UNIVERSITY OF LUSAKA
SCHOOL OF BUSINESS
Course Title:
Human Resource Management and Development
Course Code:
HRM 220
Lecturer:
Sylvia Atoko (Mrs)
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TOPIC ONE:
INTRODUCTION TO HUMAN RESOURCE
MANAGEMENT
Topic objectives
After studying this topic, the student should be able to:
 Define human resource management;
 Explain the functions of human resource management;
 Understand the importance of human resource management;
 Distinguish the differences between personnel management and human resource
management.
DEFINITION OF HUMAN RESOURCES MANAGEMENT
According to Michael Armstrong, Human Resources management is “a strategic and
coherent approach to the management of an organization’s most valued assets: the people
working there individually and collectively to contribute to the achievement of its
objectives.”
Flippo B.E. (1976) uses the term Human Resources Management synonymously with
Personnel Management. He defines Personnel management as the planning, organising,
directing, and controlling of the procurement, development, compensation, integration,
maintenance, and separation of human resources to the end that individual, organisational,
and societal objectives are accomplished.
FUNCTIONS OF HUMAN RESOURCE MANAGEMENT
Human Resources Managers perform two (2) major functions, namely:
1. General Management functions which include Planning, Organising, Directing and
Controlling
2. Specific Human Resource Management functions. These are Procurement, Development,
Compensation, Integration, Maintenance, and Separation
GENERAL MANAGEMENT FUNCTIONS
A.
PLANNING
The need for planning derives from the fact that organisations are goal-seeking entities;
planning is a tool for identifying these goals and finding ways to achieve them. Managers
develop short term, medium term, and long term plans at the various levels of
management.
Planning is also a pre-requisite for the other managerial functions of organising, directing
and controlling. It allows managers to co-ordinate the activities of their employees
towards pre- determined goals. It also becomes the basis for monitoring and evaluating
actual performance.
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B.
ORGANISING
Once workable plans are developed, managers should organise their people and other
resources in some logical manner so as to carry out the plans.
Organising involves: Acquiring the necessary resources
 Dividing organisational activities into groups /departments such as the Purchasing
department, Production department, Marketing department, Accounting department,
Human Resource department, and General administration department among others.
 Assigning people to various groups
 Defining working relationship among various groups. Organisational activities are
often divided into various groups/ departments and people with specialised knowledge
and interest are assigned these tasks. Formal and informal relationships among group
members are specified to facilitate effective communication and working
relationships.
C.
DIRECTING
Most managers spent a great deal of their time directing the efforts of organisational
members.
These functions includes: Motivation
 Leadership
 Communication
 Co-ordination
Motivation
Motivating employees is an important task for managers because they rely on employees
to get the work done. People join and work in organisations to satisfy their needs;
organisations lead people to carry out the activities needed to achieve their goals.
Motivation involves finding the incentives that satisfy the needs of employees. Different
people are motivated by different things such as:
 Money
 Job security
 Good working conditions
 Appropriate supervision
 Friendly co-workers
 Recognition
 An interesting job
 Growth opportunities
Leadership
Leadership means the ability to influence the behaviour of other people in a certain
direction. Managers need this ability to get employees to accomplish organisational tasks.
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Often managers acquire leadership skills through expert knowledge, respect, and personal
charisma or by other means.
Communication
Communication is the transmission of information from and to all levels of the
organisation. The managerial process relies heavily on effective communication.
Managers should therefore learn to communicate effectively.
Co-ordination
Co-ordination is the process by which the activities of the organisational members are
integrated to achieve organisational goals most sufficiently. Since most organisational
activities are divided and performed by different individuals or groups, they need to be
co-ordinated by managers at different levels to achieve the goals in a concerted manner.
Co-ordination is important because, according to the principle of unity of direction, all the
activities of an organization are intended to achieve some common objectives.
D.
CONTROL FUNCTION
This is the final stage of the managerial process and involves ensuring organisational
activities are carried out as planned.
There are 4 steps in controlling namely: 1) Establishing performance goals or standards e.g. profits of $20m to be achieved in the
year 2007
2) Measuring Actual performance e.g. profits achieved for the year 2007 are $15m
3) Comparing actual performance with goals or standards e.g.
Planned performance $ 20m
Actual performance $ 15m
Variance/ Deviation $ 5m
4. Rewarding excellent performance or taking corrective action such as lowering the
profit expectations and training the workers.
Performance standards are the yardsticks (measuring units) against which actual
performance is measured. To be effective the standards must be attainable and specific.
Actual performance is then compared to standards to see if the work has been done
successfully. Human resource auditing is an evaluation of the Human Resource activities
to find out if they are in line with the objectives of the organisation.
SPECIFIC HUMAN RESOURCE MANAGEMENT FUNCTIONS
A.
PROCUREMENT/ACQUISITION/RECRUITMENT
This is concerned with obtaining the proper quality and quantity of employees that are
necessary to accomplish an organisation's goals. Acquisition deals specifically with
subjects such as strategic human resource planning, determining sources of recruitment,
communicating with potential candidates, inviting and receiving job applications,
reviewing application forms, short-listing the candidates for interviews, selection through
interviews, conducting pre-employment tests, checking referees, giving job offers or
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letters of regret, and inducting and placing selected employees. In order to determine the
human resource requirements of an organisation, it is necessary to establish the duties to
be done so as to meet organisational objectives. The establishment of duties becomes a
basis for the recruitment exercise.
B.
TRAINING AND DEVELOPMENT
Many managers have realised that employees do not learn new skills through trial and
error or simply by watching other employees. Thus the training of employees is extremely
important to every pragmatic organisation.
Training has to do with the increase of skills and it is necessary for proper job
performance. The importance of employee training is envisaged to continue growing
because of changes in technology, the realignment of jobs, and the increasing complexity
of the managerial tasks.
While training emphasises skill development and the changing of attitudes among
workers, development is directed to the managers of the organisation. Development
concerns itself primarily with knowledge acquisition and the enhancement of executives’
conceptual, diagnostic and human abilities.
C.
COMPENSATION
Employees exchange their work for rewards and money is probably the most important
reward. Compensation administration is concerned with the adequate and equitable
remuneration of employees for their contributions to organisational objectives. It is one of
the most important functions of the human resource manager.
D.
INTEGRATION
The need for integration arises from the realisation that employees have many differences
among themselves and which may affect their work performance. Conflicts often arise
between employees, work groups, employees and the management, or even between the
organisation and other organisations.
The essence of integration is to attempt to effect a reasonable reconciliation of the
conflicting interests. In this case, the human resource manager would deal with issues
such as grievances, disciplinary action, and labour unions.
E.
MAINTENANCE
The aim of maintenance is to ensure that employees are happy with their jobs, the
organisation, relationships with colleagues and so on. Through maintenance one will be
able to perpetuate a willing and able workforce. The maintenance of willingness is
heavily affected by communication with employees, good physical condition of the
employees, and health and safety of the workers.
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F.
SEPARATION
Separation involves returning the employees to the society from which they came and
ensuring that the returned employees are in as good shape as possible. Separation may
take the form of retirement, layoffs, outplacement, and discharge. In some cases
employees die while they are still in active employment. The organisation, led by social
responsibility principles, should assist the family of the affected person in a variety of
ways.
IMPORTANCE OF HUMAN RESOURCE MANAGEMENT
The discipline of human resource management is extremely important for academicians
and business practitioners because of a number of reasons. For students, the knowledge
and qualifications in human resource management can lead to lucrative employment
opportunities.
Business people who have knowledge of human resource management will be able to:
a)
b)
c)
d)
e)
f)
Hire the right quality and quantity of people for the jobs in the organization.
Ensure the welfare of the employees is taken care of. The result will be lower
labour turnover and a higher employee retention rate.
Achieve higher productivity for the organizations by ensuring motivated
employees are doing their best.
Avoid long and expensive court battles with some employees due to issues
such as discrimination, unfair labour practices and unfair dismissals.
Pay workers equitably.
Work well with people from different cultural orientations.
DIFFERENCES BETWEEN HUMAN RESOURCE MANAGEMENT AND
PERSONNEL MANAGEMENT
Personnel management can be defined as activities “directed at the organisation’s
employees and finding and training them, arranging for them to be paid, explaining
managements expectations, justifying managements actions, satisfying their needs,
dealing with their problems, and seeking to modify managements actions that could
produce an unfavourable response” (Storey, 1992:6).
The above definition shows that personnel management occupies a middle position
between management and employees. Personnel management places a high priority on
employees’ attitudes, interests, and responses (Guest, 1987). In some cases, personnel
management identifies more with the employees than with the management.
Human resource management, on the other hand, is directed not just to the needs of the
employees but emphasis is placed on the planning, monitoring and commitment than
problem solving and mediation (Torrington 1995). Human Resource Management is
concerned with the entire life of the employees at work; from entry to exit. It enables
goals and values of the individual and those of the organization to be integrated and
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achieved (Handy 1985). Personnel Management has thus evolved to become human
resource management.
Armstrong (1998) argues that Human Resource Management adopts a more strategic and
far-reaching approach as opposed to the Personnel Management, which is characterised
by a less dynamic and short- term view of the organisation and its needs.
The major areas of differences are as below:



Personnel Management is about administration and procedures while Human
Resource Management is about a strategic approach to the acquisition, motivation,
and management of an organisation’s human resources.
Human resource management adopts the executive roles and transfers the
personnel management aspects to the level of line management. Human resource
managers often adopt advisory roles as opposed to purely functional and
implementation roles.
Personnel management is pre-occupied with the day to day running of the
organisation while human resource management adopts an advisory role and
attempts to ensure that the organisation’s activities are closely linked with its
corporate strategy and that they fit into the culture of the organisation (Handy,
1985)
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TOPIC TWO:
CHALLENGES OF MODERN HUMAN RESOURCE
MANAGEMENT
Topic objectives
After studying this topic, the student should be able to:




Understand the political challenges experienced by human resource managers;
Understand the economic challenges experienced by human resource managers;
Understand the socio-cultural challenges experienced by human resource
managers;
Understand the technological challenges experienced by human resource
managers.
INTRODUCTION
The practice of human resource management is being constrained by many problems
caused by constant changes that are occurring both within and without the firm. There is
need to understand these changes and devise appropriate response mechanisms. If this
does not happen, then the firm may not survive and achieve its objectives.
For easier understanding, the challenges can be categorized into politico-legal, economic,
socio-cultural, and technological constraints. (PESTEL)
1. POLITICAL CHALLENGES
In many countries decisions of politicians through the parliament have a great impact on
the activities of the human resource managers. e.g.
 government withdrawal of trading licenses
 government reducing or eliminating certain taxes or regulatory barriers
 powerful politicians may also influence hiring and promotion decisions
 government offering tax incentives
 government entering into trade agreements with other nations.
 Government laws regarding employees (minimum wage)
2. ECONOMIC CHALLENGES
Price level changes have led to inflation leading to high prices of many raw materials and
even the finished goods and services. The price of oil and other fuel supplies deserves a
mention because many firms use petroleum related products in the production of their
goods or in the delivery of their services. Increases in taxes cannot be ignored. The rise
of economies such as China has also had its effects on the operations of firms in other
countries. Foreign multinational enterprises often increase competition for local firms.
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3. SOCIO-CULTURAL CHANGES
There are many social changes that are taking place and which are affecting human
resource practices. These changes include the following:
a)





Labour market changes
Mass education of employees on both full time and part time
The need to reorganize and redesign jobs according to qualifications
The increase in the number of female employees
Professionals are typically less inclined to join labour unions, but they have
greater expectations in terms of individual treatment by management.
More and more tasks formerly performed by unskilled labourers have been taken
over by machines.
b) Change in the values of the workforce
In the past most workers had a set of values generally characterised by the term "work
ethic". Work was regarded as having a spiritual meaning, and it was emphasized by such
behavioural norms as punctuality, honest, diligence, and frugality. Employees took their
jobs very seriously.
Perhaps one of the most relevant work redesigning strategy is the use of flexible working
arrangements. These include the flexible working day (flexitime), compressed workweek
and the flexible working year (flexi year).
Job sharing occurs when two or more employees working on a part-time basis divide the
work, time and pay among themselves. This arrangement may be suitable for employees
who have family commitments or older employees who may regard part-time work as a
compromise between full-time work and retirement. Some organizations are critical of
job sharing because it is more expensive to run and harder to manage. Difficulties can
arise if one employee leaves or wishes to work full time.
c)
Changing Expectations of Employees
Modern employees have greater expectations from their employers. Through working,
they expect to buy good homes, cars, food, and clothing. They also expect to make
enough money to educate their children in excellent schools and to buy luxurious goods.
Employees are also resisting the traditional master - servant relationships that simplified
the relationship between the employer and the employees. Instead, employees want to
contribute in decisions that affect them. Some employees are joining labour unions in an
effort to pressurize management for material things such as higher wages and more fringe
benefits, and also to demand for fair treatment, freedom from discrimination, and a say in
matters affecting them.
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d)
Changing Levels of Productivity
In many countries, the human resource manager is faced with the acute problem of
declining productivity. Productivity is the output per employee. The reasons for this
decline in productivity include various government regulations which have added to the
cost of doing business without enhancing productivity in the short run, such as laws
relating to environmental protection, health and safety, affirmative action and so on.
Affirmative action laws have also led to more females and minorities being employed.
Initially such employees may be less productive.
e)
Epidemics
Modern employees are exposed to a wide range of epidemics which include HIV/ AIDS,
Ebola, Asian Bird Fu etc. These epidemics often affect many people and results to
numerous losses of life. The end result is fewer workers and the loss of valuable skills
which take a long time period to develop.
f)
Regional Conflicts
These are also a major challenge especially in third world countries. Political
disagreements often result to conflicts, loss of life, and the displacement of numerous
other people.
g)
Natural Disasters
These include floods, droughts, earthquakes, and mudslides among others. Examples are
El-Nino, La-Nina, Tsunami, and Katrina. These natural disasters often lead to massive
loss of lives and property.
h)
Leaner Workforce
The human resource manager is faced with the challenge of having to maintain a leaner
workforce in an effort to cut costs. The result is an overburdened workforce which is
prone to stress and burnout.
i)
Discrimination
It is difficult to get rid of all forms of discrimination in the workplace. The human
resource manager often has an uphill task trying to eliminate discrimination based on
tribe, race, gender, religion etc
4. TECHNOLOGICAL CHANGES
Rapid changes in technology are forcing organizations to spend more on acquiring the
technologies and on training the workers on the use of these technologies.
Human resource managers may need to seriously consider the effects of the latest
technological developments in existing systems as well as the additional training that may
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be required. External experts may be needed to introduce new technologies and to train
the existing staff. And the technology may need to be kept updated regularly.
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TOPIC THREE: HUMAN RESOURCE POLICIES
Topic objectives
After studying this topic, the student should be able to:







