Human Resource Management (HRM) Notes PDF

Topic 1 – Understanding People and Organisations INDIVIDUAL DIFFERENCES People differ significantly in how they respond to the same situation. These differences, along with environmental factors, shape behavior. Behavior = Person x Environment Consequences of individ...

Topic 1 – Understanding People and Organisations INDIVIDUAL DIFFERENCES People differ significantly in how they respond to the same situation. These differences, along with environmental factors, shape behavior. Behavior = Person x Environment Consequences of individual differences: o Productivity o Quality of work o Commitment o Empowerment o Leadership style o Self-esteem o Need for contact with other people PERSONALITY DIFFERENCES Personality: Persistent behavior patterns across situations; includes speech, appearance, creativity. Personality matters more than intelligence for job success. Personality Factors and Traits Emotional Stability, Extraversion. Openness to experience, Agreeableness. Conscientiousness. Self-monitoring behavior. Risk taking and thrill seeking. Narcissism and Optimism. Page 1 of 7 Topic 1 – Understanding People and Organisations Other Traits Relevant to Job Behavior: Self-monitoring: Adapts well vs. Inflexible Risk-taking: Thrill-seeking vs. cautious Optimism vs. Pessimism Narcissism: Self-absorbed, lacks empathy Personality–Job Fit Theory (Holland) Page 2 of 7 Topic 1 – Understanding People and Organisations Implications for Managers Consider intelligence and personality for: o Selection. Placement, Assignment and Training Key questions: o Is employees intelligent enough (but not overqualified)? o Is personality suitable (e.g., conscientious, open to learning)? ATTITUDES Attitudes = lasting thoughts, feelings, and behaviors toward objects or people. Components of Attitude: 1. Affective: How you feel. 2. Behavioral: How you act. 3. Cognitive: What you believe or think. Attitudes shape decisions and daily behavior. They can be changed with effort or new information. Importance in Workplace Attitudes impact work but can change from negative to positive. Benefits of developing a positive attitude in a professional setting: Responsibility boosts productivity. Teamwork improves with open-mindedness. Learning from mistakes keeps us motivated. Page 3 of 7 Topic 1 – Understanding People and Organisations Benefits of having a positive attitude at work: It helps deal with stress It will help you gain the respect of co-workers and your boss It motivates us to work hard It helps boost your self-esteem. It strengthens relationships in and out of work A positive mind attracts positive events It helps with constructive and creative thinking It makes us happy VALUE Values are what a person finds important and uses to guide actions. They reflect what someone believes is right, good, or desirable. Values influence how people behave at work. Job performance improves when personal and company values match. The Importance of Values Values shape our attitudes, motivation, and how we see others. We join organizations with ideas of what should or shouldn't happen. These ideas are based on our values and beliefs. Values affect how we think, feel, and act, often reducing objectivity. Types of Values (Rokeach Value Survey): 1. Terminal Values: Desired end goals (e.g., success, peace). 2. Instrumental Values: Preferred modes of behavior (e.g., honesty, responsibility). Page 4 of 7 Topic 1 – Understanding People and Organisations Implications for Managers Values influence behavior, attitudes, and performance. Employees work better when their values match the organization. Managers tend to support and reward those who fit in. Hiring should consider both skills and value alignment. PERCEPTION Perception = how individuals interpret the world and act on those interpretations. Behavior is based on perceived reality, not actual reality. Why Perceptions Matter: Help explain how people assign meaning to events. People don’t see reality – they interpret it based on experiences. Why We Study Perceptions To understand how people explain events. We see our own version of reality. Our behavior is based on how we interpret things. Factors that influence Perception: The Situation – Time, Work setting and Social Setting. The Target – Novelty, Motion, Sounds, Size, Background and Proximity. The perceiver – Attitudes, Motives, Interests, Experience and Expectations. Why People See Things Differently Perception varies due to the person, object, and situation. Page 5 of 7 Topic 1 – Understanding People and Organisations Perceptual Errors Prejudice: Disliking someone because of their group membership. Stereotyping: Judging someone based on group traits. Halo Effect: Forming an impression based on one characteristic. Selective Perception: Interpreting things based on personal interests and experiences. Projection: Attributing your traits to others. Implications for Managers Employees with positive job perceptions = more motivated and satisfied. Focus on: 1. Perceptual problems 2. How people assign causes (attributions) ATTRIBUTION THEORY Explains how people assign causes to behavior. Behavior can be due to internal (personality) or external (situation) factors. Three Factors of Attribution Theory 1. Distinctiveness: Is the behavior unusual? If yes, it's external; if not, it's internal. 2. Consensus: Do others behave the same? If yes, it's external; if not, it's internal. 3. Consistency: Is the behavior repeated? If yes, it's internal; if not, it's external. Page 6 of 7 Topic 1 – Understanding People and Organisations Managerial Implications Understanding attribution helps managers interpret and respond to employee behavior more accurately. Managers should avoid bias and consider situational factors. Page 7 of 7 Topic 2 – Understanding the Role of HRM Personnel Industrial Revolution & HR Factories and machines increased worker demand. To manage people in the factory system of the industrial revolution, three systems of HRM were developed in Recruitment of workers, Training for workers and Control of Workers. Workers were treated like servants under strict control. Trade Union Movement & HRM Unions formed to fight child labor, long hours, and bad conditions. Led to HR practices like: o Collective bargaining agreement o Handling complaints o Fair discipline o Better pay systems o Employee rewards programs Social Responsibility Period & HRM Early 1900s: Some