Because learning changes everything.

Chapter 10
Human Resource
Management

© 2022 McGraw Hill. All rights reserved. Authorized only for instructor use in the classroom. No
reproduction or further distribution permitted without the prior written consent of McGraw Hill.
 Learning Objectives 1

1. Explain why strategic human resource

management can help an organization gain a
competitive advantage.
2. Describe the steps managers take to recruit and
select organizational members.
3. Discuss the training and development options
that ensure organization members can effectively
perform their jobs.

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 Learning Objectives 2

4. Explain why performance appraisal and feedback

are such crucial activities, and list the choices
managers must make in designing effective
performance appraisal and feedback procedures.
5. Explain the issues managers face in determining
levels of pay and benefits.
6. Understand the role that labor relations play in
the effective management of human resources.

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 Strategic Human Resource
Management 1

Human resource management (HRM):

• Activities that managers engage in to attract and
retain employees and to ensure that they perform
at a high level and contribute to the
accomplishment of organizational goals.

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 Strategic Human Resource
Management 2

Strategic human resource management:

• The process by which managers design the
components of an HRM system to be consistent
with each other, with other elements of
organizational architecture, and with the
organization’s strategy and goals.
• HRM is now a critical component of strategic
agendas.

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 Figure 12.1 Components of a Human
Resource Management System

Access the text alternative for slide images.

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 The Legal Environment of HRM
Equal employment opportunity (EEO):
• The equal right of all citizens to the opportunity to
obtain employment regardless of their gender,
age, race, country of origin, religion, or disabilities.

Equal Employment Opportunity Commission

(EEOC):
• Enforces employment laws.

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 Table 12.1 Major Equal Employment
Opportunity Laws Affecting HRM 1

Year Law Description

1963 Equal Pay Act Requires that men and women be paid equally if they
are performing equal work
1964 Title VII of the Civil Prohibits employment discrimination on the basis of
Rights Act race, religion, sex, color, or national origins--covers a
wide range of employment decisions, including hiring,
firing, pay, probation, and working conditions
1967 Age Discrimination in Prohibits discrimination against workers over the age of
Employment Act 40 and restricts mandatory retirement
1978 Pregnancy Prohibits employment discrimination against women on
Discrimination Act the basis of pregnancy, childbirth, and related medical
decisions
1986 Immigration Reform Prohibits discrimination on the basis of natural origin or
and Control Act citizenship, except for illegal immigrants, by employers
having four or more employees.

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 Table 12.1 Major Equal Employment
Opportunity Laws Affecting HRM 2

Year Law Description

1990 Americans with Prohibits employment discrimination against individuals
Disabilities Act with disabilities and requires that employers make
accommodations for such workers to enable them to
perform their jobs.
1991 Civil Rights Act Prohibits discrimination (as does Title VII) and allows the
awarding of punitive and compensatory damages, in
addition to back pay, in cases of intentional discrimination.
1993 Family and Medical Requires that employers provide 12 weeks of unpaid
Leave Act leave for medical and family reasons, including paternity
and illness of a family member.
1994 Uniformed Services Requires rehiring of employees who are absent for
Employment and military service, with training and accommodations as
Reemployment needed.
Rights Act
2009 Lilly Ledbetter Fair Allows employees to claim discriminatory compensation
Pay Act within a set time after receiving a discriminatory paycheck.

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 Contemporary Challenges for Managers
How to eliminate sexual How to minimize the
harassment. wage gap between
women and men
How to make
accommodations for How to deal with
employees with employees with
disabilities. substance abuse
problems, mental
How to ensure that LGBT
health issues.
employees are treated
equally. How to ensure the
inclusion for all
How to address religious
employees.
rights.
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 Recruitment and Selection
Recruitment:
• Activities that managers engage in to develop a
pool of candidates for open positions.

Selection:
• The process that managers use to determine the
relative qualifications of job applicants and their
potential for performing well in a particular job.

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 Figure 12.2 The Recruitment and
Selection System

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 Human Resource Planning 1

Human resource planning (HRP):

• Activities that managers engage in to forecast
their current and future needs for human
resources.

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 Human Resource Planning 2

Demand forecasts:
• Estimates the qualifications and numbers of
employees the firm will need given its goals and
strategies.

Supply forecasts:
• Estimates the availability and qualifications of
current employees now and in the future, as well
as the supply of qualified workers in the external
labor market.

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 Human Resource Planning 3

Outsourcing:
• Using outside suppliers and manufacturers to
produce goods and services.
• Using contract workers rather than hiring them.
• More flexible for the firm.
• Provides human capital at a lower cost.

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 Job Analysis 1

Job analysis:
Job description:
• Identifying the tasks, duties and responsibilities that make
up a job.

Job specifications:
• Knowledge, skills, and abilities needed to perform the job.

Should be done for each job in the organization.

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 Job Analysis 2

Job analysis PAQ: Position Analysis

methods: Questionnaire:
• Observing what Six divisions:
current workers do. • Information input.
• Having workers and
• Mental processes.
manages fill out
questionnaires. • Work output.
• Relationships with others.
• Job context.
• Work pace.

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 Recruitment 1

External recruiting:
• Looking outside the organization for people who
have not worked at the firm previously.
• Job postings on career websites, job fairs and
recruitment meetings with groups in the local
community, career fairs at colleges, open houses,
advertising in local newspapers.

