Managing Human Resources PDF

NINTH CANADIAN EDITION HR MANAGING HUMAN RESOURCES BELCOURT SINGH SNELL MORRIS 04/13/2020 - tp-c3574e44-7dac-11ea-824e-024 (temp temp) - Managing Human Resources  HR...

NINTH CANADIAN EDITION HR MANAGING HUMAN RESOURCES BELCOURT SINGH SNELL MORRIS 04/13/2020 - tp-c3574e44-7dac-11ea-824e-024 (temp temp) - Managing Human Resources  HR NINTH CANADIAN EDITION MANAGING HUMAN RESOURCES Monica Belcourt, Ph.D., FCHRL York University Parbudyal Singh York University Scott A. Snell University of Virginia Shad S. Morris Brigham Young University Copyright 2020 Nelson Education Ltd. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Nelson Education reserves the right to remove additional content at any time if subsequent rights restrictions require it. 04/13/2020 - tp-c3574e44-7dac-11ea-824e-024 (temp temp) - Managing Human Resources  This is an electronic version of the print textbook. Due to electronic rights restrictions, some third party content may be suppressed. The publisher reserves the right to remove content from this title at any time if subsequent rights restrictions require it. For valuable information on pricing, previous editions, changes to current editions, and alternate formats, please visit www.nelson.com to search by ISBN#, author, title, or keyword for materials in your areas of interest. Copyright 2020 Nelson Education Ltd. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Nelson Education reserves the right to remove additional content at any time if subsequent rights restrictions require it. 04/13/2020 - tp-c3574e44-7dac-11ea-824e-024 (temp temp) - Managing Human Resources  Managing Human Resources, Ninth Canadian Edition by Monica Belcourt, Parbudyal Singh, Scott A. Snell, and Shad S. 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Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Nelson Education reserves the right to remove additional content at any time if subsequent rights restrictions require it. 04/13/2020 - tp-c3574e44-7dac-11ea-824e-024 (temp temp) - Managing Human Resources  To my son Brooker Belcourt, who engages me in stimulating discussions about the role of HR in the world of high tech and finance. To my wife, Nirmala Singh, and our children, Alysha, Amelia, and Aren, for all their love and support. Copyright 2020 Nelson Education Ltd. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Nelson Education reserves the right to remove additional content at any time if subsequent rights restrictions require it. 04/13/2020 - tp-c3574e44-7dac-11ea-824e-024 (temp temp) - Managing Human Resources  Features One of the clichés about the annual reports of companies is that they often CHAPTER 2 strategic planning Procedures for making decisions about the organization’s long-term goals and claim that “people are our most important asset.” You also hear this statement at academic and practitioner conferences. Do you believe this is true? Historically, Small Business application managers often have not acted as though they themselves believed it. Too often Strategy and Human strategies the focus has been on minimizing the number of a firm’s employees rather than Small businesses, by their size, provide for a much closer Let’s use a small printing company with 50 employees human resources planning strategically utilizing their talents. alignment between organizational and people strategies. as an example. This company has been created out of a need (hrp) But for many firms, this is changing. Surveys show that 92 percent of chief What is different for small business is threefold: (1) access to to provide printing services to a packaged-goods company. Resources Planning The process of anticipating and financial officers now believe human capital affects an organization’s customer providing for the movement of people resources to analyze the competitive landscape and market From this, the company has grown to take on additional clients. into, within, and out of an organization service, 82 percent believe it affects profitability, and 72 percent believe it affects innovation.1 And in a survey by the consulting firm Deloitte, nearly opportunities, (2) access to internal and available talent to However, the packaged-goods company still accounts for strategic human resources 80 percent of corporate executives said that the importance of HRM in their pursue markets or opportunities, and (3) being less constrained 40 percent of the revenue and profitability for the company. management (shrm) firms has grown substantially over the years, and two-thirds said that HR expen- by existing internal processes or structures in the pursuit of With this in mind, the strategic planning exercise focuses on The pattern of human resources ditures are now viewed as a strategic investment rather than simply a cost to new strategies. the following: (1) What does the company need to do to grow deployments and activities that enable be minimized. As we have seen, the development and integration of the