owners cared more about workers’ well-being. Treated workers like family — a “father-child” style. Focused on workers’ physical, mental, and emotional health. Page 1 of 8 Topic 2 – Understanding the Role of HRM Personnel Scientific Management Period & HRM Introducing a more efficient way to manage work: o Time study – measuring job time o Motion study – removing useless movements o Standard tools and better work conditions Human Relation Period & HRM Psychology was used in hiring and training. Productivity depended on: o Workplace relationships o Group formation and group influence o Nature of leadership and supervision o Communication HR focused on people, not just the job. Evolution of HRM (1960s–2000s) Workers are seen as individuals with emotions and needs. HR improved training and pay with unions. Human capital = workers' knowledge and skills. Motivation theories are shaped like HR practices. Focus on matching jobs to people’s skills, goals, and interests. Page 2 of 8 Topic 2 – Understanding the Role of HRM Personnel HRM Today HR is now a key player in driving change and meeting internal and external demands. HR professionals need skills in data analysis, AI, digital tools, planning, design thinking, and treating HR like a product. People Management vs Human Capital vs HRM People Management: Managing employees day-to-day. Human Capital Management: Value of employees’ skills, knowledge, and experience. Personal Management: Concerned with obtaining, organizing and motivating the human resources required by the enterprise. Human Resource Management: Managing people to meet both personal and organizational goals. Introduction to Human Resource Management HRM is about hiring, training, rewarding, and ensuring the well-being of employees to achieve goals. It focuses on effective use of human talent. Page 3 of 8 Topic 2 – Understanding the Role of HRM Personnel Main Characteristics of HRM Action-Oriented: Solves people’s problems for better results. People-Oriented: Treats employees as individuals. Globally Oriented: Fairness and respect across cultures. Future-Oriented: Prepares talent for future needs. Human Capital and Human Resource Human Resource helps organizations succeed by building and managing a skilled, productive workforce. Human capital is the combined value of employees’ skills, knowledge, experience, and motivation that contribute to an organization’s success. Types of assets in organizations: 1. Physical (buildings, equipment) 2. Financial (cash, stocks) 3. Intangible (patents, tech) 4. Human (skills, experience) HRM in the Management Process HR helps plan, organize, lead, and control people-related strategies. Managers achieve goals through people. Why HRM Matters to Managers Avoid bad hires and legal issues. Improves results through motivated employees & managers may take on HR roles. Page 4 of 8 Topic 2 – Understanding the Role of HRM Personnel Human Resource Functions Human resource functions are the main tasks done to manage and support employees. They help run the organization smoothly and impact all parts of the business. 6 Major Functions of HRM: Human resource planning, recruitment, and selection. Human resource development Compensation and benefits Safety and health Employee and labor relations Human resource research Line vs Staff in HR All managers are HR managers in some way because they help hire, train, and manage employees. HR departments have dedicated managers for handling employee-related matters. Authority: The power to make decisions and give orders. Line Authority: Managers can give direct orders to staff (e.g., VP tells the sales director to prepare a report). Staff Authority: Managers can give advice but not direct orders (e.g., HR suggests using a certain test). Line Manager: Directs employees and ensures tasks are done. Staff Manager: Advises line managers and supports their work. Page 5 of 8 Topic 2 – Understanding the Role of HRM Personnel Line Managers’ HR Duties 1. Hire the right people 2. Onboard new hires 3. Train staff for jobs that are new to them 4. Boost performance of each person 5. Build teamwork 6. Explain rules 7. Manage costs 8. Growing employee skills 9. Keep morale high 10. Ensure health & safety HR Managers’ Duties Line Function (Line/Implied Authority): Direct HR team. Coordinative Function (Functional Authority): Align HR activities company wide. Staff Function (Staff Authority Innovator/Advocacy): Guideline managers on HR issues. Page 6 of 8 Topic 2 – Understanding the Role of HRM Personnel Trends Shaping HRM Competition: Lower costs, boost quality. Tech & social media: New hiring & training tools. Globalization: Diverse workforce, global standards. Work Trends: Focus on services and knowledge work. Economic Change: Adapt to slow growth, new challenges. Demographics: More women, older, and diverse workers. SHRM HR Manager Competencies 1. Leadership: Lead projects. 2. Ethics: Be honest and fair. 3. Business Know-How: Align HR with company goals. 4. Relationship Skills: Build good connections. 5. Consulting: Offer expert advice. 6. Critical Thinking: Make smart decisions. 7. Global Awareness: Respect all cultures. 8. Communication: Share ideas clearly. Page 7 of 8 Topic 2 – Understanding the Role of HRM Personnel SHRM HR Knowledge Areas 1. Hiring & retention 2. Employee engagement 3. Learning & growth 4. Pay & rewards 5. HR department structure 6. Org development 7. Workforce management 8. Employee relations 9. HR tech & data 10. Global HR 11. Diversity & inclusion 12. Risk management 13. Social responsibility 14. US labor laws 15. HR strategy Page 8 of 8 Topic 3 – Manpower Planning Manpower Definition Manpower planning is the process of ensuring the right number of people with the right skills are in the right jobs at the right time. Workforce / HR Planning It’s the process of making sure the organization has the right people with the right skills, in the right place and time, to meet its goals. Objectives of HR Planning (Simplified): Be ready for changes in culture and business trends Predict and prepare for job and skill changes Hire the right people on time Use the best methods to attract top talent Improve employees’ technical and soft skills Strengthening key HR processes like hiring, training, and rewards Use the HR budget wisely Importance of HR Planning (Simplified): Matches hiring with business needs Helps manage the gap between staff needed and available Avoids costly