Principles of HRM

1

Principles of

HR Management

2

Training Agenda

1. HR Management : An Overview

2. HR Planning and Recruitment

3. Employee Selection

4. Training and Development

5. Performance Management

6. Career Management

3

Human Resource

Management : An Overview

4

HR Management Cycle

Recruitment &

Selection

Training &

Development

Performance

Management

Reward

Management

Career

Management

5

HR Strategy and Business Result

Recruitment &

Selection

Training &

Development

Performance

Management

Reward

Management

Career

Management

HR

STRATEGY

Business

Strategy

Business

Result

6

Manpower Planning &

Employee Recruitment

7

Manpower Planning

Company Strategy

What staff do we

need to do the

job?

What staff is

available within

our

organization?

Is there a

match?

If not, what type of people

do we need, and how

should we recruit them?

Job Analysis

• Performance

appraisal

• Company data

banks

• Training

• Employee

management and

developmentWhat is impact

on wage and

salary program?

8

Manpower Planning

The financial

resources

available to

your

organization

Factors in Forecasting Personnel

Requirements

Projected

turnover (as a

result of

resignation and

terminations)

Quality and nature of

your employees (in

relation to what you

see as the changing

need of your

organization)

9

Technique to Determine Number of Recruits

• Study of a firm’s past employment needs

over a period of years to predict future

needs

Trend

Analysis

Ratio

Analysis

• A forecasting technique for

determining future staff needs by using

ratios between sales volume and

number of employees needed

10

Recruitment from External Resources

• Recruiting new staff from external sources will be influenced

by several factors, namely :

When the economic conditions are

relatively difficult, there will usually be

an oversupply, or the number of

applicants will much higher than the

demand. In such a case, the company

will find it relatively easier to select new

employees from the large number of

applicants.

Macro-

Economic

Conditions

of a Nation

11

When the sector is one that is

considered a ‘rare’ sector, the company

will have more difficulty in recruiting

staff for this sector. For example,

computer technology, or cellular

engineering.

Availability

of Manpower

in Desired

Sectors


12

It will tend to be easier for a company

to find and recruit the best people if

the company has a good reputation,

therefore the best fresh graduates will

flock to apply to the company.

Example : Google, McKinsey or

Microsoft.

Company

Reputation


13

• Some employers use a recruiting yield pyramid to

determine the number of applicants they must generate

to hire the required number of new employees.

• Example of Recruitment Curve:

• 1200 - Leads generated

• 200 - Candidates invited

• 150 - Candidates interviewed

• 100 - Offers made

• 50 - New hires

Recruitment Yield Pyramid

14

Recruitment Sources

Advertising (newspaper,

magazine, internet)

College

Recruitment

Recruitment Agent

(headhunter)

Recruitment

Sources

15

Employee Selection

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Basic Concept of Selection Tests

The quality of an employee selection test is determined by

three main factors, namely :

1. Criterion Validity : A type of validity based on showing

that scores on the test (“predictors”) are related to job

performance (“criterion”).

2. Content Validity : A test that is “content valid” is one in

which the test contains a fair sample of the tasks and

skills actually needed for the job in question.

3. Reliability : The consistency of scores obtained by the

same person when retested with identical or equivalent

test.

17

Some Types of Selection Test

1. Cognitive Ability Test

2. Personality Test

3. Interview

18

Cognitive Ability Test

• Cognitive Abilities Tests: Paper and pencil or

individualized assessment measures of an

individual's general mental ability or intelligence.

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Advantages of Cognitive Ability Test

• highly reliable

• verbal reasoning and numerical tests have shown high

validity for a wide range of jobs

• the validity rises with increasing complexity of the job

• may be administered in group settings where many

applicants can be tested at the same time

• scoring of the tests may be completed by computer

scanning equipment

• lower cost than personality tests

20

Disadvantages of Cognitive Ability Test

• non-minorities typically score one standard deviation

above minorities which may result in adverse impact

depending on how the scores are used in the selection

process

• differences between males and females in abilities (e.g.,

knowledge of mathematics) may negatively impact the

scores of female applicants

21

Personality Test

• Personality Tests: A selection procedure measure the

personality characteristics of applicants that are

related to future job performance.

• Personality tests typically measure one or more of

five personality dimensions: extroversion,

emotional stability, agreeableness,

conscientiousness, and openness to experience.