business with the existing clients and identify new clients? an organization to achieve its strategic Forward-thinking companies are also demanding that their HR groups push goals HR in the strategic planning process require a scan of market (2) What risks are there of client or profitability erosion from past short-term projections and provide detailed forecasts for needs and the asso- ciated costs over a two- to three-year horizon. Even small companies are realizing opportunities and the competitive landscape. This research the existing client base? (3) What changes, if any, are required that their employees are the key to ensuring their ability to compete and survive. requires time, money, and expertise that may not be readily in the talent the company has in place to sell and deliver As Apple’s famous founder is reported to have said, “Hiring the best is your most available in small companies. So how do small companies printing services to meet these needs? important task.” And as GE’s legendary ex-CEO Jack Welch puts it: “We live in a develop and pursue strategy? Typically, small companies The challenge for small business is that by the very global economy. To have a fighting chance, every company needs to get every grow around a core competency, a single business activity nature of size, the range of talent available within the existing employee, with every idea in their heads and every morsel of energy in their that has been established to address a specific market organization will be constrained. As a result, any change in bodies, into the game.”2 need or specific large client requirement. From that centre, strategic direction may require retraining or recruitment of all research regarding market opportunities and threats is talent, both of which will take time and money and will depend Strategic Planning and Human reSourceS focused on identifying opportunities that are aligned with on the availability of training services or talent available to hire. LeaRning OutcOme 1 As we explained in Chapter 1, “competing through people” is the theme for this this core competency and guarding potential threats to the These factors will need to be considered in the development Why is HR planning integral to strategic book. But the idea remains only a premise for action until put it into practice. To core business. of strategy. planning? As an HR professional, what realize this theme, we need to understand some of the systems and processes in do you think you could do to tie the two organizations that link HRM and strategic management. A few definitions may be functions together? What role might the helpful upfront. firm’s mission, vision, and values play? Strategic planning involves a set of procedures for making decisions about the organization’s long-term goals and strategies. In this chapter, we discuss stra- tegic plans as having a strong external orientation that covers major portions of the organization. The plans especially focus on how the organization will posi- Yuri Arcurs/Shutterstock.com tion itself relative to its competitors to ensure its long-term survival, create value, and grow. Human resources planning (HRP), by comparison, is the process Summary of anticipating and providing for the movement of people into, within, and out Learning Outcomes of an organization. Overall, its purpose is to help managers deploy their human OUTCOME 1 SHRM integrates strategic planning OUTCOME 3 Conducting an internal analysis to resources as effectively as possible, where and when they are needed, to accom- and HRP. It can be thought of as the pattern of HR gauge the firm’s strengths and weaknesses involves After studying this chapter, you should be able to plish the organization’s goals. Strategic human resources management (SHRM) deployments and activities that enable an organiza- looking at a firm’s core capabilities, its talent and combines strategic planning and HRP. It can be thought of as the pattern of tion to achieve its strategic goals. The firm’s mission, composition in the firm, and its corporate culture. An LO 1 Explain how human resources planning and a firm’s LO 4 Explain the linkages between competitive strategies human resources deployments and activities that enable an organization to vision, and values provide a perspective on where internal analysis enables strategic decision makers to mission, vision, and values are integrally linked to its and human resources. achieve its strategic goals. the company is headed and what the organization assess the organization’s workforce—its skills, cul- strategy. HRP is an essential activity of organizations. Consider CNA Financial Corp., can become in the future. Ideally, they clarify the tural beliefs, and values. LO 5 Understand what is required for a firm to successfully an insurance company, for example. CNA Financial discovered via HRP that it long-term direction of the company and its strategic An organization’s success increasingly depends LO 2 Understand how an