrier-free design,
targeted recruitment and advertising, modi cation of employment policies or
practices, and provision of developmental training.
The overall goal for an organization is to achieve a representative workforce.
An organization’s workforce is representative when it re ects the demographic
composition of the external workforce. A nonrepresentative workforce is an indicator of the need for evaluation and action to remove the barriers that block or
discourage certain groups from employment and advancement.
Ste p 5 : Im p le m e ntatio n
The implementation of employment equity is idiosyncratic. Each strategy should
be designed to meet the needs of the particular organization. The success of
plan implementation depends on senior management’s commitment to the process, how the roles and responsibilities are de ned, the resources available, the
effectiveness of the communications strategy, the acceptance of plan initiatives
and objectives, and the availability of training. The plan will be affected by the
changes in the internal and external environment throughout the implementation period. Therefore, its strategies may be modi ed or eliminated when results
are not achieved or if resource restraints or economic conditions necessitate a
different strategy.
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Ste p 6 : Evaluatio n, M o nito ring , and Re visio n
By monitoring progress, the employer will be able to evaluate the overall success
of the equity initiatives used to achieve a representative workforce, as well as
respond to organizational and environmental changes. Annual progress reports
provided to all employees communicate initiatives and achievements. Interim
reports on special projects heighten program visibility and acceptance; they also
promote management commitment and accountability.
The monitoring activity is an essential component in the planning cycle. If
the employer nds, on review of the program, that there are negative results,
alterations to the existing plan will have to be made with new goals. In this
regard, the planning process is evolutionary in that the achievement of employment equity involves organizational changes and builds on experience.
Check In
Following so many equity-related laws might sound daunting. How would you go about hiring a
person to make sure you do not break these laws?
Learning Outcome 5
Discuss sexual harassment as an employment equity issue.
sexual harassment
Unwelcome advances, requests for
sexual favours, and other verbal or physical
conduct of a sexual nature in the working
environment
Se x u a l H a r a s s m e n t
Please note that although this section deals only with sexual harassment, many
of the prescriptions apply equally to other forms of harassment based on, for
example, race or religion. The two main sources of the employer’s duty to prevent harassment in the workplace are
1. human rights legislation, which prevents harassment only on the basis of
the designated grounds in the legislation (e.g., sex, race, religion); and
2. common law obligation to treat workers with decency and respect. This is a
fairly new development in the common law. However, it applies to all forms of
harassment that make the workplace intolerable to the worker. If the employer
fails to stop the harassment, it is in breach of the employment contract. The
employee could quit and sue for constructive dismissal (“reasonable notice”).51
Sexual situations in the work environment are not new to organizational life.
Sexual feelings are a part of group dynamics, and people who work together may
come to develop these kinds of feelings for one another. Unfortunately, however,
often these encounters are unpleasant and unwelcome, as witnessed by the many
reported instances of sexual harassment.52
Accord in g to on e stu dy, on ly 4 of every 10 Can ad ian women wh o su ffer
sexu al h arassmen t at work take any formal action , an d on ly 1 of every 2
women believes th at a comp lain t wou ld be taken seriou sly in h er workp lace. 53
Th is belief is rein forced by cases su ch as th e on e in volvin g a female Sears
emp loyee wh o was sh ot to d eath by h er man ager. Fifteen mon th s earlier, sh e
h ad comp lain ed to h er emp loyer th at sh e was bein g sexu ally h arassed by
h er man ager. Th e comp any main tain ed th at h is beh aviou r d id n ot con stitu te
sexu al h arassmen t an d th at h e was merely a “p ersisten t p u rsu er.” In keep in g
with th is p osition , Sears mad e n o effort to stop th e man ager’s beh aviou r. 54 In
a more recen t case, Ch erry Smiley, a member of th e Klaka’p amu x Nation an d
th e Din e’ Nation , alleges th at in th e secon d year of h er Ph D p rogram sh e was
sexu ally h arassed by h er men tor Step h en Kawkfwi, th e former p remier of th e
North west Territories. Smiley claims th at th e Pierre Elliot Trud eau Fou n d ation
forced h er to sign a n on -d isclosure agreemen t in an attemp t to silen ce h er. 55
In an oth er examp le, th ousan d s of women led sexual h arassmen t comp lain ts
again st th e Royal Can ad ian Mou n ted Police (RCMP). As of early 2018, more
th an 2,400 women h ad led comp lain ts. Th e claims bu ild on two class action s
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Alina555/ E+/ Getty Images
lawsu its led again st th e RCMP in 2012 an d 2015 th at allege a h istory of
sexu al h arassmen t, in timid ation , an d gen d er-based d iscrimin ation committed
by male emp loyees of th e RCMP again st th eir female colleagu es. Th e allegation s in clu de in n u en d os, u n wan ted grop in g, an d sexu al ad van ces. In May
2017 an agreemen t was worked out by a fed eral cou rt ju d ge th at may award
u p to $220,000 to aggrieved women . Th e govern men t h as an n ou n ced th at it
will p u t asid e $100 million to settle th e claims. 56 Sexu al h arassmen t costs, as
High ligh ts in HRM 3.7 sh ow.
In 2015, th e On tario govern men t p assed Bill 132, th e Sexu a l Violen ce
a n d Ha r a ssm en t Pla n Act. Amon g oth er asp ects of th e bill, it amen ds th e
Occu pa tion a l Hea lth a n d Sa fety Act by exp an d in g th e mean in g of workp lace
h arassmen t to in clu d e workp lace sexu al h arassmen t. Th e bill states n ecessary
action s th at mu st be taken by an emp loyer or man ager sh ould sexu al h arassmen t in th e workp lace occu r. Fu rth er, it states th at emp loyers are requ ired
to imp lemen t a workp lace h arassmen t p olicy, wh ich in clu des measu res p ertain in g to sexual h arassmen t. Fu rth er, workers sh ou ld be mad e aware an d
train ed on th e p olicies. 57
Sexual harassment encounters are
unpleasant, causing personal and
organizational hardships.
Highlights in HRM 3.7
The Co st o f Se xual H arassm e nt
In 2017, the Canadian government conducted a study
of workplaces under the federal jurisdiction and discovered that 30 percent of individuals had experienced
sexual harassment or violence in the past two years in
their workplace. This issue is not speci c to the federal
workplace. A 2018 study covering a broader array of
Canadian workplaces found that 34 percent of females
and 12 percent of men were sexually harassed at some
point in their careers. Harassment affects productivity,
retention, morale, turnover, and absenteeism rates. It also
affects an employee’s self-esteem, home life, and stress
levels. Some 41 percent of female victims say they left
a job because of inhospitable organizational culture and
harassment.
The federal courts have agreed upon a $900 million settlement based on multiple class-action lawsuits
of sexual harassment, gender discrimination, and sexual
assault cases against the Canadian Armed Forces and the
Department of National Defence. Lawsuit members will be
paid between $5,000 and $55,000 each. Further, $100,000
could be provided to victims of exceptional harm, including
those who now possess post-traumatic stress disorder. But
what exactly is sexual harassment? According to Canadian
legal cases, the following behaviours de ne sexual
harassment:
●
sexually degrading words or remarks used to describe an
individual or group;
●
inquiries or comments about an individual’s sex life;
●
sexual irtations, advances, and propositions;
●
demands for sexual favours;
●
verbal threats or abuse;
●
leering;
●
unwanted gestures;
●
display of sexually offensive material; and/or
●
sexual assault.
Sources: “Sexual Harassment Endangered Health,” Tribunal OH & S Canada 18, no. 6 (September 2002): 10; Laura Cassiani, “Sexual Harassment Persists
Despite Workplace Fallout,” Canadian HR Reporter 14, no. 7 (April 9, 2001): 1; Government of Canada, “Harassment and Sexual Violence in the Workplace
Public Consultations—What We Heard,” https://www.canada.ca/en/employment-social-development/services/health-safety/reports/workplace-harassmentsexual-violence.html, retrieved May 24, 2021; Adrienne Tanner, “How #MeToo Changed the Workplace,” CPA Canada (November 12, 2019); Kristina Davis, “Poll:
Sex Harassment Caused 41 Percent of Female Victims to Leave Their Jobs,” The San Diego Tribune (December 24, 2017); The Canadian Press, “Federal Court
Approves $900M Deal to Settle Canadian Military Sexual Assault, Harassment Cases,” Global News (November 25, 2019).
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The Ontario Hu ma n Rights Code identi es three kinds of sexual harassment:
1. When someone says or does things to you of a sexual nature and you
do not want or welcome it. This includes behaviour that a person should
know you do not want or welcome (e.g., your supervisor makes you feel
uncomfortable by talking about sex all the time). The Hu ma n Rights Code
says that when you show that you do not welcome or want the remarks or
actions, the person must stop doing those things right away.
2. A person who has authority or power to deny you something, such as a
promotion or a raise, makes sexual suggestions or requests that you do not
want or welcome (e.g., your teacher says you must have sex with them or
you will not pass the course). Even if you do not complain about a sexual
suggestion or request, it can still be sexual harassment unless it is clear that
you welcome or want it.
3. A person with authority or the power to deny you something important
punishes you or threatens to do something to you for refusing a sexual
request (e.g., your employer res you, or threatens to re you, because you
refuse to go on a date).
For sexual harassment policies to succeed, con dentiality is necessary, and
so is a method for ling complaints. Without organizational commitment to
zero tolerance with respect to harassment, any such policy will be meaningless.
Highlights in HRM 3.8 present some suggestions for an effective sexual harassment policy.58
Check In
Does your college or university have a sexual harassment policy for students? Check for it. How
does it compare with a private sector organization you are familiar with?
Learning Outcome 6
Explain and give examples of diversity
management and inclusionary policies.
diversity management
The optimization of an organization’s
multicultural workforce to reach business
objectives
M a n a g in g D iv e r s it y a n d In c lu s io n
Managing diversity goes beyond Canadian employment equity legislation’s four
designated groups in addressing the need to create a fair work environment. The
terms diver sity ma n a gemen t and employmen t equ ity are often used interchangeably, but there are differences. Diver sity m an agem en t is voluntary; employment
equity is not. Managing diversity is a broader, more inclusive concept, encompassing factors such as religion, personality, lifestyle, and education. It involves
having a workplace that represents different types of people and backgrounds.59
Alternatively, managing inclusion involves integration. It entails ensuring that
employees feel a sense of belonging and feel valued, respected, and encouraged
to participate in the organization. Having a diverse workforce does not necessarily
equate to an inclusive workforce. For instance, though there may be a proportionate number of female executives, the culture may not be conducive to feelings
of respect. Organizations must make determined efforts to ensure their workplace
is inclusive and can advance inclusion by using the following strategies:
1. Educate your leaders. Leaders should be trained on what inclusion entails
and its importance.
2. Develop an inclusion council. The council should be involved in strategies
and goals on hiring, retaining, and developing the diverse workforce and
combating engagement issues among underrepresented employee groups.
3. Celebrate employee differences. Organizations may convey their respect
to the backgrounds and traditions of diverse employees. For example, an
organization may have a prayer room for those who so require or hold
potluck parties that celebrate traditions of different nationalities.
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Highlights in HRM 3.8
B asic Co m p o ne nts o f an Effe c tive Se xual H arassm e nt Po lic y
and Exte nsio ns to the Co nc e p t o f H arassm e nt
1. Develop a comprehensive organization-wide policy on
sexual harassment and present it to all current and new
employees. Stress that sexual harassment will not be
tolerated under any circumstances. Emphasis is best
achieved when the policy is publicized and supported by
top management.
2. Hold training sessions with supervisors to explain their
role in providing an environment free of sexual harassment and institute proper investigative procedures when
charges occur.
3. Establish a formal complaint procedure whereby
employees can discuss problems without fear of
retaliation. The complaint procedure should spell
out how charges will be investigated and
resolved.
4. Act immediately when employees complain of sexual
harassment. Communicate widely that investigations will
be conducted objectively and with appreciation for the
sensitivity of the issue.
5. When an investigation supports employee charges,
discipline the offender at once. For extremely serious
offences, discipline should include penalties up to and
including discharge. Discipline should be applied consistently across similar cases and among managers and
hourly employees alike.
6. Follow up on all cases to ensure a satisfactory resolution
of the problem.
The concepts of harassment in the workplace are being broadened to include psychological harassment, such as bullying.
Laws in Quebec and Saskatchewan ban psychological harassment, which is de ned as any repeated, hostile, or unwanted
conduct; verbal comments; actions; or gestures that affect an
employee’s dignity or psychological or physical integrity. This
protection requires employers to create policies to prevent
this type of harassment. Changes in 2016 to the Occupational
Health and Safety Act in Ontario (Bill 132) have made it compulsory for employers to speci cally address sexual harassment in
their policies and procedures.
Though the concept of harassment in the workplace has
continued to evolve, Quebec has decided to take an alternative stance regarding freedom of religious symbols. In 2021,
a Quebec Superior Court judge decided to uphold most of the
provisions introduced in Bill 21. This bill implies that public
employees, such as teachers in the French school board
system, police offers and prosecutors, can be prohibited
from wearing religious symbols at work, including the hijab,
yarmulke, turban, and other religious wear. Teachers from the
English school board and individuals with face coverings in the
provincial legislature were exempted from this bill, though some
argued that this would be appealed next. It was declared that
Bill 21 does not violate the Charter of Rights and Freedoms.
The notwithstanding clause in the charter allows the provincial
legislature to overwrite certain parts of the charter, meaning that
individuals will not have the ability to appeal to those charter
rights that protect their religious rights and freedoms.
Source: Katherine Harding, “Taking Aim at Bullies,” The Globe and Mail (March 19, 2003): C1; Jonathan Montpetit, “In Quebec Religious Symbols Decision,
Canada Confronts Consequences of Controversial Constitutional Clause,” CBC News (April 21, 2021).
4. Listen to employees. Organizations may conduct surveys to assess
employee engagement or create focus groups to discuss engagement and
inclusion issues.
5. Hold effective meetings. There are strategies to ensure that individuals feel
included in meetings. For example, meeting material may be distributed in
advance so that those in which English is a second language can have time
to read ahead of time and provide their input at the meeting. Organizations
may also want to ensure teleworkers are included and the technology is
suf cient for them to participate. Further, ask teleworkers questions to make
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sure they are included in the meeting and schedule meetings at times that
are appropriate to them given the different time zones. Finally, encourage
an active debate and ensure employees are courteous to one another.
6. Communicate goals and measure progress. Create clear, measurable,
speci c, and time-bound inclusion goals. Conduct routine audits and
determine shortcomings and discrepancies.60
Osler, Hoskin & Harcourt, a leading business law rm that was previously
named one of Canada’s best diversity employers, has a quiet room that is offered
for employees who wish to engage in prayer.61 Also, L’Oréal Canada claims
that inter-generational teams are a strength of their company. They offer fullday training through a program called Va lor izin g In ter gen era tion a l Differen ces,
which promotes comprehension and collaboration to understand each generation’s qualities.62
Organizations such as CN, the Bank of Montreal, and Warner-Lambert are
pioneers in the diversity movement. According to Marie Tellier, CN’s former assistant vice president of employment equity, the hiring, development, and good
management of a diverse workforce whose values and expectations are different
from their managers are no longer an option—they are an economic necessity. In
the context of an increasingly diverse labour force, diversity management is not
only a legal obligation but also a necessity imposed by market laws, competition,
and the need to be the best to survive.63
Statistics show that the ethnocultural pro le of Canada has been changing
since the 1960s and will continue to change dramatically over the next 20 years.
European immigrants who led the rst wave of immigration in the early years of
the twentieth century have been surpassed by immigrants from Asia, including
the Middle East.64 A study by Statistics Canada has found that an immigrant’s
country of origin and arrival date in Canada are strongly correlated with their
chances of nding a job. Immigrants born in Southeast Asia and aged 25 to 54
had employment levels close to or better than those of their Canadian-born
counterparts, regardless of when they arrived in Canada.65 The goal of diversity
management is to have the workforce at all levels resemble the population.
CEOs in Canada recognize that ethnic groups possess expertise such as language skills, knowledge of foreign cultures and business practices, and natural
trade links with overseas markets that can be used to capture market share in
emerging economies and new Canadian markets. Joan Vogelesang, CEO of Toon
Boom, a Montreal-based animation software company, claims that many of her
executive team are rst-generation immigrants. Employees at Toon Boom speak 20
languages. Vogelesang explained, “Two of our staff members speak Japanese. You
can hardly do business in Japan if you don’t speak it,” she says.66 The spending
power of these groups is another motivating factor to incorporate them into all
levels of the workforce. According to Roy Gori, President and CEO of Manulife,
“We recognize how important it is to improve the diversity of our organization at
all levels. Establishing goals not only demonstrates our commitment to this important work, it will help us build a more inclusive culture to drive innovation and
enable us to better serve our customers.”67 Digital’s goal is to balance a diversity
strategy with the organization’s business plan. Leslie Stanier, director of human
resources at Cargill in Winnipeg, states, “not only does diversity make the place
more dynamic and interesting for everyone, but having an inclusive culture that
builds on that diversity is what leads to successful business results.”68
Besides the moral issues surrounding diversity, there is a critical economic
need for Canada to increase its share of world trade and expand its trade portfolio (see The Business Case). Our top import and export market is dominated by
the United States, China, Japan, Mexico, and the United Kingdom.69 If Canadian
business continues to rely heavily on these markets, our export growth and standard of living may not keep pace with other international markets.70 Developing
countries in emerging markets will require new investments in infrastructure,
public systems, and productive capital. Given the multicultural background of
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many of its workers, Canada is in an excellent position to provide these services.
Canadian companies such as SNC-Lavalin have already begun to tap the potential
of these emerging markets.
Albeit the strengths of diversity, there may be certain challenges. Culture
misapprehension caused by a lack of understanding of cultural differences and
a failure to adapt is frequent. It might impede the workplace’s functioning, the
welfare of employees, and the integration of employees that might be new to
the country. Therefore, cultivating heightened comprehension is compulsory for
a diverse workforce. This comprehension is referred to as cultural intelligence,
which is de ned as a system of joining comprehension and abilities, connected
by cultural metacognition, that provides individuals with the ability to adapt,
choose, and construct the cultural elements of their environment. It offers the
individual the ability to adapt to new cultural contexts.71
The Business Case
Th e Ec o n o m ic Va lu e s o f D iv e r s it y
Although employment equity and its partner, employment
diversity, were launched on moral grounds, increasingly these
initiatives are sustained on business grounds. The rst principle
to understand is that members of the designated groups are
consumers, not just potential employees. For example, the
purchasing power of people with disabilities is estimated to be
$120 billion. Racial minorities control more than $76 billion of
combined purchasing power. Women control 80 percent of the
consumer dollars spent in North America.
Thesecond business fundamental is that employees who
are members of the designated groups represent an organizational resource that facilitates the understanding and linkages to
these markets by helping various departments to understand the
lifestyles, consumption needs and wants, purchasing preferences,
media use habits, and brand loyalty of these groups. For example,
Phoenix Geophysics Ltd, based in Toronto, credits its newest,
biggest market (Africa) for its geophysical instruments to an
Eritrean-born employee, who speaks ve languages. For reasons
such as this, one in ve businesses has hired an immigrant to
help diversify its global client base. Business is increasingly
international, and employees who speak other languages and
understand other cultures are a valuable resource. A Conference
Board of Canada study found that every 1 percent increase in the
number of immigrants to Canada increased the value of imports
by 0.21 percent and the value of exports by 0.11 percent.
A study of nearly 1,000 companies operating in the
European Union, as well as North America studies, has reported
that a diverse workforce brings these bene ts to business:
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
●
access to a new labour pool;
bene ts related to a company’s reputation;
commitment to equality and diversity as company values;
unlocking of innovation and creativity;
compliance with laws;
competitive advantage;
economic effectiveness;
marketing opportunities;
market growth, capturing new markets;
enhanced customer satisfactions, with 152 percent more
likely to understand diverse clients;
enhanced team understanding of diverse clients;
stimulation of value-driven insights and ideas;
increased productivity;
critical factor driving success in the global market;
attraction and retention of top talent;
rms more competitive; and
increased success of mergers and acquisitions.
Sources: T. Grant, “Tapping Canada’s Immigrant Capital,” The Globe and Mail (May 11, 2011): B7; Terrence Belford, “Hire Local, Think Global,” The Globe and
Mail (January 26, 2009): E1; European Commission, “Business Case for Diversity,” Directorate-General for Employment, Social Affairs, and Equal Opportunity,
Luxembourg (2005); Aparita Bhandari, “Ethnic Marketing—It’s More Than Skin Deep,” The Globe and Mail (September 7, 2005): B3; B. Siu, “Beyond Quotas: The
Business Case for Employment Equity,” Canadian HR Reporter (June 4, 2001): 20; Sylvia Ann Hewlett, Melinda Marshall, and Laura Sherbin, “How Diversity Can
Drive Innovations,” Harvard Business Review (December 2013), https://hbr.org/2013/12/how-diversity-can-drive-innovation, retrieved May 19, 2015; “Global
Diversity and Inclusion: Fostering Innovation through a Diverse Workforce,” Forbes Insights, July 2011, http://www.forbes.com/forbesinsights/innovation_diversity/index.html; S. Kirby and C. Burns, “The Top 10 Economic Facts of Diversity in the Workplace,” Center for American Progress (July 12, 2012), https://www.
americanprogress.org/issues/labor/news/2012/07/12/11900/the-top-10-economic-facts-of-diversity-in-the-workplace/, retrieved May 19, 2015.
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In c lu s io n a r y P r a c t ic e s : C r e a t in g a n En v ir o n m e n t
fo r Su c c e s s
Transforming an organizational culture into a culture that embraces diversity and inclusion can be a comp lex and lengthy p rocess. Diversity initiatives
should be taken slowly so that everyone can understand that this change is
an evolutionary p rocess and that exp ectations should be realistic. Individuals
must fully understand the time, effort, commitment, and risk involved and the
need for a systematic ap p roach. 72 Further, it is a relatively easier feat to identify gap s and set goals and targets to achieve diversity, but inclusion initiatives
require a signi cant change in mindset. 73 A rep resentative workforce does not
suf ce. Emp loyees must also feel a sense of value, equality, and fairness. 74 Th is
discrep ancy between diversity and inclusion is still ap p arent. A McKinsey study
found that 52 p ercent of emp loyees felt p ositively toward their organization’s
diversity efforts, while 31 p ercent felt negatively toward their organization’s
diversity efforts. Alternatively, 29 p ercent felt op timistic about their organization’s inclusion effort, while 61 p ercent held an op p osing viewp oint on their
organization’s efforts. 75
Leadership is one of the most imp ortant variables in an organization’s ability
to successfully incorp orate diversity and inclusion into its business strategy. A
PWC p ulse survey collected information from Chief Human Resources Of cers
(CHROs) in 1,515 United States emp loyees. Th e survey found that 49 p ercent
of HR were leading the task of fostering inclusive leadership at their organizations by escalating efforts to create more inclusive cultures and emp owering
emp loyees to p articip ate in these efforts. 76 Diversity and inclusion initiatives
should not be p erceived strictly as an HR p rogram or p olicy but rather as a
business imp erative. Research has found that leadership that p romotes inclusion mediates the relationship between team diversity and an inclusive climate. 77 In the words of Richard Woo, a CEO of the Russell Family Foundation,
an investment management rm that invests in resources and relationship s
in grassroot leaders, “while the CEO is p ositioned to articulate the vision and
model behaviour, if the CEO neglects diversity, equity, and inclusion in their
vision, then this inaction gives imp licit p ermission for everyone else in the
organization to do the same.”78
Diversity and inclusion initiatives should be linked directly to the business
objectives and goals of the most senior levels of management. Reality Check
demonstrates how RBC manages a wide range of diversity and inclusion initiatives. Organizations seeking to incorp orate the value of diversity and inclusion
into their corp orate p hilosop hy must make use of ap p rop riate internally and
externally focused communications. For examp le, Reitmans brand, Canada’s
largest women’s ap p arel retailer, recently introduced a new camp aign called
Diversity Is the Fabric of Canada. Th e camp aign features seven insp irational
Canadian women from diverse backgrounds and elds. Each of the ambassadors
help ed create a p attern p laced on clothing for sale that re ects the ambassadors’
cultural backgrounds. For each p roduct sold, Reitmans will donate money to
causes chosen by the ambassadors, up to a maximum of $10,000 for each cause.
Further, Reitmans will be offering 10 new Canadian citizens a new wardrobe
worth $1,000 to dress themselves for job interviews, citizenship ceremonies,
holidays, and other events. Th is camp aign is said to reiterate Reitmans’ core
values of inclusion and diversity. “We are committed to making real and lasting
change by using the reach of our brand to continue to advocate for resp ect and
equality. Th is includes creating an inclusive work environment, whether it’s
within our own comp any or across all our marketing camp aigns,” says Jackie
Tardif, President of Reitmans brand and Executive Sp onsor of Diversity and
Inclusion of Reitmans (Canada) Limited. 79
Cross-functional teams established to promote diversity and inclusion initiatives are used successfully as communication vehicles by many leading-edge
organizations. Telus Communications has six Team Member Resource groups that
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external benchmarking to measure its success in diversity and inclusion. In
terms of internal measures, the program collects information on employee demographics and hiring rates in comparison to objectives per group, recruitment,
retention, attrition, employee advancement, engagement, and the amount of completed diversity and inclusion training. The program also assesses the impact of
the training, measures all individuals’ cultural competence, and collects data from
other employee surveys and focus groups. In terms of external information, the
program collects data on customer demographics, clients and service users and
their engagement and retention rates, media exposure, community surveys, and
partnerships with community organizations. The program then creates performance scorecards to track progress regarding its diversity and inclusion goals,
measures organizational performance and the change post-implementation.82
AT&T in the United States fosters diversity and inclusion through its Know
and Grow initiative. This program ensures that all high-potential candidates,
especially members of minorities and women, are given opportunities to work
with senior executives, who are responsible for advising and mentoring them.83
BC Hydro offers online diversity resources and a toolkit through the company’s Intranet website and inclusion through employee activities and celebration
events. Shaw Communications in Calgary established and maintains a national
diversity task force aimed at portraying and advancing Canada’s diverse population, with an emphasis on the four designated groups.84
Figure 3.3 outlines some of the key factors in a diversity management
strategy. Of even greater imp ortance than training is the need to incorp orate
elements of diversity and inclusion into all core training p rograms and to
tailor those elements to meet the needs of sp eci c business units or group s of
emp loyees. 85
An add ed ad van tage of imp lemen tin g a d iversity an d train in g in itiative relates to its imp act on emp loyee reten tion . Reten tion of well-qu ali ed an d skilled emp loyees is an imp ortan t goal, con sid erin g th e amou n t
of resou rces—in both time an d mon ey—sp en t on recru itin g an d h irin g n ew
emp loyees. Accord in g to a su rvey con d u cted by th e Society for Hu man
Resou rce Man agemen t (SHRM), th e average cost-p er-h ire is $4,129, an d th e
time it takes to ll a p osition on average is 42 d ays. 86 A stu dy con d ucted by
Deloitte d iscovered th at over h alf of millen n ials said th at th ey would leave
th eir organ ization for a more in clu sive organ ization , an d on e-th ird of millen n ials h ad alread y left an organ ization for a more in clu sive on e. 87 Main tain in g
a balan ced an d d iversi ed workforce du rin g p eriod s of d own sizin g con tin u es
to be a major ch allen ge. See Figu re 3.4 for a su mmary of th e ben e ts of d iversity man agemen t.
Much th e same as is requ ired u n d er emp loymen t equ ity, an d an overall
review of p olicies an d emp loymen t p ractices mu st be con sid ered . In th is
regard , th e u se of an emp loyee attitud e su rvey may p rove ben e cial in n d in g
areas of systemic or p erceived d iscrimin ation . Th e evaluation criteria often
u sed by organ ization s are legal comp lian ce, staff attitu d es an d en gagemen t,
overall workp lace climate, workp lace learn in g an d d evelop men t efforts, th e
organ ization ’s market imp act, in creases in p romotion s for min ority emp loyees,
a red u ction in th e tu rn over of min ority emp loyees, a red u ction in th e n u mber
of h arassmen t su its, recruitmen t statistics for min orities, an d imp rovemen ts
in p rod u ctivity. 88
A n al elemen t in ach ievin g su ccess is mon itorin g p rogress an d p rovid in g
qu alitative an d qu an titative evid en ce of ch an ge. 89 For examp le, Sail Can ad a,
th e govern in g bod y for th e sp ort of sailin g, h as d evised a tran s in clu sion
p olicy an d h as p led ged to work with tran s ath letes on its imp lemen tation , its
on goin g mon itorin g, an d th e mod i cation of its strategies. Th e p olicy states
th at wh en n ew in formation becomes available, th e govern in g bod y p lan s to
revise th e p olicy. 90 Wh en man agemen t measu res p erforman ce as a fun ction
of d iversity in itiatives, values are in stilled in th e min d s of all emp loyees, an d
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F ig u r e 3 .3
M o d e l o f Dive rsity M anag e m e nt Strate g y
VALUING DIVERSITY IN THE WORKPLACE
Culture
Opportunity
Leadership
Organization-Wide Image
Organization fosters
mutual respect
Organization fosters
sense of belonging
Differences are accepted
Corporate-wide
diversity-training program
Career Development
Promotion of multicultural
employees
Opportunity for
development of new skills
Preference to minorities in
promotion
Access to top
management positions
Management Practices
Take all employees
seriously
Recognize the capabilities
of all employees
Support all employees
Communicate effectively
with all employees
Value a diverse work
group
Respect the cultural
beliefs and needs of
employees
Accept
non–English-speaking
employees
Concern for Equality
Equal respect for minority
and majority group
Equal performance
expectations for minority
and majority group
Equal rewards for minority
and majority group
Equal pay and income
Valuing diversity
Hiring Practices
Active recruitment and
hiring of multicultural
employees
Equal opportunities for
minorities
Employment equity
program
Sources: Reprinted from The Cornell Hotel and Restaurant Administration Quarterly (41, no 2); Kathleen Iverson, “Managing for Effective Workforce Diversity,”
pp. 31–38, © 2000, with permission from Elsevier.
F ig u r e 3 .4
W hy Dive rsity?
The primary business reasons for diversity management include . . .
Better utilization
of talent
Increased
marketplace
understanding
Increased
quality of team
problem solving
Enhanced
creativity
Breadth of
understanding in
leadership positions
Source: Survey data from Gail Robinson and Kathleen Dechant, “Building a Business Case for Diversity,” Academy of Management Executive 11, no. 3
(August 1997): 21–31.
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it is d emon strated th at ch an ge an d d iversity are p art of d ay-to-d ay bu sin ess.
To ach ieve su ccess in d iversity, it is vital to set an examp le an d to create an
atmosp h ere th at resp ects an d values d ifferen ces. Can ad ian organ ization s h ave
recogn ized th e comp etitive advan tage of embracin g d iversity an d in clu sion in
th eir bu sin ess strategies.
Check In
What effects, if any, do you think diversity management and inclusion practices have on the competitiveness of Canadian businesses? What are the positives? Are there any negatives? How would
you mitigate the negatives, if any?
Small Business Application
As we have already said, small businesses are bound to the
same legislation regarding workplace standards as are large
companies. Although there are some exclusions, such as
employers of less than 100 employees being excluded from the
Employment Equity Act, small business needs to ensure that
practices applying to recruitment, pay, and workplace standards
treat all Canadians fairly and equitably and in accordance with
the Canadian Charter of Rights and Freedoms. In addition to
legal compliance, equitable treatment of staff is good business.
But how does small business achieve this? Through
the operation of three principles: (1) diverse and inclusive
recruitment, (2) equal pay for work of equal value, and
(3) maintaining a harassment-free workplace.
To illustrate how this plays out in small companies, let’s use
an example of a retail store in Surrey, British Columbia. Retail
business relies on the local community as the primary source of
customers, as well as employees. Part of being able to serve clients successfully comes as a result of understanding the needs of
customers and providing an environment sensitive to their speci c
needs. As such, to serve the diverse population of Surrey, this store
is well served by hiring staff that re ects this diverse population.
The same is true for gender and people with disabilities. Given
equivalent quali cations, many organizations will hire candidates
from the designated groups to ensure that their organizations’
employees are representative of the Canadian population.
So, what strategies can this small business employ
to maintain a diverse workforce? First, management can
ensure that all people involved in the selection and support of
employees recognize the value of maintaining a diverse representative workforce. Second, they can employ simple attraction
strategies such as placing an “Employee Wanted” sign in the
window of the store to draw from the diverse local community.
Lastly, they can take measures to ensure the management of an
inclusive workplace. This can include ensuring equitable wage
124
treatment of staff based on position and performance, as well
as providing workplaces that are supportive to all employees.
Although equal pay for equal work is quite complex in large
organizations, in small companies, often the exercise is quite
easy. In our retail store in Surrey, we could set salary ranges for
retail staff based on the regional norms for this work and then
set guidelines within that range based on work experience and
performance history.
Finally, harassment in the workplace, whether sexual or
bullying in nature, is both illegal and destructive. Employers
have the obligation to provide a safe work environment, free
from such activity. Small employers are bound to the same legal
requirements as large companies in this regard. In addition to
legal compliance, protecting workplaces from such behaviour
guards employers from productivity decreases in the form of
absenteeism, turnover, and decreased work performance.
Ensuring a harassment-free workplace requires a
leadership commitment to this priority, a monitoring of the
environment to ensure that harassment is not taking place,
and immediate and effective actions to address harassment
in the workplace if it is discovered. In the case of our retail
store in Surrey, the store manager is responsible for both
hiring and ensuring that the workplace is harassment free.
Recognizing that they would not have an HR generalist to support them, this store could employ a three-pronged approach
to ensuring an inclusive workplace. First, the store manager
could participate in diversity and harassment training offered
by many third-party training providers. Second, the store can
seek to eliminate bias in hiring selection by involving someone
other than the store manager in the selection process. Lastly,
the store can measure turnover and conduct exit interviews to
assist in the identi cation of problems needing resolution.
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Summary
Outcome 1 Employmen t equ ity refers to the employment of individuals in a fair and nonbiased manner.
Four groups in Canada—women, visible minorities,
Indigenous Peoples, and people with disabilities—
tend to be concentrated in a few occupations that are
accorded lower status and pay.
Outcome 2 Th e Ca n a d ia n Hu m a n Righ ts Act ap p lies
to all fed erally govern ed d ep artmen ts an d agen cies
an d all organ ization s in corp orated u n d er fed eral
ju risd iction . Th e Act p roh ibits d iscrimin ation on
th e basis of grou n d s su ch as race, religion , sex,
age, n ation al or eth n ic origin , p h ysical h an d icap ,
an d marital statu s. Th e Ca n a d ia n Cha r ter of Righ ts
a n d Fr eed om s gu aran tees some fu n d amen tal
righ ts to every Can ad ian , in clu d in g freed om from
d iscrimin ation . CHRC en forces th e Act th rou gh a
formal comp lain t p roced u re.
Outcome 3 At the federal level, pay equity involved an
amendment to the Ca n a dia n Hu ma n Rights Act that
makes it illegal for employers to discriminate against
individuals on the basis of job content. A new Pa y
Equ ity Act (2018) is proactive and came into effect
August 2021. By de nition, pa y equ ity means equal pay
for work of equal value.
Outcome 4 Th e Employmen t Equ ity Act requires all
federally regulated emp loyers to p rep are an emp loyment equity p lan that identi es areas in which
members of the designated group s are over- or underrep resented and establishes p lans to p romote an equitable workp lace. Th e imp lementation of emp loyment
equity involves six step s: senior management sup p ort,
data collection and analysis, an emp loyment systems
review, establishment of a workp lan, imp lementation,
and a follow-up p rocess that includes monitoring,
reviewing, and revision.
Outcome 5 Sexual harassment is an employment equity
issue undergoing continued debate.
Outcome 6 Managing diversity does more than incorporate employment equity. The goal of diversity and
inclusionary management is to optimize the utilization
of an organization’s multicultural workforce.
Key Terms
bona de occupational quali cation diversity management, 116
(BFOQ), 97
employment equity, 94
ow data, 109
concentration, 110
reasonable accommodation, 112
designated groups, 102
sexual harassment, 114
stock data, 109
systemic discrimination, 111
underutilization, 110
Discussion Questions
1. Here are some myths about employment equity:
It leads to hiring unquali ed workers.
It causes an overnight change in the workforce
makeup.
It is a plan that would make Calgary’s workforce
look like Toronto’s.
This program lays off white males to make
room for designated group members.
It is a program mainly for racial minority
groups.
Employers who implement the plan can destroy
hard-won seniority provisions that protect all
workers.
It is the end of hiring for white males.
In groups, determine whether group members
share these beliefs. As HR professionals, how would
you work with employees who hold these beliefs?
2. Although the process for ling a complaint of
discrimination appears clear, many would choose
not to do so. List the reasons alleged “victims”
of discrimination in employment might not le a
complaint.
3. Fin d a male class job (i.e., a job in w h ich
th e majority of workers are male) an d a
female class job th at seem to req u ire similar
ed u cation al b ack grou n d an d tech n ical sk ills.
(For examp le, comp are female-d omin ated
p olice d isp atch ers w ith male-d omin ated rad io
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tech n ical su p ervisors or female-d omin ated
h ealth tech n ician s w ith male-d omin ated
tran sp ortation workers.) Th en , u sin g an
In tern et salary comp en sation in d ex, calcu late
th e p ay rates. Are th ere d ifferen ces? How wou ld
you accou n t for th ese d ifferen ces?
4. List as many jobs as you can in which you could
hire only male applicants, based on a BFOQ.
5. Have you ever encountered questions such as the
following:
“Do you really think you could handle this
job? You know it takes a lot of energy and
enthusiasm. Besides, we are looking for
someone with career potential.”
“You don’t need this training program. At your
age, what would the bene t be?”
“Well, you are getting on. What do you expect at
your age?”
Such comments re ect ageism—an attitude
th at makes assump tions about older p ersons
and th eir abilities and p uts labels on th em. A
relatively large p ercentage of Canada’s workforce
is aged 55 and over. Th ey are often stereotyp ed
and not h ired or p romoted. Using wh at you
h ave learned in th is ch ap ter about h iring and
accommodating th e four designated group s,
design a recruitment and retention p rogram for
older workers.
6. Have each member of your group complete the
following survey. Discuss the ndings.
Activity
Is This Sexual
Harassment?
Employees post cartoons on bulletin boards
containing sexually related material.
Yes
No
Amale employee says to a female employee
that she has beautiful eyes and hair.
Yes
No
Amale manager habitually calls all female
employees “sweetie” or “darling.”
Yes
No
Amale manager fails to promote a female
employee when she will not grant sexual
favours.
Yes
No
Male employees use vulgar language and tell
sexual jokes that are overheard by, but not
directed at, female employees.
Yes
No
Amale employee leans and peers over the
back of a female employee when she wears
a low-cut dress.
Yes
No
Asupervisor gives a female (male) subordinate a nice gift on her (his) birthday.
Yes
No
Two male employees share a sexually explicit magazine while observed by a female
employee.
Yes
No
7. Describe how an organization can make best use
of a multicultural workforce.
HRM Experience
Yo ur Op inio ns ab o ut Em p lo ym e nt Eq uity
First, complete the survey below. Then discuss your answers with
members of a study group. Try to determine which statement is a
myth and which represents reality.
To what extent do you agree with the following statements, on a
scale of 1 to 5?
1
2
3
4
5
Strongly
disagree
Disagree
Ambivalent
Agree
Strongly
agree
1. Employmen t equ ity means that everyone must be treated
the same way. _____
2. Employment equity results in “reverse discrimination.” _____
3. Employment equity is a matter of quotas. _____
4. Employment equity means that unquali ed people must be
recruited. _____
5. Employment equity threatens the principle of seniority. _____
6. Employment equity is equivalent to lowering employment
standards. _____
7. It is too dif cult and too costly to adapt the workplace to
meet the needs of persons with disabilities. _____
8. Employment equity is only achievable in a prosperous
economy. _____
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Case Study 1
Study Fighting Fires
zorandimzr/ iStock/ Getty Images
In British Columbia,
the competition for
re ghting jobs is
erce, with more
than 1,600 people
applying for about 60
jobs. At one time, the
provincial Ministry of
Forests required all
job applicants to pass this physical tness test:
Lift a 23-kilogram bar in an upright rowing motion
18 times.
Carry pumps and hoses, weighing as much as 50
kilograms, over a timed distance.
Perform a shuttle run, which involves darting back
and forth at an increasingly faster pace between
cones situated 20 metres apart.
The B.C. Government and Service Employees Union
argued that the average man, with training, could easily
pass the test, whereas the average woman, even with
training, could not. Only 35 percent of women who
applied for the re ghter’s job passed the test; about 70
percent of the men did.
The University of Victoria scientists who designed
the tests argued that most women could reach the standard, although they would have to work harder than
most men to do so. Female re ghters said they had to
train year-round to pass the test, but they took this as
a personal responsibility and as the cost of qualifying
for the job. Their safety, as well as that of their colleagues and the public, depends on their strength and
endurance. The B.C. Ministry of Forests spokeswoman
suggested that lowering the standards would be a mistake: “Already male re ghters are asking if blazes will
be designated as ‘guy’ res and ‘girl’ res. We want the
ttest people.”
Questions
1. Did the standards result in safer and more effective
re ghting crews, or were they inadvertently
keeping women out of a traditionally male job?
2. Was this a BFOQ? The ministry was challenged
on the basis of sex discrimination. What did the
Supreme Court rule, and what was its reasoning?
3. Female applicants had the chance to train and try
the test at B.C. university campuses. Was this special preparation discriminatory?
4. Did the changes made x the underlying problems?
Explain.
Sources: “New Test for Reasonable Accommodation,” Canadian HR Reporter, http://www.cdn-hr-reporter.ca/hr_topics/systemic-discrimination/new-test-reasonableaccommodation, retrieved July 9, 2012; Lesley Young, “Employers Need to Scrutinize All Job Testing for Human Rights Violations, Supreme Court Rules,” Canadian HR
Reporter 12, no. 17 (October 4, 1999): 3.
Case Study 2
Outreach Efforts
Hill Street Studios/ DigitalVision/ Getty
Images
Currently, Indigenous
individuals make up
about 20 percent of
Manitoba
Hydro’s
workforce. In northern
Manitoba, where there
is a greater concentration of Indigenous
Peoples, 48 percent
of the corporation’s
workforce is Indigenous. The creative ways in which
the company works to achieve diversity and inclusion
include the following:
a zero-tolerance policy of workplace harassment
and discrimination;
an outreach and partnership program with
Indigenous organizations to provide information
about employment and training opportunities;
partnerships with postsecondary institutions to
provide educational programs and career information and to brand Manitoba Hydro as an employer
of choice;
a review of training programs to ensure that there
are no systemic barriers; and
systematic recruitment efforts to introduce
Indigenous individuals by means of internships,
co-op placements, summer employment, and parttime work.
The most successful program is the preemployment
training designed to facilitate the entry of Indigenous
individuals into Manitoba Hydro’s training programs,
which are more like apprenticeship programs. The
preemployment training provides academic upgrading,
a rotation through three trades to familiarize candidates
with these jobs, and workshops to deal with the concerns and issues about being away from home. Another
innovative program is the utility’s “Building the Circle
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Camp,” which introduces girls in northern Manitoba to
opportunities in engineering, technology, and trades.
Nonetheless, Manitoba Hydro’s diversity and inclusion
efforts have not come without setbacks. For example,
recently a complaint led by A Nisichawayasihk Cree
Nation member, Ken Linklater, who had worked for
Manitoba Hydro for eight years, alleges that his supervisor made racist remarks on multiple occasions. A year
prior, a complaint had been made, and the company
stated that they had conducted an investigation and
presented recommendations at a meeting. However,
Linklater resigned, and thus far, the supervisor is still
employed at Manitoba Hydro. Further, Indigenous communities have protested at the front of Manitoba Hydro’s
of ce in Winnipeg to complain about the impacts of
the hydroelectric dams on their communities. Thus,
there are strides to take to ensure Manitoba Hydro fully
fosters a diverse and inclusive environment.
SaskTel is a Crown corp oration p roviding cellular, p h one, Internet, and multimedia services
to 13 cities and more th an 500 remote communities in Saskatch ewan, many of th em inh abited by
First Nations and Métis p eop le. SaskTel cares about
th e Indigenous p op ulation as both customers and
emp loyees (9.3 p ercent of SaskTel’s workforce is
Indigenous). Th e comp any’s Indigenous recruitment
strategy is to increase th eir Indigenous workforce
th rough p artnering with community organizations
and p ost secondary institutions, career fairs, and networking events. Th e comp any’s call centre can offer
service in th ree different First Nations languages.
The Thunder Bay Police are increasing outreach
efforts to improve the hiring of Indigenous individuals,
whose representation is currently slightly under the city’s
census. About 8 percent of the of cers are Indigenous
compared to 13 percent of Thunder Bay’s residents.
However, the police service is also targeting Indigenous
individuals in surrounding communities. Staff Sergeant
Gordon Snyder and Amanda Wilson, the human resources
specialist, have travelled over 3,600 kilometres to introduce and advertise the police force to high schools, postsecondary institutions, and First Nations communities
in Northwestern Ontario, Manitoba, and Saskatchewan.
Due to their outreach efforts, they have discovered
the barriers that prevent Indigenous individuals from
applying to join the police force. In Kiashke Zaaging
Anishinaabek (Gull Bay First Nation), the online application process was less feasible due to the community’s
limited Internet access. Therefore, a liaison was offered
for anyone who wished to apply. In another example,
the online process removed barriers as previously, preapplication testing was done in person only one or two
times a year. Some students were therefore unable to
apply previously. The outreach services have also been
informational for the community and have raised awareness of the Thunder Bay police. Some Indigenous individuals may not have been aware of municipal police
as their communities have only come into contact with
RCMP or Ontario Provincial Police.
Questions
1. What are the reasons cited by the companies for
wanting to hire Indigenous individuals?
2. Of the initiatives described in the case, which do
you think will be most successful to achieve these
objectives? Why?
Sources: Dianne Jermyn, “A Bridge between Two Worlds,” The Globe and Mail (May 18, 2011): E3; “Diversity: Mastering Aboriginal Inclusion,” HR Professional
(June/July 2009): 13; Shannon Klie, “Short Circuiting the Labour Supply,” Canadian HR Reporter 21, no. 22 (December 15, 2008): 6; Laura Bogomolny, Peter Evans, Andy
Holloway, Zena Olijnyk, Erin Pooley, and Andrew Wahl, “The Best Workplaces in Canada,” Canadian Business (April 10–23, 2006): 74; Cheryl Petten, “Manitoba Hydro
Recognized for Employment Equity Efforts,” Windspeaker 20, no. 4 (August 2002): 31; Thompson Citizen, “Manitoba Hydro Wuskwatim Employee Files Complaint, Resigns,
Citing Racist Behaviour by Supervisor,” (December 10, 2020); Glen Dawkins, “Indigenous Leaders, Activists Take Protest to Manitoba Hydro’s Doorstep,” Winnipeg Sun
(November 11, 2019); Sasktel, “Rooted in Saskatchewan, 2017/2018 Corporate Social Responsibility Report,” https://www.sasktel.com/wps/wcm/connect/84ccc29bd5a8-430b-ab59-fd31c981ebe9/2017-18-csr-report.pdf?MOD=AJPERES&CVID=mkl4e4a, retrieved May 25, 2021; Richard Yerema and Kristina Leung, “2021 Canada’s
Top 100 Employers, Sasktel,” (November 12, 2020), https://reviews.canadastop100.com/top-employer-sasktel; Marsha McLeod, “Thunder Bay Police Step Up Efforts to
Recruit Indigenous Of cers,” The Globe and Mail (March 6, 2020).
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Case Study 3
Women on the Right Track at CP Rail
M.J. Daviduik/ Alamy Stock Photo
Women
comprise
nearly half of Canada’s
workforce, but over
the last two decades
they have made no
progress in obtaining
senior
management
roles. This lack of
success may deter younger women from entering certain professions and from learning from role models.
Furthermore, research shows that a lack of diversity
can affect retention, productivity, and innovation.
Companies with more female senior managers have a
higher return on equity than those with lower rates of
female senior managers. With this research in mind, CP
Rail undertook four initiatives to increase the number
of women managers:
Each department must have diversity goals.
Mentoring programs for females have been
established.
Senior women discuss their careers in forums.
Women on Track offers networking opportunities.
To date, the program has been successful, with the
number of women in senior management doubling
over ve years.
Questions
1. Compare CP Rail’s initiatives to advance women
with the recommended six-step program for the
implementation of employment equity.
2. Review the list of retention strategies in
Highlights in HRM 3.1. What more could
CP Rail undertake?
Source: Tavia Grant, “How CP Put Women on the Executive Track,” The Globe and Mail (September 1, 2011): B1.
Notes and References
1. Statistics Canada, “Immigration and Ethnocultural
Diversity: Key Results from the 2016 Census,” http:/ /
www.statcan.gc.ca/ daily-quotidien/ 171025/ dq171025beng.htm, retrieved May 10, 2021.
2. Allison Konrad, Yang Yang, and Cara Maurer,
“Antecedents and Outcomes of Diversity and Equality
Management Systems: An Integrated Institutional
Agency and Strategic Human Resource Management
Approach,” Hu ma n Resou rce Ma n a gemen t 55, no. 1
(2016): 83–107.
3. Victor S. Mackinnon, “Th e Canadian Ch arter of Righ ts
and Freedoms,” Pu blic Ad min istr a tion : Ca n a d ia n
Ma ter ia ls (North York, ON: Cap tus Press, 1993):
179–80.
4. Victor S. Mackinnon, “The Canadian Charter of Rights
and Freedoms.”
5. Ca n a dia n Hu ma n Rights Act, Canadian Human Rights
Commission, 1978, Paragraph 2, Subsection (a).
6. A. P. Aggarwal, Sex Discr imin a tion : Employmen t
La w a n d Pra ctices (Toronto: Butterworths Canada,
1994).
7. Nicole Crescenzi, “Victoria Man Wins Record-Breaking
Human Rights Tribunal Case,” Victor ia News ( June 14,
2019).
8. Ca n a dia n Hu ma n Rights Act, Paragraph 60, Section
2(a), (b).
9. Alex Ballingall, “Ottawa Working Out Details of Pay
Equity Legislation Announced in Budget,” Tor on to
Sta r (March 13, 2018); Kathryn May, “Liberals Promise
‘Proactive’ Pay Equity Legislation to Close Wage Gaps,”
Otta wa Citizen (October 5, 2016), http:/ / ottawacitizen.
com/ news/ national/ liberals-promise-proactive-payequity-legislation-to-close-wage-gaps, retrieved April
21, 2018; Government of Canada, “Government of
Canada Announces That the Pa y Equ ity Act Will Come
into Force on August 31, 2021,” ( July 7, 2021), https:/ /
www.canada.ca/ en/ employment-social-development/
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10. Statistics Canada, “Women and Paid Work,” http:/ / www.
statcan.gc.ca/ pub/ 89–503-x/ 2015001/ article/ 14694eng.htm, retrieved April 21, 2018; Tavia Grant, “Who
Is Minding the Gap?” The Globe a n d Ma il (March
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Chap t er 3: E q u i t, y Di v e r s i t, y a n d I n c l u s i o n : T h e L e g a l E n v i r o n m e n t
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11. Russel J. G. Juriansz, Equ a l Pa y Legisla tion a n d
On ta r io’s New Pa y Equ ity Act (Toronto: Blake, Cassels &
Graydon, 1995): 3–5.
12. P. Singh and P. Peng, “Canada’s Bold Experiment with
Pay Equity,” Women in Ma n a gemen t—An In ter n a tion a l
Jou r n a l 25, no. 7 (2010): 570–85; Susan Riggs,
“Comparing Apples and Oranges: Job Evaluations,”
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13. “Achieving Pay Equity First Goal, But through
Co-operation: Commissioner,” Pa y Equ ity Commission
Repor t 1, no. 1 (March 1988): 6.
14. Morley Gunderson and Roberta Edgecombe Robb, “Equal
Pay for Work of Equal Value: Canada’s Experience,”
Adva n ces in In du stria l a n d La bou r Rela tion s 5 (1991):
151–68. See also John G. Kelly, Pa y Equ ity Ma n a gemen t
(Toronto: CCH Canadian, 1988): 45–54.