22

Advantages of Personality Test

• can result in lower turnover due if applicants are

selected for traits that are highly correlated with

employees who have high longevity within the

organization

• can reveal more information about applicant's abilities

and interests

• can identify interpersonal traits that may be needed for

certain jobs

23

Disadvantages of Personality Test

• difficult to measure personality traits that may not be well

defined

• responses by applicant may be altered by applicant's

desire to respond in a way they feel would result in their

selection

• lack of diversity if all selected applicants have same

personality traits

• lack of evidence to support validity of use of personality

tests

24

Interview

• Interviews: A selection procedure designed to predict

future job performance on the basis of applicants'

oral responses to oral inquiries.

25

Advantages of Interview

• useful for determining if the applicant has requisite

communicative or social skills which may be necessary for

the job

• can assess the applicant's job knowledge

• can be used for selection among equally qualified

applicants

• enables the supervisor and/or co-workers to determine if

there is compatibility between the applicant and the

employees

• allows the applicant to ask questions that may reveal

additional information useful for making a selection

decision

26

Disadvantages of Interview

• subjective evaluations are made

• decisions tend to be made within the first few minutes of

the interview with the remainder of the interview used to

validate or justify the original decision

• interviewers form stereotypes concerning the

characteristics required for success on the job

• research has shown disproportionate rates of selection

between minority and non-minority members using

interviews

• negative information seems to be given more weight

• not as reliable as tests

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Training & Development

28

Training

Need

Analysis

Training

ObjectivesTraining

Delivery

Training

Evaluation

Training Process

What are

the training

needs for

this person

and/or job?

Objective

should be

measurable

and

observable

Techniques

include on-

the-job-

training,

action

learning, etc.

Measure

reaction,

learning,

behavior,

and results

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Assessing Training Needs

Task Analysis A detailed analysis of a job to

identify the skills required, so

that an appropriate training

program can be instituted

Competency

Analysis

Careful study of competency level

to identify a deficiency and then

correct it with a training program, or

some other development

intervention.

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Competency Analysis

Required

competency

level for certain

position

Competency

Gap

Competency

Assessment

Current

competency

level of the

employee

Training and

Development

Program

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Competency Profile Per Position

1 2 3 4 5

Communication Skills

Public Speaking

Leadership

Training Need Analysis

Material Development

Training Evaluation

Communication Skills

Interview Skills

Analytical Thinking

Understand Selection Tools

Teamwork

Customer Orientation

Recruitment

Supervisor

Required Level

Required CompetencyPosition

Training &

Development

Manager

Score Required

Competency Type

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Position

Competency Requirements

Relevant Training Modules

Leadership

Leadership I

Communication Skills I

The Art of Motivating Employees

Providing Effective Feedback

SUPERVISOR

Achievement Orientation

Goal Setting Technique

Work Motivation

Planning & Organizing

Continuous Self Improevement

Managerial competency 1 2 3 4

Leadership Required Level

Actual Level

Achievement Orientation

Teamwork

Planning & Organizing

Functional competency 1 2 3 4

Mechanical Engineering

Mechanical Equipment Maintenance

Competency Profile Per Position

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Training Matrix for Competency Development

Communication Skills V

Leadership V

Teamwork V

Achievement Orientation V

Customer Focus V

Job Functional Skills V

Communication Skills V

Leadership V

Teamwork V

Achievement Orientation V

Customer Focus V

Strategic Thinking V

Problem Solving & Decision Making V

Job Functional Skills V

Position Managerial Competency

Supervisor

Manager

Pro

ductive

Com

munic

ation

Series

On B

ecom

ing

Eff

ective L

eader

1

On B

ecom

ing

Eff

ective L

eader

2

Serv

ice E

xcelle

nce

for

Custo

mer

Pro

fessio

nal

Sem

inar

Series

Achie

vem

ent

Motivation T

rain

ing

Cre

ative P

roble

m

Solv

ing

Str

ate

gic

Managem

ent

Build

ing P

roductive

Team

work

V = compulsory training

Training Title

34

Enhance Training Effectiveness

Make the

material

meaningful

Provide for

transfer to

learning

Motivate

the trainee

Training

Effectiveness

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Make the

material

meaningful

• At the start of training, provide the

trainees with a bird’s-eye view of the

material to be presented. Knowing the

overall picture facilitates learning.

• Use a variety of familiar examples when

presenting material

• Organize the material so that it is

presented in a logical manner and in

meaningful units

• Try to use terms and concepts that are

already familiar to trainees

• Use as many visual aids as possible

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Provide for

transfer to

learning

• Maximize similarity between the training

situation and the work situation

• Provide adequate training practice

• Identify each feature of the step in the

process

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Motivate

the trainee

• People learn best by doing. Try to

provide as much realistic practice as

possible

• Trainees learn best when correct

response on their part are immediately

reinforced.