organization’s external environment implement a strategy and assess its effectiveness. would run short of underwriters—a key skill pool in the company—in just two intent. on the knowledge, skills, and abilities of employees, influences its strategic planning. years if its turnover rate continued at the current pace. The global strategies firms particularly as they help establish a set of core are increasingly pursuing, such as mergers, joint ventures, offshoring, the reloca- OUTCOME 2 Analyzing the firm’s external environ- capabilities that distinguish an organization from its LO 6 Describe how firms evaluate their strategies and human tion of plants, product innovation plans, and downsizing, are also making HRP ment is central to strategic planning. Environmental competitors. When employees’ talents are valuable, LO 3 Understand why it is important for an organization to do resources implementation. more critical and more complex for managers. The good news, according to the scanning is the systematic monitoring of major external rare, difficult to imitate, and organized, a firm can an internal resource analysis. president and CEO of the Human Resource Planning Society, is that increased forces influencing the organization, including forces achieve a sustained competitive advantage through global competitiveness, which in many industries has led to the commoditi- in the business environment and the competitive envi- its people. HRP is a systematic process that involves zation of products based on price, is making talent the “great differentiator” ronment. Changes in the external environment have forecasting the demand for labour, performing supply among firms. a direct impact on the way organizations are run and analysis, and balancing supply and demand consider- As we explained in Chapter 1, it is relatively easy for a competitor to copy your people are managed. Some of these changes repre- ations. Quantitative or qualitative methods help a firm product and make it more cheaply. But duplicating the talents of your employees sent opportunities, and some of them represent real identify the number and type of people needed to threats to the organization. meet the organization’s goals. NEL 40 PART 1: HUMAN RESOURCES MANAGEMENT IN PERSPECTIVE NEL 76 PART 1: HUMAN RESOURCES MANAGEMENT IN PERSPECTIVE NEL 02_ch02.indd 39 1/14/19 4:07 PM 02_ch02.indd 40 26/12/18 2:07 pm 02_ch02.indd 76 26/12/18 2:07 pm THE INTEGRATED LEARNING SYSTEM The Integrated Learning System (ILS) anchors chapter concepts and provides a framework for study. Learning Outcomes listed at the beginning of each chapter provide the basis for the Integrated Learning System. Each outcome is also listed in the margin of the chapter in which it appears, along with a thought-provoking question designed to get students thinking about how the related content applies to them personally. The ILS provides structure for instructors preparing lectures and exams and helps students learn quickly and study efficiently. who they serve. As a result, several jurisdictions across Canada are implementing Highlights in Hrm 4.2 Reality check new rules for HR professionals’ conduct. So who is an HR professional? According to Claude Balthazard, the vice president of regulatory affairs of the Human Resources Professional Association of Ontario: empowered employees achieve results... Those who work in the human resource management field are six sigma becoming increasingly professional; but saying this has different layers In today’s highly competitive and dynamic business environ- water per 1.5 million jeans produced, all while advancing of meaning. Increasingly, the HR profession is adopting the institutions Goodyear Canada underwent a major business transformation. cycle time, and increase customer satisfaction. The method- ment, employers as diverse as Home Depot and RBC have sustainability. characteristic of true professions, and HR professionals are adopting the At the time, it had nineteen Black Belts (full-time project ology is being applied not only to traditional manufacturing turned to their employees to improve organizational perfor- Apple uses a holistic team-based approach to running its attitudes, values, and behaviours of true professionals. It is a process that leaders) and seven Green Belts (part-time project leaders) processes but also to transactional processes—supply chain, mance. Empowered employees have made improvements in business. There are no committees at Apple. Teams are takes time, however. There is a difference between being professional working in offices, warehouses, and its eight Canadian tire and purchasing, invoicing, sales, and marketing. A Six Sigma team product or service quality, reduced costs, and modified or, in used to distribute the various responsibilities among key (adjective) and being a professional (noun). One aspect which differenti- rubber products manufacturing plants. Projects were projected follows five major steps known as DMAIC to clearly