Part

Part 1:
1: Nature
Nature of
of Human
Human Resource
Resource
Management
Management

Chapter 1: Changing Nature of Human

Resource Management

Prepared by Linda Eligh, University of Western Ontario

11
Copyright 2008 by Nelson, a division of Thomson Canada Limited.
 Learning
Learning Objectives
Objectives
After you have read this chapter, you should be able to:
1. Define HR management and identify the seven
categories of HR activities.
2. Discuss management of human capital in
organizations.
3. Discuss four challenges facing HR today.
4. Describe how the major roles of HR management are
being transformed.
5. Identify the purposes and uses of HR technology.
6. Discuss why ethical issues affect HR management.
7. Explain the key competencies needed by HR
professionals and why certification is important.

Copyright 2008 by Nelson, a division of Thomson 12

 Nature
Nature of
of Human
Human Resource
Resource Management
Management
Human Resource (HR) Management
The policies, practices and systems that influence
employees behaviour, attitude and performance in
the attainment of organizational goals.
Who is an HR Manager?
In the course of carrying out their duties, every
operating manager is, in essence, an HR manager.
HR specialists design processes and systems that
operating managers help implement.

Copyright 2008 by Nelson, a division of Thomson 13

 HR
HR Management
Management Activities
Activities Fig.
Fig.1-1
1-1

Copyright 2008 by Nelson, a division of Thomson 14

 Nature
Nature of
of Human
Human Resource
Resource Management
Management

HR Activities:
Global forces and HR Management
Strategic HR Management
Equal Employment Opportunity
Staffing

Copyright 2008 by Nelson, a division of Thomson 15

 Nature
Nature of
of Human
Human Resource
Resource Management
Management

HR Activities (contd):
HR Development

Compensation and Benefits

Health, Safety, and Security

Employee and Labour Relations

Copyright 2008 by Nelson, a division of Thomson 16

Nature
Nature of
of Human
Human Resource
Resource Management
Management
Smaller Organizations and HR Management

Shortage
Shortage ofof
Qualified
Qualified
Workers
Workers

Increasing
Increasing
Increasing
Increasing Costs
Costs
Competition
Competition (Benefits)
(Benefits)
Issues ofof
Issues
Greatest
Greatest
Concern
Concern

Increased
Increased Legislative
Legislative
Wage
Wage Changes
Changes
Pressures
Pressures

Copyright 2008 by Nelson, a division of Thomson 17

Typical
Typical Division
Divisionof
ofHR
HRResponsibilities:
Responsibilities: Training
Training Fig.
Fig.1-2
1-2

Copyright 2008 by Nelson, a division of Thomson 18

 Management
Management ofof Human
Human Capital
Capital
in
in Organizations
Organizations
Human Capital
The collective value of the capabilities, knowledge,
skills, life experiences, and motivation of an
organizational workforce.
Alsoknown as intellectual capital.
How to measure the strategic value of human assets?

Human Resources as Core Competency

A unique capability that creates high value and
differentiates an organization from its competition.
HR competencies: a source of competitive advantage.

Copyright 2008 by Nelson, a division of Thomson 19

 HR
HR Management
Management Challenges
Challenges

Most prevalent challenges facing HR management:

1. Globalization of Business
2. Economic and Technological Changes
3. Labour
4. Workforce Demographics and Diversity
5. Organizational Cost Pressures and
Restructuring

Copyright 2008 by Nelson, a division of Thomson 110

 HR
HR Management
Management Challenges
Challenges

1. Globalization of Business
Outsourcing and offshoring
Global security and terrorism
2. Economic and Technological Changes
Occupational shifts from manufacturing and
agriculture to service and telecommunications. Job
growth primarily in IT and healthcare
Workforce availability and quality concerns
Inadequate supply of workers with soft
skills needed for knowledge jobs
Significant shortage across Canada of
tradespeople

Copyright 2008 by Nelson, a division of Thomson 111

 HR
HR Management
Management Challenges
Challenges
3. Labour
Employee retention
Growth of contingent workforce
Increases in temporary workers, independent
contractors, leased employees, and part timers
caused by need for flexibility in staffing, more
difficulties in firing regular employees, and
reduced legal liability for contractors.
Technological shifts and the Internet
Growth of information technology creating more
virtual employees and other challenges
Employability Skills

