Introduction to Human Resource Management PDF

Learning Objectives: After completing this module, you should be able to: LO1. Define human resource management; LO2. Identify the best features of human resource management; LO3. Identify and discuss the human resource management functions; LO4. Explain how human re...

Learning Objectives: After completing this module, you should be able to: LO1. Define human resource management; LO2. Identify the best features of human resource management; LO3. Identify and discuss the human resource management functions; LO4. Explain how human resource management impacts on organizational success; LO5. Demonstrate understanding of the employment cycle; LO6. Define strategic human resource management; LO7. Explain how human resource management serves as a strategic business partner; LO8. Explain the shared responsibility and strategic alignment in HRM; LO9. Determine the current trends in human resource management; and LO10. Identify the skills needed to effectively handle the HRM functions of an organization. WHAT IS HUMAN RESOURCE MANAGEMENT? HUMAN RESOURCE MANAGEMENT (HRM)  The process of ensuring that an organization is able to attract, utilize, and maintain a workforce with the right knowledge, skills, attitudes, and behavior to achieve organizational objectives. The process is enabled by organizational policies, practices, and systems. (Supangco et al., 2021)  The process of acquiring, training, appraising, and compensating employees, and of attending to their labor relations, health and safety, and fairness concerns. (Dressler 2020)  The use of individuals to achieve organizational objectives. (Martocchio 2019) WHY STUDY HUMAN RESOURCE MANAGEMENT? Many of you plan to seek a career in HRM; others do not. Even if you don’t, HRM is everyone’s business. According to Martocchio (2019), here are two things to consider why you should care about HRM regardless of whether you plan to work in accounting, finance, marketing, operations, or even start your own business: 1. Understanding HRM will give you a solid foundation for understanding your rights and responsibilities as an employee. 2. At some point in the future, you may have the opportunity to supervise employees or lead a department. When you do, you will need to have the most qualified employees on your team; and you will want to ensure that you are achieving exemplary performance by providing regular feedback and rewarding excellence. Basically, the success in your career will not only depend on your expertise, but also on having good employees. Similarly, Dressler (2020) emphasized that HRM is important to all managers in order to: 1. Avoid personnel mistakes 2. Improve profits and performance 3. Anticipate the possibility of taking the HR manager role 4. Take the HR role as the owner or manager of a small business. BEST FEATURES OF HUMAN RESOURCE MANAGEMENT Human resource management is a continuing process of managing people and their activities at work while squeezing out the best potential from them so they become productive individuals. Hence, HRM is: Table 1.1 Best Features of Human Resource Management (Lauron 2019) HRM is present and performed in all operational and functional 1. Prevalent in nature areas of management within the organization on a continuous basis. HRM constantly finds ways to change situations and events for the 2. Dynamic betterment of the organization and employees and not merely focused and dependent on written rules or policies. HRM works towards getting the best out of each employee by 3. Individually-oriented seeing to it that they are continuously offered the opportunity to be equipped with new knowledge and skills. Employees are the primary contributors to an organization's success. Rewarding them for their hard work encourages them to 4. Employee-oriented continue performing well. By treating employees fairly and valuing their contributions, companies can create a positive work environment that motivates employees to excel. Effective workforce planning is essential for organizational success. By accurately forecasting labor requirements, HR functions can 5. Forward-looking ensure the availability of qualified personnel to meet strategic objectives. To achieve success, organizations must continuously invest in their employees' skills and knowledge. This requires a well-structured 6. Growth-oriented. employee development program to foster growth and innovation. One effective strategy is job rotation, which allows employees to gain diverse experience and enhance their skill set. HUMAN RESOURCE MANAGEMENT FUNCTIONS Table 1.2 JOB-BASED FUNCTIONS Identifies the general ways of how work will be done by defining the a. JOB DESIGN specific tasks to be performed Examines the tasks and responsibilities involved in undertaking a job, b. JOB ANALYSIS the relationship of the job to other jobs, and the environment in which the job is done. Estimates human resource needs in terms of number and type of c. HUMAN RESOURCE individuals required to achieve the objectives of the organization, PLANNING and the necessary actions to ensure that the right individuals are available when needed. d. RECRUITMENT Attracts qualified applicants to join the organization. e. SELECTION Appoints the best talent who fits the organization and a target role. Aligns organizational and employee expected behaviors and f. PERFORMANCE outcomes, evaluates performance against these expectations, and MANAGEMENT provides appropriate actions.  