Define the executives, and they meet for three hours each week to ates true professions from other occupations is the existence of a gov- some cases, designed products. to yield $10 million in waste reduction, avoid capital equipment scope of the project, Measure customer requirements and pro- touch base. erning body which mandate is to protect and promote the public interest. At Kraft Foods, employees participated in work redesign One aspect that differentiates true professionals from members of other purchase, and increase sales through elimination of production cess outputs, Analyze the current situation and set clear goals, changes and team building that increased productivity, Although defining empowerment can become the first step bottlenecks. Improve the process through planned experimentation, and, occupations is the accountability to this governing body.64 reduced overhead, and cut assembly time. to achieving it, for empowerment to grow and thrive, organiza- Goodyear’s tire manufacturing facility in Medicine Hat, finally, Control to validate and lock in the improvement—and tions must encourage these conditions: Good HR managers help their organizations build a sustained competitive At a Ford factory, one group of employees made a sugges- Alberta, needed to produce more rubber from its Banbury then sustaining it so that there is no backslide. The model advantage. At lower levels in the organization, a rapidly growing number of com- tion that resulted in savings of $115,000 annually on the Participation. Employees must be encouraged to take rubber mixer to meet its daily quota and lessen its dependence moves the organization to whatever goals are required by the panies, including Ford Canada and UPS Canada, are assigning HR representatives purchase of gloves used to protect workers who handle control of their work tasks. Employees, in turn, must care on rubber produced by outside sources. In buying material, customer. Six Sigma derives its name from the Greek letter to their core business teams to make certain that HR issues are addressed on sheet metal and glass. The group figured out how to have about improving their work process and interpersonal work the job and that their HR representatives, in turn, are knowledgeable about core the factory was paying freight charges to get the rubber to the sigma, which is sometimes used to denote variation from a the gloves washed so that they could be used more than relationships. business issues rather than simply focusing on employee-related administrative factory. By optimizing the Banbury uptime and increasing the standard, and the statistical concept that if you measure the once. Innovation. The environment must be receptive to people functions. Banbury output, the factory could reduce the amount of rubber defects in a process, you can figure out how to get rid of them Home Depot’s Special Project Support Teams (SPSTs) work with innovative ideas and encourage people to explore new to improve the organization’s business and information it needed to purchase. Using the tools of Six Sigma, the factory and get closer to perfection. A Six Sigma company cannot pro- paths and to take reasonable risks at reasonable costs. An services. Employees with a wide range of backgrounds and empowered environment is created when curiosity is as determined that it could stagger shift rotations so that an oper- duce more than 3.4 defects per million opportunities. For a pro- skills collaborate to address a wide range of strategic and highly regarded as is technical expertise. ator was always available to keep the Banbury mixer running. cess with only one specification limit, this results in six process tactical business needs. The company was also able to increase the batch weight sizes standard deviations between the mean of the process and the Access to information. Employees must have access to a At Osler, Hosking and Harcourt LLP, teamwork is used to Small Business application wide range of information. Involved individuals decide what of some of the compounds by 4 percent to 11 percent. In addi- customer’s specification limit. deliver integrated, superior legal advice, which leads to kind of information they need for performing their jobs. tion, staging batches at the top of the conveyor and reducing These “lean” principles can also be used to identify defi- innovative solutions for their clients. Accountability. Empowerment does not involve being able the gate delay realized gains of two to three seconds per batch. ciencies in HR processes. The associate vice president of HR at Telus Mobility’s high-performance teams make them one Organizations have a variety of staff-related requirements size of the company, the nature of the business, the financial to do whatever you want. Empowered employees should Although three seconds does not sound like a great amount, Canadian Tire and his team analyzed the recruitment process of the top telecommunications leaders worldwide. be held