Copyright 2008 by Nelson, a division of Thomson 112

 HR
HR Management
Management Challenges
Challenges

4. Workforce Demographics and Diversity

Multiculturalism
Visible minorities and diversity
20% of workforce born outside Canada
with growing presence of visible minorities
More women in the workforce
Single-parent households, dual career
couples, domestic partners, working
mothers and family/childcare
Aging workers
Significant numbers of experienced
employees are retiring, changing to part time etc.
Age discrimination

Copyright 2008 by Nelson, a division of Thomson 113

 HR
HR Management
Management Challenges
Challenges

5. Organizational Cost Pressures, Restructuring

Mergers and Acquisitions
Right-sizingeliminating layers of management,
closing facilities, merging with other organizations,
and outplacing workers
Intended results are flatter organizations, increases in
productivity, quality, service and lower costs.
Costs are survivor mentality, loss of employee loyalty, and
turnover of valuable employees.
HR managers must work toward ensuring
cultural compatibility in mergers.

Copyright 2008 by Nelson, a division of Thomson 114

 HR
HR Management
Management Roles
Roles
Administrative Role
Clerical and administrative support operations (e.g.,
payroll and benefits work)
Technology is transforming how HR services are delivered.
Outsourcing HR services to reduce HR staffing costs

Operational and Employee Advocate Role

Champion for employee concerns
Employee crisis management
Responding to employee complaints

Copyright 2008 by Nelson, a division of Thomson 115

 Changing
Changing Roles
Roles of
of HR
HR Management
Management Fig.
Fig.1-4
1-4

Note: Example percentages are based on various surveys.

Copyright 2008 by Nelson, a division of Thomson 116

 HR
HR Management
Management Roles
Roles
Strategic Role
Contributing at the Table to organizational results
HR becomes a strategic business partner by:
Focusing on developing HR programs that enhance
organizational performance.
Involving HR in strategic planning at the onset.
Participating in decision making on mergers, acquisitions,
and downsizing.
Redesigning organizations and work processes
Accounting and documenting the financial results of HR
activities.

Copyright 2008 by Nelson, a division of Thomson 117

 Operational
Operationalto
toStrategic
StrategicTransformation
Transformationof
ofHR
HR Fig.
Fig.1-5
1-5

Copyright 2008 by Nelson, a division of Thomson 118

 HR
HR Management
Management Roles
Roles
Collaborative HR
The process of HR professionals from several
different organizations working jointly to address
shared business problems.
Firms benefit from the expertise of other firms,
without having the time and expense of developing
some of their own HR practices.

Copyright 2008 by Nelson, a division of Thomson 119

 HR
HR Technology
Technology
Human Resource Management System (HRMS)
An integrated system providing information used by HR
management, in conjunction with other managers, in
decision making.
Purposes (Benefits) of HRMS
Administrative and operational efficiency in compiling HR data
Availability of data for effective HR strategic planning

Uses of HRMS
Automation of payroll and benefit activities
EEO/affirmative action tracking
HR Workflow: increased access to HR information

Employee self-service reduces HR costs.

Copyright 2008 by Nelson, a division of Thomson 120

 Web
Figure
Web
Figure Based
1-6: Web
Based
1-6: WebSystems
Based
Based Systems
Systems Systems
Fig.
Fig.1-6
1-6

Bulletin boards
What information will be available and what is information
needed?
Data access
To what uses will the information be put?
Employee self-service
Who will be allowed to access to what information?
Web-based services and access

Extended linkage
When, where, and how often will the
information be needed?

Copyright 2008 by Nelson, a division of Thomson 121

 Ethics
Ethics and
and HR
HR Management
Management

Firms with High Ethical Standards

Are more likely to reach strategic goals.
Are viewed more positively by stakeholders
Are better able to attract and retain human resources.
Ethics and Global Differences
Different legal, political, and cultural factors in other
countries can lead to ethical conflicts for global
managers.
Corruption of Foreign Public Officials Act
Prohibits Canadian firms from engaging in bribery and other
practices in foreign countries.

