Chapter
11
Managing
Human
Resource
Systems
Management
4th Edition
Chuck Williams
Chapter 11
Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Prepared by
Deborah Baker
Texas Christian University
1
What Would You Do?
Domino’s Pizza Headquarters, Detroit, Michigan.
 Domino’s annual turnover is 158
percent, making consistency
difficult
 Unhappy customers may not do
business again—and that hurts
profits
 It costs $2,500 to replace each
hourly worker, and $20,000 to
replace a store manager
How do you find qualified applicants?
What do you do to encourage managers to stay?
What would you do?
Chapter 11
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2
The Human Resource
Management Process
Determining Human
Resource Needs
Attracting Qualified
Employees
Developing Qualified
Employees
Human Resource
Planning
Recruiting
Selection
Training
Performance Appraisal
Keeping Qualified
Employees
Chapter 11
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Compensation
Employee Separation
Adapted From Exhibit 11.1
3
Determining Human Resource Needs
After reading these sections,
you should be able to:
1.
describe the basic steps involved in human
resource planning.
2.
explain how different employment laws affect
human resource practice.
Chapter 11
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4
Human Resource Planning
Supply and Demand
of
Human Resources
Human Resource
Information
Systems
1
Chapter 11
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5
Forecasting Demand and Supply
Work Force
Forecasting
Forecasting
Methods
•Direct managerial input
•Internal forecasts
•Best guess
•External forecasts
•Statistical / historical
ratios
1.1
Chapter 11
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6
Forecasting Demand and Supply
Internal
Factors
Work
Force
Forecast
External
Factors
1.1
Chapter 11
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7
Internal Forecast Factors

New positions

Transfers

New equipment and
technology

Deaths

Promotions

Eliminated positions

Organization’s mission

Terminations


Retirements
Productivity of current
employees

Resignations


Turnover
Skills/education of
current employees
1.1
Chapter 11
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Adapted from Exhibit 11.2
8
External Forecast Factors




Demographics of labor 
supply

Geographic population 
shifts
Unemployment rate
Manufacturing-to
service-to informationbased economy shift

Technological
advances

Competitors
Economic conditions

Growth of businesses
Labor unions
Availability of
applicants
1.1
Chapter 11
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Adapted from Exhibit 11.2
9
Forecast Methods
Direct
Managerial
Input
Based on projections of cash flows,
expenses, or financial measures
Best
Guess
Based on managers’ assessment of
current head count, plus a guess on
relevant internal/external factors
Statistical/
Historical Ratios
Based on statistical methods, such as
multiple regression, in combination
with historical data
1.1
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10
Human Resource Information Systems

Computerized employee information systems
 Uses
• transaction processing
• employee self-service
• decision support
1.2
Chapter 11
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11
Human Resource Information Systems
1.2
Personal Data
Promotion Data
Work History
Educational
Data
HRIS
Performance
Appraisal
Chapter 11
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Company
Employment
History
Adapted from Exhibit 11.3
12
Employment Legislation
Federal
Employment
Laws
Adverse Impact
and
Employment
Discrimination
Sexual
Harassment
Laws
2
Chapter 11
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13
Federal Employment Laws
Equal Pay Act of 1963
prohibits unequal pay for males and
females doing similar work
Civil Rights Act of 1964
prohibits discrimination on basis of
race, color, religion, gender, origin
Age Discrimination in
Employment Act of 1967
prohibits discrimination against
persons age 40 and over
Pregnancy Discrimination
Act of 1978
prohibits discrimination in employment
against pregnant women
2.1
Chapter 11
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Adapted from Exhibit 11.4
14
Federal Employment Laws (cont.)
Americans with
Disabilities Act of 1990
prohibits discrimination on the basis of
physical or mental disabilities
Civil Rights Act of 1991
strengthened the Civil Rights Act of 1964
Family & Medical Leave
Act of 1993
permits workers to take up to 12 weeks
of unpaid leave for pregnancy, etc.
Uniformed Services
Employment &
Reemployment Rights Act
prohibits discrimination against those
Adapted from Exhibit 11.4
serving in the Armed Forces
2.1
Chapter 11
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Adapted from Exhibit 11.4
15
Adverse Impact and
Employment Discrimination
Disparate
Treatment
Adverse
Impact
Four-Fifths
Rule
2.2
Intentional discrimination that
results in equally qualified
people being treated differently
Unintentional discrimination that
works to the disadvantage of
member of protected groups
Comparison of selection rates of a
protected to a nonprotected group,
to determine if adverse impact has
occurred
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16
Sexual Harassment
Quid
Pro Quo
Hostile
Work
Environment
employee outcomes depend on
whether an individual submits to
sexual harassment
unwelcome and demeaning sexually
related behavior creates an
intimidating and offensive work
environment
2.3
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17
Common Managerial Mistakes
in Sexual Harassment Laws
Assuming:

That the victim and harasser must be of the
opposite sex

That harassment can only occur between
coworkers or supervisors and subordinates

That only victims can file complaints
2.3
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18
Company Responsibilities

Respond immediately to make sure sexual
harassment laws are followed

Write a clear, understandable sexual harassment
policy


Establish clear reporting procedures
Be in compliance with federal, state, and local
sexual harassment laws
2.3
Chapter 11
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19
Finding Qualified Workers
After reading these sections,
you should be able to:
3.
explain how companies use recruiting to find
qualified job applicants.
4.
describe the selection techniques and
procedures that companies use when deciding
which applicants should receive job offers.
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20
Recruiting
Job Analysis
and
Recruiting
Internal
Recruiting
External
Recruiting
3
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21
Job Analysis and Recruiting
Information Collected by a Job Analysis
 work activities
 tools and equipment used to do the job
 context in which the job is performed
 personnel requirements for performing the job
3.1
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22
Job Analysis and Recruiting
Recruiting
Selection
Training
Performance
Separation
Appraisal
HR Subsystems
Job Description
Job
Specification
Job Analysis
3.1
Chapter 11
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Adapted From Exhibit 11.6
23
Job Analysis and Recruiting
Job
Description
written description of the basic tasks,
duties, and responsibilities required
of an employee holding a particular job
Job
Specification
a written summary of the qualifications
needed to successfully perform a job
3.1
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24
Internal Recruiting






A pool of applicants who already
work for the company
“Promotion from within”
Improves employee morale and
motivation
Reduces employer time and cost
Job posting is the procedure for
internal advertising
Career path is a planned sequence
of jobs
3.2
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25
Methods for External Recruiting







Advertising
Employee referrals
Walk-ins
Outside organizations
Employment services
Special events
Internet job sites
3.3
Chapter 11
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26
Selection
Application Forms
and Résumés
References and
Background Checks
Selection
Tests
Interviews
4
Chapter 11
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27
Topics Employers Should Avoid
1. Children
2. Age
3. Disabilities
4. Physical Characteristics
5. Name
6. Citizenship
7. Lawsuits
8. Arrest records
9. Smoking
10. AIDS/HIV
4.1
Adapted from Exhibit 11.7
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28
Doing the Right Thing
Don’t Embellish Your Résumé
 Embellishing your résumé is wrong.
 The information is legally binding—
and misrepresenting information
is breaking the law.
 If what you put on your résumé feels
wrong, don’t do it.
 Don’t embellish. Tell the truth on your résumé.
4.1
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29
References and Background Checks

References or background checks are not
always provided by previous employers

Making background checks more effective




dig deeper for more information
get permission in writing
document all checks
consider hiring private investigators
4.2
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30
Selection Tests
Specific
Ability
Assessment
Centers
Cognitive
Ability
Selection
Tests
Work
Sample
Biographical
Data
Personality
4.3
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31
Doing the Right Thing
Don’t Use Psychics, Lie Detectors, or
Handwriting Analysis to Make HR Decisions
 Companies may use these methods, but
they don’t work
 There is no scientific evidence that
handwriting analysis works
 Lie detectors are not accurate
 Polygraphs are not allowed
 Stay away from fads and use reliable procedures
4.3
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32
Interviews