15. Equal Pay Coalition, “Ontario,” http:/ / www.equalpaycoalition.org/ history/ ontario/ , retrieved May 2015; David
Brown, “New Rules Proposed for Pay Equity,” Ca n a dia n
HR Repor ter (May 31, 2004): 1, 2.
16. The term Abor igin a l is used in some instances in this
chapter to be consistent with the usage in the Cha r ter,
the Census, and the Employmen t Equ ity Act.
17. Len Karakowsky and Natalie Guriel, The Con text of
Bu sin ess: Un der sta n din g the Ca n a dia n Bu sin ess
En vir on men t (Toronto: Pearson Canada Inc., 2015).
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Much More Work to Do,” The Globe a n d Ma il (March
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21. Ryerson Today, “Indigenous Skills Training and
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23. Can ad ian Hu man Righ ts Commission , “Sign i can t
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24. L. Redpath and M. O. Nielsen, “A Comparison of Native
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25. Conference Board of Canada, “Working Together.
Indigenous Recruitment and Retention in Remote
Canada” (2019).
26. Shannon Klie, “Aboriginals a Strategic Imperative,”
HR Repor ter (April 25, 2011): 8.
27. Statistics Canada, “Making an Accessible Canada for
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28. CBC News, “Advocates Say People with Disabilities
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30. Statistics Canada, “Making an Accessible Canada for
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31. Greg Thompson, “Funding for Workplace
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More Educated,” Va n cou ver Su n (March 4, 2016).
34. Tina Chui and Helene Maheux, “Women in Canada: A
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35. Statistics Canada, “Unemp loyment Rate, by Visible
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36. Sarah Dobson, “Emp loyers’ Focus on Emp loyment
Equity Recognized by Government Awards,”
Ca n a d ia n HR Repor ter 29, no. 8 (May 2, 2016): 9, 12;
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37. In tr odu ction to Employmen t Equ ity (Ottawa:
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cibc-once-again-named-one-of-canada-s-best-diversityemployers.
43. Bureau of Labour Information, Employment and Social
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44. Towa rds Equ ity: 1993 Merit Awa rds, 11–12; Laura Cassiani,
“Canada’s Quiet Labour Crisis,” Ca n a dia n HR Reporter
14, no. 3 (February 12, 2001): 1, 8; Cameco, “Cameco
Corporation Pre-Budget Submission to the 2017–2018
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45. L. Young, “Employers Need to Scrutinize All Job Testing
for Human Rights Violations, Supreme Court Rules,”
Ca n a dia n HR Repor ter (October 4, 1999): 3.
46. Ibid, 18.
47. Aggarwal, Sex Discr imin a tion .
48. Treasury Board of Canada Secretariat, “Embracing
Change in the Federal Public Service—Task Force on
the Participation of Visible Minorities in the Federal
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49. Employmen t Equ ity: A Gu ide for Employer s, c4.
50. John Dujay, “Amazon Sees Success in Supporting Workers
with Disabilities,” HR Repor ter (December 18, 2020).
51. David Doorey, “Employer Bullying.”
52. Seymour Moskowitz, “Adolescent Workers and Sexual
Harassment,” La bor La w Jou rn a l 51, no. 3 (Fall 2000):
78–84. For an excellent reference guide on sexual harassment, see William Petrocelli and Barbara Kate Repa,
Sexu a l Ha ra ssmen t on the Job: Wha t It Is a n d How to
Stop It (Berkeley, CA: Nolo Press, 1998); Howard Levitt,
“Workplace Investigations into Sexual Harassment Are
Often Biased or Botched,” Fin a n cia l Post (April 28, 2021).
40. Ca n a dia n Hu ma n Rights Act, S.C. 1976–77, c. as
amended.
53. Canadian Advisory Council on the Status of Women,
“Sexual Harassment,” CACSW Fact Sheet, March
1993; Harrison Mooney, “Half of Canadian Women
Experience Workplace Sexual Harassment, Says New
Poll,” Va n cou ver Su n (December 6, 2017), http:/ /
vancouversun.com/ news/ local-news/ half-of-womenexperience-workplace-sexual-harassment-far-fewer-thanhalf-report-it-says-new-poll, retrieved April 21, 2018.
41. R. G. L. Fairweather, Canadian Human Rights
Commission, The Sta n din g Committee on Lega l a n d
Con stitu tion a l Affa ir s (May 29, 1986): 10.
54. “Inquest Probes Murder–Suicide Involving Harassment
Victim,” Sexu a l Ha ra ssmen t, Workpla ce Diver sity Upda te
5, no. 3 (March 1997): 4.
42. “CIBC Once Again Named One of Canada’s Best
Diversity Employers,” CNW (February 10, 2014),
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55. Tyler Dawson, “Trudeau Foundation Tried to Silence
Sexual Harassment Allegation, Woman Claims in $1.25M
Lawsuit,” Na tion a l Post (May 26, 2021).
38. Employmen t Equ ity Act, http:/ / laws.justice.gc.ca/ en/ E5.401/ 48928.html, retrieved July 30, 2009.
39. Tennile Cooper, “Four Ways to Cultivate Diverse
Candidate Pools,” The Globe a n d Ma il (May 25, 2021).
Chap t er 3: E q u i t, y Di v e r s i t, y a n d I n c l u s i o n : T h e L e g a l E n v i r o n m e n t
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56. Brian Hill, “Number of RCMP Sexual Harassment,
Discrimination Claims Rises to 2,400 Women,” Globa l
News ( January 26, 2018), https:/ / globalnews.ca/
news/ 3988233/ rcmp-sexual-harassment-claims-rise/ ,
retrieved April 21, 2018; Rachel Houlihan and Dave
Seglins, “RCMP Harassment Claims Could Hit 4,000 in
Wake of #MeToo, Lawyers Say,” CBC News ( January
31, 2018), http:/ / www.cbc.ca/ news/ investigates/ rcmpharassment-claims-could-hit-4-000-in-wake-of-metoolawyers-say-1.4510891, retrieved April 21, 2018.
57. HR Proactive Inc., “Sexual Harassment in the Workplace,
What Is Bill 132?” https:/ / bill132.ca/ , accessed May 21,
2021.
58. For a good review of sexual harassment policy, see
Dana S. Connell, “Effective Sexual Harassment Policies:
Unexpected Lessons from Jacksonville Shipyards,”
Employee Rela tion s La w Jou r n a l 17, no. 2 (Autumn
1991): 191–205.
59. Dana Brownlee, “Th e Dangers of Mistaking Diversity
for Inclusion in the Workp lace,” For bes (Sep tember 15,
2019).
60. Kathy Gurchiek, “6 Steps for Building an Inclusive
Workplace,” SHRM (March 19, 2018).
61. Osler, “Diversity as Osler: 2016 Year in Review,” https:/ /
www.osler.com/ osler/ media/ Osler/ reports/ corporategovernance/ Diversity-in-the-workplace-Osler-2016.pdf,
retrieved May 27, 2021.
62. Postmedia News, “L’Oreal Canada Considers
Inter-Generational Teams a Strength,” Fin a n cia l Post
(May 15, 2013).
63. Jennie Constantinides, “Diversity Management: At
CN, the ‘Token’ Will Be Broken,” Hu ma n Resou rces
Pr ofession a l 7, no. 4 (April 1991): 29–30; Darren
T. Baker and Elisabeth K. Kelan, “HRM Practices to
Diversity Management,” in David G. Collings, Geoffrey
T. Wood, Leslie T. Szamosi (eds.), Hu ma n Resou rces
Ma n a gemen t: A Cr itica l Appr oa ch (New York:
Routledge, 2018): 117.
64. Statistics Canada, “Immigration and Ethnocultural
Diversity: Key Results from the 2016 Census,” http:/ /
www.statcan.gc.ca/ daily-quotidien/ 171025/ dq171025beng.htm, retrieved April 21, 2018; Statistics Canada,
Ca n a da ’s Ethn ocu ltu ra l Por tra it: The Cha n gin g Mosa ic,
http:/ / www12.statcan.ca/ english/ census01/ products/
analytic/ companion/ etoimm/ pdf/ 96F0030XIE2001008.
pdf, retrieved March 2015; Erin Anderson, “Immigration
Shifts Population Kaleidoscope,” The Globe a n d Ma il
( January 22, 2003): A6.
65. Statistics Canada, Ca n a da ’s Ethn ocu ltu ra l Por tra it.
66. Jana Schilder, “The Rainbow Connection: Employers
Who Promote Diversity May Discover a Pot of Gold,”
HR Pr ofession a l 11, no. 3 (April 1994): 13–15; Nancy
Langton. Or ga n iza tion a l Beha viou r: Con cepts,
Con tr over sies, Applica tion s, Seven th Ca n a dia n
Edition Plu s NEW MyMa n a gemen tLa b with Pea r son
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67. Manulife Financial Corporation, “Manulife Sets Goals
to Increase BIPOC Recruitment and Leadership
Representation as Part of Five-Year Diversity,
Equity & Inclusion Plan,” Newswire ( July 17, 2020),
https:/ / www.prnewswire.com/ news-releases/
manulife-sets-goals-to-increase-bipoc-recruitmentand-leadership-representation-as-part-of- ve-yeardiversity-equity--inclusion-plan-301095231.html.
68. Sarah Dobson, “Employers’ Focus on Employment
Equity Recognized by Government Awards,” Ca n a dia n
HR Repor ter (May 2, 2016): 12.
69. World Integrated Trade Solution, “Canada Monthly Trade
Data,” https:/ / wits.worldbank.org/ countrysnapshot/ en/
can, accessed May 28, 2021.
70. Doug Nevison, “Pro ting in the Paci c Rim: Can
Canada Capture Its Share?” Con feren ce Boa rd of
Ca n a da Repor t (1994): 117–94; Jonathan Montpetit,
“Quebec Wants to Ready Businesses for ‘New World’ of
Protectionism That Will Follow Pandemic,” CBC (April
13, 2020), https:/ / www.cbc.ca/ news/ canada/ montreal/
covid-19-quebec-economy-protectionism-1.5528781.
71. Malik, Amina R., Helena D. Cooper-Thomas, and Jelena
Zikic, “The Neglected Role of Cultural Intelligence
in Recent Immigrant Newcomers’ Socialization,”
In ter n a tion a l Jou r n a l of Cr oss Cu ltu ra l Ma n a gemen t
14, no. 2 (2014): 195–213.
72. R. Roosevelt Thomas, Jr., “Beyond Race and Gender,”
AMACOM (1991): 34.
73. Dana Brownlee, “Th e Dangers of Mistaking Diversity
for Inclusion in theWorkp lace,” Forbes (Sep tember 15,
2019).
74. McKinsey & Company, “Diversity Wins, How Inclusion
Matters,” (May 2020), https:/ / www.mckinsey.com/ ~/
media/ mckinsey/ featured%20insights/ diversity%20and%20
inclusion/ diversity%20wins%20how%20inclusion%20matters/ diversity-wins-how-inclusion-matters-vf.pdf.
75. Ibid.
76. SAP, “HR Transformation: Why Diversity, Equity, and
Inclusion Is Here to Stay,” Forbes (May 24, 2021).
77. Tanachia Ashikali, Sandra Groeneveld, and Ben Kuipers,
“The Role of Inclusive Leadership in Supporting an
Inclusive Climate in Diverse Public Sector Teams,”
Review of Pu blic Per son n el Admin istra tion 41, no. 3
(2020).
78. Philanthropy Northwest, “Vision and Voice,” D5
Coa lition , https:/ / www.d5coalition.org/ wp-content/
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79. Reitmans (Canada) Limited, “Reitmans Celebrates
Cultural Diversity With Its New Campaign, ‘Diversity Is
the Fabric of Canada’,” Newswire (May 20, 2021).
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80. Telus, “Diversity and Inclusion,” https:/ / www.telus.com/
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81. Imperial Oil, https:/ / www.imperialoil.ca/ en-CA/ Careers/
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82. Leslie Young, “Global Diversity Standard in Works,”
Ca n a dia n HR Repor ter (April 5, 1999): 1.
83. “Global Diversity and Inclusion: Fostering Innovation
through a Diverse Workforce,” Forbes In sights ( July
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84. “Canada’s Best Diversity Employers for 2013,” Globe a n d
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85. Claudine Kap el, “Variation Is the Th eme: Organizations
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Productivity,” HR Pr ofession a l 1, no. 3 (Ap ril
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87. The Leadership Center for Inclusion, “Unleashing the
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88. Greg Morris, “Research and Measurement,” Diver sity
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89. Young, “Global Diversity Standard in Works.”
90. Sail Canada, “Equity, Accessibility, Diversity and
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As the world grapples with new phenomena, including the COVID-19 pandemic,
organizations face a more complex, highly dynamic, and increasingly competitive
business environment. Rapidly changing technology, changing demographics,
shifts in consumer tastes and preferences, emphasis on a team-based approach,
and a globalized business environment, among other drivers of change, continue
to force organizations to “reengineer” themselves to gain competitive advantage
and pro tability.1 The goal is to become more ef cient and effective. There is
emphasis on smaller scale, less hierarchy, fewer layers, and more decentralized
work units.2 As organizational reshaping takes place, managers want employees
to operate more independently and exibly to meet customer demands. To do
this, they require that decisions be made by the people who are closest to the
information and who are directly involved in the product or service delivered.3
The objective is to develop jobs and basic work units that are adaptable enough
to thrive in a world of high-velocity change.
In this chapter, we will discuss how jobs can be designed so as to best contribute to the objectives of the organization and at the same time satisfy the needs
of the employees who are to perform them. Clearly, the duties and responsibilities present in jobs greatly in uence employee productivity, job satisfaction, and
employment retention.4 Therefore, the value of job analysis, which de nes clearly
and precisely the requirements of each job, will be stressed. Importantly, we will
emphasize that these job requirements provide the foundation for making objective and legally defensible decisions in managing HR.
Re la t io n s h ip o f J o b Re q u ir e m e n t s
a n d H RM Fu n c t io n s
Learning Outcome 1
A job consists of a group of related activities and duties. Ideally, the duties of a job
should consist of natural units of work that are similar and related. They should
be clear and distinct from those of other jobs to minimize misunderstanding
and con ict among employees and to enable employees to recognize what is
expected of them. For some jobs, several employees may be required, each of
whom will occupy a separate position. A p osition consists of different duties and
responsibilities performed by only one employee. In a city library, for example,
four employees (four positions) may be involved in reference work, but all of them
have only one job (reference librarian). Where different jobs have similar duties
and responsibilities, they may be grouped into a job fam ily for the purposes of
recruitment, training, compensation, or advancement opportunities. For example,
The Canadian Gaming Centre of Excellence, an organization specializing in
gaming education for the Canadian gaming and casino industry, divided the
customer-facing positions within the casino into several job families—table
games, slots/ electronic gaming/ bingo, customer service, security/ surveillance,
house and grounds, food and beverage, uniforms, and retail. These job families
can be broken down into approximately 56 different job titles, each with a
different job description.5
The information collected for jobs is useful for almost all HRM functions,
including strategic HR planning, recruitment, selection, training and development, performance appraisals, compensation management, and legal compliance. This is why job analysis is usually referred to as the “bedrock” for HRM.
job
Agroup of related activities and duties
Explain job analysis and how it helps an
organization’s HRM functions.
position
The different duties and responsibilities
performed by only one employee
job family
Agroup of individual jobs with similar
characteristics
St r a t e g ic H RP
Information on jobs is used to examine a company’s organizational structure
and strategically position it for the future. Does the rm have the right numbers
and types of jobs needed to cover the scope of its activities? What jobs need to
be created? What skills do they require? Are those skills different from the skills
required by the company’s current jobs?
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Re c r u it m e n t
job speci cation
Astatement of the needed knowledge,
skills, and abilities of the person who is to
perform the job
job description
Astatement of the tasks, duties, and
responsibilities of a job to be performed
Before they can nd capable employees for an organization, recruiters need to
know the job speci cations for the positions they are to ll. A job sp eci cation
is a statement of the knowledge, skills, and abilities required of the person performing the job. See Highlights in HRM 4.1 for examples of job speci cations.
Because job speci cations establish the quali cations required of applicants
for a job opening, they serve an essential role in the recruiting function. These
quali cations are typically contained in the notices of job openings. Whether
posted on organizational bulletin boards or human resource information system
(HRIS) Internet sites or included in help wanted advertisements or employment
agency listings, job speci cations provide a basis for attracting quali ed applicants and discouraging unquali ed ones.
As an example of a recruitment process, one of the world’s largest recruitment consultancies with of ces in Canada, Michael Page, typically has one of
its recruitment consultants speak to a company representative to discuss the
job speci cations and clarify the job requirements. The recruitment agency also
provides a market update to the client to help them understand the market conditions and availability of candidates. Michael Page offers a custom-made solution
so that their clients can reach top candidates. The Michael Page recruiter will discuss the sourcing methodologies with the client, whether it be collecting from an
international database, international sourcing, offering a targeted search, using
their network and referrals, or online advertising and social media.6
Se le c t io n
In addition to job speci cations, managers and supervisors use job d escr ip tion s
to select employees and orient them to jobs. A job descr iption is a statement of
the tasks, duties, and responsibilities of a job. (See “Job Descriptions ” later in
this chapter.) According to the HR Council for the Nonpro t Sector in Canada,
all job descriptions must be reviewed annually or whenever there are substantial
changes in the organization’s direction to guarantee that they are congruent with
the strategic direction and structure of the organization. When job descriptions
are amended, compensation rates must be subsequently reviewed. If the workplace is unionized, job descriptions might need to be discussed and reviewed
with the union.7
In the past, job speci cations used as a basis for selection sometimes bore
little relation to the duties to be performed under the job description. Examples
of such non-job-related speci cations abounded. For example, applicants for the
job of labourer were required to have a high school diploma. These kinds of
job speci cations discriminated against members of designated groups, many of
whom were excluded from these jobs.
Tr a in in g a n d D e v e lo p m e n t
Any discrepancies between the knowledge, skills, abilities, and other factors
(often referred to as KSAOs) demonstrated by a jobholder and the requirements contained in the description and speci cation for that job provide clues to
training needs.
The Conference Board of Canada reported that, on average, organizations’
investments in employee learning increased from $800 to $889 per employee
between 2015 and 2017. The average amount of hours invested in learning and
development increased from 25 to 32 hours per employee in that timeframe.
Canada’s major banks invest signi cantly more in training than the norm, at
about $1,187 per employee. The need for training is increasing, and there are
multiple government funding programs that organizations can use for their diversity and training initiatives. As an example of a current training need, AI skills
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are exceedingly crucial for the future workforce, and this issue was brought to
a head during the global pandemic. The federal government has suggested that
workers need to adapt to and capitalize on AI for the Canadian economy to
remain competitive.8
P e r fo r m a n c e A p p r a is a l
The requirements contained in the description of a job provide the criteria for
evaluating the performance of the holder of that job. The results of performance
appraisal may reveal, however, that certain requirements established for a job are
not completely valid.
Individuals may also critize the performance appraisals in place within their
organization, claiming that it is neither effective nor a clear indicator of their
performance. For example, teacher performance appraisal legislation was rolled
out in 2010 by the Ontario Ministry of Education. Its intended purpose was for
professional and student development. Among the technical guidelines, school
managers were required to implement a classroom-based observation measurement to evaluate the teacher. However, teachers complained that there were no
parent evaluations nor teacher self-assessments. As many as 82 percent of the
teachers felt this appraisal process negatively affected their workplace relations
with school managers and both the teachers and school managers felt as though
this program did not improve teacher professionalism.9
C o m p e n s a t io n M a n a g e m e n t
In determining the rate to be paid for performing a job, the relative worth of the
job is one of the most important factors. This worth is based on what the job
demands of an employee in terms of skill, effort, and responsibility, as well as
the conditions and hazards under which the work is performed. The systems of
job evaluation by which this worth may be measured are discussed in Chapter 9.
As The Business Case outlines, job analysis has nancial implications and could
cause workplace problems if handled poorly.
L e g a l C o m p lia n c e
A systematic collection of job data ensures that a job’s duties match its job description. If the criteria used to hire and evaluate employees are vague and not job related,
employers are more likely to nd themselves being accused of discrimination.
A few years ago, the Human Rights Tribunal of Ontario added citizenship-based
recruitment criteria as a form of discrimination. Muhammad Haseeb was an international engineering student at McGill University when he applied for a job at Imperial
Oil Limited. Imperial had a policy that all entry-level engineering candidates had
to be eligible to work in Canada permanently. When Haseeb applied to a position
at Imperial, he was in Canada on a student visa, though he did not make Imperial
aware of his residency status. Haseeb did anticipate that he would be able to get
a work permit for three years after graduation. However, when Imperial extended
Haseeb an offer of employment, they made the request conditional on him providing
proof of his ability to work in Canada permanently. Imperial rescinded the offer
when Haseeb admitted his residency status. Haseeb brought a human rights complaint against Imperial, saying that he was discriminated against on citizenship. The
Tribunal stated that Imperial’s hiring policy was discriminatory, and Imperial had to
pay Haseeb $120,360.70 for lost income, damages, and pre-judgment interest.10
Check In
Think about the HR functions that are affected by the job analysis process. Is there any that is not
affected? If so, what are they?
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Learning Outcome 2
Explain how the information for a job analysis is typically collected and incorporated
into various sections of a job’s description.
J o b A n a ly s is
Organizations exist because people can accomplish more together than they can on
their own. However, the actions of an organization need to be coordinated, and each
person within it needs to do those things they do best. This coordination is typically
achieved by creating individual jobs. A job can be de ned as an activity people do for
which they get paid, particularly as part of the trade or occupation they occupy. But
how exactly should the work be divided, and which people should do which tasks
or jobs? These are questions that businesspeople such as Henry Ford and scienti c
management researchers such as Frederick Winslow Taylor sought to answer at least
a century ago, and the questions managers still ask today.
A work ow a n a lysis helps a rm determine the best processes, types, and mix
of jobs, and how they should ideally be organized to execute the rm’s mission.
In 2018, Engineers Canada, the national organization that regulates engineering
practice in Canada, undertook a work ow analysis. The purpose of the work ow
analysis was to offer a comprehensive understanding of how accreditation
stakeholders’ work ows interact. This work ow analysis was also implemented
to help in the transition to a new data management system.11 As another example,
The Business Case
Th e B e n e fit s o f J o b A n a ly s is a n d D e s ig n
Purolator has been delivering parcels across Canada (and globally) for over 50 years. About 15 years ago, it decided to grapple
with the skyrocketing costs incurred through workers’ compensation claims. In 2005, with 2,130 claims led, the workers’
compensation premiums for the company were $13 million. The
rm was able to trace 90 percent of the claims to 2 occupations:
couriers and sorters. These jobs required workers to haul, lift,
push, and pull on a daily basis; thus, it is not dif cult to understand why injuries are common. As part of its strategy to deal
with this issue, Purolator implemented a proactive-approach
return-to-work program that encouraged workers to return earlier to their jobs. To do so, the company conducted a job analysis
of the 25 jobs in the operations area where most of the injuries
occurred. They were able to identify the physical demands of
the jobs; this helped coordinators identify suitable jobs for those
returning to work and helped convince union representatives
and doctors that workers were not at further risk if they returned
earlier to the jobs. This helped saved Purolator signi cant costs
in terms of days lost to injuries.
A more recent example that illustrates the bene ts of
job analysis and job design has been outlined in a report by
Deloitte. The report described a technology company with
around 6,000 employees in 29 countries that aims to double
its size within 3 to 5 years through acquisitions and natural
growth. The technology company wanted to create a global
job architecture and compensation structure. When acquisitions occurred, job titles and compensation structures could
be consistent rather than incorporating 1,000 different job
titles with different compensation approaches. The other
purpose of the job architecture reconstruction was to change
the fact that there were no clearly de ned career paths, which
hindered employees from accepting international assignments. Deloitte assisted in the job architecture endeavour.
They worked with the company’s HR team to construct the job
functions and families, pinpoint where jobs could be consolidated, planned carer paths, and established a job hierarchy.
The clearly de ned career paths and a consistent strategy for
classifying jobs allowed for employee mobility and an equitable and consistent approach to determining compensation.
Further, once the process was completed, the company also
discovered and handled inequities in pay administration and
incentive plan design.
Sources: Uyen Vu, “How Purolator Dealt with Skyrocketing Costs,” Canadian HRReporter 19, no. 5 (March 13, 2006): 9–10; http://www.morneaushepell.com
/ca-en/insights/new-brunswick-association-nursing-homes-focuses-prevention-and-reduces-workers%E2%80%99; New Brunswick Association of Nursing
Homes, http://www.nbanh.com/en/, accessed February 2015; Deloitte, “Job Archiecture,” (2015), https://www2.deloitte.com/content/dam/Deloitte/us
/Documents/human-capital/us-cons-job-architecture-041315.pdf, retrieved June 1, 2021.
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both Apple and Lenovo make computers. However, Apple focuses on producing
innovative products, whereas Lenovo has traditionally focused on producing lowpriced products. As a result, how the companies are organized, their work ows,
and numbers and types of jobs differ in signi cant ways.
What will work ows and jobs look like in the near future? The biggest game
changer is likely to be automation. Virtually all companies must compete on
price, at least to some extent. And in the long run, automating repetitive tasks is
cheaper than hiring people to do them. Amazon.com has developed a grocery
store that allows people to walk in, load up their groceries, automatically pay for
them, and leave without going through a checkout stand.
And it’s not just service jobs that are being replaced. According to a 2016
report, 42 percent of the Canadian workforce is at high risk of being replaced by
technology and computers in the next 2 decades.12 In the oil and gas industry,
thousands of workers who drilled and monitored wells have been replaced by
robots and electronic equipment and sensors. In the manufacturing sector, robots
are making cars. And the list goes on. However, in more positive news, according
to a 2020 Statistics Canada report, thus far, rms that have invested in robots in
Canada between 1997 to 2017 have employed more rather than fewer workers as
robots allow rms to experience an increase in productivity.13
Think about an organization you worked for or a job or position you have
held. Did you ever think about ways to make the organization’s work ow better?
If so, you were doing an informal work analysis. Likewise, did you analyze the
tasks you were doing and conclude they should be done by someone else or vice
versa? If so, you were doing an informal analysis of your job.
Job analysis is sometimes called “the cornerstone of HRM” because the
information it collects serves so many HRM functions. Job an alysis is the
process of obtaining information about jobs by determining the duties, tasks,
or activities of those jobs.14 The procedure involves systematically investigating
jobs by following a number of predetermined steps speci ed in advance of the
study (see Figure 4.1).15 When completed, job analysis results in a written report
summarizing the information obtained from the analysis of 20 or 30 individual
job tasks or activities. HR managers use these data to develop job descriptions
and job speci cations. These documents, in turn, are used to perform and
enhance the different HR functions, such as the development of performance
appraisal criteria or the content of training classes. The ultimate purpose of job
job analysis
The process of obtaining information about
jobs by determining the duties, tasks, or
activities of jobs
F ig u r e 4 .1
Jo b Analysis: the Co rne rsto ne o f H RM Func tio ns
Alignment Of:
Job Description (TDRs)
Job Speci cation (KSAOs)
HR strategy and planning
nature of structure and work to achieve business results and goals
supply and demand of labour, number and
kinds of people needed to ll open positions
Work ow analysis and job
design
sequencing or grouping of related jobs, and the
nature of interdependence
enriching or expanding jobs to develop and
motivate employees further
Recruitment and selection
posting advertisements, etc., of jobs to ll and
the nature of responsibilities
hiring criteria for evaluating candidates who
apply for open positions
Performance appraisal
process
setting goals, duties, and activities that de ne
the desired performance
attributes and demonstrated qualities used to
assess performance and give feedback
Compensation and bene ts
job evaluation of the job in terms of responsibilities and working conditions
job evaluation of the skills, effort required, etc.
that are rewarded
Legal compliance
equal employment requirements
fair treatment and valid employment practices
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analysis is to improve organizational performance and productivity. Figure 4.2
illustrates how job analysis is performed, including the functions for which it is
used. In contrast to job design, which re ects subjective opinions about the ideal
requirements of a job, job analysis is concerned with objective and veri able
information about the actual requirements of a job.
G a t h e r in g J o b In fo r m a t io n
Job data may be obtained in several ways. The more common methods of analyzing jobs are through interviews, questionnaires, observation, and diaries.
●
●
●
●
In ter views. The job analyst may question individual employees and managers
about the job under review.
Qu estion n a ires. The job analyst may circulate carefully prepared questionnaires to be lled out individually by jobholders and managers. These forms
will be used to obtain data in the areas of job duties and tasks performed,
purpose of the job, physical setting, requirements for performing the job
(skill, education, experience, physical and mental demands), equipment and
materials used, and special health and safety concerns.
Obser va tion . The job analyst may learn about the jobs by observing and
recording on a standardized form the activities of jobholders. Video recording
jobs for later study is an approach used by some organizations.
Dia r ies. Jobholders themselves may be asked to keep a diary of their work
activities during an entire work cycle. Diaries are normally lled out at speci c times of the work shift (such as every half-hour or hour) and maintained
for a two- to four-week period.
F ig u r e 4 .2
The Pro c e ss o f Jo b Analysis
SOURCES OF DATA
JOB DESCRIPTION
Job analyst
Employee
Supervisor
Tasks
Duties
Responsibilities
JOB DATA
METHODS OF
COLLECTING DATA
Interviews
Questionnaires
Observations
Diaries
140
Tasks
Performance
standards
Responsibilities
Knowledge required
Skills required
Experience needed
Job context
Duties
Equipment used
HUMAN RESOURCES
FUNCTIONS
Recruitment
Selection
Training and development
Performance appraisal
Compensation management
JOB SPECIFICATION
Skill requirements
Physical demands
Knowledge requirements
Abilities needed
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Ethics in HRM
Jo b In atio n
Many organizations update their job descriptions at regular intervals. This is because, among other reasons, jobs change; others
may become obsolete, and some may be new. During this process, a job analysis will most likely be done and employees may
be asked, through interviews or surveys, for instance, to describe
their job, including the tasks they perform and their responsibilities. They may sense that this is an opportunity to in ate their
job so as to make it appear more important. They may perceive
that by in ating their job, they will become entitled to better
compensation and bene ts. Or it may just satisfy their egos. Even
managers and supervisors may be tempted to in ate the jobs
of their subordinates. This would make their own roles appear
to be more complex, thus providing the possibility of increased
pay and promotions. Some rms give fancy titles tore ect these
outcomes—a senior teller at a bank becomes a senior customer
service coordinator or a supervisor at a call centre becomes a
second vice president. Night clerks in hotels become auditors,
receptionists become administrators, paper boys become media
distribution of cers, janitors become sanitation consultants, and
cleaning crews become surface technicians. This in ation of title
stretches across all types of industries; for example, Southwest
Airlines has a chief Twitter of cer, Marriott Hotels and Coca-Cola
have chief blogging of cers, and Kodak has a chief listening
of cer. Although some of these new titles offer a eeting boost to
the egos of the jobholders and some re ect the emerging importance of technology-related jobs, there are questions as to the
ethics of the process, especially when the hope of increased pay
may be tied to the outcomes for some of the jobs cited above.
Sources: Schumpeter, “Too Many Chiefs: In ation in Job Titles Is Approaching Weimar Levels,” The Economist (June 24, 2010), http://www.economist
.com/node/16423358; Graham Snowdon, “The Rise of the Meaningless Job Title,” The Guardian (March 20, 2014), http://www.theguardian.com/money
/work-blog/2012/mar/02/rise-of-meaningless-job-title.
N OC and Jo b Analysis
Commonly referred to as the NOC, the National Occupational Classi cation is
compiled by the federal government. The purpose of the NOC is to compile, analyze, and communicate information about occupations. This information can be
used for employment equity, HR planning, and occupational supply-and-demand
forecasts and analyses.
Th e NOC is a comp osite of the Canadian labour market and has help ed
bring about a greater degree of uniformity in the job titles and descrip tions used
by emp loyers in different p arts of the country. Th is uniformity has facilitated
the movement of workers from regions that may be exp eriencing widesp read
unemp loyment to areas where emp loyment op p ortunities are greater. Also, the
NOC code numbers facilitate the exchange of statistical information about jobs
and are useful in rep orting research in the HR area, in vocational counselling,
and in charting career p aths through job transfers and/ or advancements. 18
A p p r o a c h e s t o J o b A n a ly s is
position analysis questionnaire
(PAQ)
Aquestionnaire covering 194 different
tasks that, by means of a ve-point scale,
seeks to determine the degree to which
different tasks are involved in performing a
particular job
142
The systematic and quantitative de nition of job content that job analysis provides is the foundation of many HRM practices. Speci cally, the job analysis
serves to justify job descriptions and other HRM selection procedures. Several
different job analysis approaches are used to gather data, each with speci c
advantages and disadvantages.19 Five of the more popular methods are the position analysis questionnaire, critical incident method, task inventory analysis, the
functional job analysis, and competency-based analysis.
The Po sitio n Analysis Que stio nnaire Syste m
The p osition an alysis qu estion n air e (PAQ) is a quanti able data collection
method covering 195 different worker-oriented tasks. Using a ve-point scale, the
PAQ seeks to determine the degree, if any, to which the different tasks, or job
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elements, are involved in performing a particular job. To execute a job analysis
using the PAQ, background information must be analyzed, followed by observations about the job and interviews with the job holders to assess job content. The
individual or team completing the PAQ then rate how much each item on a standard list of PAQ job elements is relevant to that job. The PAQ items are organized
into six areas: Information Input, Mental Processes, Work Output, Relationships
with Other Persons, Job Context, and Other Job Characteristics. The rating scales
for the extent to which the six areas apply to the job in question involve Extent
of Use, Importance to This Job, Amount of Time, Possibility of Occurrence,
Applicability, and Item-Speci c scales. The individual or team partaking in the
analysis must understand that the job holders will likely not use the same conceptual structure as the PAQ when describing their job. Therefore, it is integral
that the analyst can coordinate the information collected from the job analysis in
such a way that is both aligned with the PAQ and coherent to the job holders.20
A samp le p age from the PAQ covering 10 elements of the Information Inp ut
Division is shown in Figure 4.3. The p erson conducting an analysis with this
questionnaire would rate each of the elements using the ve-p oint scale shown
in the up p er right-hand corner of the samp le p age. The results obtained with the
PAQ are quantitative and can be subjected to statistical analysis. The PAQ also
p ermits dimensions of behaviour to be comp ared across a number of jobs and
p ermits jobs to be group ed on the basis of common characteristics.
The Critic al Inc id e nt M e tho d
The objective of the cr itical in cid en t m eth od is to identify critical job tasks.
Critical job tasks are those important duties and job responsibilities performed by
the jobholder that lead to job success. Information about critical job tasks can be
collected through interviews with employees or managers or through self-report
statements written by employees.
Suppose, for example, that the job analyst is studying the job of reference
librarian. The interviewer will ask the employee to describe the job on the basis of
what is done, how the job is performed, and what tools and equipment are used.
After the job data are collected, the analyst then writes separate task statements
that represent important job activities. Typically, the job analyst writes 5 to 10 important task statements for each job under study. The nal product comprises written task
statements that are clear, complete, and easily understood by those unfamiliar with
the job. The critical incident method is an important job analysis method because it
teaches the analyst to focus on employee behaviours critical to job success.
critical incident method
Ajob analysis method by which important
job tasks are identi ed for job success
task inventory analysis
An organization-speci c list of tasks and
their descriptions used as a basis to identify
components of jobs
functional job analysis (FJA)
Ajob analysis approach that uses an inventory of the various types of work activities
that can constitute any job
Task Inve nto ry Analysis
The task in ven tor y an alysis method can be considered a job-oriented type of
job analysis. Unlike the PAQ, which uses a standardized form to analyze jobs in
different organizations, a task inventory questionnaire can be tailor-made to a
speci c organization.
The technique is developed by identifying—with the help of employees and
managers—a list of tasks and their descriptions that are components of different
jobs. The goal is to produce a comprehensive list of task statements that are
applicable to all jobs. Task statements are then listed on a task inventory survey
form to be completed by the person analyzing the job under review. A task statement might be, “Inventories current supplies to maintain stock levels.” The job
analysis would also note the importance and frequency of use of the task to the
successful completion of the job.
Func tio nal Jo b Analysis
The fu n ction al job an alysis (FJA) approach uses an inventory of the various
types of work activities that can constitute any job. Basic activities called worker
fu n ction s are used to describe what workers do regarding “information, people,
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F ig u r e 4 .3
A Sam p le Pag e fro m the PAQ
INFORMATION INPUT
1 INFORMATION INPUT
1.1 Sources of Job Information
Extent of Use (U)
NA Does not apply
1 Nominal/very
infequent
2 Occasional
3 Moderate
4 Considerable
5 Very substantial
Rate each of the following items in terms of the extent to which it is used by the worker as a source of information in
performing his job.
1.1.1
Visual Sources of Job Information
01 U
Written materials (books, reports, office notes, articles, job instructions, signs, etc.)
02 U
Quantitative materials (materials which deal with quantities or amounts, such as graphs, accounts, specifications,
tables of numbers, etc.)
03 U
Pictorial materials (pictures or picturelike materials used as sources of information, for example, drawings, blueprints,
diagrams, maps, tracings, photographic films, x-ray films, TV pictures, etc.)
04 U
Patterns/related devices (templates, stencils, patterns, etc., used as sources of information when observed during use;
do not include here materials described in item 3 above)
05 U
Visual displays (dials, gauges, signal lights, radarscopes, speedometers, clocks, etc.)
06 U
Measuring devices (rulers, calipers, tire pressure gauges, scales, thickness gauges, pipettes, thermometers,
protractors, etc., used to obtain visual information about physical measurements; do not include here devices
described in item 5 above)
07 U
Mechanical devices (tools, equipment, machinery, and other mechanical devices which are sources of information
when observed during use or operation)
08 U
Materials in process (parts, materials, objects, etc., which are sources of information when being modified,
worked on, or otherwise processed, such as bread dough being mixed, workpiece being turned in a lathe,
fabric being cut, shoe being resoled, etc.)
09 U
Materials not in process (parts, materials, objects, etc., not in the process of being changed or modified, which are
sources of information when being inspected, handled, packaged, distributed, or selected, etc., such as items or
materials in inventory, storage, or distribution channels, items being inspected, etc.)
10 U
Features of nature (landscapes, fields, geological samples, vegetation, cloud formations, and other features of
nature which are observed or inspected to provide information)
11 U
Man-made features of environment (structures, buildings, dams, highways, bridges, docks, railroads, and other
“man-made” or altered aspects of the indoor or outdoor environment which are observed or inspected to provide job
information; do not consider equipment, machines, etc., that an individual uses in his work, as covered by item 7)
and things” as part of this system. For example, when it comes to people, the
basic functions of a job might include coordinating and supervising them. Each
job function is assigned a percentage in terms of its importance to the job. For
example, supervising might be 75 percent of the job.
14
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Hinterhaus Productions/ DigitalVision/ Getty Images
Atask inventory analysis uses
employee input to develop lists of
job tasks and descriptions common
to all jobs.
Co m p e te nc y- B ase d Analysis
The traditional approach to job analysis assumes a static job environment in which
jobs remain relatively stable apart from incumbents who might hold these jobs. Here,
jobs can be meaningfully de ned in terms of tasks, duties, processes, and skills necessary for job success. This assumption, unfortunately, discounts technological advances,
which are often so accelerated that jobs as they are de ned today may be obsolete
tomorrow. Furthermore, the need to respond to global change can alter the nature
of jobs and the requirement of individuals needed to perform them successfully.
Therefore, in a dynamic environment where job demands rapidly change, obsolete
job analysis information simply hinders an organization’s ability to adapt to change.
When organizations operate in a fast-moving environment, managers may
adopt a competency-based approach to job analysis.21 This job analysis method
relies on building job pro les that look at the responsibilities and activities of
jobs and the worker competencies necessary to accomplish them. The objective
is to identify “key” competencies for organizational success. Competencies can be
identi ed through focus groups, surveys, or interviews and might include such
things as interpersonal communication skills, decision-making ability, con ict
resolution skills, adaptability, or self-motivation.
H RIS and Jo b Analysis
HRISs have greatly facilitated the job analysis p rocess. Available today are various software p rograms designed sp eci cally to analyze jobs and to write job
descrip tions and job sp eci cations based on those analyses. Th ese p rograms
normally contain generalized task statements that can ap p ly to many different
jobs. Managers and emp loyees select those statements that best describe the
job under review, indicating the imp ortance of the task to the total job where
ap p rop riate. Advanced comp uter ap p lications of job analysis combine job analysis with job evaluation (see Chap ter 9) and the p ricing of organizational jobs.
J o b D e s c r ip t io n s
As previously noted, a job descr iption is a written description of a job and the
types of duties it includes. Because there is no standard format for job descriptions, they tend to vary in appearance and content from one organization to
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another. However, most job descriptions will contain at least three parts: a job
title, a job identi cation section, and a job duties section. If the job speci cations
are not prepared as a separate document, they are usually stated in the concluding
section of the job description. Highlights in HRM 4.1 shows a job description for
a talent acquisition assistant. This sample job description includes both job duties
and job speci cations and should satisfy most of the job information needs of
managers who must recruit, interview, and orient a new employee.22
Highlights in HRM 4.1
Jo b De sc rip tio n fo r a Tale nt Ac q uisitio n Assistant
Job Identi cation
JOB TITLE: Talent Acquisition Assistant
Division:
Western Canada
Department:
Human Resources Management
Job Analyst:
Virginia Sasaki
Date Analyzed:
12/3/20
Report to:
HRManager Job Code: 14–17
Date Veri ed:
12/17/20
Brief Listing of Major Duties
Job Statement
Performs professional human resources work in the areas
of employee recruitment and selection, testing, orientation,
transfers, and maintenance of employee human resources
les. May handle special assignments and projects in employment equity, employee grievances, training, or classi cation and compensation. Works under general supervision.
Incumbent exercises initiative and independent judgment in
the performance of assigned tasks.
Essential Functions and Responsibilities
Essential Functions
1. Prepares recruitment literature and job advertisements
for applicant placement.
2. Schedules and conducts personal interviews to determine applicant suitability for employment. Includes
reviewing mailed applications and résumés for quali ed
personnel.
3. Supervises administration of testing program. Responsible
for developing or improving testing instruments and
procedures.
146
4. Presents orientation program to all new employees.
Reviews and develops all materials and procedures for
orientation program.
5. Coordinates division job posting and transfer program.
Establishes job-posting procedures. Responsible for
reviewing transfer applications, arranging transfer interviews, and determining effective transfer dates.
6. Maintains a daily working relationship with division managers on human resources matters, including recruitment
concerns, retention or release of probationary employees,
and discipline or discharge of permanent employees.
7. Distributes new or revised human resources policies and
procedures to all employees and managers through bulletins, meetings, memorandums, and/or personal contact.
8. Performs related duties as assigned by the human
resources manager.
Job Speci cations and Requirements
Job Speci cations
1. Four-year college or university degree with major
course work in human resources management,
business administration, or industrial psychology OR
a combination of experience, education, and training
equivalent to a four-year degree in human resources
management.
2. Considerable knowledge of principles of employee
selection and assignment of personnel.
3. Ability to express ideas clearly in both written and oral
communications.
4. Ability to independently plan and organize one’s own
activities.
5. Knowledge of human resources computer applications
desirable.
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Job descriptions are of value to both the employees and the employer. From
the employees’ standpoint, job descriptions can be used to help them learn their
job duties and to remind them of the results they are expected to achieve. From the
employer’s standpoint, written job descriptions can serve as a basis for minimizing
the misunderstandings that occur between managers and their subordinates concerning job requirements. They also establish management’s right to take corrective
action when the duties covered by the job description are not performed as required.
The purpose of the job description is detailed in a collective agreement for
MoveUP, a union for public and private sector companies in British Columbia and
Western Canada. The collective agreement states, “job descriptions are written
with the intent to set forth the general duties and requirements of the job and
to indicate the level of skill required and shall not be construed as imposing any
restriction on the right of the Employer to create a new job or to assign duties to
employees other than those speci cally mentioned in job descriptions, providing
always that if the assignment of such duties changes the job content suf ciently to
justify a review of the job evaluation results, the local Union shall be noti ed.”23
Jo b Title
Selection of a job title is important for several reasons. First, the job title is of psychological importance, providing status to the employee. For instance, “sanitation
engineer” is a more appealing title than “garbage collector.” Second, if possible,
the title should provide some indication of what the duties of the job entail.
Titles such as mea t in spector, electr on ics a ssembler, sa lesper son , and en gin eer
obviously hint at the nature of the duties of these jobs. The job title also should
indicate the relative level occupied by its holder in the organizational hierarchy.
For example, the title ju n ior en gin eer implies that this job occupies a lower level
than that of sen ior en gin eer. In 2017, the Toronto District School Board eliminated the term “chief” from its job titles, claiming to do so out of consideration
for Indigenous communities. The word was replaced with the term “manager.”24
Jo b Id e nti c atio n Se c tio n
The job identi cation section of a job description usually follows the job title. It
includes items such as the departmental location of the job, the person to whom the
jobholder reports, and the date the job description was last revised. For example, in a
job description for a Coordinator, Proceedings and Veri cation posted by the House
of Commons, under the job identi cation is listed the job title, the linguistic pro le,
group and level, supervisor title, directorate, service area, and effective date.25
Jo b Dutie s, o r Esse ntial Func tio ns, Se c tio n
Statements covering job duties are typ ically arranged in order of imp ortance.
These statements should indicate the weight, or value, of each duty. Usually,
but not always, the weight of a duty can be gauged by the p ercentage of time
devoted to it. The statements should stress the resp onsibilities all the duties
entail and the results they are to accomp lish. It is also general p ractice to
indicate the tools and equip ment used by the emp loyee in p erforming the job.
Remember, the job duties section must list only the essential functions of the
job to be p erformed.
Jo b Sp e c i c atio n Se c tio n
As stated earlier, the personal quali cations an individual must possess to perform
the duties and responsibilities contained in a job description are compiled in the
job speci cation. Typically, this section covers two areas: (1) the skill required to
perform the job and (2) the physical demands the job places on the employee
performing it.
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Skills relevant to a job include education or exp erience, sp ecialized training,
p ersonal traits or abilities, and manual dexterities. The physica l dema n ds of a
job refer to how much walking, standing, reaching, lifting, or talking must be
done on the job. The condition of the p hysical work environment and the hazards emp loyees may encounter are also among the p hysical demands of a job.
Job speci cations should also include interpersonal skills or key competencies
necessary for job success. For example, behavioural competencies might include
the ability to make decisions on imperfect information, decisiveness, the ability to
handle multiple tasks, and con ict resolution skills. Behavioural competencies can
be assessed by asking applicants situational interview questions (see Chapter 6).
For example, a manager could ask an applicant about a time when the applicant
had to make a critical decision quickly.
P r o b le m s w it h J o b D e s c r ip t io n s
Managers consider job descriptions a valuable tool for performing HRM functions.
Nevertheless, several problems are frequently associated with these documents,
including the following:
1. If they are poorly written, using vague rather than speci c terms, they
provide little guidance to the jobholder.
2. They are sometimes not updated as job duties or speci cations change.
3. They may violate the law by containing speci cations not related to job success.
4. They can limit the scope of activities of the jobholder, reducing
organizational exibility.
Job descriptions may also often be an overlooked tool to manage employees.
According to a Canadian study, 60 percent of HR professionals said they write job
descriptions for hiring for a position, and 28 percent said they write job descriptions for compliance purposes. Only 22 percent explained that they might use
the job description for other purposes, including clarifying expectations, competency mapping, or reviewing and updating existing roles. Further, 37 percent of
respondents said they do not even have job descriptions for every position within
their organization, and 43 percent of respondents said they do not update job
descriptions. Therefore, job descriptions may not be used to their full potential.26
W riting Cle ar and Sp e c i c Jo b De sc rip tio ns
When writing a job description, it is essential to use statements that are terse,
direct, and simply worded. Often a manager may nd it dif cult to determine
from a résumé or interview whether candidates possess the necessary credentials
and previous experience essential to excel for the job in question. To assist them
in attracting suitable candidates, some employers deviate from the standard job
description to focus on a competency-based job description. Competen cies is
de ned as the knowledge, skills, abilities, personal characteristics, and other
work-related factors that would make an individual a better performer in the
speci ed position.27 A competency-based job description stresses the skills and
experiences the potential jobholder will require or must learn to carry out the
position’s responsibilities adequately.28
A comp etency-based job descrip tion can be created by conducting a job
analysis 29 and outlining the duties and resp onsibilities required for each position.
Following this step , emp loyers should ensure positions are matched with the
comp ulsory organizational resp onsibilities to guarantee that each of the tasks
necessary to run the organization is allocated and to the correct p erson. Once
the essential tasks have been established, the emp loyer should outline the skills,
knowledge, and abilities necessary to p erform each sp eci c task, sp ecifying which
skills are required of new hires and which skills can be learned after an emp loyee
joins the organization.30 Both general and individual comp etencies should be
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listed in the job descrip tion. General and organizational comp etencies include
comp etencies required for everyone within the organization, while sp eci c or
individual comp etencies entail comp etencies necessary for a particular job.31
A competency based-job description is a useful tool to assist employers in
nding an ideal candidate. It also can be used for establishing the different levels
of staf ng within a department and providing employees with the understanding
of the ways in which they can advance.32 Further, the outlined competencies
become factors for assessments to ensure that performance evaluations are
objective. Finally, the competency-based job description helps employers determine the necessary work-related seminars, workshops, and other training so that
employees can successfully perform their jobs.33
Check In
Re ect on the job you currently hold or most recently held (or a job you are familiar with if you have
never worked). Try to answer the questions in Figure 4.3. Then organize the information into the
various job sections of a job description.
Learning Outcome 3
J o b D e s ig n
It is not uncommon for managers and supervisors to confuse the processes of
job analysis and job design. Job analysis is the study of jobs as currently performed by employees. It helps with the job description, which identi es job
duties and the requirements needed to perform the work successfully. Job d esign ,
which is an outgrowth of job analysis, is concerned with structuring jobs to improve
organization ef ciency and employee job satisfaction. Job design is concerned
with changing, modifying, and enriching jobs to capture the talents of employees
while improving organizational performance.34 Job design should facilitate the
achievement of organizational objectives. At the same time, the design should recognize the capabilities and needs of those who are to perform the job.
As Figure 4.4 illustrates, job design is a combination of four basic considerations: (1) the organizational objectives the job was created to ful ll; (2) behavioural
concerns that in uence an employee’s job satisfaction; (3) industrial engineering
Provide examples illustrating the various
factors that must be considered in designing
a job, including motivation factors.
job design
An outgrowth of job analysis that improves
jobs through technological and human
considerations to enhance organization efciency and employee job satisfaction
F ig u r e 4 .4
B asis fo r Jo b De sig n
Organizational objectives for the
job, including tasks, duties, and
responsibilities to be performed
Industrial engineering concerns
centring on efficient production
processes and work-method
improvements
THE JOB
Ergonomic considerations
involving human capabilities
and limitations
Behavioural concerns reflected
in the different talents, abilities,
and skills of employees
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considerations, including ways to make the job technologically ef cient; and
(4) ergonomic concerns, including workers’ physical and mental capabilities.35 We
have already brie y discussed the organizational objective considerations of job
design—for example, to improve ef ciency and employee job satisfaction. We will
now look more closely at the other three considerations.
M o t iv a t io n a l C o n s id e r a t io n s
Would you like it if your supervisor timed down to the minute each task associated with your job and then asked you to adhere to those times? Would you nd
this motivating? Probably not. In an effort to counter the motivational problems
that occur when workers do standardized, repetitive tasks, researchers began
proposing theories they believed could improve simultaneously the ef ciency of
organizations and the job satisfaction of employees. Job design methods seek to
incorporate the behavioural needs of employees as they perform their individual
jobs. The two methods discussed below strive to satisfy the intrinsic needs of
employees and motivate them in their work environments. The job enrichment
model and the job characteristics model have long been popular with researchers
and practitioners as ways to increase the job satisfaction of employees.
