Quiz 3
Thursday 15 May
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Chapter 10
Human
Resource Management
Learning Objectives
After reading this chapter, you should be able to:
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Explain the role of human resource management in
achieving a sustainable competitive advantage.
Identify the key factors in the environment affecting
the management of human resources.
Describe the human resource planning process.
Explain the key components of staffing and their
importance.
Describe how training and career development
provide employees with tools to succeed once they are
hired.
Identify the purposes of performance appraisal and
how it might be conducted.
Describe the key objectives of the compensation
system and its components.
Dealing effectively with
human resource (HR)
issues is essential for all
managers.
The human resource
staff supports managers
in carrying out HR
responsibilities.
Environment of Human
Resources
Workforce
Diversity
Unions
Globalization
Legislation
Key Federal Legislation and
Regulations Affecting HR
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Social Security Act (1935)
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Wagner Act (1935)
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Fair Labor Standards Act (1938)
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Taft-Hartley Act (1947)
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Landrum-Griffin Act (1959)
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Equal Pay Act (1963)
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Title VII of Civil Rights Act (1964)
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Executive Order 11246 (1965)
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Age Discrimination in
Employment Act (1967)
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Wage Garnishment Act (1968)
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Occupational Safety and Health
Act (1970)
Vocational Rehabilitation Act
(1973)
Health Maintenance Organization
Act (1973)
Employee Retirement Income
Security Act (1974)
Vietnam-Era Veterans
Readjustment Act (1974)
Privacy Protection Act (1974)
Pregnancy Discrimination Act
(1978)
Key Federal Legislation and
Regulations Affecting HR (cont)
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Job Training Partnership Act
(1982)
Consolidated Omnibus Budget
Reconciliation Act (1985)
Immigration Reform and
Control Act (1986)
Worker Adjustment and
Retraining Act (1988)
Drug-Free Workplace Act
(1988)
Employee Polygraph
Protection Act (1988)
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Americans with Disabilities Act
(1990)
Civil Rights Act (1991)
Family and Medical Leave Act
(1993)
Health Insurance Portability
and Accountability Act (1996)
Small Business Job Protection
Act (1996)
Fair Credit Reporting Act
(1970, 1996)
Discrimination
Employment
at Will
Sexual
Harassment
Key HR
Legislative
Issues
Protected
Class
Affirmative
Action
Disparate
Treatment
BFOQ
Adverse Impact
Job
Relatedness
Civil Rights Act of 1964
Designed to prevent discrimination
 Protected class includes persons of color
and women
 Affirmative action – fair employment
 Forms of discrimination
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Disparate
Adverse
Employer defenses include job
relatedness, qualification, seniority
Other legislative influences
Drug-free Workplace Act
 Family and Medical Leave act
 Sexual harassment (Civil Rights Act)
 Note Manager’s Notebook 10.1 on Don’ts
of Interviewing
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Could lead to interpretations that interviewer is
violating the law.
These continue to be violated due to
ignorance.
Unions
 Membership
in 2006)
 Factors
has been declining steadily (13%
contributing to this decline:
 Strong
employer challenges to unions
 Plant closures
 International competition
 Shrinking manufacturing sector
 Labor
Contract: Written agreement between
union and management that specifies pay
schedule, fringe benefits, COLA, and the like.
Unions (cont)
 Union-related
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legislations:
The Wagner Act (1935) – created the NLRB
The Taft-Hartley Act (1947) – specified a set of
unfair labor practices by unions along with the
remedies
The Landrum-Griffin Act (1959) – requires each
union to report its financial activities and the
financial interests of its leaders to the Department
of Labor
 In
the U.S., labor relations are characterized
by:
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Business unionism
Job-based unionism
Collective bargaining
Voluntary contracts
Adversarial relationships
Human Resource
Management Process
Strategic HR
Planning
HR Tactics
Staffing
Orientation
Training
Performance
Appraisal
Compensation
and Benefits
Career
Development
Strategic Human Resource
Planning (SHRP)
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The development of a
vision about where the
company wants to be
and how it can use
human resources to get
there.
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The ultimate objective
of SHRP is a sustained
competitive advantage.
Human Resource Planning
Product
Demand
Labor
Productivity
Internal Labor
Market
Labor Demand
1.
External Labor
Market
Labor Supply
Conditions and Select Responses
Labor demand exceeds labor supply
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Training or retraining
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Succession planning
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Promotion from within
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Recruitment from outside
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Subcontracting
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Use of contingent workers
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Use of overtime
2.
3.
Labor supply exceeds labor demand
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Pay cuts
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Reduced hours
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Work sharing
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Voluntary early retirements
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Inducements to quit
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Layoffs
Labor demand equals labor supply
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Replacement of quits from
inside or outside
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Internal transfers and
redeployment
Staffing Process
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Recruitment – the process of
generating a pool of qualified
candidates for a particular
job.
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An effective recruitment
effort should create a pool of
qualified applicants.
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Selection – the screening
process used to decide which
of the applicants to hire.
Validity and Reliability of
Selection Tools
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Validity is how well a technique used to
assess candidates is related to performance
on the job.
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Validity can be demonstrated by:
 Content Validity
 Empirical Validity
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Reliability is a measure of the consistency of
results of the selection method.
Application
Forms
Performance
Simulation Tests
Letters of
Recommendation
SELECTION
TOOLS
Ability Tests
Personality
Tests
Psychological
Tests
Honesty Tests
Interviews
Physical Exams
Orientation
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Helps new employees to:
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Learn more about the company
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Learn what is expected of them in
the job