• Trainees learn best when they learn at

their own pace. If possible, let trainees

pace themselves.

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Type of Training Program

Formal course

OFF THE JOB

Simulation

Wilderness Trip

• Does not interfere with job

• Provides for fact learning

• Helps transfer of learning

• Creates lifelike situations

• Builds teams

• Builds self-esteem

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Type of Training Program

Job instruction

training

ON THE JOB

Apprenticeship

training

Job rotation

Mentoring

• Facilitates transfer of learning

• Does not require separate facilities

• Does not interfere with real job performance

• Provides extensive training

• Gives exposure to many jobs

• Allows real learning

• Is informal

• Is integrated into job

40

Evaluation of Training Effectiveness

Level 1 - Reaction

Level 2 - Learning

Level 3 – Behavior

Application

Level 4 – Business

Impact

Four Levels

of Training

Effectiveness

41


Test the trainees to determine if

they learned the principles,

skills, and facts they were to

learn.

Evaluate trainees’ reactions to

the program. Did they like the

program? Did they think it

worthwhile?

Level 1 -

Reaction

Level 2 -

Learning

42


What final results were achieved in terms of the

training objectives previously set? Did the number

of customer complaints about employee drop? Did

the reject rate improve? Was turnover reduced,

and so forth.

Ask whether the trainees’ behavior on the job

changed because of the training program. For

example, are employees in the store’s complaint

department more courteous toward disgruntled

customers than previously?

Level 3 –

Behavior

Application

Level 4 –

Business

Impact

43

Employee

Performance Management

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Why Performance Appraisal?

• Appraisal provide information upon which promotion and

salary decision can be made.

• Appraisal provide an opportunity for a manager and

his/her subordinates to sit down and review the

subordinate’s work-related behavior, and then develop a

plan for corrective action.

• Appraisal provide a good opportunity to review the

person’s career plans in light of his/her exhibited

strengths and weaknesses.

45

Performance Management Cycle

Performance

Planning

(Setting

Performance

Targets)

Regular

Review and

Monitoring

Feed back

Corrective

Action

Performance

Appraisal and

Evaluation

• Training &

Development

Plan

• Salary/Bonus

Adjustment

• Career

Development

46

Performance Management Cycle

Defining

Performance

Standard/

Targets

Appraising

Performance

Providing

Feedback for

Development

1. Defining the performance standards

means making sure that you and your

subordinate agree on his/her duties and

targets that you expect

2. Appraising performance means

comparing your subordinate’s actual

performance to the standard/targets set

in step one.

3. Providing feedback means discussing

plans for any development that is

required.

47

Problems in Performance Appraisal

Lack of

standards

Irrelevant or

subjective

standards

Poor

measures of

performance

Poor

feedback to

employee

Negative

communication

Failure to

apply

evaluation

data

Common Performance Evaluation Problems

48

Bias in the Appraisal Process

Halo

Effect

The "halo" effect occurs when a supervisor’s

rating of a subordinates on one trait biases the

rating of that person on other traits

Central

Tendency

A tendency to rate all employees the same

way, such as rating them all average

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Leniency

The problem that occurs when a supervisory

has a tendency to rate all subordinates either

high or low

BiasThe tendency to allow individual differences

such as age, race, and sec affect the appraisal

rates these employees receives.

Bias in the Appraisal Process

50

Performance

appraisal

elements

has two main

categories: 2. Performance Result:

Hard or quantitative aspects

of performance (result)

1. Competencies: It

represents soft or qualitative

aspects of performance

(process)

Performance Appraisal Element

51

1. Competencies Score

2. Performance Result

Score

Overall Score

Will determine the employee’s

career movement, and also

the reward to be earned

Performance Appraisal Element

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Element # 1 : Competencies

Basic Intermediate Advanced Expert

Actively listens, and clarifies

understanding where required, in

order to learn from others.







Actively listens, and clarifies understanding

where required, in order to learn from others.

Empathise with audience and

formulates messages accordingly.





Empathise with audience and formulates

messages accordingly.

Shares resources and information. Shares resources and information. Shares resources and information. Shares resources and information.

Responds promptly to other team

members’ needs.

Balances complementary strengths

in teams and seeks diverse

contributions and perspectives.

Actively builds internal and external

networks.

Builds internal and external networks and uses

them to efficiently to create value.

Involves teams in decisions that

effect them.

Uses cross functional teams to draw

upon skills and knowledge

throughout the organization.