Define human resource policies;
Explain the reasons for adopting human resource policies;
Understand the importance of writing down policies;
Understand the sources of human resource policies;
Explain the procedure for formulating policies in organizations;
Understand how policies are communicated in organizations;
Identify the various human resource policy areas.
INTRODUCTION
A policy is a plan of action. It is a statement of intention committing management to a
general course of action. A policy statement is specific. It commits management to a
rather definite course of action.
A policy is a statement of intended conduct, or a rule of behaviour, which is intended to
apply across the organisation. It is an expression of the organisation’s values and beliefs
concerning all the major functions of the enterprise. Ideally policies tell us how the
organisation intends to go about achieving its objectives.
WHY SHOULD ORGANIZATIONS ADOPT DEFINITE POLICIES?
Organisations should have clearly established policies because of the following reasons:1. The work involved in formulating human resource policies requires that the managers
give deep thought to the basic needs of both the organisation and the employees.
2. Established policies ensure consistent treatment of all employees throughout the
organisation. Favouritism and discrimination are minimised.
3. Continuity of action is assured even though top management employees change. The
tenure of office of any manager is limited to a certain time period but the organisation
continues. Policies promote stability of an organization in a changing environment.
4. Policies serve as a standard of performance. Actual results can be compared with
policy to determine how well the members of the organisation are living up to
professed intentions.
5. Sound policies help to build employee enthusiasm and loyalty. This is especially true
where the policies reflect established principles of fair play and justice and where they
help people to grow within the organisation.
6. Policies protect the employees from unfair practices in the organisation and vice
versa.
IMPORTANCE OF WRITING DOWN POLICIES
Written policies let everyone know just what kind of treatment they can expect to receive
from management. It lets them to know where they stand in relation to any circumstance
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that occurs. Only when policies are reduced to writing can they be communicated to all
employees.
In large organisations containing many dispersed plants, written policies are almost a
necessity. They ensure reasonably consistent treatment throughout the company on
matters such as pay, promotion, transfer, lay off, pension rights, insurance benefits,
training opportunities, and grievance handling.
SOURCES OF FORMULATING HUMAN RESOURCE POLICIES
There are five principal sources for determining the content and meaning of policies.
1. Past practices in the organisation
2. Prevailing practices among other companies in the community and throughout the
nation in the same industry
3. The attitudes and philosophy of middle and lower management
4. The attitudes and philosophy of the board of directors and top management
5. The knowledge and experience gained from handling countless personnel problems
on a day-to-day basis.
6. The law of the country is a major consideration when formulating policies.
PROCEDURE FOR FORMULATING POLICIES IN ORGANIZATIONS
The following steps should be taken when formulating or revising human resource
polices. It is very important to gain an understanding of the corporate culture of the
organisation and how this affects work patterns. Nevertheless the steps below can be an
appropriate guide for establishing policies (Armstrong, 2006).
1. Analyse existing policies existing in the organization whether they are written or
unwritten
2. Analyse external influences such as employment laws, health and safety laws etc.
3. Assess any areas where new policies are needed or existing policies are inadequate
4. Seek the views of employees, managers and trade union representatives.
5. Analyse the information obtained in the steps above and prepare draft policies
6. Consult, discuss, and agree policies with the concerned parties.
7. Communicate the policies to the stakeholders and supplement the communication
with training.
COMMUNICATING POLICIES
Human resource policies must be communicated to everyone within the organisation. A
real education program should be set up to teach all management personnel how to handle
various human resource problems in the light of the newly created policy.
The most common way of informing non-supervisory employees is by means of the
employee handbook. But to achieve real understanding this should be followed up with an
oral explanation and interpretation generally by first-line supervision.
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HUMAN RESOURCE POLICY AREAS
Policies are normally laid out in all areas of the organization. The human resource
department should have policies relating to the following areas of its operations.
1. Human Resource Planning – this is a commitment by the company to planning
ahead in order to maximise the opportunities for employees to develop their careers
within the organisation and to minimise the possibility of compulsory redundancy.
2. Quality of Employees - an organisation may deliberately set out in its policy
statement that, as a company dedicated to the pursuit of excellence and
professionalism, it believes in recruiting people who have the ability or potential to
meet the high standards of performance that will be expected of them.
3. Promotion - The policy should state the company's wish to promote from within
whenever this is appropriate as a means of satisfying its requirements for high quality
staff. The policy should, however, recognise that there will be occasions when the
organisation’s present and future human resource needs can only be met by
recruitment from outside. A firm can have a policy such as:
“All vacancies will be first advertised within the organisation before being made
public”
4. Equal Opportunity - A reference should be made in the general employment policy
statement to the effect that the firm is an equal opportunity company. The Equal
Employment Opportunity policy should spell out the company's determination to give
equal opportunities to all, irrespective of gender, race, creed, disability, age, or marital
status.
5. Managing diversity policy – this is concerned with how the organisation manages
the diverse people it employs. Such a policy would recognize that there are
differences among employees and that these differences, if properly managed, will
enable work to be done more efficiently, and effectively. Managing diversity policy
will acknowledge cultural and individual differences in the work place, state that the
organisation values the different qualities which people bring to their jobs, emphasise
the need to eliminate bias in all areas related to human resource, and focus attention
on individual differences rather than group differences.
6. Ethnic Monitoring – this policy states how the company deals with monitoring the
employment of ethnic minorities.
7. Age and Employment - The policy would define the approach the company adopts to
engage, train and promote all employees especially the older employees.
8. Redundancy - The redundancy policy, could state the organization will do its best to
avoid declaring employees redundant. However, if redundancy is unavoidable then it
will be done in the best way possible.
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9. Discipline - The disciplinary policy should state that employees have the right to
know the rules of the organization and what would happen when a certain rule is
disobeyed. A good example of a policy in this area is:
“Every employee will have the right to fair treatment in matters of discipline”.
10. Grievances - the policy should state how employees can go about solving their
grievances.
11. Sexual harassment - the policy would express the firm’s strong disapproval of sexual
harassment and the measures taken to eliminate it. These policies can:
 Define sexual harassment
 State unequivocally that sexual harassment at work is not tolerated and is regarded as
a matter of gross misconduct
 Define the role of managers in preventing harassment, and dealing with complaints
 Provide for counselling services for those concerned about harassment
Set out the procedure for dealing with harassment
11. Smoking - the policy would define no-smoking rules. Smoking policies will spell out
whether or not there is a complete ban on smoking and, if not, the arrangements for
restricting smoking to designated smoking areas.
12. Substance Abuse – policies here concerned how the company treats employees with
drinking or drug abuse problems.
13. Health and Safety Policy – it is concerned with how the company approaches the
employment of people who have health problems including those who are HIV
positive or actually suffering from AIDS. Such policies cover how the company
intends to provide health and safe places and systems of work.
14. Pay Policy - a pay policy could cover matters such as paying market rates;
Paying for performance; Gain sharing - sharing in the gains (added value) or profits of
the company; providing an equitable pay system; equal pay for work of equal value,
subject to overriding market considerations. An example of a policy here would be:
“Pay levels will be maintained so as to compete with the best in the industry”
15. Employee Development Policy - This policy should express the firm’s commitment
to the continuous development of the skills and abilities of employees in order to
maximise their contribution and give them the opportunity to enhance their skills,
realise their full potential and advance their careers. A development policy includes:
“Employees will be expected to participate in training and development activities in
order to develop their skills”
16. Involvement and Participation Policy - this policy should spell out the firm’s belief
in involvement and participation as a means of generating the commitment of all
employees to the success of the enterprise. The policy could also refer to the basis
upon which the company intends to communicate information to employees. An
example of a policy here is:
“No organisational changes will be implemented without thorough consultation with
all those directly affected by the changes”
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17. Employee Relations Policy - this policy will state the company's commitment to
allowing employees to represent their interests to management through trade unions,
staff associations or some other form of representative system. It will also state the
terms under which the company works with trade unions. The policy may emphasise
that the organisation perceives trade unions as partners. The policy may be stated as
follows:
“The firm will always negotiate in good faith with trade union representatives”
18. New Technology Policy - such a statement would refer to consultation
about the introduction of new technology and to the steps that would be
taken by the company to minimise the risks of compulsory redundancy.
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TOPIC FOUR: STRATEGIC HUMAN RESOURCE PLANNING
Topic objectives
After studying this topic, the student should be able to:



Define human resource planning;
Understand the aim of human resource planning;
Explain the human resource planning process.
DEFINITION OF HUMAN RESOURCE PLANNING
The purpose of human resource planning is to assess where the organisation is, where it is
going, and what implications these assessments have on future supplies and demands for
human resources. Attempts must be made to match human resource supply and demand,
making it compatible with the achievement of the organisation’s future objectives.
Human resource planning is the process by which an organisation ensures that it has the
right number and kinds of people at the right time, in the right places capable of
performing the tasks necessary to achieve the organisations objectives (Armstrong M:
2001; 357)
Human resource planning is the process for ensuring that the human resource
requirements of an organisation are identified and plans are made for satisfying those
requirements. Human resource planning is based on the belief that people are an
organisation’s most important strategic resource and matches resources to business needs
(Bulla and Scott: 1994)
THE AIM OF HUMAN RESOURCE PLANNING
Human resource planning aims to:





Obtain and retain the number of people it needs with the skills, expertise and
competencies required
Make the best use of its resources
Anticipate the problem of potential surpluses or deficits of people
Develop a well-trained and flexible workforce
Reduce its dependence on external recruitment when key skills are in short supply by
having a reservoir of its own employees.
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THE STRAGEGIC HUMAN RESOURCE PLANNING PROCESS
Human resource planning involves matching the available employees with the jobs to be
performed and taking care of the shortages and overloads that might be detected. This
can be shown in a figure as below:Strategic Planning
Human Resource Planning
Find out what is available
Demand = Supply
(No action)
Compare
Forecast the HR Requirement
Demand > Supply
(Action).
Demand < Supply
(Action)
Steps in Human Resource Planning
1. Assessing the current human resources of the organisation
2. Assessing where the organization is going (objectives)
3. Forecasting the supply and demand for human resources
4. Matching demand and supply
5. Dealing with overloads
6. Outplacement services
7. Dealing with Shortages
1.
Assessing the current human resources in the organization
The human resource manager begins by developing a profile of the current human
resources in the organisation. The basic source of data on employees and their skills is
the human resource records of the organisation. The combination of a skills audit and
jobs audit will enable the human resource managers to:
 Determine whether there are any imbalances in the ages or gender of the
employees.
 Highlight areas of skills shortages which can be filled through training or
recruitment of more staff.
 Work out a succession plan for the organization
 Decide how to use the existing staff. It may be necessary to work out overtime
schedules.
 Analyse the rates and reasons for labour turnover.
 Identify the cost implications of any HR decision taken.
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2.
Assessing where the organisation is going
The organisation’s objectives and strategies for the future determine future human
resource needs. Demand for human resources is a derived demand in the sense that it
results from the demand for the products or services of the organization. Based on
estimates of total revenue, the organisation can attempt to establish the number and mix
of resources needed to reach these revenues.
3. Forecasting the supply of human resources in the future
The human resource manager should forecast the future supply of human resources from
both internal and external sources. Demand forecasting is the process of estimating the
future numbers of people required and the likely skills and competencies they will need.
The demand forecasting techniques that can be used to produce quantitative
estimates of future requirements
a).
Managerial or Expert Judgement
This method simply requires managers to sit down, think about future workloads, and
decide how many people will be needed to efficiently undertake the workloads.
b).
Ratio-trend Analysis
This is carried out by studying past ratios between, say, the number of direct (production)
workers and indirect(support) workers in a manufacturing plant, and forecasting future
ratios, having made some allowance for changes in organisation or methods.
c).
Work Study Techniques
Work study techniques can be used when it is possible to apply work measurement to
calculate how long operations should take and the number of people required. Workstudy techniques for direct workers can be combined with ratio-trend analysis to calculate
the number of indirect workers needed.
4. Matching demand and supply of human resources
The objective of human resource planning is to bring together the forecast of the future
demand and supply. The result of this effort will be to pinpoint shortages both in number
and kind; to highlight areas where overstaffing may exist (now or in the future); and to
keep informed of the opportunities that exist in the labour market to hire good people,
either to satisfy current needs or to stock pile for the future.
Thus comparisons are done on what is available and what is required. This comparison
assists the human resource manager to identify any gaps that may exist and to come up
with the necessary plans to fill in the gaps.
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Ideally the demand for human resource is equal to supply. If the demand is equal to
supply then no action needs to be taken. However, there are cases where the demand is
greater than the supply. The organisation should employ more people if the demand is
greater than the supply. However, if the supply is greater than demand, the organisation
should reduce its workforce.
5. Dealing with overloads or surplus
A surplus means that the organisation has more people than it requires. An organisation
with more people than it needs could do the following in order to downsize:
a)
b)
c)
d)
e)
f)
g)
h)
Stop recruitment
Natural wastage or attrition
Early retirement/ buyouts
Lay offs – these can be temporary or permanent.
Leaves of absence without Pay
Redeployment/transfer
Reducing overtime
redundancy
6. Outplacement Services
These can be referred to as a group of services offered to displaced workers especially
those who lost their jobs involuntarily due to reasons such as plant closures.
The range of outplacement services include:
 Personal career guidance and counselling
 Resume’ preparation
 Typing services
 Training on interviewing workshops.
 Referral assistance
Reasons for Outplacement
1. Cost – helping workers find jobs more quickly can cut down on unemployment
benefits. This is especially the case in situations where the law requires displaced
workers to be paid until they get other jobs.
2. Company image – outplacement efforts typically project the image of the company
as a caring employer. Such a firm may not experience a lot of difficulties in future
when it wants to get new employees.
3. Legal issues – the longer employees are out of work, the more likely they are to
consider suing for damages.
4. Social responsibility – some people believe that employers have a moral or ethical
obligation to former employees.
Typically, outplacement is done using outside firms that specialise in providing such
assistance.
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7. Dealing with Shortages
If the results of human resource planning indicate a shortage the following steps should
be taken:
 Outsourcing
 Use of temporary employees
 Careful use of overtime
 Part-time employees
 Recruitment
CONCLUSION
Human resource planning is a key element for the success of any organisation. The
environment and customer needs keep on changing. When this happens, the whole
business set up in an organisation has to change. This makes management of human
resource challenging and more complex. The human resource manager should make
human resource planning a continuous process for the organisation to achieve its goals.
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TOPIC FIVE: RECRUITMENT AND SELECTION
Topic objectives
After studying this topic, the student should be able to:




Define Recruitment and Selection;
Identify the various sources of recruitment;
Understand the various selection methods used to select employees;
Understand the importance of induction and placement of employees.
RECRUITMENT
Recruitment is a positive process of searching for prospective employees and stimulating
them to apply for the jobs in the organization. Recruitment can also be described as those
activities in human resource management which are undertaken in order to attract
sufficient job candidates who have the necessary potential, competencies and traits to fill
job needs and to assist the organisation in achieving its objectives. Through recruitment
an organisation will be able to attract and retain the interest of suitable applicants and to
project a positive image of the organisation to outsiders.
SOURCES OF RECRUITMENT
There are basically two (2) sources of recruitment namely:
 Inside / Internal sources
 External/ Outside sources
INSIDE/ INTERNAL SOURCES
i).
Job Postings: The vacancy can be announced on the firm’s notice boards for any
person who is interested to apply.
ii).
Promotions:
considered.
iii).
Transfers: Involves shifting an employee from one job to another.
Employees who are considered fit for higher positions are
ADVANTAGES OF INTERNAL RECRUITMENT








It is motivating to employees
It promotes loyalty and commitment among employees
Potential of existing employees is already known to the employer
Less induction time since the employee is already used to the organization.
The whole process of recruitment is less costly in terms of time and financial
requirements.
It improves relationship between employees and the top management
It improves the public image of the organization
Reduces the labour turnover.
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

It encourages continuity of the company culture
It is a training device for training employees
LIMITATIONS OF INTERNAL RECRUITMENT





It may lead to the “Peter Principle” whereby one is promoted from their highest
levels of competence to their highest levels of incompetence.
External recruitment will be limited to lower level positions and the new recruits
may be overqualified for the lower level jobs.
It prevents the infusion of new ideas and knowledge that would have been
acquired through external recruitment
Leads to inbreeding whereby the same things are done the same way year after
year.
Source is limited so the best candidate may not be recruited.
EXTERNAL/ OUTSIDE SOURCES
The principal sources and methods for recruiting manpower include:
i).
Employment agencies
These may be public or private. For a fee collected usually from the employee (after
he/she is hired) but sometimes from the employer they help to meet employer requests for
people from their files of job seekers who have registered with them. Many agencies do a
careful job of interviewing, testing, counselling, and screening to match the employer’s
specification and demands and the abilities and needs of the job applicant.
ii).
Labour unions
This source of employees is used primarily in those occupations in which the employees
are represented by trade unions. Some of the industries and occupations, which tend to
obtain some or most of their labour force through unions, are construction and other
companies that deal in manual work. Generally, those union members who have been
unemployed for the longest time are given the first opportunity to fill the job opening..
iii).
Unsolicited applicants at the employment office
For jobs requiring only routine abilities and skills, many employers are able to fill their
labour needs largely by directly hiring at the gate. It is used to obtain many manual
workers and sales people. At other times prospective employees apply directly to the
organisation in the hope that a vacancy exists or they can complete application forms and
send them to the enterprise concerned. This method is cheap and improves the image of
the organisation.
iv).
Employee referral
It is also known as employee recommendations. Some organisations announce to their
own employees that they wish to hire additional people possessing certain type of skills.
The employees would then pass the word to their friends and relatives who may be
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seeking work. The principal advantage of employee recruiting is that it is selective. An
employee would not recommend grossly unqualified persons because he/she feels that
these will reflect adversely upon his/her own reputation. Ideally those recommended are
individuals who are likely to make an excellent contribution to the organisation. This
method is inexpensive and very effective in finding candidates with specific skills
quickly. Employee referral may lead to nepotism whereby individuals hired are related to
those already working in the organisation.
v).
Advertising
Advertising can be done in newspapers, magazines, professional society journals,
Televisions, radio, and public notice boards among other places. This is a widely used
method of recruiting.
vi).
Competitors
This source of recruitment avails persons who are already used to the industry dynamics
and who have their own customers with whom they may move. Nevertheless it can result
to bad blood among the competitors.
vii).
Internet
Through the Internet one is able to attract many recruits from different parts of the world.
viii).
Educational institutions ( i.e. Schools, Colleges, and Universities)
This recruitment practice tends to be utilised by large companies. Such firms usually send
their recruitment teams to the educational institutions to make presentations. Schools,
colleges, and universities avail intelligent and wise employees but sometimes they may
lack the experience required. This problem can be arrested by arranging for internships of
students. Further, the rate of labour turnover is very high especially among younger
school or college leavers. They quickly take advantage of opportunities for “greener
pastures” unlike elderly employees whose rate of job mobility is lower.
ix).
Professional bodies
Accounting, marketing, HRM, engineering institutions etc look after the interests of their
members by allowing vacancy advertisements in their publications. Opportunities for
networking are also afforded through conventions. Examples are IHRM Zambia.
Marketing institute of Zambia, ZICA etc
x).
Head hunting
Top professional people are hunted through specialised agencies. The persons are
approached personally with an offer to fill a vacancy. Alternatively, an advertisement is
written with the specific person’s CV in mind. Those hunted are highly effective
executives who have the skills to do the job, can effectively adjust to the organisation,
and who are willing to consider new challenges and opportunities.
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xi).
Consultants
Recruitment consultants or placement agencies have a broad network base and are
exposed to management in action. They often offer a placement service to client
companies.
ADVANTAGES OF EXTERNAL RECRUITMENT




Large source of applications resulting to selection of the a fully qualified
employee
Employees with wide experience are recruited
Leads to new ideas being introduced to the organization
Organization may save on training costs because highly qualified employees are
recruited.
DISADVANTAGES OF EXTERNAL RECRUITMENT




Costly in terms of time and financial resources
Candidate’s performance is not well known to the employer
Induction has to be done
Demotivating to existing employees
SELECTION
Once recruitment is done the candidates are selected. Selection is a process whereby out
of the many job applicants the best are taken to fill the vacancy.
SELECTION METHODS
1.
Application Forms
To assist the selection process the potential candidates fill in job application forms. This
forms give a common basis for drawing up a shortlist and provides a foundation of
knowledge, which can be used as a starting point for the interview. The information can
also assist the post-interview decision making stage.
Contents of an Application Form
Personal Information
This includes their name, address, telephone number, marital status, date of birth, age,
gender, nationality, languages spoken, tribe, weight and height (body mass index), and
next of kin
Educational Background
 Schools passed through (primary and secondary)
 Further and higher education institutions attended
 Qualifications attained
 Special training
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
Membership to professional bodies
Employment History
 Companies worked for
 Dates of employment
 Positions, duties and responsibilities
 Military service
Other Interests
 Sports
 Hobbies
 Membership to societies/clubs
Referees
 Academic referees
 Work related referees.
2.
Interviews
Most companies pass potential employees through several interviews depending on the
requirements of the job. The interviews can be administered by the human resource
department alone or in conjunction with the departmental management.
3.
Pre-Employment Tests
Tests have been used in an effort to find more objective means of measuring the
qualifications and liabilities of potential employees. An employment test is an instrument
that is used to obtain information about personal characteristics. The main benefit of tests
is that they may uncover qualifications and abilities that would not be discovered by the
interview and application form. Tests will also eliminate the prejudices and biases of the
interviewer and selection panels.
Characteristics of good tests
A good test has the following characteristics




It is a sensitive measuring instrument that discriminates well between subjects.
It has been standardized on a representative and sizable sample of the population for
which it is intended so that any individual’s score can be interpreted in relation to that
of others.
It is reliable in the sense that it always measures the same thing.
It is valid in the sense that it measures the characteristic which the test intended to
measure.
Type of Tests
The main types of tests are:
 Aptitude tests
 Personality tests
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





Psychometric tests
Skills tests
Work sample tests
Work styles or traits tests
Specific knowledge tests
Medical tests
Some of the tests are briefly discussed below.
Aptitude tests
These measure the general intellectual ability of a person.
Personality tests
These tests are designed to reveal the candidates personal characteristics and the way
candidates may interact with others, thereby giving a measure of leadership potential.
These are to identify the candidates’ personality types. Personality concepts of
importance to the human resource manager include whether one is an extrovert or
introvert, sensate or intuitive, thinking or feelings led, etc. other aspects of personality
tests are stress, simulation, novelty, dominance, and achievement.
Psychometric tests
A psychometric test is a way of assessing a person’s ability or personality in a measured
and structured way. The main psychometric tests are personality, ability, and interest
tests.
skills tests
These are job specific and tests ones ability to perform a relevant task. A typing test is a
skills test just like headline writing.
Work sample tests
The candidate is asked to produce a sample of their work. A typist may be asked to type
some work.
Work styles or traits tests
These are intended to find out how one likes to work. An individual can like working
alone or with others, as a leader or as a follower. Some individuals like to be praised
while others prefer freedom. These tests are administered through a series of questions to
be answered with a “yes” or “no” response, or choosing the response from a number of
choices. In these tests, there are no right and wrong answers.
Specific knowledge tests
These tests measure how much one knows of a particular subject- such as knowledge of
sports.
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Medical tests
The aim of medical tests are to determine any major medical conditions of the potential
workers that may affect their performance.
Reference checks
These are conducted after the employment interview to find out more about an applicant’s
employment record, education and training, and behavioural patterns. It is strongly
recommended that one chooses referees who know him/her very well and who can give
accurate information. The referees may also be educators who had the opportunity to
interact with the person in a classroom setting.
INDUCTION AND PLACEMENT
Induction is the socialisation or orientation programme aimed at gradually introducing the
new employee to the organisation, the work unit in which he or she will be working, the
particular work and the people and things which he or she will be working with. Through
induction the new comer will feel at ease much quickly. Induction introduces the new
employee to the organisation. The length of time taken on the induction exercise will
depend on the size and complexity of the organization as well as on the level in the
organization at which the employee is entering among other factors.
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TOPIC SIX: EMPLOYEE TRAINING AND DEVELOPMENT
Topic objectives
After studying this topic, the student should be able to:




Define training and development;
Explain the reasons for training employees;
Understand the principles of learning;
Understand the training and development process.
DEFINITION OF TRAINING AND DEVELOPMENT
Training consists of planned programs designed to improve performance at the
individual, group, and/or organisational levels. Improved performance, in turn, implies
that there are measurable changes in knowledge, skills, attitudes, and/or social behaviour.
Training is a learning process whereby people acquire skills or knowledge to aid in the
achievement of goals. In a limited sense, training employees provides them with specific,
identifiable knowledge and skills for use on their present jobs.
Training is normally viewed as a short process. It is applied to technical staff, lower,
middle, senior level management. When applied to lower and middle management staff it
is called training and for senior level it is called managerial development
program/executive development program/development program.
Development is broader than training in that the individuals gain new knowledge and
skills useful for both present and future jobs (Mathis $ Jackson, 2000).
Training seeks a relatively permanent change in an individual which change will improve
his/her ability to perform on the job. Training typically involves the changing of skills,
knowledge, attitudes, or social behaviour. It can involve changing what employees know,
how they work, their attitudes towards their work, or their interactions with their coworkers and their supervisors.
Ideally training is job related learning that employers provide to their employees. The
main aim is to improve employees’ skills, knowledge and attitudes so that they can
perform their duties according to set standards. In contrast to training (which is job
related) and education (which is the preparation of an employee for a different job),
employee development is a broad term which relates to training, education, and other
intentional or non intentional learning and which refers to general growth through
learning.
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OBJECTIVES OF TRAINING
Training is necessary for the following reasons:
a).
Improving quality of work force
Training and development help companies to improve the quality of work done by their
employees. Training programs concentrate on specific areas. There by improving the
quality of work in that area.
b).
Enhance employee growth
Every employee who takes development program becomes better at his job. Training
provides perfection and required practice, therefore employee’s are able to develop them
professionally.
c).
Prevents obsolescence
Through training and development the employee is up to date with new technology and
the fear of being thrown out of the job is reduced.
d).
Assisting new comer
Training and development programs greatly help new employees to get accustomed to
new methods of working, new technology, the work culture of the company etc.
e).
Bridging the gap between planning and implementation
Plans made by companies expect people to achieve certain targets within certain time
limit with certain quality for this employee performance has to be accurate and perfect.
Training helps in achieving accuracy and perfection.
f).
Health and safety measures
Training and development program clearly identifies and teaches employees about the
different risk involved in their job, the different problems that can arise and how to
prevent such problems. This helps to improve the health and safety measures in the
company.
CONCEPT OF LEARNING AND ITS PRINCIPLES
In order to understand what training techniques can do to improve an employee's job
performance it is necessary to understand the concept of learning. Ideally learning is the
process of knowing what was previously not known.
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PRINCIPLES OF LEARNING
a).
Learning is enhanced when the learner is motivated
An individual must want to learn. When the desire exists, the learner will exert a high
level of effort. People are more willing to learn when the material is important to them
and will help them to achieve the goals they have set for themselves. Some of the goals
that may encourage intention to learn in certain people include the desire for achievement,
advancement, authority, co-workers influence, comprehension, creativity, curiosity, fear
of failure, recognition, responsibility, status, and a variety of other reasons.
Further, trainees must perceive the organisation and their immediate work environment as
supporting participation in training and using what has been learned. If they perceive the
organization as not supportive then they will not be motivated to learn.
b).
Learning requires feedback
Feedback, or knowledge of results, is necessary so that the learner can correct his/her
mistakes. Feedback, or knowledge of results, is best when it is immediate rather than
delayed. Immediate feedback can come from observers, the performer, or the task itself.
The sooner individuals have some knowledge of how well they are performing, the easier
it is for them to correct their erroneous actions. When individuals obtain feedback on their
performance, the task becomes more intrinsically interesting and acts to motivate them.
c).
Reinforcement increases an individual’s likelihood of repeating a learned
behaviour
Reinforcement can be positive (to encouraged or sustain a desired behaviour) or it can be
negative (to suppress unwanted behaviour).
Punishment (negative reinforcement) tells learners that they are doing something wrong.
When workers are verbally praised upon properly performing a task, it encourages
learning and they are likely to continue doing the task in that way; they will even be
motivated to strive toward performing better work. Thus, positive reinforcement
encourages learning.
d).
Practice increases a learner's performance
Anyone learning a new skill or acquiring factual knowledge must have an opportunity to
practice what he/she is learning. When learners actually practice what they have read,
heard, or seen, they gain confidence and are less likely to make errors or to forget what
they have learned. Active involvement through practice must be made part of the learning
process.
e).
Learning curves
Learning begins rapidly, and then levels off. The rate of learning can be expressed as a
curve that usually begins with a sharp rise, and then increases at a decreasing rate until a
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plateau is reached. Learning takes place very fast at the beginning, but then levels off as
opportunities for improvement are reduced.
Amoun
t of
learnin
g.
Common
learning
curve.
Time
f).
Transfer of learning
Transfer refers to the extent to which competencies learned in training can be applied on
the job. Positive transfer occurs when job performance is improved as a result of the
training. Zero transfer occurs when there is no change in job performance as a result of
the training. Negative transfer occurs when job performance is worse as a result of the
training.
Near transfer occurs when the material learned can be directly applied on the job with
little adjustment or modification, while far transfer occurs where the material learned
must be modified or expanded upon before it is used.
g).
Split the material into meaningful chunks rather than presenting it all at once
Trainees can absorb only a limited amount of information at a time. In situations where
the subtasks learned are relatively easy to perform and are inter-related, all the material
can be learned at once. An example is learning how to operate a power saw. Otherwise
the material must be broken down into reasonable chunks and presented at different
times.
h).
Try to use terms and concepts that are already familiar to trainees
The use of jargons and unfamiliar terms should be discouraged. Where new concepts and
terms are to be used, then the familiar terms and concepts should precede them.
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i).
Maximise the similarity between the training situation and the work situation
The principle of identical elements suggests that the more similar the training and the
performance situations are in terms of the stimuli present and the responses required, the
more likely it is that training transfer will occur. Customer care experts who are expected
to work with angry, impatient customers should practice with role models of such
customers. The similarity can be in terms of physical elements such as equipment, tasks,
and surroundings; it can also be psychological.
j).
Label or identify important features of the task
Where the training relates to the use of machines then important operations must be
labelled. Examples are the "starter switch" or the “stop switch”.
k).
Trainees learn best when they learn at their pace
This is because some are slow learners while others are fast learners.
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THE TRAINING AND DEVELOPMENT PROCESS
The process of training and developing employees can be shown in a simple diagram as
below.
Fig 1: The training and development process
Conduct a training needs analysis
Establish the training objectives
Select the training methods and
Conduct the training
Evaluate the training
A).
TRAINING NEEDS ANALYSIS
In order to know what to train workers on, it is necessary to carry out a Training Needs
Analysis. The training needs analysis finds out what training or development employees
actually need and want to acquire, and the conditions which are necessary for ensuring
that training or development will be practically useful to the organisation.
To know that employees need training the manager can get a clue from:








Decreased productivity;
More grievances reported;
Complaints from customers;
Equipment utilization figures;
Training committee observations;
A high reject rate;
Greater than usual scrape or wastage of materials;
A rise in the number of accidents reported;
Changes imposed on the employees as a result of job redesigns or a technological
breakthrough.
Nevertheless, it should be known that employees might not excel in their performance
because of other reasons such as: Low managerial authority;
 Ambiguous job descriptions;
 Haphazard (random) personnel management activities;
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 Low motivation, morale and job description.
Some of the methods used for assessing training needs include:











Observation and analysis of performance;
Management and staff conferences and recommendations;
Analysis of job requirements;
Consideration of current and projected changes;
Surveys, reports, and inventories of current employees;
Interviews with incumbents, supervisors and clients;
Assessment centres;
Questionnaires;
Diaries;
Coaching;
Work planning and review systems;
Collection of critical incidents.
Managers should be able to differentiate between competence and performance.
Competence refers to the ability to do certain jobs while performance is the
achievement of practical results in a work situation.
For training to be conducted there has to be a performance gap between the desired or
optimum level of performance and the actual or real level of performance.
Some organisations do not conduct a training needs assessment because of reasons such
as: The needs assessment exercise can be a difficult, time consuming process.
 Managers may decide to use the limited resources available to develop, acquire, and
deliver the training rather than to do the preliminary activities.
 Incorrect assumptions are made that a needs assessment is unnecessary because
available information already specifies what an organisation’s needs are.
 There may be lack of support from the top management.
 Some of the trainees may resist the needs assessment exercise because of the benefits
they get from their current positions or where they don’t trust their supervisors. This
is sometimes the case in public service positions.
Needs assessment should be done at the organisational level to determine where training
is needed and in what conditions the training will be conducted. It is also done at the task
level to determine what must be done to perform the jobs more effectively. At the
personal level needs assessment helps us to know who should be trained and the kind of
training they need.
B).
ESTABLISH TRAINING OBJECTIVES
Management must explicitly state what changes or results are sought from each
employee. These goals should be tangible, verifiable, and measurable (as far as this is
possible). They should be clear to both management and the employee. The clarity of
goals is influenced by how they are communicated. The goals should be in line with the
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problems that gave rise to the training. An example would be improved productivity of
the workers. The objectives should be written down as concisely as possible using a
language that can be easily understood by all the interested parties.
Examples of training objectives would be as follows: to increase the productivity of the firm within one year;
 to reduce the rate of wastage or scrappage; or
 even to reduce customer complaints.
C).
SELECTING THE TRAINING METHOD AND CONDUCT TRAINING
Appropriate training methods should be able to: Motivate the employees to improve their performance;
 Explicitly illustrate the skills desired by the employee;
 Make employees to participate effectively in their work assignments;
 Provide the trainee with the opportunity to apply the skills in the practical work
situation;
 Provide immediate feedback on employee performance during training.
Human resource managers must make the decision as to whether the training will be
provided by the firm’s staff or by external parties. This decision is made considering the
following factors.
i).
Expertise: when the firm lacks the knowledge, skills, and experience to design
and implement a training program, then it must rely on external parties.
ii).
Timelines: sometimes it is timelier to hire outsiders to undertake
the training.
Number of trainees: where there are many trainees then it may be more cost
effective to offer the training using the firm’s personnel.
iii).
iv).
Subject matter: in cases where the subject matter is sensitive, then the firm’s
employees become the trainers.
v).
Cost: this factor should be considered together with the other
factors.
vi).
Size of the human resource department: smaller departments may lack the
capacity to train employees.
vii).
Other factors: these include personal contacts or past experiences with an
outside vendor, geographical proximity to the vendor, local economic conditions,
and the presence of the government incentives to conduct training.
Each external party wishing to provide the training would need to be evaluated in terms
of their cost, credentials, experience, background, delivery method, topics they wish to
cover, and expected results among other factors.
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It is also necessary to select the trainer(s) and train them before they embark on the
training. Lesson plans should be prepared in which issues such as topics to be covered,
sequence of the activities, and timing of each activity among others are discussed.
Classification of Training Methods
Training methods can be classified as either on-the-job or off-the-job.
On The Job Training (OJT)
This is one of the widely used methods of training. The employee is physically in the
work environment and appears to be immediately productive. It is learning while doing.
This is known in some industries as “Sitting with Nelly” implying that one person sits
under another in order for the learner to learn from the experienced person.
Advantages of On the Job Training





The transfer of training to the job is maximised;
The costs of a full time trainer and training facilities is eliminated;
The employees are more motivated because they know that what they are learning is
relevant to their job. Theory is put into practice immediately and its relevance is
obvious;
Much of the learning takes place naturally as part of the performance management
process and through day to day contacts;
Employees are assimilated more quickly into the organisation.
Disadvantages of On the Job Training




Low productivity while employees develop their skills;
Costly errors made by the trainees while they learn;
The effectiveness of the learning is strongly influenced by the quality of the
guidance and coaching provided on the job. Many managers and team leaders are
unskilled at training and may not carry it out or encourage it;
The environment may distract the instructions.
ON THE JOB TRAINING METHODS
1. Induction training
It enables a new recruit to become productive as quickly as possible. The length of
induction training will vary from job to job and will depend on the complexity of the job,
the size of the business and the level or position of the job within the business.
The following areas may be included in induction training:



Duties of the job;
How to meet new challenges;
Information concerning the layout of the premises;
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



2.
Values and aims of the business;
Internal working and policies of the business;
The history of the firm including the former and current leadership regimes.
The goods and services of the firm.
Coaching
Here experienced managers guide the actions of less experienced managers to help them
develop their service delivery. It is one of the most effective training techniques. The
teaching is individualized and one learns by doing. This method provides immediate
feedback on performance. Nevertheless, it tends to propagate the ideas of current
managers and some of the ideas may not be progressive. The superior may also neglect
the person being coached in terms of time and of the quality of teaching efforts.
Sometimes, coaches are hired from outside the organisation, but increasingly some
organisations expect all line managers to operate as coaches, and it is often true that a
young manager will learn more from senior colleagues than from any other source or
formal learning intervention. Coaching focuses on skills and is different from counselling
which is about helping people with personal concerns such as motivation and selfconfidence.
3.
Mentoring
A senior manager is paired with a more junior employee for the purpose of giving
support, helping the employee learn the job, and preparing the employee for increasing
responsibility.
Mentoring actually refers to a developmental relationship between a more experienced
mentor and a less experienced partner referred to as a mentee or protégé. There are two
types of mentoring relationships: formal and informal. Informal relationships develop on
their own between partners. Formal mentoring, on the other hand, refers to assigned
relationships, often associated with organizational mentoring programs designed to
promote employee development.
In other cases, mentoring is used to groom up-and-coming employees deemed to have the
potential to move up into leadership roles. Here the employee is paired with a senior level
leader (or leaders) for a series of career-coaching interactions. A similar method of highpotential mentoring is to place the employee in a series of jobs in different areas of an
organization, all for small periods of time, in anticipation of learning the organization's
structure, culture, and methods. A mentor does not have to be a manager or supervisor to
facilitate the process.
4.
Apprenticeship programs
This is the oldest training method commonly found in industrial organisations. The
apprentice works alongside and under the supervision of a skilled supervisor for a
particular duration of time. A major part of the training time is spent on the job doing
productive work and assignments. It is used for skilled trades such as plumbing,
electronics, mechanics, iron working and carpentry.
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5.
Job rotation
It is also called position rotation and involves training by periodically assigning
employees to alternative jobs or tasks on some planned basis or a rotation schedule. It
may take a period ranging from four months to two years. During this period, the trainee
is supervised by a department employee, usually a supervisor, who is responsible for
orienting, training, and evaluating the trainee. The aim is to broaden the knowledge,
skills, and outlook of trainees although it can be used to stimulate new ideas and to kill
boredom for new or experienced employees. At higher levels of the organisation it can be
used to develop managerial generalists by exposing them to different operations.
Through job rotation, employees are prepared to assume greater responsibility in the
higher levels. Nevertheless, it can de-motivate intelligent and aggressive employees who
seek specific responsibilities. It can also eventually produce a number of employees with
limited job knowledge.
At the senior management levels, job rotation - frequently referred to as management
rotation, is tightly linked with succession planning - developing a pool of people capable
of stepping into an existing job. Here the goal is to provide learning experiences which
facilitate changes in thinking and perspective equivalent to the "horizon" of the level of
the succession planning.
6.
Understudy assignments
Understudying is similar to coaching but it is a full time mentor- understudy arrangement
while coaching is only periodic. The understudy works with the mentor on a daily basis to
learn how the job is done. In this way the understudy will be able to replace the manager
during absences caused by illnesses, retirement, study leave, transfer, promotion, or
death. The manager discusses with the understudy about problems, assigns him or her
duties, allows him or her to participate in decision-making, and attend executive meetings
on behalf of the manager. Sometimes, managers may feel threatened by understudies and
may not assist them as they should. Further, the understudy cannot move into the position
until it is vacated and he or she may learn inappropriate skills from the supervisor.
7.
Committee assignments
It is where a number of junior executives are assigned to committees. Through
discussions in the committees they get acquainted with different viewpoints and
alternative methods of problem solving. They also learn interpersonal skills. The role of
the trainer would be to observe the proceedings, for example, the interpersonal processes,
negotiations, and successes or failures of the committees. Experienced managers may also
participate in the committees.
8.
Project assignment
This is where a number of executive trainees are put together to work on a particular
project related to their functional areas. The project team studies the problem and finds
the appropriate solution.
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9.
Job instruction Training (JIT)
It consists of 4 basic steps:
a. Preparing the trainees, by telling them about the job and overcoming their
uncertainties. Put the trainees at ease, find out what he or she knows, arouse
interest, and place the employee in the correct psychological position. Thereafter,
set up the task
b. Presenting the instructions, giving essential information in a clear manner. Tell,
show, explain, and demonstrate the operations or procedures involved in
performing the job.
c. Practice- it involves having the trainees try out the job to demonstrate their
understanding. Have them explain the steps. Give feedback on performance.
Reinforce the correct behaviour.
d. Follow up- this is placing the workers into the job on their own, with a designated
resource person to call upon should they need assistance. Encourage questioning
and check on their performance periodically. Gradually reduce the training.
10.
Multiple management
This method provides a junior board of young executives that analyses the major
problems and makes recommendations to the Board of Directors. The young executives
learn decision-making skills and the board of directors receives the collective wisdom of
the team. Vacancies in the senior board of directors can be filled from the junior board
members, who have received considerable exposure to the problems and issues dealt with
by the senior board of directors.
OFF THE JOB TRAINING
Off the job training is offered outside the firm. In many cases, the training is organized to
take place in an institution some distance away from the firm. The beauty with off the job
training is that it enables employees to break the monotony of being in the organization
every day. In fact, it is also an opportunity to visit places that were not initially known.
The main methods used to conduct off-the-job training include the following:1. Classroom Lectures, talks and discussions
The participants are sent to attend formalised organised talks by instructors or experts on
specific topics useful to develop philosophy, concepts, attitudes, theories and problem
solving skills. This is the best means for conveying specific information such as rules,
procedures, or methods. It can be supplemented with audiovisuals or demonstrations.
Feedback and active involvement of trainees must be encouraged.
2.
The conference method
It involves sending the employees to attend and participate in professional conferences
where mutual professional plans are developed.
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3.
Seminar or team discussion workshops
Participants are sent for seminars or workshops in various skills or professional courses
where they learn through discussing a paper written by one of the trainees. They are also
provided with professional knowledge on various topics from expert resource persons.
4.
Vestibule school
It is a situation whereby an expert provides training in a classroom with the help of
machines and equipment identical to those in use at the place of work. The aim is to
provide specific job skills with theoretical training taking place in the classroom and
practical work being done in the production line.
5.
Audiovisual media
Films can be purchased from standard film distributors or produced internally by the
organisation, they can provide information and explicitly demonstrate skills that are not
easily presented by other techniques. Video shows demonstrating excellent performance
can also be shown.
6.
Case studies
These present an in-depth description of a particular problem that an employee might
encounter on the job. The employee attempts to find and analyse the problem, evaluate
alternative courses of action, and decide the course of action that would be most
satisfactory. The purposes of a case study are to:
 Show trainees that there is usually no easy solution to complex organisational
problems.
 Demonstrate that business problems are multifaceted and they can only be solved
by borrowing from different disciplines.
 Make trainees realise that different perspectives and solutions to the same case
may be equally valid.
 Help managerial trainees develop their problem solving skills.
7.
Role playing
Learning takes place by letting the trainee assume the role of, say, a salesperson.
Afterwards the trainee is corrected by the trainer and by other trainees. It is learning by
acting.
8.
Special training programs
Certain employees may be taken for further professional or educational studies to
improve their competencies. Examples are the undergraduate or postgraduate degrees,
advanced professional courses in Finance, marketing, human resource and so on. The
same can be done either locally or abroad depending on the organisations training policies
and availability of funds.
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9.
In tray exercises
The managers are given a “basketful” or assortment of invoices, requests, memoranda,
and such like data in respect to a particular organisation, so that they can make sense of
the paperwork by applying appropriate management skills within a limited time. The aim
is to find out how someone reacts when they are under pressure and how they go about
solving the many problems that are the source of the pressure.
D).
EVALUATING THE TRAINING PROGRAM
After a training exposure, it is necessary to evaluate the participants. The aim of the
evaluation is to determine:
 Whether the program achieved its objectives or it failed
 The strengths and weaknesses of the program
 The cost-benefit ratio of the program
 Who should participate in future training programs.
 Which participants benefited most from the training.
 How future programs shall be marketed.
There are many models that have been designed to explain the evaluation of training
programs. These include the works of Kirk Patricks (1994), Galvins CIPP (1983),
Brinkerhoff (1987), Kraiger, Ford, & Salas (1993), Holton (1996), and Philips (1996).
Kirk Patrick’s model is easy to understand and to use. According to Kirkpatrick (1994)
training programs can be evaluated by measuring changes at four levels as discussed
below.
1. Reaction level: It is the most basic level of evaluation. This level measures how well
the participants liked or disliked the training program, whether it was worth the time
and whether it was presented in a meaningful and interesting manner. Reaction can be
obtained by having the participants complete a questionnaire or participant evaluation
form. If trainees enjoyed a programme it does not imply that the programme was very
useful to the organisation, but unpopular programmes may be cancelled due to lack of
interest. At this stage, it is not possible to establish whether the program achieved its
objectives.
2. Learning level: It measures the extent to which the trainee or participant learnt and
retained the material (i.e. the concepts, ideas, and principles) and intellectually
assimilated it. This is done by evaluating the skills or knowledge gained at the end of
the program. Alternatively the evaluation can be done on a continuous basis by using
tests or quizzes. The trainees should be informed in advance about this assessment so
as to increase their alertness and retention. The assessment can be done by using
paper and pencil tests, performance tests and examinations.
3. Behaviourial level: Ideally, training is supposed to modify the behaviour of
employees towards a given direction. At this level of evaluation, the concern is
whether the modified behaviour causes positive results such as better reaction to
customer complaints. Behaviour ratings can be collected from the superiors, peers,
subordinates, or clients of the trained employees.
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4. Results: This is the ultimate value of training. It measures the extent to which the
training produces cost-related behavioural outcomes such as productivity or quality
improvements; reduction in turnover, accidents, customer complaints, reject rates,
scrappage costs, labour turnover; meeting the production quotas; more profitability
among other evaluations.
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TOPIC SEVEN: MANAGEMENT DEVELOPMENT
Topic objectives
After studying this topic, the student should be able to:




