STRATEGIC HUMAN RESOURCE MANAGEMENT

What Is Human Resource Management?

An organization consists of people with formally assigned roles who work together to achieve
the organizations goals. A manager is the person responsible for accomplishing the
organizations goals, who does so by managing the efforts of the organizations people.
Most experts agree that managing involves five functions: planning, organizing, staffing,
leading, and controlling. In total, these functions represent the management process. Some
of the specific activities involved in each function include:
Human resource management is the process of acquiring, training, appraising, and
compensating employees, and of attending to their labor relations, health and safety, and
fairness concerns.
And what a manager should know about:
* Equal opportunity and affirmative action
* Employee health and safety
* Handling grievances and labor relations

Manager – The person responsible for accomplishing the organization’s goal, and who does
so by managing (planning, organizing, staffing, leading, and controlling) the efforts of the
organization’s people.
Management process – The five basic functions of planning, organizing, staffing, leading,
and controlling.

STRATEGIC HUMAN RESOURCE MANAGEMENT

Strategic management
The word ‘strategy’, deriving from the Greek noun strategus, meaning ‘commander in chief’,
was first used in the English language in 1656. The development and usage of the word
suggests that it is composed of stratos (army) and agein (to lead).
Strategic management is the ongoing planning, monitoring, analysis and assessment of all
necessities an organization needs to meet its goals and objectives. Changes in business
environments will require organizations to constantly assess their strategies for success.

Strategic management is considered to be a continuous activity that requires a constant

adjustment of three major interdependent poles:
1. the values of senior management
2. the environment, and
3. the resources available

Strategic Human Resource Management SHRM – is the process of linking the human
resource function with the strategic objectives of the organization in order to improve
performance.
Importance of Strategic Human Resource Management (SHRM) There are various
benefits of applying strategic human resource management for any business. These include:
 Increased job satisfaction
 Better work culture
 Improved rates of customer satisfaction
 Efficient resource management
 A proactive approach to managing employees
 Productivity boost
Why Is Human Resource Management Important to All Managers?
These concepts and techniques important to all managers for several reasons.
A. AVOID PERSONNEL MISTAKES First, having a command of this knowledge will help you
avoid the sorts of personnel mistakes you don t want to make while managing. For example,
no manager wants to:
* Hire the wrong person for the job
* Experience high turnover
* Have your people not doing their best
* Waste time with useless interviews
* Commit any unfair labor practices

Line and Staff Aspects of Human Resource Management

Authority is the right to make decisions, to direct the work of others, and to give orders.
Line authority is the chain of command within an organization that confers the power to order
subordinates to perform a task within their job description. Line authority therefore creates a
superior (order giver) subordinate (order receiver) relationship.
Staff authority gives a manager the right to advise other managers or employees. It creates
an advisory relationship. When the human resource manager suggests that the plant manager
use a particular selection test, he or she is exercising staff authority.
On the organization chart, managers with line authority are line managers. Those with staff
(advisory) authority are staff managers. In popular usage, people tend to associate line
managers with managing departments (like sales or production) that are crucial for the
company s survival.
Line manager is a manager who is authorized to direct the work of subordinates and is
responsible for accomplishing the organization’s tasks.
Staff managers generally run departments that are advisory or supportive, like purchasing,
and human resource management. Human resource managers are usually staff managers.
They assist and advise line managers in areas like recruiting, hiring, and compensation.
Examples of human resource management specialties include:
* Recruiters. Search for qualified job applicants.
* Equal employment opportunity (EEO) coordinators. Investigate and resolve EEO
grievances; examine organizational practices for potential violations; and compile and
submit EEO reports.
* Job analysts. Collect and examine information about jobs to prepare job descriptions.
* Compensation managers. Develop compensation plans and handle the employee benefits
program.
* Training specialists. Plan, organize, and direct training activities.
* Labor relations specialists. Advise management on all aspects of union management
relations.

Globalization refers to the tendency of firms to extend their sales, ownership, and/or
manufacturing to new markets abroad.