Unstructured Interviews
 free-flow of questions

Structured Interviews
 interviewer uses standard set of prepared
questions

Semi-structured Interviews
 some structure combined with interviewer
judgement
4.4
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33
Questions in Structured Interviews
Situational Questions
Behavioral Questions
Background Questions
Job-Knowledge Questions
4.4
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34
Guidelines for Conducting
Effective Structured Interviews
Planning the Interview



4.4
Identify and define the KSAO needed for job
Develop key behavioral questions for each KSAO
For each KSAO , develop a list of things to look
for in applicant’s responses
KSAO: Knowledge, skills, abilities,
and other characteristics
Adapted from Exhibit 11.10
Chapter 11
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35
Guidelines for Conducting
Effective Structured Interviews
Conducting the Interview







Create a relaxed interview atmosphere
Review the applicant’s information
Allocate adequate time
Put the applicant at ease
Tell the applicant what to expect
Obtain job-related information (refer to KSAO)
Describe the job and organization
4.4
Adapted from Exhibit 11.10
Chapter 11
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36
Guidelines for Conducting
Effective Structured Interviews
After the Interview



Review your notes immediately
Evaluate the applicant on each KSAO
Determine each applicant’s probability of
success and make a hiring decision
4.4
Adapted from Exhibit 11.10
Chapter 11
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37
What Really Works
Using Selection Tests to Hire Good Workers
Cognitive Ability Tests
10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
probability of success
76%
Work Sample Tests
10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
probability of success
77%
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38
What Really Works
Using Selection Tests to Hire Good Workers
Assessment Centers
10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
probability of success
69%
Structured Interviews
10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
probability of success
76%
Chapter 11
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39
What Really Works
Using Selection Tests to Hire Good Workers
Cognitive Ability + Work Sample Tests
10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
probability of success
82%
Cognitive Ability + Integrity Tests
10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
probability of success
83%
Cognitive Ability + Structured Interviews
10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
probability of success
82%
Chapter 11
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40
Developing Qualified Workers
After reading these sections,
you should be able to:
5.
6.
describe how to determine training needs
and select the appropriate training methods.
discuss how to use performance appraisal to
give meaningful performance feedback.
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41
Training
Training
Needs
Training
Methods
Training
Evaluation
5
Chapter 11
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42
Determining Training Needs
Identify
Performance
Deficiencies
Listen to
Customer
Complaints
Conducting
Needs
Assessments
Survey
Employers
and Managers
Test Employee
Skills and
Knowledge
5.1
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43
Work Keys Needs Assessment
Step 1
Job Analysis
Step 2
Test Employee Skills
Step 3
Compare Employee Skills
to Required Skills
5.1
Chapter 11
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Adapted From Exhibit 11.11
44
Work Keys Needs Assessment
5.1
Chapter 11
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Exhibit 11.11
45
Training Methods
Impart Information
and Knowledge
• films and videos
• lecture
• planned readings
Develop Analytical
and Problem-Solving
Skills
• case studies
• coaching and mentoring
• group discussions
Practice, Learn, or
Change Job
Behaviors
•
•
•
•
All of the above
• Computer-based learning
on-the-job training
role-playing
simulations and games
vestibule training
5.2
Chapter 11
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Adapted From Exhibit 11.12
46
Evaluating Training
Reactions
how satisfied trainees were
with the program
Learning
how much employees improved
their knowledge or skills
Behavior
how much employees actually changed
their on-the-job behavior
Results
how much training improved
job performance
5.3
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47
Computer-Based Training
Chapter 11
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48
Performance Appraisal
Measuring
Job
Performance
Sharing
Performance
Feedback
6
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49
Measuring Job Performance:
Common Rating Errors

Central tendency
 all workers are rated as being “average”

Halo error
 all workers are rated as performing at the
same level in all parts of their jobs

Leniency error
 all workers are rated as performing at a
high level
6.1
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50
Measuring Job Performance
Improving Job Performance Measurements
Improve Performance
Appraisal Measures
Train
Performance Raters
6.1
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51
Improving Performance
Appraisal Measures

Objective performance measures
 quantifiable outcomes (output, scrap, waste,
sales, customer complaints, or rejection rates)