Jo b Enric hm e nt
job enrichment
Enhancing a job by adding more meaningful
tasks and duties to make the work more
rewarding or satisfying
Any effort that makes work more rewarding or satisfying by adding more meaningful tasks to an employee’s job is called job en r ich m en t. Originally popularized by Frederick Herzberg, job enrichment is touted as ful lling the high
motivational needs of employees, such as self-ful llment and self-esteem, while
achieving long-term job satisfaction and performance goals.36 Job enrichment, or
the vertical expansion of jobs, may be accomplished by increasing the autonomy
and responsibility of employees. Herzberg discusses ve factors for enriching
jobs and thereby motivating employees: achievement, recognition, growth,
responsibility, and performance of the whole job versus only parts of the job. For
example, managers can use these ve factors to enrich the jobs of employees by
●
increasing the level of dif culty and responsibility of the job,
●
allowing employees to retain more authority and control over work outcomes,
●
providing unit or individual job performance reports directly to employees,
●
adding new tasks to the job that require training and growth, and
●
assigning individuals speci c tasks, enabling them to use their particular
competencies or skills.
These factors allow employees to assume a greater role in the decisionmaking process and become more involved in planning, organizing, directing, and
controlling their own work. Vertical job enrichment can also be accomplished by
organizing workers into teams and giving these teams greater authority for selfmanagement. As an example of a successful job enrichment program, Ultimate
Software, a company specializing in HR solutions and HR payroll, offers a yearlong role-rotation program that includes job enrichment, skill development, and
career exploration within their marketing department. Participants who are part
of this program shadow existing employees, foster relationships, and return to
their roles ready for new job openings as they become available.37
Jo b Charac te ristic s
Job design studies explored a new eld when behavioural scientists focused on
identifying various job dimensions that would improve simultaneously the ef ciency of organizations and the job satisfaction of employees. Perhaps the theory
that best exempli es this research is the one advanced by Richard Hackman and
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Greg Oldham.38 Their job ch ar acter istics m od el proposes that three psychological states of a jobholder result in improved work performance, internal motivation, and lower absenteeism and turnover.39 A motivated, satis ed, and productive
employee (1) experiences mea n in gfu ln ess of the work performed, (2) experiences
respon sibility for work outcomes, and (3) has kn owledge of the resu lts of the work
performed. Hackman and Oldham believe that ve core job dimensions produce
the three psychological states. The ve job characteristics are as follows:
1. Skill va r iety: the degree to which a job entails a variety of different
activities, which demand the use of a number of different skills and talents
by the jobholder.
2. Ta sk iden tity: the degree to which the job requires completion of a whole
and identi able piece of work, that is, doing a job from beginning to end
with a visible outcome.
3. Ta sk sign i ca n ce: the degree to which the job has a substantial impact on
the lives or work of other people, whether in the immediate organization
or in the external environment.
4. Au ton omy: the degree to which the job provides substantial freedom,
independence, and discretion to the individual in scheduling the work and
in determining the procedures to be used in carrying it out.
5. Feedba ck: the degree to which carrying out the work activities required by
the job results in the individual being given direct and clear information
about the effectiveness of their performance.
Em p lo ye e Em p o w e rm e nt
job characteristics model
Ajob design theory that purports that three
psychological states (experiencing meaningfulness of the work performed, responsibility
for work outcomes, and knowledge of the
results of the work performed) of a jobholder
result in improved work performance,
internal motivation, and lower absenteeism
and turnover
employee empowerment
Granting employees power to initiate
change, thereby encouraging them to take
charge of what they do
job crafting
A naturally occurring phenomenon
whereby employees mould their tasks to
t their individual strengths, passions, and
motives better
industrial engineering
A field of study concerned with analyzing
work methods and establishing time
standards
Job enrichment and job characteristics are speci c programs by which managers
or supervisors can formally change the jobs of employees. A less structured
method is to allow employees to initiate their own job changes through the
concept of empowerment. Em p loyee em p ower m en t is a technique of involving
employees in their work through the process of inclusion. Empowerment encourages employees to become innovators and managers of their own work and
involves them in their jobs in ways that give them more control and autonomous
decision-making capabilities (see Highlights in HRM 4.2).
Another type of empowerment technique that occurs at the individual level
is job crafting (see more details later in this section). Job cr aftin g is a naturally
occurring phenomenon whereby employees mould their tasks to better t their
individual strengths, passions, and motives.40
In d u s t r ia l En g in e e r in g C o n s id e r a t io n s
The study of work is an important contribution of the scienti c management
movement. In d u str ial en gin eer in g, which evolved with this movement, is
concerned with analyzing work methods and establishing time standards.41
Speci cally, it involves the study of work cycles to determine which, if any, elements can be modi ed, combined, rearranged, or eliminated to reduce the time
needed to complete the cycle. Next, time standards are established by recording
the time required to complete each element in the work cycle, using a stopwatch
or work-sampling technique. By combining the times for each element, observers
can determine the total time required. This time is subsequently adjusted to allow
for the skill and effort demonstrated by the observed worker and for interruptions that may occur in performing the work. The adjusted time becomes the time
standard for that particular work cycle.
As an example of an industrial engineering initiative, Dr. Ian Arra, a medical
of cer of health and CEO of Grey Bruce Health Unit in Owen Sound, Ontario,
created a “hockey hub” vaccine clinic. The “hockey hub” clinic has been used
in many places in Ontario, Manitoba, Alberta, and even received interest from
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Highlights in HRM 4.2
Em p o w e re d Em p lo ye e s Ac hie ve Re sults
In today’s highly competitive and dynamic business environment, employers as diverse as Home Depot and RBChave
turned to their employees to improve organizational performance. Empowered employees have made improvements in
product or service quality, reduced costs, and modi ed or, in
some cases, designed products.
●
●
●
●
●
●
Lowe’s Home Improvement earned $1 million from a novel
way of selling paint. The idea came from an employee, who
shared it with an internal social collaboration system.
Labatt Brewing Company Ltd. ensures that employees stay
connected and are aware of what is happening internally
by conducting monthly and quarterly town-hall-style Stein
Sessions in the pub and an annual National Commercial
Conference.
At Fidelity Canada, the Voice of the Employee program
emboldens employees to offer feedback and awards
them up to $2,000 for their suggestions that are
implemented.
Metrolinx encourages employees to submit their ideas
for a better workplace, improved customer satisfaction,
operating ef ciencies, and cost savings through an intiative
called Ideas@Work.
Blake, Cassels & Graydon LLP created an initiative called the
BrightIdeas@Blakes to motivate employees to bring forth
ideas regarding progressing client services or ef ciency.
CIBC rewards outstanding employee performance through
the Achievers program, which grants employees the ability
to recommend peers for quarterly awards.
●
●
Levi Strauss’s Design Team came up with the waterless
Collection Jeans and saved the company 16 million litres of
water per 1.5 million jeans produced, all while advancing
sustainability.
Apple uses a holistic team-based approach to running its
business. There are no committees at Apple. Teams are used
to distribute the various responsibilities among key executives, and they meet for three hours each week to touch base.
Although de ning empowerment can become the rst step
to achieving it, for empowerment to grow and thrive, organizations must encourage these conditions:
●
●
●
●
Participation. Employees must be encouraged to take
control of their work tasks. Employees, in turn, must care
about improving their work process and interpersonal work
relationships.
Innovation. The environment must be receptive to people
with innovative ideas and encourage people to explore new
paths and to take reasonable risks at reasonable costs. An
empowered environment is created when curiosity is as
highly regarded as is technical expertise.
Access to information. Employees must have access to a
wide range of information. Involved individuals decide what
kind of information they need for performing their jobs.
Accountability. Empowerment does not involve being able
to do whatever you want. Empowered employees should
be held accountable for their behaviour toward others,
producing agreed-on results, achieving credibility, and
operating with a positive approach.
Sources: Mindy S. Lubber, “How Timberland, Levi’s Use Teamwork to Advance Sustainability,” GreenBiz (May 9, 2011), http://www.greenbiz.com
/blog/2011/05/09/how-companies-court-stakeholders-accelerate-sustainability; http://www.osler.com/aboutus/, retrieved February 2015; Mark Milian, “Why
Apple Is More Than Just Steve Jobs,” CNN (August 25, 2011) Diane Jermyn, “Forward-Looking Top GTA Employers Take Workplace Culture to the Next Level,”
The Globe and Mail (December 7, 2018); Christine Crandell, “Real Examples of Social Business ROI,” Forbes (June 22, 2012).
of cials in New Zealand. The model incorporates big spaces such as arenas to
expedite the process so that vaccinators can administer more doses. As a patient
receives a seat in an area, the services come to them. The patient’s paperwork,
their shot, and the 15-minute recovery period would all be done from the comfort
of the patient’s seat. A “hockey hub” arena could administer 70 to 90 shots per
hour, whereas a traditional clinic could likely only accept between 6 to 10 patients
per hour. Michael Carter, a professor in the University of Toronto’s mechanical
and industrial engineering department whose focus is on producing healthcare
ef ciencies, referred to the new system as “brilliant.”42
Industrial engineering constitutes a disciplined and objective approach to job
design. Unfortunately, the concern of industrial engineering for improving ef ciency and simplifying work methods may cause the behavioural considerations
in job design to be neglected. What may be improvements in job design and
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alvarez/ E+/ Getty Images
Many companies willingly
invest in ergonomically
designed workstations because
they protect the health and
productivity of employees.
ef ciency from an engineering standpoint can sometimes prove psychologically
unsound. For example, the assembly line, with its simpli ed and repetitive tasks,
embodies sound principles of industrial engineering, but these tasks are often
not psychologically rewarding for those who must perform them. Thus, to be
effective, job design must also provide for the satisfaction of behavioural needs.
Er g o n o m ic C o n s id e r a t io n s
Consider this statistic. In North America, millions of workplace injuries occur
yearly from motions such as lifting, bending, and typing. These injuries cost
employers through lost productivity, medical bene ts, and lost time payments.
Therefore, ergonomics is an important element of job design.
Ergon om ics is the study of people at work and the practice of matching the
features of products and jobs to human capabilities, preference, and the limitations of those who are to perform a job. Ergonomics focuses on ensuring that
jobs are designed for safe and ef cient work while improving the safety, comfort,
and performance of users. In short, it seeks to t the job to the person rather
than the person to the job.
Equipment design must consider the physical abilities of operators to use the
equipment and to react through vision, hearing, and touch to the way the equipment operates. For example, there is substantial variation in the way individuals
move depending on their physical size, gender, age, and other factors. Designing
equipment controls to be compatible with both the physical characteristics and
the reaction capabilities of the people who must operate them and the environment in which they work is critically important.
ergonomics
An interdisciplinary approach to designing
equipment and systems that can be easily
and ef ciently used by human beings
J o b C r a ft in g a n d J o b C a r v in g
People typically hope to nd a job that perfectly suits their interests and abilities, but
often this is an impossible quest. Hence, a second-best option can be to take the initiative to alter one’s existing position through job crafting. Job cra ftin g can be de ned
as a self-driven pursuit to change aspects of an individual’s own position to improve
the t between the job and their needs, skills, and preferences.43 An individual can
foster meaningfulness in their work by changing or altering components of their
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position from the bottom up instead of managers implementing changes from the
top-down like most job redesign plans.44 Job crafting has been found to produce
increased work engagement, decreased burnout, and increased well-being.45
Employees may alter their job through various avenues. The rst way an individual can engage in job crafting relates to the tasks that encompass the job.46 An
employee may add tasks, redesign tasks, or emphasize different tasks, such as a dentist who spends added time educating patients on healthy dental habits if mentorship is meaningful to them.47 An employee may also engage in job sharing through
relational changes.48 An employee may build relationships, adapt pre-existing relationships to ensure mutual support and encouragement, or reframe relationships,
such as if a school principal, rather than merely monitoring teachers, gets to know
teachers and their accomplishments personally.49 The third form of job crafting is
through changes in cognition.50 An individual may perceptually change aspects
of their job by broadening their beliefs about their impact or the purpose of their
job. For example, zookeepers, whose main responsibility is to clean cages and feed
animals, often view their work as a moral responsibility to adequately care for animals, making the job more motivating. Employees may also change their cognitions
about their job by narrowing their mental scope to focus on valuable aspects or
stray from focusing on aspects of their job they dislike. Finally, an employee may
make mental connections between elements of their job and components of their
identity that is valuable to them. For example, a customer service representative
who enjoys comedy can connect with customers using humour.51
Another way jobs might be amended to make the job more suitable to the
individual is through job ca r vin g. In this case, the job is amended not by the
individual but by the employer or a vocational specialist to provide employment opportunities for individuals with autism and other disabilities. Job carving
entails crafting, adapting, or tailoring a job to support an individual with a disability and concurrently address the needs of an employer.52 Job carving is typically carried out by performing a task analysis of a job and reducing it to a series
of smaller steps. Then, the employer or vocational specialist recognizes what
aspects of the job can be completed by the individual with disabilities. Skills
identi ed from several jobs can be combined into a new job that is personalized
to t the skills, abilities, and level of support needed for an individual. The idea
is to promote independence as much as possible.53
Job carving is no easy feat. It often requires the involvement of specialized
consultants and tactics for workforce development, partnership with individuals,
and ongoing experimentation to determine the best t for employees.54 Yet, if
completed correctly and resources are allocated accurately, job carving can be
highly bene cial to ensuring individuals with differing abilities and disabilities
can be both satis ed and productive when performing their job.55
Check In
What are some of the bene ts of employee empowerment? Can it ever result in negative consequences for the rm? If so, when, and how?
Learning Outcome 4
Describe the different group techniques and
types of work schedules used to broaden a
rm’s job functions and maximize employee
contributions.
154
D e s ig n in g W o r k fo r G r o u p s a n d Te a m s
Although a variety of group techniques have been developed to involve employees
more fully in their organizations, all these techniques have two characteristics in
common: enhancing collaboration and increasing synergy. In increasing the degree
of collaboration in the work environment, these techniques can improve work
processes and organizational decision making. In increasing group synergy, the
techniques underline the adage that the contributions of two or more employees
are greater than the sum of their individual efforts. Furthermore, research has
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shown that working in a group setting strengthens employee commitment to the
organization’s goals,56 increases employee acceptance of decisions, and encourages a cooperative approach to workplace tasks.57 Two collaborative techniques
are discussed here: employee involvement groups and employee teams.
Em p lo y e e In v o lv e m e n t G r o u p s
Groups of 5 to 10 employees doing similar or related work who meet regularly to
identify, analyze, and suggest solutions to shared problems are often referred to
as em p loyee in volvem en t g r ou p s (EIGs). Also known as qu a lity circles (QCs),
EIGs are used to foster communication among individuals within the team,
inform employees of their responsibilities and expectations, form dialogue surrounding ideas for improvement and innovation, develop internal leadership and
a feeling of organizational commitment, and promote skills that can be used in a
workgroup.58 Generally, EIGs recommend their solutions to management, which
decides whether to implement them.
The EIG process, illustrated in Figure 4.5, begins with EIG members brainstorming job-related problems or concerns and gathering data about these issues.
The process continues through the generation of solutions and recommendations, which are then communicated to management. If the solutions are implemented, the results are measured, and the EIG and its members are usually
recognized for the contributions they have made.
Although EIGs have become an imp ortant emp loyee contribution system,
they are not without their p roblems and their critics. First, to achieve the results
desired, those p articip ating in EIGs must receive comp rehensive training in
p roblem identi cation, p roblem analysis, and various decision-making tools, such
as statistical analysis and cause-and-effect diagrams. Comp rehensive training
for EIGs is often cited as the most imp ortant factor leading to their success.
Second, managers should recognize the group when a recommendation is made,
regardless of whether the recommendation is adop ted. This ap p roach encourages the group to continue coming up with ideas even when they are not all
employee involvement
groups (EIGs)
Groups of employees who meet to resolve
problems or offer suggestions for organizational improvement
F ig u r e 4 .5
The Dynam ic s o f Em p lo ye e Invo lve m e nt Gro up s
STEP 1
Group members brainstorm ideas for
organizational improvement. Ideas can
be for product/service improvements,
safety concerns, cost reductions, etc.
STEP 4
Recommendations
are implemented
and group
members are
rewarded for their
contributions.
REASONS FOR
EMPLOYEE INVOLVEMENT GROUPS
Employee knowledge of affected areas
Special skills and abilities of employees
Technical changes
Customer requirements
STEP 2
Group members
prepare
solutions and
recommendations
for improvements.
STEP 3
Managers evaluate group
recommendations and make decisions.
Source: Adapted from materials prepared by The Family and Relationship Center, 7946 IvanhoeAvenue, La Jolla, CA92037.
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imp lemented by management. Third, some organizations have found that EIGs
run out of ideas, and management must feed them ideas to keep the p rocess
going. Finally, and most imp ortantly, managers and sup ervisors must exhibit a
p articip ative/ democratic leadership style in which emp loyees are encouraged to
work collaboratively with management to imp rove organizational p erformance.
Em p lo y e e Te a m s
Perhaps one of the more radical changes to how work is done is the introduction
of organizational teams. At such diverse organizations as FedEx, Hewlett-Packard,
and Lucas lm, producer of the Sta r Wa rs and In dia n a Jon es lms, the bene ts of
employee teams have included more integration of individual skills, better performance in terms of quality and quantity, solutions to unique and complex problems,
reduced delivery time, reduced turnover and absenteeism, and accomplishments
among team members. The study of teams at Google under Project Aristotle is perhaps one of the most extensive initiatives in the corporate world to analyze how
teams work and their effectiveness. About six years ago, Google became focused
on building the perfect team. There was a feeling at Google that the best teams
meant putting together the best people. As they soon learned, this was not the case.
In 2012, they launched Project Aristotle to study hundreds of teams at Google. As
part of this initiative, the People’s Operations Department (the HRM Department)
studied decades of academic research and their own in-house research, but they
were puzzled on what actually worked. Traditional explanations such as personality
of team members, skill levels, backgrounds, and so on, were falling short when
they considered their data. In the end, they started to focus on what psychologists
and sociologists call group norms—traditions, behavioural standards, and unwritten
rules—and here is where they made a “breakthrough.” There were several group
norms that helped to explain the effectiveness of teams at Google, including being
dependable (getting things done on time and meeting expectations), having structure and clarity, the work having meaning for members, and group members’ belief
that their work would have impact. However, the most signi cant norm was what
they called psychologica l sa fety, where members were willing to take risks because
they felt safe, where they could voice their opinions, and ask judgment-free questions. In these instances, managers provided “safe zones” for opinions.59
Luis Alvarez/ DigitalVision/ Getty Images
Teams create synergy through
the integration of their members’
knowledge, skills, and abilities
and the acceptance of individual
diversities.
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F ig u r e 4 .6
Syne rg istic Te am Charac te ristic s
Team synergy is heightened when team members engage in
these positive behaviours.
●
●
●
●
Support. The team exhibits an atmosphere of inclusion. All team members speak up and feel free to
offer constructive comments.
Listening and clari cation. Active listening is practised. Members honestly listen to others and seek
clari cation on discussion points. Team members
summarize discussions held.
Disagreement. Disagreement is seen as natural and is
expected. Member comments are nonjudgmental and
focus on factual issues rather than personality con icts.
●
●
Consensus. Team members reach agreements
through consensus decision making. Consensus decisions require nding a proposal that is acceptable
to all team members, even if not the rst choice of
individual members. Common ground among ideas
is sought.
Acceptance. Team members are valued as individuals, recognizing that each person brings a valuable
mix of skills and abilities to team operations.
Quality. Each team member is committed to excellent performance. There is emphasis on continuous
improvement and attention to detail.
Em p loyee team s are a logical outgrowth of employee involvement and the
philosophy of empowerment. Although many de nitions of tea ms exist, we de ne a
work tea m as a group of individuals working together toward a common purpose, in
which members have complementary skills, members’ work is mutually dependent,
and the group has discretion over tasks performed. Furthermore, teams seek to
make members of the work group share responsibility and accountability for their
group’s performance. Inherent in the concept of employee teams is that employees,
not managers, are in the best position to contribute to workplace performance. With
work teams, managers accept the notion that the group is the logical work unit for
applying resources to resolve organizational problems and concerns.60
Teamwork also embraces the concept of syn er gy. Synergy occurs when the
interaction and outcome of team members are greater than the sum of their individual efforts.61 Unfortunately, synergy may not automatically happen; rather,
it must be nurtured within the team environment.62 Figure 4.6 lists the factors
contributing to a synergistic team setting.
Teams can operate in a variety of structures, each with different strategic
purposes or functional activities. Figure 4.7 describes common team forms. One
form—self-directed teams—is often championed as being the highest form of
team structure. Self-directed teams, also called a u ton omou s work gr ou ps, selfma n a ged tea ms, or high-per for ma n ce tea ms, are groups of employees who are
Employee teams
An employee contributions technique
whereby work functions are structured for
groups rather than for individuals and team
members are given discretion in matters traditionally considered management
prerogatives, such as process improvements, product or service development, and
individual work assignments
F ig u r e 4 .7
Fo rm s o f Em p lo ye e Te am s
●
●
●
Cross-functional team. A group staffed with a mix of
specialists (e.g., marketing, production, engineering)
and formed to accomplish a speci c objective. Crossfunctional teams are based on assigned rather than
voluntary membership.
Project team. A group formed speci cally to design
a new product or service. Members are assigned by
management on the basis of their ability to contribute
to success. The group normally disbands after task
completion.
Self-directed team. A group of highly trained individuals
performing a set of interdependent job tasks within a
natural work unit. Team members use consensus deci-
sion making to perform work duties, solve problems, or
deal with internal or external customers.
●
●
Task force team. A task force formed by management
to immediately resolve a major problem. The group is
responsible for developing a long-term plan for problem
resolution, which may include a charge for implementing
the solution proposed.
Process improvement team. A group made up of experienced people from different departments or functions
and charged with improving quality, decreasing waste,
or enhancing productivity in processes that affect all
departments or functions involved. Team members are
normally appointed by management.
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Virtual teams
Ateam with widely dispersed members
linked together through computer and
telecommunications technology
158
accountable for a “whole” work process or segment that delivers a product or
service to an internal or external customer. For example, in a manufacturing
environment, a team might be responsible for a whole product (e.g., a computer
screen) or a clearly de ned segment of the production process, such as the
building of an engine for a passenger car. Similarly, in a service environment, a
team is usually responsible for entire groupings of products and services, often
serving clients in a designated geographic area. Typical team functions include
setting work schedules, dealing directly with external customers, training team
members, setting performance targets, budgeting, managing inventory, and purchasing equipment or services. To operate ef ciently, team members acquire
multiple skills, enabling them to perform a variety of job tasks.
To compete in today’s national and international markets, managers increasingly
form virtual teams. Vir tu al team s use advanced computer and telecommunications
technology to link team members who are geographically dispersed, often worldwide. Management may form a project team (see Figure 4.7) to develop a new pharmaceutical drug and have the team operate in a virtual environment to achieve its
goal. Recently, Shoppers Drug Mart established a virtual team of professionals who
provide support and counselling for their established medical cannabis patients. As
the current regulations do not allow pharmacists to dispense medical cannabis from
a pharmacy, the virtual team setting is an effective and ef cient alternative.63 Amid
the global COVID-19 pandemic, virtual teams became the norm. Approximately
88 percent of businesses encouraged employees to work from home.64 Facebook
CEO Mark Zuckerberg also proclaimed that 50 percent of its workforce would be
working in a remote team within the next 5 to 10 years. Twitter has also announced
that some employees who want to work from home permanently are permitted
to do so.65 Although virtual teams have many bene ts, they are not without problems.66 A virtual team setting makes it harder to get the teams to bond and foster
open dialogue, more dif cult for informal leaders to surface, and easier to result in
misunderstandings.67 The global average cost to upgrade or enable remote work
technology is, on average, $273 per employee. Further, maintaining a company
culture within a remote team requires a signi cant amount of work and planning.
Virtual happy hours are not enough. As an example of a strategy to assess the climate in a virtual environment, Orange Theory Fitness sent out employee pulse surveys every 90 days to measure engagement and morale in the virtual setting during
the pandemic and the move to virtual teams.68
People can also lose the intimacy of physically meeting, for instance, in workplaces and cafeterias. To reduce this problem, companies such as Nokia are careful
to select people who have a collaborative mindset. At Nokia, team members are
encouraged to network online and to share their pictures and personal biographies. In another example, Accenture, a worldwide consulting organization, yearly
involves 400 managers in virtual team leadership training. The goal is to create team
effectiveness and to promote understanding of cross-cultural differences. Further,
TeamBuilding, a company in Guelph, Ontario that supports corporate team-building
activities, had a major increase in business following the global COVID-19 pandemic. Before the pandemic, their team-building activities were strictly face-to-face
interactions. When organizations moved to virtual teams, TeamBuilding revamped
its strategy and began offering virtual team-building activities. They mail the necessary items in advance and compete in camp games and challenges on Zoom
or other videoconferencing platforms. Games include a scavenger hunt and ghost
stories around a virtual “camp re.” Michael Alexis, the company’s CEO, said that
since April of 2020, “we’ve grown both revenue and pro t and are now doing two
times more revenue than we were pre-COVID. As long as a market for virtual team
building exists, we will continue to offer these events.”69
Regardless of the structure or purpose of the team, the following characteristics have been identi ed with successful teams:
●
commitment to shared goals and objectives;
●
motivated and energetic team members;
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martin-dm/ E+/ Getty Images
Online services such as Skype,
Zoom, and iMeet allow virtual
workers to get acquainted with
others.
●
open and honest communication;
●
shared leadership;
●
clear role assignments;
●
climate of cooperation, collaboration, trust, and accountability; and
●
recognition of con ict and its positive resolution.
Unfortunately, not all teams succeed or operate to their full potential. Therefore,
in adopting the work team concept, organizations must address several issues that
could present obstacles to effective team function, including overly high expectations, group compensation, specialized team training, career movement, and con ict
resolution. For example, new team members must be retrained to work outside their
primary functional areas, and compensation systems must be constructed to reward
individuals for team accomplishments. Importantly, research shows that teams
achieve greater effectiveness when team members initially establish team ground
rules, or team norms, for operational and behavioural success. HRM Experience, at
the end of the chapter, presents an exercise to set team ground rules.
Another dif culty with work teams is that they alter the traditional manager–
employee relationship. Managers often nd it hard to adapt to the role of leader
rather than supervisor and sometimes feel threatened by the growing power of
the team and the reduced power of management. Furthermore, some employees
may also have dif culty adapting to a role that includes traditional supervisory
responsibilities. Therefore, from our experience in working with teams, extensive
attention must be given to training team members as they move through the four
stages of team development: forming, storming, norming, and performing.70
Fle x ib le W o r k Sc h e d u le s
Flexible work schedules are not a true part of job design because job tasks
and responsibilities are not changed. Nevertheless, we discuss adjustments in
work schedules here because they alter the normal workweek of ve eighthour days in which all employees begin and end their workday at the same
time. Employers may depart from the traditional workday or workweek in their
attempt to improve organizational productivity and morale by giving employees
increased control over the hours they work.71
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Speaking on the importance of exible work schedules, Lois Brakon, codirector of the Families and Work Institute, notes, “Flexible schedules are going
to be the way good, competitive businesses work.” Flexible work schedules may
be assigned by the organization or requested by individual employees—and are
particularly valuable to students. The more common exible work schedules are
the compressed workweek, extime, job sharing, and telecommuting.
Co m p re sse d W o rkw e e k
Under the compressed workweek, the number of days in the workweek is shortened
by lengthening the number of hours worked per day. This schedule is best illustrated by the 4-day, 40-hour week, generally referred to as 4/10 or 4/40. Employees
working a 4-day workweek might work 10 hours a day, Monday through Thursday.
Zorra Township in Ontario has recently announced that it would be initiating
a pilot program that would offer a 40-hour workweek over 4 days rather than
5.72 Although the 4/ 10 schedule is probably the best known, other compressed
arrangements include reducing weekly hours to 38 or 36 or scheduling 80 hours
over 9 days (9/ 80), taking 1 day off every other week. Managers cite many reasons
for implementing compressed workweek schedules, including
●
recruitment and retention of employees,73
●
constraining time encourages quality time,74
●
reduced job stress,
●
improved work–life balance, and
●
increased work productivity.75
Fle x t im e
extime
Flexible working hours that permit employees the option of choosing daily starting and
quitting times provided that they work a set
number of hours per day or week
160
Flex t im e , or exible wor kin g hou r s, p ermits emp loyees th e op tion of ch oosin g
d aily startin g an d quittin g times p rovided th at th ey work a certain n u mber
of h ou rs p er d ay or week. With extime, emp loyees are given con siderable
latitu d e in sch ed u lin g th eir work. However, th ere is a “core p eriod ” d u rin g
th e morn in g an d aftern oon wh en all emp loyees are requ ired to be on th e
job. Flexible workin g h ou rs are most common in service-typ e organ ization s—
n an cial in stitu tion s, govern men t agen cies, an d oth er organ ization s with
large clerical op eration s.
Flextime provides both employees and employers with several advantages.
By allowing employees greater exibility in work scheduling, employers can
reduce some of the traditional causes of tardiness and absenteeism.76 Employees
can adjust their work to accommodate their particular lifestyles and, in doing so,
gain greater job satisfaction. Employees can also schedule their working hours
for the time of day when they are most productive. In addition, variations in
arrival and departure times can help reduce traf c congestion at the peak commuting hours. In some cases, employees require less time to commute, and the
pressures of meeting a rigid schedule are reduced.
As a radical idea for extime, a Hamilton, Ontario-based comp any called
Mabel’s Labels allows emp loyees to start work when they want to and leave
when they desire. Emp loyees can even take a three-hour p ortion of the day and
sp end it on p ersonal activities if they want. The only necessity is to get the work
done. This strategy is p art of a exible work hour p hilosop hy called the Results
Only Work Environment that Mabel’s Labels and other comp anies have accep ted
in which emp loyees are only assessed on the results of their work.77
There are, of course, several disadvantages to extime. First, it is not suited
to some jobs. It is not feasible, for example, where speci c workstations must be
staffed at all times. Second, it can create problems for managers in communicating
with and instructing employees. Flextime schedules may also force these managers
to extend their workweek if they are to exercise control over their subordinates.
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Jo b Sharing
The arrangement whereby two part-time employees perform a job that otherwise
would be held by one full-time employee is called job sh ar in g. Job sharers
usually work three days a week, “creating an overlap day for extended face-to-face
conferencing.”Their pay is three- fths of a regular salary. Employers note that without
job sharing, two good employees might otherwise be lost. OMERS, a Canadian
pension fund, offers a job share program through their company. Employees who
partake in the program may be continuous full-time (CFT) employees before the
job share who, upon partaking in the job share, are considered CFT with a leave of
absence. For example, a CFT individual who participates in a job share assignment
that would temporarily reduce their workweek from ve days a week to three
days a week would keep their CFT employment status. The two days that are
not worked a week would be considered a leave of absence. Alternatively, the
previously CFT employee might change their employment status from CFT to other
than continuous full-time (OTCFT). Suppose individuals partaking in the job-share
program are OTCFT before job sharing and then participating in the job-sharing
program. In that case, upon partaking in the job share program, an individual will
be considered OTCFT with a leave of absence or change their employment, such
as a reduction from their regular timed work.78
Job sharing is suited to the needs of families in which one or both spouses
desire to work only part-time.79 It is also suited to the needs of older workers who
want to phase into retirement by shortening their workweek. For the employer,
the work of part-time employees can be scheduled to conform to peaks in the
daily workload. Job sharing can also limit layoffs in hard economic times. A nal
bene t is that employees engaged in job sharing have time off during the week
to accommodate personal needs, so they are less likely to be absent.
Job sharing does have several problems, however. Employers may not want
to employ two people to do the work of one because the time required to orient
and train a second employee constitutes an added burden.80 Additionally, when
a manager divides a job between two employees, the boundaries of the distribution of responsibility is often unclear.81 The key to making job sharing work is
good communication between partners, who can use a number of ways to stay in
contact—phone calls, written updates, email, and voice mail.
job sharing
The arrangement whereby two part-time
employees perform a job that otherwise
would be held by one full-time employee
telecommuting
Use of personal computers, networks, and
other communications technology to do
work in the home that is traditionally done in
the workplace
Te le c o m m uting
Telecom m u tin g is the use of personal computers, networks, and other communications technology to do work in the home that is traditionally done in the
workplace. A variant of telecommuting is the vir tu a l of ce, which is a business
that is located only in cyberspace. A virtual of ce permits employees to work
from a virtual location. Some companies with virtual of ces may have a physical
address for clients and customers, a professional phone-answering service and
occasional of ce space and conference room rentals.82
Telecommuting has several advantages, including
●
●
●
●
●
●
●
●
●
increased exibility for employees—better work–life balance;83
reduced absenteeism;84
decreased turnover;85
retention of valued employees who might otherwise quit;
reduced “carbon footprints” through minimizing daily commuting;
increased productivity (e.g., reduced wasted of ce time) for creative tasks;86
increased engagement at the individual level;87
lower overhead costs and reduced of ce space;
decreased prevalence of depression;88
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●
those that had the choice to telecommute, whether they decided to telecommute or not, had increased organizational commitment;89
●
increased perception of autonomy, leading to positive outcomes;90
●
increased job performance; and 91
●
decreased work interference with family.92
Non-telecommuters also had an increased chance of obesity, alcohol abuse,
physical inactivity, and tobacco use.93 Although telecommuting offers signi cant
bene ts to employers, it also presents potential drawbacks. These include the
loss of productivity on more mundane tasks,94 loss of coordination,95 decreased
productivity when tasks required high interdependence,96 the dif culty of
developing appropriate performance standards and evaluation systems for telecommuters, and the need to formulate an appropriate technology strategy for
allocating the necessary equipment.97 The lack of social proximity from telecommuting could also negatively impact social and professional isolation, communication, relationships, knowledge sharing, and innovation. The relationship
between telecommuting and job satisfaction is curvilinear. Employees are satised when they telecommute minimally, but satisfaction plateaus and reduces if
they telecommute 15 hours or more per week.98 Traditional line managers accustomed to managing by observation may nd supervising distributed employees
stressful.99 Additionally, managers may believe that telecommuting negatively
affects employee–supervisor relationships through loss of knowledge or information, and a sense of connectedness.100 Further, one study found that women who
telecommuted were also found to have lower wage growth, while another study
found the opposite effect. Thus, more research is needed to understand telecommuting’s impact on wages.101
Employers wishing to have their employees telecommute must comply with
wage and hour laws, liability and workers’ compensation regulations, equipment
purchase or rental agreements with employees, and all employment equity regulations (see Chapter 3). Employees who are denied the opportunity to work from home
may feel discriminated against and resent home telecommuters. Figure 4.8 presents
suggestions for establishing a successful telecommuting program. Highlights in
HRM 4.3 discusses working from home during the COVID-19 pandemic.
F ig u r e 4 .8
Ke ys fo r Suc c e ssful Te le c o m m uting
●
●
●
●
Identify jobs best suited to distance work. Those involving sales, customer service, and auditing are logical
choices.
Select responsible employees. Employees who are selfstarters, motivated, and trustworthy and who can work
independently are ideal candidates. Establish employee
feedback procedures and performance review methods
for employee evaluation.
Establish formalized telecommuting procedures. Telecommuting guidelines could cover hours of availability,
of ce reporting periods, performance expectations, and
weekly progress reports or email updates.
Begin a formal training program. Training for both telecommuters and managers should include the technical
aspects of equipment use and relationship factors such
as how and when to contact the of ce or availability and
location of support facilities.
●
●
Keep telecommuters informed. Physical separation can
make telecommuters feel isolated and invisible. Department and staff updates, inclusion of telecommuters
on project teams, required attendance at meetings,
and “chat room” discussions all keep telecommuters
“in the loop.”
Recognize when telecommuting is not working. State in
telecommunicating policies that the arrangement may
be terminated when it no longer serves company needs
or if the employee’s performance declines.
Source: Adapted from Barbara Hemphill, “Telecommuting Productivity,” Occupational Health and Safety 73, no. 3 (March 2004): 16.
162
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Highlights in HRM 4.3
Fle xtim e and W o rking fro m H o m e am id st COVID- 19
Sarah Mangat, a millennial Vice President of Growth for the
Vancouver startup Charli.ai, started working at her company
at the beginning of the pandemic. She had worked one day in
the of ce before the company ordered employees to work from
home. Mangat spoke about her past work experiences: “I’ve
worked 100 percent in the of ce before, which after a while
wears on you because, at that time, I had a 45-minute commute
into the of ce and an hour-and-a-half commute back.” Mangat
said that she has found working from home bene cial both for
her productivity and overall well-being. “In general, I just feel
like I’m taking better care of myself. I’m eating more consistent meals . . . I feel like I’m focused more on my health and
wellness because you have more control over that in your own
space.” Mangat also explained that “for a lot of my day-to-day
work, I am 10 times more productive if I am at home because I
have a lot more control over the distractions.”
Many individuals feel the same way as Mangat. In a study
of Canadians working from home during the pandemic, 45
percent of individuals reportedly said that, once the pandemic
is over, they would like to continue to work from home, at
minimum, 3 days per week. Yet another 15 percent of individuals reportedly stated that they would like to work from home
1 to 2 days per week. Younger employees were especially more
likely to feel as though exible work is the way of the future.
According to the study, 44 percent of individuals aged 18 to
34 felt that their employers would enact more exible policies,
including extime and remote work, within the next 5 years.
Additionally, 28 percent of individuals within the same age
range felt most people would be working completely remotely
within 5 years.
With the realization that individuals can be productive from
home and often prefer to work from home, organizations are
now offering more work-from-home opportunities. Organizations
realize they may not need the same amount of expensive of ce
space as they once did. Emily Brine, Chief Talent Of cer of
Accounting from KPMGCanada, has started to plan what their
of ce will look like in the future. “Do we have hoteling space
versus broader collaboration space, more whiteboards, less
of ce cubicle space?” Brine said. “Many organizations and
certainly a lot of our clients are talking about this as well.”
New opportunities are available that offer more exibility. The shift to a more permanent work-from-home option
has been seen across industries. For example, Google has
declared that it will test a exible workweek. Employees would
work three days per week in the of ce and telecommute the
remaining two days. In a new poll, over half of human resources
managers told Robert Half that their company would be offering
extime work options. Meanwhile, 45 percent noted that they
would be offering compressed workweeks, job sharing, and
permanent part-time arrangements.
These workforce changes are creating new opportunities
for individuals who need exibility. Zahida Machan, who had
previously occupied managerial positions, had taken a more
junior position a few years ago after having a child. The junior
position had offered her the exibility to work from home. Yet,
Machan noticed many new opportunities available during the
global pandemic that offered extime and work-from-home
opportunities. Machan felt as though she could again search
for a position that matched her skill and experience level. “I am
seeing different doors open,” she said.
Despite the bene ts of working from home, another study
by Robert Half revealed some drawbacks amidst COVID-19. Of
the respondents, 54 percent stated that they work on weekends, over one-third of which reported working more than 8
hours a day. As a result, employees feel unable to disconnect or
log off from work, termed “hyper-connectivity.” Workers are also
complaining of “video call fatigue.” David King, Canadian Senior
District President at Robert Half, explained, “Video calls often
require more energy than other communication means such as
phone calls or email. With many employees already managing
heavy workloads, limiting them to those that are necessary
can help reduce meeting fatigue and increase focus time for
employees.” Yet therein lies another dilemma. Many individuals
also complain about a lack of interaction and sociability as their
main issue working from home.
Further, other employees complain of physical and emotional issues, such as back pain from an improper home of ce
setup and anxiety. Some workplaces are already starting to
consider the future implications of a new norm of working from
home. For example, Canada’s Federal Labour Code does not
include a right to disconnect for federal workers. The Canadian
Labour Congress has been advocating for that to change
through a legislative effort. Other similar factors will need to be
considered when planning, strategizing, and writing policies
for working from home and exible work as it increasingly
becomes the new norm and the future of work.
(Continued )
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Sources: Brandie Welkie, “Of ce Work Could Be Changed Forever by COVID-19. Here’s Why That Matters,” CBC (September 7, 2020); Kathryn Vasel, “Google
Delays a Return to the Of ce Until September,” CTV News (December 14, 2020); Daniel Tencer, “Working From Home Amid COVID-19, Sore Backs and ‘Zoom
Call Fatigue’,” Huf ngton Post (November 28, 2020); Christy Somos, “Pandemic, Working From Home, and Hyper Connectivity Propelling ‘Right to Disconnect’
Push in Canada,” CTV News (June 10, 2021); Maryse Zeilder, “Working From Home Post-Pandemic Could Offer Mixed Results for Women, Researchers Say,”
CBC (June 5, 2021).
Check In
Describe the types of teams you have worked with. Were some more successful than others? If so,
why? How can you apply what you have learned in a team environment to an HR context?
Small Business Application
As we have seen, to effectively provide performance feedback
or to recruit and train new employees, developing and
optimizing job requirements are key actions. Although this
is not different in small companies, what is different is that
in small enterprises (1) these job requirements may be less
structured than in large companies, (2) requirements may be
more individualized to factor in the individual talents of team
members, and (3) these requirements are less likely to be
written down.
Take, for example, a small Internet development company
with 25 employees. These 25 employees are involved in either
sales, website development, or website maintenance for a
variety of clients. Although theremay be general classi cations of
roles—some people will be involved in sales, some in development, and some in maintenance—it will likely be the case that
every employee in the company, rather than having speci c
duties, will be drawn based on their skills and how busy that
person is. For example, a client may have identi ed that it would
like to have a new feature added to its website. The employee
responsible for the support of this site may not be thebest person
on the team to develop this new feature. The entire team will be
consulted to determine who has developed, or could develop, the
necessary skills. The end result is that the determination of what
is to be done and who is to do it is based on situational requirements and the allocation of talent at that point in time.
This highlights a primary challenge in all organizations.
Organizations hire individuals but then manage teams to deliver
on changing requirements. In small enterprises especially,
although the core job requirements will consist of a collection
of tasks generally associated with the performance of the role,
employees will be required to support requirements outside
a prescribed job requirement. Small enterprises often neglect
actions such as written job requirements or written performance
reviews. These acts may be deemed to be unnecessary formalities that are counter to the informal culture in small companies.
The advantages to both the company and employees are twofold. First, documenting job requirements increases operational
ef ciency in recruiting and training future employees. Second,
performance evaluations result in improving the effectiveness
and morale of existing staff. What is different in small enterprises is that each of these will be carried out by a manager
without the support of an HRprofessional.
Summary
Outcome 1
Job requirements re ect the different
duties, tasks, and responsibilities required in jobs. Job
requirements, in turn, in uence HR functions performed
by managers, including recruitment, selection, training
and development, performance appraisal, compensation,
and various labour relations activities.
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Outcome 2 Job analysis data may be gathered using
several collection methods—interviews, questionnaires,
observations, and diaries. Other, more quantitative
ap proaches include the PAQ system, critical incident
method, task inventory analysis, and comp etency-based
analysis. It is the p revailing op inion of the courts that
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HRM decisions on employment, p erformance ap p raisal,
and p romotions must be based on sp eci c criteria
that are job related. These criteria can be determined
objectively only by analyzing the requirements of each
job.
The format of job descriptions varies widely, often
re ecting the needs of the organization and the expertise of the writer. Job descriptions should be written in
clear and speci c terms, with consideration given to
their legal implications.
Outcome 3 Job design is a combination of four basic
considerations: organizational objectives; industrial
engineering concerns of analyzing work methods and
establishing time standards; ergonomic considerations,
which accommodate human capabilities and limitations
to job tasks; and employee contributions.
In the job characteristics model, ve job factors
contribute to increased job performance and satisfaction: skill variety, task identity, task signi cance,
autonomy, and feedback. All factors should be built into
jobs because each factor in uences different employee
psychological states. When jobs are enriched through
the job characteristics model, employees experience
more meaningfulness in their jobs, acquire more job
responsibility, and receive direct feedback from the
tasks they perform.
Outcome 4 To imp rove the internal p rocess of organizations and increase p roductivity, greater efforts
are being made by organizations to involve group s
of emp loyees in work op erations. Emp loyee involvement group s are comp osed of emp loyees in work
units charged with offering suggestions for imp roving
p roduct or service quality or fostering workp lace
effectiveness. Emp loyee teams stress emp loyee collaboration over individual accomp lishment. Teams rely
on the exp ertise and different abilities of members to
achieve a sp eci c goal or objective. Self-directed teams
are characterized by their willingness to p erform traditional managerial tasks.
Changes in work schedules—some triggered by the
COVID-19 pandemic—which include the compressed
workweek, extime, job sharing, and telecommuting,
permit employees to adjust their work periods to
accommodate their particular lifestyles.
Key Terms
critical incident method, 143
employee empowerment, 151
employee involvement groups
(EIGs), 155
employee teams, 157
ergonomics, 153
extime, 160
functional job analysis (FJA), 143
industrial engineering, 151
job, 135
job analysis, 139
job characteristics model, 151
job crafting, 151
job description, 136
job design, 149
job enrichment, 150
job family, 135
job sharing, 161
job speci cation, 136
position, 135
position analysis questionnaire
(PAQ), 142
task inventory analysis, 143
telecommuting, 161
virtual teams, 158
Discussion Questions
1. Why is job analysis often described as the
“bedrock” of HRM practices? In your answer,
explain how job analysis helps with HRM
practices such as recruitment, selection,
compensation, and performance appraisals.
2. Discuss the various methods by which job analysis
can be completed. Compare these methods, noting
the pros and cons of each.
3. The description of the “human resources business
partner” position sometimes varies across
organizations. For instance, in some organizations,
it is a mid-level position, whereas in others, it
is management. Search the Internet for a few of
these job descriptions and compare them. How
can this “problem” be solved?
4. Discuss how the COVID-19 pandemic has changed
the way work is/ has been reorganized.
5. The job characteristics model has ve components
that enhance employee jobs: skill variety,
task identity, task signi cance, autonomy, and
feedback. Give an example illustrating how
each component can be used to improve the
organization and the job of the employee.
(Suggestion: Consider your present or a recent job
to answer this question.)
6. Figure 4.7 sh ows th e d ifferen t forms of
emp loyee teams. Provid e an examp le of wh ere
each typ e of team can be u sed . How d o teams
create syn ergy?
7. An argument could be advanced that some
job design methods, including those involving
industrial engineering, have led to employees
being “deskilled” and “alienated from their work.”
Debate this issue.
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HRM Experience
Estab lishing Gro und Rule s fo r Te am Suc c e ss
Ground rules—or team norms—are agreed-on formalities that
guide the behaviour of a team’s members, including how they want
to be treated and how they agree to treat others. Ground rules help
teams maintain order, promote positive behaviour, and can be used
to correct undesirable actions.
Assignment
1. Divide your class into teams.
2. Using the list below, have each team member silently select
10 behaviours they believe are most critical for a team’s
success. The rst list of 10 behaviours (each person’s A list)
should consist of those most important for group conduct.
The second list of 10 behaviours (each person’s B list) should
consist of those that are desirable.
3. Next, have the members of your team select a nal list of 10
behaviours from both lists. These will become your team’s
ground rules. The items can be modi ed or combined to meet
your team’s speci c needs.
Behaviours List
While working in teams, individuals should do the following:
1. Do their fair share of the work.
2. Check to ensure that everyone clearly understands what is
to be done.
3. Encourage planning, including short-range agendas and longrange goals.
4. Encourage open and candid opinions about issues.
5. Listen willingly and carefully to other people’s ideas, even if
those people have a different viewpoint.
6. Prepare thoroughly before meetings.
7. Make team members feel at ease in discussion.
8. Ask questions when they do not clearly understand tasks or
procedures.
9. Propose speci c analyses of the pros and cons of decisions
faced by the team.
10. Follow through on task assignments.
11. Help other members when assistance is requested.
12. Treat all team members as equals.
13. Paraphrase or restate what someone else says to check
meaning.
14. Openly voice opinions and share ideas.
15. Be exible in arranging meeting schedules.
16. Compliment others for things they have said or done.
17. Be willing to meet whenever it is necessary to discuss a
problem.
18. Deal with con ict directly, bringing it to the attention of the
team.
19. Express enthusiasm about what the team is doing.
20. Encourage budgeting of the team’s time.
21. At the end of a meeting, restate their own responsibilities to
check for agreement.
22. Be serious about the team’s work.
23. Arrive on time for regularly scheduled meetings.
24. Be willing to listen to other team members’ ideas.
25. Get the team’s approval on important matters before
proceeding.
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Case Study 1
Yahoo Cuts the Cord on Telecommuting
GK Images/ Alamy
Stock Photo
Not everyone thinks telecommuting is ideal for their
organizations. In early 2013,
Marissa Mayer, who had
been named Yahoo’s new
CEO less than a month earlier, ended telecommuting
at the struggling Internet-search company. Reportedly,
16
in 2013, Mayer learned that many of Yahoo’s telecommuters weren’t logged onto Yahoo’s intranet when they
were supposed to be and that the company’s of ces
were nearly empty on Fridays. It’s also likely that Mayer
thought some synergy was being lost by telecommuting
because it left fewer Yahoo employees communicating
face to face with one another. The memo Yahoo sent its
employees announcing telecommuting would be discontinued read: “It is critical that we are all present
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in our of ces. Some of the best decisions and insights
come from hallway and cafeteria discussions, meeting
new people and impromptu team meetings.”
Yahoo’s decision surprised people because telecommuting is particularly prevalent in high-tech industries,
particularly in Silicon Valley, where Yahoo is located.
How could the rm hope to compete for employees
in the area if it ended telecommuting? One tech news
outlet called it “the worst decision Marissa Mayer has
made in her tenure as Yahoo CEO.”
Silicon Valley isn’t the only place where telecommuting has taken off, however. In an American study
from 2017, it was discovered that the number of individuals working from home at least 50 percent of the
time increased by 115 percent since 2005. Further,
according to Statistics Canada, amid the pandemic
nearly one-third of Canadians worked from home in
January 2021, compared to just four percent in 1996.
Of the Canadians working from home during the pandemic, two-thirds anticipate continuing to work from
home after the pandemic is over. Many rms have
embraced telecommuting, claiming that it leads to more
productivity and a better work–life balance.
However, according to recent studies, work that is
more complicated or multifaceted or involves speed,
problem-solving, or teamwork may be less effective
when not performed face-to-face with colleagues.
Further, KPMG research found that in the pandemic,
although people can work independently from home,
people increasingly felt less productive in the second
lockdown than they were during the rst lockdown.
During the global pandemic, organizations have
been using and relying on the practices that Yahoo
rejected in 2013. In fact, work-from-home policies are
key strategies keeping many companies a oat. “The
one overriding piece of feedback is that working from
home is far better than anyone expected,” Nicholas
Bloom, a professor of economics at Stanford University,
says. “We’re hearing that rms get the perception
people are working harder.”
Questions
1. How can a rm know when it’s a good idea to
implement telecommuting or not?
2. Can you think of any other pros and cons related to
telecommuting that aren’t mentioned in this case?
Sources: James Surowiecki, “Face Time,” The New Yorker (March 18, 2013), http://www.newyorker.com; Chris Isidore and Paul Steinhauser, “Americans Say
Telecommuting Works,” CNNMoney (March 14, 2013), http://money.cnn.com; “Best Buy Copies Yahoo, Reigns in Telecommuting,” USA Today (March 6, 2013), http://www.
usatoday.com; John Challenger, “Yahoo’s Telecommuting Ban Shows Mayer Is Working,” MarketWatch (March 4, 2013), http://www.marketwatch.com; Eleanor Cummins,
“Shirking from Home,” Vox (July 22, 2020); Global Workplace Analysts, “115 Percent Increase in Telecommuting Since 2005, According to Global Workplace Analytics
Report Sponsored by Flexjobs,” https://globalworkplaceanalytics.com/brags/news-releases#BM, retrieved June 14, 2021; Maryse Zeilder, “Working From Home PostPandemic Could Offer Mixed Results for Women, Researchers Say,” CBC (June 5, 2021); Tracy Brower, “Why Too Much Work From Home Could Be Bad for Your Career,”
Forbes (April 11, 2021); KPMGLLP, “Over Three in Four Canadians Like the Idea of a Hybrid Model: A Workplace Reboot,” Newswire (May 19, 2021).
Case Study 2
But, My Job Has Changed!
one photo/ Shutterstock.com
Job descriptions are a
critical tool used for job
orientation and training
and, importantly, in
annual employee performance evaluations.
When the duties and
responsibilities listed
in the job description do not re ect current job content,
employee/ management disagreements can arise, as this
case illustrates.
Both employees and managers agree that Brenda
Batten has been an exceptional employee. As a senior
technical representative (STR) for Blackhawk Aironics,
she is valued for her knowledge in airplane instrumentation. One manager described her as “simply an expert in
the complex technology of satellite weather systems.”