Define management development;
Understand the importance of management development;
Explain the management development process;
Design an effective management development programme.
VARIOUS DEFINITIONS OF MANAGEMENT DEVELOPMENT
Management development is more future oriented, and more concerned with education
than employee training. Education means that management development activities
attempt to instil sound reasoning processes - to enhance one's ability to understand and
interpret knowledge. It therefore focuses more on the employee's personal growth.
Management development is an organisation’s conscious effort to provide its managers
(and potential managers) with opportunities to learn, grow, and change, in the hope of
producing, over the long term, a cadre of managers with the skills necessary to function
effectively in that organization (Warner & DeSimone, 2006).
Successful managers have analytical, human, conceptual and specialised skills. They are
able to think and understand problems facing the organizations that they manage.
Management development is thus any attempt to improve current or future managerial
performance by imparting knowledge, changing attitudes, or increasing skills.
Armstrong (2006) says that management development is the process through which
managers learn, improve their skills in their present roles and prepares them for greater
responsibilities in the future.
IMPORTANCE OF MANAGEMENT DEVELOPMENT
Management development contributes to the success of the organisation by ensuring that
the organisation has the managers it requires to meet its present and future needs. Today’s
managers require a wider range of skills than ever before. These include:




Ability to manage people and systems
Ability to work in cross-cultural settings, working with teams
Being able to develop relationships, focusing on customers and building
partnerships
Being able to draw the right balance between technical and “soft” skills.
Probably the main reason for management development is that, in many organizations,
promotion from within is a major source of management talent. Management
development prepares internal managers for their new or prospective jobs.
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Management development facilitates organisational continuity by preparing employees
and current managers to smoothly assume higher-level positions. The life of an individual
is finite but organizations are assumed to have an undefined lifespan.
It also helps to socialise management trainees by developing in them the right values and
attitudes for working in the firm. Only managers with the right attitudes can steer an
organization to greater heights.
Management development should be linked to the organisation’s strategy and structure
for accomplishing its goals. This can be done by ensuring that business issues drive
management development.
THE MANAGEMENT DEVELOPMENT PROCESS
The Management Development Process is carried out through 5 stages as shown below.
1.
Specify the organisation’s objectives
Objectives tell us where the organisation is going and provides a framework from which
managerial needs can be determined. Firms set objectives in the areas of sales,
profitability, return on investments, new product development, expansion into foreign
markets and so on.
2.
Carry out an appraisal of current management resources
The aim of assessment is to determine the existing competences of managers and identify
the gaps. This can be achieved by use of performance assessment tools such as the 360degree appraisals.
3.
Ascertaining the development activities necessary to ensure the organisation
has adequate managerial talent to fulfil future managerial needs
4.
Determine individual development needs
The emphasis can be skill development, changing attitudes, or even knowledge
acquisition. Most management development centres focus on the changing of attitudes
and the acquisition of knowledge in specific areas.
5. Assess the types of development programs that can meet these needs.
This is because no development program can be adequate for all managers. Instead,
programs must be uniquely tailored to the strengths and weaknesses of the individual
manager.
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DESIGNING AN EFFECTIVE MANAGEMENT DEVELOPMENT PROGRAM
In designing an effective management development program, the following guidelines are
recommended:1.
Define the purpose of the program and behaviours to be Developed:
A management development program should be able to demonstrate how it will meet or
contribute to organisational objectives.
2. Find and use organisational support for creating a process not an event:
Activities that lack the support of the total organization, especially the top management,
may not succeed.
3.
The program should be designed to ensure that the individuals to be developed are
motivated to participate in the activities of the program.
4.
Provide feedback on effectiveness of program as well as the progress of the
managers:
It is important to evaluate learning in order to assess its effectiveness in producing the
outcomes specified and/or indicate where improvements or changes are required to make
the training even more effective.
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TOPIC EIGHT: JOB ANALYSIS
Topic objectives
After studying this topic, the student should be able to:






Define Job Analysis;
Explain the purpose of Job Analysis;
Understand what a Job Description is;
Understand what a Job Specification is;
Explain the various methods of analysing jobs;
Understand how jobs are designed.
INTRODUCTION
Before an individual can be hired to perform a job, the requirements of that job must be
identified. Before the level of pay for a job can be established, the qualifications required
in performing the job must be determined. Similarly before the performance of an
employee can be evaluated or a decision can be made as to whether or not an employee is
doing what he/she should be doing, then what the employee should be doing must be
identified. Therefore, before any of these human resource functions can be performed,
there must be a thorough understanding of the domain of the job. To do this, human
resource professionals use a job analysis, which is a means of collecting information
about various aspects of a job.
Results from a job analysis serve as the foundation for many of the human resource
function including selection, compensation, performance evaluation, and training.
DEFINITION OF A JOB ANALYSIS
It is a systematic exploration of the activities within a job. This analysis involves
compiling a detailed description of tasks, determining the relationships of the job to
technology and to other jobs and examining the knowledge, qualifications or employment
standards, accountabilities and other incumbent requirement.
The job analysis indicates what activities and accountabilities the job entails; it is an
accurate recording of the activities involved.
The Job Analysis involves studying jobs to determine what tasks and responsibilities they
include, their relationships to other jobs, and the conditions under which work is
performed, and the personal capabilities required for satisfactory performance.
It is sometimes called "Job Study' suggesting the care with which tasks, processes,
responsibilities, and personal requirements are investigated.
Job Analysis is the study of jobs within an organisation so as to determine the activities
employees perform, the tools and equipment used. It also looks at the working conditions
under which the activities are performed and the minimum required qualifications one
should possess to adequately perform a given job.
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PURPOSE OF A JOB ANALYSIS
Although the Job Analysis is an essential foundation for staffing, it may be used for many
other purposes such as:
1. Determining qualifications required of jobholders
2. Providing guidance in recruitment and selection
3. Evaluating current employees for transfer or promotion
4. Establishing requirements for training programs
5. Setting wage and salary levels and maintaining fairness in wage and salary
administration
6. Judging the merits of grievances that question assignments and compensation
7. Establishing responsibility, accountability, and authority
8. Providing essential guides in the establishment of productions standards
9. Providing clues for work simplification and methods improvement
JOB DESCRIPTION
It provides information on the duties and responsibilities of a particular job. Included in
the information are accurate and concise statements, which show what the jobholder will
do, how the jobholder will perform, the conditions under which the activities will be
performed, standards and time required in performing the activities.
Contents of a job description:
1. Major duties to be performed
2. Percentage of time to be devoted to each duty
3. Performance standards to be achieved
4. Working conditions and potential health hazards
5. Supervisory responsibilities, if any
6. Number of persons required to work on the same job
7. Reporting relationships-who reports to who and how many people report to one
position
8. The tools used to perform the job e.g. machines and equipment
A job description requires periodic, systematic information gathering and review. It
should be in line with the organisation’s objectives and mission.
Job descriptions are used during recruitment, induction of new employees, when deciding
who should be promoted/demoted/transferred, and performance appraisals; they are also
useful in making decisions related to training and development, discipline of the workers
and compensation administration.
JOB SPECIFICATION
It identifies the minimum acceptable qualifications that a jobholder should possess to
perform a given job adequately with minimum supervision i.e. experience, training,
education (primary, secondary or university), knowledge, skills or abilities.
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The information needed required to accomplish a job analysis include:
1.
2.
3.
4.
5.
6.
Employee oriented activities,
Job demands
The form of communication patterns
Knowledge of type of tools
Machines and equipment
Job related tangibles and intangibles as well as standards
METHODS OF JOB ANALYSIS
Since organisations are different, the method used is based on the goals the information
will serve and the suitability of the method to the organisation. The data for job analysis
must be collected from people who are directly or indirectly involved with the job using
any of the following methods:
1.
Observations
An individual at work can be observed to record a brief description of the activities
performed, how they are performed, and the time taken to perform each activity.
However, when an individual is aware that he or she is being observed or recorded s/he
behaves differently from normal. Therefore, efforts should be made to make sure that
individuals who are likely to behave differently from normal are not aware that they are
being observed. This method is most suitable where physical skills are required but is
limited where mental skills are required.
2. Questionnaires
It involves administering a structured questionnaire to employees so that one can identify
the activities they perform in accomplishing their jobs. The questionnaire must capture
the job title, reporting relationships, purpose of the job, and the main tasks and duties.
3. Interviews
Sometimes a good understanding of the activities involved can be obtained by talking to
the employee and to their immediate supervisor to confirm whether both view the job in
the same perspective. Interviewing can be a rather time consuming and costly method of
data collection especially where many employees are involved because the interviewers
must be trained to perform the interviews. Nevertheless, interviews are flexible and they
can avail very important information from the employees.
4. Employee Recordings
The employees can be told to maintain written records of what they do and how they do it
on a daily basis. The activities should be recorded in order of priority immediately after
they have occurred including any specific problems or weaknesses encountered.
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JOB DESIGN
This is the process of determining how specific tasks are combined to form complete
jobs. It also establishes how a particular job relates to other jobs or work in an
organisation. Due to changes in the nature of organisations, economic and technological
factors, jobs have to be redesigned. Two approaches used in job redesign are job
enlargement and job enrichment
Job Enlargement involves expanding a particular job's content horizontally so as to
create a wider variety of duties for the jobholder and so as to reduce boredom. Since the
increased duties and responsibilities are not accompanied by corresponding benefits (e.g.
increased pay or other fringe benefits) it can affect the employee’s morale negatively.
Job Enrichment involves expanding a job vertically i.e. the jobholder is given greater
control over his work, more independence and responsibility. This is actually promotion
since it increases the corresponding compensation and authority.
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TOPIC NINE: JOB EVALUATION
Topic objectives
After studying this topic, the student should be able to:
 Define job evaluation;
 Explain the importance of job evaluation;
 Discuss the methods of job evaluation.
DEFINITION OF JOB EVALUATION
Job evaluation can be defined as a systematic procedure designed to aid in establishing
pay differentials among jobs.
It is also a systematic process of defining the relative worth or size of jobs within an
organization in order to establish internal relativities (Armstrong, 2006).
The aim of job evaluation is to provide a systematic and consistent approach to defining
the relative worth of jobs within a work place, single plant or multiple size organizations.
It is a process whereby jobs are placed in a rank according to overall demands placed
upon the job holder. It therefore provides a basis for a fair and orderly grading structure.
A job evaluation system is composed of compensable factors and a weighting scheme
based on the importance of each compensable factor to the organization. A compensable
factor is a job characteristic that the organization values and chooses to pay for. These
characteristics include job characteristics may include job complexity, working
conditions, required education, required experience, and responsibility.
IMPORTANCE OF JOB EVALUATION