Uses cross functional teams to draw upon

skills and knowledge throughout the

organization.

Encourages co-operation rather than

competition within the team and with

key stakeholders.

Builds and maintains relationships

across The company.

Drives and leads key relationship groups

across The company.

Manages alliance relationships through

complex issues such as points of competing

interest.

Ensures events and systems, eg IT, for

collaboration are in place and used.

Draws upon the full range of relationships

(internal, external, cross The company) at

critical points in marketing and negotiations.

Competency : Collaboration

53

No. Main Performance Target Target to be

Achieved

1 Conduct an assessment of the All employees submit their performance assessment form

employee's performance on time

2 Improve the system for Target : completed 100 %

performance assessment in November 2008

3 Conduct training activities Target : to conduct 6 training modules

in one year

4 Carry out on the job training Target : 90 % of the total employees

activities who attend the training

experience an increase

in skill and knowledge

Element # 2 : Performance Results

Target should be measurable and

specific

54

Employee Career

Management

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Career Planning and Development

Providing employees

the assistance to form

realistic career goals

and the opportunities

to realize them

Career

Planning &

Development

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Entry Level

First Line

Middle

Management

Senior

Management

Top

Management

Join Company 22 years old

Supervisor/Ass. Manager 26 - 29 years old

Managers 29 - 35 years old

GM/Senior Managers 35 - 45 years old

CEO/BOD 45 - 55 years old

Typical Career movement

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Career Stage

Trial Stage The period from about age 25 to 30 during

which the person determines whether or

not the chosen field is suitable and if it is

not, attempts to change it.

Stabilization

Stage

The period, roughly from age 30 to 40,

during which occupational goals are set

and more explicit career planning is made

to determine the sequence for

accomplishing goals

58

Mid career

Crisis Stage

The period occurring between the mid-

thirties and mid-forties during which people

often make a major reassessment of their

progress relative to their original career

ambitions and goals

Maintenance

Stage

The period form about ages 45 to 65 during

which the person secures his or her place

in the world of work

Career Stage

59

Decline Stage The period during which many people are

faced with the prospect of having to accept

reduced levels of power and responsibility.

Career Stage

60

Career Anchors

Career Anchor :

A concern or value that someone will not give up if

choice has to be made

Career anchors, as their name implies, are the

pivots around which a person’s career swings; a

person becomes conscious of them as a result of

learning about his or her talents and abilities.

61

Five Career Anchors

Technical/

Functional

Career Anchor

Managerial

Competence as a

Career Anchor

Creativity as a

Career Anchor

Autonomy and

Independence as

Career Anchor

Security as a

Career Anchor

62

Five Career Anchors

Technical/

Functional

Career Anchor

• People who have a strong

technical/functional career anchor

tend to avoid decisions that would

drive them toward general

management.

• Instead, they make decisions that will

enable them to remain and grow in

their chosen technical or functional

field

63

Five Career Anchors

Managerial

Competence

• People who show strong motivation

to become managers

• Their career experience enables

them to believe that they have the

skills and values necessary to rise to

such general management position

64

Five Career Anchors

Creativity• People who go on to become

successful entrepreneurs

• These people seem to have a need

to build or create something that is

entirely their own product – a product

or process that bears their name, a

company of their own, or a personal

fortune that reflects their

accomplishments.

65

Five Career Anchors

Autonomy and

Independence

• People who are driven by the need to

be on their own, free from the

dependence that can arise when a

person elects to work in a large

organization.

• Some of these people decide to

become consultants, working either

alone or as part of relatively small

firm. Others choose to become

professors, free-lance writers, or

proprietors of a small retail business.

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Five Career Anchors

Security• People who are mostly concern with

long-run career stability and job

security.

• They seem willing to do what is

required to maintain job security, a

decent income, and a stable future in

the form of a good retirement

program and benefits.

67

Career Management and the First

Assignment

• Factors to keep in mind about the important first

assignment, include :

1. Avoid reality shock (reality shock refers to the result

of a period that may occur at the initial career entry

when the new employee’s high job expectations

confront the reality of boring, unchallenging jobs.

2. Provide challenging initial jobs

3. Provide realistic job preview in recruiting

4. Be demanding

68

Career Management and the First

Assignment

5. Provide periodic job rotation

6. Provide career-oriented performance appraisals

7. Encourage career-planning activities

69

Recommended Further Readings

1. Gary Dessler, Human resource Management, Prentice Hall

2. Susan Jackson and Randall Schuler, Managing Human Resource : A

Partnership Perspective, South-Western College Publishing

70

End of Material

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