hiring and firing Reduces unexpected resignations Prepares the workforce for the future Supports planning for future leaders Page 1 of 6 Topic 3 – Manpower Planning Human Resource Planning Process Assess Current HR – Forecast HR Supply – Forecast HR Demand – Gap Analysis – Solutions Analysis. Human Resource Planning Process / Assess Current Human Resource Skills Inventory A system (manual or digital) that stores info about employees' skills, education, experience, and pay helps show what skills the company currently has. HR Audit A full review of the workforce to understand the current staffing situation compares past and present data to spot trends like turnover or training needs. Human Resource Planning Process Estimate how many and what types of employees will be available in the future either inside (internal) and outside (external) the organisation. Internal supply refers to job candidates that exist within the organisation. External supply is potential sources of human resources outside the organisation. Methods of Forecasting HR Supply Trend Analysis Uses past employee data (e.g. hiring, resignations, retirements) to predict future trends. Assumes that past patterns will continue. Example: If 5% retire, 6% resign, and 3% are dismissed yearly, expecting a 14% yearly reduction on staff. Page 2 of 6 Topic 3 – Manpower Planning Competency Model Competencies is a key knowledge, skills, and attitudes needed for a job. Matches required job skills with current employee abilities. Helps guide hiring, training, and development in important skill areas. Replacement Charts Shows expected job vacancies in higher positions. Identifies internal employees who can be promoted to fill those roles. Includes info like performance, readiness, and education of employees. Staffing Tables Shows all jobs and current employees in the organization. Helps understand staffing levels and types of staff across departments. Useful for evaluating staff combinations and workforce structure. Markov Analysis Predicts employee movement (promotions, transfers, exits) within the company. Tracks employee flow to forecast future HR supply. Page 3 of 6 Topic 3 – Manpower Planning Forecast HR Demand Estimates how many and what types of employees will be needed. Forecasting helps predict future staffing needs. Factors to Consider: Environmental scanning – Look at trends and external factors. Future goals and plans – Know what the company plans to do. Product/service demand – Estimate how much the company expects to sell. Workforce productivity – Check how efficient employees are. Job or organisation design – See if new roles or structures are needed. Budget availability – Know how much money is available for hiring. New products/services – Plan for launches that may need more staff. Ratio Analysis Use ratios (e.g., sales to employees) to predict future staff needs. Example: If a salesperson generates $500K in sales, more salespeople are needed for higher sales. Delphi Method Gathers expert opinions through questionnaires to predict future HR needs. Aims for consensus without face-to-face interaction. Page 4 of 6 Topic 3 – Manpower Planning Nominal Group Technique Experts meet to solve problems and propose solutions. Each expert gives their input, and the group selects the best options. Gap Analysis Compare HR demand and supply to spot differences Help in making HR plans to fix any gaps. 3 Possible Outcomes Scenario: Surplus – Too many employees Shortage – Not enough employees Equilibrium – Just the right number of employees. Solution Analysis: Labour Surplus Occurs when there are too many employees. Employers may respond with hiring freeze, attrition, job sharing, work sharing, reduced work week, layoff, termination with severance package and early retirement buyout programs. Solution Analysis: Labour Shortage Happens when there aren’t enough employees. Employers may respond with hiring full-time or temporary staff, delay employee retirements, re-hire retirees part-time, reduce employee turnover, use overtime and outsource work. Page 5 of 6 Topic 3 – Manpower Planning Solution Analysis: Labour Equilibrium When demand and supply of employees are balanced. Vacancies are filled through promotions, transfers, or external hiring. Page 6 of 6 Topic 4 – Designing Jobs for People Types of Jobs Jobs are the foundation of an organisation, structured to support productivity and goals. Through job design, roles gain tasks and rewards. Common types include traditional, evolving, flexible, idiosyncratic, team-based, and teleworking. 1. Traditional – Clear job description and chart. 2. Evolving – Changes with technology or employee input. 3. Flexible – Tasks and skills often change. 4. Idiosyncratic – Made for specific skilled individuals. 5. Team-based – Focused on teamwork and shared roles. 6. Telework – Work done remotely via technology. Job Terminology Job Family – Group by function (e.g. HR, Marketing). Job Category – Group by type (e.g. Clerical, Manager). Job – Group of similar positions. Position – Tasks done by one person. Task Dimension – Area of responsibility. Task – A grouping of elements to form an identifiable work activity. Element – Smallest unit of work which can be divided. Job Analysis Collects info on duties, skills, and worker traits. Important for: recruitment, selection, training, performance appraisal, compensation. Page 1 of 8 Topic 4 – Designing Jobs for People Job Requirements Approach to Job Analysis Relationship of Job Requirements to other HRM Functions Job Requirements: Recruitment – Determine recruitment qualifications. Selection – Provide job duties and job specifications for selection process. Performance Appraisals – Provide performance criteria for evaluating employees. Training and Development – Determine training needs and develop instructional programs. Compensation Management – Provide basis for determining employee’s rate of pay. How does a job analysis help facilitate a firm human resource effort Page 2 of 8 Topic 4 – Designing Jobs for People Types of information collected via job analysis Work activities, Human requirements, Job context, Performance standards, Human behaviors and Machines, tools, equipment and work aids. Use of Job Analysis Information Recruitment and selection, Equal Employment Opportunity Compliance, Discovering unassigned duties, Training, Compensation and Performance appraisal. Steps in doing a Job Analysis 1. Decide how you will