Entails a planned intervention providing knowledge and skills to g. TRAINING prepare an employee or group for an immediate or current need. Consists of planned interventions focused on enabling long-term h. DEVELOPMENT growth of the employee, teams, and the organization. The total reward, financial or otherwise, an employee gets in i. COMPENSATION exchange for one’s services rendered to the organization. A component of the total reward received by an employee. Unlike salaries and wages, benefits are part of the financial compensation j. BENEFITS given to employees by virtue of one’s membership in an organization and not because of the amount of work rendered. Table 1.3 ORGANIZATION-BASED FUNCTIONS Focus on providing a work environment that adheres to safety a. HEALTH and SAFETY standards, and promotes employees’ physical, psychological, and social health and well-being. Ensure that a positive employer-employee relationship is b. EMPLOYEE RELATIONS maintained to enhance performance and satisfaction. Pertain to the relationship between the employer and the c. LABOR RELATIONS representatives of employees. The process of keeping employees in the organization and d. EMPLOYEE RETENTION minimizing the magnitude and effect of employee separation. Figure 1.1 Human Resource Management Functions (Supangco et al., 2021)  HUMAN RESOURCE DATA ANALYTICS: Using Numbers to Improve People - HR data analytics is about using numbers to understand and improve how people work. It’s a new tool that’s helping HR departments become more valuable to businesses. - Although human resource data analytics is not a traditional HRM function, it pervades all functional areas. Analyzing employment data (e.g. employment productivity) and business outcomes (e.g. profits) has empowered HR professionals to quantify its influence. - 51% of companies correlated business outcomes with business programs, which is up from 38% in just one year earlier (Global Human Capital Trends 2016). Data analytics go a long way toward establishing the HRM function as a strategic business partner.  - By analyzing data on employees, like how productive they are, and how the company is doing in terms of profits, HR can show how it impacts the business. This is making HR more of a trusted partner in decision-making. - Instead of just looking at data inside the company, HR can now also look at information from outside, like social media or general population trends. This helps find new ways to attract and keep good employees. - However, it’s important to remember that data is just one part of the puzzle. HR professionals still need to use their judgment and experience to make the best decisions. For example, while low pay might make people leave a job, other things like a good work environment or a short commute can also influence their decision to stay. - Basically, HR data analytics is a powerful tool that can help HR do its job better, but it shouldn’t replace human insight. THE EMPLOYMENT CYCLE A. PRE-HIRING STAGE This stage includes two important HRM Practices: Human Resource Planning (HRP) and Job Analysis B. HIRING STAGE This stage comprises recruitment and selection practices. It deals with the policies and procedures used by organizations to fill up an open position due to resignation, retirement, job abandonment, promotion, or transfer. C. POST-HIRING STAGE The aim of this stage is to implement HRM practices that will improve and sustain employee work performance level. This includes training and development, performance management, compensation and benefits, employee safety and health, and separation. HUMAN RESOURCE MANAGEMENT AND ORGANIZATIONAL SUCCESS TRADITIONAL VIEW PROGRESSIVE AND CURRENT VIEW Human resources are treated as costs. Human resources are treated as investments.  The progressive and current view is consistent with the Resource-Based View of the Firm which argues that an organization gains competitive advantage to the extent that it is able to utilize resources that are valuable, rare, inimitable, and non-substitutable.  Human resource management systems that are targeted at developing these unique qualities in employee attitudes and behaviors become sources of competitive advantage and lead to organizational success. HRM systems of the progressive type has been shown to positively influence organizational performance. STRATEGIC HUMAN RESOURCE MANAGEMENT  Strategic Human Resource Management (SHRM) consists of planned policies and practices that enable the achievement of organizational goals and objectives (Wright and McMahan, 1992). These HR policies and practices have a long-term focus that are internally consistent with and linked to the overall organizational strategy (Baker 1999)  Strategic HR is all about aligning people with organizational goals. It’s more than just managing employees; it’s about making sure the right people are in the right places to drive the company forward.  