HUMAN RESOURCEMANAGEMENT

Monjurul AlamSenior Manager, HR

Eastern Bank Ltd

Human Resource ManagementHuman Resource Management

Human resource management is the function performed in organizations that facilitate the most effective use of people to achieve organization or individual goal.

Competitive Challenges Facing HRM

• Globalization• Technology• Change management• Development of human capital• Market responsiveness• Cost containment

Emerging Employee Issues in HRM

• Diversity of background• Age distribution• Gender issues• Education levels• Employee rights• Privacy issues• Attitude towards work• Family concerns

Evolution of HRMEvolution of HRMThe Craft SystemThe history of HRM can be traced back to England before the Industrial Revolution, where masons, carpenters, leather workers, and other craftsmen organized themselves into guilds.

The guilds were responsible for supervision of apprentice training, production methods and quality, and working conditions.

The guilds were the predecessors of trade unions.

The Industrial RevolutionThe Industrial Revolution in the late 18th Century replaced the time-consuming hand labor with mechanical means of production.

With the rapid growth of manufacturing industry, emergence of supervisors and managers widened the gap between the workers and owners.

Scientific ManagementFredrick Taylor’s Scientific Management introduced the concept of ‘division of labor’ and advocated separate responsibilities for management and workers – management’s responsibility to plan and workers’ responsibility to execute.

He attempted to increase worker efficiency through work methods, time and motion study, and job specialization.

Industrial PsychologyHugo Munsterberg applied psychological principles towards increasing the ability of workers for performing effectively and efficiently.

The maximum well-being of the workers was the focus of industrial psychology.

Human Relations MovementElton Mayo and his associates conducted several studies on worker productivity. The studies pointed out the importance of social interaction and work group on output and satisfaction.

The human relations movement eventually became a branch in the study of Organiza- tional Behavior.

Personnel DepartmentPersonnel Departments emerged in the organizations first time in the 1920s in order to bridge the gap between the management and the workers.

But early personnel departments were only concerned with the blue-collar workers. These departments were mostly involved in recordkeeping, dealing with union troubles, arranging farewell parties, annual picnic, etc.

Human Resource ManagementDuring 1970s, ‘personnel management’ gradually evolved into ‘human resource management’ broadening its scope in the organizations.

HRM function was integrated into the organizational goals and strategies. The crucial role of HRM became gradually evident in attaining the strategic and competitive advantage of organizations for survival.

HRM TodayHRM TodayHRM ModelThe scope of HRM today has been defined by a model developed by ASTD (American Society for Training and Development):

•Training and development•Organization development•Organization/Job design•Human resource planning•Selection and staffing•Personnel research and information systems•Compensation/Benefit•Employee assistance•Union/Labor relations

HRM TodayHRM Today

HRM Model

The model suggests that these nine areas have impacts on three human resources outputs:

Quality of work lifeProductivityReadiness for change

Environmental Elements of HRMEnvironmental Elements of HRMExternal Environmental Elements

•Government•Union•Economic conditions•Labor force•Geographic location

Internal Environmental Elements

•Strategy•Goals•Organizational culture•Nature of task•Workgroup•Leadership

HR PlanningHR PlanningDefinition

The process by which an organization ensures that it has the right number and kinds of people, at the right places, at the right time, capable of effectively and efficiently completing those tasks that will help the organization achieve its overall objectives.

The process by which an organization assesses the future supply of and demand for human resources.

HR Planning ProcessHR Planning Process

Development of Plans for Action

After analyzing the demand for and the supply of future human resources, these two forecasts are compared to determine the courses of action. The discrepancy between the demand and supply forecasts may lead to two situations:

► Shortage of human resources► Surplus of human resources

Development of Plans for Action Shortage of Human Resources: the options open for an organization in order to fill up the shortage include:

Overtime Recruitment and recall Temporary employment Outsourcing

Development of Plans for Action

Surplus of Human Resources: the options open for an organization to deal with the surplus employees include:

Demotion and transfer Early retirement Layoff and termination Attrition Downsizing

Job AnalysisJob AnalysisJob

A job is a type of position held by a person within an organization.

Job Analysis

The process of systematic analysis of a job in order to determine the task, duties, and responsibilities of the job and the knowledge, skills, and abilities required to perform the job. The outputs of a job analysis include:

► Job description► Job specification

Job DescriptionThe list of tasks, duties, and responsibilities of a job.