use the information 2. Review relevant background information about the job chart 3. Select Representative Positions 4. Actually, analyze the job 5. Verify the job analysis information 6. Develop a job description and job specification Data Collection Methods Interview – Flexible but may be biased. Questionnaire – Fast for many workers, but costly. Observation – First-hand data, but time-consuming. Diaries/Logs – Detailed but relies on honest recall. Page 3 of 8 Topic 4 – Designing Jobs for People Methods for collecting Job Analysis Information Interview Information Sources – Individual employees, Groups of employees and Supervisors with knowledge of the job. Interview Formats – Structured (checklist) and Unstructured. Advantage – Quick, direct way to find overlooked information. Disadvantage – Distortion of information. Methods for collecting Job Analysis Information Questionnaire Information Sources – Have employees fill out questionnaires to describe their job duties. Questionnaire Formats – Structured Checklist and open-ended questions. Advantage – Quick and efficient way to gather information from large numbers of employees. Disadvantage – Expense and time consumed in preparing and testing the questionnaire. Methods for collecting job analysis information (observation) Information Sources – Managers watch employees do their job. Advantages – Real, first-hand information and less bias. Disadvantages – Time-consuming, may affect behavior, hard to observe full job or mental tasks. Methods for collecting job analysis information (Participant diaries/logs) Information Sources – Employees record what they do, and time spent Advantages – Detailed view of the job, involves employees. Disadvantages – Info may be inaccurate and relies on memory. Page 4 of 8 Topic 4 – Designing Jobs for People Job Description Identify the tasks, duties and responsibilities of a job. Sections of a Typical Job Description: Job Identification, Job Specifications, Working Conditions, Standards of performance, Authority of the incumbent, Responsibilities and duties and Job summary. A job description explains what a job involves. It includes: Job ID: Title, date, who prepared it Job Summary: What the job is about Relationships: Who you report to, supervise, and work with Duties: Main tasks, decisions, supervision, and budget limits Standards & Conditions: What’s needed to succeed in the job Disclaimer: Employer can change tasks; includes "other duties as assigned" clause. Job Specification Lists KSAs (Knowledge, Skills, Abilities) needed. Based on what’s needed for the job (not the current employee). The minimal acceptable qualifications incumbents must process to successfully perform the essential elements of their jobs: Knowledge & education Skills, experience and abilities Certifications Page 5 of 8 Topic 4 – Designing Jobs for People Competency-Based Analysis Focuses on the skills, knowledge, and behaviors needed to do a job well. Competencies are traits that help someone perform effectively. Why use it? Supports high performance and helps create clear, strategic job descriptions. Also, Aids in measuring and rewarding general, leadership, and technical skills. Job Design / Redesign Design – How work is structured and assigned. Redesign – Modify current job duties/processes. Goals: Match org needs + employee needs. Improve job performance, satisfaction, development, and health. The impacts of Job Design Job Performance, Job Satisfaction, Employee Engagement, Physical and Mental Health, Employee Development and Turnover/absenteeism. Job Design Techniques 1. Job Enlargement – Add variety. 2. Job Enrichment – Add meaningful tasks. 3. Job Rotation – Switch jobs for variety. 4. Job Simplification – Break into simpler tasks. Page 6 of 8 Topic 4 – Designing Jobs for People Flexible Work Schedules Let employees choose when and where they work. Help with motivation, loyalty and keeping employees. It is useful when companies can’t offer high pay or full benefits. Gives workers more control over their job. Examples of Flexible Work Schedules 1. Flextime – Choose start/end times around core hours. 2. Telecommuting – Work from home using tech. 3. Job Sharing – Two people share one job. 4. Compressed Workweek – Fewer days, longer hours. Advantages and Disadvantages of Flexible Scheduling Page 7 of 8 Topic 4 – Designing Jobs for People Benefits of Flexible Work Family & Personal Time – Easier to handle personal needs like doctor visits or emergencies. Less Commuting – Saves time and money by working from home. More Control – Employees choose when, where, and how to work. Higher Morale – Happier, more productive employees. Fewer Absences – Flexibility helps avoid being late or missing work. Lower Turnover – Employees stay longer because they value flexibility. Job Satisfaction – Makes workers more satisfied and efficient. Page 8 of 8 Topic 5 – Selecting and Recruiting Personnel (Recruitment and Selection) RECRUITMENT Relationships among Job Analysis, Human Resource Planning, Recruitment and Selection. Recruitment & Selection Recruitment is about finding and attracting good candidates. The selection is about choosing the one who will best help the company now and in the future. Recruitment & Selection Process (Steps): 1. Identify job openings through planning. 2. Find candidates from inside or outside the company. 3. Get applications and do first interviews. 4. Screen candidates using tests or background checks. 5. Choose the best person after final interviews. Steps in Recruitment and Selection Process Page 1 of 12 Topic 5 – Selecting and Recruiting Personnel (Recruitment and Selection) Effective Recruiting Recruiting is about finding and attracting people for job openings. Good recruiting brings in enough qualified and diverse candidates. It includes job fairs, online ads, college visits and networking. Internal Factors Consistency of the firm’s recruitment efforts with its strategic goals. The available resources, types of jobs to be recruited and choice of recruiting methods. Non-recruitment HR issues and policies. Line and staff coordination and cooperation. External Factors Looming undersupply of workers Lessening of trend in outsourcing of jobs Increasingly fewer qualified candidates Improving the Effectiveness of Recruiting Know the exact skills needed (job analysis) Involve managers & staff in hiring. Set a clear start date that suits both sides. Review the process to improve after hiring to learn and improve. Recruiters – Recruiters should be well-trained in communication, the hiring process. Company details and legal rules. Recruitment sourcing - Choose the right recruitment methods for each job. Developing the “Employer Brand” – Employers use marketing to attract candidates by showing what it’s like to work at the company including its values and work environment. Page 2 of 12 Topic 5 – Selecting and Recruiting Personnel (Recruitment and Selection) Internal Sources of Candidates Promotions or transfers from current staff. Saves time and cost. Boosts employee morale and retention. 