Unit 4: Managing
people and change
Area of Study 1 – The Human Resource Management
Function
Chapter 4 Review
• Human resources are the employees of an organisation (the
workers).
• HR Managers are responsible for workplace tasks that relate
to the employment, retention and termination of employees.
• Employees are the most important resource in an
organisation.
• Therefore, they should be looked after so that the
organisation’s objectives can be achieved
The role of HRM
• The role of HRM is to ensure that employees are satisfied with
their jobs. They are then more likely to work productively,
helping managers to achieve organisational objectives.
HRM and performance
indicators
Key performance indicator
HRM strategies linked to business
objectives
Profit
HR managers need to ensure wages
are appropriate (not too high)
Training can be costly, but may provide
benefits.
Staff satisfaction, shown by staff
turnover rate
The recruitment process is costly, so
retaining staff who have the required
skills and knowledge is essential.
Work/life balance strategies could
assist in attracting and retaining
valuable staff.
Efficiency leading to increased
productivity
If workers have been properly trained,
their efficiency levels should increase.
Competitiveness
If workers are motivated they will work
hard, leading to a more competitive
organisation. LSOs that have
Employee expectations
• Human resource managers need to recognise differences in
employee expectations as this is linked to motivation and
satisfaction, and therefore overall performance and
productivity.
• HR Managers must adjust their practices to meet the needs
and expectations of employees.
• Employee expectations include: conditions of employment
(leave & remuneration), OHS, Job security, work/life balance
Ethics and social responsibility
• Ethics relate to the way business is conducted
• Socially responsible management is the way in which LSOs
give something back to the community in which they operate
• Ethics and socially responsible management must relate to HR
in some way – i.e. they must relate to the employment cycle,
motivation, employee relations or employee expectations
regarding conditions of work
Ethics in HRM
• Includes practices within the organisation as well as legislation
such as the Equal Opportunity Act 1995.
• In workplace terms, equal opportunity is closely related to
managing diversity – acknowledging the differences between
workings and making the most of them.
• There are also laws that regulate workplace bullying and
harassment – making employers vicariously liable if they have
not taken reasonable steps to prevent discrimination and
harassment.
Social responsibility in HRM
• The key area of HRM that reflects social responsibility is an
organisation’s leave policies.
• Some companies such as Telstra and ANZ allow its employees
to take leave and undertake voluntary work.
• This is also good for the organisation as employees appreciate
the opportunity to contribute to their community and this can
enhance motivation, leading to increased productivity and
company profits.
• There is also a positive benefit for the community.
Theories of motivation
• Understanding employees’ motivation and being able to
implement strategies to increase motivation leads improved
staff retention, productivity and overall profits.
• Maslow’s hierarchy of needs theory suggests that people will
progress from the most basic needs to the higher levels once
each need is satisfied. HRM needs to recognise all levels and
ensure that the organisation provides for these needs through
its HR strategies.
• Each employee will be at different stages so a range of
strategies may need to be implemented.
Herzberg’s two-factor theory
• This theory suggests that there are two sets of factors that explain
employee motivation.
• The hygiene factors (such as salary and benefits, relationships with
colleagues, physical working conditions and work security) can cause
dissatisfaction if they are not present or are low. If they are present or
high, then there is no dissatisfaction with the job. Improving hygiene
factors will only decrease job dissatisfaction but will not increase job
satisfaction.
• The motivator factors (which relate to employees’ sense of
achievement, recognition, responsibility, promotion, growth and the
work itself) may increase satisfaction in the job if they are present. If
they are not present then it will result in no satisfaction in the job.
Motivator factors are a source of job satisfaction. Only the motivator
factors are motivational in the long-term.
• The presence or absence of these factors is the key to employee
satisfaction, motivation and performance. Making people’s jobs more
interesting and varied can be one strategy for increasing motivation.
Other things include focusing on achievement, recognition and
responsibility.
Locke’s goal-setting theory
• Locke argued that specific and challenging goals led to better
task performance than vague or easy goals.
• When employees have clear and properly set goals they are
more likely to be motivated to achieve them.
• Providing feedback or communication about whether results
have been achieved motivates employees to achieve more
and encourages them to set higher goals for themselves.
• Setting goals should take into account the ability level of the
employee. HRM should have sound knowledge of employees,
their skills, knowledge and characteristics.
• Setting goals is a two-way process between manager and
employee. Employees are more likely to then accept and
commit themselves to achieving those goals.