Human Resource Management: Fifteenth Edition

Human Resource Management
Fifteenth Edition
Chapter 1
Human Resource
Management: An
Overview
Copyright © 2019, 2016, 2014 Pearson Education, Inc. All Rights Reserved
Learning Objectives (1 of 2)
1.1 Define human resource management (HRM) and the
importance of studying it.
1.2 Recent trends in HRM and E-HRM
1.3ManagingGlobal HR and implementing Global HR system
1.4 Discuss the role of HRM in building corporate culture and
employer branding.
Learning Objectives (2 of 2)
1.5 Staffing Global Organizations.
1.6 Managing International assignee/ expatriates
1.7 Challenges of Managing Expatriates.
What Is Human Resource Management?
• The Management Process
– Planning
– Organizing
– Staffing
– Leading
– Controlling
HRM, business and management
‘Tounderstand what human resource management is, it’s
useful to start with what managers do. Most writers agree
that managing involves performing five basic functions:
planning, organizing, staffing, leading, and controlling. These
functions in total represent the management process.
• ‘Planning – involves establishing goals and standards; developing rules and
procedures; developing plans and forecasts.
• Organizing – involves giving each subordinate a specific task; establishing
departments; delegating authority to subordinates; establishing channels of
authority and communication; coordinating the work of subordinates.
• Staffing – involves determining what type of people should be hired; recruiting
prospective employees; selecting employees; setting performance standards;
compensating employees; evaluating performance; counseling employees;
training and developing employees.
• Leading – involves getting others to get the job done; maintaining morale,
motivating subordinates.
• Controlling – involves setting standards such as sales quotas, quality
standards, or production levels; checking to see how actual performance
compares with these standards; taking corrective action as needed.
. Copyright © 2019, 2016, 2014 Pearson Education, Inc. All Rights Reserved
‘HRM is the basis of all management activity.
Whatever the nature of the business, the basis of

management is always the same: getting the people of the
business to make things happen in a productive way, so that
the business prospers and the people thrive’.
Why Human Resource Management is Important
and the Human Resource Management Process
• Human resource management (HRM) can be a
significant source of competitive advantage
• HRM is an important part of organizational
strategies
• The way organizations treat their people can
significantly impact performance
9
Human Resource Management at Work

What is Human Resource Management (HRM)?
The policies and practices involved in carrying out the

‘people’ or human resource aspects of a management
position, including:
Recruiting, managing, screening, developing, orienting,

training, rewarding, and appraising employees at work.
Exhibit 12-2
HRM Process
Exhibit 12-2 shows the eight steps in the HRM process.

Human Resource Planning
• Human resource planning: ensuring that the
organization has the right number and kinds of
capable people in the right places and at the right
times
• Two steps:
– Assessing current human resources
– Meeting future HR needs
9-12
Human Resource Planning
Workforce Profile: Forecasting:

Personnel inventory Based on
- Age - Predicted sales
- Education - Current workforce skills
- Training - Technology changes
- Experience - Use of temporary workers
- Specialized skills - Turnover
- Current position - Retirement
- Previous positions - Planned reassignments
© 2016 Pearson Education, Inc.
Current Assessment
• Job analysis: an assessment that defines jobs
and the behaviors necessary to perform them
• Job description (position description): a written
statement that describes a job
• Job specifications: a written statement of the
minimum qualifications a person must possess to
perform a given job successfully
9-14
Job Descriptions and Job

Specifications
© 2016 Pearson Education, Inc.

Recruitment and Decruitment
• Recruitment: locating, identifying, and attracting
capable applicants
• Decruitment: reducing an organization’s
workforce
Selection
• Selection: screening job applicants to ensure that
the most appropriate candidates are hired
Orientation
• Orientation: introducing a new employee to his or
her job and the organization
Employee Training
• Employee training is an important HRM activity. As
job demands change, employee skills have to
change. On average, U.S. companies spent $702
per employee for training.
• Managers, of course, are responsible for deciding
what type of training employees need, when they
need it, and what form that training should take.
Performance Management
• Performance management system: establishes
performance standards used to evaluate employee
performance.
• How do managers evaluate employees’ performance?