Job evaluation can be beneficial when the existing grading system/structure in an
organization is in need of review.
Job evaluation helps or maintains the credibility and acceptability of a grading
system.
Job evaluation facilitates the accommodation of new or revised jobs into the
grading structure.
Job evaluation can be used by organizations as a basis for job matching and
external pay comparisons.
It ensures the organization meets equal pay for work of equal value obligations.
METHODS OF JOB EVALUATION
The major methods of job evaluation include the following.
 Job ranking
 Job classification
 Factor comparison
 Point factor evaluations
 Proprietary brands
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Ranking
Ranking simply orders the job done in the organization from the smallest to largest based
on the evaluator’s perception of relative value or contribution to an organization’s
success. Jobs are compared with each other and arranged according to their perceived size
or value to the organization. The comparison may be based on a single factor such as the
level of responsibility.
Moreover, ranking method is suitable and only workable for small organizations, with
very few different jobs. The ranking is based on the whole job and the jobs are not broken
down into factors or elements. The method is simple and easy to implement, less costly to
the organization and requires little training.
Job classification or pay grades
Job descriptions are slotted into a series of classes that cover the range of jobs. Each class
has a description of the characteristics such as the skill, decision making and
responsibility that relate to jobs in that category. It is used a lot for public service jobs.
The class descriptions are the standards against which the jobs are compared.
Job classification is a very common job evaluation method which involves slotting jobs
into the pre-described grades. For each job grade, there is the minimum, midpoint and
maximum pay. As long as the grades exist, there is less difficult in setting the pay for
employees. The disadvantage with using grades is that some jobs will be underpaid while
others are overpaid.
Just like ranking, grading is simple to administer, cheap to the organization, and requires
little training. However, the grades are general and abstract, and compensable factors are
not clearly defined.
Factor Comparison
This is a very complex method of job evaluation. Nevertheless, it can perpetuate equity
because it takes into consideration what is happening in the market.
The factor comparison method involves comparing jobs against other jobs on the basis of
how much of some desired factor they possess. Each job’s factors are ranked against
each other job’s factors. Finally, the market pay rate for each job is then allocated among
the factors based upon a market pay rate scale.
Some of the factors considered include the level of responsibility, the risks involved in
the job, amount of decision making involved and the number of subordinates supervised.
Point- factor method
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This method involves breaking down jobs into factors or key elements representing the
demands made by the job on the job holders, the competences required, and the impact
made by the job.
The point factor method addresses three major aspects namely:
 defining the compensable elements
 Assigning a numerical scale of the factor degrees.
 Assigning weights to the factors which reflect the relative importance of each
factor.
Compensable elements are these characteristics in the job (not the position) that the
organization values and will help it to pursue its strategy and achieve its objectives. Some
of the compensable factors include job knowledge, problem solving abilities and
accountability.
Proprietary brands
These are job evaluation methods offered by management consultants. Perhaps, the most
common method here is the Hay Guide Chart which in essence is an administrative,
professional and technical job evaluation method.
Using the Hay System, jobs are evaluated as follows.
 Job description questionnaires are completed and signed by the jobholder, the
supervisor and other managerial staff who have responsibility for the position.
 The job description questionnaire is given to each member of the job evaluation
committee for his/her initial evaluation.
 The committee meets with the jobholders and supervisors to explore questions and
clarify content.
 The committee members then compare their individual evaluations and resolve
differences that might exist.
The hay system considers three major variables in job evaluation. These are know-how,
problem solving and accountability.
Know–how is the sum total of every kind of skill, however acquired, needed for
acceptable job performance. Know-how involves integrating and harmonizing the
diversified functions involved in managerial situations (operating, supporting and
administrative). This know-how may be exercised consultatively as well as executively
and involves in some combination the areas of organizing, planning, executing,
controlling and evaluating.
Problem solving is the original “self starting” thinking required by the job in analyzing,
evaluating, creating, reasoning, arriving at and making conclusions.
Accountability is the answerability for an action and for the consequences thereof; it is
the measured effect of the job on end results.
Conclusion
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Job evaluation will involve change even though the change may only affect some jobs.
Commitment to change will be essential, with both management and employee
representatives agreeing from the outset that they will act upon the results.
Job evaluation may result on some existing employee’s jobs being placed in a lower grade
which does not equate with other current pay-rate.
It is recommended that a policy on how to deal with such situations be considered and, if
possible, agreement reached before embarking on job evaluation.
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TOPIC TEN: COMPENSATION OF EMPLOYEES AND MANAGERS
Topic objectives
After studying this topic, the student should be able to:
 Define Compensation;
 Explain the Compensation policies;
 Discuss the various types of compensation;
 Discuss the bases for Compensation;
 Explain the characteristics of a good compensation system;
 Understand the factors to be considered when making pay level decisions.
INTRODUCTION
Employees exchange their inputs (physical and mental work behaviour) for outputs
(rewards). The employees use the rewards to satisfy their needs. Human beings have
many needs ranging from the most basic (i.e. physiological needs for food, water and
clothing), to safety, social, esteem, and self-actualisation needs. Employers can use
rewards to shape the behaviour of employees in the workplace. Wages can provide a
source of motivation for employees to perform effectively.
Money is probably the most important reward. The perplexing question to employers is
how much employees should be paid. The goals of compensation administration are to
design the lowest - cost pay structure that will attract, motivate, and retain competent
employees, and that also will be perceived as fair by employees. The compensation
should be fair to the organisation and to the employees.
DEFINITION OF REMUNERATION/ REWARD/ COMPENSATION
Remuneration may be defined as the financial and non financial extrinsic rewards
provided by an employer for the time, skills and effort made available by the employee in
fulfilling job requirements aimed at achieving organisational objectives.
COMPENSATION POLICIES
Firms should formulate compensation policies. Specific issues to be included in the
policy include the following:
 Pay level- the policy should state whether the pay level will be above, below, or the
same as the prevailing market rate.
 Equity-it should be stated how the organisation would strive to achieve equity in its
remuneration.
 Performance related rewards- this is the question of how achievement would be
rewarded and the role incentives and bonus schemes would play.
 Market rate policy-here one states the extent to which market rate pressures should
be allowed to affect or possibly distort the salary structure.
 Control- a policy statement in this regard answers the question of how much
freedom is given to individual managers to influence the salaries of their staff.
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





