ENGINEERING MANAGEMENT

Lesson No. 8 – Managing Human

Resource
Specific Objectives of the Lesson
 At the end of the lesson, the student should be able to:
 Outline the human resources management process;
 Explain how human resource planning is conducted;
 Differentiate between internal and external recruiting;
 Assess the usefulness of the major selection methods;
 Explain the main phases in the training process as well
as the most common types of training programs;
 Know the importance of the major methods of rating
performances;
 Explain how pay structure are developed and how
benefits figure in compensation;
 Know the importance of maintaining effective work-
force relationships
HUMAN RESOURCE MANAGEMENT
 Human Resource Management
(HRM) – is the management of
various activities designed to enhance
the effectiveness of an organization’s
work force in achieving organizational
goals.
Factors to Consider in the
Management of Human Resources
STRATEGIC HUMAN RESOURCE
MANAGEMENT
 Forward looking organizations like
CARE, are the forefront of a trend
toward recognizing human resource
as a crucial element in the strategic
success of organizations.
 Human resources management
encompasses a number of important
activities as indicated in the HRM
PROCESS
 The HRM Process

Human Maintaining
Development
Resource Staffing Compensation Effective
and Evaluation
Planning Workforce
Relationship
HUMAN RESOURCE PLANNING
 It is the process of determining future
human resource needs relative to an
organization’s strategic plan and
devising the steps necessary to meet
those needs.
 Such planning often relies on job
analysis as a means of
understanding the nature of jobs
under consideration.
 Job Analysis
It is the systematic collection and recording of
information concerning the purpose of a
job, its major duties, the condition under
which it is performed, the contacts with
others that the job requires, and the
knowledge, skill, and abilities needed to
perform the job effectively.
The results of job analysis are often used to
develop job descriptions and job
specifications.
 Job Description
 It is a statement of the duties, working
conditions, and other significant
requirements associated with a particular
job.
 Job descriptions are frequently combined
with job specifications.
 Job Specifications
 It is a statement of the skills, abilities,
education, and previous experience that
are required to perform a particular job.
 Demand for Human Resources
 A significant aspect of human resource
planning is assessing the demand for
human resources. Such an assessment
involves considering the major forces that
affect the demand and using basic
forecasting aids to predict it.
 Demand is only side of the equation
governing whether an organization will
have sufficient human resources to operate
effectively, the other side is the supply of
human resources.
 Supply of Human Resources
 In assessing the supply, human resource
managers consider both internal and
external labor supplies.
 Major means of assessing the internal labor
supply include skill inventories,
replacement planning, and succession
planning.
 Skill Inventories – is data bank (usually
computerized) containing basic information
about each employee that can be used to
assess the likely availability of individuals
for meeting current or future human
resource needs. It typically contains
information regarding employee’s
performance, knowledge, skills, experience,
interests, and relevant personal
characteristics.
 Replacement Planning – is a
means of identifying potential
candidates to fill specific managerial
positions.
 Succession Planning – is a means
of identifying individuals with high
potential and ensuring that they
receive appropriate training and job
assignments aimed at their long-run
growth and development. It provides
the organization with a well-qualified
pool of individuals from which middle
and top managers can be drawn in
the future.
 External Labor Supply
 Periodic estimates of labor supplies in a
variety of categories are made by
government agencies, including the
Department of Labor and Employment
(DOLE), the National Statistics Office
(NSO), and by industry and human
resource associations.
 We can rely on the above for external labor
supply.
 Reconciling Demand and Supply
 After estimating the demand and supply of
human resources, manager must often take
steps to balance the two.
 If the estimates show that the internal
supply of labor is too large, then managers
need to make plans to reduce the number
of employees through such measures as
resignation and retirement programs, or,
possibly layoffs.
 On the other hand, if additional
employees are necessary, then plans
must made for promoting and
transferring current organization
member, if desirable, as well as for
hiring new workers.
STAFFING
 It is the set of activities aimed at attracting
and selecting individuals for positions in a
way that will facilitate the achievement of
organizational goals.