Human capital refers to the knowledge, education, training , skills, and expertise of a firm’s
workers.
Talent management is the goal-oriented and integrated process of planning, recruiting,
developing, managing, and compensating employees. It involves instituting a coordinated
process for identifying, recruiting, hiring, and developing high-potential employees.

THE ANALYSIS AND DESIGN WORK

JOB ANALYSIS AND THE TALENT MANAGEMENT PROCESS
The Talent Management Process
Talent management – is the goal-oriented and integrated process of planning, recruiting,
developing, managing, and compensating employees.
Talent management is how employers recruit and develop a workforce that is as productive as
possible and likely to stay with their organization long term. When implemented strategically,
this process can help improve the overall performance of the business and ensure that it
remains competitive.
USES OF JOB ANALYSIS INFORMATION
Job analysis is important because managers use it to support just about all their human
resource management activities.
RECRUITMENT AND SELECTION Information about what duties the job entails and what
human characteristics are required to perform these activities helps managers decide what
sort of people to recruit and hire.
EEO COMPLIANCE Job analysis is crucial for validating all major human resources practices.
For example, to comply with the Americans with Disabilities Act, employers should know each
jobs essential job functions which in turn requires a job analysis.
PERFORMANCE APPRAISAL A performance appraisal compares each employee s actual
performance with his or her duties and performance standards. Managers use job analysis to
learn what these duties and standards are.
COMPENSATION, Compensation (such as salary and bonus) usually depends on the job s
required skill and education level, safety hazards, degree of responsibility, and so on all
factors you assess through job analysis.
TRAINING The job description lists the jobs specific duties and requisite skills and therefore
the training that the job requires.
Job analysis is important in helping employers execute their overall strategic plans. The
accompanying Strategic Context feature illustrates this.

Conducting a Job Analysis

Job analysis is the process of studying a job to determine which activities and responsibilities
it includes, its relative importance to other jobs, the qualifications necessary for performance
of the job and the conditions under which the work is performed. An important concept in job
analysis is that the job, not the person doing the job, is assessed, even though human
resources (HR) may collect some job analysis data from incumbents.
Job analysis is often confused with job evaluation, but the two activities are quite different.
Job evaluation is the process of comparing a job to other jobs within the organization to
determine the appropriate pay rate and is not addressed in this toolkit.
Information Collection
Job analysis involves collecting information on characteristics that differentiate jobs.
Job Analysis Methods
The following describes the most common job analysis methods.
a. Open-ended questionnaire
Job incumbents and/or managers fill out questionnaires about the KSAs necessary for the job.
HR compiles the answers and publishes a composite statement of job requirements. This
method produces reasonable job requirements with input from employees and managers and
helps analyze many jobs with limited resources.

b. Highly structured questionnaire

These questionnaires allow only specific responses aimed at determining the frequency with
which specific tasks are performed, their relative importance and the skills required. The
structured questionnaire is helpful to define a job objectively, which also enables analysis with
computer models.
c. Interview
In a face-to-face interview, the interviewer obtains the necessary information from the
employee about the KSAs needed to perform the job. The interviewer uses predetermined
questions, with additional follow-up questions based on the employee's response. This
method works well for professional jobs.

d. Observation
Employees are directly observed performing job tasks, and observations are translated into
the necessary KSAs for the job. Observation provides a realistic view of the job's daily tasks
and activities and works best for short-cycle production jobs.

e. Work diary or log

A work diary or log is a record maintained by the employee and includes the frequency and
timing of tasks. The employee keeps logs over a period of days or weeks. HR analyzes the
logs, identifies patterns and translates them into duties and responsibilities. This method
provides an enormous amount of data, but much of it is difficult to interpret, may not be job-
related and is difficult to keep up-to-date.

WORKFLOW ANALYSIS AND JOB REDESIGN

Workflow analysis is a detailed study of the flow of work from job to job in a work process.
Business process reengineering means redesigning business processes, usually by
combining steps, so that small multifunction teams using information technology do the jobs
formerly done by a sequence of departments.

JOB REDESIGN

Job rotation means systematically moving workers from one job to another.

