C01_Human_Resource_Management_Gaining_a.ppt

Human Resource Management:
Gaining a Competitive Advantage
Chapter 01
Human Resource Management:
Gaining a Competitive Advantage
Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.
McGraw-Hill/Irwin

Learning Objectives
 Discuss roles and activities of HRM function
 Discuss implications of the economy, makeup of the
labor force and ethics for company sustainability
 Discuss how HRM affects a balanced scorecard
 Discuss what companies should do to compete in
global marketplace
 Identify how technology such as social networking is
influencing HRM
 Discuss HRM practices that support high-
performance work systems
 Provide a brief description of HRM practices
1-2

Introduction
Competitiveness – a company’s ability to
maintain and gain market share.
Human resource management (HRM) – the
policies, practices, and systems that influence
employees’ behavior, attitudes and
performance.
1-3

Responsibilities of HR Departments
1. Employment and Recruiting
2. Training and Development
3. Compensation
4. Benefits
5. Employee Services
6. Employee and Community Relations
7. Personnel Records
8. Health and Safety
9. Strategic Planning
1-5

HR as a Business with 3 Product Lines
Business
Partner
Services
Strategic Partner
Human
Resources
1-6

6 HR Competencies
Credible
Activist
Cultural
Steward
Business
Ally
Strategic
Architect
Operational
Executor
Talent Manager/
Organizational
Designer
1-7

Strategic Role of the HRM Function
Time spent on administrative tasks is decreasing.
HR roles as a strategic business partner, change
agent and employee advocate are increasing.
HR is challenged to shift focus from current
operations to future strategies and prepare non-HR
managers to develop and implement HR practices.
This shift presents two challenges:
 Self-service
 Outsourcing
1-8

Shared Service Model
Shared Service Model is a way to organize
the HR function that includes centers of
expertise or excellence, service centers
and business partners to help control costs
and improve business-relevance and
timeliness of HR practices.
1-9

HR Playing a Strategic Role
in the Business?
1. What is HR doing to provide value-added
services to internal clients?
2. What can HR add to the bottom line?
3. How are you measuring HR effectiveness?
4. How can we reinvest in employees?
1-10

Questions, cont.
5. What HR strategy will get the business from
point A to point B?
6. What makes an employee want to stay?
7. How will we invest in HR for a better HR
department than competitors have?
8. What should we be doing to improve our
marketplace position?
9. What’s the best change to prepare for the
future?
1-11

How is the HRM Function Changing?
As part of its strategic role, HR can engage
in evidence-based HR.
Evidence-based HR – demonstrating that
HR practices have a positive influence on
the company’s bottom line or key
stakeholders.
1-12

The HRM Profession
HR salaries vary according to position,
experience, education, training, location and
firm size.
The primary professional organization for
HRM is the Society for Human Resource
Management (SHRM) (www.shrm.org)
1-13

3 Competitive Challenges
Influencing HRM
Sustainability
Technology
1-14

The Sustainability Challenge
Sustainability is the ability of a company to
survive and succeed in a dynamic
competitive environment.
Stakeholders include shareholders, the
community, customers and all other parties
that have an interest in seeing that the
company succeeds.
1-15

Sustainability includes the ability to:
 deliver a return to shareholders
 provide high-quality products, services
and work experiences for employees
 increase value placed on intangible
assets, human capital and social
responsibility
 adapt to changing characteristics and
expectations
of the labor force
 address legal and ethical issues
 effectively use new work arrangements
1-16

Economy- Implications for HR
Structure of the economy
Development and speed of social media
Growth in professional and service occupations
 Skill demands for jobs are changing
Knowledge is becoming more valuable
 Intangible assets
 Knowledge workers
 Empowerment
Learning organization
 Social collaboration and social networking
technology
1-17

Psychological
Contract
Alternative
Work
Arrangements
Changes in
Employment
Expectations
1-18

Common Themes of Employee Engagement
 Pride and satisfaction with employer and job
 Opportunity to perform challenging work
 Recognition and positive feedback from contributions
 Personal support from manager
 Effort above and beyond the minimum
 Understanding link between one’s job and company’s mission
 Prospects for future growth with the company
 Intention to stay with the company
1-19

Talent Management
 Talent management is the systematic planned
strategic effort by a company to use bundles of
HRM practices including acquiring and
assessing employees, learning and
development, performance management , and
compensation to attract, retain, develop, and
motivate highly skilled employees and
managers.
 Growth of contingent workers and part-time
employees
1-20

The Balanced Scorecard
The balanced scorecard provides a view
of the company from the perspective of
internal and external customers, employees
and shareholders.
The balanced scorecard should be used
to:
Link HRM activities to the company’s business
strategy.
Evaluate the extent to which HR is helping meet
the company’s strategic objectives.
1-21