 The goal of staffing is to obtain the best
available people for the organization and to
develop the skills and abilities of these
people.
 Associated with staffing is the recruitment
and selection of the right people for hiring.
 Recruitment
 It is the process of finding and attempting
to attract job candidates who are capable
of effectively filling-in job vacancies.
 Job description and job specifications are
important in the recruitment process
because they specify the nature of the job
and the qualifications required of job
candidates.
 Recruitment can be conducted both
internally and externally.
 External Recruitment – is the process of
finding potential external candidates and
encouraging them to apply for and/or be
willing to accept organizational jobs that
are open
 A variety of sources exist for obtaining
external job candidates.
 Advertising is generally the most heavily
used recruiting source.
 Other sources include college recruiting
program, employment agencies, and
referral by employees.
 One major issue related to external
recruiting is the tendency of recruiters and
managers to provide candidates with an
overly positive view or the organization in
order to attract new employees.
 An alternative approach is the realistic job
preview, a technique used during the
recruiting process in which the job
candidate is presented with a balanced
view of both the positive and the negative
aspects of the job and the organization.
 Recruiting is only one part of the
staffing process.
 Decisions must also be made about
the candidates to whom job offers will
be extended.
 Selection
 It is the process of determining which job
candidate best suit organizational needs.
 During this process, managers must
determine the extent to which job
candidates have the skills, abilities, and
knowledge required to perform effectively
in the positions for which they are being
considered.
 In order to make adequate
assessments of candidates, selection
method must have validity.
 It addresses how well a selection
device (such as test or interview)
actually predicts a candidate’s future
job performance.
Major Selection Methods
 Application blank – is a form of
containing a series of inquiries about an
applicant’s educational background,
previous job experiences, physical health,
and other information that may be useful in
assessing an individual’s ability to perform
a job.
 Selection interviews - is a relatively
formal, in-depth conversation for the
purpose of assessing a candidate’s
knowledge, skills, and abilities, as well as
providing information to the candidate
about the organization and potential jobs.
 Major Selection Methods
 Employment test – a means of assessing a job
applicant’s characteristics through paper-and-pencil
responses or simulated exercises. (Ability test, Personality
test, Performance or work sample test).
 Assessment center – is a controlled environment used to
predict the probable managerial success of individuals
mainly on the basis of evaluations of their behaviors in a
variety of simulated situations. The situations (or
exercises) are essentially performance tests that reflect the
type of work done in managerial positions.
 Reference checks – are attempts to obtain job-related
information about job applicants from individual who are
knowledgeable about the applicant’s qualification.
DEVELOPMENT AND
EVALUATION
 After individuals are hired, both they
and their employing organization will
ultimately gain from efforts aimed at
enhancing their knowledge, skills,
and abilities.
 Major approaches to increasing the
effectiveness of organization
members include training and
development as well as
performance appraisal.
 Training and Development
 It is a planned effort to facilitate employee
learning of job-related behaviors in order to
improve employee performance.
 Experts sometimes distinguish between the
terms “training” and “development”:
training denotes efforts to increase
employee skill on present jobs, while
development refers to effort oriented
toward improvements relevant to future
jobs.
 Phases of Training Process
 Assessment Phase – it involves identifying
training needs, setting training objectives, and
developing criteria against which to evaluate
results of the training program. A training
requirements are determined by conducting a
need analysis.
 Need Analysis – is an assessment of an
organization’s training needs that is developed
by considering overall organizational
requirement, tasks (identified through job
analysis) associated with jobs for which training
is needed, and the degree to which individuals
are able to perform those tasks effectively.
Phases of Training Process
 Training Design and Implementation Phase –
this involves determining training methods,
developing training materials, and actually
conducting the training.