In May 2017, Blackhawk Aironics imp lemented a
new work reorganization p lan. STRs such as Brenda
now work largely by telecommuting with managers and engineers at comp any headquarters and
with customers scattered throughout North America.
Additionally, under the new work p lan, STRs were
given more freedom to deal directly with customers
and engineers without sup ervisory intervention. This
freedom greatly facilitated customer service needs and
demands in an aviation market everyone considers
highly dynamic.
Brenda’s current job description re ects the technical
dimensions of her position but not the telecommuting
requirements now performed. Personal competencies such as decision making, self-motivation, problem
solving, and communication skills are not covered.
In May 2018, Brenda met with her manager, Martin
Eaton, for her annual performance review. Unfortunately,
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unlike past meetings, which were highly satisfactory, this
meeting quickly developed into a disagreement. At the
centre of the controversy were the factors to be used to
measure Brenda’s new job demands. Martin wanted to
place major emphasis on the tasks and duties listed in
her current job description. As he explained to Brenda, “I
hardly see you anymore, and I have no objective criteria
or performance data by which to measure those behaviours you now use.” Brenda, in response, acknowledged
that some things in the current job description were
still important aspects of her job, but, overall, the current job description did not capture the full scope of her
new duties and responsibilities. Brenda concluded that
she was satis ed with Martin’s evaluation of the technical
aspects of her job, but she was clearly not pleased with
the overall evaluation of her performance. As she told
Martin, “It’s simply not fair; you just don’t know what I
do now.”
Questions
1. Given the facts of this case, is it possible for Brenda
and Martin to reach a satisfactory result? Explain.
2. How can an organization identify and measure the
personal competencies of employees?
3. How can the company prevent this problem from
occurring in the future? Explain.
Source: Based on an actual case known to the authors. All names and locations are ctitious.
Case Study 3
The Zappos Experiment
IgorGolovniov/ Shutterstock.com
There are many different ways in which
rms can organize
themselves. There are
at organizations and
there are tall organizations. There are
organizations structured by products,
divisions, and geography. But one thing nearly all structures have in common is a chain of command, or hierarchy. Do comp anies have to set up that way? Tony
Hsieh didn’t think so. Hsieh was the CEO of Zap p os,
the online seller of shoes. Hsieh thought outside of
the box. When he started Zap p os in 1999, no one was
selling shoes online. It seemed like a crazy idea—you
can’t try on shoes online to see if they t. But Zap p os
made the business work by offering good p roduct,
free ship p ing and returns, and great customer service.
In 2009, Amazon acquired Zap p os for $1.2 billion but
kep t Hsieh on as CEO. Hsieh had exp ressed to the
p ublic that he had chosen to sell to the e-commerce
giant to Amazon as it acknowledged “the uniqueness
of Zap p os’s culture and Amazon’s duty to p rotect it.”
Hsieh believed it’s not just the Zappos business
model that has led to its success. Employees and their
satisfaction are responsible, too. To keep workers
happy and passionate about their jobs, the company
offers top-of-the-line and unusual perks: good pay,
free healthcare, and employees can bring their dogs
to work if they are well socialized. Quirky celebrations and parties are the norm at the company, which
routinely makes For tu n e’s “Best Places to Work” List.
168
Further, when new employees are hired, they start a
ve-week training program. At the end of ve weeks,
they are offered $2,000 to quit to solidify that they feel
the workplace is right for them.
Hap py Zap p onians and a booming business
weren’t enough for Hsieh though. He had noticed that
most comp anies on the For tu n e 500 list in 1955 were
no longer on it today. In fact, many of them no longer
existed. Hisieh gured it was because as rms grow,
they become slow and lose touch with their customers.
Executives at the top make the decisions, but they don’t
really understand what customers want, how p roducts
can be imp roved, or have a lot ideas for transforming
the business. Lower-level employees—the p eop le
closest to the work—often do, but their suggestions
rarely make it up the food chain. He didn’t want that to
happ en at Zap p os. So what did Hsieh do? In 2014, he
instituted a new typ e of self-management system called
Holocracy. There are no managers at Zapp os anymore.
Everyone is an equal, and no one can tell anyone else
what to do.
Employees at Zappos don’t have job titles. They
have “roles” and their coworkers are their “partners.”
They work together in “circles” (or teams) of their
choosing. The members of a circle meet regularly to
talk about improvements and ideas. A “chit chat” is held
at the beginning of each meeting. Everyone is required
to speak, which ensures even the quietest employee is
heard. A software system then tracks the circle’s goals
and who agreed to do what and when. “Really what
we’re trying to do is turn each employee into a mini
entrepreneur who has the ability to sense ideas and do
something about it,” says John Bunch, who oversees
the Zappos self-governing system.
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There are also no performance appraisals at
Zappos. If you’re doing a poor job, your coworkers will
let you know. Each employee gets 100 “people points”
to distribute to the members in their circles. If an
employee doesn’t get enough points, the person may
get booted from a circle—like contestants get voted
off of the island in Su r vivor. And if the person has no
circle to work in, they are out of job. Pay raises are
based on new skills a person develops, a system called
“badging.” For example, a person might earn a badge
for Java coding or merchandising.
If ditching the old corporate structure for something
new sounds simple, it turned out to be anything but that
for Zappos. First, there were all kinds of rules and meetings required to set up the system. “Tactical” meetings
focused on the work ows, and “governance” meetings
focused on hashing out processes and eliminating roadblocks. Second, employees had trouble understanding
the new system and weren’t sure what they were supposed to be doing. Former managers felt diminished.
They no longer had any power or status, and they never
would. So much for having climbed the corporate ladder.
Writer/ editor Roger Hodge referred to the new Zappos
organizational structure as “a radical experiment . . . to
end the of ce workplace as we know it.”
Hsieh knew the transition wouldn’t be easy, so he
offered employees who didn’t like the new system a
buyout, which amounted to about ve months’ pay.
Eighteen percent of the workforce, or 1,600 employees,
took it. Another 15 percent or so quit later. Morale fell,
and Zappos dropped off of For tu n e’s “Best Companies
to Work for List” for the rst time in its history.
Did Hsieh have any regrets about implementing
such a radical change at an already successful company? No, although he admits he was surprised how
hard it was for people to leave their bureaucratic baggage behind. “In retrospect, I would have probably
ripped off the Band-Aid sooner,” he said. Employees
say Zappos is running more smoothly now and that
things improved after those who didn’t like the system
left. The company also implemented a program to
better screen and prepare new employees to manage
themselves. And reportedly the rm’s pro t margins
are holding up. Derek Noel, an employee with Zappos,
says the new system has let his ideas be heard and
allowed him to take on a more substantive role in the
company. “My worst day at Zappos is still better than
my best day anywhere else,” he says. “I can’t imagine
going back to traditional hierarchy anymore.”
Hsieh spent around 20 years at Zappos before retiring;
he passed away soon after, in 2020. Kedar Deshpande
assumed the role of CEO in 2020. Deshpande had worked
at Zappos since 2011, starting as a Portfolio Manager
and moving his way up to COO before becoming CEO.
Desphande, therefore, had a good understanding of the
culture and values of the organization. However, his transition did not come without struggle. Deshpande was
responsible for guiding Zappos through the later phases
of the pandemic and towards the company’s next business stages without Hsieh’s support. There was no longterm succession plan when Hsieh retried. Deshpande
was also tasked with proving that the company’s culture
of “fun and a little weirdness” can endure without Hsieh.
“The COVID situation and everything else going on make
it very tough, particularly with a culture that is built on
physical proximity and happiness associated with that,”
Deshpande explained in a Zoom interview. Erik Gordon,
a professor at the University of Michigan Ross School of
Business, also predicted Zappos’ culture would experience some challenges, claiming that it would be dif cult
to replace a CEO with such a large personality.
However, Deshpande remains optimistic, explaining,
“the culture is not just one person or two people,” he
said. Deshpande also claims that the work culture has
grown even closer in the year of the global pandemic and
in the virtual realm, as staff get to know one another’s
families and pets. Families participate in events, such as
Halloween contests, as well, and Zappos has tried sending
packages to employees, such as materials for planting
herb gardens or science experiences. He also predicted
that it would likely be part-time in person and part-time
working from home when employees come back to the
of ce. Desphande also anticipates revisiting the business
strategy to look for novel ways to add to the customer’s
online shopping experience. Yet, the new CEO anticipates
that employees will enduringly exemplify the values that
Hsieh championed. “To me, Tony’s legacy is around delivering this happiness to everybody,” Deshpande said. “This
culture he has created or pioneered, it’s going to be alive.”
Questions
1. Is a self-managing organization a good idea? Why
or why not?
2. Could Zappos have done anything to make the
transition to the new system smoother? If so, what?
Sources: Zack Guzman, “Zappos CEOTony Hsieh on Getting Rid of Managers: What I Wish I’d Done Differently,” CNBC (September 13, 2016), http://www.cnbc.com;
Yuki Noguchi, “Zappos: A Workplace Where No One and Everyone Is the Boss,” NPR (July 21, 2015), http://npr.org; Jennifer Reingold, “How a Radical Shift Left Zappos
Reeling,” Fortune (March 4, 2017), http://fortune.com; Camille Sweeney and Josh Gos ed, “No Managers Required: How Zappos Ditched the Old Corporate Structure for
Something New,” Fast Company (January 6, 2014), https://www.fastcompany.com. (c) 2019 Cengage Learning; Kim Lyons, “Former Zappos CEOTony Hsieh Dies at 46,”
The Verge (November 28, 2020); Avery Hartmans, “Tony Hsieh, the Former Visionary CEOof Zappos, Has Died. Here’s How His Radical Business Philosophy Transformed
Zappos and Made Him ‘A Pioneer of Culture,” Business Insider (November 30, 2020); The Associated Press, “Tony Hsieh, Retired Zappos CEO, Dies at 46,” CTV News
(November 28, 2020); Katie Abel, “What to Know About Zappos CEOKedar Deshpande,” Footwear News (August 25, 2020); Sapna Maheshwari, “After Tony Hsieh’s
Shocking Death, Zappos Looks to Move Forward,” Las Vegas Sun (March 23, 2021).
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Notes and References
1. Stephane Girod and Richard Whittington, “Recon guration,
Restructuring and Firm Performance: Dynamic Capabilities
and Environmental Dynamism,” Stra tegic Ma n a gemen t
Jou rn a l 38, no. 5 (2017): 1121–33; Michael Hammer and
J. Champy, Reen gin eerin g the Cor pora tion (New York:
HarperCollins, 2003); Fariborz Damanpour, “Footnotes
to Research on Management Innovation,” Orga n iza tion
Stu dies 35, no. 9 (2014): 1265–85.
2. Michael Hammer, “The Process Audit,” Ha r va rd
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3. Peter Coy, “COG or Co-worker? The Organization
Man Isn’t Extinct or Even Endangered—But the
Role Has Been Re ned over the Past 100 Years,”
Bu sin essweek (August 2007): 58; Thomas Friedli
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Excellence Initiatives,” in Thomas Friedli, Prabir Basu,
Daniel Bellm, and Jürgen Werani (eds.), Lea din g
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Springer, 2013): 245–61.
4. Arnold B. Bakker, Evangelia Demerouti, and Willem
Verbeke, “Using the Job Demands Resources Model
to Predict Burnout and Performance,” Hu ma n
Resou rces Ma n a gemen t 43, no. 1 (Spring 2004): 83;
Rehman Safdar, Ajmal Waheed, and Khattak Hamid
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Ma n a gemen t 5, no. 2 (Summer 2010): 17–36.
5. Canadian Gaming Centre for Excellence, “Developing
Essential Skills in the Gaming/ Casino Industry
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6. Michael Page, “Recruitment Services,” https:/ / www
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retrieved June 1, 2021.
7. HR Council for Nonpro t Sector, “HR Management
Standards—Second Edition,” (2011), http:/ / www
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8. Deloitte, “Covid-19 The Upskilling Imperative,”
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9. Saturnin Dandala, “Human Resource Policy and
Teacher Appraisal in Ontario in the Era of Professional
Accountability,” Ma n a gemen t in Edu ca tion 33, no. 1
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13. Statistics Canada, “Study: The Employment
Consequences of Robots: Firm-Level Evidence,”
(November 2, 2020).
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Workplace,” Hu ma n Resou rce Ma n a gemen t Review 18,
no. 2 (2008): 87–99.
15. George T. Milkovich and Jerry M. Newman,
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Companies, 2010).
16. MyAbilities Technologies Inc., “MyAbilities Launches
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Analysis Search Engine, with More Than 50,000 Job
Titles,” NewsWire ( January 15, 2020).
17. Frederick P. Morgeson, Kelly D. Klinger, Melinda S.
May eld, Philip Ferrara, and Michael A. Campion,
“Self-Presentation Processes in Job Analysis: A Field
Experiment Investigating In ation in Abilities, Tasks,
and Competencies,” Jou r n a l of Applied Psychology 89,
no. 4 (August 2004): 674; Frederick P. Morgeson and
Michael A. Campion, “A Framework of Potential Sources
of Inaccuracy in Job Analysis,” in Mark Alan Wilson,
Winston Bennett, Jr., Shanan Gwaltney Gibson, and
George Michael Alliger (eds.), The Ha n dbook of Work
An a lysis (New York: Routledge, 2013): 614–22.
18. Human Resources and Skills Development Canada,
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2016,” http:/ / noc.esdc.gc.ca/ English/ noc/ welcome
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19. A detailed description of different job analysis techniques is beyond the scope of this text. For those interested in more comprehensive information or job analysis
tools, see Michael T. Bannick, Edward L. Levine, and
Frederick P. Morgeson, Job a n d Work An a lysis: Methods,
Resea rch, a n d Applica tion s for Hu ma n Resou rce
Ma n a gemen t, 2nd ed. (Thousand Oaks, CA: Sage, 2007).
20. Economic Research Institute, “Position Analysis
Questionnaire (PAQ),” https:/ / www.erieri.com/ paq,
retrieved June 2, 2021.
21. Michael Campion, Alexis Fink, Brian Ruggeberg,
and Linda Carr et al., “Doing Competencies Well:
Best Practices in Competency Modeling,” Per son n el
Psychology 64, no. 1 (2011): 225–62.
22. Marqie Mader-Clark, Job Descr iption Ha n dbook
(Berkeley, CA: Nolo Press, 2006).
23. Moveuptogether, “Collective Agreement,” https
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24. Wayne K. Spear, “Toronto School Board to Scrub ‘Chief’
From Titles is a Cure in Search of a Disease,” CBC
(October 16, 2017).
25. “House of Commons Job Description,”
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2019,” OHRD ( July 1, 2019).
27. Northwestern University, “Competency Based Job
Description,” https:/ / www.northwestern.edu/ hr/ for
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28. Steve Milano, “Competency Based Job Descriptions,”
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29. Shiney Chib, “Competency Mapping—A Tool to Place
Right Person at The Right Place,” REVELATION (2014): 32.
30. Shiney Chib, “Competency Mapping.”
31. Northwestern University, “Competency Based Job
Description,” https:/ / www.northwestern.edu/ hr
/ for-managers/ hiring/ hiring-process/ open-a-position
/ competency-based-job.html, retrieved June 3, 2021.
32. Steve Milano, “Competency Based Job Descriptions,”
Chron , https:/ / smallbusiness.chron.com/ competency
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33. Shiney Chib, “Competency Mapping.”
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Design: Motivating Employees’ Performance,” The Jou rn a l
of Ma n a gemen t Developmen t 25, no. 6 (2006): 572.
36. For Herzberg’s important article on job enrichment,
see Frederick Herzberg, “On e More Time: How Do You
Motivate Employees?” Ha r va rd Bu sin ess Review 46,
no. 2 ( January–February 1968): 53–62.
37. Great Place to Work, “Canada’s Best Workplaces,” (April
27, 2018), https:/ / www.greatplacetowork.ca/ images
/ article/ Globe-and-Mail-Best-Workplaces-2018.pdf,
retrieved June 4, 2021.
38. For the original article on the job characteristics
model, see J. Richard Hackman and Greg R. Oldham,
“Motivation through the Design of Work: Test of
a Theory,” Or ga n iza tion a l Beha vior a n d Hu ma n
Per for ma n ce 16, no. 2 (August 1976): 250–79.
39. Jed DeVaro, Robert Li, and Dana Brookshire, “Analyzing
the Job Characteristics Model: New Support from a
Cross-Section of Establishments,” The In ter n a tion a l
Jou r n a l of Hu ma n Resou rce Ma n a gemen t 18, no. 6
( June 2007): 986; Seejeen Pa rk, “Motivating Raters
Through Work Design: Applying the Job Characteristics
Model to the Performance Appraisal Context,” Cogen t
Psychology 4, no. 1 (2017): 1287320.
40. Amy Wrzesniewski, Justin Berg, and Jane Dutton, “Turn the
Job You Have into the Job You Want,” Ha rva rd Bu sin ess
Review 88, no. 6 ( June 2010): 114–17; Cornelia Niessen,
Daniela Weseler, and Petya Kostova, “When and Why
Do Individuals Craft Their Jobs? The Role of Individual
Motivation and Work Characteristics for Job Crafting,”
Hu ma n Rela tion s 69, no. 6 ( June 2016): 1287–13.
41. Denise Robitaille, “Invaluable Contributions,” In du str ia l
En gin eer in g 39, no. 1 ( January 2007): 32.
42. CBC Radio, “Made-in-Canada Solution: ‘Hockey Hub’
Vaccine Clinics are Getting the Job Done Faster,” CBC
(May 22, 2021), https:/ / www.cbc.ca/ radio/ whitecoat
/ made-in-canada-solution-hockey-hub-vaccine
-clinics-are-getting-the-job-done-faster-1.5953312.
43. Justin M. Berg, Dutton, Jane E., and Amy Wrzesniewski,
Wha t is Job Cra ftin g a n d Why Does it Ma tter? (Ann Arbor,
MI: University of Michigan Ross School of Business, 2013),
https:/ / positiveorgs.bus.umich.edu/ wp-content/ uploads/
What-is-Job-Crafting-and-Why-Does-it-Matter1.pdf.
44. Justin M. Berg, Jane E. Dutton, and Amy Wrzesniewski,
“Job Crafting and Meaningful Work,” in B. J. Dik, Z. S.
Byrne, and M. F. Steger (eds.), Pu r pose a n d Mea n in g in
the Workpla ce (Washington, DC: American Psychological
Association, 2013): 81–104.
45. Maria Tims, Arnold B. Bakker, and Daantje Derks, “The
Impact of Job Crafting on Job Demands, Job Resources,
and Well-Being,” Jou r n a l of Occu pa tion a l Hea lth
Psychology 18, no. 2 (2013): 230.
46. Amy Wrzesniewski and Jane E. Duttonm, “Crafting a Job:
Revisioning Employees as Active Crafters of Their Work,”
Aca demy of Ma n a gemen t Review 26, no. 2 (2001): 179–201.
47. Justin M. Berg et al., “Job Crafting and Meaningful Work.”
48. Amy Wrzesniewski and Jane E. Duttonm, “Crafting a Job.”
49. Justin M. Berg et al., “Job Crafting and Meaningful Work.”
50. Amy Wrzesniewski and Jane E. Duttonm, “Crafting a Job.”
51. Justin M. Berg et al., “Job Crafting and Meaningful Work.”
52. Richard B. Graff, “Job Carving,” in Fred R. Volkmar (ed.),
En cyclopedia of Au tism Spectr u m Disorder s (New York:
Springer, 2013).
53. Richard B. Graff, “Job Carving.”
54. Sriram Narayanan and Ed Terris, “Inclusive Manufacturing:
The Impact of Disability Diversity on Productivity in a
Work Integration Social Enterprise,” Ma n u fa ctu rin g &
Service Opera tion s Ma n a gemen t 22, no. 6 (2020): 1112–30.
55. Sriram Narayanan and Ed Terris, “Inclusive Manufacturing.”
56. Andrew J. DuBrin, Fu n da men ta ls of Or ga n iza tion a l
Beha vior, 4th ed. (Cincinnati, OH: South-Western, 2007):
Chapter 10; Mitra Raappana and Tessa Horila, “Team
Communication in the Workplace,” in Leen a Mikkola
a n d Ma a r it Va lo (eds.), Workpla ce Commu n ica tion
(New York: Routledge, 2019): 28–40.
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57. Andrew J. DuBrin, Fu n da men ta ls of Or ga n iza tion a l
Beha vior, 4th ed. (Cincinnati, OH: South-Western,
2007): Chapter 10; Raj Sanne, “The Bene ts of Creating
Autonomous Work Teams,” In du str ia l Ma n a gemen t 63,
no. 1 (2021).
58. Adrian Rohrbasser, Janet Harris, Sharon Mickan, Kali
Tal, and Geoff Wong, “Quality Circles for Quality
Improvement in Primary Health Care: Their Origins,
Spread, Effectiveness and Lacunae—A Scoping Review,”
PLoS On e 13, no. 12 (2018): e0202616.
59. Brian Hindo, “The Empire Strikes at Silos,” Bu sin essweek
(August 20, 2007): 63; Michale Schneider, “Google Spent
2 Years Studying 180 Teams. The Most Successful Ones
Shared These 5 Traits,” In c., https:/ / www.inc.com
/ michael-schneider/ google-thought-they-knew-how-to
-create-the-perfect.html, retrieved April 23, 2018; Charles
Duhigg, What Google Learned from Its Quest to Build
the Perfect Team,” New York Times Ma ga zin e (February
26, 2016), https:/ / www.nytimes.com/ 2016/ 02/ 28/
magazine/ what-google-learned-from-its-quest-to-buildthe-perfect-team.html, retrieved April 23, 2018.
60. Roy C. Herrenkohl, Becomin g a Tea m: Achievin g a
Goa l (Mason, OH: South-Western, 2004); Mercedes
Rubio-Andrés, Santiago Gutiérrez-Broncano, and Luis
Varona-Castillo, “Self-Managing Teams in Small and
Medium Enterprises (SME),” in Information Resources
Management Association (ed.), Hu ma n Per for ma n ce
Techn ology: Con cepts, Methodologies, Tools, a n d
Applica tion s (Pennsylvania, PA: IGI Global, 2019):
1453–75.
61. Vojko Potocan and Bostjan Kuralt, “Synergy in Business:
Some New Suggestions,” Jou r n a l of Amer ica n Aca demy
of Bu sin ess 12, no. 1 (September 2007): 199.
62. Leigh Thompson, “Improving the Creativity of
Organizational Work Groups,” The Aca demy of
Ma n a gemen t Execu tive 17, no. 1 (February 2003):
96; Somchaya Liemhetcharat and Manuela Veloso,
“Modeling and Learning Synergy for Team Formation
with Heterogeneous Agents,” in Pr oceedin gs of the 11th
In ter n a tion a l Con feren ce on Au ton omou s Agen ts a n d
Mu ltia gen t Systems—Volu me 1 (2012): 365–74. 2012.
63. Shoppers Drug Mart, “Shoppers Drug Mart Launches
Ecommerce Platform for Medical Cannibis,” Newswire
( January 8, 2019).
64. Emily Douglas, “HR Analysis: How to Implement a
Successful WFH Model,” Hu ma n Resou rces Director
(November 27, 2020).
65. Kathryn Vasel, “Google Delays a Return to the Of ce
Until September,” CTV News (December 14, 2020),
https:/ / www.ctvnews.ca/ business/ google-delays-areturn-to-the-of ce-until-september-1.5230839.
66. Laura A. Hambley, Thomas A. O’Neil, and Theresa
J. B. Klien, “Virtual Team Leadership: The Effects of
Leadership Style and Communication Medium on Team
Interaction Styles and Outcomes,” Or ga n iza tion a l
Beha vior a n d Hu ma n Decision Pr ocesses 103, no.
1 (May 2007): 1; Brian J. Galli, “An Evidence-Based
172
Model of Virtual Team Training and Development,”
In ter n a tion a l Jou r n a l of In for ma tion Techn ology Pr oject
Ma n a gemen t (IJITPM) 9, no. 2 (2018): 65–79.
67. Carol Kinsey Goman, “What We Lose In a Virtual
Workplace,” Forbes ( June 14, 2021).
68. Emily Douglas, “HR Analysis: How to Implement a
Successful WFH Model.”
69. Kathy Gurchiek, “Small Businesses Get Creative to
Survive During the Pandemic,” SHRM (September 19,
2020).
70. For a discussion of the stages of team development, see
Don Hellriegel and John W. Slocum, Jr., Or ga n iza tion a l
Beha vior, 11th ed. (Cincinnati, OH: South-Western,
2007).
71. Michelle Conlin, “Smashing the Clock,” Bu sin essweek
(December 11, 2006): 60. See also Susan Meisinger,
“Flexible Schedules Make Powerful Perks,” HR
Ma ga zin e 52, no. 4 (April 2007): 12; Esther Kadarko
Dizaho, Rohani Salleh, and Azrai Abdullah, “Achieveing
Work Life Balance Through Flexible Work Schedules
and Arrangements,” Globa l Bu sin ess & Ma n a gemen t
Resea rch 9 (2017).
72. Colin Butler, “Zorra Township’s 4-Day Work Week
Experiment Shows Early Signs of Promise,” CBC
(November 19, 2020), https:/ / www.cbc.ca/ news
/ canada/ london/ zorra-township-four-day-work
-week-1.5809038#:~:text=The%20four%2Dday%20
system%20used,as%20the%20compressed%20work%20
week&text=Zorra%20Township%20says%20early%20
results,no%20additional%20cost%20to%20taxpayers.
73. Kathy Gurchiek, “Good News for Moms Reconsidering
Work,” HR Ma ga zin e 51, no 7 (August 2006): 39;
Jay Love, “The Case for a Four Day Work Week,” In c
( January 11, 2012).
74. Jason Fried, “Be More Productive. Take Time Off,” The
New York Times (August 18, 2012).
75. Roma C. Paje, Paola Beatriz A. Escobar, Anna Monica
R. Ruaya, and Paula Andrea F. Sulit, “The Impact of
Compressed Workweek Arrangements on Job Stress,
Work-Life Balance, and Work Productivity of Rankand-File Employees from Different Industries in Metro
Manila,” Jou r n a l of Physics: Con feren ce Ser ies 1529, no.
3 (2020): 032055.
76. Rita Zeidner, “Bending with the Times,” HR Ma ga zin e
53, no. 7 ( July 2008): 10; Byron Y. Lee and Sanford E.
DeVoe, “Flextime and Pro tability,” In du str ia l Rela tion s:
A Jou r n a l of Econ omy a n d Society 51, no. 2 (2012):
298–316.
77. Mark Gollom, “Flexible Work Hours May Make for
Happier Workers, But They’re Not for Everyone,” CBC
(May 23, 2016), https:/ / www.cbc.ca/ news/ business
/ exible-work-hours-federal-employees-1.3589247.
78. OMERS, “Employer Administration Manual,” https
:/ / www.omers.com/ employer-administration-manual,
retrieved June 9, 2021.
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79. “Have You Con sid ered Job Sh arin g as a Reten tion
Tool?” HR Focu s 83, n o. 9 (Sep tember 2006): 10;
Mah ima Th akur, An jali Ban sal, an d Rash mi Main i,
“Job Sh arin g as a Tool for Flexible Work Systems,”
Gen d er in Ma n a gem en t: An In ter n a tion a l Jou r n a l
(2018).
88. Rachel Mosher Henke, Richele Benevent, Patricia
Schulte, Christine Rinehart, K. Andrew Crighton, and
Maureen Corcoran, “The Effects of Telecommuting
Intensity on Employee Health,” Amer ica n Jou r n a l of
Hea lth Pr omotion 30, no. 8 (2016): 604–12.
80. Angela Spencer, “Job Sharing: A Primer,” Jou r n a l of
Hospita l Libra r ia n ship 17, no. 1 (2017): 80–87.
90. Tammy D. Allen et al., “How Effective is Telecommuting?”
81. I. N. Mahmudova and N. V. Solovova, “Job-Sharing” As A
Form of Work Organization," in In ter n a tion a l Scien ti c
Con feren ce Fa r Ea st Con (ISCFEC 2018) (Dordrecht:
Atlantis Press, 2019): 360–63.
82. Md Badiuzzaman and Md Ra quzzaman, “Development
of ‘Virtual Of ce Model’ Software for Entrepreneur and
e-Management,” In ter n a tion a l Jou r n a l of In n ova tion ,
Ma n a gemen t a n d Techn ology 7, no. 2 (2016): 41.
83. Tammy D. Allen, Timothy D. Golden, and Kristen M.
Shockley, “How Effective is Telecommuting? Assessing
the Status of Our Scienti c Findings,” Psychologica l
Scien ce in the Pu blic In terest 16, no. 2 (2015): 40–68.
84. Tammy D. Allen et al., “How Effective is Telecommuting?”
85. Tammy D. Allen et al., “How Effective is Telecommuting?”
86. Glenn E. Dutcher, “The Effects of Telecommuting on
Productivity: An Experimental Examination. The Role of
Dull and Creative Tasks,” Jou r n a l of Econ omic Beha vior
& Or ga n iza tion 84, no. 1 (2012): 355–63.
87. Aline D. Masuda, Claudia Holtschlag, and Jessica
M. Nicklin, “Why the Availability of Telecommuting
Matters: Th e Effects of Telecommuting on Engagement
Via Goal Pursuit,” Ca r eer Developmen t In ter n a tion a l
(2017).
89. Tammy D. Allen et al., “How Effective is Telecommuting?”
91. Tammy D. Allen et al., “How Effective is Telecommuting?”
92. Tammy D. Allen et al., “How Effective is Telecommuting?”
93. Rachel Mosher Henke et al., “The Effects of
Telecommuting Intensity on Employee Health.”
94. Glenn E. Dutcher, “The Effects of Telecommuting on
Productivity.”
95. Aline D. Masuda et al., “Why the Availability of
Telecommuting Matters.”
96. Tammy D. Allen et al., “How Effective is Telecommuting?”
97. Wendell Joice, “Implementing Telework: The Technology
Issue,” Pu blic Ma n a ger 36, no. 2 (Summer 2007): 64;
Julianne Mahler, “The Telework Divide: Managerial and
Personnel Challenges of Telework,” Review of Pu blic
Person n el Admin istra tion 32, no. 4 (2012): 407–18.
98. Tammy D. Allen et al., “How Effective is
Telecommuting?”
99. Joseph Folkman, “Are Your Employees At Home
Actually Working?” Forbes ( July 7, 2020).
100. Marjorie Deruen, “The Remote Connection,” HR
Ma ga zin e 52, no. 3 (March 2007): 111; Julianne Mahler,
“The Telework Divide.”
101. Tammy D. Allen et al., “How Effective is Telecommuting?”
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The competition for top talent requires recruiting not only to look for talented
pools of employees but also to make an effort to gure out what they want and
establish the rm as an employer of choice so people will want to work for it.
And these efforts must be made within the context of the organization’s strategy.
In the past, recruiting was often a reactive process rms engaged in periodically when a position needed to be lled. Today, however, more companies see
the recruiting function as a strategic imperative and, therefore, an ongoing process. Instead of waiting for a job opening, HR managers are studying their rms’
strategies in conjunction with their organizational charts, job analysis information,
and external factors such as the labour market and the competition and then
recruiting proactively and continually.
The COVID-19 pandemic forced organizations to adapt to a virtual world
rapidly. At the pandemic’s start, recruitment slowed while organizations assumed a
“wait and see” approach.1 At the same time, external candidates were also less likely
to leave their organization because the future held many unknowns and moving
organizations would be considered a risky move.2 Eventually, as the world became
more adjusted to the “new normal,” recruitment slowly resumed. Recruiters began
reaching out to others to understand the evolving labour market and invested in a
signi cant amount of learning about talent advisory training, virtual interviewing,
productivity while working remotely, virtual onboarding and internal mobility.3
COVID-19 brought about a signi cant amount of recruitment process
changes. For example, internal mobility has increased 20 percent since the onset
of COVID-19. This nding is not surprising, given that many recruiting budgets
decreased.4 Recruiters also had to look for different skills. Organizations strategized on nding candidates that could t a work-from-home environment within
more exible or short-term roles. They intensi ed search efforts for candidates
who possessed purpose-driven and self-motivated qualities.5 According to a recent
survey, adaptability became the number one skill recruiters looked for in 2021.6
Recruitment became almost completely virtual. Thus, organizations were
required to think of new creative ways to interact with people virtually. “This
crisis has led us to reimagine recruiting,” stated Michael Wright, Global Head
of Talent Acquisition for media investment company GroupM, “We immediately
adapted our [arti cial intelligence]-driven video interview tools to be more empathetic and more contextually aware than they were pre-COVID. We’ve also set
up what we’re calling ‘video handshakes,’ which are more focused on discovering what people can be and become, rather than what they do and have done
[previously in their career.]”7 Experts predict that virtual recruitment will be a
more permanent staple in organizations, where the workforce will likely see a
hybrid version that combines both virtual and in-person processes.8
According to a survey of over 600 senior managers in Canada completed
during the outbreak of COVID-19, 75 percent of organizations participated in
remote interviews and onboarding sessions. In contrast, before the pandemic
only 12 percent of organizations conducted remote interviews and onboarding.
Fifty-eight percent of organizations had a shortened hiring process during the
pandemic, whereas only 15 percent had a shortened process pre-pandemic.
In the same study, it was also found that 57 percent of organizations advertised
fully remote jobs, whereas prior to the pandemic, only 16 percent did so. Further,
55 percent of organizations expanded their search geographically to look for
more candidates instead of 21 percent that had a large geographic pool before
the pandemic.9 This change, along with a growing recognition and emphasis on
diversity, can explain the increased focus on hiring people with diversity, equity,
and inclusion in mind.10 The study also found that 51 percent of individuals
increased the use of temporary professionals, whereas, before the pandemic, the
statistics found 16 percent used temporary professionals.11
In this chapter, we discuss the strategies and techniques organizations use both
internally and externally to recruit the talent they need. For example, to nd ways
to reach out to and recruit the right kinds of candidates, some companies develop
Chap t er 5: E x p a n d i n g t h e a lT e n t P o l : Re c r u i t m e n t a n d Ca r e r s
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employee pro les
Pro les of workers developed by studying
an organization’s top performers to recruit
similar types of people
em p loyee p ro les by surveying their top performers about what they like to do,
what events they attend, and how they like to be contacted and recruited. They
then pursue candidates using this information. We also discuss the approaches that
organizations take toward career management over time. This is important because,
unlike physical assets, human assets (employees) can decide to leave the rm of
their own accord.
Learning Outcome 1
St r a t e g ic A s p e c t s o f Re c r u it in g
Describe the relationship between a rm’s
strategy and recruitment.
Decisions about talent—regardless of whether they pertain to recruiting, transferring,
promoting, developing, or deploying people—need to be considered within the context of a business’s strategies and priorities.
The broad factors that can affect a rm’s recruiting strategy include a rm’s
recruiting abilities, whether to recruit externally or internally, the labour market
for the types of positions it is recruiting for, including global labour markets,
and the strength of a rm’s employment “brand.” We will talk about each of
these factors next. Note that at any given time, a rm might need to use multiple
recruiting strategies. Moreover, a strategy that works for one rm or one job
might not work for another rm (or job). For example, an engineering rm might
place a premium on nding highly quali ed applicants, whereas an amusement
park ramping up for a new season might place a premium on hiring quickly.
Recruiting strategies and their effectiveness can change over time as well. As a
result, rms need to continuously examine and re ne their recruiting efforts.
Attracting high-quality applicants is an essential aspect when considering
strategies for recruitment. Consequently, a plethora of research has explored
applicant attraction to determine what factors motivate or interest individuals to
pursue and accept a position within an organization. One research article that
analyzed results from 71 studies found that applicant attraction outcomes were
predicted by job-organization characteristics, recruiter behaviours, perceptions
of the recruiting process, perceived t, and hiring expectancies, but not recruiter
demographics or perceived alternatives.
Regarding job-organization traits, type of work and organization image were
the strongest predictors of an individual engaging in job pursuit. Surprisingly,
it was found that pay, compensation, and advancement predicted job pursuit
intentions much less than other job and organization characteristics. Regarding
recruiter characteristics, personableness was the stronger predictor of job pursuit
intentions and might offer information about the organization’s attractiveness
through a signal mechanism. Perceptions of the recruiting process that may hinder
interest in pursuing a job could include delays in responding to applicants or
using selection processes that results in negative reactions, among other negative
recruitment experiences. Evidence was also discovered that person–job t was a
stronger predictor of acceptance intentions than person–recruiter t. Finally, positive hiring expectancies were predicted to lead to greater applicant attraction.12
More recent studies have also looked at applicant attraction. They found various
factors relate to applicant attraction including organizational culture such as workplace fun 13 and an organization’s mission and values such as corporate social
responsibility (CSR), for applicants who had prior CSR education or those high in
other-regarding value orientation.14 Other research also reported that recruitment
strategies mattered, such as using websites rather than a printed advertisement or
multiple recruitment activities,15 among many different aspects to consider.
W h o Sh o u ld D o t h e Re c r u it in g ?
Most large rms have full-time, in-house HR recruiters. In smaller organizations,
the recruiting might be done by an HR generalist. If the organization has no HR
function, managers and/ or supervisors recruit their own employees.
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Organizations that want to focus on their core functions, including small
businesses that lack time or HR p ersonnel, sometimes outsource their recruiting
functions to outside rms. This p ractice is known as r ecr u itin g p r ocess
ou tsou r cin g (RP O). Organizations also sometimes use RPO providers when
they need to hire a lot of emp loyees or hire emp loyees quickly. RPO p roviders
can also be useful when a rm has had trouble nding suitable candidates in the
p ast or needs a different way to tap different talent p ools, p erhap s to nd more
diverse candidates.
recruiting process outsourcing
(RPO)
The practice of outsourcing an organization’s recruiting function to an outside rm
Sh o u ld a Fir m Re c r u it In t e r n a lly o r Ex t e r n a lly ?
Most managers try to follow a policy of lling job vacancies above the entry-level
position through promotions and transfers. By lling vacancies in this way, an
organization can capitalize on the investment it has made in recruiting, selecting,
training, and developing its current employees, who might look for jobs elsewhere if they lack promotion opportunities.
Promoting employees rewards them for past performance and encourages
them to continue their efforts. It also gives other employees a reason to believe
that if they perform similarly, they will be promoted too. This can improve
morale within the organization and support a culture of employee engagement.
Furthermore, the employee’s familiarity with the organization and its operations
can eliminate the orientation and training costs that recruitment from the outside would entail. Most important, the transferee’s performance record is likely
to be a more accurate predictor of the candidate’s success than the data gained
about outside applicants. Promotion-from-within policies at Keg Restaurants
and McDonald’s have contributed to the companies’ overall growth and success.
In fact, at McDonald’s, half of the franchisees and over two-thirds of top managers (including the last three Canadian presidents) rst started their careers
behind the counter.16
Managers need to be aware of the p otential limitations of recruiting internally as well, however. For examp le, jobs that require sp ecialized training and
exp erience cannot always be easily lled from within the organization and
may need to be lled from the outside. Th is is esp ecially common in small
organizations, where the existing talent p ool is limited. Potential candidates
from the outside should also be considered to p revent the “inbreeding” of
Rawpixel.com/ Shutterstock.com
Many companies use their own internal
intranet websites as well as the publicfacing website and other job-posting
websites to recruit candidates.
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ideas and attitudes. Chief executive of cers (CEOs) are often hired externally.
Ap p licants hired from the outside, p articularly for certain technical and managerial p ositions, can be a source of creativity and innovation and may bring
with them the latest knowledge acquired from their p revious emp loyers. It is
not uncommon for rms to attemp t to gain secrets from their comp etitors by
hiring away their emp loyees. Procter & Gamble (P&G) sued a rival p ap ermaker
when it hired former emp loyees who had a great deal of knowledge about the
making of Charmin toilet p ap er and Bounty p ap er towels—both P&G p roducts.
Amazon.com was sued by Walmart, which accused Amazon of hiring away
emp loyees who had in-dep th knowledge about Walmart’s sop histicated inventory systems. 17 Tesla Motors sued a former emp loyee for allegedly stealing
its self-driving car technology and trying to recruit dozens of the comp any’s
engineers for a startup rm. 18
Some applicants bring more than knowledge to their new employers. They
bring revenue. Talented salespeople, doctors, accountants, lawyers, and hairdressers are examples. When these people leave their organizations, their clients
often go with them. Recruiting externally in this case makes sense. Reaching
an employer’s diversity goals is another factor that can lead a rm to recruit
externally.
La b o ur M a rke ts
internal labour markets
Labour markets in which workers are hired
into entry-level jobs and higher levels are
lled from within
global sourcing
The business practice of searching for and
using goods and services from around the
world
The condition of the labour market can have a big effect on a rm’s recruiting
plans. During periods of high unemployment in the economy, organizations might
be able to maintain an adequate supply of quali ed applicants from unsolicited
résumés and from their in ter n al labou r m ark ets. Internal labour markets are
associated with “promotion within” policies where workers are hired into entrylevel jobs and higher levels are lled from within.19 A tight labour market, one with
low unemployment, might force the employer to advertise heavily and/ or seek
assistance from local employment agencies. Keep in mind that the actual labour
market a company faces depends on the industry in which the rm operates and
the types of positions it is seeking to ll. In one industry, the supply of quali ed
individuals might be plentiful for a particular position. Other jobs are chronically
hard to ll, such as the jobs for machinists, engineers, and IT professionals.
Re g io nal and Glo b al Lab o ur M arke ts
Have you ever noticed that competing rms are often located in the same areas?
Oil and gas companies are plentiful in the Calgary area. Film and television companies are clustered around Toronto and Vancouver. This is not a coincidence.
The clustering occurs because the resources these rms need—both human
and natural—are located in some areas and not others. Likewise, because the
University of Waterloo is one of the top computer science schools in the country,
high-tech companies have ocked to the city of Waterloo in Ontario. You could
open a high-tech rm in Churchill, Manitoba, but you might have a hard time
getting talent to relocate there.
In addition to locating near their talent, to stay apace of their competitors and
expand their operations around the world, companies are also looking globally
for goods and services, including labour. This practice is referred to as glob al
sou r cin g. As we explained earlier in this book, companies are no longer simply
offshoring work to save labour costs. They are also looking abroad to develop
better products around the clock via a global workforce and to attract the best
talent wherever it may be.
Firms are trying to ll not just technical p ositions but also lower-skilled
p ositions. Resorts and vacation areas are among the businesses having trouble
nding emp loyees to staff their op erations. Recruiting abroad can be very comp licated, however. In addition to having to deal with a myriad of local, national,
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and international laws, emp loyers also must take into account the different
labour costs, p reemp loyment and comp ensation p ractices, and cultural differences associated with the countries in which they are recruiting. In volatile
areas of the world, security is a concern.
B r a n d in g
Whomever and wherever a rm is recruiting, it wants to be the employer of choice
to attract and hire top candidates before its competitors do. Branding can help
organizations do this. Bran din g refers to a company’s efforts to help existing and
prospective workers understand why it is a desirable place to work. It aims attention at the organization as a “brand” to attract and retain top potential employees.
Employer branding highlights the unique features of the organization’s employment
offerings or environment.20 Recent research nds that employer branding orientation directly affects recruitment ef ciency.21 Consequently, some organizations
have incorporated employer branding as a signi cant component of their human
resources management strategy.22
Strategizing ways in which the organization can stand out beyond high salaries
and development opportunities is one of the most signi cant obstacles in employer
branding.23 So how does a company “burnish” its employment brand? One way is
to think of applicants as consumers and focus on what they want in terms of jobs
and careers as opposed to what an organization has to “sell” them. Companies
must listen to and reach out to applicants just like they do with consumers. In fact,
some rms make their customers their employees. A high percentage of the people
IKEA recruits are customers who like doing business with the company. By doing
so, organizations can develop a loyal group of employees who support the brand’s
image. Employees can play a signi cant part in corporate image formation outside
the work setting and “live the brand.”24 Consequently, these employees can assist
in future recruitment efforts. As research has found, potential candidates are more
attracted to an organization when information about the organization is conveyed
through word of mouth instead of online testimonials.25
Although word of mouth is the most effective, using social networks in employer
branding campaigns is advantageous in developing a good brand image.26 High
brand familiarity is an integral aspect of recruitment, and employers can do so by
developing a social media presence.27 Firms are creating pages on websites like
LinkedIn, Facebook, and Google+ to promote their organizations and careers they
have to offer. The sites allow recruiters to strike up conversations with potential
applicants on those pages and give them a preview of what it is like to work for their
rms. Employers can also monitor whether employees criticize the organizations
and can make necessary workplace changes or respond to criticisms on the social
networks to ensure future candidates receive positive insights into the company.28
Instead of just posting jobs on the Internet, rms are creating options on their
social media pages to promote the careers they have to offer, striking up conversations with potential applicants on those pages, and giving them a preview
of what it is like to work for their rms. Writing blogs and articles for industry
publications is another way. Organizations can discuss their own company and its
offerings, industry and sustainability issues, and corporate citizenship matters. The
organization’s values, goals, and strategy should also be communicated. Potential
candidates can use this data in the course of their job search process.29 (We will
talk more about social networks as a recruiting tool later in the chapter.)
Using the Internet and social networks is an inexpensive way to brand and
recruit. The strategy can be particularly effective for small companies that can’t
afford to pay for a lot of job advertising to promote their rms and attract candidates.
They can use social media tools—Facebook, LinkedIn, YouTube, Twitter, Tumblr,
Pinterest, Vimeo, and TikTok—to post photos and videos about their employees,
services, and products and to make announcements about specials, contests, and
job openings. This can make it easy to recruit great employees.
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branding
Acompany’s efforts to help existing and
prospective workers understand why it is a
desirable place to work
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Online games are a good branding and recruiting tool as well. Barclays
Investment Bank has a free online stock-trading game that uses real-time
market data. More than 4,500 people—mostly college students—have played the
game, and about 8 percent of them have applied for jobs with the company.30
Organizations can reach a larger number of candidates that far exceed the college
campus visit approach would.31 A game can also become an easy way for an
organization to place itself in a favorable light and attract candidates that may not
have traditionally contemplated pursuing that industry.32 For example, Siemens,
the industrial manufacturer, created an online interactive game named Plantville
that gets players to manage a virtual factory to test college graduates’ abilities
and motivate these graduates to see factory management positions in a more
favourable light. American military organizations also use gaming platforms to
improve enlistment and offer a forum for promotional information.33
Philanthropic activities are another avenue for reaching out to prospective
employees, especially Generation Z and millennial applicants, who are looking
for more than just a paycheque and promotions in their careers. One study of
employee preferences found that around 50 percent of the respondents were
willing to take a 15-percent pay cut to work for environmentally and socially
responsible employers. More recent research on employer branding and CSR
found that an organization’s environmental engagement also positively impacts
employer attractiveness.34 To establish relationships with promising young
employees, the accounting and consulting rm Deloitte has teamed up with
United Way Worldwide to sponsor alternative spring-break programs for undergraduate students who work alongside employees to help communities in need.
As another example, footwear retailer Aldo emphasizes employer branding by
carefully considering the store environment, whether the location, store layout,
the music and lighting within the stores, product merchandising, and customer
service. However, Aldo also developed its brand image by becoming climate neutral and offsetting all carbon emissions produced in 2017 by its corporate stores,
of ces, and distribution centres.35
In the global arena, branding can be enormously helpful because locals are
often unfamiliar with foreign rms. In India, the rms people work for are very
important to applicants and their families. Genpact has set up “storefronts” in
major Indian cities to promote the employment brands of its corporate clients.
Candidates can walk in and chat with company representatives about what these
rms do and the kinds of opportunities they offer. Cultural differences between
geographies should be kept in mind when planning global communication.36
The visual display of recruitment advertisements is also essential in branding.
An organization’s logo offers a starting point for the recruitment process.37 The
Central Intelligence Agency (CIA) recently rebranded by replacing the “patriotic”
eagle, compass, and scroll with a sleeker and more dramatic dark logo. This
change was signi cant as it moved away from the traditional crests and seals
typically used in similar services. This change is said to attract a wider breadth
of candidates, including more diverse candidates that had once typically been
excluded, such as women and minority groups. This change is also apparent on
the CIA’s new website, highlighting more diverse individuals in the photos.38
Firms need to be sure that the brand they promote to prospective employees
truly re ects their internal cultures, however. Painting a rosier picture of your
organization can back re because it can leave applicants disillusioned after they
have been hired. (To help prevent this from occurring, some rms use realistic job
previews, which are discussed later in this chapter.) Further, a high degree of positive organizational branding will bring about a larger group of applicants, many
of which will not be suitable and do not meet the prerequisites for the available
jobs.39 Therefore, organizations with successful branding will also need to consider
strategies for pre-screening and selection. Highlights in HRM 5.1 shows how the
hotel chain Marriott has been able to establish its brand as an employer of choice
by engaging in good recruiting practices. The brand re ects Marriott’s culture.
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Highlights in HRM 5.1
M arrio tt’s Re c ruitm e nt Princ ip le s: Living Up to the Em p lo ym e nt B rand
1. Build the employment brand. Marriott attracts employees
the same way it attracts customers. Just as consumers
buy experiences, not just products, potential employees
are looking for a great work experience when they shop for
jobs. Communicating the promise of a great work experience is what employment branding is all about. It is basically a value proposition. According to CEOJ. W. Marriott,
“For more than 70 years, we’ve lived by a simple motto:
If we take care of our associates, they’ll take care of our
guests. That isn’t just a sentiment. It is a strategy—one all
businesses must adopt to remain competitive in an environment where our most valuable resource, human capital,
drives economic value for our company.”
welcome. Committed associates are less likely to leave,
and associate work commitment is one of the key
drivers of guest satisfaction. Managers are accountable
for associate satisfaction ratings and for turnover rates.
Every day, associates in each of Marriott’s full-service
hotels participate in a 15-minute meeting to review
basic values, such as respect and harmony. Managers
also encourage associates to raise their personal concerns. They take the time to celebrate birthdays and
anniversaries. Marriott calls this the loyalty program
because it builds loyalty among associates and repeat
business from customers. The result is that everyone
has a stake in making the hotel a success.
2. Get it right the rst time. Marriott “hires friendly” and “trains
technical.” It is better to hire people with “the spirit to serve”
and train them to work than hire people who know business and try to teach them to enjoy serving guests. Marriott
hires cooks who love to cook and housekeepers who love to
clean. They have learned that this approach works for both
delivering excellent service and retaining their employees.
5. Promote from within. More than 50 percent of
Marriott’s current managers have been promoted
from within. All associates are given the opportunity
to advance as far as their abilities will carry them.
Elevating veterans to positions of leadership helps
Marriott pass on the soul of its business—its corporate
culture—from one generation to the next. In addition,
promoting from within is a powerful tool for recruitment
and retention. Associates cite “opportunity for advancement” as a key factor in their decisions to stay with
Marriott. (Accompanying that is a $100-million-a-year
commitment to training.)
3. Money matters, but so do other factors. The top concern
of Marriott associates is total compensation. But intangible
factors taken together, such as work–life balance, leadership quality, opportunity for advancement, work environment, career growth, and training, far outweigh money in
their decisions to stay or leave. Pay matters less, and the
other factors matter more the longer someone works for
Marriott. From exible schedules to tailored bene t packages and development opportunities, Marriott has built
systems to address these nonmonetary factors.
4. A caring workplace is a bottom-line issue. When
employees come to work, they feel safe, secure, and
6. Employment brand. Employment branding entails
creating a good work experience for employees. J.W.
Marriott, the CEOstates, “Since 70 years, we work with a
single motto: Take care of your employees and they will
take care of your guests. This strategy should be adopted
by all the businesses to stay at the top in a world where
human capital is the most important resource.”
Sources: J. W. Marriott, “Competitive Strength,” Executive Excellence 18, no. 4 (April 2001): 3–4; J. W. Marriott, “Our Competitive Strength: Human Capital,”
Executive Speeches 15, no. 5 (April/May 2001): 18–21; “Why Marriott Is a Social Media Recruiting Superstar,” Brandemix, https://www.brandemix.com/whymarriott-is-a-social-media-recruiting-superstar/, retrieved April 24, 2018; Anna Verasai, “Recruitment Principles of Marriott,” The HR Digest (January 13, 2016).
Check In
Think about your experience being recruited or, if you were working for an employer, the organization’s
recruitment efforts during the pandemic. What was different? Were you comfortable with the changes?
How would you improve on the recruitment processes involved?
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Learning Outcome 2
Describe the methods by which rms recruit
internally.