Subjective performance measures
 trait rating scales
 behavioral observation scales (BOS)
6.1
Chapter 11
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52
Subjective Performance
Appraisal Scales
6.1
Chapter 11
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Exhibit 11.13
53
Rater Training



Teach raters how to avoid errors
Improve rating accuracy
Video training and role playing often used
6.1
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54
Sharing Performance Feedback

Managers often fail to effectively give
employees performance feedback

360-degree feedback
 boss, subordinates, peers, and the employee
 best for employee development
6.2
Chapter 11
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55
Performance Feedback
Recommendations for Sharing Performance Feedback
1. Separate developmental feedback
from administrative feedback
2. Base performance appraisal feedback sessions
on self-appraisals
3. Have people discuss the feedback they
received with executive coaches or the people
who provided it
6.2
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56
Performance Feedback
What to Discuss in Performance Appraisal
Feedback Sessions
1. Overall progress
2. Problems encountered in meeting job
requirements
3. Opportunities to improve performance
4. Long-range plans and opportunities
6.2
5. General discussion of possible plans and
goals for the coming year
Chapter 11
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Adapted From Exhibit 11.14
57
Keeping Qualified Workers
After reading these sections,
you should be able to:
7.
8.
describe basic compensation strategies and
explain how they affect human resource practice.
discuss the four kinds of employee separations:
termination, downsizing, retirements, and
turnover.
Chapter 11
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58
Compensation
Compensation
Decisions
Employment
Benefits
7
Chapter 11
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59
Compensation Decisions
Pay
Level
• Job
evaluation
Pay
Variability
Pay
Structure
• Piecework
• Hierarchical
• Commission
• Compressed
• Profit
sharing
• Employee
stock
ownership
plans
7.1
Employment
Benefits
• Cafeteria
plans
• Flexible
plans
• Payroll
deductions
• Stock
options
Adapted from Exhibit 11.15
Chapter 11
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60
Pay-Level Decisions

Job evaluation is used to determine the worth
of jobs
 pay the “going rate”

Should workers be paid at, below, or above
current market wage?




attracts a larger, more qualified pool of applicants
increases the rate of job acceptance
decreases the time it takes to fill positions
increases the time that employees stay
7.1
Chapter 11
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61
Pay-Variability Decisions
 Piecework
 Commission
 Profit sharing
 Employee stock ownership plans
(ESOPs)
 Stock options
7.1
Chapter 11
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62
Pay-Structure Decisions

Hierarchical pay structures
 big differences from one pay level to another
 work best for independent work

Compressed pay structures
 fewer pay levels with smaller differences in pay
between pay levels
 work best for interdependent work
7.1
Chapter 11
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63
Employment Benefits


Compensation other than direct wages
Employee benefits are legally mandated:
 Social Security
 worker’s compensation
 unemployment insurance

Cafeteria benefit plans
 employees can select from optional benefits

Payroll deductions
7.2
Chapter 11
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64
Employee Separations
Terminations
Downsizing
Retirements
Turnover
8
Chapter 11
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65
Terminating Employees


Often mismanaged
Minimize problems in firing employees
 firing should not be the first option
 firing should be for a good reason
• “employment at will”
• wrongful discharge
 firing should be done in private
8.1
Chapter 11
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66
Downsizing
1.
2.
Provide clear reasons for the layoffs.
3.
4.
5.
6.
Training managers in how to tell employees.
Get information to avoid laying off employees with
critical skills.
Give employees the bad news early in the day.
Provide outplacement services and counseling.
Communicate with survivors.
8.2
Chapter 11
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Adapted From Exhibit 11.16
67
Retirement
Early Retirement Incentive Programs…




Offer financial benefits to
encourage employees to retire
Are attractive to many employees
Are difficult to predict which or
how many employees will use the
program
May cause the company to lose
valuable employees
8.3
Chapter 11
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68
Employee Turnover


Loss of employees who voluntarily choose
to leave the company
Functional turnover (encouraged)
 the loss of poor-performing employees

Dysfunctional turnover (discouraged)
 the loss of high performing employees
8.4
Chapter 11
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69