That’s where the different performance appraisal
methods come in.
Compensation and Benefits
Managers must develop a compensation system
that reflects the changing nature of work and the
workplace in order to keep people motivated.
Organizational compensation can include many
different types of rewards and benefits such as
base wages and salaries, wage and salary,
incentive payments, and other benefits and
services.
Compensation
• All rewards that individuals receive as a result of their
employment
– Financial compensation (direct and indirect)
Direct compensation (core compensation) is the pay
that an employee receives in the form of wages, salaries,
commissions, or bonuses. Indirect compensation
(employee benefits) is often referred to as benefits, and
includes things such as paid vacations, sick leave,
holidays, and medical insurance
Career Development
• Career development is a formal approach used by the
organization to ensure that people with the proper
qualifications and experiences are available for promotion
or reassignment when needed.
Employee and Labor Relations
• Businesses are required by law to recognize a union and
bargain with it in good faith if the firm’s employees want
union representation
• Human resource activity with a union is often referred to
as labor relations
Safety and Health
• Safety: Protecting employees from injuries caused by
work-related accidents.
• Employees who work in a safe environment and enjoy
good health are more likely to be productive
Interrelationships of HRM Functions
• All HRM functions are interrelated so that each function
affects the others
• For example, a pay-for-performance compensation plan
depends upon reliable and valid performance appraisal
practices
Recent trend in the Labor Force
Age Distribution of U.S Labor Force,
2008 and 2018
Projected Racial/Ethnic Makeup of the
U.S. Workforce, 2018
Skill Deficiencies of the
Workforce
• Today, employers are • The gap between
looking for: skills needed and
– mathematical skills skills available has
– verbal skills decreased companies
– interpersonal skills ability to compete.
– computer skills • They sometimes lack
the capacity to
upgrade technology,
reorganize work, and
empower employees.
High-Performance Work Systems
• Organizations that have the best possible fit

between their:
– social system (people and how they interact);
and
– technical system (equipment and processes).
• Key trends occurring in today’s high-
performance work systems:
– reliance on knowledge workers
– the empowerment of employees to make
decisions
– the use of teamwork
Knowledge Workers
• Employees whose • They are especially
contribution to the needed for jobs in:
organization is – health services
specialized – business services
knowledge, such as: – social services
– knowledge of – engineering
customers – management
– knowledge of a
process
– knowledge of a
profession
Top 10
Occupations
for Job
Growth
Employees as Human Capital
• Capital refers to the factors that enable companies, for
example, to generate income, higher economic value,
strong positive brand identity, and reputation. There is a
variety of capital, including financial capital:
– Cash
– Capital equipment
• Human capital, as defined by economists, refers to sets
of collective skills, knowledge, and ability that employees
can apply to create value for their employers
Employer Branding
• The firm’s corporate image or culture created to attract and
retain the type of employees the firm is seeking. It is what
the company stands for in the public eye. Brands imply
what employees will get from working there, and why
working for the company is a career and not just a job
E-HRM
• E-HRM is the use of web-based technologies to provide
HRM services within employing organizations. It embrace
e-recruitment and e-learning, the first fields of human
resource management to make extensive use of web-
based technology.
• Within a system of e-HRM, it is possible for line managers
to use desktop computers to arrange and conduct
appraisals, plan training and development, evaluate labor
costs, and examine indicators for turnover and
absenteeism. Employees can also use a system of e-HRM
to plan their personal development, apply for promotion
and new jobs, and access a range of information on HR
policy. Copyright © 2019, 2016, 2014 Pearson Education, Inc. All Rights Reserved
What is Global Human Resource
Management?
– the human resource management concepts and
techniques employers use to manage the human
resource challenges of their international operations
including acquiring, training, apprising, and
compensating employees and attending to labor
relations, health and safety and fairness concerns.
– Global human resource management, sometimes