Task: a task is a distinct work activity carried out for a distinct purpose. Duty: a duty is a number of tasks. Responsibility: an obligation to perform certain tasks.

Job Specification

The list of knowledge, skills, abilities, and other characteristics that an individual must have to perform a job.•Knowledge: an organized body of information, usually of a factual or procedural nature applied directly to the performance of a task.

•Ability: a demonstrated competence to perform an observable behavior or a behavior that results

in an observable output.

Job Specification

•Skill: a competence to perform a learned, psychomotor act, and may include a manual, verbal, or mental manipulation of data, people, or things.

•Other Characteristics: the personality factors (attitudes), aptitudes, or physical or mental traits needed to perform the job

Job AnalysisJob Analysis

Job Analysis Methods Observation Method Interview Method Questionnaire MethodDiary/Logbook Method

RecruitmentRecruitmentWhat is Recruiting?

The process of searching for and obtaining a pool of qualified candidates to fill up job vacancies.

The process begins when an organization seeks potential candidates against job vacancies and ends when the applications are submitted.

Recruitment creates a buffer between HR planning and actual selection.

Forms of Recruiting

Internal Recruiting► Initial consideration given to the current employees.

External Recruiting► Consideration given to the outside labor market.

Internal Recruiting

Sources► Promotion► Transfer and relocation► Temporary worker pool► Job posting and bidding► Skill inventory

Internal Recruiting

Advantages

Builds better employee relations. Motivates employees to perform. Encourages ambitious employees. Increases the chances of better selection as information on the performance of

candidates are readily available. Less costly than outside recruiting. Easy and faster socialization of selected

employees.

Internal Recruiting

Disadvantages

Need for strong career development program. Risk of recruiting inferior employees. ‘Political infighting’ for promotions. Possible de-motivation of those not promoted Lack of varied perspectives. Employee soldiering due to assured internal

recruiting.

External Recruiting

Sources

► Advertisements► Employee referrals► Employment agencies► Campus recruiting► Professional societies► Walk-in applicants

External Recruiting

Other Sources

► E-recruiting► Job fair► Internship► Other companies

External Recruiting

Advantages

Brings new and varied perspectives. May bring competitors’ secrets – new insights. Cheaper than training a professional. No ‘political infighting’ for promotions.

External Recruiting

Disadvantages

May not be able to obtain suitable job candidates. De-motivation of internal employees. Longer socialization time. May bring an attitude of “we used to do it in this way at XYZ Company.”

SelectionSelectionWhat is Selection?

The process by which an organization chooses from applicants the person or persons who best meet/s the selection criteria for the position/s available.

The objective of selection process is to choose the individual from the pool of candidates who can successfully perform the job. Job analysis, HR planning and recruitment are necessary prerequisites for the selection process.

Selection ProcessSelection Process

The Selection Process

► Initial screening► Completion of application form► Employment test► Comprehensive interview► Background investigation► Physical examination► Final employment decision

Compensation SystemCompensation System Objective of a Compensation System

The primary objective of an organizational com-pensation system is to establish a structure for the equitable compensation of employees basing on their jobs and their level of performance.

Compensation Determination

Deciding compensation for employees involves three aspects: Determination of pay-structure Determination of pay-level Determination of individual pay

Determination of Pay-structure• Determining the relative worth of different jobs within the organization.• Involves setting a value on each job within the organization relative to all other jobs.• Job evaluation is the approach used.

Determination of Pay-level

• Examining pay relative to employees working on similar jobs in other organizations.• Also called job-pricing.• Objective is to keep the organization competi- tive in the labor market.• Ensures external equity.• Pay survey is a major tool used in job-pricing.

Determination of Individual Pay• Examining pay relative to employees working on the same job within the organization. • Ensures internal equity.

Job EvaluationJob Evaluation What is Job Evaluation?

• Job evaluation is a systematic process of deter mining the value of each job in relation to other jobs in the organization in order to determine which jobs should be paid more than others.

Job Evaluation Methods Job ranking Job classification Point method Factor comparison

Job Ranking

• Job ranking involves arranging all jobs in an organization in a simple rank order – from the simplest to the most difficult.• Qualitative in nature.• This method is suitable for small and simple organizations having less number of jobs. • But not suitable for big and complex organi- zations having a large number of jobs. • Subjectivity and lack of definite or consistent standard is another limitation.