Job enrichment means redesigning jobs in a way that increases the opportunities for the
worker to experience feelings of responsibility, achievement, growth, and recognition.

The job description describes the activities and responsibilities of the job, as well as its
important features, such as working conditions. The job specification summarizes the
personal qualities, traits, skills, and background required for getting the job done.

PERSONNEL PLANNING AND RECRUITING

Workforce Planning And Forecasting

Workforce (or employment or personnel) planning is the process of deciding what

positions the firm will have to fill, and how to fill them. It embraces all future positions, from
maintenance clerk to CEO. However, most firms call the process of deciding how to fill
executive jobs succession planning.

Strategy and Workforce Planning

Employment planning should reflect the firm’s strategic plans. The managers should control
their strategy.

Forecasting Personnel Needs (Labor Demand)

A firm s staffing needs reflect demand for its products or services, adjusted for changes the
firm plans to make in its strategic goals and for changes in its turnover rate and productivity.
Forecasting workforce demand therefore starts with estimating what the demand will be for
your products or services. Short term, management should be concerned with daily, weekly,
and seasonal forecasts.

The basic process of forecasting personnel needs is to forecast revenues first. Then estimate
the size of the staff required to support this sales volume.

Qualifications (or skills) inventories – Manual or computerized records listing employees’

education, career and development interests, languages, special skills, and so on, to be used
in selecting inside candidates for promotion.

personnel replacement charts - Company records showing present performance and

promotability of inside candidates for the most important positions.

position replacement card - A card prepared for each position in a company to show
possible replacement candidates and their qualifications.

Forecasting the Supply of Outside Candidates

Employee recruiting - Finding and/or attracting applicants for the employer’s open positions.

The Recruiting Yield Pyramid

The manager should recognize that filling a relative handful of positions might require
recruiting dozens or hundreds of candidates. Employers therefore use a staffing or recruiting
yield pyramid.

Recruiting yield pyramid - The historical arithmetic relationships between recruitment leads
and invitees, invitees and interviews, interviews and offers made, and offers made and offers
accepted.

Given these ratios, the firm knows it must generate about 1,200 leads to be able to invite 200
viable candidates to its offices for interviews. The firm will then interview about 150 of those
invited, and from these it will make 100 offers, and so on.
INTERNAL SOURCES OF CANDIDATES

Finding Internal Candidates

Job posting means publicizing the open job to employees (usually by literally posting it on
company intranets or bulletin boards). These postings list the jobs attributes, like
qualifications, supervisor, work schedule, and pay rate.

Rehiring, former employees are already familiar with how you do things. On the other hand,
employees who you let go may return with negative attitudes.

Succession Planning - the ongoing process of systematically identifying, assessing, and

developing organizational leadership to enhance performance.

OUTSIDE SOURCES OF CANDIDATES

Alternative staffing - The use of nontraditional recruitment sources.

 Outsourcing means having outside vendors supply services (such as benefits
management, market research, or manufacturing) that the company s own employees
previously did in-house.
 Offshoring means having outside vendors or employees abroad supply services that
the company s own employees previously did in-house.

Executive recruiters (also known as headhunters) are special employment agencies

employers retain to seek out top-management talent for their clients.

On-demand recruiting services (ODRS) provide short-term specialized recruiting assistance

to support specific projects without the expense of retaining traditional search firms. They are
recruiters who are paid by the hour or project, instead of a percentage fee.

College recruiting sending an employer’s representatives to college campuses to prescreen

applicants and create an applicant pool from the graduating class.

Internships. Many college students get their jobs through college internships.