referred to as global HRM, is an umbrella term that
includes all aspects of an organization’s HR, payroll,
and talent management processes operating on a
global scale.
The Manager’s Global Challenge
• The challenge in managing globally is that what works in
one country may not work in another.
• The global employer faces differences
– Political
– Economic
– Legal
– Cultural
Country Political and Economic Structure
• In the U.S., democracy characterizes the political system
and the economy is based on capitalism
• In China, communism characterizes the political system
and the economy is based on communism
National Cultural Values
• Cultural differences create challenges for managing HR
• Cultural values pertain to the norms for behaviors and
beliefs
• National culture is steeped in a country’s history, a
society’s social traditions, political and economic
philosophy, and legal system
Cultural Factors
• Countries differ widely in their cultures
• The Hofstede Study
– Power distance
– Individualism
– Masculinity/Femininity
– Uncertainty avoidance
– Long-term orientation
Cultural Factors
• Power distance represents the degree to which less
powerful people accept the unequal distribution of power in
society. We value the American premise of “liberty and
justice for all”.
• Individualism vs. collectivism This index explores the
“degree to which people in a society are integrated into
groups. They emphasize the “I” versus the “we
• Masculinity is defined as “a preference in society for
achievement, heroism, assertiveness and material rewards
for success. In feminine societies, they share modest and
caring views and cooperation.
Cultural Factors
• Long – term oriented A poor country that is short-term
oriented usually has little to no economic development,
while long-term oriented countries continue to develop to a
point
• Uncertainty avoidance It deals with a society's tolerance
for uncertainty and ambiguity. Examples of countries
with low uncertainty avoidance scores include the United
States, England, India, China, and Singapore. Examples of
countries with high uncertainty avoidance scores include
Italy, Korea, Mexico, Belgium, and Russia.
Labor Force Characteristics and Dynamics (1 of 2)
• Labor force characteristics create challenges throughout
the world
• Every country’s labor force is shaped by a variety of
forces, for example:
– China’s one-child policy has created a labor shortage
– Japanese culture relatively disfavors romantic
relationships
44
How to Implement a Global HR System

Best practices for developing a more effective global HR
system:
1. Form global HR networks that make local HR managers

a part of global teams.
2. Remember that it is more important to standardize ends
and competencies than specific methods.
3. Dedicate adequate resources for the global HR effort.
4.It is best to work within the context of a strong corporate
culture.
45
Staffing the Global Organization (cont)
Top Management Values
Ethnocentric
International
Staffing Polycentric
Policy
Geocentric
13-46
Values and Global Staffing Policy

• Ethnocentric companies will make sure the home
country’s attitudes, management style,
knowledge, evaluation criteria, etc., prevail
through filling key management jobs with parent-
country nationals
• Polycentric companies believe that only host
country managers can understand the culture and
behavior of the host country market and the
foreign subsidiary should be managed by host-
country nationals and home office with parent-
country nationals
Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall
13-47
Values and Global Staffing Policy, cont.

• Geocentric companies believe that the best
manager for the firm could be located anywhere
so they look at all management for potential and
staff on the basis of choosing the best people for
key jobs regardless of nationality

13-48
Improving International Assignments

Through Selection
• 80% of Financial Times top 100 company CEOs
recently had overseas assignments
• Often the assignments fail due to poor expatriate
entry and reentry preparation
• Companies are taking steps to reduce expat
problems by selecting expats more carefully,
helping spouses get jobs abroad and providing
more ongoing support to the expat and family

13-49
Expatriate Personality
• Expats are increasingly
younger and single
• Tend to be extroverted,
agreeable and
emotionally stable
individuals
• Tend to have great
cultural empathy

13-50
Selecting International Managers
• Screening and testing

• Realistic previews
• Adaptability screening

13-51

• Realistic Previews – Even in the most familiar
foreign countries there will be language barriers
and challenges for the family including bouts of
homesickness, and the need to adapt to new
friends. Realistic previews about the problems as
well as about the country’s cultural benefits are
thus an important part of screening

13-52

Testing – Selection testing is useful for expat
selection. The Overseas Assignment Inventory
(OAI) is an online assessment. he “Global Mindset
Inventory” measures an international mindset.

13-53

13-54

13-55

Adaptability Screening – With adaptability
important, adaptability screening should be part of
the screening process. Such screening aims to
assess the assignee’s (and spouse’s) probable
success in handling the foreign transfer, and to
alert them to issues

Training and Maintaining Employees on
International Assignment
• Orienting and training employees on international
assignment
– Pre-departure training
– On-going training
– Ethics and Codes of Conduct
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Human Resource Management

Whatever the nature of the business, the basis of

Human Resource Management at Work

The policies and practices involved in carrying out the

Recruiting, managing, screening, developing, orienting,

Exhibit 12-2 shows the eight steps in the HRM process.

Human Resource Planning

Workforce Profile: Forecasting:

Job Descriptions and Job

© 2016 Pearson Education, Inc.

• How do managers evaluate employees’ performance?

• Organizations that have the best possible fit

– Global human resource management, sometimes

How to Implement a Global HR System

1. Form global HR networks that make local HR managers

Staffing the Global Organization (cont)

Top Management Values

Values and Global Staffing Policy

Values and Global Staffing Policy, cont.

Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall

Improving International Assignments

Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall

Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall

Selecting International Managers

• Screening and testing

Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall

Selecting International Managers

Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall

Selecting International Managers

Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall

Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall

Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall

Selecting International Managers

Copyright © 2009 Pearson Education, Inc. publishing as Prentice Hall

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