Re c r u it m e n t C h a n n e ls
Re c r u it in g In t e r n a lly
It is only natural for a rm to look internally rst when it needs talent. Internal
candidates are readily available and get up to speed faster, and there is less
uncertainty about how they will perform. You also do not have to run advertisements to nd them, which can be costly.
Inte rnal Jo b Po sting s
Internal job postings are a quick way to nd quali ed employees interested in a
position. A small business might simply post a notice on a bulletin board in its
break room. Larger companies generally post their openings on their intranet
sites. The intranets of some companies alert employees about jobs in which they
may be interested. As a position becomes available, a list of employees interested
in that position is retrieved, and the records of these employees are reviewed
to select possible candidates for interviews. The employees can be electronically noti ed about interview schedules and track their progress electronically
through the various hiring stages.
Id e ntifying Tale nt thro ug h Pe rfo rm anc e Ap p raisals
9-box grid
Acomparative diagram that includes
appraisal and assessment data to allow
managers to easily see an employee’s
actual and potential performance
Successful performers are often good candidates for a promotion. Identifying and
developing all employees is a role that all managers should take seriously. A tool
called a 9-b ox g r id is helping rms such as General Electric (GE), Novartis, and
others do this. The grid helps managers assess appraisal and assessment data to
be compiled into a single visual reference so they can see an employee’s both
actual performance and potential performance. This can then help managers
determine what the developmental needs of the employee are and what the person’s next steps within the organization might be. Figure 5.1 is an example of a
9-box grid.
F ig u r e 5 .1
High
Capacity and/or capability for
progression after further
potential has been released
Capacity and/or ability for
immediate advancement
clear potential beyond current
role
Medium
Potential
Novice showing high
potential/has
demonstrated high
potential in previous roles
Novice new in company/role.
Test in role. Has potential to
improve performance
Developer may have potential
to do more through lateral
move/bigger responsibility.
Needs to be tested to ensure
capability is maximized
High performer, ready for
additional challenge. Potential to
perform in another role at same
level (transferable skills)
Low
An Exam p le o f a 9 - B o x Grid
Risk performance issues
Highly valued possibly a
specialist
High performer, hard to
replace, possibly a specialist
Below Target
On Target
Above Target
Performance
Source: Mike Morrison RapidBI.com.
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Skill Inve nto rie s and Re p lac e m e nt Charts
As we discussed in Chapter 2, rms use skill inventories to help track an employee’s
education, past work experience, vocational interests, speci c abilities and skills,
compensation history, and job tenure to see how they can best be used. P&G and
HSBC are among the rms that track their employees this way to locate capable
employees who can be recruited to ll open positions. Along with skill inventories,
replacement charts are an important tool for succession planning. At GE, for every
position at or above a director level, two or three people are usually identi ed who
can easily step in when the current jobholder moves on.40
As we also discussed in Chapter 2, more rms are electronically capturing the
quali cations of each of their employees. Companies such as PeopleSoft and SAP
have been developing automated staf ng and skills management software. These
information systems allow an organization to rapidly screen its entire workforce
to locate suitable candidates to ll an internal opening. The data can also be used
to predict the career paths of employees and to anticipate when and where
promotion opportunities might arise.41
Research has found that managers often hire external candidates rather than promote their current employees because they tend to overvalue unfamiliar candidates
and undervalue known ones.42 This tendency can leave a rm’s current employees
disillusioned to the point where they begin looking elsewhere for jobs, even when
the external candidates hired end up being very quali ed for their positions. When
experienced employees leave an organization, they take with them years of corporate know-how that is hard to replace. Some signs that the rm needs to work harder
at grooming internal talent are shown in Figure 5.2. To lessen the chances of losing
top performers, some managers actively identify high-potential “at-risk” employees
and take steps to retain these people.
Check In
Sometimes rms do not post openings for which anyone may apply. Instead, they select someone
to promote. Why might a rm do this, and what drawbacks could result?
Re c r u it in g Ex t e r n a lly
Learning Outcome 3
The sources from which employers recruit externally will vary with the type of
position to be lled. Some rms keep detailed statistics by job type on the sources
from which their employees are hired. This helps HR managers make better decisions about the places to begin recruiting when different job openings arise.
Describe the methods by which rms recruit
externally.
Ad ve rtise m e nts
Advertising job openings on websites and in newspapers and trade journals is a
common way to attract candidates. But help wanted signs, billboards, and even
Craigslist are sometimes used. In countries in which literacy rates are low, radio
F ig u r e 5 .2
W arning Sig ns o f a W e ak Tale nt B e nc h
1. It takes a long time to ll key positions.
2. Key positions can be lled only by hiring from the outside.
4. Replacements for positions often are unsuccessful in
performing their new duties.
3. Vacancies in key positions cannot be lled with con dence in
the abilities of those chosen for them.
5. Promotions are made on the basis of whim, favouritism,
or nepotism.
Source: Adapted fromWilliam Rothwell, Effective Succession Planning (New York: AMACOM, 2000).
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and television ads can be more effective. Ads and pages on social networking
sites, email campaigns, Twitter, and text messages are new ways recruiters are
getting the word out about job openings.
Advertising has the advantage of reaching a large audience of possible applicants. However, some degree of selectivity can be achieved by using newspapers
and journals directed toward a particular group of readers. Professional and
trade journals, blogs, the professional social networking groups on LinkedIn, and
the publications of unions and various fraternal or nonpro t organizations will
attract different types of candidates than help wanted signs, for example.
Preparing recruiting advertisements not only is time consuming, but also
requires creativity in terms of developing their design and message content.
Well-written advertisements highlight the major assets of the position while
showing the responsiveness of the organization to the job, career, and lifestyle
needs of applicants. Also, there appears to be a correlation between the accuracy
and completeness of information provided in job advertisements and an organization’s recruitment success. The more information disclosed, the better. Among the
information typically included in advertisements is that the recruiting organization is an equal opportunity employer.
However, even when a job op ening is described thoroughly in an
advertisement, many unquali ed ap p licants will still ap p ly. HR p ersonnel often
have to sift through stacks of inquiries and résumés to locate quali ed candidates. In fact, for each vacant corp orate p osition, on average HR staff receive
250 résumés. 43 Fortunately, there are tools comp anies can use to p rescreen
ap p licants online. AI can help p rescreen ap p licants with automated video
interviews and have candidates p articip ate in activities that analyze their cognitive abilities and decision-making styles to nd the best match for the organization. 44 Technology can also review résumés, integrate p rescreening interview
resp onses, and p erform p sychometric p ro ling assessments. Th e technology
asks questions and evaluates resp onses to come to an educated assessment of
the candidate. 45
W alk- Ins and Unso lic ite d Ap p lic atio ns and Ré sum é s
Walk-in job seekers looking for jobs that pay hourly wages are common in
smaller organizations. Employers also receive unsolicited applications and
résumés. Walk-in applicants and individuals who send unsolicited résumés to
rms may or may not be good prospects for employment. However, they are a
source that cannot be ignored. In fact, it is often believed that individuals who
contact employers on their own initiative will be better employees than those
recruited through college placement services or newspaper advertisements.
Good public relations dictate that any person contacting an organization for
a job be treated with courtesy and respect. Not treating applicants with respect
will harm a company’s employer brand. If there is no present or future possibility
of employment in the organization, the applicant should be tactfully and frankly
informed. Research has found that over half of candidates were either likely or
very likely to tell other people about their applicant experiences. Further, candidates are now using online platforms, such as social media sites, to spread
awareness about their experiences. In this respect, 31 percent of individuals said
they would post if they had a positive experience, and 20.2 percent would share
a negative experience online.46
The Inte rne t, So c ial N e tw o rking , and M o b ile Re c ruiting
Looking on the Internet is the most commonly used search tactic by job seekers
and recruiters to get the word out about new positions. Both companies and
applicants nd the approach cheaper, faster, and potentially more effective.
There are thousands of independent job boards online. Among the most widely
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Bloomberg/ Bloomberg/ Getty Images
In some segments, such as retail stores
and restaurants, it is quite common to
nd excellent prospective employees
through walk-in applications.
used job boards are Monster, Workopolis, CareerBuilder, Indeed, Google for Jobs,
and Glassdoor. Recruiters can place ads on these sites and use keywords to
search for applicants on them. Those looking for HRM jobs can also search these
sites, as well as the company websites, directly. Monster has a premium service
that narrows down applicants, ranks candidates, and compares them side by
side. Staf ng experts say it is also a good idea to post your rm’s jobs at free
association and trade group sites, where your speci c talent pool is most likely
to congregate. Of course, most large companies post job openings on their own
corporate websites, usually under a link titled “Careers.” Some companies are
now posting podcasts that pro le the working lives of their different employees.
Other companies are taking Internet recruiting to a whole new level. Instead
of recruiters trying to gure out where to place individual ads and when to take
them down, they are using big data, robots, and software to do the job. Appcast
is software that trawls the Internet looking for candidates who are well suited
for positions based on the interests they express, where they go on the Web,
and whether or not they appear to be looking for jobs. Job ads then appear
on their screens—just like ads for products do when you are shopping online.
The software recruiting company FirstJob has developed a chatbot named “Mya”
to help recruit candidates for jobs. Mya converses with candidates online to
encourage them to apply—or not to apply—for certain jobs, reviews their applications, and can even schedule interviews with them, among other things.47
As we indicated earlier in the chapter, to help establish their employer brands
and recruit talent, many companies are making use of social networking tools to
recruit employees. Recruiters are joining groups on LinkedIn that target certain
types of professionals. And, of course, companies are ocking to Facebook, for
example, to create free recruiting sites where recruiters post job information,
showcase their company’s attractive features, offer job advice, and post company
news. The organizations then buy advertisements on Facebook directing potential candidates to their sites.
Social media websites are increasingly used by organizations to create
company pages, post and advertise jobs, showcase their company’s attractive
features, and join groups that target certain types of professionals. Potential
applicants can then “follow” companies they are interested in working for. By
using social media, recruiters at UPS say they were able to access a new applicant pool—namely, millennials—and signi cantly increase the number of them
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passive job seekers
People who are not looking for jobs but
could be persuaded to take new ones given
the right opportunity
mobile recruiting
The process of recruiting candidates via
their mobile devices
applying with the company. UPS engaged them in conversations with other UPS
employees and unscripted “day in the life” videos of employees and interviews
with senior managers explaining how they rst started with the company and
possible career paths.48
Software developers, such as TalentBin and ZoomInfo, have created talent
search software, which can be customized to search the Web for valuable but
passive job candidates, based on information they post on industry blogs, social
networking sites, and so forth. Passive job seek er s are people who are not
looking for jobs but could be persuaded to take new ones given the right opportunity. Facebook has made it easier to nd passive job seekers, as well. Recruiters
can create job postings targeted at certain types of people’s newsfeeds and
contact them via Messenger if they want. Those who are interested in the job can
simply click on the “Apply Now” button, and their applications are automatically
populated with information from their Facebook pro les.49
Mob ile r ecr u itin g has given creative recruiters another new tool to use
in the war for talent. Mobile recruiting is the process of recruiting candidates
via their mobile devices. It is no secret that people are glued to their mobile
phones these days. For this reason, recruiting experts advise that whatever social
networking or Internet platform an organization uses, it should have a mobile
application tied to it.
Text messages are also being used to send prospective employees’ information about jobs. Some surveys show that it is the most popular type of e-recruiting,
perhaps because people know how to use it the best. Text messages work well
because they are inexpensive, easy to send, fast, and work with any cell phone.
Moreover, because most people have their mobile devices on all the time, they
get the messages immediately instead of having to launch applications on their
phones to get to a site such as Facebook or LinkedIn.
Using social networks is an inexpensive way to recruit people compared to
print ads, which can cost hundreds of dollars to run. But there can still be costs a
recruiter might not necessarily think about. Patrice Rice, the president of Patrice
and Associates Inc., a hospitality industry recruiter, gures that in one year alone
she spent $60,000 on branding, a Facebook campaign, and employing a parttime social media manager to maintain the company’s online presence, partly
so recruiters didn’t have to, but also to be quicker to respond to queries from
potential candidates.50
Another potential drawback of using social media, such as Facebook, Twitter,
and the Internet in general, is that some groups of people are less likely to be
“wired.” People with disabilities are an example. A 2010 study found that whereas
85 percent of adults without disabilities access the Internet, only 54 percent of adults
with disabilities do. As a result, relying too heavily on electronic recruiting could hurt
a company’s diversity efforts. And despite the fact that social media is a burgeoning
way to recruit employees, some surveys show that the number of employees hired
via social media recruiting is still relatively small compared to other methods.
Jo b Fairs
Job fairs can be a good way to cast a wide net for diverse applicants in a certain
region. At a job fair, companies and their recruiters set up booths, meet with
prospective applicants, and exchange employment information. Often the fairs
are industry speci c.
One drawback of job fairs is that although they attract a lot of applicants,
many of them might not be quali ed. Another problem is that they only attract
applicants in the regional area in which they are held. One way to get around
the latter problem is to hold a “virtual job fair” that anyone, anywhere can attend.
During a virtual job fair, recruiters staff “virtual booths” online, where they
provide links to their career resources, collect résumés, and talk with candidates
via online chat functions.
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Em p lo ye e Re fe rrals
The recruitment efforts of an organization can be greatly aided by employee referrals
or recommendations from the rm’s current employees about potential candidates.
In fact, word-of-mouth recommendations are the way most job positions are lled.
(Apparently, there is truth to the phrase, “It is not what you know, but who you
know.”) Managers have found that the quality of employee-referred applicants is
normally quite high because employees are generally hesitant to recommend individuals who might not perform well. In general, applicants who are referred by a
current employee, if hired, tend to remain with the organization longer as well.51
Some rms have created referral pages on their intranets to make it easier
for employees to refer candidates and track their progress through the hiring
process.52 Accenture is a company that has such a site. Highlights in HRM 5.2
shows some additional ways rms can encourage employee referrals.
Highlights in HRM 5.2
Em p lo ye e Re fe rral Pro g ram s That W o rk
A company’s current employees may be its greatest source of
future employees thanks to a well-designed and well-promoted
employee referral program (ERP). Here are several suggestions
for creating an effective program:
●
●
●
Determine the strategic goals and anticipated outcomes
of the employee referral program. At the outset, organizations should ascertain their intentions in establishing
an employee referral program. What are the short-term
and long-term strategic goals of an employee referral
program? Pinpointing the strategic goals and foreseen
consequences of the program from the beginning
will set the foundation as the program is created and
will assist in amassing senior leader support for the
program.
Design the process and participation rules. Employee
referral programs should be constructed to be speedy,
precise and user friendly. The organization should rst
create a standard form for the employee making the
referral to submit. The form should ask for suf cient
information to single out the employee, the referral
candidate and potential positions which may t the
candidate. If the organization has further questions for
the employee, they should contact the employee later.
The objective is to be provided with the referral as
ef ciently as possible.
types of candidates will enhance the overall team also
adds to their enthusiasm for the program.
●
●
●
Make the ERPpart of the company culture. Companies
typically need more of certain types of skills than others
and often have a general pro le of background, education,
values, and ethics in mind for their candidates. So a big
part of building an effective referral program is educating
employees about the kinds of people the organization
wants to hire—and continuing to keep that pro le in the
forefront. Helping employees see how nding the right
●
Be responsive. Failing to acknowledge referrals promptly
makes employees feel as if their efforts have disappeared
into a black hole, which is demotivating. Instead, let the
candidate and the referring employee know right away
when a referral has entered the system. Then give the
referred candidate priority processing in terms of screening
and interviewing to demonstrate how much good referrals
are valued.
Up the ante. Consider creating two tiers of nancial
incentives for referrals: small rewards for candidates who
meet the company’s requirements but are not selected and
larger rewards for successful matches.
Build in features to maximize referrals. Consistently accept
referrals, even without an open position. The preferred
candidate should be made aware if there is no open
vacancy and told that their résumé would be on le for a
set period. This strategy might be especially bene cial for
hard-to- ll positions. Ensure transparency with referees
on the situation as it pertains to the referrals. Offering
feedback to the referees is also helpful in improving
their ability to provide referrals in the future. Ensure
communication is ef cient and timely. The process
for recruitment should also be sped up with referred
candidates, but they should remain evaluated with the
same criteria as non-referred candidates.
Provide rewards that employees value. Some companies
offer healthy bonuses, all-expenses-paid weekend trips,
donations to the referring employee’s favourite charity, or
free insurance as incentives for successful referrals, but
plenty of other options are available. Other rewards may
include an extra day off with pay, points that go toward a
(Continued )
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prize or a raf e, or other gifts, gift cards, or other bonuses.
Many experts agree that public recognition, perhaps at a
company meeting or department luncheon, can be equally
rewarding.
●
Give employees the right tools. Consider supplying
employees with special “we’re recruiting” business cards
to hand out when meeting people face-to-face. And
make it easy for employees to post or tweet information
about job openings to their online network of associates.
An employee referral program will only be successful if
employees understand their organization has a referral
program. Therefore, HR professionals should develop a
communication plan for employees to be made aware of
the program.
●
Measure results. It should go without saying that after the
program is implemented, managers need to study the results
in terms of the volume of referrals versus other recruiting
methods, quali cations of candidates, workforce participation rate, and success and retention of new hires on the job.
These results can then be used to ne-tune the program.
Sources: “How a Talent Management Plan Can Anchor Your Company’s Future,” HRFocus 81, no. 10 (October 2004): 7–10; Susan M. Heath eld, “You Can
Inspire Great Employee Referrals,” http://humanresources.about.com; John Sullivan, “Advanced Employee Referral Programs—Best Practices You Need to
Copy,” www. rjohnsullivan.com; Emre Ekinci, “Employee Referrals as a Screening Device,” Rand Journal of Economics 47, no. 3 (August, 2016): 688–708; SHRM,
“Designing and Measuring Successful Employee Referral Programs.”
nepotism
Apreference for hiring relatives of current
employees
rerecruiting
The process of keeping track of and
maintaining relationships with former
employees to see if they would be willing to
return to the rm
There are some negative factors associated with employee referrals and
pro les, however, including the possibility of corporate “inbreeding.” Because
employees and their referrals tend to have similar backgrounds, employers
who rely heavily on employee referrals to ll job openings may intentionally or
unintentionally screen out, and thereby discriminate against, protected classes.
Some researchers have found that inbreeding occurs gradually as part of a threestage trend. According to the Attraction-Selection-Attrition model, in the rst stage
(Attraction), people with values similar to those of an organization are attracted to
it and become employees. In the second stage (Selection), these employees then
choose applicants similar to themselves. In the nal stage (Attrition), employees
who do not t in leave. The result is an organization that thinks alike, acts alike,
and maybe looks alike.53
The practice of hiring relatives, referred to as n ep otism , can invite charges
of favouritism, especially in appointments to desirable positions. HR personnel
hiring globally, however, need to realize that in other cultures, including Asia and
the Middle East, nepotism is the norm.
Re re c ruiting
Rer ecr u itin g is the process of keeping track of and maintaining relationships
with former employees to see if they would be willing to return to the rm.
Rerecruiting is not uncommon. At the accounting and consulting rm Deloitte,
over 75,000 former employees are kept track of via an “alumni network.” Other
organizations that have alumni networks include Microsoft, Oshkosh, and Ernst
& Young.54
Exe c utive Se arc h Firm s
In contrast to public and private employment agencies, which help job seekers nd
the right job, executive search rms (often called “headhunters”) help employers
nd the right person for a job.
The fees charged by search rms can range anywhere from 25 to 40 percent
of the annual salary for the position to be lled. For the recruitment of senior
executives, this fee is paid by the client rm, whether or not the recruiting effort
results in a hire. Nevertheless, as we noted earlier, hiring new CEOs from outside
the organization has become commonplace. However, newer data suggest that
CEOs who are promoted from within their organizations outperform those hired
from the outside.
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Ed uc atio nal Institutio ns
Educational institutions typically are a source of young applicants with formal
training but relatively little full-time work experience. High schools are usually
a source of employees for clerical and blue-collar jobs. Community colleges,
with their various types of specialized training, can provide candidates for technical jobs. These institutions can also be a source of applicants for a variety of
white-collar jobs, including those in the sales and retail elds. Some management
trainee jobs are also staffed from this source.
For technical and managerial positions, colleges and universities are generally
the primary source. Given these numbers and the strong demand for highly skilled
employees, universities and colleges are likely to remain a good recruiting source.
In addition, some Canadian universities are setting up campuses overseas. As a
result, HR professionals in the coming years will have a new source from which to
recruit employees abroad.55
Not using campus placement of ces effectively and trying to visit too many
campuses instead of concentrating on select institutions are common mistakes
rms make when recruiting on campus. Rather than recruiting students from
dozens of schools, as they have done in the past, companies such as Nestlé are targeting fewer schools and forming closer partnerships with them. Employees guest
lecture at the schools and develop relationships with instructors, who then recommend students for jobs. (Yes, it pays to be nice to your teacher!) Another mistake
recruiting rms make is not continuing the recruiting effort on a long-term basis
once it is begun.
Furthermore, some recruiters sent to campuses are not suf ciently trained or
prepared to talk to interested candidates about career opportunities or the requirements of speci c openings or do not follow up with them. This is a grave mistake
because research shows that students’ perceptions of recruiters have a big impact
on which jobs and companies they choose to pursue. “It is all about how [students]
are treated in the campus recruiting process and the feeling that they get from the
people they interact with,” says the founder of a college recruitment consulting rm.
To attract high-demand graduates, in addition to offering higher pay, rms
sometimes employ innovative recruitment techniques such as work–study programs,
low-interest loans for promising recruits, scholarships, and internships. Internships
can be a great way for rms to “try out” students who want to work in their elds
and for students to decide if they want to work for an organization long term.
However, many internships are not as successful as they should be because the
sponsoring rms have not thought through how to effectively use their interns. This
can lead to bored interns, who can, in turn, become disillusioned about their elds.
Pro fe ssio nal Asso c iatio ns
Many professional associations and societies offer a placement service to members
as one of their bene ts. Lists of members seeking employment may be advertised in their journals or publicized at their national meetings. For the mutual
bene t of employers and job seekers, placement centres are usually included
at the national meetings of professional associations. The Human Resource
Professionals Association (HRPA), for example, helps employers and prospective
HR employees come together.
Lab o ur Unio ns
Labour unions have been a principal source of applicants for blue-collar and
some professional jobs. Some unions, such as those in the maritime, printing, and
construction industries, maintain hiring halls that can provide a supply of applicants, particularly for short-term needs. Employers wishing to use this recruitment source should contact the local union under consideration for employer
eligibility requirements and applicant availability.
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Highlights in HRM 5.3
M aking Yo ur Inte rnship Pro g ram a Suc c e ss
Let’s assume your company’s management has realized
that internships bene t both your rm and the students they
employ. And let’s assume management understands that,
statistically, interns usually make the best future full- edged
employees. So now let’s look at how to make your internship
program a success. Experts agree that you should do the
following:
●
●
Reach out to colleges and universities to begin building
relationships with them. Let the career advisors at these
schools know what you are looking for and what you have
to offer the interns and continue to promote your program
on an ongoing basis.
Clearly de ne what you are looking for in a candidate in
terms of current enrollment, GPA, preferred or required
major, speci c skills, attributes, and other experience.
●
●
●
●
Devise a budget for intern recruiting, selection,
compensation, relocation, housing, and travel.
For each intern position, develop a work plan—a list of
responsibilities and tasks that will be performed by this
person. Because the intern will probably be assigned to a
supervisor who will serve as the intern’s mentor, it might be
useful to get input from the supervisor regarding the position.
Write an internship handbook that includes information
on intern orientation, mentoring, executive engagement,
project work, and cross-functional activity opportunities.
Provide this to all the supervisor/mentors in the program
and the interns.
Set up a system for providing interns with feedback
on their performance, preferably at the midpoint of
their internship and again at the conclusion. Make the
experience a teachable moment.
Sources: “Getting the Most from Internship Programs,” Supply Chain Management Review 13, no. 8 (2009): 34; Audrey Watters, “5 Tips for Creating an Internship
Program for Your Startup,” www.readwriteweb.com; Jean Scheid, “Designing Internship Programs,” www.brighthub.com; Penny Loretto, “Developing an Internship
Program,” http://internships.about.com.
Pub lic Em p lo ym e nt Ag e nc ie s
Each province maintains an employment agency that administers its employment
insurance program. Many of these agencies bear such titles as Human Resources
Development or Employment and Social Development and have local public
employment of ces in most communities of any size. Individuals who become
unemployed must register at one of these of ces and be available for “suitable
employment” to receive their weekly employment insurance cheques. In addition
to matching unemployed applicants with job openings, public employment agencies sometimes assist employers with apprenticeship programs, employment
testing, job analysis, evaluation programs, and community wage surveys.
Private Em p lo ym e nt and Te m p o rary Ag e nc ie s
Charging a fee enables private employment agencies to tailor their services to the
speci c needs of their clients. However, it is common for agencies to specialize in
serving a speci c occupational area or geographic area. When recruiting abroad,
companies frequently use local employment agencies because they understand a
country’s culture, labour markets, and methods of recruiting workers there.
Depending on who is receiving the most service, the fee may be paid by the
employer, the job seeker, or both. It is not uncommon for private employment
agencies to charge an employer a 25 to 30 percent fee, based on the position’s
annual salary, if the employer hires an applicant found by the agency.
Private employment agencies differ in the services they offer, their professionalism, and the calibre of their counsellors. If counsellors are paid on a
commission basis, their desire to do a professional job may be offset by their
desire to earn a commission. Thus, they may encourage job seekers to accept jobs
for which they are not suited.
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In addition to placing permanent workers, many private agencies hire and
place workers in temporary positions. “Temps” are typically used for short-term
assignments or to help when managers cannot justify hiring a full-time employee,
such as for vacation ll-ins, for peak work periods, or during an employee’s
pregnancy leave or sick leave. Increasingly, temps have been employed to ll
positions once staffed by permanent employees.
Temps give organizations added exibility because they can be hired and laid
off as needed. Also, the employment costs of temporaries are often lower than
those of permanent employees because temps are not provided with bene ts.
To keep their costs down and gain exibility, some companies use a just-in-time
staf ng approach, in which a core staff of employees is augmented by a trained
and highly skilled supplementary workforce.
Many temporary employees are eventually hired full-time. Temping allows
them and the rms they contract with to try one another out before a permanent
commitment is made. One concern related to using temps is that they have less
of an incentive to be loyal to an employer and its clients or to go the extra mile
to help a company achieve success.
Em p lo ye e Le asing
Em p loyee leasin g by p rofessional emp loyer organizations (PEOs) has grown
rap idly in the United States but is not as common in Canada. Basically, a PEO—
typ ically a larger comp any—takes over the management of a smaller comp any’s
HR tasks and becomes a coemp loyer to its emp loyees. Th e PEO p erforms all
the HR duties of an emp loyer—recruiting, background checks, hiring, p ayroll,
p erformance ap p raisal, bene ts administration, and other day-to-day HR
activities—and in return is p aid a p lacement fee of, normally, 4 to 8 p ercent of
p ayroll cost p lus 10 to 20 p ercent of gross wages. Because PEOs can coemp loy
a large number of p eop le working at many different comp anies, they can p rovide emp loyees with bene ts and health p lans that small comp anies cannot
afford. Unlike temp orary agencies, which sup p ly workers only for limited
p eriods, emp loyee leasing comp anies p lace their emp loyees with subscribers
on a p ermanent basis. Th e Society for Human Resource Management rep orts
that comp anies with fewer than 50 emp loyees can save anywhere from $5,000
to $50,000 in time and labour costs annually by hiring a PEO. 56
employee leasing
The process of dismissing employees
who are then hired by a leasing company
(which handles all HR-related activities) and
contracting with that company to lease back
the employees
realistic job preview (RJP)
Informing applicants about all aspects of the
job, including both its desirable and undesirable facets
Check In
Have you ever used social media in trying to get recruited? How was your experience? Ask a few
classmates this question and compare your answers.
Im p r o v in g t h e Effe c t iv e n e s s o f Re c r u it in g
How well is a company doing when it comes to recruiting talent from all sources?
Have the rm’s recruiters been able to hire enough employees to meet the company’s needs, including key personnel? Are the recruiters slow or fast when it
comes to lling positions? Are line managers happy with the process and the
quality of the people hired? Are the people who have been hired happy with
their jobs and likely to remain with the rm and advance in the organization? HR
managers have many tools available to them to gauge their efforts and improve
their recruiting. Let’s look at a few of them.
Learning Outcome 4
Discuss the techniques organizations can
use to improve their recruiting efforts.
U s in g Re a lis t ic J o b P r e v ie w s
One way that organizations may be able to increase the effectiveness of their
recruitment efforts is to provide job applicants with a r ealistic job p r eview (RJP ).
An RJP informs applicants about all aspects of the job, including both its desirable
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and undesirable facets. In contrast, a typical job preview presents the job only in
positive terms. The RJP might also include a tour of the working area, combined
with a discussion of any negative health or safety considerations. Proponents
of RJPs believe that applicants who are given realistic information regarding a
position are more likely to remain on the job and be successful because there
will be fewer unpleasant surprises. In fact, a number of research studies on RJPs
report that they can yield results such as realistic job expectations on the part of
employees, better job satisfaction, and lower turnover.
Some companies are taking their RJPs online. For example, ThriveMap is a
company that creates personalized, realistic work simulations. Employees have a
chance to go through a virtual “day in the life” experience, allowing the company
to see how the candidate’s behaviour uniquely ts with the company culture.57
Su r v e y s
Another way to improve a company’s recruiting is to survey managers about how
satis ed they are with the process. Are managers happy with the time it takes to
hire new employees, the degree to which they need to be involved in the process,
and, ultimately, the overall quality of the people recruited? Why or why not? New
hires can also be surveyed to see how satis ed they are. Lastly, candidates who
turned down jobs often can provide valuable information about why they did not
accept the rm’s offer.
Re c r u it in g M e t r ic s
As we explained earlier in the chapter, recruiters should keep statistics on the
sources from which candidates are recruited and hired as well as the costs of
each source. The time it takes to recruit various employees from various sources
and the quality of employees are other statistics recruiters collect and study.
Doing so helps them understand which recruiting sources work best for different
employees, which allows them to nd better employees faster and at a lower cost.
Quality- o f- Fill Statistic s
As we indicated in the Calculating Employee Turnover and Absenteeism appendix,
hiring quality employees is a primary concern of recruiters. Firms have attempted
to develop a quality-of- ll statistic they can use to improve their recruiting processes. The following is one suggested way of calculating an annual quality-of- ll
metric for an organization:
quality of hire 5 (PR 1 HP 1 HR)/ N
where PR = average job performance rating of new hires
HP = percentage of new hires reaching acceptable productivity
within an acceptable time frame
HR = percentage of new hires retained after one year
N = number of indicators
Example
PR = average 3.5 on a 5.0 scale 70 percent
HP = of 100 hires made one year ago, 75 are meeting acceptable productivity levels 75 percent
HR = 20 percent turnover 80 percent HR
N= 3
quality of hire 5 (70 1 75 1 80)/ 3 5 75
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The result is a quality level of 75 percent for new employees hired during
the year.
Tim e to Fill
The tim e-to- ll m etr ic refers to the number of days from when a job opening
is approved to the date the person is ultimately selected for the job. Figure 5.3
shows an example of how the time-to- ll metric is calculated. Generally speaking,
lower time-to- ll statistics are better. However, a trade-off must be made between
the time to ll a position and the quality of the candidates needed for the position.
Yie ld Ratio s
Yield ratios help indicate which recruitment sources are most effective at producing
quali ed job candidates. Quite simply, a yield r atio is the percentage of applicants
from a particular source who make it to the next stage in the selection process. For
example, if 100 résumés were obtained from an employment agency and 17 of the
applicants submitting those résumés were invited for an on-site interview, the yield
ratio for that agency would be 17 percent (17/ 100). This yield ratio could then be
recalculated for each subsequent stage in the selection process (e.g., after the interview and again after the nal offer), which would result in a cumulative yield ratio.
By calculating and comparing yield ratios for each recruitment source, it is possible
to nd out which sources produce quali ed applicants.
time-to- ll metric
The number of days from when a job
opening is approved to the date the
candidate is selected
yield ratio
The percentage of applicants from a recruitment source that make it to the next stage
of the selection process
Co sts o f Re c ruitm e nt
The costs of various recruiting procedures can be computed using a fairly simple
set of calculations. For example, the average source cost per hire (SC/ H) can be
determined by the following formula:
SC
AC 1 AF 1 RB 1 NC
5
H
H
where AC = advertising costs, total monthly expenditure (e.g., $32,000)
AF = agency fees, total for the month (e.g., $21,000)
RB = referral bonuses, total paid ($2,600)
NC = no-cost hires, walk-ins, nonpro t agencies (e.g., $0)
H = total hires (e.g.,119)
F ig u r e 5 .3
Tim e - to - Fill Calc ulatio ns
Position
Date Position
Approved
Date Offer
Accepted
Date Started
Work
Selection Time
Time to Start
Engineer
10/10/18
11/30/18
12/15/18
51
15
Marketing manager
10/11/18
11/24/18
12/16/18
44
22
Salesperson
10/12/18
11/13/18
11/20/18
32
7
Administrative assistant
10/13/18
11/7/18
11/14/18
25
7
Clerk
10/13/18
10/30/18
11/14/18
17
15
33.8
13.2
Average
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Substituting the example numbers into the formula gives
SH $32,000 1 $21,000 1 $2,600 1 $0
5
H
119
$55,600
5
116
5 $467.23 (source cost of recruits per hire)
applicant tracking system (ATS)
Asoftware application recruiters use to
post job openings, screen résumés, contact
potential candidates for interviews via email,
and track the time and costs related to
hiring people
When combined with information about yield ratios, these calculations
can provide invaluable information to managers about the utility of different
approaches to and sources of recruitment. In that way, they can make more
informed decisions about both controlling the costs of recruitment and increasing
its effectiveness. For example, although advertisements and employee referrals
may both yield quali ed applicants, managers may nd that referral bonuses are
a more economical alternative.
An ap p lican t tr ack in g system (ATS) can help a rm automatically track and
calculate the statistics we have discussed, and more. An ATS enables recruiters to
electronically post job openings, screen the uploaded pro les and/ or the résumés
of applicants, rank them, and contact them via email for interviews. An ATS also
tracks the sources of applicants—from the various websites they use to apply
for jobs and how far they got in the process—and the time and costs related to
hiring people. Looking at this data can help recruiters ne-tune where and how
they are recruiting.
Rather than employ an ATS, Google has used reams of data and analytics to
gure out why it was having problems recruiting diverse candidates, particularly
women engineers. The company also developed an algorithm to predict which
candidates have the highest probability of succeeding once hired. Spokespeople
for Google say the company is determined to bring the same level of rigour to
personnel decisions as it does its engineering decisions. Moreover, Google isn’t
waiting for great candidates to come for it. It’s a search-engine company after all.
The company is using machine learning and big data to suggest opportunities at
Google aligned to a job seeker’s skill sets and interests.58
Re t e n t io n : H o w D o W e K e e p O u r Ta le n t ?
The ipside of recruiting is retaining employees. You’ve burnished your brand and
enticed people to join your organization. But what will make them remain with
your rm? Turnover drags down morale among a rm’s staff and takes a toll on
productivity. Replacing employees is extremely costly and time consuming. Yet a
recent Dale Carnegie study estimated that nearly a quarter of employees are planning to look for new jobs in the coming year, and 15 percent are already doing so.59
Why are so many employees planning to leave their jobs? And, what,
if anything, can be done about it? Many managers believe employees leave
their organizations for better pay and bene ts they can’t match. Google offers
employees free massages and rides back and forth to work. Some organizations
are attracting and retaining employees by offering them student-loan repayment
assistance. Programs such as these are helping companies retain Generation Z
and millennial workers, who tend to switch employers frequently.
However, contrary to what managers believe, factors other than pay and
bene ts are usually what prompt employees to quit. They quit their jobs because
they think their input isn’t valued, they were a poor t for the job in the rst
place, or they have too few growth and advancement opportunities.
The Carnegie study found that leadership is the key reason for turnover.
Supervisors must demonstrate interest in and empathy toward their employees
but too few do. Supervisors also need to help employees grow and develop, a
topic that’s discussed in the next section.
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Some rms conduct “stay” interviews with long-time employees to determine
why they have remained with the rm for as long as they have. What do they like
about it, and what needs improving? Human resource managers can then use that
information to develop retention strategies.
Ta r g e t e d Re c r u it m e n t
Diversity in the workplace is a fast-growing trend in the business world that
results in many positive organizational outcomes. However, simply casting a wide
net as a recruitment strategy does not ensure that an organization adequately
represents speci c groups, and therefore, organizations may engage in targeted
recruitment. Ta r geted recr u itmen t involves recruitment strategies that meet
diversity objectives through outreach to underused groups to maintain diverse
representation in an applicant pool.60 A targeted recruitment strategy entails a
prearranged plan to promote job openings in speci c places and ways that attract
candidates with certain experiences or characteristics. It involves a recruitment
process that has a more de ned target market. Targeted recruits might include
individuals with particular skills, living in a designated area, individuals with a
disability (including neurodivergent individuals), or members of an underrepresented demographic group (including older Canadians, Indigenous Peoples,
visible minorities, and women).61
There is a plethora of bene ts to targeted recruitment and building a diverse
workforce. It can increase employee morale and raise employee engagement.62
Firms may also wish to hire certain diverse applicants who support their overall
strategy. For example, rms using a differentiation strategy may seek diverse
applicants to enhance innovation and creativity.63 Targeted recruitment can also
emphasize commitment to local communities and display the value an organization places on representation.64 Thus, targeted recruitment can serve as an
employer branding strategy. It creates a message that an organization is a positive place to work for traditionally excluded groups. This branding strategy is
particularly important in the modern climate. Employees or candidates now pay
close attention to the messages in what some have termed “predominantly white
organizations,” or otherwise, organizations that do not adequately represent the
spectrum of individuals in their population.65 In a study of 335 organizations, it
was found that there is a signi cant relationship between the level of diversity
management in the organization and the evaluation of the company’s image.
Therefore, diversity is an integral aspect of employer branding.66
Targeted recruitment is necessary for designated groups as certain obstacles,
setbacks, and barriers that such groups face must be addressed to even the playing
eld. One example of a challenge that designated groups face is the wording of
job descriptions that prevent or cause speci c individuals to scare away from
applying to positions. For example, individuals with autism are less likely to apply
to jobs in which they do not meet all the criteria on the job description. This
nding has also been found in women.67
Anoth er obstacle is ap p arent from a study th at found th at 40 p ercent of
Canadian banking-sector emp loyers recognized barriers in th eir h iring p ractices for Indigenous individuals. One of th e most signi cant barriers was th e
absence of Indigenous role models and mentors with in th e banking and nancial sector. Th ough 82.9 p ercent of th e emp loyers h ad an emp loyment equity
committee, a mere 34.3 p ercent h ad an Indigenous emp loyee on th e committee, and only 11.4 p ercent h ad an Indigenous manager on th e committee. 68
Hence, from 2011 to 2018, th e rep resentation rate of Indigenous Peop les in
th e banking and nancial sector remained almost entirely unch anged and can
p artially be blamed on th e absence of targeted recruitment sp eci cally for
Indigenous communities. 69
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Th ere are various strategies an organization may use for targeted recruitment.
At the beginning of a job search p rocess, ap p licants generally have limited
data on the organization and they trust signals from the organization, such as
recruiter characteristics and advertisements, to develop verdicts about the organization’s culture and emp loyees. 70 Th us, an organization may do something
as simp le as rewriting job descrip tions and including only the most integral
asp ects of the job to level the p laying feel and allow candidates to ap p ly who
would have otherwise been deterred from ap p lying. 71 Another simp le strategy
is p ictorial diversity, meaning that a diverse group of individuals are disp layed
in p hotograp hs to attract a diverse p ool of ap p licants. 72 Minorities have been
found to p ay closer attention to race and diversity p olicies in recruitment brochures. 73 Th erefore organizations should revisit their diversity p olicies. A job ad
should also include equal emp loyment op p ortunity statements. 74 Th ough these
strategies are useful and imp ortant, they still may not be suf cient to ensure
adequate rep resentation.
Another key strategy involves community outreach and working with certain
organizations and focus groups that represent the designated groups in question.
The organization should make themselves known and post job ads where the
target candidates live, work, and visit online.75 As an example of such outreach,
Employee Accessibility Resource Network (EARN) hosted a target recruitment
event with Employee and Social Development Canada (ESDC). ESDC invited
hiring managers from different work areas to meet with and collect résumés
from candidates with disabilities. More than 50 jobseekers joined the event.76
As another example, in a strategy to attract more females to the technology
sector, organizations reached out to focus groups and ask them to send job ads
to their members. Focus groups included Women in Physics, Women in Materials
Science and Engineering, and Women in Engineering.77 Some organizations may
also work with specialized placement rms well-versed in where to look to nd
speci c candidates.78 There is also recruiting software available that specializes
in targeted marketing.79
Targeted recruitment may also involve crafting a job to appeal to an intended
group of individuals. For example, Bethany Care Society in Calgary has received
awards such as the Best Employers Award for 50-Plus Canadians from the
Workplace Institute in Toronto. The organization engages in targeted recruitment
efforts geared toward an older community. One of its strategies is to emphasize
meaningful work and long-term relationships, which the organization claims is
a different type of reward that is more attractive to people later in their careers.
The organization also targets opportunities that would appeal to a more senior
workforce, such as mentoring or coaching roles.80
Targeted recruitment has found success in several organizations. For example,
the Halifax Regional Police are the only force to match or surpass the racial diversity of its community. Halifax Regional Police chief Jean-Michel Blais explained
that his force rst started targeting minority groups in the mid-1990s. Blais stated,
“We started some very targeted recruitment where we wanted to get members of
the African Nova-Scotian community here. We’re now working very closely with
the Muslim community. The most important thing is diversity of thought. We
want to be able to encourage the best decision-making possible.”81
Check In
If you’re employed, ask your boss what methods they have most successfully used to recruit
employees. Compareyour ndings with thoseof your classmates. Does therecruiting sourceseem
to depend on the type of job?
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C a r e e r M a n a g e m e n t : D e v e lo p in g Ta le n t
o v e r Tim e
Learning Outcome 5
Explain how career management programs
integrate the needs of individual employees
and their organizations.
Integrating career develop ment with other HR p rograms creates synergies in
which all asp ects of HR reinforce one another. Figure 5.4 illustrates how HR
structures relate to some of the essential asp ects of the career management
p rocess. For examp le, to p lan their careers, emp loyees need organizational
information—information that strategic p lanning, forecasting, succession p lanning, and skill inventories can p rovide. Similarly, as they obtain information
themselves and use it to p lan their careers, emp loyees need to know what the
career p aths within their organizations are and how management views their
p erformance.
Th e G o a l: M a t c h in g In d iv id u a l a n d O r g a n iz a t io n a l
Needs
A career development program should be viewed as a dynamic process that
matches the needs of the organization with the needs of the employees. Each
party has a distinctive role to play.
F ig u r e 5 .4
H R’s Ro le in Care e r M anag e m e nt
THE GOAL: MATCH
INDIVIDUAL AND
ORGANIZATION NEEDS
1
IDENTIFY CAREER
OPPORTUNITIES &
REQUIREMENTS
The Goal: Matching
Opportunities & Requirements
Create a supportive
environment.
Communicate the direction of
the company.
Establish mutual goal setting
and planning.
Identify future competency
needs.
Establish job
progressions/career paths.
Balance promotions,
transfers, exits, etc.
Establish dual career paths.
4
INSTITUTE CAREER
DEVELOPMENT INITIATIVES
Career Development
Initiatives
Provide workbooks and
workshops.
Provide career counselling.
Provide career
self-management training.
Give developmental
feedback.
GAUGE
EMPLOYEE POTENTIAL
3
Gauge Employee Potential
Measure competencies
(appraisals).
Establish talent inventories.
Establish succession plans.
Use assessment centres.
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The Em p lo ye e ’s Ro le
Changes in the workplace are occurring so rapidly that employees need to take
an active role in planning their careers. What career options would a person
be able to pursue if they were downsized? At some point in their careers, most
employees will face this situation.
The Org anizatio n’s Ro le : Estab lishing a Favo urab le
Care e r De ve lo p m e nt Clim ate
If career development is to succeed, it must receive the complete support of top
management. Ideally, senior line managers and HR department managers should
work together to design and implement a career development system. An HR
philosophy can provide employees with a clear set of expectations and directions
for their own career development.
B le nd ing the Go als o f Ind ivid ual Em p lo ye e s w ith the
Go als o f the Org anizatio n
Of course, a career development program should be based on the organization’s
goals and needs as well. As Figure 5.5 shows, the organization’s goals and needs
should be linked with the individual career needs of its employees in a way that
improves the effectiveness of workers and their satisfaction as well as achieves
the rm’s strategic objectives. Before a rm’s employees can engage in meaningful
career planning, however, not only must they have an awareness of the organization’s philosophy, they must also have a good understanding of the organization’s
more immediate goals. Otherwise, they might plan for personal change and growth
without knowing whether or how their own goals match those of the organization.
Id e n t ify in g C a r e e r O p p o r t u n it ie s a n d
Re q u ir e m e n t s
Although talent management integrates a number of related HR activities,
those who direct the process have to keep a steady watch on the needs and
requirements of the organization. This involves an analysis of the competencies
F ig u r e 5 .5
B le nd ing the N e e d s o f Ind ivid ual Em p lo ye e s w ith the N e e d s o f The ir Org anizatio ns
INDIVIDUAL’S NEEDS
ORGANIZATION’S NEEDS
Strategic
Current competencies
Future competencies
Market changes
Mergers, etc.
Innovation
Growth
Downsizing
Restructuring
198
Operational
Employee turnover
Absenteeism
Recruiting
Outsourcing
Productivity
Personal
Age/tenure
Family concerns
Spouse’s employment
Ability to relocate
Outside interests
Professional
Career stage
Education & training
Promotion aspirations
Performance
Current career path
CAREER MANAGEMENT
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required for jobs, progression among related jobs, and the supply of ready (and
potential) talent available to ll those jobs. A variety of approaches can be used
to do this, including surveys, informal group discussions, and interviews. The
process should involve personnel from different groups, such as new employees,
managers, long-time employees, minority employees, and technical and professional employees. Identifying the needs and problems of these groups provides
the starting point for the organization’s career development efforts.
B e g in w ith a Co m p e te nc y Analysis
It is important for an organization to study its jobs carefully to identify and assign
weights to the knowledge and skills that each one requires. This can be achieved
with job analysis and evaluation systems such as those used in compensation programs. The system used at Sears, an organization that has experienced signi cant
changes recently, measured three basic competencies for each job: know-how,
problem solving, and accountability. Know-how is broken down into three types of
job knowledge: technical, managerial, and human relations. Problem solving and
accountability also have several dimensions. Scores for each of these three major
competencies are assigned to each job, and a total value is computed for each job.
For any planned job transfer, the amount of increase (or decrease) the next job
represents in each of the skill areas, as well as in the total point values, can be computed. This information is then used to make certain that a transfer to a different
job is a move that requires growth on the part of the employee.
Sears designed career development paths to provide the following experiences:
(1) an increase in at least 1 skill area on each new assignment, (2) an increase of
at least 10 percent in total points on each new assignment, and (3) assignments in
several different functional areas.82
Id e ntify Jo b Pro g re ssio ns and Care e r Paths
Once the skill demands of jobs are identi ed and weighted according to their
importance, it is then possible to plan job p r ogr ession s. A new employee with
no experience is typically assigned to a “starting job.” After a period of time in
that job, the employee can be promoted to one that requires more knowledge
and/ or skill. Although most organizations concentrate on developing job progressions for managerial, professional, and technical jobs, progressions can be
developed for all categories of jobs. Job progressions can then serve as a basis for
developing car eer p ath s—the lines of advancement within an organization—for
individuals. Figure 5.6 illustrates a typical line of advancement in the HR area of
a large multinational corporation. As you can see from the gure, in this rm, a
person must be prepared to move geographically to advance very far in the HR
department. This might also be true of other career elds within the organization.
job progressions
The hierarchy of jobs a new employee
might experience, ranging from a starting
job to jobs that successively require more
knowledge and/or skill
career paths
Lines of advancement in an occupational
eld within an organization
Trac k Care e r Stag e s
A person’s knowledge, skills, abilities, attitudes, and career aspirations change
with age and maturity. The challenges and frustrations people face at the same
stages in their careers are remarkably similar. A model describing these stages is
shown in Figure 5.7. The stages are (1) preparation for work, (2) organizational
entry, (3) early career, (4) midcareer, and (5) late career.
The rst stage—preparation for work—encompasses the period prior to
entering an organization, often extending until age 25. It is a period in which
individuals must acquire the knowledge, abilities, and skills they will need to
compete in the marketplace. It is a time when careful planning, based on sound
information, should be the focus. The second stage, which could overlap with the
rst, typically occurs from ages 18 to 25 and is devoted to soliciting job offers and
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F ig u r e 5 .6
Typ ic al Line o f Ad vanc e m e nt in H R M anag e m e nt
Vice president,
HR
Regional HR
associate
HR
associate
Regional
HR manager
Asst. plant
HR manager
HR
supervisor
Corporate
HR manager
Asst. division
HR director
Plant
HR manager
Corporate
HR director
Division
HR director
F ig u r e 5 .7
Stag e s o f Care e r De ve lo p m e nt
Stage 5: Late Career (ages 55–retirement):
Continue to improve one’s productivity, mentor other employees,
and prepare for retirement.
Stage 4: Midcareer (ages 40–55):
Reappraise early career and early adulthood goals, reaf rm or modify
goals, continue to improve one’s productivity, and mentor other
employees.
Stage 3: Early Career (ages 25–40):
Learn job, learn organizational rules and norms, t into chosen
occupation and organization, increase competence, pursue goals.
Stage 2: Organizational Entry (ages 18–25):
Obtain job offer(s) from desired organization(s), select appropriate
job based on complete and accurate information.
Stage 1: Preparation for Work (ages 0–25):
Develop occupational self-image, assess alternative occupations,
develop initial occupational choice, pursue necessary education.
selecting an appropriate job. During this period, a person might also be involved
in preparing for work. The next three stages entail tting into a chosen occupation and organization(s), modifying one’s goals, remaining productive, and,
nally, preparing for retirement. In the remainder of the chapter, we will look
at the challenges faced by students, many of whom are likely to be in the early
stages of their careers. Retirement planning will be discussed in Chapter 11.
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Re c o g nize Diffe re nt Care e r Paths
Career development and planning systems were once primarily focused on
promotions. However, in today’s atter organizations and more dynamic work
environment, an individual’s career advancement can move along several different paths via promotions, transfers, demotions, and even exits. A p r om otion
is a change of assignment to a job at a higher level in the organization. The new
job normally provides an increase in pay and status and demands more skill or
carries more responsibility. The three principal criteria for determining promotions are merit, seniority, and potential. Often, the problem is to determine how
much consideration to give each factor. A common problem in organizations
that promote primarily on past performance and seniority is called the Peter
Pr in ciple. This refers to the situation in which individuals are promoted as long
as they have done a good job in their previous jobs. The situation continues
until someone does poorly in their new job. Then they are no longer promoted.
This results in people being promoted to their level of incompetence. There are
other intra rm challenges related to promotions. Sometimes, extremely good
employees are prevented from being promoted to other departments because
their current managers are reluctant to lose them. And as we pointed out earlier
in the chapter, some managers favour external candidates versus internal candidates because they are not familiar with the external candidates’ aws. This helps
explain why companies so often look outside their rms in an effort to hire “saviour” CEOs.83 In atter organizations, there are fewer promotional opportunities,
so many individuals nd career advancement through lateral moves. A tr an sfer
is the placement of an employee in another job for which the duties, responsibilities, status, and pay and bene ts are approximately equal to those of the previous job they held (although, as an incentive to make a transfer, organizations
sometimes offer transferred employees small pay increases). Individuals who
look forward to change or want a chance to learn more about their organizations
and obtain different skills often seek transfers. Frequently, these employees do
so with an effort to augment their skills so that they will be more promotable in
the future.
A transfer sometimes requires the employee to change their work group,
workplace, work shift, or organizational unit; it may even necessitate moving to
another geographic area. Thus, transfers make it possible for an organization to
place its employees in jobs where there is a greater need for their services and
where they can acquire new knowledge and skills.