Job Classification

• Job classification is the process grouping jobs into different grades or classes on the basis of differences in skills, duties, responsibilities, knowledge, working conditions and other job- related factors. Then those grades of jobs are ranked by levels of difficulty or sophistication. • Qualitative in nature.• This method is quick, simple, and cheap. It is also easy to understand and communicate. • But it may lead to inappropriate grouping of some jobs and consequent feeling of inequity.

Point Method

• Point method involves breaking down jobs on the basis of certain identifiable criteria (such as skill, effort, responsibilities, etc) and then allocating points or weights to each of these criteria as per their importance. The points of each job are then added and jobs with similar point-totals are placed in similar pay grades. • Quantitative in nature.• This method is the most consistent one with least rating errors.• But it is complex, costly and time-consuming.

Factor Comparison Method

• This method involves identifying certain key jobs in the organization and then comparing them by using a universal five-factor (that is, skills, responsibilities, physical effort, mental effort, and working conditions) scale. A base rate is decided for each of the key jobs which is then allocated among the five criteria.• Quantitative in nature.• It is a step-by-step systematic method which can be tailored to meet specific needs of each organization. • But this method is also complex, costly and time-consuming.

Employee BenefitsEmployee Benefits

What are Employee Benefits?

•These are indirect and membership-based rewards offered by an organization to attract and retain employees.

•Benefits programs do not directly affect the performance of employees – but inadequate benefits lead to employee dissatisfaction.

Objectives of Benefits Program

Improve employee work satisfaction. Meet employee health and security requirements. Attract and motivate employees. Reduce employee turnover. Remain competitive in labour market.

Types of Employee Benefits

• Legally Required Benefits Social security Unemployment insurance Workers’ compensation insurance Unpaid leave of absence

• Discretionary Benefits Health care benefits Paid time off Supplemental unemployment benefits Life and long-term care insurance Retirements and pensions

What are Compensation Surveys?

• Techniques and instruments used to collect data about compensation paid to employees in:

a geographic area an industry an occupational group

• Obtaining valid and reliable information on the external wage rates is critical to creating a competitive compensation structure.

Sources of Surveys

• Pay surveys are conducted by: • Professional and consulting agencies• Trade associations• Business journals • Trade unions• Government agencies• Companies themselves

Performance Appraisal SystemPerformance Appraisal SystemPerformance Appraisal Process

A formal process in an organization whereby each employee is evaluated to determine how he or she is performing.

The process of evaluating employees on:►Employee productivity: measured in terms of efficiency and effectiveness.►Employee-created disruptions: measured in terms of accidents, absences, and tardiness.

Purposes of Performance AppraisalStrategic

►Strategic and HR planning.►Evaluating goal achievement.

Administrative►Deciding compensation and rewards.►Deciding promotion, transfer, and lay-off.►Meeting legal requirements.►Validating selection test criteria.

Developmental►Providing performance feedback.►Setting high performance goals.►Designing performance improvement programs.

Steps in Performance Appraisal Process

Establish performance standards. Set policies on who evaluates, when, and how often. Communicate performance expectations to employees. Gather employee performance data and measure actual performance. Compare actual performance with standards. Discuss the appraisal with employees. Initiate corrective actions, if necessary.

OrientationOrientationWhat is Orientation?

The process of familiarizing new employees with the organization, their work units, and their jobs.

The process of socialization by which new employees get acquainted with the organi- zational rules and regulations, norms, values, work procedures, and patterns of behavior.

Levels of Orientation

► Organizational Orientation A general orientation that presents topics of relevance and interest to all employees.

► Departmental and Job Orientation An orientation that includes issues unique to the new employee’s specific department and job.

TrainingTrainingWhat is Training? The systematic process of altering the behavior of employees in a direction that will enable them to perform their jobs and achieve organizational goals.

A formal training program is an effort by the organization to impart job-related knowledge, skills, and behaviors to the employees.

Training is related to the performance of current job and Development is related to the performance of future job.

Phases of Training

Conducting the needs assessment Designing the training program Implementing the training program Evaluating the training program

Needs Assessment

The needs assessment phase attempts to determine:

► Why training is needed► What kind of training is needed► Where it is needed► Who need it► When and how long they need it

Needs assessment involves:► Organization analysis► Task analysis► Person analysis

Needs Assessment

►Organization analysis: an examination of organizational environment, strategies, and resources to determine where the training emphasis should be placed.

►Task analysis: a review of job description and specification to determine the training areas.