1. Internal Job Postings – informing current employees about available positions. 2. Transfers – Moving employees to different departments/roles. 3. Promotions – Promoting deserving employees from lower-levels. 4. Employee Referrals – Current employees recommend potential candidates. External Sources of Candidates Used when: Internal supply is limited. The company is growing or needs new skills. Main sources: 1. Advertisements: TV, newspapers, online. 2. Internet: Company website, job boards. 3. Employment Agencies: Public or private. 4. Temporary & Contract Workers: Short-term hires. 5. Outsourcing & Offshoring: Work done by external or overseas companies. 6. College Recruiting: Fresh graduates, internships. 7. Executive Recruiters ("Headhunters"): For high-level positions. 8. Referrals & Walk-ins: Employee referrals or direct applicants. 9. Job Fairs: Events to meet potential candidates. Page 3 of 12 Topic 5 – Selecting and Recruiting Personnel (Recruitment and Selection) Advantages and Disadvantages of Internal and External Recruiting Sources Comparison of Sources There is usually a choice between different methods or combinations of them. The criteria to use when making the choice are: 1. The likelihood that it will produce good candidates. 2. The speed with which the choice enables recruitment to be completed. 3. Consider costs, including ads and consultant fees. Page 4 of 12 Topic 5 – Selecting and Recruiting Personnel (Recruitment and Selection) Recruitment Challenges Delays in Hiring Too few or too many candidates Bias in the Hiring process Difficulty in assessing Complexities in pay negotiation Stringent Hiring Compliance policies. Recruitment Alternatives Outsourcing: Hire an outside company to do certain tasks. Independent Contractors: Hired for specific tasks, work on their own. Contingent Workers: Temporary or on-call staff. Employee Leasing: Workers hired through another company. Overtime: Let current staff work extra hours. Page 5 of 12 Topic 5 – Selecting and Recruiting Personnel (Recruitment and Selection) SELECTION Employee Selection SHRM: Selection means screening candidates to hire the most qualified ones. Gatewood, Feild & Barrick: It's choosing the best-fit person based on skills, knowledge, and abilities. Milkovich & Newman: It’s about collecting info on candidates to make the best hiring decision. Goals of Selection It Maximize "hits" and avoid "misses." Hits: Accurate predictions (successful hires). Misses: Hiring someone who doesn’t perform well (costly). Not hiring someone who could have excelled (opportunity cost). Perspective on Selection "Hire hard, manage easy": Spending time selecting the right people makes managing them easier later. "Good training can't fix bad selection": If the wrong people are hired, training won't be enough to make them successful. The Importance of Effective Employees Selection Improves employee and company performance. Reduces hiring/training costs and workplace issues. Legal Implications and Negligent Hiring Hiring and training costs Employee and organization’s performance is at stake. Page 6 of 12 Topic 5 – Selecting and Recruiting Personnel (Recruitment and Selection) Selection Criteria, Predictors and Performance Effective selection of employees involves using criteria and predictors of job performance. Selection Criteria: Traits needed to succeed in a job. Predictors: Measurable signs of those traits (e.g. test scores, experience). Selection Process Before selection: Job analysis, HR planning, and recruitment must happen first. Main goal: Choose the best person from the qualified candidates. Purpose: Ensure a good match between person and job/organisation. Person-job fit: Match the applicant’s skills (KSAOs) with job requirements. Person-organisation fit: Match the person’s values with the organisation’s culture. Page 7 of 12 Topic 5 – Selecting and Recruiting Personnel (Recruitment and Selection) Selection Process (8 Steps) 1. Initial Screening – Quick check of qualifications and phone interviews. 2. Application Form – Collects contact info, education, and work history. 3. Pre-employment Tests – Tests for KSAOs (skills, personality, etc.). 4. Comprehensive Interview – Assess motivation, values, attitude, culture fit. 5. Conditional Job Offer – Tentative offer if next steps are passed. 6. Background Check – Verify references, education, criminal record, etc. 7. Medical/Physical Exam – Check fitness for the job (also includes drug test). 8. Permanent Job Offer – Final hiring decision and formal offer. Selection Process Step 1 – Initial Screening of Candidates (i) Screening inquiries: Check qualifications (skills, experience, education) based on the job description. (ii) Screening interviews: Usually by phone; explains the job and checks basic communication and experience. Step 2 – Completing the Application Form Collects basic info (contact, education, skills, experience). Can be online or paper format. Includes other job-related details needed for selection. Step 3 – Pre-employment Tests Tests measure KSAOs (knowledge, skills, abilities, etc.) objectively. Performance tests: Show real job tasks to test abilities. Work sampling: Applicants perform small parts of the job. Assessment centres: Group/individual tasks to test management skills, judged by trained staff. Page 8 of 12 Topic 5 – Selecting and Recruiting Personnel (Recruitment and Selection) Basic of Testing and Selecting Employee Any test or screening tool has TWO important characteristics: 1. Test Reliability: Test gives consistent results over time. 2. Test Validity: Test accurately measures what it's supposed to. Types of Test Validity: Construct validity: Measures and traits needed for the job. Criterion validity: High test scores match good job performance. Content validity: Test reflects actual job tasks. What