accountable for their behaviour toward others, associated with supporting business operations. These could status of the company, the management structure, the struc- over the course of a week, it adds about 150 minutes of pro- from the initial request for a new hire to the time the new Levi Strauss’s Design Team came up with the waterless producing agreed-on results, achieving credibility, and include hiring, paying, managing, training, or terminating staff. ture of support roles, the leadership culture, and the approach ductivity. After six months, the factory increased its Banbury employee reported for work. They found delays, duplication, and Collection Jeans and saved the company 16 million litres of operating with a positive approach. This could also involve work design or staffing strategies and to using vendors. HR support may be delivered by business mixer output by more than 5 percent, generating savings of unnecessary steps. Applying lean methodology to recruitment, ensuring legal compliance. Traditionally, the role of an HR gen- owners themselves for very small companies, by managers for over $110,000. The Medicine Hat plant estimates that it can the team was able to reduce the time to fill a position by 25 Sources: Mindy S. Lubber, “How Timberland, Levi’s Use Teamwork to Advance Sustainability,” GreenBiz (May 9, 2011), http://www.greenbiz.com/ eralist is a position in medium or large organizations, those with slightly larger companies, and by office managers for larger blog/2011/05/09/how-companies-court-stakeholders-accelerate-sustainability; http://www.osler.com/aboutus/, accessed February 2015; Mark Milian, “Why save $250,000 to $400,000 annually by implementing the new percent, eliminated half of the steps used, reduced cost per hire Apple Is More Than Just Steve Jobs,” CNN (August 25, 2011). © 2019 Cengage Learning. 100 employees or more. companies. Small businesses may outsource some or all of this procedures. by 34 percent, and reduced turnover rates. Other companies, However, as of 2015, 98 percent of businesses in Canada support to vendors who support many clients. Activities such as Gary Blake, Goodyear Canada Six Sigma champion and a such as WorkSafe BC and Maple Leaf Foods, also saw the utility were considered small, and there are 1.14 million of these. The payroll, benefits, and legal support are often delivered through Black Belt, says that Six Sigma is a problem-solving model that of using Six Sigma in the recruitment process, reasoning that a vast majority of these would have fewer than 100 employees, vendors. applies rigorous statistical thinking to reduce defects, improve bad hire is like a product defect. which would be too small to justify having an HR generalist on The types of services traditionally delivered by HR general- staff. Small business represents 48 percent of private-sector ists in large enterprises that are delivered in small companies Sources: Interview with Gary Blake; V. Galt, “Canadian Tire Applied Its ‘Lean’ Ideals to Headquarters,” The Globe and Mail (February 23, 2012): B21; E. Kelly, “The industrial engineering induStrial engineering conSiderationS jobs in Canada, employing more workers than either large or are to a large extent driven by the industry, size, and geographic Skinny on Six Sigma,” HR Professional (March/April 2010): 26–27. A field of study concerned with The study of work is an important contribution of the scientific management move- medium enterprises. As a result, small business owners without location. For example, the HR needs in a retail environment analyzing work methods and ment. Industrial engineering, which evolved with this movement, is concerned HR generalists manage over five million employees in Canada. It with high employee turnover will focus largely on recruiting and establishing time standards “There are billions of people in Asia who want to get to where we are, and they’re with analyzing work methods and establishing time standards.20 Specifically, it is apparent that small business owners need the tools and prac- training, although the needs in a stable construction business involves the study of work cycles to determine which, if any, elements can be tices employed by HR generalists integrated into a handbook may centre around health and safety. Through this text, we will prepared to work longer and harder. So we have to work smarter.”10 modified, combined, rearranged, or eliminated to reduce the time needed to they can refer to as needed. dedicate a section of each chapter to the applicability to small The manufacturing of cars in Canada provides a good example of the impact complete the cycle. Next, time standards are established by recording the time of globalization. There is no such thing as a Canadian car. Most parts—up to Who is responsible for the delivery of HR responsibilities in business of the practices reviewed and will draw on industry- required to complete each element in the work cycle, using a stopwatch or work- 85 percent—of