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1-1McGraw-Hill/IrwinUnderstanding Business, 8e © 2008 The McGraw-Hill Companies, Inc., All Rights

Reserved.

Nickels McHugh McHughNickels McHugh McHugh

**Human ResourceHuman Resource

Management:Management:Finding and Finding and

Keeping the BestKeeping the Best EmployeesEmployees 11

CH

AP

TE

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11-2

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HR ChallengesHR Challenges• ShortagesShortages

• Unskilled WorkersUnskilled Workers

• Undereducated Undereducated WorkersWorkers

• Shift in Workforce Shift in Workforce CompositionComposition

• Laws & RegulationsLaws & Regulations

• Single-Parent & Two-Single-Parent & Two-Income FamiliesIncome Families

• Attitudes Toward Attitudes Toward WorkWork

• Continued Continued DownsizingDownsizing

• Overseas Labor Overseas Labor PoolsPools

• Customized BenefitsCustomized Benefits

• Employees With New Employees With New ConcernsConcerns

• Decreased LoyaltyDecreased Loyalty

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Determining HR NeedsDetermining HR Needs

1.1.Prepare HR Prepare HR InventoryInventory

2.2.Prepare Job Prepare Job AnalysisAnalysis

• Job Job DescriptionDescription

• Job Job SpecificationSpecification

3.3.Assess HR Assess HR DemandDemand

4.4.Assess HR Assess HR SupplySupply

5.5.Establish Establish Strategic PlanStrategic Plan

11-4

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Hiring ProcessHiring Process

• RecruitRecruit

• SelectSelect• Application FormApplication Form

• InterviewInterview

• TestTest

• InvestigateInvestigate

• ExamineExamine

• ProbationProbation

• Train/DevelopTrain/Develop• OrientationOrientation

• OJTOJT

• ApprenticeshipApprenticeship

• Off-The-Job TrainingOff-The-Job Training

• Online TrainingOnline Training

• Vestibule TrainingVestibule Training

• Job SimulationJob Simulation

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HR Executives’ HR Executives’ Recruiting PreferencesRecruiting Preferences

Source: USA Today

Note: Multiple responses allowed

11-6

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Applicants’ MistakesApplicants’ Mistakes

14%

32%

21%

6% 7%

9%

9%

2%Interview

Resume

Cover Letter

Reference Checks

Interview Follow-up

Screening Call

Other

Do Not Know

Source: USA Today

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Interviewing MistakesInterviewing Mistakes3%5%

18%

25%49%

Little/No Knowledgeof Company

Unprepared toDiscuss Career Plans

Limited Enthusiasm

No Eye Contact

Unprepared toDiscussSkills/Experience

Source: USA Today

11-8

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Number Interviewed to Number Interviewed to Find Quality HireFind Quality Hire

0% 10% 20% 30% 40% 50%

More than 10

7 to 10

4 to 6

2 to 3

One

Source: USA Today, January 24, 2005

11-9

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Important Factors WhenImportant Factors When Phrasing Interview Phrasing Interview

QuestionsQuestions• LanguageLanguage

• RelevanceRelevance

• Information LevelInformation Level

• ComplexityComplexity

• Information AccessibilityInformation Accessibility

Source: University of Central Arkansas

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Training & DevelopmentTraining & Development

• Assess NeedsAssess Needs

• Design TrainingDesign Training

• Evaluate EffectivenessEvaluate Effectiveness

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Training MethodsTraining Methods

1.1. Employee OrientationEmployee Orientation

2.2. On-The-JobOn-The-Job

3.3. ApprenticeshipApprenticeship

4.4. Off-The-JobOff-The-Job

5.5. OnlineOnline

6.6. VestibuleVestibule

7.7. Job SimulationJob Simulation

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Management Management DevelopmentDevelopment

• On-The-Job On-The-Job CoachingCoaching

• UnderstudyUnderstudy

• Job RotationJob Rotation

• Off-The-Job Courses Off-The-Job Courses & Training& Training

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Performance AppraisalPerformance Appraisal1. Establish Standards2. Communicate

Standards3. Evaluate

Performance4. Discuss Results

5. Take Corrective Action

6. Use Results to Make Decisions

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Employee RetentionEmployee Retention

• Compensation

• Individual

• Team

• Fringe Benefits

• Job-Sharing

• Flextime

• Core Time

• Compressed Workweek

• Home-Based & Mobile Work

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Compensation & BenefitsCompensation & Benefits Program ObjectivesProgram Objectives

• Attract the right peopleAttract the right people

• Employee incentives Employee incentives

• Retain valued employeesRetain valued employees

• Maintain competitivenessMaintain competitiveness

• Financial security for Financial security for

employeesemployees

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Pay SystemsPay Systems

• SalarySalary

• Hourly wage and Hourly wage and dayworkdaywork

• Piecework systemPiecework system

• Commission plansCommission plans

• Bonus plansBonus plans

• Profit-sharing Profit-sharing plansplans

• Gain-sharing plansGain-sharing plans

• Stock optionsStock options

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Vacation Days Per YearVacation Days Per Year

13

25

25

26

28

34

35

37

42

0 10 20 30 40 50

USA

Japan

Korea

Canada

UK

Brazil

Germany

France

Italy

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Scheduling To Meet Scheduling To Meet Employee NeedsEmployee Needs