►Person analysis: the determination of the specific individuals who need training.

TrainingTrainingProgram Design

Once the training needs have been deter- mined, the next step is to design the type of learning environment necessary to enhance learning.

Training design should focus on:►Instructional objectives►Trainee readiness and motivation►Principles of learning►Characteristics of instructors

Program Design

Instructional objectives: desired outcomes of a training program, which include:

► knowledge and skills to be acquired► attitudes to be developed

Trainee readiness and motivation Trainee readiness: refers to the knowledge and experience of the trainees necessary to absorb training to be conducted.

Trainee motivation: for optimum learning, trainees must feel the necessity of training and have a constant desire to learn.

Program Design

Principles of learning: following principles of learning should be kept in mind while designing a training program:

► Goal setting► Meaningfulness of presentation► Modeling► Individual differences► Active practice and repetition► Whole-versus-part learning► Massed-versus-distributed learning► Feedback and knowledge of progress► Rewards and reinforcement

Program Design

Characteristics of instructors: following is a list of desirable traits of an instructor:

► Knowledge of subject► Adaptability► Sincerity► Sense of humor► Interest► Clear instructions► Individual assistance► Enthusiasm

Program Implementation

Training Methods► On-the-job training► Apprenticeship training► Vestibule training► Off-the-job training

Program Implementation

On-the-job training: training that shows the employee how to perform the job and allows him or her to do it with the instructions of a supervisor or trainer.

► Job rotation is an example.

Apprenticeship training: A comprehensive training that combines the theoretical and practical aspects of the work required in a highly skilled occupation.

It is a combination of on-the-job and off-the-job training.

Program Implementation

Vestibule training: in this kind of training, the trainee learns the job in an environment that simulates the real working environment as closely as possible.

Off-the-training: beyond apprenticeship, vestibule training, and on-the-job training, all other training is off-the job training, whether it is conducted in the organization classrooms, vocational schools, or elsewhere.

Program Evaluation

Conducting an evaluation of training program is essential for determining its effectiveness.

The evaluation should involve determining:►Reaction: how much did the trainees like the program?►Learning: what principles, facts, and concepts were learned ?

►Behavior: did the job behavior of the trainee change due to training?

►Result: what was the result of the program in terms of factors such as reduced cost or reduced turnover?

Reward SystemReward System Organizational Rewards and Employee Motivation

Employee recognition is not just a nice thing to do for people. Employee recognition is a communication tool that reinforces and rewards the most important outcomes people create for your business. When you recognize people effectively, you reinforce, with your chosen means of recognition, the actions and behaviors you most want to see people repeat. An effective employee recognition system is simple, immediate, and powerfully reinforcing.

Classification of Rewards

• Extrinsic Vs. Intrinsic Rewards

Extrinsic Rewards: are external to the job and come from an outside source.

► Money► Promotion► Fringe benefits

Intrinsic Rewards: are the satisfactions some-one gets from the job itself.

► Pride in the job► Feeling of accomplishment► Belongingness

Classification of Rewards

•Financial Vs. Non-financial Rewards

Financial Rewards: are the rewards that enhance employee’s financial well-being.

► Direct Financial Rewards•Wages• Bonuses• Profit-sharing

► Indirect Financial Rewards• Pension plans• Paid vacations• Paid sick leaves• Purchase discounts

Non-financial Rewards: are the rewards that make the life on the job more attractive.

► Impressive job title► Desired work assignment► Decorated office► Reserved parking space► Own secretary

Classification of Rewards

• Performance-based Vs. Membership-based Rewards

Performance-based Rewards:► Commissions► Piecework pay plans► Incentives► Group bonuses► Merit pay plans

Membership-based Rewards:► Benefits and services► Insurance plans► Profit-sharing► Seniority

Characteristics of Effective Rewards

AdequateCost-effectiveEquitableBalancedFlexibleVisibleAcceptable to the employeeSecure Incentive-providing

IndustrialIndustrial Relations Relations

What is Industrial/Labour Relations?

• The continuous relationship between a defined group of employees and management.

• The relationship includes:The negotiation of a written contract concerning pay, hours, and other terms and conditions of employment.

The interpretation and administration of this contract over its period of coverage.

Types of Industrial Relations Organizations

• Craft Unions: unions that represent skilled craft workers.

• Labour/Trade Unions: unions that represent all workers–skilled, semi-skilled, and unskilled–employed along industry lines.