Different Tests Measure: Cognitive abilities: Thinking, problem-solving, memory. Motor/physical abilities: Strength, coordination, physical skills. Personality/interests: Traits and preferences. Achievement: What a person has learned or accomplished. Types of Tests Cognitive Ability: Intelligence, reasoning, memory. Motor & Physical: Dexterity, strength, stamina. Personality: Traits like extroversion, stability, motivation. Achievement Tests: What a person has learned (e.g. school subjects). Performance Simulations: o Work Sample – Do a small part of the job. o Assessment Centres – Group exercises for manager roles. Page 9 of 12 Topic 5 – Selecting and Recruiting Personnel (Recruitment and Selection) Selection Process Comprehensive Interview A process where a candidate answers questions to give more info beyond forms or tests. Helps assess motivation, attitude, pressure handling, and cultural fit. Interviews can be classified by: 1. Structure – How planned or formal it is. 2. Content – What topics are covered. 3. Method – How the interview is conducted (e.g., face-to-face, panel, etc.). Selection Interview Structure: Unstructured: Open-ended questions; candidate leads the talk. Structured: Fixed questions with set answers. Content: Situational: "What would you do if...?" (hypothetical situations). Behavioral: "What did you do when...?" (past actions). Knowledge/Background: Ask about skills, experience, and job knowledge. Method: One-on-one: One interviewer. Sequential: Several interviews, one after another. Panel: A group of interviewers question one candidate. Phone/Video: Done remotely via call or video. Computerized: Questions asked by a computer. Page 10 of 12 Topic 5 – Selecting and Recruiting Personnel (Recruitment and Selection) Selection Process Step 5 – Conditional Job Offer A temporary job offer is given after passing earlier steps. Becomes final if conditions (e.g. background check, drug test) are met. Step 6 – Background Check Verifies applicant’s info (education, work history, etc.). Applicant must sign a waiver for checks. Sources: references, past jobs, education, credit, court records. Step 7 – Medical/Physical Exam Check if the applicant is physically fit for the job. May affect health insurance eligibility. Must be job-related. Drug tests are also included. Step 8 – Permanent Job Offer Given to candidates who pass all steps. Final decision often lies with the applicant. The offer may be sent by email or letter. Selection Process Criteria Development Know the needed KSAOs (skills, traits). Decide how to measure them (tests, interviews). Create a scoring system. Plan the interview process. Application & Resume Review Review based on set criteria. Check both internal and external candidates. Page 11 of 12 Topic 5 – Selecting and Recruiting Personnel (Recruitment and Selection) Interview Choose interview types. Prepare questions. Watch out for bias. Administration Test Run tests (e.g. work samples, drug, cognitive, personality) as planned. Selection Pick the best selection method. Compare candidates using your criteria. Making the Offer Use negotiation if needed. Write and send the job offer letter. Page 12 of 12 Topic 6 – Training and Development Employee Orientation Gives new hires basic info about the company and their job. Help them feel welcome and adjust to the workplace. Purpose of Orientation Orientation Helps New Employees Make employees feel at ease. Understand the organisation. Know job expectations. Start the socialization process. Page 1 of 6 Topic 6 – Training and Development Orientation Process Orientation Programmes Organizational Orientation: General info relevant to all employees. Departmental/Job Orientation: Specific info about the employee's department and role. Onboarding / Socialisation Process of helping new hires adapt to company values and culture. A process in which new employees move from being outsiders into insiders. Page 2 of 6 Topic 6 – Training and Development Training Teaches employees job-related knowledge, skills, and behavior. Goal: Apply what’s learned to real job tasks. Types: Employee Training: For current jobs (present-focused). Employee Development: For future roles and growth. Skill Types: Hard Skills: Teachable like IT, machinery, budgeting. Soft Skills: Communication, leadership, teamwork. Page 3 of 6 Topic 6 – Training and Development Training Process – ADDIE Model 1. Analysis – Find training needs 2. Design – Plan the training 3. Develop – Create training materials 4. Implement – Deliver training 5. Evaluate – Check if training was effective Employee Training Methods On-the-job Training – Trainee works with more experienced employee in the actual work environment. Job Rotation – Moving employees horizontally or vertically to expand their skills, knowledge or abilities. Apprenticeships – Combine instruction with coaching from an experienced mentor. Internships – Structured program for students to gain employment experience in their area of study. Classroom Lectures – Training in a traditional classroom setting. E-learning – Uses computer technology to deliver a variety of training methods. Simulation – Any artificial environment that attempts to closely mirror an actual condition. Page 4 of 6 Topic 6 – Training and Development Employee Development Employee development focuses on personal growth to benefit the organization. Aims to improve skills like critical thinking and problem-solving. Includes training opportunities to enhance current and future job roles. Seen as a strategic tool for organizational growth, attracting, and retaining talent. Benefits of Employee Development Staying Competitive: Keeps employees’ skills up to date. Dealing with Skills Shortages: Upskilling/reskilling for new job opportunities. Promoting Diversity: Helps women and minorities move up. Learning Culture: Encourages adaptability and learning. Reduces Turnover: Training reduces turnover and absenteeism. Aligning with Organizational Needs: Development meets strategic goals. Page 5 of 6 Topic 6 – Training and Development Effective Employee Development Integrates with succession planning. Identifies and develops leadership to improve performance. Employee Development Methods 1. Coaching: Personalized guidance for skill improvement. 2. Mentoring: Matches experienced employees with newer ones to improve performance. 3. Individual Development Plans (IDP): Custom plans for growth. 4. 