3. An Introduction to HRM
Human Resources
HRM (policies, practices and systems)
Staff and Line Managers
Activities include:
Organizational restructuring
Job Design
Personnel Planning
Recruitment, hiring, evaluating, training, developing,
promoting, compensating and terminating services of
personnel.
4. Source of competitive advantage
Sustained competitive advantage
Bill Gates
Sam Walton
HPWS for enhancing firm’s competitiveness
Characteristics of HPWS
Large number of candidates for each strategic position, use
of validated selection and promotion procedures, extensive
T & D of employees, formal appraisal procedure, use of 360
degree feedback, linkage of merit increases to formal
appraisal, above market compensation for key positions,
high differential of pay between high and low performers,
high percentage of personnel in self managed project
teams, high percentage of jobs filled within
5. ACTIVITIES OF HRM
(1) Organizational Design
(2)Staffing
(3)Performance Management and Appraisal
(4)Employee and Organizational
Development, and
(5)Reward Systems, Benefits, and
Compliance.
6. Human Resource Policies & Practices
Selective Hiring
Extensive Training Programs
Self-managed teams and decentralised decision
making
Emphasis on high-quality performance
Pay for performance rewards
Employment security
Transformational leadership
7. IMPORTANCE OF HRM
Human resources form strength of an organization
Need to devise polices, practices and systems to attract,
employee and retain the best available talent
To meet the challenges, HR need to be given great
importance
Off shore operations, off shore employment
Optimal combination of people, software and equipment
to provide higher quality at lower price
Determining core competencies, outsourcing labor
Better arrangements for HR needs, managing diversity,
flexible work schedules, better training programs, child
care arrangements
8. STRATEGIC HR
HR systems help to determine how people are
recruited, trained, developed and retained.
An organization in order to meet its strategic
objectives should
(1) view the workforce in terms of contribution rather
than cost;
(2) use measurement as a tool for differentiating
contributions to strategic impact; and
(3) hold line and HR management responsible for
getting the workforce to execute strategy
9. Bottom-line criteria: profits or customer satisfaction
Strong relationship between employee satisfaction and
business outcomes
Organizations should strive to satisfy their employees
with (a) good pay (b) good supervision and (c)
stimulating work
South West’s culture: “put your employees first, and
they will take care of the customers”
Domino’s case
10. Competitive Advantage
Competitive advantage can be referred to the organization’s
ability to formulate strategies that place it in a favorable
position in relation to other companies. Customer value
and uniqueness are perceived to be the two most critical
factors for gaining competitive edge over other
organizations.
Customer Value: products & services valued more than
those of the competitors. Examples Wal-Mart, Domino’s,
McDonald’s, South-West Airlines, Harley Davidson
Maintaining Uniqueness: Keep products and services
unique, so it becomes hard for others to copy. Examples
Apple Computers, IBM
11. Organizations make efforts so that their uniqueness
lasts overtime. The four mechanisms for offering
uniqueness include: financial and economic capability
i.e. gaining advantage related to costs; strategic or
product capability i.e. gaining advantage related to
product or service innovation; technological or
operational ability i.e. gaining advantage related to
distinct way of delivering its products or services; and
organizational capability i.e. gaining advantage related
to manage organizational systems and people to match
customer and strategic needs.
12. Purposes of HRM
Develop policies and procedures
Harmonious relationship with employees
Compliance with law
Provide opportunities to employees to develop skills
Retain and develop staff to increase production
Meet economic and emotional needs of staff
Create safe and health environment
Attract and retain best staff for strategic goals
13. Benefits of welfare oriented
policies
Improvement in good will and image of the
company
Increase in efficiency and productivity of
workers
More congenial working relationship
Ability to attract and retain competent and
committed workforce
14. Benefits of good human relations
Committed employees result in more customer
satisfaction
Better team work among all cadres of employees
Cost savings due to efficiency of employees
Low absenteeism and minimum employee turnover
Open communication and sharing of information
Training and development of staff will be encouraged
15. Responsibilities of Senior HR
Manager to achieve objectives
Design appropriate structure
Communicate objectives and goals to employees
Should coordinate between functions and divisions
Make plans to achieve business and operational goals
Should define roles to employees
Design an appropriate reward system
Plan and implement policy decisions related to
training, rotations, career path and planning
Keep employees motivated all the time.