Instead of being a mere administrative function, HR should be a strategic partner, involved in high- level decision-making from the outset. This means working hand-in-hand with leadership to: 1. Build a high-performing workforce: Identifying, attracting, and developing talent to meet the company's evolving needs. 2. Create a positive work environment: Fostering employee engagement, well-being, and job satisfaction.  3. Optimize HR processes: Streamlining HR operations to increase efficiency and reduce costs.  By taking on this strategic role, HR can contribute significantly to the company's bottom line. For instance, by implementing effective talent management strategies, HR can help improve employee retention, reduce turnover costs, and enhance overall organizational performance.  Unfortunately, many organizations, especially in the Philippines, haven't fully embraced the concept of strategic HR. According to Supangco (2012), as cited by Supangco et al. (2021), only about 48.3% of respondent companies in the Philippines involved HR at the beginning in the development of a business strategy. There's still a tendency to view HR as a support function rather than a strategic business partner. This oversight limits the organization's potential to achieve its goals.  In essence, Strategic HR is when HR acts as a partner with company leaders to achieve shared goals. It's about using people to give the company a competitive edge. SHARED RESPONSIBILITY AND STRATEGIC ALIGNMENT IN HUMAN RESOURCE MANAGEMENT Effective human resource management (HRM) hinges on a collaborative approach, with distinct yet complementary roles for line managers and the HR department. Line Managers: As the individuals directly overseeing daily operations, line managers hold primary responsibility for implementing HR policies and procedures. This encompasses tasks such as performance management, employee relations, and adherence to established protocols. HR Department: When a dedicated HR department exists, it fosters a collaborative environment for policy development alongside line managers. HR serves as a strategic partner, providing expertise, guidance, and support on various HR functions. Research suggests that both parties share accountability for core HR activities like employee selection, training and development, and labor relations. While HR offers critical support, line managers typically take the lead in managing workforce adjustments, including expansions or reductions. Organizational Considerations:  HR Department Structure: The size and structure of an HR department are primarily influenced by organizational factors such as size, technological capabilities, and strategic objectives. Larger organizations often establish specialized HR departments dedicated to specific functions like recruitment, compensation, training, and employee relations. Conversely, smaller organizations might distribute these responsibilities among general management or various departmental heads due to resource constraints.  Outsourcing HR Functions: The practice of outsourcing specific HR tasks or processes, such as system development, recruitment, training, payroll, and benefits administration, has become increasingly common. This strategy allows organizations to focus on core competencies while leveraging external expertise.  Technology in HR: Technology has significantly transformed HR service delivery. Many organizations now rely on Human Resource Information Systems (HRIS) to manage various HR functions, including attendance tracking, employee records, benefits administration, and payroll processing.  Organizational Strategy and HR: An organization's strategic direction significantly influences the structure and function of its HR department. Companies that prioritize human capital as a strategic asset invest in dedicated HR units with specialized functions. For instance, innovation-driven organizations may require HR specialists focused on talent acquisition, development, and retention strategies to foster creativity and innovation. In contrast, cost-conscious organizations might allocate minimal resources to HR, viewing it primarily as a cost center. In such cases, HR functions may be centralized or dispersed with limited specialization. Therefore, successful HRM requires a collaborative framework with clearly defined roles for line managers and the HR department. By aligning HR strategies with organizational goals and leveraging technology and outsourcing effectively, organizations can empower their workforce and achieve sustainable competitive advantage. CURRENT TRENDS IN HUMAN RESOURCE MANAGEMENT The world of work is rapidly evolving, and HR departments are at the forefront of navigating these changes. Here are some of the most prominent trends shaping Human Resource Management today: A. Technology and Automation AI and Machine Learning: Automating routine tasks like resume screening, scheduling, and data