A downward transfer, or demotion , moves an individual into a lower-level
job that can provide developmental opportunities. Although such a move is ordinarily considered unfavourable, some individuals may request it to return to their
“technical roots.” It is not uncommon, for example, for organizations to appoint
temporary leaders (especially in team environments) to positions with the understanding that they will eventually return to their former jobs.
Transfers, promotions, and demotions require individuals to adjust to new
job demands and usually to a different work environment. A transfer that involves
moving to a new location within Canada or abroad places greater demands on
an employee because it requires the person to adapt to a new work environment and new living conditions. Even though some employers provide all types
of r elocation ser vices—including covering moving expenses, helping to sell a
home, and providing cultural orientation and language training—there is always
some loss in the employees’ productivity during the relocation process
Of course, many employees choose to exit their organizations as part of their
career development. When a person’s career opportunities within a rm are limited and their skills are in demand externally, the best career options could be
for the individual to switch companies or to work as a freelancer, a consultant,
or an entrepreneur. Although some employees leave voluntarily, other employees
are forced to leave. Larger organizations often provide ou tp lacem en t ser vices to
help terminated employees nd jobs elsewhere. Jack Welch, the former chairman
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promotion
Achange of assignment to a job at a higher
level in the organization
transfer
Placement of an individual in another job
for which the duties, responsibilities, status,
and remuneration are approximately equal
to those of the previous job
relocation services
Services provided to an employee who is
transferred to a new location, which might
include help in moving, selling a home,
orienting to a new culture, and/or learning a
new language
outplacement services
Services provided by organizations to help
terminated employees nd a new job
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of GE, was one of the rst executives to make a commitment to employees to try
to ensure employa bility when the company could no longer guarantee lifetime
employment. That is, GE has committed to providing employees with the skills
and support they would need to nd a job in another organization.84
Employment and Social Development Canada offers several programs
to support the unemployed, the underemployed, and those facing barriers to
employment. Every provincial and territorial government also offers employment
assistance.85
Co nsid e r Dual Care e r Paths fo r Em p lo ye e s
One of the most obvious places where career paths have been changing is in
technical and professional areas. The irony of organizations in the past has been
that the most successful engineers, scientists, and professionals were often promoted right out of their area of specialization into management. Instead of doing
what they were good at, they were promoted into a job they often did not understand or enjoy.
It has become apparent that there must be another way to compensate these
types of professionals without putting them in management positions. The solution has been to develop dual career paths, or tracks, that provide for progression in special areas such as information technology, nance, marketing, and
engineering, with compensation that is comparable to that received by managers
at different levels. As we explained in Chapter 2, Microsoft offers software engineers both a management-focused and a technical specialist career track and
allows them to move back and forth between the two.
Co nsid e r the B o und aryle ss Care e r
A generation ago, career success was synonymous with ascending a corporate
hierarchy over the course of a lifetime spent in a single rm. Today, however,
individuals pursuing bou n da r yless ca reer s prefer to see themselves as selfdirected “free agents” who develop a portfolio of employment opportunities by
proactively moving from employer to employer, simultaneously developing and
using their marketable skills.
Under the boundaryless career model, success dep ends on continually
learning new skills, develop ing new relationship s, and cap italizing on existing
skills and relationship s. These individuals p lace a p remium on exibility and
the cap acity to do several different typ es of tasks, learn new jobs, adjust quickly
to different group settings and organizational cultures, and move from one
rm, occup ation, or industry to another. Their emp loyment security dep ends
on their marketable skills rather than their dedication to one organization over
time. A number of studies have shown that p eop le with boundaryless careers
nd them very satisfying. Organizations can also bene t from a boundaryless
career because it allows them to attract top talent from all over the world on a
p roject-by-p roject basis. 86
H e lp Em p lo ye e s Pro g re ss b e yo nd Care e r Plate aus
career plateau
Asituation in which, for either organizational
or personal reasons, the probability of moving up the career ladder is low
20
Career plateaus are common obstacles in the career development of employees.
A car eer p lateau is a situation in which, for either organizational or personal reasons, the probability of moving up the career ladder is low. There are three types
of plateaus: structural, content, and life. A str u ctu ra l pla tea u marks the end of
promotions. A con ten t pla tea u occurs when a person has learned a job too well
and is bored with day-to-day activities. A life pla tea u is more profound and may
feel like a midlife crisis. People who experience life plateaus often have allowed
work or some other major factor to become the most signi cant aspect of their
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lives, and they experience a loss of identity and self-esteem when they are no
longer advancing in their careers.
Organizations can help individuals cope with plateaus by providing them
with opportunities for lateral growth or allowing them to choose their own
assignments when opportunities for advancement do not exist. Companies with
international divisions can encourage employees to take assignments abroad to
expand their horizons, lead philanthropic and volunteer activities for their rms,
or take sabbaticals. A sab b atical is an extended period of time during which an
employee leaves an organization to pursue other activities before returning to the
rm. Career enrichment programs can help people learn more about what gives
them satisfaction within a company, as well as what kinds of opportunities will
make them happiest if they go elsewhere.
sabbatical
An extended period of time in which an
employee leaves an organization to pursue
other activities and later returns to their job
C a r e e r D e v e lo p m e n t In it ia t iv e s
In a study undertaken by the HR consulting rm Drake Beam Morin (DBM), the
six most successful career management practices used within organizations are
as follows:
●
●
Employees have clear expectations so they know what is expected of them
throughout their careers with the organization.
Employees have the opportunity to transfer to other of ce locations, both
domestically and internationally.
●
A clear and thorough succession plan is provided to employees.
●
Performance is encouraged through rewards and recognition.
●
●
Employees have the time and resources they need to consider short- and
long-term career goals.
Employees are encouraged to continually assess their skills and career direction.
In contrast, organizations also need to be mindful of the internal barriers
that inhibit employees’ career advancement. Generally, these barriers can include
such things as the following:
●
●
●
lack of time, budgets, and resources for employees to plan their careers and
to undertake training and development;
rigid job speci cations, lack of leadership support for career management,
and a short-term focus; and
lack of career opportunities and pathways within the organization for
employees.87
A variety of tools are available to help employees further their careers within
an organization. Informal counselling by HR staff and supervisors is widely used.
Career planning workbooks and workshops are also popular tools for helping
employees identify their potential and the strength of their interests. Supporting
career development activities can help the organization achieve retention and
productivity goals.
Care e r Planning W o rkb o o ks and W o rksho p s
Several organizations have prepared workbooks to guide their employees individually through systematic self-assessment of values, interests, abilities, goals,
and personal development plans.
Like workbooks, career planning workshops help employees seek career
planning information, make career decisions, set goals, and, at the same time,
build con dence and self-esteem.88 However, workshops also give employees the
opportunity to compare and discuss their concerns and plans with other people
in similar situations and the professionals who conduct the workshops.
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Care e r Co unse lling
career counselling
The process of discussing with employees
their current job activities and performance,
personal and career interests and goals,
personal skills, and suitable career
development objectives
fast-track program
Aprogram that encourages new managers
with high potential to remain with an
organization by enabling them to advance
more rapidly than those with less potential
Career cou n sellin g is the process of talking with employees about their current
job activities and performance, personal and career interests and goals, personal
skills, and suitable career development objectives. To truly expand an organization’s talent pool, managers should make career counselling part of the performance appraisals. They can do so by simply asking employees what their career
aspirations are. Once the conversation has begun, how those goals can be achieved
and t in with the organization’s goals can be discussed and a career “action” plan
for the employees established. Several techniques for career counselling are outlined in the Personal Career Development appendix, which can be found online, at
page A5-1. The obligations of employees to return the organizational investments
in their development are outlined in Ethics in HRM. As employees approach retirement, they may be encouraged to participate in preretirement programs, which
often include counselling. Preretirement programs will be discussed in Chapter 11.
In helping individuals plan their careers, it is important for organizations to
recognize that younger employees today seek meaningful training assignments
that are interesting and involve challenge, responsibility, and a sense of empowerment. They also have a greater concern for the contribution that their work in
the organization will make to society. Unfortunately, they are frequently given
responsibilities they view as rudimentary, boring, and composed of too many
“busy-work” activities. Some organizations are attempting to retain young managers with high potential by offering a fast-tr ack p r ogr am that enables them to
advance more rapidly than those with less potential. A fast-track program can provide for a relatively rapid progression—lateral transfers or promotions—through
a number of managerial positions designed to expose the employee to different
functions within the organization.
Ethics in HRM
Unp aid Inte rnship s: Training o r Exp lo itatio n?
The rise in unpaid internships in Canadian workplaces has
become a subject of much debate among scholars and practitioners alike. With the upsurge in the use of unpaid internships
in an increasing number of organizations, there is much debate
regarding the ethical implications of such permitted or legal
actions.
CBC News reports that there are roughly 300,000 interns
working in some of Canada’s biggest and richest organizations
for free. Using unpaid interns within organizations has been
around for decades, but it became more of an issue following
the 2008 recession, when more and more organizations began
to rely on unpaid interns, all in the name of providing them
with relevant skills that are supposed to help guide their future
careers.
According to The Canadian Press, organizations are
returning to labour practices that were prominent in the
19th century. On the one hand, “hiring” unpaid interns is legal in
Canada when the rules are followed; these rules are stipulated
in employment standards legislation across Canada. But, on the
other hand, it poses an ethical (and sometimes illegal) concern in
that employers can exploit the law simply by labelling employees
“unpaid interns” to avoid compensating them for their labour.
Arguably, there is some merit to employers providing young
graduates with work experience or training that can be valuable
to the development of their careers in speci c elds. But are
these employers actually helping the young graduates? Or are
they getting away with free labour by exploiting the fact that the
graduates are desperate to nd employment?
Sources: Ontario Ministry of Labour, “Are Unpaid Internships Legal in Ontario,” (March 2014), http://www.labour.gov.on.ca/english/es/pubs/internships.
php; David Doorey, “Are Unpaid Interns Illegal in Ontario?” (September 27, 2010), http://lawofwork.ca/?p=2169; CBC News, “Unpaid Internships Focus
of Growing Backlash, Pressure Mounting to Crackdown on Unpaid Internships,” Canadian Press (March 2, 2014), http://www.cbc.ca/news/canada/
unpaid-internships-focus-of-growing-backlash-1.2556977.
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F ig u r e 5 .8
To p 10 M yths ab o ut M e nto rs
Myth 1: Mentors exist only for career development. Sometimes
the mentor focuses on formal career development. Sometimes the
mentor is teacher, counsellor, and friend. Some mentors assume
all these roles. This enhances both personal and professional
development.
Myth 2: You need only one mentor. We can have multiple mentors
in our lives. Different mentors provide different things to help
protégés with their careers.
is what (not whom) you need. Do not be afraid to actively seek a
mentor.
Myth 7: Highly pro led people make the best mentors. Prestige
and success can be good, but good advice, leadership styles,
and work ethics vary by individuals. Good mentors are people
who challenge you according to your needs, readiness, and
aspirations.
Myth 3: Mentoring is a one-way process. Learning ows both
ways. The mentor often learns from the protégé, so the growth is
reciprocal.
Myth 8: Once a mentor, always a mentor. Over time, the
mentor should pull back and let the protégé go their own way.
Although the two may maintain contact, the relationship changes
over time.
Myth 4: A mentor must be older than the protégé. Age does not
matter. Experience and wisdom matter. Do not deprive yourself of
learning opportunities from others who have rich experiences.
Myth 9: Mentoring is a complicated process. The most
complicated part is getting out of a bad mentor relationship. If the
relationship is not productive, nd a tactful way to disengage.
Myth 5: A mentor must be the same gender and race as the
protégé. The purpose of mentoring is to learn. Do not deprive
yourself. Seek mentors who are different from you.
Myth 10: Mentor–protégé expectations are the same for everyone.
Individuals seek mentors for the same reasons: resources,
visibility, enhanced skills, and counsel. But each individual brings
different expectations. The key is understanding where the
protégé is now, not where they should be.
Myth 6: Mentor relationships just happen. Being in the right place
at the right time can help, but the key to selecting a good mentor
M e nto ring
It is common to hear people mention individuals at work who in uenced them.
They frequently refer to their immediate managers, who were especially helpful
as career developers. But they also mention others at higher levels in the organization who provided them with guidance and support in the development
of their careers. Executives and managers who coach, advise, and encourage
employees are called m en tor s.
A mentoring relationship need not be formal. In reality, informal mentoring
goes on daily within every type of organization. Generally, the mentor initiates
the relationship, but sometimes an employee will approach a potential mentor
for advice. Most mentoring relationships develop over time on an informal basis.
They frequently end that way too. However, proactive organizations emphasize
formal mentoring plans that assign a mentor to employees considered for upward
movement in the organization. GE, for example, selects the top 20 percent of its
performers and allows these people to choose their own mentors from a list of
top executives. Under a good mentor, learning focuses on goals, opportunities, expectations, standards, and assistance in ful lling one’s potential. Rever se
m en tor in g is a program whereby younger employees are called on to mentor
older employees and executives about social media trends, new technology, and
marketplace trends. Hewlett-Packard and Cisco are among the companies that
have implemented reverse mentoring. At Cisco, when the word got out that some
executives had younger mentors, other executives wanted mentors, too. Reverse
mentoring programs help younger employees feel valued and “heard” and can
increase their retention.89
The top 10 myths about mentors are shown in Figure 5.8. A list of the most
effective features of mentors, as well as partners, is shown in Figure 5.9. To form
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mentors
Individuals who coach, advise, and
encourage individuals of lesser rank
reverse mentoring
Aprogram whereby younger employees are
called on to mentor older employees and
executives about social media trends, new
technology, and marketplace trends
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an effective mentoring relationship, an employee seeking a mentor should follow
a few general guidelines:
1. Resea rch the per son’s ba ckgr ou n d. Do your homework. The more you know
about your potential mentor, the easier it will be to approach them and
establish a relationship that will work for both of you.
2. Ma ke con ta ct with the per son . Have a mutual friend or acquaintance
introduce you or get involved with your potential mentor in business
settings. That will help the mentor see your skills in action.
3. Requ est help on a pa r ticu la r m a tter . Let th e men tor kn ow th at you
ad mire th em an d ask for h elp in th at aren a. For examp le, you migh t
say, “You ’re good at d ealin g with cu stomers. Wou ld it be okay if I came
to you for advice on my cu stomers?” Keep you r requ est simp le an d
sp eci c.
4. Con sider wha t you ca n offer in excha n ge. Mentoring is a two-way street.
If you can do something for your potential mentor, then, by all means, tell
them.
5. Ar ra n ge a meetin g. Once your speci c request has been accepted, you are
ready to meet with your potential mentor. Never go into this meeting cold.
Set goals, identify your desired outcomes, and prepare a list of questions.
Listen attentively. Then ask your prepared questions and request speci c
suggestions.
6. Follow u p. After the meeting, try some of your potential mentor’s
suggestions and share the results. Express appreciation by identifying
something in particular that was signi cant to you.
7. Ask to meet on a n on goin g ba sis. After your potential mentor has had a
chance not only to meet and interact with you but also to see the value of
what they can provide, you are in a good position to request an ongoing
relationship. Suggest that you meet with them regularly or ask permission
to get help on an ad hoc basis.90
When done well, the mentoring process is bene cial for both the pupil and
the mentor. One survey found, for example, that 77 percent of companies with
successful mentoring programs reported that they effectively increased employee
retention.91 Firms can help facilitate mentoring by rewarding mentors in their
performance appraisals.
F ig u r e 5 .9
M e nto ring Func tio ns
Good Partners . . .
Good Mentors . . .
Listen and understand
Challenge and
stimulate learning
Coach
Build self-confidence
Provide wise counsel
Teach by example
Act as role model
Share experiences
Offer encouragement
SUCCESSFUL
MENTORING
Listen
Act on advice
Show commitment
to learn
Check ego at the door
Ask for feedback
Are open-minded
Are willing to change
Are proactive
Source: Matt Starcevich, PhD, and Fred Friend, “Effective Mentoring Relationships from the Mentee’s
Perspective,” Workforce, supplement (July 1999): 2–3. Used with permission of the Center for Coaching and
Mentoring, Inc., http://coachingandmentoring.com.
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Monkey Business Images/ Shutterstock.com
Managers may act as mentors to those
in early career stages.
Not surprisingly, mentoring is also being done via email or using software or online
programs, a type of mentoring that has become known as e-men torin g. E-mentoring
is commonplace at IBM. “A lot of our people work virtually, and mentoring can erase
geographic and business-unit borders,” explained one IBM manager.92
N e tw o rking
As the number of contacts grows, mentoring broadens into a process of car eer
n etwor k in g. As a complement to mentoring, in which relationships are more
selective, networking relationships tend to be more varied and temporary. The
networks can be internal to a particular organization or connected across many
different organizations.
According to the Monster career advice centre, there are many ways to identify
networking contacts. Some of the best places to consider are the following:
●
your educational alumni association or career of ce networking lists;
●
your own extended family;
●
your friends’ parents and other family members;
●
your professors, advisors, coaches, tutors, and clergy;
●
your former bosses and your friends’ and family members’ bosses;
●
●
career networking
The process of establishing mutually bene cial relationships with other businesspeople,
including potential clients and customers
members of clubs, religious groups, and other organizations to which you
belong; and
all the organizations near where you live or go to school.
In a survey of executives by the HR rm DBM, 61 percent said that they had
found new positions in the previous year through networking. Another study of 15
high-ranking executive women found that although many of them lacked formal
mentors, they had successfully engaged in a kind of “360-degree” networking: the
women made it a point to form and maintain relationships with people above,
below, and at the same level as themselves, which helped advance their careers.93
Care e r Se lf- M anag e m e nt Training
Many organizations are establishing programs for employees on how they can
engage in ca reer self-ma n a gemen t. The training focuses on two major objectives:
(1) helping employees learn to continuously gather feedback and information about
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their careers, and (2) encouraging them to prepare for mobility. The training is not
geared to skills and behaviours associated with a speci c job but rather toward longterm personal effectiveness. Essentially, career self-management is not a process but
an event. Employees typically undertake self-assessments to increase their awareness
of their own career attitudes and values. In addition, they are encouraged to widen
their viewpoint beyond the next company promotion to broader opportunities in
the marketplace, attend conferences, and develop good long-term relationships with
their bosses or other mentors. Participants might be encouraged to engage in career
networking or to identify other means to prepare for job mobility, such as hearing
reports from employees who made transitions to new job opportunities both within
and outside the organization. GE has developed an extensive set of career development programs to help employees explore life issues that affect career decisions.94
Check In
Why should both employees and their employers be concerned about career management
programs?
Small Business Application
Sm a ll C o m p a n ie s O ft e n O ffe r B ig Re w a r d s
Once upon a time, it seemed that all young professionals
dreamed of working their way up the corporate ladder to
success in a large company and retaining those well-paid, perkladen positions until the employees were ready to fade into the
sunset. Yet evolving trends over the last 20 years have turned
that rosy view of corporate life into a myth, and no one seems
to be the worse for it. Quite the contrary. Many new grads and
seasoned professionals alike are choosing to work for lessthan-500-employee rms because of the many advantages
they offer, and smaller rms are welcoming these knowledge
workers with open arms.
For the midterm and advanced career professionals, transitioning from a large corporation to a smaller one often means
jumping straight into the limelight. The change is rejuvenating
as they nd themselves taking on more diverse responsibilities,
getting involved in new arenas, and seeing more clearly how
their own efforts impact the company’s results. And with all of
that comes greater recognition. “Your work and contributions
will be noticed,” says Lindsey Pollak, a management expert
of next-generation career trends. “You are more likely to be
listened to, and to feel that you are an important part of the
company and that your ideas really matter.”
Even those with fewer years of experience under their
belts are likely to be energized by working in smaller rms.
Job descriptions tend to be less de ned in these environments,
giving employees the chance to push themselves in new directions beyond the con nes of their jobs. They also often nd
themselves working with the highest-level managers, learning
directly from experts. Small- rm employees of all types often cite
another bene t: working in a small company means enjoying a
big-picture view of the business and industry, rather than getting
pigeonholed into one small aspect of the work at hand.
However, employees who opt for working in a small rm
cannot expect to nd everything they might get in a larger corporation. Tighter budgets mean that smaller companies sometimes cannot afford to pay salaries equal to those of big rms
and often cannot provide the support systems or perks, such as
generous expense accounts, hefty bonuses, and company-paid
smartphones. But many small employers provide alluring tradeoffs, such as shorter work weeks, less travel, and work–life
balance incentives, including telecommuting and extime.
Where people decide to work really comes down to determining how they are going to meet their career and life goals.
Notes management author and analyst Tony Jacowski, “Your
choice of organization should be based on the quality of work
experience you will gain rather than the size of the organization.
If you have the talent and the expertise, you will quickly climb
the corporate ladder irrespective of the size of the company.”
Sources: Sarah E. Needleman, “Moving to a Small Company Can Lead to Big Rewards,” The Wall Street Journal (March 5, 2008), http://online.wsj.com; Lindsey
Pollak, “The Advantages of Working for a Small Company,” http://www.lindseypollak.com; Tony Jacowski, “Bene ts of Working in a Small Company vs a
Corporation,” http://ezinearticles.com; Jacqueline Parks, “The Bene ts of Working for a Small Business,” http://www.associatedcontent.com.
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Summary
Outcome 1 To expand the ta len t pool of organizations—
the number and kinds of people available for
employment—organizations must focus on multiple
approaches to recruitment and career management.
Which internal and outside sources and methods are
used in recruiting will depend on the strategy and goals
of the organization, conditions of the labour market,
and speci cations of the jobs to be lled.
Outcome 2 Employers usually nd it advantageous to
use internal promotions and transfers to ll as many
openings as possible above the entry level. By recruiting
from within, an organization can capitalize on the
previous investments they have made in recruiting,
selecting, training, and developing its current employees
and rewarding them. Internal job postings, performance
appraisals, skill inventories, replacement charts, and
assessment centres are ways in which rms identify
internal talent.
Outcome 3 To diversify their talent pools, rms also look
externally for candidates. Advertisements, the Internet,
social networks, mobile recruiting, employment agencies,
tapping educational institutions and professional associations, and rerecruiting are among the many ways rms
recruit external candidates.
Outcome 4 HR managers have many tools available to
them to gauge their efforts and improve their recruiting.
Using RJPs, surveying managers and applicants about
the process, and examining metrics such as the cost per
hire, time to ll a position, and yield ratios are some
of the ways in which rms evaluate their recruiting
efforts. An ATS can help a rm automatically track and
calculate many of these statistics.
Outcome 5 Identifying and developing talent are the
responsibility of all managers. A career development
program is a dynamic process that should integrate the
career goals of employees with the goals of the organization. Job opportunities can be identi ed by studying
jobs and determining the knowledge and skills each
one requires. Once that is accomplished, key jobs can
be identi ed, and job progressions can be planned.
These progressions can then serve as a basis for developing the career paths of employees.
Key Terms
9-box grid, 182
global sourcing, 178
applicant tracking system (ATS), 194 internal labour markets, 178
branding, 179
job progressions, 199
career counselling, 204
mentors, 205
career networking, 207
mobile recruiting, 185
career paths, 199
nepotism, 188
career plateau, 202
outplacement services, 201
employee leasing, 191
passive job seekers, 186
employee pro les, 176
promotion, 201
fast-track program, 204
realistic job preview (RJP), 191
recruiting process outsourcing
(RPO), 177
relocation services, 201
rerecruiting, 188
reverse mentoring, 205
sabbatical, 203
time-to- ll metric, 193
transfer, 201
yield ratio, 193
Discussion Questions
1. Think about excellent experiences you had with
an organization. What was outstanding about
these experiences and the organization? How do
you view its brand? Would you want to work for
them or not?
2. Many companies are nding candidates
through searches of LinkedIn pro les. They
also use LinkedIn and other social media to
screen candidates. Discuss the advantages
and disadvantages of using social media as a
recruitment channel.
3. Why do you think employee referrals are
effective? What advice would you give to an
organization to make its employee referral
program more effective?
4. Ottawa Police Services recognized that
traditional recruiting practices may not work
in a multicultural society. New immigrants may
not view policing as an honourable profession,
based on their previous experiences. Sitting in
large groups hearing about opportunities in the
police force is not effective as many are reluctant
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to ask questions. Newcomers also do not know
about the “ride along” program that most forces
operate as a way to introduce potential recruits
to the daily work of a police of cer. Design a
recruitment campaign for the police force that
would be sensitive to the perceptions and needs
of a multicultural candidate base.
HRM Experience
Care e r M anag e m e nt
We often think that successful people plan their careers in
advance and then work toward their goals in a very logical,
sequential manner. Although some successes are designed
and implemented this way, others are created through insight,
preparedness, and taking advantages of opportunities as
they arise.
Assignment
1. Form teams of four to six members. Identify three people to
interview about their careers. One person should be in the
early stages of their career, one should be in midcareer, and
one should be in the nal stages of their career.
2. Ask each person to identify their career goals and how their
goals have changed or are expected to change over time.
3. Ask each person to describe the sequence of events that led
to where they are. How well does that story align with the
traditional model of careers?
4. Ask each person what (if anything) they would do differently.
Ask what advice they have for you about how to approach
your career.
Sign in or create an account at login.cengage.com to start using MindTap. Register the access code from the printed
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can purchase instant access at Cengage.ca.
Case Study 1
Imprimax
Silvano Audisio/ Shutterstock.com
Imp rimax is a family
business, sp ecializing
in commercial p rinting,
that has been op erating for more than 45
years. The founder’s
son, who now heads
the
comp any,
has
maintained the authoritative management style introduced by his p redecessor. Imp rimax has exp erienced
strong growth thanks to the acquisition of major contracts and the introduction of new technologies. In
addition, its workforce has increased from 300 to 500
emp loyees. The comp any’s management team is comp osed of managers who came up through the ranks of
the organization and are exp erienced in p rinting
techniques.
210
Like all the businesses in its region, Imprimax is
facing both internal and external challenges. Over
the past year, its staff turnover doubled and many
employees retired. The problem was exacerbated by
the current lack of experienced workers available on
the labour market. As part of its succession plan, the
company launched a massive recruitment campaign
among students from trade and technical schools and
universities. The generation clash between the two
groups of employees is already being felt. Although the
young recruits are more technologically advanced, the
older employees are the ones with the speci c knowhow and experience. Networking between the different
generations seems to be problematic, and the retention
rate among the younger generation is low. In fact, a
number of them quit after only several months with the
company. Knowledge transfer and employee retention
are key success factors for Imprimax’s survival.
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As a trainee h ired by th e p lant’s HR manager,
you are asked to analyze th e situation and make recommendations to reduce th e turnover by retaining
young new h ires and p romoting an intergenerational
synergy. With th is in mind, answer th e following
questions.
Questions
1. Identify ve probable causes as to why young new
hires are leaving the company.
2. What could be developed as this employer’s brand
to make it realistic and attractive to candidates?
3. Develop solutions to the recruitment issues facing
this rm.
Source: Reproduced with the permission of the Ordre des conseillers en ressources humaines agréés. All rights reserved.
Case Study 2
Recruitment Channels
JHVEPhoto/ Shutterstock.com
LoyaltyOne is one of
the world’s leading
loyalty
marketing
organizations
and
the creator and operator of Canada’s premier coalition loyalty
program, the AIR
MILES® Rewards Program. As of early 2012, with more
than 10 million Collector accounts, approximately twothirds of all Canadian households actively participate in
the AIR MILES Rewards Program. Working with many
of North America’s leading brands in the retail, nancial services, grocery, petroleum retail, travel, and hospitality industries, LoyaltyOne designs, implements,
and manages coalition loyalty programs and customer
analytics and loyalty management solutions, which
include loyalty consulting and creative, insight-driven
marketing services. LoyaltyOne’s research group
COLLOQUY provides a worldwide audience of more
than 30,000 marketers with news, insights, and best
practices from the loyalty marketing industry.
LoyaltyOne’s website is www.loyalty.com.
LoyaltyOne is a unit of Alliance Data Systems
Corporation (NYSE:ADS). Alliance Data is a leading
provider of loyalty marketing solutions derived from
transaction-rich data for some of the most recognizable brands in North America. Already in uencing over
120 million consumer relationships, Alliance Data is
also expanding its reach into Europe, South America,
and Asia.
With over 1,500 associates across a multitude of functions such as consumer intelligence analysts, marketing
specialists, customer care representatives, IT specialists,
and business developers, LoyaltyOne is continuously
looking for top-calibre talent and maintains a strong
staf ng division.
LoyaltyOne is looking to proactively source candidates to ll a variety of roles within multiple business
units and suspects that its current practices may not
be suf ciently proactive or effective in targeting both
passive and active candidates across the organization.
Currently, LoyaltyOne
employs a well-developed recruitment team
using talent acquisition methods to source
candidates;
is looking for very specialized segments of the
workforce, and these individuals are in limited
supply;
is determined and must work hard to nd and
hire candidates that meet both job requirements
and t the corporate culture;
considers its approach somewhat traditional and
is looking to become more “leading edge”;
wishes to hire quali ed individuals across all
age groups; and
would welcome the creative use of mobile and
social networking tools but currently already
uses LinkedIn and Facebook.
LoyaltyOne faces challenges:
1. The organization’s brand image may not be clearly
recognized by candidates as AIR MILES has historically been the company’s most predominant brand.
2. Its businesses are diverse, as are the knowledge
and skills that it would be seeking in its prospective associates.
Question
1. Provide recommendations for proactive best
practices and leading-edge sourcing approaches.
Source: By permission of LoyaltyOne.
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Case Study 3
Get Paid for an Employee Referral
Tada Images/ Shutterstock.com
At
Accenture,
Inc.,
based in Toronto, an
employee was given a
$6,000 bonus for referring a candidate for a
senior-level job. The
candidate was his longtime friend, and the
employee felt that the real rewards were having his recommendation validated through the selection process
and having a friend at work. Accenture’s Canadian
referral reward policy states that employees who make a
referral receive different bonus amounts based on
employment status and organization-assigned employment level of the recruited hire. For hires designated
full-time temporary, full-time regular, casual, or parttime, employees who made the referral will receive $750.
For permanent positions for career levels 11 to 13
(Analysts or below), employees receive $500; for positions level 8 to 10 (Senior Analysts, Team Leads,
Specialists, Associate Managers, and Senior Specialists),
employees receive $3,000. For career levels 7 and above
(Managers and above), employees receive $6,0000.
According to the director of HR at Accenture, 24 percent
of experienced hires come from staff referrals.
At Ernst and Young LLP, employee referrals are
used because they are more economical than a search
rm, and employees understand the culture of the rm.
Another advantage of employee referral programs is
the increased engagement with the rm’s goals. In
2010, 28 percent of the company’s new hires were
through employee referrals, yet by 2016 the employee
referral program was responsible for over 50 percent of
new hires. “Referral candidates perform better and stay
longer,” says Dan Black, Ernst and Young’s recruiting
leader for the Americas, “In fact, external research has
shown that referred workers are up to 30 percent less
likely to quit and have substantially better performance on high-impact metrics.” At Mars Canada Inc.,
employees care about the business results and success
of the organization, so they are cautious in their recommendations and act as a rst screening. Employees
receive up to $2,000 for successful referral hires. Some
organizations offer even higher rewards. Score Media
Ventures Inc., a company located in Toronto, offers as
much as a $10,000 bonus for employees who assist
in recruiting candidates for its engineering division.
These high bonuses give evidence to the fact that
employee referrals serve as a successful recruitment
method. According to LinkedIn’s 2017 global recruiting
trends report, 48 percent of employers expressed that
employee referrals are the best source of quality hires.
Employee referrals and social recruiting, which
already began melding through Jobvite, and other
tools are growing even closer as new vendors enter the
eld and corporations test how well their jobs spread
on Facebook and other sites. Research has found that
while recruiters are most likely to look for candidates
on LinkedIn, job seekers tend to ock to Facebook.
This nding highlights that social media recruiting
through employee advocacy and referrals could provide organizations with the ability to tap into a wider
range of talent.
Fiverr, a freelancing marketplace, aimed to increase
employee referrals. They did so through tracking social
job sharing and added a gaming component by providing
employees points for sharing jobs on social media and
referring friends. Fiverr used a software company called
Zao (now acquired by PIXID), which would display a
referral leaderboard, and top employees would receive
gifts quarterly or annually.
This smart marriage of referrals and social sites is
where we are headed.
Questions
1. How does automating the employee referral
process encourage referrals?
2. What do you think some of the drawbacks of getting
referrals from social network sites might be?
Source: Excerpted from Todd Raphael, “Employee Referral Programs Using More Social Media” (June 22, 2010), http://www.ere.net; A. Dwyer, “When the Best Talent Is
Close to Home,” The Globe and Mail (November 16, 2011): E1, E6; Accenture, “Alumni Referral Program. Global Policy and Country Supplements,” (2014); Jared Lindzon,
“Hiring Lessons From the Company Adding More Than 15,000 Employees In One Year,” Fast Company (October 10, 2016); Richard Yerema and Kristina Leung, “Canada’s
Top 100 Employers 2021,” Mediacorp Canada 100 (November 12, 2021); Brooke Smith, “Best Practices for Employee Referral Programs,” Bene ts Canada (March 16,
2018); Aria Solar, “The Ultimate Guide to Social Recruiting,” Sprout Social (September 23, 2019); AIHRAcademy, “7 Brilliant Employee Referral Programs Examples,”
https://www.aihr.com/blog/employee-referral-programs-examples/, retrieved August 21, 2021.
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Notes and References
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90. Jeff Barbian, “The Road Best Traveled,” Tra in in g 39,
no. 5 (May 2002): 38–42; Kathleen Barton, “Will You
Mentor Me?” Tra in in g a n d Developmen t 56, no. 5 (May
2002): 90–92.
91. Elaine Biech, “Executive Commentary,” Aca demy of
Ma n a gemen t Execu tive 17, no. 4 (November 2003): 92–94.
92. Jennifer Alsever, “How to Start a Mentorship Program,”
BNET ( June 24, 2008), http:/ / www.bnet.com.
93. Suzanne de Janasz et al., “Mentor Networks and Career
Success”; Jill Rachline Marabix, “Job Search 2. Oh!” U.S.
News & World Repor t 136, no. 8 (March 8, 2004): 60–63.
94. Pamela Tate, “Calling on Career Development,” Ta len t
Ma n a gemen t ( January 7, 2014), http:/ / www.talentmgt.
com, retrieved April 2018; Thomas A. Stewart, “What’s in
It for Me?” Ha r va rd Bu sin ess Review 83, no. 1 ( January
2005): 8; Marilyn Clarke and Margaret Patrickson, “The
New Covenant of Employability,” Employee Rela tion s 30,
no. 2 (2008): 121–41.
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Once a quali ed and diverse applicant pool has been recruited, the company’s
efforts can turn to hiring the best and the brightest from amongst those applicants.
However, there are large gaps between how companies select employees and what
the research literature suggests are the best practices for making hiring decisions;
further, these gaps have been increasing as opposed to decreasing over time.1
Using the best practices from the research literature can help organizations
become more productive while saving money. A study by the Society for Human
Resource Management (SHRM) found that the cost of hiring someone for an intermediate position that has not been carefully planned is approximately $20,000, and
the cost of hiring the wrong person for a senior manager’s position is $100,000.
Moreover, proper selection practices can allow organizations to reach their
equity, diversity, and inclusion goals while avoiding costly litigation. One group
of researchers found that employers lose approximately 90 percent of all hiring
discrimination suits, and the average payout per case is $1.5 million.2
Learning Outcome 1
Explain the goals of the personnel selection
process, its steps, and why the information
gathered during the process must be reliable,
valid, and legally defensible.
selection
The process of choosing individuals who
have relevant quali cations to ll existing or
projected job openings
O v e r v ie w o f t h e Se le c t io n P r o c e s s
Selection is the process of choosing individuals who have the relevant quali cations
to ll existing or projected job openings.
Figure 6.1 shows, in broad terms, that the overall goal of selection is to maximize
“hits” and avoid “misses.” Hits are accurate predictions, and misses are inaccurate
ones. The cost of one type of miss (false positives) is the direct and the indirect
expense of hiring an employee who turns out to be unsuccessful. The cost of the
other type of miss (false negatives) is an opportunity cost—someone who could
have been successful did not get a chance. False negative misses are especially problematic because they are dif cult to detect and may be disproportionately screening
out members of protected groups. Although the overall selection program is often
the formal responsibility of the HR department, managers typically make the nal
decision about hiring people in their unit. It is important, therefore, that managers
understand the objectives, policies, and practices used for selection.
F ig u r e 6 .1
Low
Job Performance
High
The Go al o f Se le c tio n: M axim ize “ H its” and Avo id “ M isse s”
False Negative
True Positive
MISS
HIT
Inaccurate prediction
(person would
have succeeded
on the job)
Accurate prediction
(person succeeds
on the job)
True Negative
False Positive
HIT
MISS
Accurate prediction
(person would not
have succeeded
on the job)
Inaccurate prediction
(person fails
on the job)
High
Low
Predicted Success
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B e g in w it h a J o b A n a ly s is
In Chapter 4, we discussed the process of analyzing jobs to develop job descriptions and speci cations. Job speci cations, in particular, help identify the individual attributes employees need for success—the knowledge, skills, abilities, and
other characteristics (KSAOs) that lead to superior performance. Managers then
use selection methods such as interviews, references, and preemployment tests
to measure applicant KSAOs against the attributes required for the job. Complete
and clear speci cation of required KSAOs helps interviewers differentiate between
quali ed and unquali ed applicants and reduces the effect of an interviewer’s
biases and prejudices. Research also shows that applicants whose KSAOs are well
matched to the jobs they are hired for perform better and are more satis ed than
those whose KSAOs are not well matched.3
Ordinarily, hiring managers are well acquainted with the requirements
pertaining to the skills, physical demands, and other characteristics of the jobs
they oversee. In addition to the requirements of the job, many organizations place
a high priority on selecting individuals who match the values and culture of their
organization. Almost all organizations list their company values on their company
website and then seek to hire candidates who share those values. This process is
referred to as va lu es-ba sed hirin g. The drawback of values-based hiring is that it
can result in a lack of diversity, so rms need to be careful about still ensuring that
they are hiring a demographically diverse workforce.
Th e Se le c t io n P r o c e s s
The number of steps in the selection process and their sequence will vary not
only with the organization but also with the type and level of job to be lled.
Each step should be evaluated in terms of its contribution to the process. The
steps that typically make up the selection process are shown in Figure 6.2. Not
all applicants will go through all of these steps. Some may be rejected after the
preliminary interview, others after taking tests, and so on.
F ig u r e 6 .2
Ste p s in the Se le c tio n Pro c e ss
Hiring decision
Background investigation
Reference checking
Supervisor/team interview
Preliminary selection
in HR department
Employment testing
(aptitude, achievement)
Initial interview
in HR department
Completion of application
Submission of résumé
Note: Steps may vary. An applicant may be rejected after any step in the process.
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As Figure 6.2 shows, organizations are likely to use several different means
to obtain information about applicants. These include gathering résumés and
applications and conducting tests, interviews, and background investigations.
O b t a in in g Re lia b le a n d Va lid In fo r m a t io n
reliability
The degree to which interviews, tests, and
other selection procedures yield comparable
data over time
validity
The degree to which a test or selection
procedure measures a person’s attributes
and predicts future behaviour
Regardless of whether a position is lled internally or externally, it is essential that the information obtained be reliable, valid, and gathered legally while
ensuring that the privacy of applicants be safeguarded. The degree to which
interviews, tests, and other selection procedures yield comparable data over a
period of time is known as r eliab ility. For example, unless interviewers judge
the capabilities of a group of applicants to be the same today as they did yesterday, their judgments are unreliable (i.e., unstable or inconsistent). Likewise, a
test of a supposedly stable attribute (e.g., intelligence) that gives widely different
scores when it is administered to the same individual a few days apart is unreliable. In ter ra ter relia bility—agreement among two or more raters—is another
measure of a method’s consistency.
In addition to h aving reliable information p ertaining to a p erson’s suitability for a job, th e information must also be as valid as p ossible. Reliability
is required for a measure to h ave validity (i.e., with out reliability in our measures, th ere is no ch ance of ach ieving validity). Valid ity refers to wh at a test
or oth er selection p rocedure measures and h ow well it measures it. In oth er
words, th e selection p rocess sh ould be able to p redict h ow well a p erson
p erforms on th e job. Selection is actually a very quantitative eld, as criterionrelated validities refer to th e correlations between selection tools (e.g., tests,
interviews) and relevant criteria (e.g., job p erformance, training p erformance).
Figure 6.3 p resents th e correlations between th e selection meth ods p resented
F ig u r e 6 .3
Se le c tio n M e tho d Valid ity Tab le
Selection Method
Correlation with Job Performance
(i.e., validity)
Cover letters and résumés
.18 for work experience
.10 for years of education
.10 for interests
Application forms
.35 for biodata
Interviews
.51 for structured
.38 for unstructured
Reference checks
.26
Job knowledge tests
.48
Work sample tests
.54
Cognitive ability tests
.51
Personality inventories
.31 for conscientiousness
Honesty and integrity tests
.41
Assessment centres
.37
Source: Frank L. Schmidt and John E. Hunter, “The Validity and Utility of Selection Methods in Personnel Psychology:
Practical and Theoretical Implications of 85 Years of Research Findings,” Psychological Bulletin 124, no. 2 (1998): 262–74,
https://doi.org/10.1037/0033-2909.124.2.262
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in th is ch ap ter and p erformance on th e job. It h as long been establish ed th at
using valid selection p rocedures leads to increases in emp loyee p erformance
and, in turn, bottom-line value for th e organization. 4 Moreover, valid selection
p rocedures are legally required and can h elp organizations defend th eir selection p ractices. 5
Check In
Managers often understand employees’ jobs well. But how important do you think it is for them to
understand the best practices for the selection process?
In it ia l Sc r e e n in g
Employers use many different pieces of information to try to determine whether
an applicant will be successful on the job. The initial pieces of information for
screening candidates include cover letters and résumés, application forms, and
Internet checks and phone screening.
Learning Outcome 2
Describe the tools used to initially screen
applicants, as well as the types of employment interviews, and the post-interview
screening tools that rms use.
C o v e r L e t t e r s a n d Ré s u m é s
Cover letters and résumés have been used for decades to assess the suitability
of applicants, especially for salaried positions. Generally, these documents are
reviewed rst with an eye toward who can be eliminated because they do not
have the skills, abilities, education, or experience outlined in the job advertisement. Did the applicant submit a thoughtful cover letter? Or are they simply
“spamming” companies with résumés? A lack of a cover letter could be one way
of eliminating applicants. Was the cover letter well-written? Well-written cover
letters are important if a requirement of the job is having good written communication skills, which is the case for many jobs. So, for example, if a person
who applied for an online customer service job that includes writing chat messages to customers submitted a cover letter with numerous typos, this could be
grounds for passing over the person. Good writing skills might be less important
for a person who works as a Walmart greeter. Good verbal or interpersonal skills
might suf ce for this position.
Evaluating résumés can be a subjective process with low reliability between
the ratings of evaluators. Evaluators often have a dif cult time applying a set
of consistent standards across multiple candidates or they apply standards that
are irrelevant to success on the job. The fact that there is no “set” format for
writing résumés—they vary from person to person—can make them dif cult for
people to screen. Validity is also an issue because work experience, which is a
factor commonly gleaned from candidate résumés, has a low correlation with job
performance.6
Bias can also enter the p rocess. Th e study ndings discussed in Highlights
in HRM 3.3 (from Chap ter 3) indicated that job ap p licants with English names
have a greater chance of getting interviews than those with names that
indicated Chinese, Indian, or Pakistani descent. 7 A recent study found that
racial-ethnic group member ap p licants who modify their names by deleting
references to their race in their résumés were twice as likely to get called for
interviews. Interestingly, this p ractice was as strong for businesses that claimed
to value diversity as those that did not. Foreign-sounding names were changed
to English-sounding names and achievements earned in ethnic organizations
were removed. 8 To address the issue of p otential discrimination in résumés
because of ethnicity and related factors, some organizations are beginning to
use “name-blind” résumés and recruitment. Th at is, names and other identi ers
are removed from résumés and ap p lication forms to try to stop bias against
racial-ethnic group members. 9
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Ariel Skelley/ Getty Images
Many HR professionals use computer
software to make the process of
screening résumés faster and easier.
Developing explicit evaluation criteria and a structured way to review résumés
can help make the process less subjective. Using application forms may also help
to collect information about minimum quali cations in a more standardized and
comparable manner. Once applicants who are clearly not quali ed are eliminated, a company might use an assessment grid to take some of the guesswork
out of the process. Job description criteria are placed in the left-hand column
of the grid, and candidates are then ranked based on a scale as to whether the
skills outlined in their cover letters and résumés match the job. The totals for the
candidates are then compared.
The downside of manually screening and assessing résumés is that it is
common for a rm to receive hundreds of résumés for a single position. To speed
up the evaluation process, many rms are now using software to scan résumés to
nd quali ed applications. For example, a hiring manager or HR representative
will specify the educational and experience levels a job requires. The software
then scans the résumés collected for that position, pulls a list of quali ed candidates, and ranks them according to how closely they match the job criteria.10
Applicant tracking systems generally include a résumé-screening feature.
Not all HR professionals are fans of résumé-screening software, however.
There is concern that capable people are routinely being rejected by machines
(false negatives), even before a human ever lays eyes on their credentials. Also,
applicants have learned to strategically use a job’s key words on their résumés to
get past résumé-screening software.
A p p lic a t io n Fo r m s
Many organizations require ap p lication forms to be comp leted because they
p rovide a fairly quick and systematic means of obtaining a variety of information about the ap p licant. Ap p lication forms serve several p urp oses. They p rovide
information for deciding whether an ap p licant meets the minimum requirements
for exp erience, education, and training. They also offer sources for reference
checks. For some jobs, a short ap p lication form is ap p rop riate. For examp le,
McDonald’s uses a form that is quite brief but asks for information that is highly
relevant to job p erformance. The form also p rovides information regarding the
emp loyer’s conformity with various laws and regulations. For scienti c, p rofessional, and managerial jobs, a more extended form is likely to be used.
2
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Even when ap p licants come armed with elaborate résumés, they are often
asked to comp lete an ap p lication form early in the p rocess. However, résumés
and ap p lication forms often collect redundant information and thus, ap p lication
forms might be more valuable than résumés as they collect standardized information that can be more readily comp ared across candidates. Further, a survey
by CareerBuilder.com found that far fewer p eop le lie on ap p lication forms relative to their résumés. This may be because ap p licants are often asked to sign
a statement that the information contained on the form is true and that they
accep t the emp loyer’s right to terminate the candidate’s emp loyment if any of
the information is subsequently found to be false.11 Comp anies are now using
comp uters and arti cial intelligence to screen initial ap p lications, as described
in Ethics in HRM.
Ethics in HRM
W ho ’s Re je c ting Yo ur Jo b Ap p lic atio n?
We’ve all been there before. You nd a job ad that you are
interested in responding to, carefully prepare your résumé
and cover letter or complete the company’s application form,
submit your application, and then … you never hear anything
back from the company. Maybe you’ve also completed a
pre-interview assessment or submitted responses to a video
interview and never heard back from the company. Although it
is common knowledge that you won’t receive an interview for
every job that you apply to, what is less well known is what’s
happening behind the scenes once you submit your application, assessment, or video interview response. What is also less
well known are the ethical implications that companies should
take into consideration at all selection stages, including initial
pre-interview screening.
Behind the scenes, it was traditionally a person from the
company screening your application; however, it is often now
a computer, and not a person, screening your application.
Is it ethical for a company to reject your application without
ever being reviewed by an actual person? Companies are
more commonly relying on arti cial intelligence (AI) to screen
applications and this trend has become even more prominent during the recent COVID-19 pandemic. It might appear
that the use of AI in screening will lead to better and more
ethical screening decisions; however, there have been highly
public issues with these types of programs, such as Amazon
choosing to abandon their AI screening system after it was
reported to be biased against women.
In addition to job applications, other screening-based AI
software provides remote and virtual testing of employees or
records applicant responses to interview questions posed by the
software; in both cases, AI screens the applicants. Pymetrics is a
rm that provides testing to assess cognitive and emotional attributes. Their software is used in initial applicant screening at companies such as JPMorgan Chase & Co., PricewaterhouseCoopers
(PWC), and the Kraft Heinz Company. HireVue is a rm that
records videos of applicants answering interview questions and
then a transcription of the applicant’s responses is analyzed to
make a judgment about the applicant. Both of these screening
hurdles can be used to screen out applicants based on the judgment of computers as opposed to people.
In terms of ethical considerations, the increasing use
of AI has been forecasted to replace jobs in the recruitment
sector. Moreover, in addition to the aforementioned issue with
Amazon’s screening software, there are potential issues with
software that converts interview recordings to text, such as
the software not being able to accurately transcribe some
accents. Further, if the algorithms used in applicant screening
are based on a company’s history, then this can also cause
computers to only screen in similar candidates and perhaps
perpetuate issues related to historical underrepresentation or
lack of diversity. Overall, the companies supplying and using
these AI screening options must ensure that the use of these
programs meets the stringent standards of reliability, validity,
and legal defensibility.
Sources: Andrea Murad, “The Computers Rejecting Your Job Application,” BBC News (8 February, 2021), https://www.bbc.com/news/business-55932977,
accessed May 27, 2021; Jeffrey Dastin, “Amazon Scraps Secret AI Recruiting Tool that Showed Bias Against Women,” Reuters (October 10, 2018); S. Wachter,
B. Mittelstadt, and C. Russell “Why Fairness Cannot Be Automated: Bridging the Gap Between EU Non-Discrimination Law and AI,” Computer Law & Security
Review (March 3, 2020), http://dx.doi.org/10.2139/ssrn.3547922.
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Desp ite the advantages of using ap p lication forms, many managers remain
unclear about the questions they can ask on an ap p lication form. Although most
know they should steer clear of issues such as age, race, marital status, and
sexual orientation, other issues are less clear. In addition to consulting the relevant jurisdiction’s emp loyment laws, some of which are more restrictive than
others, managers should include the following elements when p utting together
an ap p lication form.
●
●
●
●
Applica tion da te. The applicant should date the application. This helps managers
know when the form was completed and gives them an idea of the time limit
(e.g., one year) for keeping the form on le.
Edu ca tion a l ba ckgrou n d. The form should contain information about education attained but not the dates attended because that can be connected with age.
Exper ien ce. Virtually any questions that focus on work experience related to
the job are permissible.
Referen ces. It is both permissible and advisable that the names, addresses,
and phone numbers of references be provided (we will cover this in more
detail later).
Managers should avoid including the following elements when putting together
an application form.
●
●
●
Arrests a n d cr imin a l con viction s. Questions about arrests, convictions, and
criminal records are to be avoided. If bonding is a requirement, the candidate
can be asked whether they are eligible.
Cou n tr y of citizen ship. Such questions are not permitted. It is allowable to
ask whether the person is legally entitled to work in Canada.
Disa bilities. Employers should avoid asking about disabilities or hospitalization
or whether candidates have received workers’ compensation.
Some organizations use what is referred to as a weighted a pplica tion
bla n k (WAB). The WAB involves the use of a common standardized employment application that is designed to distinguish between successful and unsuccessful employees. If managers can identify application items that have predicted
employee success in the past, they may use that information to screen other
applicants. An advantage of this type of application form is that it involves a
more objective and statistical approach to analyzing the information collected in
an application form.
Another type of application form is bioda ta , which collects biographical information about candidates and has been shown to correlate with on-the-job success. Candidates are questioned about events and behaviours that re ect attitudes,
experiences, interests, skills, and abilities. Typically, the questions relate to events
that have occurred in a person’s life and ask what the person typically did in those
situations. The idea is that past behaviour is the best predictor of future behaviour.
For example, a question on a biodata form might ask, “How many books have you
read in the last six months?” or “How often have you put aside tasks to complete
another, more dif cult assignment?” Applicants choose one of several predetermined alternatives to best match their past behaviour and experiences.
A response to a single biodata question is of little value. Rather, the pattern
of responses across several different situations gives biographical data the power
to predict future behaviour on the job. Although biodata has been found to be a
reasonably good predictor of on-the-job success, this type of application form is
sophisticated and must be professionally developed and validated. Another drawback is that the questions might not appear to be clearly related to the job that
is being applied for, so applicants might question the form’s validity and believe
that the form invades their privacy.