Communication- how much information about remuneration should be made freely
available to employees and their representatives and what degree of pay secrecy
should be enforced
The minimum level at which new employees should be engaged needs also to be
stated.
Pay differential/intervals within a job grade and between consecutive job grades
should be reflected.
The extent to which individuals/groups can negotiate their pay and allowances within
the established rates is also supposed to be covered.
The rate and intervals at which pay rises can be granted forms part of the policy.
The pay increases can be fixed or variable amounts and can be granted at a variable
interval or fixed intervals.
Flexibility of the pay structure due to environmental changes is also to be included.
TYPES OF COMPENSATION
There are 3 forms (types) of compensation namely:
1. Pay- this is the basic compensation that an employee receives, usually as a wage or
salary. Employees who are paid on hourly basis are said to receive wages. People who
are paid salaries receive payments that are consistent from time to time despite the
number of hours worked.
2. Incentives – This is the compensation that rewards employees for efforts beyond
normal performance expectations. It takes the form of bonuses, commissions, and
profit sharing plans among others.
3. Benefits - These are indirect rewards such as health insurance, vacation pay, or
retirement pensions, given to an employee or group of employees as a part of
organisational membership.
BASES FOR COMPENSATION
There are 3 bases namely:
1. Time - Employees may be paid for the amount of time they are on the job. The most
common means of payment based on time is hourly pay; employees who are paid hourly
are said to receive wages, which are payments directly calculated on the amount of time
worked. The people can also be paid a salary, which is consistent from period to period
despite the number of hours worked. Being salaried typically carries higher status, greater
loyalty and more organisational commitment than being paid wages.
2. Performance and Productivity - A direct productivity - based system, called piece-rate
system, is one in which an employee is paid for each unit of production. In a merit or payfor-performance systems, employee performance is used to make pay increase decisions.
3. Task or Skill-Based Pay - Nowadays, a growing number of organisations are paying
employees, particularly hourly ones, for the skills or competencies they have, rather than
for the specific tasks being performed. The pay can also consider the knowledge, skills
and behaviours possessed by the employees. Leadership, problem solving skills, decision
making abilities, and ability to participate in strategic planning are some of the behaviours
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compensated for. Paying for skills rewards employees who are more versatile and have
continued to develop their skills through continuous cross-functional training.
Usually an organisation ends up using a combination of approaches to compensation,
depending upon its culture, philosophy, life cycle, and financial constraints. Whatever
specific systems and programs are used, it is important that the impact of compensation
on behaviour of employees and managers be recognised.
CHARACTERISTICS OF A GOOD COMPENSATION SYSTEM
Factors that would make a good compensation package include the following:
1. It should attract, motivate and retain the right quality of staff
2. It should compete favourably within the job market and within the job sector of the
economy
3. It should be flexible to adapt to environmental changes e.g. income, inflation
4. It should be socially acceptable to the organisation's public; the shareholders,
customers, government, trade unions, civil rights bodies
5. It should be perceived as reasonable within the framework of impartiality and equity
(affirmative action)
FACTORS TO BE CONSIDERED WHEN MAKING PAY LEVEL DECISIONS
When making the pay level decisions, the following factors should be considered:1.
Minimum wages
Governments specify or set legislations in relation to the minimum wages that can be paid
to employees.
2.
Compensation levels in other organisations
Organisations can conduct their own wage and salary surveys in order to assess the pay
levels within a particular industry, segment of an industry, or local area. Theoretically
high quality labour (in terms skills, education, experience and other personal attributes of
the employees) is more likely to migrate to those organisations where the pay level is
higher, assuming that working conditions, location, and other personnel practices are
about the same.
3.
Union influences
Labour unions generally attempt to standardise wages among unionised firms in a
particular industry.
4.
Labour market and Economic conditions
Organisations raise wages and salaries when inflation is high, unemployment is low, or a
specific type of employee or occupational group is in short supply. Conversely, pay levels
rise much more slowly during periods of high unemployment when labour is abundant.
Organisations increase the pay level of their employees in order to attract employees with
scarce and high demand job skill e.g. chemical engineers. Increases in the cost of living
also have a substantial impact on pay levels. Periodic increases in wages and salaries are
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often tied directly to changes in the Consumer Price Index (CPI) and Cost-of-Living
Adjustments (COLA).
5.
Organisational ability to pay and strategy
In making pay level increases, firms need to look beyond the immediate profit picture and
forecast the financial condition of the company in the future. It is generally easier to avoid
large pay increases than it is to cut pay levels later because of financial hardships.
6. Motivation theories
Especially equity and expectancy theory. According to these theories employees compare
what they earn with what their counterparts earn in other organizations. The employees
will either be de-motivated or motivated based on the outcome of the comparison.
7.
The bargaining power of stakeholders such as individuals, unions,
governments, civic organisations, private consultants and so on should also be considered.
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TOPIC ELEVEN: PERFORMANCE APPRAISAL
Topic objectives
After studying this topic, the student should be able to:
 Define Performance Appraisal;
 Understand the benefits of Performance Appraisal;
 Explain the reasons for conducting Performance Appraisal;
 Distinguish the various methods of conducting Performance Appraisal;
 Understand the challenges of Performance Appraisal.
INTRODUCTION
Performance appraisals are part of the broader field of performance management. It is
therefore necessary to understand performance management in order to fully understand
performance appraisal
Performance management can be defined as a strategic and integrated approach to
delivering sustained success to organisations by improving the performance of the people
who work in them and by developing the capabilities of teams and individual contributors
(Armstrong and Baron, 1998).
The purpose of Performance management is to get better results from the organisation,
teams and individuals by understanding and managing performance within an agreed
framework of planned goals, standards and competence requirements. It is a process for
establishing shared understanding about what is to be achieved, and an approach to
managing and developing people in a way that increases the probability that the goals of
the organisation will be achieved in the short run and also in the long run.
DEFINITION OF PERFORMANCE APPRAISAL (PA)
Performance Appraisal (PA) has been defined variously by different authors. Glüeck
(1978) defines PA as a personal activity by means of which the enterprise determines the
extent to which the employee is performing his/her job effectively.
Jeffrey Gold (2003) defines PA as a process that provides an analysis of a person’s
overall capabilities and potential allowing informed decisions to be made for particular
purposes.
Graham (1999) defines PA as “the judgement of an employee’s performance in a job,
based on considerations other than productivity alone. It is sometimes called merit rating,
especially when it is to discriminate between employees in granting increases in wages or
salaries”.
Fisher (1996) says PA is the process by which an employee’s contribution to the
organisation during a specified time is assessed. It lets the employees know how well they
have performed in relation to the standards of the organisation.
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Performance appraisal refers to the systematic description of the job-related strengths and
weaknesses of an individual or group (Gerald R. 2002: 19-20).
It has also been defined as the systematic evaluation of the individual with respect to his
performance on the job and his potential for development (Beach, 1975).
BENEFITS OF PERFORMANCE APPRAISALS
a. Performance evaluations assist decision-makers to determine who should receive pay
increases, transfers, promotions, demotions or retrenchment. Often, promotions are a
reward for past performance. Many firms actually grant part or all of their pay increases
and bonuses based upon merit, which is determined mostly through Performance
Appraisal
b. The performance feedback allows the employee, manager, and personnel specialists to
intervene with appropriate actions to improve performance. Poor performance may
indicate the need for retraining while good performance may indicate untapped potential
that should be developed
c. The performance feedback also guides career decisions about specific career paths that
one should investigate
d. Performance appraisal assists the personnel department in evaluating its activities. Good
or bad performance implies strengths or weaknesses in the personnel department’s
staffing procedures. Similarly poor performance may indicate errors in job analysis
information, Human Resource plans, or other parts of the Personnel Management's
information system. Reliance on inaccurate information may have led to inappropriate
hiring, training or counselling decisions. Appraisals help diagnose errors in job designs
e. Sometimes performance is influenced by factors outside the work environment. These
factors may include the family, financial, health or other personal matters. If uncovered
through appraisals the personnel department may be able to provide assistance.
f. Performance Appraisal provides the basis for validation of prediction used in internal and
external selection as well as placement.
g. Performance Appraisal may be used to weed out marginal or low performing managers
and to serve as a basis for modifying behaviour toward more effective performance.
THE METHODS OF PERFORMANCE APPRAISAL
1. ESSAY APPRAISAL
In its simplest form, this technique asks the rater to write a paragraph or more covering an
individual's strengths, weaknesses, potential, and so on. In most selection situations,
particularly those involving professional, sales, or managerial positions, essay appraisals
from former employers, teachers, or associates carry significant weight. The assumption
seems to be that an honest and informed statement -either by word of mouth or in writingfrom someone who knows a person well, is fully as valid as more formal and more
complicated methods.
The biggest drawback to essay appraisals is their variability in length and content.
Moreover, since different essays touch on different aspects of a man's performance or
personal qualifications, essay ratings are difficult to combine or compare. For
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comparability, some type of more formal method, like the graphic rating scale, is
desirable.
The essay method reduces supervisory bias, halo effect, central tendency and leniency
problems. However, the supervisor may spend formidable time writing separate essays
about each employee. Further essays are not very useful for evaluative purposes as no
common standard exists. Another drawback is the appraiser’s ability to write. A good
writer will earn the appraisee more marks while a poor writer who may be appraising a
good worker may make the employee to earn low marks due the inability to write.
2.
RATING SCALES
Rating scales are satisfactory for most evaluation purposes because they provide a
mathematical evaluation of the employees' performance, which can be used to justify
compensation or job changes and to validate selection instruments.
a. The Graphic Rating Scale
This involves using a scale to measure or gauge an employee’s relation to a certain
attribute such as using initiative, punctuality, reliability, ability to meet targets. Questions
are formulated and each question would then have a numerical scale alongside it, similar
to the one below:
Never
(0%)
Rarely/ Seldom Half the Time/ Usually
(25%)
Sometimes
(75%)
(50%)
Always
(100%)
For operative staff, typical qualities rated are:
 Quality and quantity of work
 Job knowledge
 Cooperativeness
 Dependability
 Initiative
 Industriousness
 Attitude
For management personnel, typical factors are analytical ability, decisiveness, creative
ability, leadership, initiative, job performance, co-ordination, and emotional stability.
The assessor gives the employee a score which most closely approximates his degree in
relation to the question(s) and a total score is arrived at by adding together all of the
individual item scores on the appraisal form. Although this method is quick and requires
little training, it is prone to rater errors.
This technique may not yield the depth of an essay appraisal, but it is more consistent and
reliable. Typically, a graphic scale assesses a person on the quality and quantity of his/her
work (is he outstanding, above average, average, or unsatisfactory?) and on a variety of
other factors that vary with the job but usually include personal traits like reliability and
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cooperation. It may also include specific performance items like oral and written
communication.
The graphic scale has come under frequent attack, but remains the most widely used
rating method. It is cheaper to develop and more acceptable to raters than the forcedchoice form. For many purposes there is no need to use anything more complicated than a
graphic scale supplemented by a few essay questions.
b. Non-Graphic Rating Scales
Non-graphic scales may be used when an explanation may need to be given to justify the
point raised, e.g. with regard to punctuality
Never
(0%)
Rarely/ Seldom Half the Time/ Usually
(25%)
Sometimes
(75%)
(50%)
Always
(100%)
Comment
on
your
response
with
regard
to
punctuality
______________________________________________________________
______________________________________________________________
Non-graphic scales are more valid than graphic rating scales as they contain a brief
description of each point on the scale rather than simply high and low points of a scale.
The rater can give a more accurate description of the employee’s behaviour on a
particular attribute because a description clarifies each level of the rating scale. It is a
quick and less difficult method for supervisors to use.
c. Bars or Behaviorally Anchored Rating Scales
This method is designed to assess behaviour required to successfully perform a job. The
assumption is that personal behaviour will result in required performance. Most bars use
the term job dimension to mean those broad categories of behaviour that make up a job.
Each job will have several bars. Bars are developed through the active participation of
both managers and job holders therefore increasing the likelihood of the method being
accepted. However, it takes time and commitment to develop different bars for different
jobs.
3. FIELD REVIEW
When there is reason to suspect rater bias, or when some raters appear to be using higher
standards than others, or when comparability of ratings is essential, essay or graphic
ratings are often combined with a systematic review process. The field review is one of
several techniques for doing this. A member of the personnel or central administrative
staff meets with small groups of raters from each supervisory unit and goes over each
employee's rating with them to (a) identify areas of inter-rater disagreement, (b) help the
group arrive at a consensus, and (c) determine that each rater conceives the standards
similarly.
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This group-judgment technique tends to be fairer and more valid than individual ratings
and permits the central staff to develop an awareness of the varying degrees of leniency
or severity -as well as bias- exhibited by raters in different departments. On the negative
side, the process is very time consuming.
4.
COMPARATIVE METHODS
They avoid the problem of central tendency or crowding employees in some groups. They
include:
a. RANKING (INDIVIDUALS)
Employees are ranked on a certain attribute e.g. leadership skills, or on their sales
performance. It involves rating individuals by arranging them according to merit, from
the best to the poorest in terms of a specific characteristic or of overall performance. No
ties or balanced scores are allowed.
Advantages
1. It is fast and easy to complete where few employees exist
2. A numerical evaluation given to the employees can be directly related to and used to
make other decisions such as compensation changes or staffing considerations
Disadvantages
1. It is not developmental because employees do not receive feedback about their
performance with regard to strengths, weaknesses or future direction
2. It assumes all employees in the organisation can be ranked from the best to the worst
3. There is no common standard of performance by which to compare employees from
various departments
For comparative purposes, particularly when it is necessary to compare people who work
for different supervisors, individual statements, ratings, or appraisal forms are not
particularly useful. Instead, it is necessary to recognize that comparisons involve an
overall subjective judgment to which a host of additional facts and impressions must
somehow be added. There is no single form or way to do this.
Comparing people in different units for the purpose of, say, choosing a service supervisor
or determining the relative size of salary increases for different supervisors, requires
subjective judgment, not statistics. The best approach appears to be a ranking technique
involving pooled judgment. The two most effective methods are alternation ranking and
paired comparison ranking.
Alternation ranking: In this method, the names of employees are listed on the left-hand
side of a sheet of paper - preferably in random order. If the rankings are for salary
purposes, a supervisor is asked to choose the "most valuable" employee on the list, cross
his/her name off, and put it at the top of the column on the right-hand side of the sheet.
Next, he/she selects the "least valuable" employee on the list, crosses his/her name off,
and puts it at the bottom of the right-hand column. The ranker then selects the "most
valuable" person from the remaining list, crosses his/her name off and enters it below the
top name on the right-hand list, and so on.
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Paired-comparison ranking:
Raters here pair employees and choose one as superior in overall job performance. The
employee is given a positive comparison total and a certain percentage of the total
positive evaluation as follows:
The No. of comparisons will be
=
N (N-1)
2
(where N = population)
While the method is quick and easy where few (2 at a time) employees are being rated, it
is time consuming where many employees are being rated. Moreover, employees are
compared to each other on overall performance rather than on specific job criteria.
Both ranking techniques, particularly when combined with multiple rankings (i.e., when
two or more people are asked to make independent rankings of the same work group and
their lists are averaged), are among the best available for generating valid order-of-merit
rankings for salary administration purposes.
FORCED DISTRIBUTION
The supervisor is forced to distribute the employees to pre-determined groups like 10%
should be excellent, 20% good, 40% average, 20% below average and 10% very poor.
Like the field review, this technique was developed to reduce bias and establish objective
standards of comparison between individuals, but it does not involve the intervention of a
third party. Although there are many variations of this method, the most common one
asks raters to choose from among groups of statements those which best fit the individual
being rated and those which least fit him/her. People with high scores are, by definition,
the better employees; those with low scores are the poorer ones. Since the rater does not
know what the scoring weights for each statement are, s/he cannot play favorites. He
simply describes his people, and someone in the personnel department applies the scoring
weights to determine who gets the best rating.
The rationale behind this technique is difficult to fault. In practice, however, the forcedchoice method tends to irritate raters, who feel they are not being trusted.
An additional drawback is the difficulty and cost of developing forms. Consequently, the
technique is usually limited to middle and lower management levels where the jobs are
sufficiently similar to make standard or common forms feasible.
Finally, forced-choice forms tend to be of little value- and probably have a negative
effect- when used in performance appraisal interviews.
The practice of forced distribution is that job performance is the basic factor in
determining an employee’s value to an organisation and that other elements like cooperation and personality are worth considering only in so far as they contribute to
performance.
THE CRITICAL INCIDENTS METHOD
Supervisors first collect critical incidents that reflect especially favourable job
performance (such as completing a major assignment a head of schedule) and then they
scale the incidents. Lastly they construct the checklist scale.
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Scaling incidents involves presenting the incidents to a group of people who are familiar
with the job in question who then assign scale values to each incident according to its
assessed desirability.
The checklist scale is drawn up containing only those items judged to indicate 'good' or
'poor' performance on the job. Workers are rated according to whether or not they have
shown any of the incidents/behaviours listed and a total score calculated.
Advantages:
1. The method does not involve complicated statistical procedures. It is concerned with
actual on the job behaviours, which have been observed in particular organisational
circumstances
2. Supervisors are only required to indicate whether or not workers have or have not
been observed to behave in a particular way as opposed to being forced to make
judgements/rankings of the personal characteristics of their subordinates.
Here the evaluator uses the most memorable incidences associated with the employee
whether they happened recently or sometimes ago. For instance: always reporting to work
in time, finishing a major assignment ahead of time etc.
There are, however, several drawbacks to this approach. It requires that supervisors jot
down incidents on a daily or, at the very least, a weekly basis. This can become a chore.
Furthermore, the critical incident rating technique need not, but may, cause a supervisor
to delay feedback to employees.
Finally, the supervisor sets the standards. If they seem unfair to a subordinate, might he
not be more motivated if he at least has some say in setting, or at least agreeing to, the
standards against which s/he is judged.
MANAGEMENT BY OBJECTIVES (MBO)
Management by Objectives (MBO) is a developmental approach to performance
appraisal. Developmental approaches offer specific, goal oriented, jobs related guidelines
and behaviour for performance improvement.
MBO Involves the Following Steps






