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  • Gary DesslerFundamentals of Human Resource Management2e

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    14-*Building High-Performance Work Systems and Improving Strategic ResultsChapter 14

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    When you finish studying this chapter, you should be able to: Define high-performance work system.List four characteristics of high-performance work systems.Give an example of using evidence-based management.Discuss, with examples, how to conduct an HR audit.List and explain at least five HR metrics.Explain the process you would use to select an outsourcing vendor.14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    What Are High-Performance Work Systems?High-performance work systemAn integrated set of human resources policies and practices that together produce superior employee performance14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    High-Performance Human Resource Policies and PracticesHuman resource metricThe quantitative measure of some human resource management yardstick, such as employee turnover, hours of training per employee, or qualified applicants per position14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    Comparison of HR Practices in High-Performance and Low-Performance Companies: Table 14.114-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    How High-Performing Firms Organize Their HR Practices: Table 14.1Helps show why metrics are importantIllustrates the things human resource systems must do to be high-performance systemsShows that high-performance work practices usually aspire to help workers manage themselvesHighlights the measurable differences between the human resource management systems in high-performance and low-performance companies14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    Evidence-Based Human Resource ManagementEvidence-based human resource managementThe use of data, facts, analytics, scientific rigor, critical evaluation, and critically evaluated research and case studies to support human resource management proposals, decisions, practices, and conclusions14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    What Are HR Audits?HR auditAn analysis by which an organization measures where it currently stands and determines what it has to accomplish to improve its HR function14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    What Areas Should the HR Audit Cover?Roles and head countLegal issuesRecruitment and selectionCompensationEmployee relationsMandated benefitsGroup benefitsPayrollDocumentation and record-keepingTraining and developmentEmployee and internal communicationTermination and transition policies14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    Types of AuditsCompliance auditsHow well is our company complying with current federal, state, and local laws and regulations?Best practices auditsAre our recruitment practices, hiring practices, performance evaluation practices, and so on comparable to those of companies with exceptional practices?14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    Types of AuditsStrategic auditsAre our human resource management practices helping our company achieve its strategic goals by fostering the required employee behaviors and organizational outcomes?Function-specific auditsAudits of one or more specific human resource management areas, such as compensation or training and development.14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    Some Issues Prompting HR AuditsAre we in legal compliance?Are our human resource departments practices supporting our companys strategy?Are we administering our human resource management functions as productively as we might be?Did our key human resource projects or initiatives last year produce the results we intended?14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    Some Issues Prompting HR Audits (cont.)Are there issues, such as low morale or poor performance, that might respond to improved HR practices?What improvements can we institute within HR to reduce costs?How can HR improve the companys performance management process?Have we instituted policies and practices that ensure fair treatment of all employees?14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    Sample Legal Issues to Audit:Figure 14.114-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    High-Risk Compliance Areas to Audit14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    When to Audit?Threshold employee numbers (15, 20, 100) at which point various federal, state, and local regulations and laws become applicableBusiness grows to the point where line managers can no longer make their own hiring, discipline, and promotion decisions without HR managements assistanceEmployer creates or modifies an employee handbook14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    When to Audit? (cont.)New head of human resource management arrivesEmployee morale, turnover, attendance, or excessive discipline problems seem to signal the need to evaluate HR practicesCompany becomes a government contractor or a subcontractor14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    The HR Audit ProcessDecide on the scope of the auditDraft an audit teamCompile the checklists and other tools that are availableKnow your budgetConsider the legalitiesGet top management support14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    The HR Audit ProcessDevelop the audit checklistCollect the data about the company and its HR practicesBenchmark the findingsProvide feedback to your firms HR professionals and senior managementCreate action plans

    14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    Sample Metrics from SHRM Measurements Library: Figure 14.314-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    HR-to-Employee Ratios(by Organizational Size): Figure 14.214-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    Highlights of SHRM Customized Benchmarking Service: Figure 14.414-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    Strategy and Strategy-Based MetricsStrategy-based metricsMetrics that specifically focus on measuring the activities that contribute to achieving a companys strategic aims14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    Improving Productivity through HRIS Tracking Talent Management Applicant MetricsRecruitment effectiveness measurement process involves two basic steps:The employer (and vendor) decide how to measure the performance of new hiresThe Applicant Tracking System enables the employer to track the recruitment sources that correlate with superior hires14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    Two Ways to Reduce the Emphasison Day-to-Day Operational HR ActivitiesUse more technologyOutsource one or more specific services14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    Percent of Surveyed Employers that Outsource HR Functions Completely, Partially, or Not at All14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    Some Top HR Outsourcing Vendors: Figure 14.514-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    Making the Decision to OutsourceThe decisions regarding whether to outsource and what to outsource depend on three things: Employer sizeFinancial pros and consStrategic issues14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    Outsourcing Checklist14-*

    Copyright 2012 Pearson Education, Inc. Publishing as Prentice Hall

    CopyrightAll rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America.

    14-*

    *In Chapter 14 we will discuss:

    Building high-performance work systems Conducting a human resource management audit Human resource metrics and benchmarking, and Outsourcing human resource management activities*When you finish studying this chapter, you should be able to:

    Define a high-performance work system.List four characteristics of high-performance work systems.Give an example of using evidence-based management.Discuss, with examples, how to conduct an HR audit.List and explain at least five HR metrics.Explain the process you would use to select an outsourcing vendor.

    *All managers today need new ways to boost employee productivity and performance.

    For a human resource manager, this means building a high-performance work system, which is an integrated set of human resources policies and practices that together produce superior employee performance.*HR managers monitor the outcomes of their HR practices using human resource metrics, which are the quantitative measures of some human resource management yardsticks, such as employee turnover, hours of training per employee, or qualified applicants per position.*Studies show that, in terms of policies and practices, high-performance work systems differ from less productive ones.

    Table 14.1, which we see here, illustrates that high-performing companies recruit more job candidates, use more selection tests, and