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In t e r n e t C h e c k s a n d P h o n e Sc r e e n in g
HR p rofessionals and hiring managers will often “Google” ap p licants’ names
and check their online social networking sites before deciding whether to invite
them for a face-to-face interview. The downside of conducting Internet searches
relates to the p rivacy of app licants as well as the potential for bias and discrimination. It is also dif cult to verify the authenticity of information p osted online
(did the candidate really p ost the information or did someone else?) and easy to
confuse an ap p licant with someone else who has the same name. Concerningly,
even structured evaluations of candidate social media p ages seem to lack the
ability to p redict job p erformance and thus, should not be used in selection
p rocesses.12
Sh ort p h on e in terviews, or screen in g in terviews, are also often con ducted,
many times by HR p erson n el, to n arrow down th e eld an d save man agers
time by elimin atin g can didates wh o are n ot likely to be h ired. However, it
is of con cern th at many of th ese in itial p h on e or screen in g in terviews are
un structured.
Video is being used to p rescreen ap p licants as well. Some software p rograms
allow candidates to interview themselves with their webcams. Asynchronous
job interviews involve question p romp ts that ap p licants receive and are then
required to p rovide a resp onse that is recorded. Of note, these typ es of digitized interviews are p erceived negatively by ap p licants. 13 Managers can quickly
screen through the candidates when they have time before bringing ap p licants
in for a face-to-face interview. To give emp loyers a “p review” of themselves,
candidates are also p osting vid eo r ésu m és on YouTube and other sites. Video
résumés are short video clip s that highlight ap p licants’ quali cations beyond
what they can communicate via their cover letters and résumés. The videos
allow emp loyers to see how well ap p licants p resent themselves and decide
whether they should be called in for an interview. However, there is concern
that video résumés will cause emp loyers to screen p eop le based on their looks
rather than their quali cations.
video résumés
Short video clips that highlight applicants’
quali cations beyond what they can
communicate on their résumé
Em p lo y m e n t In t e r v ie w s
After screening for quali ed candidates, more extensive evaluation of the
remaining candidates occurs through methods such as testing and interviewing.
Traditionally, the emp loyment interview has a central role in the selection p rocess—so much so that it is rare to nd an instance in which an emp loyee is
hired without some sort of interview. 14 Dep ending on the typ e of job, ap p licants may be interviewed by one p erson, members of a work team, or other
individuals in the organization. Although researchers have raised some doubts
about its validity, the interview remains a mainstay of selection because (1) it
is esp ecially p ractical when there are only a small number of ap p licants; (2) it
serves other p urp oses, such as p ublic relations; and (3) interviewers maintain
great faith and con dence in their judgments. Figure 6.4 shows that a number
of ap p licant characteristics and situational factors can in uence the p ercep tions
of interviewers. For examp le, the race and sex of an ap p licant can shap e the
exp ectations, biases, and behaviours of an interviewer, which can in uence
the interview outcome. Even a limited understanding of the variables shown in
Figure 6.4 and p eriodic training have been shown to imp rove the effectiveness
of interviewers. 15
In this section, we review the structure of the interview, the types of structured interviews, methods for administering interviews, and guidelines for
employment interviewers.
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F ig u r e 6 .4
Variab le s in the Em p lo ym e nt Inte rvie w
CONTEXT
APPLICANT
KSAOs
Education
Experience
Interests
Perceptions
Nonverbal cues
Demographic
characteristics
Purpose of the
interview
Laws and regulations
Economic issues
Physical settings
Interview structure
INTERVIEW
Process
INTERVIEWER(S)
Experience/ training
Demographic
characteristics
Perceptions
Nonverbal cues
Goals
Outcome
(Hiring Decision)
Th e St r u c t u r e o f In t e r v ie w s
N o n d ir e c t iv e In t e r v ie w s
nondirective interview
An interview in which the applicant is
allowed the maximum amount of freedom
in determining the course of the discussion,
while the interviewer carefully refrains from
in uencing the applicant’s remarks
structured interview
An interview in which a set of standardized
questions with an established set of answers
is used
In the n on d ir ective in ter view (also referred to as the u n str u ctu red in ter view),
the interviewer carefully refrains from in uencing the applicant’s remarks. The
interviewer asks broad, open-ended questions—such as “Tell me more about your
experiences on your last job” or “What are your strengths and weaknesses?”—and
permits the applicant to talk freely with a minimum amount of interruption. The
greater freedom afforded to the applicant in the nondirective interview helps
bring to the interviewer’s attention any information, attitudes, or feelings a candidate might not disclose during more structured questioning. However, because
the applicant determines the course of the interview and no set procedure is followed, little information that comes from these interviews enables interviewers to
cross-check agreement with other interviewers. Thus, the reliability and validity
of these interviews are not likely to be optimal and, as a result of this, there is a
need to conduct more structured employment interviews.16
St r u c t u r e d In t e r v ie w s
Because a str u ctu r ed in ter view has a set of standardized questions (based on
job analysis) and an established set of answers against which applicant responses
can be rated, it provides a more consistent basis for evaluating job candidates.
The responses from candidates are rated on a behaviourally anchored rating
scale, and the interviewers also take notes. A structured interview is more
likely to provide the type of information needed for making sound decisions.
Structured interviews are much more likely to predict on-the-job performance
than nondirective interviews.17 Structured interviews are also less likely than
nondirective interviews to be discriminatory and attacked in court.18
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It is also worth noting that interviews can be semi-structured in that they
contain a mixture of structured and unstructured elements; however, if the
organization’s goal is to maximize the effectiveness of their hiring process, then
they should use fully structured interviews.
Ty p e s o f St r u c t u r e d In t e r v ie w s
Situatio nal Inte rvie w s
One typ e of structured interview is called the situ ation al in ter view . With this
ap p roach, an ap p licant is given a hypothetica l incident and asked how they
would resp ond to it. The ap p licant’s resp onse is then evaluated relative to p reestablished benchmark standards, such as the typ e of information that can
be identi ed through the critical incident method of job analysis (Chap ter 4).
Highlights in HRM 6.1 shows a samp le question from a situational interview
used to select systems analysts.
situational interview
An interview in which an applicant is given
a hypothetical incident and asked how they
would respond to it
Highlights in HRM 6.1
Sam p le Situatio nal Inte rvie w Que stio n
Question:
It is the night before your scheduled vacation, which you had booked off several weeks ago and had received approval from
your manager. You are packed and ready to go and are planning to be out of the country for two weeks with no access to
email, phone, or text. Just as you are getting ready for bed, you receive a phone call from your manager. There is a problem
that has arisen with the IT system that you are responsible for. You are asked to address this issue. What would you do in this
situation?
Record Answer:
Scoring Guide:
Level 1: I would suggest that the manager contact one of my colleagues who can try to address the issue. I would provide my
manager with the name and contact information for the IT system vendor so that they can try to troubleshoot the issue.
Level 3: I would leave detailed instructions for one of my colleagues so that they could troubleshoot the issue themselves the next
morning. I would ask them to go in early and see if this issue can be addressed and I would let them know that I would be available
until my plane boarding to try to help further.
Level 5: I would go in to work right away and make sure that the system was xed. If needed, I would work through the night or
take a later ight or delay my vacation to ensure that everything is fully operational before I leave.
Rating: __________________
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suggest that if the p anels are comp osed of a diverse group of interviewers,
hiring discrimination is minimized.19 Ap p licants are also more likely to accep t
decisions made by p anels.
A seq u en tial in ter view is one in which a candidate is interviewed by
multip le p eop le, one right after another. Th ey allow different interviewers
who have a vested interest in the candidate’s success to meet and evaluate the
p erson one-on-one. Th e interviewers can later get together and comp are their
assessment of the candidates.
Most interviews take place in person. However, they can be administered in
other ways to broaden the talent pool and make interviewing easier, faster, and
less costly. These alternatives to in-person interviewing are especially helpful for
candidates who are geographically dispersed as well as during unique situations,
such as the COVID-19 pandemic.
sequential interview
A format in which a candidate is interviewed
by multiple people, one right after another
The Business Case
B e h a v io u r a l In t e r v ie w s B r in g B ig Re t u r n s
Fairmont Hotels and Resorts Inc., with nearly 30,000
employees at over 70 hotels in 27 countries, measures the
effectiveness of selection tools. Using a Gallup selection tool,
Fairmont has tracked the performance of sales personnel by
selecting those who matched the characteristics of the best
performers. Those superior employees produce two to three
times more revenue than others.
A nancial organization decided to assess the return on
investment (ROI) of competency-based behavioural interviewing. It focused rst on the sales and marketing function,
which employed about 100 people, with average annual salaries of $135,000 ($90,000 plus a variable bonus of 50 percent
for on-target performance). Turnover was about 20 percent a
year. The statistical concept of a normal distribution suggests
that the output of a group of workers forms a bell-shaped
distribution, resulting in a small portion (about 10 percent) of
staff working above or below acceptable performance, whereas
the majority are working in the acceptable range. The recruiters
decided to delineate the competencies that differentiated
superior performers from average performers and to use these
to improve the selection procedure.
Here is how the ROI was calculated:
Under the new system, all 20 would be superior, for a
net increase of 18 new superior employees.
Performing above average is worth about 48 percent
of the average annual salary to the company.
Therefore, 18 × ($135,000 × 0.48) = $1,166,400.
But the recruitment process is not perfect and so
must be discounted by 0.545 (the consultants’ estimate of how good they were at selecting superior
candidates and rejecting inferior candidates).
Therefore, 0.545 × $1,166,400 = $635,688.
The cost of the competency project for sales and
marketing was $130,000.
The bene t was $635,688, for an ROI of 489 percent.
The long-term ROI may be higher as superior recruits may
have lower turnover, shorter learning curves, and increasingly
effective performance.
Interviews must be as valid as tests because they are
so expensive. The average cost per hire of an executive is
$43,000, a manager or professional $17,000, a technical
person $13,000, and clerical and administrative support
around $3,000.
Assume 20 new recruits a year.
Two recruits, on average, would be superior performers
under the current recruiting system.
Sources: Adapted from A. Davis, “What Is the Cost of Hiring?” Canadian HR Reporter 16, no. 11 (June 2, 2003): 12; T. Tritch, “Fairmont’s Talent Strategy Delivers
Results,” Gallup Management Journal (May 13, 2003), http://www.gmj.gallup.com; Lionel LaRoche and Stephen Martin, “Demonstrating the Bottom-Line Impact
of HR: A Competencies Case Study,” Canadian HR Reporter 13, no. 22 (December 18, 2000): 29–31.
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Thais Ceneviva/ E+Getty Images
In this panel interview, the interviewee
is connecting by videoconference.
Vid e o and Pho ne Inte rvie w s
video interviews
Interviews conducted via videoconferencing
or over theWeb
computer-administered
(automated) interview
Interview in which the questions are
administered to applicants via computers;
the interview can be conducted at a rm’s
facilities, using kiosks, online, or via phone
Many companies are conducting vid eo in ter view s via webcams and services
such as Skype.20 Video interviews are attractive because of their convenience and
low cost and because they make it easier to interview people in different geographic areas, thereby expanding the talent pool. However, some research has
found that candidates interviewed via video come across as less likable.21 Some
candidates may be more comfortable on camera or using the technology than
other candidates and some might not have access to the required technology.
Phone interviews can be effective and can help expand a company’s pool
of talent as well. Via phone, Paci c Islands Club, a resort in Guam, is able to
recruit people from around the world who want to work for the resort. Rebecca
Cummings, a young professional living in the United States, went to work for the
Paci c Islands Club as an activities director after successfully interviewing via
phone. A face-to-face interview would have been cost prohibitive.22
Co m p ute r- Ad m iniste re d (Auto m ate d ) Inte rvie w s
Nike, Cigna Insurance, and Pinkerton Security are among the many companies
that have used computer-assisted, or automated, interviews to gather information as well as compare candidates. In a com p u ter -ad m in ister ed (au tom ated )
in ter view , the questions are administered to applicants via a computer. The interviews can be conducted at a rm’s facilities, using kiosks, online, or via phone.
Applicants are invited to interview by email, given passwords to log on to the
sites, and then given questions to answer, which are then recorded and sent to
the hiring rm. Managers can then watch the interviews at their convenience.
A drawback is that they can’t ask candidates follow-up probing questions based
on their answers. These asynchronous video interviews are generally perceived
less favourably by applicants than synchronous video interviews.23 Consequently,
organizations have used automated interviews mainly as a complement to, rather
than as a replacement for, live interviews.24 Highlights in HRM 6.2 lists some of
the most common job interview questions.
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Highlights in HRM 6.2
Surve y Says! To p 10 M o st Po p ular Inte rvie w Que stio ns
“Tell me about yourself” is the most popular interview question
based on a survey of hiring professionals. Recruiters often use
this question as well as others from the below list; but the real
questions is: are any of these questions likely to be reliable,
valid, and legally defensible?
●
●
“Tell me about a challenge or con ict you faced at work,
and how did you deal with it?”
“What are your greatest strengths?”
●
“How did you hear about this position?”
●
“What are your greatest weaknesses?”
●
“Tell me about a time you demonstrated leadership
skills.”
●
“Why are you leaving your current position?”
●
“Tell me about a time you made a mistake.”
●
“What type of work environment do you prefer?”
●
“How would your boss and coworkers describe you?”
Source: Adapted from Mark Rosanes, “What Are the Most Popular Interview Questions?” Canadian HR Reporter (February 26, 2021).
G u id e lin e s fo r Em p lo y m e n t In t e r v ie w e r s
Apart from the characteristics of structured interviews themselves (e.g., ensuring
the questions are all job-related, asking all candidates the same questions, evaluating the candidate responses using a scoring guide), there are several additional
recommendations for interviewers. Organizations should be careful in selecting
employment interviewers. Given the importance of diversity in the workforce,
it is important that interviewers value equity, diversity, and inclusion as well as
have a thorough understanding and awareness of the legal obligations that need
to be ful lled when conducting employment interviews.
Inte rvie w e r B e st Prac tic e s
Training can also help to improve the competence of interviewers. If not done
on a continuing basis, training should at least be done periodically for managers,
supervisors, and HR representatives who conduct interviews. Interviewer training
programs should include practice interviews conducted under guidance. Practice
interviews may be recorded and evaluated later in a group training session. The
following list presents 10 ground rules for employment interviews that are commonly accepted and supported by research ndings. Their apparent simplicity
should not lead one to underestimate their importance.
1. Un der sta n d the job. Perhaps the most critical step to ensuring that
interviewers do a good job is to be sure they understand the job and its
requirements. Interviewers who understand the parameters of a job will be
better at interviewing people and evaluating their responses.
2. Esta blish a n in ter view pla n . Examine the purposes of the interview and
determine the areas and speci c questions to be covered in advance of the
interview. Review the job requirements before seeing the applicant.
3. Esta blish a n d ma in ta in ra ppor t a n d listen a ctively. This is accomplished by
greeting the applicant pleasantly, explaining the purpose of the interview,
displaying sincere interest in the applicant, and listening carefully.
However, care must be taken to not delve into unrelated and potentially
prohibited topics.
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4. Pr ovide in for ma tion a s freely a n d hon estly a s possible. Answer fully and
frankly the applicant’s questions. Present a realistic picture of the job.
5. Use qu estion s effectively. Ask situational and behavioural questions. Do not
ask questions that “lead” candidates to the “right” answer.
6. Sepa ra te fa cts fr om in feren ces. During the interview, record factual
information. Rate the applicant’s response after they nish answering each
question. Sum your ratings across the questions at the end of the interview.
Compare your ratings to those of the other interviewers.
7. Recogn ize bia ses a n d stereotypes. Stereotyping involves forming generalized
opinions of how people of a given gender, race, or ethnic background
appear, think, feel, and act. One typical bias is for interviewers to consider
candidates who have interests, experiences, and backgrounds similar to
their own to be more acceptable. Another bias occurs when interviewers
subconsciously contrast an applicant to the applicant that preceded them;
for example, an average applicant is likely to appear stronger if their
interview follows that of a below-average applicant.
8. Avoid the “ha lo err or,” or ju dgin g a n in dividu a l fa vou ra bly or
u n fa vou ra bly overa ll on the ba sis of on ly on e str on g poin t on which you
pla ce high va lu e. Also avoid the in uence of “beautyism.” Discrimination
against unattractive but talented people is a persistent and pervasive form
of employment discrimination.
9. Con tr ol the cou r se of the in ter view. Establish an interview plan and stick
to it. Provide the applicant with ample opportunity to respond to the
interview questions but maintain control of the situation to reach the
interview objectives.
10. Sta n da rdize the qu estion s a sked. To increase the reliability of the interview
and avoid discrimination, ask the same questions of all applicants for a
particular job. Keep careful notes of what the applicants actually said.
A r e Yo u r Q u e s t io n s L e g a l?
The entire subject of preemployment questioning is complex. Federal and
provincial/ territorial requirements sometimes vary in the types of questions that
may be asked during the interview. However, all jurisdictions forbid direct questions about race, sex, age, religion, marital status, physical or mental disability, and
sexual orientation and most look with disapproval on indirect questions dealing
with the same topics. Some of the questions that interviewers once felt free to
ask can potentially be hazardous. It is inappropriate, for example, to ask, “Who
will take care of your children while you are at work?” or “Do you plan to have
children?” or “What is your husband’s occupation?” or “Are you engaged?” It is, in
fact, inappropriate to ask applicants of either gender questions about matters that
have no relevance to job performance.
Human rights commissions have severely limited the areas of questioning.
In general, if the question is job-related, is asked of everyone, and does not discriminate against protected applicants, it is likely to be legally acceptable. It is
advisable to provide interviewers with instructions on how to avoid potentially
discriminatory questions in their interviews. The examples of appropriate and
inappropriate questions shown in Highlights in HRM 6.3 may serve as guidelines
for application forms and preemployment interviews. Complete guidelines may
be developed from current information available from the relevant jurisdiction’s
human rights commission.
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Highlights in HRM 6.3
Ap p ro p riate and Inap p ro p riate Inte rvie w Que stio ns
Subject
Avoid Asking
Name
●
about a name change; whether it was changed
by court order, marriage, or other reason
Preferred
ask after selection if needed to check on
previously held jobs or educational credentials
●
maiden name
Address
●
for addresses outside Canada
ask place and duration of current or recent
address
Age
●
for birth certi cates, baptismal records, or
about age in general
Ask applicants whether they are eligible to work
under Canadian laws regarding age restrictions.
Sex
●
males or females to ll in different applications
can ask applicant whether the attendance
requirements can be met
●
Marital status
Family status
National or ethnic
origin
●
about pregnancy, child-bearing plans, or
childcare arrangements
whether the applicant is single, married,
divorced, engaged, separated, widowed, or
living common-law
●
whether the applicant’s spouse will be transferred
●
about the spouse’s employment
●
number of children or dependants
●
about childcare arrangements
●
about birthplace, or nationality of ancestors,
spouse, or other relatives
If transfer or travel is part of the job, the
applicant can be asked whether they can meet
these requirements; ask whether there are any
circumstances that might prevent completion of
a minimum service commitment.
can ask whether the applicant would be
able to work the required hours and, where
applicable, overtime
Since those who are entitled to work in
Canada must be citizens, permanent
residents, or holders of valid work permits,
applicants can be asked whether they are legally
entitled to work in Canada.
●
whether born in Canada
●
for proof of citizenship
Military service
●
about military service in other countries
Inquire about Canadian military service
where employment preference is given to
veterans by law.
Language
●
mother tongue
●
where language skills obtained
Ask whether applicant understands, reads, writes,
or speaks languages required for the job.
Race
●
Photos
●
Religion
●
Height and weight
●
any question about race, including colour of
eyes, skin, or hair
for photo to be attached to applications or sent
to interviewer before interview
about religious af liation, church membership,
frequency of church attendance, whether
applicant will work a speci c religious holiday,
or for references from clergy or religious leader
Explain the required work shift, asking whether
such a schedule poses problems
for the applicant.
no inquiry unless there is evidence they are
genuine occupational requirements
(Continued )
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Subject
Avoid Asking
Disability
●
●
●
●
Medical information
●
Pardoned conviction
●
Sexual orientation
●
References
●
for listing of all disabilities, limitations, or health
problems
whether applicant drinks or uses drugs
whether applicant has ever received psychiatric
care or been hospitalized for emotional problems
whether applicant has received workers’
compensation
Preferred
employer should disclose any information on
medically related requirements or
standards early in the application process, then
ask whether the applicant has any
condition that could affect their ability to do the
job, preferably during a preemployment medical
examination
whether currently under physician’s care, name
of family doctor, whether receiving counselling
or therapy
whether an applicant has ever been convicted,
has ever been arrested, or has a criminal record
if bonding is a job requirement, ask whether applicant is eligible
about the applicant’s sexual orientation
the same restrictions that apply to questions
asked of applicants apply when asking for
employment references
Source: From Canadian Human Rights Commission, “AGuide to Screening and Selection in Employment,” online at http://www.ccdp.gc.ca/sites/default/ les/
screen_1.pdf. Reprinted by permission of the Canadian Human Rights Commission.
P o s t - In t e r v ie w Sc r e e n in g
Usually after the interview has been successfully completed, information about previous employment and other information provided by the applicant is investigated.
Re fe r e n c e C h e c k s
The most reliable information usually comes from previous supervisors, who are
in the best position to report on an applicant’s work performance. Written veri cation of information relating to job titles, duties, and pay levels from the former
employer’s HR of ce is also very helpful. Organizations can check the references
of employees in a number of ways. Generally, telephone checks are preferable
because they save time for the reference provider and provide for greater candour.
Highlights in HRM 6.4 include a list of helpful questions to ask about applicants
when checking their references.25
As a legal protection for all concerned, it is impotant to ask the applicant to complete forms permitting information to be solicited from former employers and other
reference sources. Many employers will verify only former employees’ employment
dates and positions. A survey by SHRM found that although 75 percent of companies
do provide references, many reported that the information consists only of employment dates and positions. This results in problems for the next employer. A survey of
Canadian companies found that the majority had to terminate an employee for reasons that could have been discovered through a reference check. For example, the
City of Waterloo red its chief administrative of cer after it uncovered an employment
history in which the hired candidate broke rules and misled his previous employer,
all well publicized, but not checked by either the recruiting rm the city.26 Despite
their reluctance, organizations should feel free to evaluate their former employees
because they cannot be sued by those former employees so long as the information
provided is accurate—the legal concept of “quali ed privilege” protects employers
from defamation lawsuits.
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Highlights in HRM 6.4
Sam p le Re fe re nc e Che c k Que stio ns
●
●
●
What is your relationship to the applicant? Are you the
person’s supervisor, peer, or subordinate?
What were the start and end dates of the applicant’s
employment?
What was the applicant’s title?
●
What were the applicant’s job responsibilities?
●
In what areas did the applicant excel?
●
●
●
In what areas did the applicant need improvement?
What was the applicant’s biggest accomplishment at your
organization?
●
How does the applicant deal with con icts and stress?
●
To what extent is the applicant driven to succeed?
●
Did the applicant miss a lot of work?
●
Was the applicant punctual?
●
For what reason did the applicant leave your organization?
●
Would you rehire the applicant?
●
●
Are there any serious problems with the applicant we
should know about?
Is there any additional information about the applicant you
would like to share with me?
How well does the applicant communicate with and get
along with others?
Sources: “Four Reasons Why You Should Always Check References,” Human Resources Today (December 29, 2015), http://www.humanresourcestoday.com;
Alison Doyle, “Reference Check Questions,” About.com, http://www.about.com, accessed March 24, 2011; Carolyn Hirschman, “TheWholeTruth,” HRMagazine
45, no. 6 (June 2000): 86–72.
Bac kg round Chec ks
Background investigations have become standard procedure for many companies to try to prevent a variety of problems ranging from embezzlement and theft
of merchandise to workplace violence. The vast majority (over 90 percent) of
Canadian companies surveyed by the Ca n a dia n HR Repor ter indicated that they
conduct background checks for previous employment history (92 percent), academic quali cations (53 percent), criminal record (50 percent), and credit rating
(11 percent).27
Like the application process, many checks that were once done manually
are now being done online using existing computer databases; however, this frequently requires checking many different databases. Information on international
applicants is even more dif cult to obtain. Some companies outsource some or
all of the checks to third-party screeners.
Some job boards now have online screening tools allowing an applicant to
conduct their own self-background check and post it online prior to any sort of
interview. The idea is to demonstrate upfront to prospective employers that the
applicant has a clean criminal record and a good job history and would make a
good employee.28
Finally, an increasing number of companies are simply using Internet searches
to uncover background information on potential candidates through social networking sites such as Facebook. However, if the candidate is not hired for the
job and learns that the employer checked their social media sites, and perhaps
learned that the candidate is a member of a designated group, then the candidate
could potentially le a human rights claim.
C r e d it C h e c k s
The use of consumer credit reports by employers as a basis for establishing an
applicant’s eligibility for employment has become more restricted. For positions
of trust, such as those involving nancial responsibility or perhaps in positions
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such as chief nancial of cer, credit reports can be argued to be a bona de
occupational requirement. However, applicants must agree in writing to a credit
report and have the right to review its contents. More importantly, the reason for
the credit report must be job-related.
Check In
Many employers conduct Internet searches (e.g., general Web searches, searching social media
sites) to discover information about job candidates. Can you see any problems related to this?
Learning Outcome 3
Compare the value of different types of
selection tests and how their validity can be
demonstrated.
preemployment test
An objective and standardized measure that
is used to gauge a person’s knowledge,
skills, abilities, and other characteristics
(KSAOs) relative to other individuals
P r e e m p lo y m e n t Te s t s
A p r eem p loym en t test is an objective and standardized measure that is used
to gauge a p erson’s KSAOs relative to other individuals. There are many selection tests that can accurately p redict the future job p erformance of ap p licants.
However, one of the drawbacks of p reemp loyment testing is that it can create
the p otential for legal challenges if the tests being used are discriminatory or
not job-related. Thus, managers must have an understanding of the technical
asp ects of testing and the contributions that tests can make to the selection of
ap p licants. Managers should also conduct a thorough job analysis to determine
the crucial job requirements and related skills that need to be tested for and
eliminate any unnecessary or dup licate tests. Overall, selection testing, if done
right, should be included as a comp lement to the structured emp loyment interview in all selection p rocesses.
Ty p e s o f Te s t s
Jo b Kno w le d g e Te sts
Government agencies and licensing boards usually develop job knowledge tests,
a type of achievement test designed to measure a person’s level of understanding
about a particular job. The Uniform CPA Examination used to license certi ed
public accountants is one such test and, in Ontario, the Comprehensive Knowledge
Exams used to certify designed HR professionals is another example. Overall, job
knowledge tests can be used to determine whether an applicant possesses the
information and understanding that will permit placement in the job without further training and have been found to be predictive of job performance.29
W o rk Sam p le Te sts
Work sample tests, or job sample tests, require the applicant to perform tasks
that are part of the work required on the job. Like job knowledge tests, work
sample tests are constructed from a carefully developed outline that experts
agree includes the major job functions; the tests are thus considered content valid
(see later in this chapter for a discussion of this and other validation strategies).
Organizations that are interested in moving toward competen cy-ba sed selection —
that is, hiring based on an observation of behaviours previously shown to distinguish successful employees—increasingly use work samples to see potential
employees “in action.”30
Work samples have been devised for many diverse jobs: a map-reading test
for traf c control of cers, an Excel test for administrative assistants, a complex
coordination test for pilots, a case analysis and presentation for management
consultants, and a programming test for coders, to name a few. The evidence
indicates that this type of test is cost effective, reliable, valid, fair, and acceptable
to applicants.31
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Related to the work sample test is the job simulation. Prudential Grand Valley
Realty, a real estate rm in Kitchener, Ontario, uses an online video-based assessment that simulates the job of a real estate agent. The candidate plays the role of
an agent and interacts with virtual clients who are interested in buying or selling
a property. The recruit is taken through the entire sales cycle, from building rapport to closing the deal, and must demonstrate the ability to handle objections,
negotiate price, understand client needs, and handle periodic rejection.32
Co g nitive Ab ility Te sts
Cognitive ability tests measure mental capabilities such as general intelligence,
verbal uency, numerical ability, and reasoning ability. A host of paper-and-pencil
(or electronically administered) tests measure cognitive abilities, including the
General Aptitude Test Battery (GATB), Scholastic Aptitude Test (SAT), Graduate
Management Aptitude Test (GMAT), and Graduate Record Examination (GRE).
Figure 6.5 provides example questions from the General Competency Test (GCT)
administered by the Public Service Commission of Canada.
F ig u r e 6 .5
Ge ne ral Co m p e te nc y Te st (GCT) Le ve l 1
Type I—Understanding Written Material
This type of question involves reading a short passage, which
is usually in memorandum format, and answering a question
about the information in the text.
Question 1
Government of Canada
Memorandum
TO: All employees
a heavy workload, an employee had to do 35 hours of
overtime in 2 weeks. Seven of these hours are at “double
time” (i.e., twice usual pay), the rest are at “time-and-a-half.”
The employee’s usual pay is $375 a week at $10 an hour.
How much overtime money should the employee be paid for
the two-week period?
1. $340
3. $560
2. $420
4. $760
FROM: Manager
Type III—Drawing Logical Conclusions
We are pleased to announce that our Ministry’s budget has
been increased and consequently we will experience an
increase in staff size. Because new positions will become
available, we will be holding interviews within the next few
weeks.
In this type of question, the task is to choose the correct
answer to a practical problem.
The main purpose of this memorandum is a change
concerning
1. better ministerial policy
3. more human resources
2. better budget publicity
4. more of ce space
Question 3
One of your duties is the selection and disposal of boxes of
obsolete les. According to regulations, ordinary les become
obsolete after 24 months, con dential les after 36 months,
and classi ed les after 48 months. Which of the following
boxes of les can be disposed of?
Type II—Solving Numerical Problems
A) A box containing ordinary les dated 26 months ago and
classi ed les dated 34 months ago
This type of question involves choosing the correct answer to a
practical numerical problem.
B) A box containing ordinary les dated 38 months ago and
con dential les dated 28 months ago
Question 2
You are in charge of nancial services and must calculate overtime pay for employees in your division. Due to
1. Aonly
3. both A and B
2. B only
4. neither A nor B
Answers can be found on page 255.
Source: Reproduced with the permission of the Public Service Commission of Canada, 2018.
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iStock.com/ rez-art
With jobs such as this one that require
speci c skills, it is quite common for
employers to ask candidates to demonstrate their abilities through work
sample tests.
Although cognitive ability tests can be developed to measure very specialized
areas, such as reading comprehension and spatial relations, many experts believe
that the validity of cognitive ability tests simply re ects their connection to general intelligence. Further, measures of general intelligence (such as IQ) have been
shown to be robust predictors of performance across a wide variety of jobs.33
Many practitioners are becoming interested in the concept of emotion a l intelligence, which is predictive of job performance;34 however, general intelligence
remains a stronger predictor.
The GCT was developed by the Personnel Psychology Centre, Assessment,
Testing and Counselling Directorate, the Public Service Commission of Canada.
The GCT 1 has 50 multiple-choice questions, and the test takes 85 minutes. There
are three types of questions, and a sample of each type is found in Figure 6.5.
Pe rso nality and Inte re st Inve nto rie s
Whereas cognitive ability tests measure a person’s intellectual capability,
personality tests measure disposition and temperament. Although cognitive ability
tests are the better predictor of how well employees can acquire job knowledge
and, ultimately, perform their job, personality tests can also be predictive of job
performance.35 Further, personality tests can be better predictors of employee
motivation, such as their leadership efforts and propensity to adhere to rules. Five
dimensions have been shown to reliably summarize personality traits. The “Big
Five” factors are the following:
1. Extraversion—the degree to which someone is talkative, sociable, active,
and excitable
2. Agreeableness—the degree to which someone is trusting, friendly,
generous, tolerant, cooperative, and exible
3. Conscientiousness—the degree to which someone is dependable and
organized and perseveres in tasks
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4. Emotional stability—the degree to which someone is secure, calm,
independent, and autonomous
5. Openness to experience—the degree to which someone is intellectual,
philosophical, insightful, creative, artistic, and curious 36
One extension to th e Big Five is th e inclusion of th e dimension of h onesty–
h umility, wh ich re ects sincerity, fairness, greed avoidance, and modesty. 37
In Canada, th e Mars One mission h as th e goal of establish ing a p ermanent
settlement on Mars, and h undreds of th ousands of p eop le h ave ap p lied to
be p art of th e crew. To assess th ese candidates, a p ersonality test measuring
ch aracteristics such as resiliency, curiosity, and adap tability was develop ed to
select 75 Canadians, as well as about 1,000 oth ers, for th e second round of
tests. 38
One potential issue with personality testing is that of fa ka bility, which means
that applicants can fake or give answers to questions that don’t necessarily re ect
their true personality.39 Another potential issue is the relatively low connection
between personality testing and job performance for many personality dimensions.40
However, personality testing (especially the dimension of conscientiousness) can be
predictive of job performance and tends to not have adverse impact or subgroup
differences.
Po lyg rap h Te sts
The polygraph, or lie detector, is a device that measures physiological changes
in breathing, blood pressure, and the pulse of a person who is being questioned.
Questions typically cover items such as whether a person uses drugs, has stolen
from an employer, or has committed a serious, undetected crime.
Th e Royal Canadian Mounted Police (RCMP) uses a p olygrap h test to identify candidates who meet its standards of honesty and suitability. However,
the use of lie detector tests for emp loyment p urp oses is p rohibited under the
emp loyment standards acts in both Ontario and New Brunswick. Emp loyers
must check relevant jurisdictional legislation before considering the use of a
p olygrap h. A lack of reliability in p olygrap h tests as well as negative ap p licant
reactions are also imp ortant reasons why p olygrap h testing should be avoided
in selection.
H o ne sty and Inte g rity Te sts
Honesty and integrity tests may be especially helpful in settings such as retail
stores, where employees have access to cash or merchandise. Common areas of
inquiry include beliefs about the frequency and extent of theft in society, punishment for theft, and perceived ease of theft. For example, Payless ShoeSource has
used a paper-and-pencil honesty test to reduce employee theft. When the company
began its program, losses totalled nearly $21 million per year among its 4,700
stores. Within only 1 year of implementing its selection program, inventory theft
fell by 20 percent to less than 1 percent of sales.41
In general, honesty tests are good predictors of job performance and are
an excellent complement to cognitive ability tests because they add predictive
ability beyond that of cognitive ability and do not have problematic differences
in scores for protected group members. Nonetheless, some have questioned their
validity42 and it is possible that the tests “work” not because they predict behaviour but because they deter less-than-honest applicants from joining a company.
An additional concern is that applicants sometimes view more over t integrity
tests as an invasion of their privacy. Some candidates nd questions such as
“I have stolen from a previous employer” or “I have been tempted to steal from
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a previous employer” offensive. HRM specialists should consider the use of more
cover t honesty tests (which would include questions such as “I think that I am
entitled to more respect than the average person is” or “Having a lot of money is
not especially important to me”) and, of course, use honesty and integrity tests
in conjunction with other sources of selection information.43
Physic al Ab ility Te sts
In addition to learning about a job candidate’s mental capabilities, employers
sometimes need to assess a person’s physical abilities. Particularly for demanding
and potentially dangerous jobs, such as those held by re ghters and police
of cers, physical abilities (e.g., strength, endurance) tend to be associated with
increased performance and decreased accidents and injuries.44
Physical ability tests must be used cautiously. In the p ast, requirements for
p hysical characteristics such as strength, agility, height, and weight were often
determined by an emp loyer’s subjective notion of what should be required. This
often puts ap p licants from some p rotected group s at a disadvantage, a situation
that can lead to lawsuits. One landmark case occurred in British Columbia where
a female re ghter who was adequately p erforming her job was terminated from
her job for failing a newly imp osed physical ability test. This test clearly didn’t
identify the minimum standards required for p erforming this job because the
employee had been successfully p erforming her job up to that p oint. These are
the types of issues that can occur when prop er p rocedures are not followed for
creating p hysical ability test standards. In this case, the Sup reme Court of Canada
ruled that discrimination had occurred and that this emp loyee had been wrongfully dismissed from her job.45 It is clear that the standards for p hysical ability
tests should be carefully determined on the basis of the essential functions of the
job with a rep resentative and diverse group of emp loyees.
M e d ic al Exam inatio ns
A medical examination is generally given to assess the health of applicants; these
exams also provide a baseline against which subsequent medical results can
be compared and interpreted, which is especially important for determining
work-caused disabilities under workers’ compensation law. However, it is a relatively rare situation when a medical examination is a job-related requirement.
An example of an exception where this type of exam can be required would be
for a deep-sea diver as an underlying medical issue could prove to be fatal for
someone in this type of job.
Medical examinations and inquiries about a candidate directed to medical
professionals can be conducted only after an offer (preferably written) of employment has been made. The offer can be made conditional on the applicant’s ability
to perform the essential duties of the job as determined by a job-related medical
examination. This allows the applicant with a medical issue the opportunity to
be considered exclusively on merit during the selection process. Any medical
inquiries must be directly related to assessing the candidate’s abilities to perform
the essential duties of the job.
In the selection p rocess, an emp loyer may ask a candidate if they have
any disability-related needs that would require accommodation to enable p erformance of the essential duties of the job. However, the interviewer should
be cautioned about p robing as to the nature of the disability, otherwise, later
employment-related decisions may be p erceived to be based on this information
and thereby characterized as discriminatory. Sp eci c to medical examinations, to
ensure neutrality, and to avoid the p ossibility of a human rights comp laint, such
information should remain exclusively with the examining p hysician, not in the
p ersonnel le.
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If the employee has a disability, the employer has a duty to accommodate
their needs. The accommodation can be accomplished either by modifying some
of the essential duties of the position or by providing required equipment. To
determine whether an individual can perform the essential duties of a particular
position, the employer should conduct a physical demands analysis, checklists
for which are available, for example, through provincial ministries of labour.
Drug Te sting
The Canadian Human Rights Commission and some of its provincial counterparts
have issued policies on employment-related drug testing. Addiction to drugs or
alcohol is legally considered to be a disability and thus, the employer is to be guided
by legislation and by practices such as workplace accommodation. Because drug
tests measure neither actual impairment nor the likelihood of a person reporting
to work under the in uence of drugs, the extent to which they assess the ability
to perform essential duties is extremely limited. Therefore, human rights tribunals
and courts have imposed very strict limitations on the right of employers to require
drug tests.46 Further, it is also common for “false positives” to occur—that is, for
a test to mistakenly show that someone has used illegal drugs when they haven’t.
For example, over-the-counter drugs can lead to false positives.
If the job is a safety-sensitive one, then an employer may be permitted to
offer the position conditional on the successful passing of a drug test. However,
if an employee who fails a drug test is a drug addict, and therefore disabled
under human rights statutes, then the employer will be required to accommodate
the employee’s disability to the point of undue hardship (i.e., when the expense
becomes prohibitive for the employer or when the accommodation causes other
health and safety issues) before they can dismiss the employee. Overall, it is difcult to demonstrate how drug testing makes the workplace safer or leads to
improvements in the performance of workers except for highly safety-sensitive
jobs where this can be argued to be a job-related requirement (e.g., transport
truck drivers).
There is widespread opposition to drug testing in the workplace, which is
why only about 2 percent of companies in Canada do it compared to about
80 percent of American companies. Canadian companies that operate in both
countries, such as those in cross-border trucking, may argue that testing is a
bona de occupational requirement for drivers because they would otherwise
be banned from driving in the United States. As an additional example, Syncor
Canada, a world leader in mining and extracting crude oil, has argued that drug
testing of heavy equipment operators, but not for those in an of ce environment,
is justi ed on safety grounds. Overall, despite differing opinions on the matter,
drug and alcohol addiction is considered to be a disability in Canada that must be
accommodated for; employee assistance programs (EAPs) play an important role
in helping employees with drug and alcohol problems. EAPs will be discussed
in Chapter 11.
Asse ssm e nt Ce ntre s
Assessm en t cen tr es are used to evaluate candidates, often as a group, as they
participate in a series of simulations that resemble what they might encounter
on the job. The assessment centre is not a single test but is rather a combination of different selection tests as well as interviews. Some assessment centres,
where the tests are professionally conducted, take a “day in the life of” approach.
Candidates “report to work” at the assessment centre and receive the usual steady
diet of emails and other interruptions; meet with various role players who play
different employees, clients, and managers; and handle manufactured events
while they are observed and recorded.47 At the end of the assessment centre
period, the assessors’ observations are combined to develop a comprehensive
assessment centres
Aprocess by which individuals are
evaluated as they participate in a series of
situations that resemble what they might
encounter on the job
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report of the strengths and needs of the participants. A report is normally submitted to the organization that commissioned the tests, and feedback is given to
the participants. Because of the costs involved, assessment centres are usually
used to select higher-level employees, such as managers.
D e t e r m in in g t h e Va lid it y o f Te s t s
There are three recognized approaches to validation: criterion-related validity,
content validity, and construct validity. All three approaches are helpful in proving
that selection methods are valid.
Crite rio n- Re late d Valid ity
criterion-related validity
The extent to which a selection tool predicts,
or signi cantly correlates with, important
elements of work behaviour
concurrent validity
The extent to which test scores (or other
predictor information) correlate with criterion data obtained at about the same time
from current employees
predictive validity
The extent to which applicants’ test scores
predict criterion data obtained from those
applicants/employees after they have been
on the job for a period of time
cross-validation
Verifying the results obtained from a validation study by administering a test or test
battery to a speci c sample
content validity
The extent to which a selection instrument,
such as a test, adequately samples the
knowledge and skills needed to perform
particular job tasks
The extent to which a selection tool predicts, or signi cantly correlates with,
important elements of work behaviour is known as cr iter ion -r elated valid ity.
How well a person performs on a test, for example, is compared to their actual
production records, supervisory ratings, training outcomes, and other measures of
success that are appropriate for the job. In a sales job, for example, it is common
to use sales gures as a basis for comparison. In production jobs, the quantity and
quality of output are likely to be important indicators of job success. The correlations that were presented in Figure 6.3 are examples of criterion-related validities
as they represent the relationship between the selection methods presented in
this chapter and job performance.
There are two types of criterion-related validity: concurrent and predictive.
Con cu r r en t valid ity involves obtaining criterion data from cu rren t employees at
about the sa me time that test scores (or other predictor information) are obtained.
For example, a supervisor is asked to rate a group of employees on the quantity
and quality of their performance. These employees are then given a work sample
test, and their test scores are compared to the supervisor’s ratings to determine
the degree of association between them. P r ed ictive valid ity, on the other hand,
involves testing a pplica n ts and obtaining criterion data a fter those applicants
have been hired and have been on the job for a period of time. For example,
applicants are given a work sample test during selection and the results are then
led for later comparison to on-the-job performance.
After the individuals have been on the job for several months, supervisors are
asked to rate these employees on the quality and quantity of their performance.
Their test scores are then compared to the supervisor ratings. If the scores and
the supervisor’s ratings correlate with one another, the test has predictive validity
and can be used to test subsequent candidates. Obviously, this approach to testing
will take longer to execute than the concurrent approach.
Regardless of the method used, cross-validation is essential. Cr oss-valid ation
is a process in which a test or battery of tests is administered to a speci c sample
of people for the purpose of verifying the results obtained from a larger validation study. For example, based on the ndings of scienti c research (such as the
data presented in Figure 6.3), an organization can assume that a cognitive ability
test will predict performance in their workplace, but that organization should
then collect their own data to con rm that this relationship does in fact exist in
their speci c work environment.
Co nte nt Valid ity
Another important way of determining the validity of a selection method is
content validity. Con ten t valid ity is assumed to exist when a selection instrument, such as a test, adequately samples the knowledge and skills a person needs
to perform particular job tasks.
The closer the content of the selection instrument is to actual work behaviours,
the greater its content validity. For example, an examination for accountants has
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high content validity when it requires applicants to solve accounting problems
representative of those found on the job. Asking an accountant to lift a 25-pound
box, however, is a selection procedure that has content validity only if the job
description indicates that accountants must be able to meet this requirement—
which is of course highly unlikely! Content validity is the most direct and least
complicated type of validity to assess. It is generally used to evaluate job knowledge and skill tests. Unlike the criterion-related method, content validity is not
expressed in correlational terms. Instead, an index is computed (from evaluations
of an expert panel) that indicates the relationship between the content of the test
items and a person’s performance on the job.48 Overall, content validity can make a
positive contribution to job analysis procedures and to the role of expert judgment
in sampling and scoring procedures.
Co nstruc t Valid ity
The extent to which a selection tool measures a theoretical construct, or trait, is
known as con str u ct valid ity. Typical constructs are intelligence, personality, and
anxiety. They are broad, general categories of human functions that are based on
the measurement of many discrete behaviours.
Measuring construct validity requires showing that the test developed to
assess a psychological trait accurately measures that psychological trait. For
example, if an organization decides to develop their own cognitive ability test (as
opposed to paying a testing company to use their established cognitive ability
test), then the organization should rst ensure that their own cognitive ability
test reaches similar conclusions about candidates as established tests (e.g., the
organization can administer their own test as well as established tests to see if
their test appears to be measuring the trait similar to the established tests). There
is a lack of literature covering this concept as it relates to employment practices,
probably because it is dif cult and expensive to validate a construct and to show
how it is job-related.49
construct validity
The extent to which a selection tool measures a theoretical construct or trait
Check In
Should applicants be given tests like personality and intelligence tests in employee selection?
Do you think that some applicants would nd these tests to be objectionable? On what basis could
their use for selection purposes be justi ed?
Re a c h in g a Se le c t io n D e c is io n
If you have followed the best practices from this chapter and have administered
several valid preemployment tests and conducted structured interviews, then you
now have a wealth of information about the candidates who want to work for
your organization. How do you weigh all these data to make a nal decision? The
next section examines various approaches that could be used.
Learning Outcome 4
Explain how rms can evaluate the information they collect on a group of candidates
and the decision strategies they can use to
select employees.
Su m m a r iz in g In fo r m a t io n a b o u t A p p lic a n t s
Taking into consideration all the information that you have gathered about applicants requires you to systematically organize all the relevant information about
them. An example of a summary form for an interview is shown in Figure 6.6
and this form can be used to ensure that all the pertinent information has been
included in the evaluation of the candidate’s interview performance.
Fundamentally, an employer is interested in what an applicant can do and
will do. Evaluating candidates on the basis of the information you have assembled should focus on these two factors, as Figure 6.7 shows. The “can do” factors
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F ig u r e 6 .6
Cand id ate Evaluatio n Sum m ary Fo rm
Position:
Candidate Name:
Interviewer Name(s):
Interview Date:
During the interview, circle your rating for each question and record your notes on the interviewee’s responses for each question.
Once the interview has concluded, add your ratings together for a nal score using the following candidate interview evaluation
summary form:
Teamwork
Decision-Making
Rating: ___________________________
Rating: ___________________________
Focus on Quality
Problem-Solving Ability
Rating: ___________________________
Rating: ___________________________
Focus on Customer Service
Verbal Communication Skills
Rating: ___________________________
Rating: ___________________________
Process Orientation
Leadership Skills
Rating: ___________________________
Rating: ___________________________
___________________________ TOTAL POINTS
F ig u r e 6 .7
“ Can Do ” and “ W ill Do ” Fac to rs in Jo b Pe rfo rm anc e
“ CAN DO”
Knowledge
Skills
Abilities
Aptitude
JOB
PERFORMANCE
“ WILL DO”
Personality
Values
Motivation
include a candidate’s knowledge, skills, and abilities, as well as their aptitude
(i.e., potential) for acquiring new knowledge and skills. The “will do” factors
include the candidate’s motivation, values, and personality characteristics. Both
factors are essential for successful performance on the job. The employee who
has the ability (can do) but is not motivated to use it (will not do) is little better
than the employee who lacks the necessary ability.
It is much easier to measure what individuals can do than what they will do.
The “can do” factors are readily evident from test scores and veri ed information. What the individual “will do” can only be inferred. Employers can use the
responses to interview and application form questions as well as personality
tests and references to obtain information for making inferences about what an
individual will do.
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D e c is io n - M a k in g St r a t e g y
The strategy used for making personnel decisions for one category of jobs might
differ from that used for another category. The strategy used to select managerial
and executive personnel, for example, will likely be different from the strategy
used to select administrative and technical personnel. Although many factors
must be considered in terms of making hiring decisions, the following are some
examples of the questions that managers must consider:
1. Should the hiring decision be concerned primarily with nding an ideal
employee to match the job currently open, or should a candidate’s potential
for advancement in the organization be considered?
2. Should the highest scoring applicant in the selection process be hired or
should other factors besides their score be considered (e.g., designated
group member status)?
3. What impact will the hiring decision have on the organization meeting its
employment equity plans and diversity considerations?
4. To what extent will the new hire need to be trained to perform the job?
5. At what grade or wage level should the individual be started?
6. How will the new hire’s job performance be measured and communicated?
In addition to these types of questions, managers must also consider which
approach they will use in making hiring decisions. There are two basic approaches
to selection: clinical (personal judgment) and statistical.
Clinic al Ap p ro ac h
In the clinical approach to decision-making, those making the selection decision
review all of the data on the applicants. Then, on the basis of their understanding
of the job and the individuals who have been successful in that job, they make
a decision. Different individuals often arrive at different decisions about an
applicant when they use this approach because each evaluator assigns different
weights to the applicant’s strengths and weaknesses. Unfortunately, personal
biases and stereotypes are frequently covered up by what appear to be rational
reasons for either accepting or rejecting a candidate. Moreover, this approach
can lead to a homogeneous workforce, because, as you learned in Chapter 5,
according to the Attraction-Selection-Attrition (ASA) model, people are often
tempted to hire applicants like themselves.
Statistic al Ap p ro ac h
In contrast to the clinical ap proach, the statistical ap p roach to decision-making
is more objective. It involves identifying the most valid p redictors and weighting
them using statistical methods, such as multip le regression.50 Quanti ed data,
such as scores or ratings from interviews, tests, and other p rocedures, are then
combined according to their objectively weighted value. A comp arison of the
clinical ap p roach with the statistical ap p roach in a wide variety of situations
has shown that the statistical ap proach is sup erior. Although this sup eriority
has been recognized for many decades, the clinical ap p roach continues to be
commonly used.
With a strictly statistical approach, a candidate’s high score on one predictor
(such as a cognitive ability test) can make up for a low score on another predictor
(such as the interview). For this reason, this model is a com p en sator y m od el.
However, it is frequently important that applicants achieve some minimum level
of pro ciency on some or all selection dimensions. When this is the case, a
m u ltip le cu toff m od el can be used in which only those candidates who score
at or above the minimum cutoff on all dimensions are considered. The selection
decision can then be made from that subset of candidates.51
compensatory model
Aselection decision model in which a high
score in one area can make up for a low
score in another area
multiple cutoff model
Aselection decision model that requires
an applicant to achieve a minimum level of
pro ciency on all selection dimensions
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multiple hurdle model
Asequential strategy in which only the
applicants passing the cutoff score at an
initial evaluation stage go on to the next
stage
selection ratio
The number of applicants to be selected
compared with the total number of applicants
A variation of the multiple cutoff model is referred to as the m u ltip le h u r d le
m od el. This decision strategy is sequential in that after candidates go through an
initial evaluation stage, the ones who pass the cutoff score are then assessed at
the next stage. The process continues through several stages (hurdles) before a
nal decision is made regarding the candidates. This approach is especially useful
when the testing procedures are expensive and when there is more time to make
the hiring decision.
The multiple cutoff and multiple hurdle approach both require that a decision
be made about where the cutoff is set—that point in the distribution of scores
above which a person should be considered and below which the person should
be rejected. The score that the applicant must achieve is the cutoff score. To avoid
legal dif culties, organizations need to ensure that the cutoff scores represent true,
objective job minimums that are based on a reliable and valid analysis of the job.
Of course, the most valid predictors should be used with any selection strategy.
Nonetheless, having an adequate number of applicants or candidates from which
to make a selection decision is a related factor that contributes to selecting the
best quali ed people. The selection r atio expresses the ratio of the number of
applicants to be selected to the total number of applicants. A ratio of 0.10, for
example, means that 10 percent of the applicants will be selected. A ratio of 0.90
means that 90 percent will be selected. If the selection ratio is low, only the most
promising applicants will be hired. When the ratio is high, very little selectivity
will be possible because even applicants with mediocre abilities will have to be
hired if the rm’s vacancies must be lled. When this is the situation, a rm’s
managers can fall prey to what is referred to as the “desperation bias”—choosing
someone because they are under pressure to make a hire or because there are no
better alternatives. It is a common problem among managers because of the many
time and operating constraints they face.