9-Box Grid: Evaluates current and potential contribution. 5. Cross-Training: Training employees to perform different jobs. 6. Stretch Assignments: Assignments outside comfort zones to develop skills. 7. Job Enlargement: Adds more tasks at the same level. 8. Job Enrichment: Increases responsibility and control in the role. 9. Job Shadowing: Observing employees in other departments. 10. Job Rotation: Moving employees through different roles. Employee Development Challenges Lack of accountability. Gaps in talent development capabilities. Inconsistent execution. Limited use of meaningful analytics. Costs and benefits of current development methods. Determine what is essential. Lack of alignment between human capital and business strategy. Page 6 of 6 Topic 7 – Appraising People at Work Understanding Performance Performance is the degree to which an employee accomplishes job tasks. It is based on results, not effort. For example, a student may exert a great deal of effort in preparing for an examination and still make a poor grade. In such a case the effort expended was high, yet the performance was low. Determinants of Performance Job performance is the net effect of an employee’s effort as modified by abilities and role (or task) perceptions. Performance can be viewed as resulting from the interrelationships among effort, abilities, and role perceptions. Effort: Energy used (mental or physical). Abilities: Skills and personal characteristics. Role perceptions: Understanding what tasks are expected. Performance Appraisal vs. Performance Management Performance Appraisal: Setting standards, assessing performance, providing feedback. Performance Management: Broader strategy aligning employee performance with organizational goals. Page 1 of 9 Topic 7 – Appraising People at Work Importance of Performance Appraisals Basis for pay, promotion, and retention decisions Why Appraise Performance? Basis for pay, promotion, and retention decisions Play a central role in the employer’s performance management process Help in correcting deficiencies and reinforcing good performance Provide an opportunity to review the employee’s career plans Identify training and development needs (i.e. performance analysis Page 2 of 9 Topic 7 – Appraising People at Work Responsibilities of the Human Resource Department in Performance Appraisal Design the appraisal system. Train managers in conducting performance appraisals. Ensure timely appraisals. Maintain appraisal records. Managers Evaluate the performance of employees. Complete appraisal forms are used in appraising employees and return them to HR department. Discuss appraisals with employees. Set plans for improvement with employees Page 3 of 9 Topic 7 – Appraising People at Work Performance Appraisal Process 1. Establish Performance Standards: Based on job analysis and strategic goals. 2. Communicate Expectations: Make sure employees understand standards. 3. Measure Actual Performance: Use observations, reports, and data. 4. Compare Performance to Standards: Identify gaps. 5. Discuss Appraisal with Employee: Provide feedback and maintain motivation. 6. Initiate Corrective Action: o Immediate: Fix symptoms quickly. o Basic: Address root causes through training or development. Performance Appraisal Process (Simplified Notes) 1. Set Standards o Create clear, measurable goals based on job roles and company strategy. 2. Communicate Expectations o Let employees know what is expected and how they'll be assessed. Page 4 of 9 Topic 7 – Appraising People at Work 3. Measure Actual Performance o Expectations and standards should be communicated to employees. o Four common sources of information: personal observation, statistical reports, oral reports and written reports. 4. Compare Actual Performance with Standards o Identify gaps between actual results and the set standards. 5. Discuss the Appraisal with the Employee o Share feedback; how it's delivered affects motivation and self-esteem. 6. Take Corrective Action (if needed) o Immediate: Fix quick issues (e.g., mistakes, poor training). o Basic: Solve deeper causes (e.g., provide coaching, training). Who Conducts Appraisals Page 5 of 9 Topic 7 – Appraising People at Work Who Does the Appraising 1. Manager/Supervisor o Done by the employee’s direct manager; sometimes reviewed by higher management. 2. Self-Evaluation o Employee rates their own performance before the appraisal meeting. 3. Customer Evaluation o Feedback from internal and external customers. 4. Subordinate Evaluation o Employees evaluate their managers; used mainly for development. 5. Peer Evaluation o Colleagues provide feedback, usually combined into a group summary. 6. Team Evaluation o Focus on the performance of the whole team, not individuals Page 6 of 9 Topic 7 – Appraising People at Work Appraisal Methods A. Absolute Standards Critical Incident: Evaluate based on key behaviors. Checklist: Rater checks off attributes. Graphic Rating Scale: Rate specific traits on a scale. Forced Choice: Choose between paired statements. BARS (Behaviorally Anchored Rating Scales): Rate based on specific behavioral examples. B. Relative Standards Group-Order Ranking: Employees placed into performance categories. Individual Ranking: Employees ranked from best to worst. Paired Comparison: Compare employees in pairs. C. Outcome-Based (Management by Objectives - MBO) Employees evaluated the achievement of specific, measurable objectives. Converts organizational goals into individual objectives. Factors That Distort Appraisals Leniency Error: Rater is too generous. Halo Error: One positive trait affects all ratings. Similarity Error: Rater favors those similar to themselves. Low Appraiser Motivation: Avoids giving poor ratings. Central Tendency: Avoids using high or low ratings. Inflationary Pressures: Unjustifiably high ratings. Page 7 of 9 Topic 7 – Appraising People at Work Inappropriate Substitutes: Using proxies instead of actual performance. Effective Appraisal Interviews Show how the employee’s role contributes to the organization. Be honest and constructive. Emphasize strengths. Ensure access to necessary tools and resources. Encourage employee participation. Align appraisal with career goals. Make outcomes feel fair and justified. Page 8 of 9 Topic 7 – Appraising People at Work Suggestions for Effective Evaluation Interviews: Steps and Skills Effective Performance Management Effective Performance Management Supports employee development. Useful