analysis. HR Analytics: Using data to make informed decisions about workforce planning, talent management, and employee experience. Cloud-Based HR Systems: Enhancing accessibility, scalability, and collaboration. B. Employee Experience and Well-being Focus on Employee Experience: Creating a positive and engaging workplace culture. Mental Health and Well-being: Prioritizing employee mental health and work-life balance. Employee Engagement Strategies: Implementing initiatives to boost employee morale and productivity. C. Diversity, Equity, and Inclusion (DEI) Building Inclusive Workplaces: Fostering a culture of belonging and acceptance. DEI Training and Education: Providing resources to promote understanding and awareness. Diversity in Leadership: Increasing representation of diverse groups in leadership roles. D. Remote and Hybrid Work Flexible Work Arrangements: Offering remote, hybrid, or on-site options. Technology Infrastructure: Investing in tools to support remote work. Employee Communication: Maintaining effective communication in a distributed workforce. E. Talent Acquisition and Retention Employer Branding: Building a strong employer reputation to attract top talent. Employee Value Proposition: Clearly communicating the benefits of working for the company. Talent Development: Investing in employee growth and career advancement. F. Upskilling and Reskilling Lifelong Learning: Supporting continuous learning and development. Skill Gap Analysis: Identifying skills needed for future success. Reskilling Programs: Helping employees acquire new skills for job roles. G. Other Emerging Trends Gig Economy and Freelancing: Managing a contingent workforce. Employee Advocacy: Leveraging employees as brand ambassadors. Social Responsibility: Aligning HR practices with corporate social responsibility goals. THE HUMAN RESOURCE EXECUTIVE The HRM function faces tough challenges. Given intense competition in a global marketplace, the skills needed to effectively run the HR function become varied and encompasses the following: a. Strategic Thinking: HR executives must understand the overall business and its competitive landscape to align HR strategies with organizational goals. b. Talent Management: They need to anticipate future talent needs, attract top talent, and develop employees to reach their full potential. c. Business Insight: HR executives must be able to communicate the value of HR to top management and influence decision-making. d. Change Management: Adapting to a changing business environment requires HR leaders to be skilled in managing organizational change. e. Technical Expertise: A strong foundation in HR fundamentals is essential for effective HR leadership. f. Global Perspective: In today's interconnected world, HR executives must have a global mindset to compete effectively. Exercises 1.1 Instructions: Identify what is being described in each statement. 1. Feature which states that HRM is always present and involved in all parts of the organization. 2. HR executives must have this skill in order to understand the overall business and its competitive landscape. 3. Function of HRM which attracts qualified applicants to join the organization. 4. These are the individuals responsible for carrying out day-to-day operations and ensuring that HR policies are followed. 5. HRM function which ensures that a positive employer-employee relationship is maintained to enhance performance and satisfaction. 6. Feature that states the HRM focuses on developing each employee’s potential. 7. Adapting to a dynamic business environment requires HR executives to be skilled in ______________. 8. HRM function which employs the best talent who fits the organization and a target role. 9. HRM function which identifies the general ways of how work will be done by defining the specific tasks to be performed 10. A new technology that helps organizations manage HR functions. Individual Activity 1.1 A. Among the different functions of an HR manager, which one interest you? Why? Group Activity 1.1 1. Interview a Human Resource (HR) manager. a. What is a typical day on the job for the HR manager? b. What are typical positive and negative aspects of the job? c. What knowledge, skills, and abilities are required to work in the different functional areas in HR? d. Which functional areas do HR managers find most challenging? e. What is the role of and to what extent is the HR manager involved in strategy formulation and implementation in the organization? References  Dressler, G. (2020). Human Resource Management (16th ed.). Pearson Education, Inc.  Lauron, D. P. (2019). Human Resource Management: Principles and Practices (1st ed.). Rex Bookstore Inc.  Martocchio, J. J. (2019). Human Resource Management (15th ed.). Pearson Education Limited.  Supangco, V. T., Los Baños, J. A., & Ocampo, K. T. S. (2021). Human Resource Management in the Philippine Context. The University of the Philippines Press.  “The New Organization: Different by Design,” Global Human Capital Trends 2016 (2016). https://www2.deloitte.com/us/en/pages/human-capital/articles/introduction-human-capital- trends.html