SELECTION AND PLACEMENT

WHY CAREFUL SELECTION IS IMPORTANT
It is important for three main reasons: performance, costs, and legal obligations.
 PERFORMANCE First, your own performance always depends on your subordinates.
Employees with the right skills will do a better job for you and the company.
 COST Second, it is important because it’s costly to recruit and hire employees.
 LEGAL OBLIGATIONS Third, it’s important because mismanaging hiring has legal
consequences.
Negligent hiring means hiring employees with criminal records or other problems who then
use access to customers’ homes (or similar opportunities) to commit crimes. In one case,
Ponticas v. K.M.S. Investments, an apartment manager with a passkey entered a woman’s
apartment and assaulted her. The court found the apartment complex s owner negligent for not
checking the manager s background properly.
BASIC TESTING CONCEPTS
A test is one popular selection tool. A test is basically a sample of a persons’ behavior. Using a
test (or any selection tool) assumes the tool is both reliable and valid. Few things illustrate
evidence-based HR the deliberate use of the best-available evidence in making decisions
about the human resource management practices you are focusing on as do checking for
reliability and validity.
Negligent hiring - Hiring workers with questionable back grounds without proper safeguards.
Reliability - The consistency of scores obtained by the same person when retested with the
identical tests or with alternate forms of the same test.
Test validity - The accuracy with which a test, interview, and so on measures what it purports
to measure or fulfills the function it was designed to fill.

Evidence-Based HR: How to Validate a Test

STEP 1: ANALYZE THE JOB

The first step is to analyze the job and write job descriptions and job specifications.
STEP 2: CHOOSE THE TESTS
Employers usually base this choice on experience, previous research, and best guesses.
STEP 3: ADMINISTER THE TEST
Here you administer the test to applicants before you hire them.
STEP 4: RELATE YOUR TEST SCORES AND CRITERIA
The next step is to ascertain if there is a significant relationship between test scores (the
predictor) and performance (the criterion).
STEP 5: CROSS-VALIDATE AND REVALIDATE
Before using the test, you may want to check it by cross-validating in other words, by again
performing steps 3 and 4 on a new sample of employees.

TYPES OF TESTS
We can conveniently classify tests according to whether they measure cognitive (mental)
abilities, motor and physical abilities, personality and interests, or achievement.

Tests of Cognitive Abilities

Cognitive tests include tests of general reasoning ability (intelligence) and tests of specific
mental abilities like memory and reasoning.

INTELLIGENCE TESTS Intelligence (IQ) tests are tests of general intellectual abilities. They
measure not a single trait but rather a range of abilities, including memory, vocabulary, verbal
fluency, and numerical ability. An adults IQ score is a derived score. It reflects the extent to
which the person is above or below the average adult s intelligence score.

SPECIFIC COGNITIVE ABILITIES There are also measures of specific mental abilities, such
as reasoning, verbal comprehension, memory, and numerical ability.
Psychologists often call such tests aptitude tests, since they purport to measure aptitude for
the job in question.

Tests of Motor and Physical Abilities

Tests of physical abilities may also be required. These include static strength (such as lifting
weights), dynamic strength (like pull-ups), body coordination (as in jumping rope), and
stamina. Thus, applicants for the U.S. Marines must pass its Initial Strength Test (2 pull ups,
35 sit-ups, and a 1.5 mile run).

WHAT DO PERSONALITY TESTS MEASURE?

Personality tests measure basic aspects of an applicant s personality, such as introversion,

stability, and motivation.

THE BIG FIVE

What traits to measure?
Industrial psychologists often focus on the big five personality dimensions:
 Extraversion
 emotional stability/neuroticism
 agreeableness
 conscientiousness
 openness to experience

WORK SAMPLES AND SIMULATIONS

Work Sampling Technique. A testing method based on measuring performance on actual basic job
tasks. The work sampling technique tries to predict job performance by requiring job candidates to
perform one or more samples of the jobs’ tasks.

Basic Procedure. The basic procedure is to select a sample of several tasks crucial to
performing the job, and then to test applicants on them. An observer monitors performance on
each task, and indicates on a checklist how well the applicant performs.

Achievement Tests measure what someone has learned. Most of the tests you take in school
are achievement tests. They measure your job knowledge in areas like economics,
marketing, or human

situational test - A test that requires examinees to respond to situations representative of the
job.
video-based simulation - A situational test in which examinees respond to video simulations of
realistic job situations.

Situational judgment tests are personnel tests designed to assess an applicant s judgment
regarding a situation encountered in the workplace. As an example, You are facing a project
deadline and are concerned that you may not complete the project by the time it is due