Reduce the initial anxiety of a
transition
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Become familiar with co-workers
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Learn about work rules and
personnel policies
Employee Training
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Training is a planned effort
to provide employees with
specific skills to improve
their performance.
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Effective training can also
improve morale and increase
an organization’s potential.
The Training Process
Develop and
Conduct Training
Needs Assessment
• Organization Needs
• Task Needs
• Person Needs
• Location
• Presentation
• Type
Evaluation
Training Presentation
Techniques
Slides and
Videotapes
ComputerAssisted
Instruction (CAI)
Classroom
Lectures
Simulations
Cross-functional
Training
Vestibule
Training
Virtual Reality
Career Development

Long-term effort in which
the organization helps
employees utilize their full
potential.
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Involves three major phases:

Assessment

Direction

Development
The Career Development
Process
Direction
Assessment
• Promotability forecasts
• Succession planning
• Individual career counseling
• Job posting systems
• Career resource centers
Development
• Mentoring
• Coaching
• Job rotation
• Tuition assistance programs
Performance Appraisal
Performance appraisal has
three important objectives:
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Two-way communication
between supervisors and
employees.
Constructive feedback to
employees in order to
capitalize on strengths and
reduce weaknesses.
Help managers decide who
should be paid more based on
contribution.
Approaches to Performance
Appraisal
Judgment Approaches
 Relative judgments
 Absolute judgments
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Measure Approaches
Traits
Behaviors
Behavioral
anchored rating
scales
Outcomes
 MBO
Compensation
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Employees are paid for their
contributions to the
company.
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The three key objectives of
the compensation system
are to:
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Attract high-quality workers
from the labor market.
Retain the best employees the
company already has.
Motivate employee
performance.
Components of Total
Compensation
Total Compensation
Base Compensation
Pay Incentives
Indirect Compensation /
Benefits
Compensation System Should:
 Fit
the firm’s strategic objectives
 Fit
with the firm’s characteristics and
environment
 Achieve
internal equity (perception of
fairness)
 Achieve
 Be
external equity
based on employee contributions
Video Summary: Patagonia
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What does workforce diversity mean at
Patagonia?
Individual/Collaborative Learning case
10.1 . . . P. 425
Discuss the Question 1 & 2 on p. 426 with
two other classmates.
 Write your thoughts on how you would
respond to the challenge posed in the
Learning Exercise.
 Give each member of your trio a chance to
read your work (and read theirs.)
 Discuss
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