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 Recruitment 2

Advantages of external recruiting:

• Having access to a potentially large applicant
pool.
• Being able to attract people who have the skills,
knowledge, and abilities an organization needs.
• Bringing in newcomers who may have a fresh
approach to problems and be up to date on the
latest technology.

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 Recruitment 3

Disadvantages of external recruiting:

• High cost.
• Additional training.
• Will they be good performers?

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 Recruitment 4

Internal recruiting:
• Managers turn to existing employees to fill open
positions.

Benefits of internal recruiting:

• Internal applicants are already familiar with the
organization.
• Managers already know candidates.
• It can help boost levels of employee motivation
and morale.

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 Recruitment 5

Disadvantages of internal recruiting:

• Limited pool of candidates.
• Candidates “set” in organization’s ways.
• Lack of suitable internal candidates.
• External recruiting may bring new ideas and
approaches.

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 Honesty in Recruiting
Realistic job preview (RJP):
• An honest assessment of the advantage and
disadvantages of a job and organization.
• Can reduce the number of new hires who quit
when jobs and organizations fail to meet their
unrealistic expectations.

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 The Selection Process
Selection process:
• Managers finding out whether each applicant is
qualified for the position and likely to be a good
performer.
• Background, interviews, tests, references.

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 Figure 12.3 Selection Tools

Access the text alternative for slide images.

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 Reliability and Validity
Reliability:
• The degree to which the tool or test measures the
same thing each time it is used.

Validity:
• The degree to which a tool or test measures what
it purports to measure.

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 Training and Development 1

Training:
• Teaching organizational members how to perform
current jobs and helping them to acquire the
knowledge and skills they need to be effective
performers.

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 Training and Development 2

Development:
• Building the knowledge and skills of organizational
members so they are prepared to take on new
responsibilities and challenges.

Needs assessment:
• An assessment of which employees need training
or development and what type of skills or
knowledge they need to acquire.

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 Figure 12.4 Training and Development

Access the text alternative for slide images.

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 Performance Appraisal and Feedback 1

Performance appraisal:
• The evaluation of employees’ job performance
and contributions to their organization.
• Focuses on the evaluation of traits, behaviors,
results.
• Objective or subjective assessment.

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 Figure 12.5 Subjective Measures of
Performance 1

Access the text alternative for slide images.

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 Figure 12.5 Subjective Measures of
Performance 2

Access the text alternative for slide images.

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 Figure 12.6 Who Appraises
Performance?

Access the text alternative for slide images.

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 Performance Appraisal and Feedback 2

Performance feedback:
• The process through which managers share
performance appraisal information with
employees, give employees an opportunity to
reflect on their own performance, and develop—
with subordinates—plans for the future.

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 Effective Performance Feedback
Formal appraisals:
• An appraisal conducted at a set time during the
year and based on performance dimensions that
were specified in advance.

Informal appraisals:
• An unscheduled appraisal of ongoing progress
and areas for improvement.

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 Effective Feedback Tips 1

1. Be specific and focus on behaviors or outcomes

that are correctable and within a worker’s ability
to improve.
2. Approach performance appraisal as an exercise
in problem solving and solution finding, not
criticizing.
3. Express confidence in an employee’s ability to
improve.
4. Provide performance feedback both formally and
informally.
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 Effective Feedback Tips 2

5. Praise instances of high performance and areas

of a job in which a worker excels.

6. Avoid personal criticisms and treat employees

with respect.

7. Agree to a timetable for performance

improvements.

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 Pay and Benefits 1

Pay:
• Includes employees’ base salaries, pay raises,
and bonuses.
• Determined by characteristics of the organization
and the job and levels of performance.
• Benefits based on membership in an organization.

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 Pay and Benefits 2

Pay level
• The relative position of an organization’s
incentives in comparison with those of other firms
in the same industry employing similar kinds of
workers.
• Four Seasons Hotels and Resorts: “100 Best
Companies to Work For” (Fortune).

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 Pay Structure
• The arrangement of
jobs into categories
based on their
relative importance
to the organization
and its goals, level
of skills, and other
characteristics.

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 Pay and Benefits 3

Benefits:
• Legally required: Social Security, workers’
compensation, unemployment insurance, health
insurance for employers with 50 or more
employees.
• Voluntary: Retirement, day care, flexible working
hours.
• Cafeteria-style benefits plans. Employees choose
the best mix of benefits for them, but can be hard
to manage.

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 Labor Relations
The activities managers engage in to ensure they
have effective working relationships with the labor
unions that represent their employees’ interests.
Governmental efforts:
• 1938: Fair Labor Standards Act.
• 1963: Equal Pay Act.
• 1970: Occupational Safety and Health Act.

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 Unions
• Represent workers’ interests to management in
organizations.
• A united group inevitably wields more power
than individual, and this type of power
especially helpful to employees in some
organizations.

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 Collective Bargaining
• Negotiation between labor and management to
resolve conflicts and disputes about issues such
as working hours, wages, benefits, working
conditions, and job security.
• Grievance procedure.

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 Example: Wonderlic
Wonderlic provides many tools for pre-
screening employees.
Visit the WonScore page at the Wonderlic site
where demos are available for their cognitive,
personality and other tests.

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Because learning changes everything. ®

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© 2022 McGraw Hill. All rights reserved. Authorized only for instructor use in the classroom. No
reproduction or further distribution permitted without the prior written consent of McGraw Hill.