Copyright 2008 by Nelson, a division of Thomson 122

 Ethics
Ethics and
and HR
HR Management
Management

HRs Role in Organizational Ethics:

HR management plays a key role as the keeper and
voice of organizational ethics.
What is Ethical Behaviour?
What ought to be done.
Dimensions of decisions about ethical issues in
management:
Extended consequences
Multiple alternatives
Mixed outcomes
Uncertain consequences
Personal effects

Copyright 2008 by Nelson, a division of Thomson 123

CCHRA
CCHRACHRP
CHRPNational
NationalCode
Codeof
of Ethics
Ethics Fig.
Fig.1-7
1-7

.
1. Preamble
2. Competence CCHRA/CHRP

3. Legal Requirements
4. Dignity in the workplace
5. Balancing Interests
6. Confidentiality
7. Conflict of Interest
8. Professional Growth and
Support of Other
Professionals
9. Enforcement
Copyright 2008 by Nelson, a division of Thomson 124
 Ethics
Ethics and
and HR
HR Management
Management
HRs Role in Organizational Ethics:
Responses to Ethical Situations
Are guided by values and personal behaviour codes
that include:
Does response meet all applicable laws, regulations, and
government codes?
Does response comply with all organizational standards of
ethical behaviour?
Does response pass the test of professional standards for
ethical behaviour?

Copyright 2008 by Nelson, a division of Thomson 125

Examples
Examplesof
ofEthical
EthicalMisconduct
Misconduct in
inHR
HRActivities
Activities Fig.
Fig.1-8
1-8

Copyright 2008 by Nelson, a division of Thomson 126

 Ethics
Ethics and
and HR
HR Management
Management

Ethical Behaviour and Organizational Culture:

Organizational Culture
The shared values and beliefs in an organization
Common forms of unethical conduct:
Lying to supervisors
Employee drug use or alcohol abuse
Falsification of records
Fostering Ethical Behaviour
A written code of ethics and standards of conduct
Training on ethical behaviour for all employees
A means for employees to obtain ethical advice
Confidential reporting systems for ethical misconduct

Copyright 2008 by Nelson, a division of Thomson 127

 HR
HR Management
Management Competencies
Competencies
and
and Careers
Careers
Important HR Competencies
Strategic contribution to organizational
success
Business knowledge of the organization and
its strategies
Effective and efficient delivery of HR services
Familiarity with HRMS technology
Personal credibility

Copyright 2008 by Nelson, a division of Thomson 128

Human
HumanResources
ResourcesProfessional
ProfessionalCapabilities
CapabilitiesProfile
Profile Fig.
Fig.1-9
1-9

Copyright 2008 by Nelson, a division of Thomson 129

 HR
HR Management
Management Competencies
Competencies
and
and Careers
Careers
HR Management as a Career Field
HR Generalist
A person with responsibility for performing a variety of
HR activities.
HR Specialist
A person with in-depth knowledge and expertise in a
limited area of HR.

Copyright 2008 by Nelson, a division of Thomson 130

Expected
ExpectedEarnings
Earningsby
byAge
Agefor
for an
anHR
HRManager
Manager Fig.
Fig.1-10
1-10

Copyright 2008 by Nelson, a division of Thomson 131

 HR
HR Management
Management Competencies
Competencies
and
and Careers
Careers
HR Professionalism and Certification
Professional Involvement and Development
Involvement by HR Professionals in professional
associations and organizations has become important
because of the broad range of issues they face.
Examples include:
Human Resources Professionals Association of
Ontario (HRPAO)
Canadian Public Personnel Management
Association (CPPMA)

Copyright 2008 by Nelson, a division of Thomson 132

 HR
HR Management
Management Competencies
Competencies
and
and Careers
Careers
CHRP Designation
Administered by the Canadian Council of Human
Resource Associations (CCHRA) in partnership with
provincial Human Resources associations.

Eligibility requirements vary by provincial

associations, but the National Knowledge Exam
(NKE) and Professional Practice Exam (PPE) is the
same for everyone.

Copyright 2008 by Nelson, a division of Thomson 133