Fin a l D e c is io n
In large organizations, managers or sup ervisors usually make the nal decision
about whom to hire and communicate their decision to the HR department. HR
p ersonnel then notify the candidate about the decision and make a job offer. The
HR dep artment should con rm sp eci cs such as the details of the job, working
arrangements, hours, and wages, as well as a deadline by which the ap p licant
must reach a decision. Initially, this information can be verbally communicated.
It is commonp lace to rst contact candidates by p hone to inform them of the
offer. The offer should then be p ut in writing, generally in a letter or email
attachment that is sent to the candidate.
The process of notifying internal candidates is slightly different. Generally,
the hiring manager contacts the candidates personally and informs them of the
decision. However, it is still important to put the offer in writing if an internal
candidate is chosen so that there is no ambiguity or dispute about its terms.
Rejecting both internal and external candidates is a dif cult task but rejecting
internal candidates can be particularly tricky. Most internal candidates seeking
a promotion are valuable employees that their rms would rather not lose. The
manager delivering the bad news should explain to the employee that the decision
was made in a systematic manner based on objective criteria and provide speci cs
if requested.52 If accurate, the manager can also state that it was a dif cult decision to make and discuss the employee’s areas for development and how that
development can align with future job openings that are likely to arise.
Once the rst-choice applicant has signed and returned the job offer, then
organizations should notify the candidates who were not chosen for the position.
Failing to notify rejected applicants happens too often with both internal and
external candidates. It is common for external candidates to be customers of the
rms to which they apply. Not letting them know about the employment decision
can jeopardize that relationship. The same is true for internal candidates.
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As you have learned in this chapter, the selection process is complex and,
if all steps are used, very time consuming. However, if the best candidates are
hired, then the bene ts to the organization will be well worth the effort.
Check In
How have your skills, knowledge, aptitudes, and motivation in uenced the types of jobs that you
have applied for? Did you have all the KSAOs required for these jobs?
Small Business Application
What is different for selection in small businesses? The answer
is twofold. First, in all likelihood, the person conducting the
interview will be the business owner or hiring manager rather
than an HRprofessional. This will not be true in all cases, as
there may be times when small businesses work through
temporary staf ng companies or recruitment agencies; in these
cases, candidates would likely go through an interview with a
recruitment specialist prior to being referred for consideration.
Second, as we outlined in Chapter 3, the nature of working for
a small company is that people must t in with the team and
assist in many different capacities. As a result, where selection
for positions in large companies balances the importance of
person–job and person–organization t, in small companies, a
greater focus may be placed on person–organization t combined with the capability and motivation to perform the job in
question as well as providing assistance to others when needed.
So how do small companies ensure that their selection
process effectively assesses a candidate’s t? With the twin
goals of selection being to assess a candidate’s skills to
perform in the role and their ability to t into the organization, many small companies conduct multiple interviews.
For example, one interview is conducted by the functional
manager, which focuses on assessing the required job skill
and t with the operational leader. A second interview is
conducted by the business owner or another manager, with
the aim of assessing the candidate’s capacity and demonstrated willingness to support other activities, as well as
assessing organizational t. References are then checked,
with a cautionary recognition that references are seldom
negative as past employers do not wish to get involved in
any controversy as a result of providing negative feedback.
As a nal note, in Chapter 5 we identi ed that employee
referrals and hiring family members (i.e., nepotism) are
common practices in small companies. Small companies need
to be very cautious in the selection process when considering
referrals, friends, and family. Such selection creates bias, which
must be factored into the selection process. This does not mean
that small companies should not consider referrals, friends, and
family. It just means that all steps should be taken to con rm
that the candidate being referred is the best candidate for the
job based on job t and organizational t so as to minimize
hiring mistakes that come from incorrectly assuming the skills
and t of referrals, friends, and family. Research has shown that
using formal recruitment and selection techniques is linked to
positive employee perceptions, including of owner commitment,
and, more interestingly, employee loyalty.
Summary
Outcome 1 The employee selection process should
be based on the results of a job analysis. The steps in
the selection process and their sequence will vary not
only with the organization but also with the type and
level of job to be lled. The employee selection process
should provide reliable and valid information about
applicants so that their quali cations can be carefully
matched with the job’s speci cations. The information
that is obtained should be clearly job-related, predict
success on the job, and be free from bias and discrimination. The concepts of reliability and validity are also
fundamental to effective employee selection. Relia bility
refers to the consistency of test scores over time and
across measures. Va lidity refers to what a test or other
selection procedure is supposed to measure and how
well it actually measures it.
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Outcome 2 Initial applicant screening tools include
résumés, cover letters, and application forms. Despite
problems with the validity and defensibility of the
unstructured employment interview, interviews remain
central to the selection process. Depending on the
type of job, applicants could be interviewed by one
person, members of a work team, or other individuals
in the organization. Structured interviews have been
found to be better predictors of job performance than
unstructured (or nondirective) interviews. Some interviews are situational and focus on hypothetical situations and some interviews are behavioural and focus
on behavioural descriptions of a candidate’s previous
work experiences. Most interviews are conducted in
person, but they can also be conducted via video or
phone or administered by a computer (automated).
Post-interview screening tools include reference, background, and credit checks.
Outcome 3 Preemployment tests are often more objective and less expensive than interviews; further, they
can provide managers with additional information
about the capabilities of candidates. A wide range of
tests exist. Cognitive ability tests are especially valuable for assessing verbal, quantitative, and reasoning
abilities. Personality dimensions, such as conscientiousness, can predict job performance. Job knowledge and
work sample tests are achievement tests that are useful
for determining whether a candidate can perform the
duties of the job without further training. Physical
ability tests can be used to prevent accidents and injuries for physically demanding work. A test’s validity can
be assessed in terms of whether test scores correlate
with performance criteria (criterion-related validity),
whether the measurement is re ective of the work that
will be performed on the job (content validity), and
whether the test accurately measures what it intends to
measure (construct validity).
Outcome 4 In the process of making decisions, all “can
do” and “will do” factors should be assembled and
weighted systematically so that the nal decision can
be based on an objective analysis of the most reliable
and valid information. Although the clinical approach to
decision-making is often used, the statistical approach
is more accurate. Compensatory models allow a candidate’s high score on one predictor to make up for a
low score on another. When the multiple cutoff model
is used, only those candidates who score at or above
a minimum cutoff level for each selection tool remain
in the running. A variation of the multiple cutoff is the
multiple hurdle model, which involves several stages
with the applicants being removed from the process
should they fall below the cutoff score at any stage.
Those who are chosen should receive their offers in
writing so that the terms are clearly agreed upon.
Organizations should also notify candidates who are
not chosen for jobs.
Key Terms
assessment centres, 241
behavioural description interview
(BDI), 228
compensatory model, 245
computer-administered (automated)
interview, 230
concurrent validity, 242
construct validity, 243
content validity, 242
criterion-related validity, 242
cross-validation, 242
multiple cutoff model, 245
multiple hurdle model, 246
nondirective interview, 226
panel interview, 228
predictive validity, 242
preemployment test, 236
reliability, 220
selection, 218
selection ratio, 246
sequential interview, 229
situational interview, 227
structured interview, 226
validity, 220
video interviews, 230
video résumés, 225
Discussion Questions
1. What is the relationship between employee
selection and job analysis? First, de ne selection in
your own words. Next, describe the two primary
outcomes of job analysis. Finally, describe how
the process of job analysis will help to ensure that
employee selection is valid and defensible.
248
2. Why are reliability and validity important for
employee selection? First, de ne relia bility and
va lidity in your own words. Next, describe why it
is important for selection methods to be reliable
and valid. Finally, what are some of the selection
methods that have the highest and the lowest
criterion-related validities?
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3. Should HR professionals and hiring managers
search applicants’ names online and check their
social media before deciding whether or not to
invite them for a face-to-face interview? Is this a
common selection practice? Is this a valid selection
practice? What other concerns are associated with
conducting Internet searches on applicants?
4. Choose a job and identify a characteristic that is
important for performing that job. Next, develop
a situational interview question and a behavioural
description interview question for assessing that
characteristic. Finally, nd a classmate and ask
that person your two interview questions. What
worked and did not work when role-playing your
interview questions?
5. In general, how should employee selection
decisions be made? In what situations should
compensatory models be used? In what situations
should the multiple cutoff model or the multiple
hurdle model be used?
HRM Experience
De sig ning Se le c tio n Crite ria and M e tho d s
Making hiring decisions is one of the most important—and
dif cult—decisions a manager makes. Predicting the future
behaviour of people is a challenging task. The process begins
with a thorough understanding of the job: the tasks, duties, and
responsibilities associated with it and the knowledge, skills, abilities,
and other characteristics needed to do it. A job analysis should be
conducted to make certain that all managers have an understanding
of all the information they need to ensure a good person–job t.
However, this information may not be enough. Other information
about the company’s values and philosophy is likely to be required
to ensure that a good person–organization t results.
Assignment
1. Why is a hiring decision one of the most important decisions
that a manager makes? How dif cult is it for managers to
make effective hiring decisions? As a future manager, choose
a job that you think you may one day be hiring for. Set some
goals for how you would determine whether you have made
a good hiring decision for that job.
2. Next, search O*NET OnLine (www.onetonline.org) and
National Occupational Classi cation (https://noc.esdc.
gc.ca) to collect some information about the job you chose
in response to the rst assignment question. From this
information, choose what you believe to be the top ve most
important KSAOs needed to perform the job. Also, be sure to
provide your explanation and rationale for why these are the
most important KSAOs for that job.
3. After you have identi ed the top ve most important KSAOs
needed to perform the job, determine the best selection
method for assessing each of these KSAOs. Are the selection
methods you recommended valid? What is the criterionrelated validity for each of your recommended selection
methods?
4. Lastly, identify some values that you think you would want
your ideal hire to have. Is there a reliable and valid way to
assess candidate values in selection? What would be the best
way to determine whether the candidates have the values
that you identi ed?
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Case Study 1
Carlina Teteris/ Moment/ Getty Images
Job Candidate Assessment Tests Go Virtual
A growing number of preemployment tests simulate
a job’s functions and these tests are being conducted
with software. You can liken them to video games but
within a work setting. Toyota, Starbucks, and the paint
maker Sherwin-Williams have successfully used virtual
job simulations to assess applicants. The national real
estate rm Royal LePage placed a banner on its careers
section inviting candidates to try a real estate simulation to determine whether real estate was the right
career. Recruitment leads jumped 300 percent. CIBC’s
call centre also uses a simulation of the work of a call
centre employee, allowing candidates to experience the
work of a call centre employee while simultaneously
having their skills assessed by CIBC recruiters.
At Toyota, applicants participating in simulations
read dials and gauges, spot safety problems, and use
their ability to solve problems; at the same time, their
general ability to learn is assessed. The candidates can
see and hear about the job they are applying for from
current Toyota employees. National City Bank has used
virtual assessments to test call centre candidates and
branch manager candidates. Call centre candidates are
given customer service problems to solve, and branch
manager candidates go through a simulation that
assesses their ability to foster relationships with clients
and make personnel decisions.
Virtual assessment tools, which are produced
by companies such as Shaker Group Consulting and
Pro les International, do not come cheap. Although they
can cost tens of thousands of dollars, larger companies
that can afford them say they are worth it. The benets are better-quali ed candidates, faster recruiting, and
lower turnover among employees hired. KeyBank says
that by using virtual testing tools, it realized savings of
more than $1.75 million per year due to lower turnover.
Candidates also seem to like the assessments because
they provide a more realistic job preview and make
them feel as if they are being chosen for jobs based
on more than just their personalities or interview performance. “It was a very insightful experience that made
you think about what exactly you like and dislike in the
workplace and if you really enjoy helping customers and
have patience to do so,” says one candidate tested for a
customer service job.
HR experts warn that companies need to be sure
they are not simply buying glitzy simulations that do
not translate well to the jobs for which they are hiring.
Also, the screening tools could potentially eliminate
candidates who have trouble with simulations or computers but might make good employees. You should
ask the vendor to provide evidence that these methods
are reliable, valid, and non-discriminatory.
Questions
1. Of the selection methods discussed in this chapter,
which of them is most closely related to the preemployment tests that virtually simulate a job’s
functions, as discussed in this case? Is this a valid
selection method?
2. What are some of the bene ts of virtual assessment
tests for employers and job candidates? What are
some of the disadvantages of virtual assessment
tests for employers and job candidates? Overall,
should organizations use virtual assessment tests?
3. What evidence should HR professionals ask of
vendors of virtual assessment tests in order to
prove that these methods are reliable, valid, and
non-discriminatory?
Sources: Karen Vilardo, “KeyBank’s Success with the ‘Virtual_Job_Tryout’,” Journal of Corporate Recruiting Leadership 5, no. 4 (May 2010): 24; Ira S. Wolfe, “Success
Performance Solutions,” The Total View Newsletter (May 12, 2010); Connie Winkle, “HRTechnology: Job Tryouts Go Virtual,” HR Magazine (September 1, 2006),
http://www.shrm.org/; Gina Ruiz, “Job Candidate Assessment Tests Go Virtual,” Workforce Management Online (January 2008), http://www.workforce.com; “Clients and
Case Studies,” Shaker Consulting Group, http://www.shakercg.com, accessed March 27, 2011; Igor Kotlyar and Ravit Ableman, “Simulation Turns Recruitment into a
Two-Way Street,” Canadian HR Reporter 16, no. 21 (December 1, 2003): G6.
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Case Study 2
Kaspars Grinvalds/ Shutterstock.com
Pros and Cons of Cleaning Up the “Résu-Méss”
HR and hiring managers often
nd themselves
swamp ed by résumés because they are so easy to send
with the click of a button. Some large organizations
can get a million or more résumés a year. Even small
businesses get ooded with them. Ap p licant tracking
systems and résumé-screening software are help ing
busy HR p ersonnel, managers, and business owners
cop e with the issue of being ooded by résumés. After
résumés are screened and reviewed, interviews can be
scheduled automatically using a rm’s email system
and electronic calendar, and job offers sent to candidates to sign electronically and return. Many job boards
have résumé-screening cap abilities and algorithms to
recommend candidates similar to the way Amazon recommends p roducts based on what a p erson has p urchased in the p ast.
Not all HR professionals are fans of résuméscreening software, however. Managers tend to use a
huge number of key words so that very few applicants
can make it past the screen. Different kinds of software can have different kinds of glitches. The software
might not read some types of fonts or it might reject
a résumé of a good candidate if it contains a single
typo. Unquali ed applicants have learned to strategically use a job’s key words on their résumés to get past
résumé-screening software. Of great concern is that the
screening algorithms created can be biased and can
lead to discrimination.
Peter Cappelli, a University of Pennsylvania professor, has written a book called Why Good People Ca n’t
Get Jobs. Cappelli relates an incident in which an HR
manager put his own résumé through his company’s
screening process and got rejected. In another instance,
an engineering rm received more than 25,000 résumés
for a job but none of the candidates made it past the
electronic screening.
Résumé-screening software can’t easily pick up on
candidates’ “soft” skills, such as a person’s ability to
interact well with other people. And managers don’t
end up seeing interesting résumés—résumés from
people who have different skills or experiences that
would translate well to the job. Consequently, a lot of
people who would make excellent employees never get
a chance.
Some recruiters have found ways to avoid the
downsides of automatic résumé-screening altogether.
Kevin Mercuri, president of Propheta Communications,
a public relations rm in New York City, got tired of
being swamped by résumés. Now when he needs to
recruit personnel, he posts a message about job openings on his LinkedIn page. “I get people vouching for
each applicant, so I don’t have to spend hours sorting
through résumés,” he says.
Questions
1. Do better alternatives exist besides collecting
applicants’ résumés? What can be recommended
to HR and hiring managers who are looking for an
alternative to collecting applicants’ résumés?
2. What are some of the potential issues associated
with applicant tracking systems and résuméscreening software? Can these concerns be mitigated? If so, how?
3. If résumé-screening software is unable to assess
candidates’ “soft” skills, such as a person’s ability to
interact well with other people, then what selection
method could be used to assess these types of skills?
Sources: Ryan Craig, “Blame Bad Applicant Tracing for the Soft Skills Shortage at Your Company,” TechCrunch (March 5, 2017), https://techcrunch.com; Dave Wessel,
“Software Raises the Bar for Hiring,” Wall Street Journal (May 31, 2012), http://online.wsj.com; Darren Dahl, “Tapping the Talent Pool . . . without Drowning in Resumés,”
Inc. 31 no. 3 (April 2009): 122; Anne Kadet, “Did You Get My Résumé?” Smart Money (February 27, 2009), http://www.smartmoney.com; Drew Robb, “Screening for
Speedier Selection,” HRMagazine 49, no. 9 (September 2004): 143–47.
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Case Study 3
JHVEPhoto/ Shutterstock.com
Searching for Spies
The Canadian Security Intelligence Service (CSIS) is a
civilian-run agency, formerly the Security Services of
the RCMP. Its role is defensive: to protect Canada from
terrorists and foreign spies. It does not send armed
spies overseas. Curiously, for an extremely private
organization, CSIS has been named a top employer
three years in a row by Mediacorp Canada, a specialty
publisher of employment-related periodicals.
Since the 9/ 11 attacks, CSIS has added about 500
new staff, and new hires represent about 15 percent of
its workforce. Selecting spies used to be a secret process. There was no public knowledge about how spies
were recruited, what the job description was, and what
the selection criteria and methods were.
Each year, CSIS receives 3,000 unsolicited applications for about 100 openings. However, most of
these applications are from unquali ed James Bond
“wannabes.” CSIS wants highly quali ed, well-educated,
multilingual, multiskilled employees. It recruits openly,
and its selection criteria and processes are public.
In 2008, CSIS recruited at 53 career fairs, 142 information sessions, and 18 special career events. However,
in an effort to recruit more underrepresented people, it
also uses the Internet, business breakfasts, professional
associations, and academic connections. If you want to
apply, CSIS looks for Canadian citizens who are university graduates, preferably with advanced degrees. You
must have a valid driver’s licence and be able to relocate
anywhere in Canada at any time. You will have lived or
studied abroad, be pro cient in English and French, and
have a third or fourth language. CSIS looks for generalists: people who are knowledgeable about international
and political issues and who have investigative and analytical skills. As a CSIS employee, you will not be able to
discuss your work with outsiders at any time.
As an applicant, you must go through the following
selection process:
1. Submit a résumé.
2. Complete a 12-page application, which also
involves writing a 500-word essay explaining why
you want to become an intelligence of cer.
3. Attend a group information session, where recruiters
and intelligence of cers answer questions.
4. Attend a suitability interview, where your motivation
as well as your verbal and people skills are judged.
5. Take a battery of psychological and aptitude tests.
6. Have your language skills tested.
7. Attend a national assessment panel—veterans will
assess your motivation, knowledge of CSIS, and
general awareness of public affairs.
8. Be submitted to security clearance procedures
(including a polygraph test, ngerprints, a credit
check, a criminal record check, and references back
to your teen years), which take three months and
cost thousands of dollars.
9. Go to a nal interview.
This is a multiple-hurdle model of selection. As a
candidate, you will have to pass each hurdle before
being allowed to continue to the next. If successful,
you will be on probation for 5 years, undergo 12 weeks
of classroom and language training, and spend 2 or
3 years at an operations desk at headquarters before
being transferred to the eld under the guidance of a
mentor.
Questions
1. The Canadian Security Intelligence Service (CSIS) is
adding a large number of new staff each year, and
they receive about 3,000 unsolicited applications
per 100 openings. What are some recommendations for CSIS to ef ciently sort through the large
number of applications they are receiving? Is there
a way to sort through these applications in an
ef cient and accurate manner?
2. CSIS wants to hire highly quali ed, well-educated,
multilingual, multiskilled employees. There are
other job speci cations also mentioned in the case.
What would be the best selection methods to use
for hiring CSIS employees that have these KSAOs?
Be sure to specify which selection methods will
assess which KSAOs.
3. The case mentions that CSIS is using the multiple
hurdle model of selection. Is this a good idea? What
are some of the advantages and disadvantages
associated with this selection decision model?
Sources: Adapted from J. Sallot, “The Spy Masters’ Talent Hunt Goes Public,” The Globe and Mail (June 22, 1999): A1, A10; “Wanna Be a Spy? Your Country Needs You,”
The Province (March 14, 2008): A24; “Spies Like Us,” Canadian HR Reporter 16, no. 10 (May 19, 2003): G2.
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Notes and References
1. Peter A. Fisher et al., “Selection Myths: A Conceptual
Replication of HR Professionals’ Beliefs About Effective
Human Resource Practices in the US and Canada,”
Jou r n a l of Per son n el Psychology 20, no. 2 (2020): 51 –60,
https:/ / doi.org/ 10.1027/ 1866-5888/ a000263.
2. Philip L. Roth et al., “Social Media in EmployeeSelection-Related Decisions a Research
Agenda for Uncharted Territory,” Jou r n a l of
Ma n a gemen t 42, no. 1 (2013): 269 –98, https:/ / doi.
org/ 10.1177/ 0149206313503018; Kate Z. Williams,
Meline M. Schaffer, and Lauren E. Ellis, “Legal Risk in
Selection: An Analysis of Processes and Tools,” Jou r n a l
of Bu sin ess & Psychology 28, no. 4 (December 2013),
https:/ / doig/ org/ 10.1007/ s10869-013-9299-4.
3. Christopher Zatzick and Douglas Zatzick, “The Effect
of Perceived Person-Job Fit on Employee Attitudes
Towards Change in Trauma Centers,” Hea lth Ca re
Ma n a gemen t Review 38, no. 2 (April 2013): 115 –24;
Amy L. Kristof-Brown, Ryan D. Zimmerman, and Erin
C. Johnson, “Consequences of Individual’s Fit at Work:
A Meta-Analysis of Person-Job, Person-Organization,
Person-Group, and Person-Supervisor Fit,” Per son n el
Psychology 58, no. 2 (2005): 281 –342, https:/ / doi.
org/ 10.1111/ j.1744-6570.2005.00672.x.
4. Frank L. Schmidt and John E. Hunter, “The Validity
and Utility of Selection Methods in Personnel
Psychology: Practical and Theoretical Implications
of 85 Years of Research Findings,” Psychologica l
Bu lletin 124, no. 2 (1998): 262 –74, https:/ / doi.
org/ 10.1037/ 0033-2909.124.2.262.
5. Mary-Kathryn Zachary, “Discrimination without
Intent,” Su per vision 64, no. 5 (May 2003): 23 –29; Neal
Schmitt, William Rogers, David Chan, Lori Sheppard,
and Danielle Jennings, “Adverse Impact and Predictive
Ef ciency of Various Predictor Combinations,” Jou r n a l
of Applied Psychology 82, no. 5 (October 1997): 719 –30.
6. Chad H. Van Iddekinge, John D. Arnold, Rachel E.
Frieder, and Philip L. Roth. “A Meta-Analysis of the
Criterion-Related Validity of Prehire Work Experience,”
Per son n el Psychology 72, no. 4 (2019): 571 –98, https:/ /
doi.org/ 10.1111/ peps.12335.
7. “Employers Discriminate against Applicants with NonEnglish Names,” http:/ / www.publicaffairs.ubc.ca/ media/
releases/ 2009/ mr-09-056.html, retrieved March 26, 2012.
8. Sonia Kang, Katherine DeCelles, Andras Tilcsik,
and Sora Jun, “Whitened Resumes: Race and SelfPresentation in the Labor Market,” Admin istra tive
Scien ce Qu a r terly 61, no. 3 (March 2016): 1 –34.
9. Nicholas Keung, “Ottawa Pilots ‘Name-Blind’
Recruitment to Reduce ‘Unconscious Bias’ in Hiring,”
Tor on to Sta r (April 20, 2017), https:/ / www.thestar.com/
news/ immigration/ 2017/ 04/ 20/ ottawa-pilots-nameblind-recruitment-to-reduce-unconscious-bias-in-hiring.
html, retrieved May 21, 2018.
10. Parbudyal Singh and Dale Finn, “The Effects of
Information Technology on Recruitment,” Jou r n a l of
La bor Resea rch 14, no. 3 (2003): 395 –408.
11. “Busted,” Tra in in g Developmen t 60, no. 12 (December
2006): 19; Pamela Babock, “Spotting Lies,” HR Ma ga zin e
48, no. 10 (October 2003): 46–51; Tammy Prater and Sara
Bliss Kiser, “Lies, Lies, and More Lies,” A.A.M. Adva n ce
Ma n a gemen t Jou r n a l 67, no. 2 (Spring 2002): 9–14.
12. Liwen Zhang et al., “What’s on Job Seekers’ Social Media
Sites? A Content Analysis and Effects of Structure on
Recruiter Judgments and Predictive Validity,” Jou r n a l of
Applied Psychology 105, no. 12 (2020): 1530 –46, https:/ /
doi.org/ 10.1037/ apl0000490.
13. Annemarie M. F. Hiemstra et al., “Applicant Perceptions
of Initial Job Candidate Screening with Asynchronous
Job Interviews: Does Personality Matter?” Jou r n a l of
Per son n el Psychology 18, no. 3 (2019): 138 –47, https:/ /
doi.org/ 10.1027/ 1866-5888/ a000230.
14. Stephen D. Risavy, Peter A. Fisher, Chet Robie, and
Cornelius J. König, “Selection Tool Use: A Focus on
Personality Testing in Canada, the United States,
and Germany,” Per son n el Assessmen t a n d Decision s
5, no. 1 (2019): 62 –72, https:/ / doi.org/ 10.25035/
pad.2019.01.004.
15. Amy Maingault, John Sweeney, and Naomi Cossack,
“Interviewing, Management Training, Strikes,” HR
Ma ga zin e 52, no. 6 ( June 2007): 43; James Bassett,
“Stop, Thief!” Gifts & Decora tive Accessor ies 104, no. 1
( January 2003): 130–34; Richard A. Posthuma, Frederick
Morgeson, and Michael Campion, “Beyond Employment
Interview Validity: A Comprehensive Narrative Review
of Recent Research and Trends Over Time,” Per son n el
Psychology 55, no. 1 (Spring 2002): 1 –8.
16. Michael A. McDaniel, Deborah L. Whetzel, Frank
L. Schmidt, and Steven D. Maurer, “The Validity
of Employment Interviews: A Comprehensive
Review and Meta-Analysis,” Jou r n a l of Applied
Psychology 79, no. 4 (1994), 599 –616, https:/ / doi.
org/ 10.1037/ 0021-9010.79.4.599.
17. For a review of the research on the structured interview,
see Julia Levashina, Christopher J. Hartwell, Frederick
P. Morgeson, and Michael A. Campion, “The Structured
Employment Interview: Narrative and Quantitative
Review of the Research Literature,” Per son n el
Psychology 67, no. 1 (2014): 241 –93, https:/ / doi.
org/ 10.1111/ peps.12052; Brian Swider, Murray Barrick,
and Brad Harris, “Initial impressions: What They Are,
What They Are Not, and How They In uence Structured
Interview Outcomes,” Jou r n a l of Applied Psychology
101, no. 5 (May 2016): 625 –38.
18. Pamela Alonso, Silvia Moscoso, and Jesús F. Salgado,
“Structured Behavioral Interview as a Legal Guarantee for
Ensuring Equal Employment Opportunities for Women:
A Meta-Analysis,” The Eu r opea n Jou rn a l of Psychology
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Applied to Lega l Con text 9, no. 1 ( January–June 2017):
15–23, https:/ / doi.org/ 10.1016/ j.ejpal.2016.03.002.
19. Peter Herriot, “Assessment by Groups: Can Value Be
Added?” Eu r opea n Jou r n a l of Work & Or ga n iza tion a l
Psychology 12, no. 2 ( June 2003): 131 –46; Jesus
F. Salgado and Silvia Moscoso, “Comprehensive
Meta-Analysis of the Construct Validity of the
Employment Interview,” Eu r opea n Jou r n a l of Work
a n d Or ga n iza tion a l Psychology 11, no. 3 (September
2002), 299 –325; Amelia J. Prewett-Livingston, John G.
Veres III, Hubert S. Field, and Philip M. Lewis, “Effects
of Race on Interview Ratings in a Situational Panel
Interview,” Jou r n a l of Applied Psychology 81, no. 2
(April 1996): 178 –86. See also Damodar Y. Golhar and
Satish P. Deshpande, “HRM Practices of Large and
Small Canadian Manufacturing Firms,” Jou r n a l of Sma ll
Bu sin ess Ma n a gemen t 35, no. 3 ( July 1997): 30 –38.
20. “Survey: Six in Ten Companies Conduct Video Job
Interviews,” PR Newswire (August 30, 2012), http:/ /
prnewsire.com.
21. Julia Thomas, “Video Killed the Interview Star,”
DeGroote School of Business, July 29, 2013, http:/ /
www.degroote.mcmaster.ca.
22. Igor Kotlyar and Ravit Ableman, “Simulation Turns
Recruitment into a Two-Way Street,” Ca n a dia n HR
Repor ter (December 1, 2003): G6.
23. Hung-Yue Suen, Mavis Yi-Ching Chen, and Shih-Hao Lu,
“Does the Use of Synchrony and Arti cial Intelligence in
Video Interviews Affect Interview Ratings and Applicant
Attitudes?” Compu ters in Hu ma n Beha vior 98 (September
2019): 93–101, https:/ / doi.org/ 10.1016/ j.chb.2019.04.012.
24. Stuart Crandell, “Assessment Centers in Talent
Management: Strategies, Use and Value,” Ta len t
Ma n a gemen t ( January 7, 2008), http:/ / www.
talentmgt.com.
25. Kira Vermond, “References Done Right,” Pr o t 26, no. 2
(May 2007): 101; Kathleen Samey, “A Not-So-Perfect Fit,”
Adweek 44, no. 47 (December 1, 2003): 34; Ann Fisher,
“How Can We Be Sure We’re Not Hiring a Bunch of
Shady Liars?” For tu n e 147, no. 10 (May 26, 2003).
26. Victor Catano, Willi Wiesner, Rick Hackett, and Laura
Methot, Recr u itmen t a n d Selection in Ca n a da , 7th ed.
(Toronto: Nelson, 2019).
27. Todd Humber, “Recruitment Isn’t Getting Any Easier,”
Ca n a dia n HR Repor ter (May 23, 2005): R2, R3.
28. Doug Eisenschenk and Elaine Davis, “Background
Checks in Hiring and Compensation: The Next
Generation,” Ben e ts & Compen sa tion Digest 41, no. 10
(October 2004): 1 –4; “What’s New,” HR Ma ga zin e 49,
no. 4 (April 2004): 153 –56; “Why You Should Update
Your Background Checks,” HR Focus (February 1, 2004):
12 –13; Merry Mayer, “Background Checks in Focus,”
HR Ma ga zin e 47, no. 1 ( January 2002): 59 –62. In addition, organizations use other resources, such as the
following: The Gu ide to Ba ckgr ou n d In vestiga tion s: A
Comprehen sive Sou rce Director y for Employee Screen in g
a n d Ba ckgr ou n d In vestiga tion s, 8th ed. (TISI, 2000).
254
29. Filip Lievens and Fionna Patterson, “The Validity
and Incremental Validity of Knowledge Tests, LowFidelity Simulations, and High-Fidelity Simulations for
Predicting Job Performance in Advanced-Level HighStakes Selection,” Jou r n a l of Applied Psychology 96, no.
5 (September 2011): 927 –40, https:/ / doi.org/ 10.1037/
a0023496.
30. Rachel Suff, “Testing the Water: Using Work Sampling
for Selection,” IRS Employmen t Review, no. 802 ( June
18, 2004): 44 –49; Leonard D. Goodstein and Alan D.
Davidson, “Hiring the Right Stuff: Using CompetencyBased Selection,” Compen sa tion & Ben e ts Ma n a gemen t
14, no. 3 (Summer 1998): 1 –10.
31. N. Murphy, “Testing the Waters: Employers’ Use of
Selection Assessments,” IRS Employmen t Review
852 (2006): 42 –48; Florence Berger and Ajay Ghei,
“Employment Tests: A Facet of Hospitality Hiring,”
Cor n ell Hotel a n d Resta u ra n t Admin istra tion
Qu a r terly 36, no. 6 (1995): 28 –35, https:/ / doi.
org/ 10.1177/ 001088049503600614; Malcolm J. Ree,
Thomas R. Carretta, and Mark S. Teachout, “Role of
Ability and Prior Knowledge in Complex Training
Performance,” Jou r n a l of Applied Psychology 80,
no. 6 (1995): 721 –30, https:/ / doi.org/ 10.1037/ 00219010.80.6.721; Frank L. Schmidt and John E. Hunter,
“The Validity and Utility of Selection Methods in
Personnel Psychology: Practical and Theoretical
Implications of 85 Years of Research Findings,”
Psychologica l Bu lletin 124, no. 2 (1998): 262 –74, https:/ /
doi.org/ 10.1037/ 0033-2909.124.2.262.
32. Kotlyar and Ableman, “Simulation Turns Recruitment
into a Two-Way Street.”
33. Sara Rynes, Amy Colbert, and Kenneth Brown, “HR
Professionals’ Beliefs about Effective Human Resource
Practices: Correspondence between Research and
Practice,” Hu ma n Resou rce Ma n a gemen t 41, no. 2
(Summer 2002): 149 –74. Frank L. Schmidt and John E.
Hunter, “The Validity and Utility of Selection Methods
in Personnel Psychology: Practical and Theoretical
Implications of 85 Years of Research Findings,”
Psychologica l Bu lletin 124, no. 2 (1998): 262 –74, https:/ /
doi.org/ 10.1037/ 0033-2909.124.2.262.
34. Ernest H. O’Boyle et al., “The Relation Between
Emotional Intelligence and Job Performance: A MetaAnalysis,” Jou r n a l of Or ga n iza tion a l Beha vior 32, no. 5
( July 2011): 788 –818, https:/ / doi.org/ 10.1002/ job.714.
35. Gregory M. Hurtz and John J. Donovan, “Personality and
Job Performance: The Big Five Revisited,” Jou r n a l of
Applied Psychology 85, no. 6 (December 2000): 869 –79,
https:/ / doi.org/ 10.1037/ 0021-9010.85.6.869; Murray R.
Barrick and Michael K. Mount, “The Big Five Personality
Dimensions and Job Performance: A Meta-Analysis,”
Per son n el Psychology 44, no. 1 (March 1991): 1 –26,
https:/ / doi.org/ 10.1111/ j.1744-6570.1991.tb00688.x.
36. Kris Frieswick, “Casting to Type,” CFO 20, no. 9 ( July
2004): 71–73; Timothy Judge and Joyce Bono, “Five-Factor
Model of Personality and Transformational Leadership,”
Jou rn a l of Applied Psychology 85, no. 5 (October 2000):
751–65; J. Michael Crant and Thomas S. Bateman,
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“Charismatic Leadership Viewed from Above: The Impact
of Proactive Personality,” Jou rn a l of Or ga n iza tion a l
Beha vior 21, no. 1 (February 2000): 63–75.
and Stephen Berkley, “The Selection of Entry-Level
Corrections Of cers: Pennsylvania Research,” Pu blic
Per son n el Ma n a gemen t 30, no. 3 (Fall 2001): 377 –418.
37. Kibeom Lee and Michael C. Ashton, “Psychometric
Properties of the HEXACO Personality Inventory,”
Mu ltiva r ia te Beha viora l Resea rch 39, no. 2 (April 2004):
329 –58, https:/ / doi.org/ 10.1207/ s15327906mbr3902_8.
45. Br itish Colu mbia (Pu blic Ser vice Employee Rela tion s
Commission ) v. BCGSEU, [1999] 3 S.C.R. 3; https:/ / scccsc.lexum.com/ scc-csc/ scc-csc/ en/ item/ 1724/ index.
do?q=meiorin, retrieved December 18, 2020.
38. L. Bernier, “Out of This World Recruitment,” Ca n a dia n
HR Repor ter 27, no. 4 (February 24, 2014): 1 , 9.
46. Ontario Human Rights Commission, “Drugs and
Alcohol Testing,” http:/ / www.ohrc.on.ca/ en/ drug-andalcohol-testing-%E2%80%93-frequently-asked-questions,
retrieved May 22, 2018.
39. Richard D. Gof n and Allison C. Boyd, “Faking
and Personality Assessment in Personnel Selection:
Advancing Models of Faking,” Ca n a dia n Psychology 50,
no. 3 (August 2009): 151 –60, https:/ / doi.org/ 10.1037/
a0015946.
40. Frederick P. Morgeson, Michael A. Campion, Robert
L. Dipboye, John R. Hollenbeck, Kevin Murphy, and
Neal Schmitt, “Reconsidering the Use of Personality
Tests in Personnel Selection Contexts,” Per son n el
Psychology 60, no. 3 (Autumn 2007): 683 –729; Arielle
Emmett, “Snake Oil or Science? The Raging Debate on
Personality Testing,” Workforce Ma n a gemen t 83, no.
10 (October 2004): 90 –93; Gregory Hurtz and John
Donovan, “Personality and Job Performance: The Big
Five Revisited,” Jou r n a l of Applied Psychology 85, no. 6
(December 2000): 869 –79.
41. Constance L. Hays, “Tests Are Becoming Common in
Hiring,” New York Times (November 28, 1997): D1. See
also Gregory M. Lousig-Nont, “Avoid Common Hiring
Mistakes with Honesty Tests,” Na tion’s Resta u ra n t
News 31, no. 11 (March 17, 1997): 30; “If the Shoe Fits,”
Secu r ity Ma n a gemen t 40, no. 2 (February 1996): 11;
Michelle Cottle, “Job Testing: Multiple Choices,” New
York Times (September 5, 1999): 10.
42. Thomas J. Ryan, “Nerves of Steal,” SGB 37, no. 6 ( June
2004): 8 –10; D. S. Ones, C. Viswesvaran, and F. L.
Schmidt, “Comp rehensive Meta-Analysis of Integrity
Test Validities: Findings and Imp lications for Personnel
Selection and Theories of Job Performance,” Jou r n a l of
Applied Psychology 78 (August 1993): 679 –703. See also
Deniz S. Ones and Chockalingam Viswesvaran, “Gender,
Age and Race Differences on Overt Integrity Tests:
Results across Four Large-Scale Job Ap p licant Data
Sets,” Jou r n a l of Applied Psychology 83, no. 1
(February 1998): 35 –42.
43. James Krohe, Jr., “Are Workplace Tests Worth Taking?”
Acr oss the Boa rd 43, no. 4 ( July–August 2006): 16 –23;
“Honesty Tests Flawed,” People Ma n a gemen t 3, no.
2 ( January 23, 1997): 15; Hays, “Tests Are Becoming
Common in Hiring”; Stephen A. Dwight and George
M. Alliger, “Reactions to Overt Integrity Test Items,”
Edu ca tion a l a n d Psychologica l Mea su remen t 57, no. 6
(December 1997): 937 –48.
44. Walter C. Borman, Mary Ann Hanson, and Jerry
W. Hedge, “Personnel Selection,” An n u a l Review
of Psychology 48 (1997): 299 –337; Charles Sproule
47. Crandell, “Assessment Centers in Talent Management:
Strategies, Use and Value.”
48. Philip Bobko, Philip L. Roth, and Maury A. Buster,
“The Usefulness of Unit Weights in Creating Composite
Scores: A Literature Review, Application to Content
Validity, and Meta-Analysis,” Or ga n iza tion a l Resea rch
Methods 10, no. 4 (October 2007): 689 –709; Kobi Dayan,
Ronen Kasten, and Shaul Fox, “Entry-Level Police
Candidate Assessment Center: An Ef cient Tool or a
Hammer to Kill a Fly?” Per son n el Psychology 55, no. 4
(Winter 2002): 827 –49.
49. Deniz S. Ones, Chockalingam Viswesvaran, and Frank
L. Schmidt, “No New Terrain: Reliability and Construct
Validity of Job Performance Ratings,” In du str ia l &
Or ga n iza tion a l Psychology 1, no. 2 ( June 2008): 174 –79;
D. Brent Smith and Lill Ellingson, “Substance versus
Style: A New Look at Social Desirability in Motivating
Contexts,” Jou r n a l of Applied Psychology 87, no. 2 (April
2002): 211 –19; Ken Craik, Aaron Ware, John Kamp,
Charles O’Reilly III, Barry Staw, and Sheldon Zedeck,
“Explorations of Construct Validity in a Combined
Managerial and Personality Assessment Programme,”
Jou r n a l of Occu pa tion a l a n d Or ga n iza tion a l
Psychology 75, no. 2 ( June 2002): 171 –93.
50. Multiple regression is a statistical method for evaluating
the magnitude of effects of more than one independent
variable (e.g., selection predictors) on a dependent variable (e.g., job performance) using principles of correlation and regression.
51. Patricia M. Buhler, “Managing in the New Millennium,”
Su per vision 68, no. 11 (November 2007): 17 –20; David
E. Bowen and Cheri Ostroff, “Understanding HRM—
Firm Performance Linkages: The Role of the Strengths
of the HRM System,” Aca demy of Ma n a gemen t Review
29, no. 2 (April 2004): 203 –22; Ann Marie Ryan, Joshua
Sacco, Lynn McFarland, and David Kriska, “Applicant
Self-Selection: Correlates of Withdrawal from a Multiple
Hurdle Process,” Jou r n a l of Applied Psychology 85, no. 2
(April 2000): 163 –79.
52. “Considering and Evaluating Internal Candidates for
Senior-Level Nonpro t Organizations,” Br idgesta r,
http:/ / www.bridgestar.org, retrieved March 27, 2011.
Answers to Figure 6.5: 3, 3, 4
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Workplace training used to be rather boxlike. It focuses on teaching employees to
do particular activities—operate machines, process work, and so forth. However,
as the workplace shifted from “touch labour” to “knowledge workers” (see
Chapter 1), the focus of training has shifted as well. Companies are realizing that
workers need not only operational know-how but also superior job expertise;
knowledge about competitive, industry, and technological trends; and the ability
to continually learn and use new information. These characteristics better help
an organization adapt and innovate to compete far more effectively in today’s
fast-paced global business world.
Th e Sc o p e o f Tr a in in g
Learning Outcome 1
Many new emp loyees come equip p ed with most of th e knowledge, skills,
and abilities needed to start work. Oth ers require extensive training before
th ey are ready to make much of a contribution to th e organization. Th e term
tr a in in g is often used casually to describe almost any effort initiated by an
organization to foster learning among its members. However, many exp erts
distinguish between tr a in in g, wh ich tends to be more narrowly focused and
oriented toward sh ort-term p erformance concerns, and d evelopm en t, wh ich ,
as you learned in Ch ap ter 5, tends to be oriented more toward broadening
an individual’s skills for future resp onsibilities. Th e two terms tend to be
combined into a single p h rase—training and develop ment—to recognize th e
combination of activities organizations use to increase th e knowledge and
skills of emp loyees.
Research shows that an organization’s revenues and overall pro tability are
positively correlated to the amount of training it gives its employees. According
to the Conference Board of Canada, Canadian organizations provide each of
their employees with about 25 hours of training annually.1 By contrast, the
100 best U.S. companies to work for, as cited by For tu n e magazine, provide their
employees with approximately triple that amount of training and sometimes even
more. New employees hired by the Ritz-Carlton hotel chain get over 300 hours of
training. The greatest proportion of training is spent on rank-and- le employees
and supervisors.
The global pandemic brought about organizational challenges. However, putting people development on pause was not a choice because the pre-COVID
“normal” workplace was not anticipated to be an option in the near future,
if ever.2 COVID-19 forced companies to reimagine how to develop and train
their workforce and identify ways to strengthen organizational capabilities.3 It
essentially accelerated shifts that were already taking place, speci cally pushing
companies to connect digitally and use technology to increase output without
signi cantly increasing expenditure.4
Travel restrictions and social distancing requirements caused signi cant
changes to the pre-existing operations. There were challenges with learning and
development, employee coaching, and skills certi cations spaces and how to move
these in-person activities to an online format without any preparation time.5 Take,
for example, apprentices and internships. Though previously requiring hands-on
and in-person participation, most programs moved to online or signi cantly limited their size. Some organizations condensed their apprenticeship training from
a 10- to 12-week program to a 1- to 2-week program.6 As another example, the
Canadian military could only provide training to new hires at about one-quarter
of what was anticipated in 2020, resulting in a shortfall of its target by 2,000 regular force members and 5,000 reservists.7 There was also a decline in satisfaction
Discuss the scope of training and
development and the relationships with
organizational strategy.
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of the existing training programs during the pandemic, at 34.8 percent satisfaction, decreasing an already low 37.9 percent satisfaction level.8
Across organizations, training and develop ment exp enditure diminished.9
Ap p roximately 56 p ercent of emp loyees stated that they had had fewer training
and develop ment op p ortunities during the p andemic. However, the need for
trained and skilled p rofessionals only increased with changing workforce
requirements. Without suf cient op p ortunity, many individuals felt de cient in
carrying out their resp onsibilities.10 Meanwhile, other Canadians who lost their
job during the p andemic felt a p ressing need to learn new skills to rejoin the
workforce.11
Several p rograms have been established to combat the ongoing challenges
during the p andemic. For examp le, the Canadian government recently launched
Skills for Success, a training p rogram to help 90,000 Canadians imp rove their
skills and get back to work. Skills for Success have funded organizations in
their p ursuit to offer tools, resources, and training to individuals to adap t and
ourish in today’s economy.12 As another examp le of an initiative to sup p ort the
growing need for training and develop ment amidst the p andemic, the Torontobased Future Skills Centre stated that it would fund 64 p rojects with the federal
government’s help at the cost of $32 million. The funding sup p orted workers
imp acted by the p andemic in up grading or develop ing new skills. One of the
many initiatives involved help ing 120 unemp loyed women in Ontario reskill to
p ursue p ositions in high-growth sectors such as technology, nance, or health
care.13
Businesses spend nearly fou r times as much on informal instruction as they
do on formal instruction, however. The informal instruction ranges from simple,
on-the-job instruction to sophisticated skills training conducted on multimillion-dollar simulators. Other types of training include regular training given to
new hires, customer service and communication skills training, and compliance
training—training employees must receive as a result of various legal mandates,
such as employment equity or occupational health and safety requirements.
Ethics in HRM presents the debate about the effectiveness of mandatory training
for employees.
A St r a t e g ic A p p r o a c h t o Tr a in in g
chief learning of cers
Ahigh-ranking manager directly responsible
for fostering employee learning and
development within the rm
258
Because business conditions change rapidly, as does technology, keeping abreast
of the types of training a rm’s employees need to remain competitive can be a
challenge. If employees consistently fail to achieve their productivity objectives,
this might be a signal that training is needed. Likewise, if organizations receive
an excessive number of customer complaints, this, too, might suggest that a
rm’s training is inadequate. Larger rms, including GE, Walmart, and IBM, sometimes have what are called ch ief lear n in g of cer s. These people are top executives within their rms who are responsible for making certain that a company’s
training is timely and focused on the rm’s top strategic issues.
To ensure that a rm’s training and development investment has the maximum impact possible, a strategic and systematic approach should be used
that involves four phases: (1) a needs assessment based on the rm’s competitive objectives: What training does the rm really need? (2) program design:
given those needs, how should the training program be designed or structured?
(3) implementation: how should the program be delivered—that is, by what
method? (4) evaluation: how can the rm tell if the training program is really
working? Figure 7.1 presents these elements. We will use it as a framework for
organizing the material throughout this chapter.
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Ethics in HRM
M and ato ry o r Vo luntary?
There is only one payroll training tax in North America. The
Quebec government program that forces employers to spend
one percent of payroll on training may not have the intended
consequences of increasing training investments in employees.
Using data from a Statistics Canada survey, Alan Saks of the
University of Toronto and Robert Haccoun of the Université de
Montréal matched Quebec employers with Ontario employers
and found that there were no differences in amounts spent
on training. The paperwork is so cumbersome that many
employers prefer to pay the one percent tax rather than go
through the thick guidebooks necessary to report the training.
There are many other mandatory training programs
across Canada. In addition to legal requirements in posting
information on employment standards, occupational health
and safety, accessibility, pay equity plans, workplace violence
policies, among others, legislation requires organizations
to have formal training programs in place. This includes
training in Workplace Hazardous Materials Information System
(WHMIS), which must include an explanation of the purpose
and contents of supplier and workplace labels, the storage
and handling of hazardous products, and safety procedures.
Health and Safety legislation requires employers to ensure
that they have a basic awareness program in place. And workplace and sexual harassment legislation requires adequate
instruction and training on the policies and programs in pace.
If little effect is gained by forcing employers to provide
training, are there bene ts by forcing employees to attend
training? The answer is not clear: some studies report some
slight bene ts in outcomes (such as improved job performance) when employees voluntarily attend courses; other
studies see no differences.
There may be more serious problems than performance results created by forcing employees to attend
courses. Half of the 24 employees of SaskTel who participated in a training program on process reengineering
required psychological counselling, stress leave, or both
in its aftermath. Trainees said they were subjected to a
greenhouse environment: windows were papered over,
employees were not allowed to communicate with one
another, and all were subjected to verbal abuse from the
training consultants. As the president of the Ontario Society
for Training and Development commented, “That’s not
training, that’s assault.”
Seagulls Pewter and Silversmiths of Pugwash, Nova
Scotia, sent its employees to seminars based on the
controversial Erhard Seminars Training (EST) therapy.
Employees complained to their union that the seminars,
in which participants were encouraged to delve into
painful emotions, often drove participants to breakdowns.
In another example, a large insurance company hired a
consultant to conduct management training for hundreds
of supervisors and managers. The company did not realize
that the consultant was a member of L. Ron Hubbard’s
Church of Scientology and was teaching management principles developed by scientologists. Critics contend that scientology is a cult, not a religion. Employees resented being
subjected to psychological concepts based on “tones”
that catalogue emotions, to the ruthless devotion to ferreting out and firing problem employees, and to “religious
scriptures.”
The employees in these organizations were required
to participate in programs that caused them undue
stress and sometimes violated their moral or religious
beliefs. Those who organized the programs believed
that employees with the “right” attitudes would be more
effective.
Sources: A. Gegenfurtner, K. Konings, N. Kosmajac, M. Gebhardt, and K. Harding, “Voluntary or Mandatory Training Participation as a Moderator in the
Relationship between Goal Orientations and Transfer of Training,” International Journal of Training & Development 20, no. 4 (December 2016): 290–301;
C. Curado, P. Henriques, and S. Ribeiro, “Voluntary or Mandatory Enrollment in Training and the Motivation to Transfer Training,” International Journal of
Training & Development 19, no. 2 (June 2015): 98–109; “A Taxing Way to Train Staff,” The Globe and Mail (June 4, 2003): C1; D. Brown, “Legislated Training,
Questionable Results,” Canadian HR Reporter 15, no. 9 (May 6, 2002): 1; A. Tomlinson, “Mandatory or Voluntary?” Canadian HR Reporter 15, no. 6 (March 25,
2002): 1; Edward Kay, “Trauma in Real Life,” The Globe and Mail Report on Business Magazine (November 1996): 82–92; J. Saunders, “How Scientology’s
Message Came to Allstate,” The Globe and Mail (April 24, 1995): B1; R. Sharpe, “Agents of Intimidation,” The Globe and Mail (March 28, 1995): B8.
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F ig u r e 7 .1
Strate g ic M o d e l o f Training
Strategic Model for Training and Development
Phase One:
Needs Assessment
Organization
Task analysis
Person analysis
Phase Four:
Evaluation
Reactions
Learning
Behaviour
Results
Phase Two:
Design
Objectives
Trainee readiness
Principles of learning
Phase Three:
Implementation
Methods
Learning outcomes
Check In
What aspects of training plans do you think are strategic? What are some of the challenges posed
by the COVID-19 pandemic to an organization’s training and development plans?
Learning Outcome 2
Describe the steps involved in training
needs assessment.
P h a s e 1: C o n d u c t in g t h e N e e d s
Assessm ent
If you own or manage a business, how would you gure out what types of
training your employees need and how much of it? The following are some of the
most common types of training employees are given:
●
orientation training for new hires,
●
basic on-the-job training for new hires,
●
managerial training,
●
sales training,
●
executive training,
●
information technology (IT)/ computer training,
●
customer service training,
●
compliance (regulations) training,
●
ethics training, and
●
diversity training.
Doing a needs assessment does not need to be a labourious task.14 Highlights
in HRM 7.1 provid