cars manufactured in Canada come from other countries. On the sampling technique. By combining the times for each element, observers can small business depends on a number of contextual factors: the specific examples that help demonstrate each practice. other hand, Canadian content represents about 10 percent for cars assembled determine the total time required. This time is subsequently adjusted to allow for outside Canada.11 the skill and effort demonstrated by the observed worker and for interruptions Source: Statistics Canada, “Key Small Business Statistics,” June 2016, https://www.ic.gc.ca/eic/site/061.nsf/eng/h_03018.html#point1-1, retrieved April 9, Partnerships and mergers are two other ways companies both large and small 2018. Reproduced and distributed on an “as is” basis with the permission of Statistics Canada. are globalizing. Coca-Cola has tried to expand in China by partnering with that that may occur in performing the work. The adjusted time becomes the time standard for that particular work cycle. nation’s largest juice maker. 144 PART 2: MEETING HUMAN RESOURCES REQUIREMENTS NEL 30 PART 1: HUMAN RESOURCES MANAGEMENT IN PERSPECTIVE NEL NEL CHAPTER 1: THE WORld Of HUMAN RESOURCES MANAGEMENT 7 04_ch04.indd 144 10/24/18 7:22 PM 01_ch01.indd 30 10/23/18 4:31 PM 01_ch01.indd 7 10/23/18 4:31 PM HIGHLIGHTS IN HRM SMALL BUSINESS REALITY CHECK This popular boxed feature provides APPLICATION Reality Check presents an interview real-world examples of how organiza- Small Business Application takes the prin- with a Canadian expert in the field, tions perform HR functions. Highlights ciples and prescriptions of a functional area, illustrating how the material in the are introduced in the text discussion such as recruitment, and demonstrates how chapter is used in the real world. and include topics such as small busi- these can be applied in a small business ness and international issues. setting. iv NEL Copyright 2020 Nelson Education Ltd. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Nelson Education reserves the right to remove additional content at any time if subsequent rights restrictions require it. 04/13/2020 - tp-c3574e44-7dac-11ea-824e-024 (temp temp) - Managing Human Resources  been developed that serve to facilitate benefits administration in areas such as pen- Figure 14.4 sions, variable pay, workers’ compensation, health benefits, and time-off programs. Descriptions of and advertisements for a variety of benefits software programs are regularly found in HR journals such as Canadian HR Reporter and Human Resource Ethics in HRM The Bargaining Zone and negoTiaTion influences Professional. Software programs represent a cost-effective way to manage employee Bargaining benefits programs when employers lack the resources or expertise. Writing It Wrong history between parties Most candidates for white-collar jobs prepare a résumé and which normally stands for International Baccalaureate of Law, submit it to prospective employers. They also complete the but he claimed stood for Incomplete Baccalaureate of Law. In the Business case application form, answering questions required by employers for comparison purposes. Resume padding seems to be on the one heart-wrenching case, a person who was ready to retire was found to have lied about his age decades earlier to get a Economic Laws and administrative influences rulings managing the costs of Benefits increase. To pad their resumes, applicants tend to “stretch” the job. On discovery, he was dismissed and lost his pension. In Union’s Management’s dates of their employment, misleading employers about the another case, a Canadian businessman was sentenced to eight preferred top limit The rising costs of benefits continue to pose a problem for orga- benefit plans nearly seamless. Other organizations are adapting nature of their duties, and misrepresenting their salaries. While months in jail in New Zealand for lying on his résumé by listing outcome INFLUE CING nizations big and small. These costs reportedly range anywhere flexible benefits, as you will see below. FACTORS you are writing a résumé, adding three months to your pre- false qualifications, including an MBA. Academic fraud happens Union’s expected Management’s from 14 to 50 percent of payroll when voluntary benefits are At Sobeys, benefit plans are intended to aid both full- and N vious employment, saying you were a night auditor instead of 5 percent of the time. The president of Selection Protection range of desired expected range accounted for. Hewitt Associates reports that flexible benefit part-time workers as they move through various life stages. results of desired results a clerk, and adding $950 to your last salary seem like relatively Services, a background check firm, offers this advice to job plans are gaining momentum in Canada as not only do they Sobeys rolled out its YouFlex Group Benefits program as the harmless lies. seekers: “Don’t lie.” She describes one candidate who wrote Management’s