for administrative decisions. Legally sound and job-related. Perceived as fair by employees. Documents performance effectively. Page 9 of 9 Topic 8 – Establishing Pay and Compensation Plans Total Rewards A broad view of all rewards is used to attract, retain, and motivate employees. Includes monetary (pay, bonuses) and non-monetary (training, work-life balance, culture, growth opportunities) rewards. Classification of Rewards Intrinsic Rewards: Internal satisfaction (e.g., pride, accomplishment). Extrinsic Rewards: Given by others (e.g., pay, benefits). Financial Rewards: Direct monetary compensation. Non-Financial Rewards: Perks that don’t increase pay (e.g., flexible hours). Performance-Based Rewards: Based on individual results. Membership-Based Rewards: Given regardless of performance (e.g., health benefits). Pay vs. Compensation Pay: The money employees receive. Compensation: All extrinsic rewards (money, benefits, perks). Compensation Administration Designing fair, competitive, and cost-effective pay structures. Aims to attract, retain, and motivate employees. Based on job evaluation to ensure internal fairness. Page 1 of 3 Topic 8 – Establishing Pay and Compensation Plans Job Evaluation Process of determining the value of jobs to set fair pay. Help maintain internal equity. A job’s value can be compared tp other jobs in the company or to a set scale. The job ranking helps decide where it fits in the overall pay structure. Three Main Methods: 1. Ranking: Rank jobs by difficulty or value (simple but subjective). 2. Classification: Group jobs into classes/grades based on rules and skills. 3. Point Method: Assign points based on compensable factors like skill, responsibility, and effort. Pay Structure Components a. Compensation Survey Compare pay practices with other organizations to maintain external equity. Helps adjust wages and correct employee misconceptions. b. Wage Curve Graph showing the relationship between job value (points) and pay rate. Useful for aligning internal and market rates. c. Wage Structure Pay grades and ranges for similar jobs. It reflects performance, experience, and job similarity. Includes minimum, midpoint, and maximum for each grade. Page 2 of 3 Topic 8 – Establishing Pay and Compensation Plans 7. Incentive Plans For Individual Employees Straight Piecework: Pay per item made/sold. Standard Hour Plan: Bonus for exceeding standard output/time. Bonus: Extra pay for achievements. Merit Pay: Pay increase based on performance. Recognition Awards: For contributions and achievements. For Salespeople Straight Salary: Fixed pay. Straight Commission: Based on sales only. Combined Salary + Commission: Mix of both. Salary + Bonus: Bonus for reaching sales targets. For Managers/Executives Short-Term Incentives: For goals within 1 year. Strategic Long-Term Incentives: For long-term organizational goals. 8. Team and Organization-Wide Incentives Profit Sharing: Employees share company profits. Scanlon Plan: Bonus based on cost savings (usually labor). Earnings-at-Risk Plan: Part of pay depends on meeting goals. Employee Stock Ownership Plan (ESOP): Stock bonuses given to employees via trust. Page 3 of 3 Topic 9 – Ethics, Justice and Fair Treatment in HRM What is Ethics? Ethics: Principles guiding right and wrong conduct. The standards you use to decide what your conduct should be. Ethical behavior depends on a person’s values and perspective. Ethics and Fair Treatment at Work Normative judgements – Judging something as good or bad, right or wrong, better or worse. Moral Standards – Morality is society’s highest accepted standards of behaviour. Distributive Justice – Refers to the fairness and justice of the decisions result. Procedural Justice – Refers to the fairness of the process. What Shapes Ethical Behavior at Work Individual Characteristics Organizational Culture Pressure from Boss Ethics Policies & Code Organizational Pressure Page 1 of 4 Topic 9 – Ethics, Justice and Fair Treatment in HRM Methods to Promote Ethics and Fair Treatment a. Selection Use recruitment materials that stress ethics. Conduct background checks and honesty tests. Ask ethical scenario questions during interviews. b. Ethics Training Teach employees how to handle ethical dilemmas using codes of conduct. c. Performance Appraisal Ensure appraisals are fair, clear, and transparent. d. Rewards and Discipline Reward ethical behavior, penalize unethical actions. 4. Discipline Purpose: Encourage rule-following behavior. Used when rules or policies are broken. Fair Discipline Process: Clear rules and regulations. A system of progressive penalties. An appeals procedure. Discipline without punishment. Page 2 of 4 Topic 9 – Ethics, Justice and Fair Treatment in HRM Managing Dismissals Dismissal – Involuntary termination of an employee’s employment with the firm. Termination at will – Either party can end employment unless a contract says otherwise. Wrongful Discharge – Happens when dismissal breaks a law or contract (explicit or implied). Types Grounds of Dismissal: Unsatisfactory Performance: Fails to meet job standards. Misconduct: Violation of rules (e.g., theft, dishonesty). Lack of Qualifications: Unable to do the job. Job Requirement Change: Job eliminated or significantly changed. Insubordination: Willful refusal to follow orders. 6. Fairness in Dismissal Explain the reason clearly. Use a step-by-step process with warnings and neutral appeals. Ensure the right person handles the termination. Security Measures - “Measures range from simply disabling access and changing passwords to reconfiguring the network and changing IP addresses, remote access procedures, and telephone numbers” Wrongful Discharge Wrongful discharge (or termination) occurs when an employee’s dismissal does not comply with the law or with the contractual arrangement stated or implied by the employer Page 3 of 4 Topic 9 – Ethics, Justice and Fair Treatment in HRM Avoiding Wrongful Discharge Suits Use clear and fair employment policies. Document all procedures. Communicate job expectations clearly. Termination Interview Meeting where the employee is officially told about dismissal. Guidelines: 1. Prepare the meeting in advance. 2. Be clear and direct. 3. Explain the reason. 4. Allow the employee to respond. 5. Review severance details. 6. Outline the next steps. 9. Exit Interview Conducted with an employee leaving voluntarily. Purpose: Gather feedback to improve the workplace. Page 4 of 4