 Evaluation Phase – it entails evaluating the results
of the training in terms of the criteria developed
during the assessment phase. Major ways to evaluate
training include measuring participant’s reactions to
training to determine how useful they thought it was,
assessing actual learning (perhaps through tests
before and after training), determining the extent of
behavioral change (possibly by having the supervisor
or subordinates of a trainee assess changes in the
individual’s behavior), and measuring actual results
on the job (such as increased output)
Types of Training Programs
 The most common types of training
programs are:
 Orientation training – is usually a formal
program designed to provide new employees
with information about the company and their
jobs.
 Technical and Skill training – is oriented
toward providing specialized knowledge and
developing facility in the use of methods,
processes, and techniques associated with a
particular discipline or trade.
 Management Development Program – focus
on developing managerial skill for use at the
supervisory, managerial, and executive level.
 Training can have a positive impact
on both productivity and employee
morale (as presented in the
situational example next slide).
Major Methods of Rating
Performance
 Because performance is multidimensional,
performance appraisal method must
consider various aspects of the job.
 The most widely used approaches on
employee behavior (behavior oriented –
attendance, appearance, dependability,
quality of work, and relationship with
people) or performance results (result
oriented –accomplishments).
COMPENSATION
 It consists of wages paid directly for time
worked, as well as more indirect benefits
that employees receive as part of their
employment relationship with the
organization.
 Wages paid for time worked are typically
payments made in cashable form that
reflect direct work-related remuneration
such as base pay, merit increases, or
bonuses.
 Benefits are forms of compensation beyond
wages for time worked, including various
protection plans (such as health insurance or
life insurance), services (such as an
organizational cafeteria or drug counseling),
pay for time not worked (such as vacations or
sick leave), and income supplements (such as
stock ownership plan).
 Benefits are considered a more indirect form
of compensation because they are generally
not as closely tied to the job and performance
issues or other forms of remuneration.
Types of Equity
 Most organizations attempt to
develop compensation systems that
carefully consider issues of equity, or
fairness.
 Equity issues are important because
individuals tend to compare their
relative inputs and outcomes with
those of others in assessing the
degree of equity treatment that they
receive.
Designing the Pay Structure
 Because of the complexity involved, many
organizations, particularly large ones, have
compensation specialists in the human
resource departments who oversee the
compensation systems development
process.
 At the foundation of most major
compensation systems is evaluation. Job
evaluation is a systematic process of
establishing the relative worth of jobs
within a single organization in order to
determine the equitable pay differentials
among jobs.
 Of course there are very many
approaches to designing pay
structures such as Point Factor
Method, Pay Survey, Broadbanding,
Skill-based Pay or Gainsharing
(Collective Bargaining Agreement).
Employee Benefit
 Benefits account for a growing
portion of total compensation. Some
of this benefits received by workers
are: Social Security, unemployment
compensation, or worker’s
compensation (in case of injury on
the job), Vacation or Sick leave,
Maternity or Paternity Leave,
Medicare, Rice Allowance, etc.
MAINTAINING EFFECTIVE
WORKFORCE RELATIONSHIPS
 Maintaining positive relations
between an organization and its
employees is an important aspect of
human resource management.
 Two areas of particular relevance are
labor-management relations and
employees’ rights.
Labor-Management Relations
 It is the process through which
employers and unions negotiate pay,
hours of work, and other conditions of
employment, sign a contract
governing such conditions for a
specific period of time, and share
responsibility for administering the
resulting contract.
 Unions are employee groups formed for
the purpose of negotiating with
management about conditions relating to
work. Some employee groups call
themselves associations rather than unions.
When recognized by the National Labor
Relations Commission (NLRC) unions have
the legal right to negotiate with employers
and help administer the resulting contract.
 A number of studies have addressed
why employees join unions. A main
factor is dissatisfaction with various
working conditions such as: wages,
job security, benefits, treatment by
supervisors, and prospects for
promotion.
Current Employee Issues
 Maintaining effective workforce
relationships requires that both human
resource professionals and line managers
stay abreast of and make appropriate
responses to issues affecting employees.
 Several areas of current concerns are the
shifting nature of psychological contract of
employment, sexual harassment, drug and
alcohol abuse, privacy rights, and family
issues.