• Employees’ Associations: organizations that represent various groups of professional and white-collar employees in establishments or industries.

• Employers’ Associations: organizations that represent all employers in industries.

What is a Trade Union?

• A union is an organization of workers, acting collectively, seeking to promote and protect its mutual interests through collective bargaining.

Why Employees Join Unions?• Employees generally join trade unions to satisfy

needs that are important to them – including:Socialization and group membershipCommunication link to managementFair compensationGreater job securitySafe and healthy working conditions

Formation of Trade Union

• All workers in an establishment have the right to form trade unions under the provisions of IRO 1969. But no worker is allowed to become the member of more than one trade union.

• A trade union must be registered. But a trade union must have a minimum membership of 30 percent of the total number of workers employed in the establishment to qualify for registration.

Formation of Trade Union • The registration of a trade union involves an

elaborate, formal procedure.• A duly registered trade union is issued with a

certificate of registration by the Registrar.• A registered trade union is a body corporate

with a separate legal entity.• Any two or more registered trade unions may

form a federation of unions and register it under the provisions of IRO 1969.

Collective BargainingCollective Bargaining What is Collective Bargaining?

• Process by which the representatives of the employer meet and attempt to work out a contract with the representative organization of employees called the Collective Bargaining Agent (CBA).

• Collective Bargaining Agent: means the trade union of workers in relation to an establishment or industry – which is the agent of the workers in the establishment or industry in the matter of collective bargaining.

Collective Bargaining Agent

• If an establishment has only one registered trade union with its members not less than one-third of the total worker employed in the establishment – that trade union will work as the CBA.

• But if an establishment has more than one registered trade unions – one of them will be elected as CBA for a 2-year term through a secret ballot arranged by the Registrar.

Settlement of Industrial Dispute

• Industrial dispute: any dispute or difference between two parties (such as the employer and the workers) in regard to wages, working hours, working conditions, or other terms and conditions of employment.

Settlement of Industrial Dispute

• Such industrial disputes are settled through a series of instruments which include:

► Negotiation► Conciliation► Arbitration► Strike and lockout► Labour court► Labour appellate tribunal

Getting the right number of people

with the right skills, experiences, and

competencies in the right jobs at the

right time.

Engages senior management in a disciplined review of organizational talent

Guides development activities of staff Brings HR systems into alignment Assures continuity of key positions /

Avoids transition problems Assures new managers are prepared for

their jobs Focus on Organizational Effectiveness

Assessment ofKey Positions

Identification ofKey Talent

Assessment ofKey Talent

Generation ofDevelopment Plans

DevelopmentMonitoring & Review

KeyElements

Succession Planning: Key Elements

1. Assessment of Key Positions:• What are the competencies and experiences needed to qualify for each key position?

2. Identification of Key Talent:• Typically people at the top two levels of the organization and high potential employees one level below.• Identified by their management’s assessment of their performance and potential for advancement.

3. Assessment of Key Talent:• For each person on the radar screen, primary development needs are identified focusing on what they need in order to be ready for the next level.

Succession Planning: Key Elements

4. Generation of Development Plans:• A development plan is prepared for how we will help the person develop over the next year.

5. Development Monitoring & Review• An annual or semi-annual succession planning review is held to review progress of key talent and to refresh or revise their development plan.

Succession Planning: Key Elements

An HRIS, the abbreviation for Human An HRIS, the abbreviation for Human Resources Information System, is a system that Resources Information System, is a system that lets you keep track of all your employees and lets you keep track of all your employees and information about them. It is usually done in a information about them. It is usually done in a database or, more often, in a series of inter-database or, more often, in a series of inter-related databases. related databases.

Incident RecordsIncident RecordsEmployee Benefits ManagementEmployee Benefits ManagementManage Employee LeavesManage Employee LeavesImproved Evaluation ProcessImproved Evaluation ProcessPositional Assignments Positional Assignments AdministrationAdministrationBenefit Claims AnalysisBenefit Claims AnalysisManage Company Vehicles and Manage Company Vehicles and ParkingParkingControl Company EquipmentControl Company Equipment

Automatic DeductionsAutomatic DeductionsPermanent HistoriesPermanent HistoriesImport and ExportImport and ExportMultiple Employee Bank AccountsMultiple Employee Bank AccountsDetailed Employee InformationDetailed Employee InformationNew Employee TemplatesNew Employee Templates