The Balanced Scorecard
 How do customers see us?
 What must we excel at?
 Can we continuously improve and create
value?
 How do we look to shareholders?
1-22

Customer Service and Quality
Total Quality Management (TQM) Core Values
• Methods and processes are designed to meet
internal and external customers’ needs.
• Every employee receives training in quality.
• Promote cooperation with vendors, suppliers and
customers.
• Managers measure progress with feedback based
on data.
• Quality is designed into a product or service so that
errors are prevented rather than being detected and
corrected.
1-23

Customer Service and Quality
Malcolm Baldrige National Quality Award
ISO 9000:2000
Six Sigma Process
Lean Thinking
1-24

Changing Demographics
Workforce Diversity
Internal labor force - current employees
External labor market - persons outside
the firm actively seeking employment
U.S. workforce is aging rapidly
Increased workforce diversity
Influence of immigration
1-25

Managing a Diverse Workforce
To manage a diverse workforce, managers must develop
new skills to:
 Communicate, coach and develop employees from a
variety of cultural and educational backgrounds,
ethnicity, age, ability and race.
 Provide performance feedback based on objective
outcomes.
 Create a work environment that makes it comfortable
for employees of all backgrounds to be creative and
innovative.
 Recognize and respond to generational issues.
1-26

Legal and Ethical Issues
5 legal areas that influenced HRM :
1. Equal employment opportunity legislation
2. Employee safety and health
3. Employee pay and benefits
4. Employee privacy
5. Job security
Women and minorities still face the “glass ceiling”
Sarbanes-Oxley Act of 2002
Federal health care legislation
Companies which employ unlawful immigrants or abuse
laborers
Data-security practices and protecting intellectual property
1-27

Legal and Ethical Issues
 Ethics - the fundamental principles by which employees and
companies interact
 Ethical HR practices:
 HRM practices must result in the greatest good for the
largest number of people
 Employment practices must respect basic human rights of
privacy, due process, consent, and free speech
 Managers must treat employees and customers equitably
and fairly
 Managers must develop and distribute a Code of Ethics,
policies, processes and procedures, audit and train
employees
1-28

4 Principles of Ethical Companies
1. Successful companies, in relationships with
customers, vendors and clients, emphasize mutual
benefits.
2. Employees assume responsibility for the actions of
the company.
3. Companies have a sense of purpose or vision the
employees value and use in their day-to-day work.
4. They emphasize fairness; another person’s interests
count as much as their own.
1-29

The Global Challenge
To survive companies must deal with the
global economy, compete in and develop
global markets and prepare employees for
global assignments.
Offshoring – exporting jobs from developed
countries to less developed countries
Onshoring – exporting jobs to rural parts of
the United States
1-30

Technology Challenge
The overall impact of the Internet
The Internet has created a new
business model – e-commerce – for
conducting business transactions and
relationships electronically.
 Social networking
1-31

The Technology Challenge
Advances in technology have:
changed how and where we work
resulted in high-performance work
systems
increased the use of teams to improve
customer service and product quality
changed skill requirements
increased working partnerships
led to changes in company structure and
reporting relationships
1-32

The Technology Challenge
Advances in technology have increased:
 use and availability of Human Resource
Information Systems (HRIS)
 use and availability of e-HRM
 competitiveness in high-performance work
systems
 HR Dashboard Metrics
1-33

High-Performance Work Systems
 Work in teams, virtual teams’ and partnerships
 Changes in skill requirements
 Changes in company structure and reporting
relationships
 Increased use and availability of e-HRM and Human
Resource Information Systems (HRIS)
 HRM practices support high-performance work
systems through staffing, work design, training,
compensation and performance management.
1-34

Meeting 4 Competitive Challenges
Through HRM Practices
HRM practices that help companies deal with
the four competitive challenges can be
grouped into four dimensions:
1. The HR environment
2. Acquiring and preparing HR
3. Assessment and development of HR
4. Compensating HR
1-35

Meeting Competitive Challenges
Managing internal and external environmental
factors allows employees to make the greatest
possible contribution to company productivity
and competitiveness.
Customer needs for new products or services
influence the number and type of employees
businesses need to be successful.
1-36

Meeting Competitive Challenges
Managers need to ensure that employees
have the necessary skills to perform current
and future jobs.
Besides interesting work, pay and benefits
are the most important incentives that
companies can offer employees in exchange
for contributing to productivity, quality, and
customer service.
 Create pay systems, reward employee
contributions and provide benefits
1-37

Summary
 HR has three product lines: administrative services, business partner
services, and strategic services.
 To successfully manage HR, individuals need personal credibility,
business and technology knowledge, understanding of business
strategy, and ability to deliver HR services.
 HR management practices should be evidence-based.
 HR practices are important for helping companies deal with
sustainability, globalization, and technology challenges.
 HR managers must address global and technology challenges.
1-38

C01_Human_Resource_Management_Gaining_a.ppt

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