Performance planning: The employee and supervisor mutually establish a list of
goals designed to accomplish the needs of the business, further develop the
employee and broaden his/her basic responsibilities. The objective should be
quantifiable and measurable, challenging yet achievable, expressed in writing and
in clear, concise and unambiguous language, and the employees should participate
in the setting them. The objectives and action plans must serve as a basis for
regular discussions between the manager and the employee.
Developing an action plan indicating how these objectives are to be achieved
Allowing the employee to implement the action plan
Review: Periodically the supervisor and employee should conduct a formal
appraisal interview to review the employee’s actual performance against
objectives
Taking corrective action whenever necessary
Personal development plan (PDP). It is prepared jointly by an employee and
supervisor for the purpose of improving proficiency and preparing for additional
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responsibility. Personal development plans include methods of overcoming
deficiencies and building on strengths through specific training measures during a
particular time period.
 Establishing objectives for the future
MBO is both advantageous and disadvantageous. For instance while it focuses on
performance results rather than personal characteristics, the time and effort required
implementing it is extensive. High standards set may be difficult and unrealistic to
achieve. Objectives for new jobs are difficult to set.
WORK-STANDARDS APPROACH
The work-standards approach is set by the managers. This is used mostly for production
workers and is a form of goal setting for the employees. It involves setting a standard or
expected level of output and then comparing each employee’s performance to the
standards. The work standards should reflect average output of a typical employee.
Standards technique establishes work and staffing targets aimed at improving
productivity. When realistically used, it can make possible an objective and accurate
appraisal of the work of employees and supervisors.
To be effective, the standards must be visible and fair. Hence a good deal of time is spent
observing employees on the job, simplifying and improving the job where possible, and
attempting to arrive at realistic output standards.
Methods used to set standards include:
 Average production of work groups
 Performance of specially selected employees
 Time study
 Work sampling
 Expert opinion
The advantage of this method is that the review is based on timely objective factors.
The most serious drawback appears to be the problem of comparability. If people are
evaluated on different standards, how can the ratings be brought together for comparison
purposes when decisions have to be made on promotions or on salary increases? For these
purposes some form of ranking is necessary.
360 DEGREE APPRAISALS
360 degree appraisals involve the appraisee receiving feedback from people (named or
anonymous) whose views are considered helpful and relevant. The feedback is typically
provided on a form showing job skills/abilities/attitudinal/behavioural criteria and some
sort of scoring or value judgement system. The appraisee should also assess themselves
using the same feedback instrument or form.
360 degree respondents can be the appraisee's peers, up-line managers/execs, subordinate
staff, team members, other staff, customers, suppliers - anyone who comes into contact
with the appraisee and has opinions/views/reactions of and to the appraisee.
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THE CHECKLIST METHOD
A checklist for completion by job holders is similar to a questionnaire but response
requires fewer subjective judgements and tends to be the YES and NO variety. Checklists
cover as many as 100 activities; job holders tick those tasks that are included in their jobs.
The advantages of this method are that it is flexible, can provide in-depth information and
is easy to organize and prepare.
The disadvantage is that it can be time consuming and the results are not easy to analyze.
CHALLENGES OF PERFORMANCE APPRAISAL
1. LEGAL CONSTRAINTS
Performance Appraisals must be free from discrimination and should not violate laws
such as the Equal Employment Opportunity or any laws such as wrongful dismissal
(discharge), lay offs, demotions or failure to promote. An appraisal system should be fair
to all irrespective of race, sex, national origin, disability, minorities, age, etc.
2. RATER BIASES
a. The Halo Error – this takes place when the rater allows one aspect of a person’s
character or performance to influence the entire evaluation. It is expected that one
cannot be very good or very poor in all aspects. This error can be minimized by
educating the raters to make them aware of the problem. The supervisors can also be
asked to judge all the subordinates on a single factor or trait before going on to the
next factor.
b. The Error of Central Tendency – this refers to the reluctance to give extreme
ratings (either very poor or excellent). Instead the rater marks each employee near the
centre of the rating sheet, showing an inability to distinguish between or among them
(a form of range restriction). For instance, on a rating scale of 1-5, a rater may rate all
employees as 3 – distorting the score to make each employee appear average.
c. The Leniency and Strictness Bias
i.
The Leniency Bias results when evaluators tend to be positively lenient in
their appraisal of an individual, causing the performance of employees to be
overstated and rated higher than they should be.
ii.
Similarly, the Strictness Bias is just the opposite – it results from raters being
too harsh in their evaluations, sometimes to be seen as tough judges. This
tendency underrates performance, giving the individual a lower appraisal
standard than they deserve.
If all individuals in an organisation were appraised by the same person, there would
be no problem. Difficulty arises when we have different evaluators, some lenient and
others strict, making judgements on the same set of employees.
d. Cross-cultural Biases
When people are expected to evaluate others from different cultures, they may apply
their cultural expectations to someone who has a different set of beliefs e.g. Arabic
culture expects women to play a very subservient role especially in public. Similarly,
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Eastern cultures award more respect and esteem to the elderly compared to western
cultures.
e. Personal Prejudice
A rater's dislike for a group or class of people may distort the ratings those people
receive e.g. male supervisors often give undeservedly low ratings to women who hold
traditionally male jobs. Such prejudice prevents effective evaluations and may even
violate anti-discrimination laws.
f. Similarity Error (“similar-to-me” mistake).
Occurs when evaluators rate other people in the same way that the evaluators perceive
themselves, e.g. the evaluator who perceives himself as aggressive may evaluate
others looking for aggressiveness. Those who demonstrate this characteristic tend to
benefit, while others who may lack it may be penalised.
g. The Recency Effect
Subjective performance ratings are affected strongly by the employee’s most recent
actions - either good or bad - as they are more likely to be remembered by the
evaluator.
Where subjective performance measures must be used, biases can be reduced through
training, feedback, and the proper selection of PA techniques.
3. LOW APPRAISER MOTIVATION
If an evaluator knows that a poor appraisal could significantly hurt the employees future
(e.g. opportunities for promotion, salary increases, etc) the evaluator may be reluctant to
give a realistic appraisal.
4. APPRAISAL ACCEPTANCE
The employees may not accept the appraisal result and evaluators may have difficulties
“selling” the results to the ratees.
5. LACK OF ORGANISATIONAL SUPPORT
This happens when the organisation does not act on feedback received from the
evaluation.
CONCLUSION
None of these methods is mutually exclusive. All of these performance assessment
methods can be used in conjunction with others in the list, depending on situation and
organizational policy. Where any of these processes is used, the manager must keep a
written record, and must ensure agreed actions are followed up. To achieve the best
results, employees will be motivated by providing feedback on how they are doing.
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TOPIC TWELVE: DESPATCH OR SEPERATION OF EMPLOYEES
Topic objectives
After studying this topic, the student should be able to:
 Understand the concept of employee separation;
 Distinguish the various types of employee separation.
INTRODUCTION
Despite all efforts to maintain employees in an organisation, the employment relationship
between individuals and the employing organisation will inevitably break down from
time to time. In some cases, the employees terminate the relationship by resigning in
order to take up positions elsewhere. The management of an organisation may also
terminate the contract.
Employee separation occurs when an employee ceases to be a member of an organization.
Managers must develop skills for helping employees who leave the organization either
voluntarily or involuntarily. A poor separation can damage a firm’s reputation in its
industry or community and limit its ability to attract the scarce, talented employees that it
may need in the future. In some cases, the retention of employees may be directly related
to the retention of major customers and investors. This occurs where the employees have
contacts with the customers or where the investors have confidence in the particular
employees. Service industries may be more affected because in such industries it is the
employees who provide the services. The customers may have learned to trust certain
employees.
The reasons that make employees to separate from organisations range from retirement to
layoffs, downsizing, retrenchment, resignations, discharge, dismissal and death.
Employees who enter an organisation will at one time leave that organisation hence there
is always a movement of employees into and out of every organisation. This movement
is referred to as labour turnover. Managers need to recognise that a high turnover can be a
very costly experience to an organisation. Turnover costs include recruitment costs,
selection costs, training costs, accident costs, loss of production costs, overtime costs and
replacement costs. Consider the case for replacement of pilots or information technology
specialists especially when they are in short supply.
While separation has many costs, it also has many benefits. Some of the benefits include
the following:
 When turnover rates are too low, few employees will be hired and opportunities
for promotion are reduced.
 Low turnover may affect productivity negatively especially where the workforce
is complacent and does not generate innovative ideas. Thus separation enables
poor performers to be replaced, innovation is increased, and opportunities for
greater diversity are enhanced.
 Separations enable an organization to reduce its labour costs. The firm may be
incurring unnecessary expenses on marginal performers.
 It can open new frontiers for the departing employee.
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TYPES OF EMPLOYEE SEPERATION
Separations can be either voluntary or involuntary. Involuntary separation occurs when
the turnover is initiated by the organization especially among employees who would
prefer to stay while voluntary separation is initiated by the employees whom the
organization would prefer to keep.
VOLUNTARY
1.
QUITS (JOB WITHDRAWALS)
An employee may withdraw from a job because they are dissatisfied with the job or the
job environment. Some of the issues which lead to dissatisfactions include perceived or
real poor pay and benefits, difficulties with supervisors and co-workers, inability to
reconcile with the tasks and roles and other personal predisposition issues such as joining
a spouse who is elsewhere or the desire to perform other family obligations. Other
reasons include poor health, poor working conditions and poor management.
Employees who are dissatisfied may seek to change the undesired behaviour but where
they cannot do so, they may opt to quit the job. In situations where the employees cannot
change their situation or remove themselves from their jobs, they may psychologically
disengage themselves from the jobs. This can be done by showing less commitment to the
job or to the organization and identifying less with both items.
Sometimes, employers encourage employees to quit by using pay incentives such as
severance pay or buyouts. An example is the use of “golden handshakes”. This method
of separation should be avoided at all cost since they not only place a heavy financial
burden on an organization but they may be a manifestation of poor worker management
2.
EARLY RETIREMENT (VOLUNTARY RETIREMENTS)
Early retirement is initiated by the employee. It occurs at the end of a certain period and
results in the employee getting certain benefits. The organization must plan for the early
retirement of employees.
In all organisations there must be stipulated retirement regulations, including mandatory
and voluntary retirement schedules. Since retirement is a major stage in one’s life
progression, an organisation has an important role to play in the facilitation of this
transition.
In determining retirement regulations, it is important for managers to consider the pros
and cons of both mandatory and voluntary retirement.
Mandatory retirement may be advantageous because it is simple to administer; it creates
opportunities for younger employees to exploit their potential; it aids human resource
forecasts and plans; it enables employee to plan for their exit in advance and that it
reduces inequities in decision making in regard to separation. However, mandatory
retirement does not recognize the fact that employees depreciate at different rates and that
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crucial talent may be lost due to a rigid regulation. It is also likely that a mandatory
retirement age may be lost due to a rigid regulation. It is also likely that a mandatory
retirement age may induce some workers to “retire” while they still holding on to the jobs
during their twilight years!
Some sociologists have come up with several phases through which employees may
experience the retirement process. These phases are:

Remote phase. This begins many years before the actual retirement date. Awareness
of an impending retirement is important so that provision can be made for financial
and social security;

Near phase. Provides the reality of an imminent retirement. An employee begins to
see and be seen in short term. The engagement of employees in major organizational
activities begins to wane. Retirement ceremonies and long service awards are held at
this stage.

Honeymoon phase. This is the stage where retirees experience unlimited freedom
away from employment. The retirees engage themselves in a number of social
activities such as visit, travel, games and picnics. It is a spending spree;

Disenchantment phase. This is the stage when the honeymoon is over. Those retirees
who did not plan for retirement will find it difficult fitting into new communities and
changed roles in the society. They, therefore, feel bored and disenchanted after the
honeymoon;

Reorientation phase. At this stage the retirees reorient themselves into new lifestyles.
Counselling programmes are useful here in providing the retirees with the muchneeded assistance programmes. This is the time to face realities and develop
appropriate interests and capabilities necessary for survival;

Stability phase. This is the stage when the retirement programmes and lifestyles have
been fully developed. A retiree can lead a predictable and satisfying lifestyle because
he or she has now acquired a gainful position in society;

Termination phase. This is when the retiree is no longer self-sufficient because he or
she has exhausted both the financial and physical resources. This is the stage when
the retiree ceases to be retired and becomes dependent upon family, relatives, friends
or home for the aged. It marks the end of retirement.
INVOLUNTARY SEPERATIONS
These are initiated by the employer on those employees that are considered undesirable
either due to failing to meet performance expectations are the inability to comply to the
employer’s policies.
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The main types of involuntary separations are discharges and lay offs.
1.
DISCHARGES
Discharges are instituted on those employees that are unable to meet performance
requirements or those who violate company policies on the job. Failure to change some
unacceptable behaviour is a very good ground for dismissal. Employees who engage in
serious misconduct, such as theft or dishonesty, may also be discharged. Other reasons for
summary dismissal include absenting oneself from the place of work without a just cause,
inability to perform jobs because of drunkenness, use of abusive language, being arrested
for an offence that can lead to imprisonment, and committing an offence to the detriment
of the employer.
Discharges, also known as dismissals, can be defined as any one of the following:
 An employer has terminated a contract of employment with or without notice;
 An employee reasonably expected an employer to renew a fixed term contract of
employment on the same or similar terms, but the employer offered to renew it on less
favourable terms, or did not renew it;
 An employer refused to allow an employee to assume work after she took maternity
leave in terms of any law, collective agreement or her contract of employment;
 An employer who dismissed a number of employees for the same or similar reasons
has offered to re-employ one or more, but has refused to re-employ another;
 An employee terminated a contract of employment with or without notice because the
employer made continued employment intolerable for the employee.
Discharging employees can be a very difficult task that needs to be handled with a lot of
care and attention to the affected employees. Where the exercise is poorly conducted, it
can lead to long court battles in which employers can be fined huge sums of money. In
situations where the discharged employee wins the court case and the employer is forced
to accept the person back, uncomfortable relations can arise with some employees being
violent to the employer. Thus an organization should have a standardized systematic
approach to discipline and discharge.
Dismissal can have serious impacts on the affected persons. They can experience trauma
arising from shattered egos. Moreover, discharges can bring financial, social and family
problems. And those who “survive” in the organization may also experience the trauma
and reduced motivation as a result of losing a colleague or a dear friend. Some
organizations rank their employees from the best to the worst in terms of a performance
variable such as the amount of sales made. Consequently, some of the employees at the
bottom are then discharged. Those who remain know that the next performance appraisal
exercise may affect them negatively.
Employers should be entitled to and given the opportunity to make the appropriate
justification for terminations and, having followed fair procedure, to dismiss employees.
However, all dismissals should be done fairly.
Established disciplinary procedures must be exhausted before an employee is discharged.
In the first instance the employee should be given an unofficial verbal warning with a
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witness present. The second offence warrants an official written warning. The third
offence is responded to with a second official warning with a threat of temporary
suspension. Where the employee repeats the offence a fourth time, s/he is temporarily
suspended and given a last chance notification. It is only when the employee repeats the
offence that s/he is terminated but with a right to seek arbitration.
Employees should be given the opportunity to change those behaviours that are deemed
to be undesirable. After all, who knows, they could change and become good performers.
2.
REDUNDANCY
Redundancy has been variously referred to as layoffs, downsizing, rightsizing, reductionin-force, or retrenchment. It occurs where some change forces the firm to reduce its
workforce. The changes include increased global competition, reductions in product
demand, changing technologies that reduce the need for workers, and mergers and
acquisitions. Dealing with redundancy is a painful exercise for human resources
managers. This is because it involves an abrupt loss of earning, separation from
colleagues, loss of personality and many uncertainties (Okumbe, 2001).
Due to the many negative effects of redundancies, it should be done systematically. The
following steps provide a good guidance on the process.
The organization must engage in proper human resource planning to avoid ending up in a
situation where some employees are declared redundant.
Employees who are likely to be declared redundant should be warned in advance and
encouraged to resign voluntarily through the use of monetary incentives. The organization
should use contingency measures such as terminating part-time services, eliminating
over-time, removing out-sourced contracts, job sharing, and applying temporary layoffs.
Affected employees should be assisted to get jobs elsewhere as soon as possible.
In situations where the redundancy exercise must be carried out, then it should be done as
fairly as possible.
3. DEATH (NATURAL ATTRITION)
Sometimes employees die while they are still in active employment organizations should
put mechanisms in place that ensure that employees don’t die from work related injuries
while they are still in active employment. The death of an employee needs to be handled
with care and concern so that those who remain perceive the organization even better and
continue to maintain their commitment to it.
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