• Flextime PlansFlextime Plans

• Home-Based & Other Home-Based & Other Mobile WorkMobile Work

• Job-Sharing PlansJob-Sharing Plans

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Number of HoursNumber of Hours Americans Work Per WeekAmericans Work Per Week

1-29 Hours10%51+ Hours

18%

46-50 Hours16%

41-45 Hours12%

30-39 Hours10%

40 Hours34%

Source: Source: USA Today

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Telecommuting:Telecommuting: Affect on CareerAffect on Career

6%

25%

30%

39%

No Affect

Help

Hurt

Not Sure/NoAnswer

Source: USA Today

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Benefits of Job-SharingBenefits of Job-Sharing

• Opportunities for wanting to work only Opportunities for wanting to work only part-timepart-time

• High level of enthusiasm and High level of enthusiasm and productivityproductivity

• Reduced absenteeism and tardinessReduced absenteeism and tardiness

• Ability to schedule in peak demand Ability to schedule in peak demand periodperiod

• Retention of experienced workersRetention of experienced workers

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How Employers AreHow Employers Are Becoming FlexibleBecoming Flexible

0% 20% 40% 60% 80% 100%

Employees Schedule Their OwnVacation

Permit Time Off To Deal WithPersonal Issues

Offer Flexible Work Schedule

Go Out Of Their Way toAccommodate Child-care Issues

Source: insala.com, April 2005Source: insala.com, April 2005

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Benefits of Benefits of Providing FlexibilityProviding Flexibility

0% 20% 40% 60% 80% 100%

Better RelationsWith Workers

Higher EmployeeJob Satisfaction

Higher EmployeeRetention

Source: Insala.com, April 2005

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Why is Retention Important?

• Employee turnover could cost up to 40% Employee turnover could cost up to 40% of a company’s annual profitsof a company’s annual profits

• The average company loses $1 million The average company loses $1 million with the loss of every ten managerial with the loss of every ten managerial employeesemployees

• Turnover costs are 50%-100% of the ex-Turnover costs are 50%-100% of the ex-employees’ annual salaryemployees’ annual salary

Source: insala,com, April 2005

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Top 10 Reasons Top 10 Reasons Employees Stay On Their Employees Stay On Their

JobJob1.1. Credit Union Credit Union

Membership Membership

2.2. Health Benefits Health Benefits

3.3. Salary Salary

4.4. Good Coworkers Good Coworkers

5.5. Office Hours Office Hours

6.6. Childcare Childcare

7.7. Vacation TimeVacation Time

8.8. Sick Leave Sick Leave

9.9. Distance from Home Distance from Home

10.10. Popular Company Popular Company

Source: Source: Creditunionrate.com, accessed July 13, 2006

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Employee MovementEmployee Movement

• Promotion/ReassignmentPromotion/Reassignment

• TerminationTermination

• RetirementRetirement

• ResignationResignation

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HR LawsHR Laws• Civil Rights Act (1964)Civil Rights Act (1964)

• Age Discrimination Act (1967)Age Discrimination Act (1967)

• Equal Employment Opportunity Act (1972)Equal Employment Opportunity Act (1972)

• Affirmative ActionAffirmative Action

• Reverse DiscriminationReverse Discrimination

• Civil Rights Act (1991)Civil Rights Act (1991)

• Americans with Disabilities Act (1990)Americans with Disabilities Act (1990)

• Social Security Act (1935)Social Security Act (1935)

• Occupational Safety and Health Act (1970)Occupational Safety and Health Act (1970)

• Employment Retirement Income Security Act (1974)Employment Retirement Income Security Act (1974)

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Implementing EEOC Implementing EEOC Which statements are T/F? Which statements are T/F?

1.1. It’s OK to ask any applicant whether It’s OK to ask any applicant whether he or she has an automobile.he or she has an automobile.

2.2. It appropriate to ask applicants to It appropriate to ask applicants to attach photographs.attach photographs.

3.3. During interviews, it’s not During interviews, it’s not appropriate to ask an applicant appropriate to ask an applicant his/her age.his/her age.

4.4. It’s appropriate to ask if an applicant It’s appropriate to ask if an applicant is a naturalized citizen.is a naturalized citizen.

5.5. It’s not appropriate to ask an It’s not appropriate to ask an applicant about past work applicant about past work experience.experience.

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Implementing EEOC Implementing EEOC Which statements are T/F? Which statements are T/F?6.6. You may ask an applicant to indicate You may ask an applicant to indicate

what foreign languages he/she can what foreign languages he/she can read, write or speak fluently.read, write or speak fluently.

7.7. It’s appropriate to ask an applicant if It’s appropriate to ask an applicant if he/she has an arrest record.he/she has an arrest record.

8.8. It’s OK to ask whether the applicant is It’s OK to ask whether the applicant is physically able to lift heavy weights.physically able to lift heavy weights.

9.9. It’s appropriate to ask women It’s appropriate to ask women questions about their children.questions about their children.

10.10.You have the right to ask an applicant You have the right to ask an applicant for names of work-related and personal for names of work-related and personal references.references.

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Companies’ Aid to Disabled Employees

0% 10% 20% 30% 40% 50%

Change ofResponsibilities

Change of Hours

JobReassignments

RenovateWorkplace

Source: USA Today