Skript human resource management

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Fachhochschule Ludwigshafen am RheinProf. Dr. Jutta Rump

Human Human ResourceResourceManagementManagement

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Fachhochschule Ludwigshafen am RheinProf. Dr. Jutta RumpContents

Human Resource Management – an Overview1. Definition2. The Functional Areas of Human Resource Management3. Protagonists of HRM4. The Organization of Human Resource Management

4.1 Human Resource Management in Small Businesses4.2 Human Resource Management in Medium-Sized Firms4.3 Human Resource Management in Large Firms4.4 Outsourcing4.5 Shared Service Center

5. The Internal and External Environment of Human Resource Management

6. Some Ins and Outs of HRM

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Fachhochschule Ludwigshafen am RheinProf. Dr. Jutta RumpJob Analysis

1. Definition2. Job Analysis Methods3. Job Description4. Job Specification

Human Resource Planning1. Definition2. The Human Resource Planning Process3. Human Resource Forecasting Techniques4. The Quantitative Comparison of Requirements and Availability5. The Qualitative Comparison of Requirements and Availability6. Qualification ProfilSome Ins and Outs of HRM

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Fachhochschule Ludwigshafen am RheinProf. Dr. Jutta RumpRecruitment

1. Definition2. Alternatives to Recruitment3. Environment of Recruitment4. The Recruitment Process

4.1 Recruitment Sources4.2 Recruitment Methods4.3 Internet Recruiting4.4 Selection

4.4.1 Definition4.4.2 The Selection Process

Downsizing

1. Definition2. Reasons for Downsizing

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Fachhochschule Ludwigshafen am RheinProf. Dr. Jutta RumpCompensation and Benefits

1. Definition2. Components of a Total Compensation Program3. Direct Financial Compensation

3.1 Equity in Direct Financial Compensation3.2 Factors of Individual Direct Financial Compensation3.3 Job Pricing3.4 Executive Compensation

4. Indirect Financial Compensation4.1 Measures of Indirect Financial Compensation4.2 Profit Sharing

5. Nonfinancial Compensation5.1 The Job as a Total Compensation Factor5.2 The Job Environment as a Total Compensation Factor

6. Cafeteria Compensation

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Fachhochschule Ludwigshafen am RheinProf. Dr. Jutta RumpHuman Resource Development

1. Introduction2. Definition of Human Resource Development3. The Purpose of HRD4. The Importance of Change Concerning HRD5. Training and Development

5.1 Definition5.2 The Training and Development Process5.3 Special Subjects of Training and Development

5.3.1 Management Development5.3.2 Orientation5.3.3 Vocational Training

6. Career Planning and Career Development

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Fachhochschule Ludwigshafen am RheinProf. Dr. Jutta Rump6.1 Definition

6.2 Career Security / Employability6.3 Factors Influencing Career Planning6.4 Career-Impacted Life Stages6.5 Individual Career Planning6.6 Organizational Career Planning6.7 Career Paths6.8 Career Development6.9 Career Planning and Development Methods

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Fachhochschule Ludwigshafen am RheinProf. Dr. Jutta Rump7. Performance Appraisal

7.1 Definition7.2 Uses of Performance Appraisal7.3 The Performance Appraisal Process7.4 Appraisal Criteria7.5 Responsibility for Appraisal7.6 Requirements7.7 Performance Appraisal Methods7.8 Problems in Performance Appraisal

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Human Human ResourceResourceManagementManagement

-- An An OverviewOverview --

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1. Definition

Human resource management deals with the availability of human resources and the efficiency of the personnelplacement. There are several functional areas beingassociated with effective human resource management:

-Job analysis- Human resource planning- Recruitment and selection- Human resource development- Compensation and benefits- Downsizing

The main purpose of human resource management is to create and to keep the balance between the firm‘s goals and the interests of the employees.

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2. The Functional Areas of Human Resource Management

Job analysis is the systematic process of determining the skills, dutiesand knowledge required for performing jobs in an organization. Itimpacts on human resource planning, recruitment, and human resourcedevelopment.

Human resource planning is the process of systematically reviewinghuman resource requirements to ensure that the required numbers of employees with the required skills are available when needed.

Recruitment is the process of attracting qualified individuals and encouraging them to apply for work.

Compensation and benefits provide employees with rewards for theircontributions to meeting organizational goals.

Downsizing is a process of reducing the numbers of employees.

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Human resource development is a major HRM function thatconsists not only training and development but also individual careerplanning, career development and performance appraisal.

Training is designed to provide learners with knowledge and skills needed for their present job.

Development involves learning that goes beyond today‘s job, ithas a more long-term focus.

Career planning is an ongoing process whereby an individualsets career goals and identifies the means to achieve them.

Career development is a formal approach used by theorganization to ensure that people with proper qualifications and experiences are available when needed.

Through performance appraisal, employees are evaluated to determine how well they are performing their assigned tasks.

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3. Protagonists of HRM

There are several protagonists performing human resourcemanagement tasks:

The human resource manager

The line manager

The top management

The workers‘ council (especially in Germany)

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The Human Resource Manager

Various classifications occur within the human resource profession.

Human resource executive: An executive is a top-level managerwho reports directly to the corporations‘s chief executive officer(CEO) or to the head of a major division.

Human resource generalist: A generalist performs tasks in a varietyof human resource-related areas. The generalist is involved in several or all human resource management functions.

Human resource specialist: A specialist is typically concerned withonly one of the functional areas of human resource management.

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4. The Organization of Human ResourceManagement

The organization structure of human resource managementdepends often on the company‘s size. As firms grow and becomemore complex, the human resource functions also become morecomplex.

The basic purpose of human resource management remains thesame, the difference is in the approach which is used to accomplish its objectives.

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4.1 Human Resource Management in Small Businesses

Small businesses seldom have a formal human resource unit and HRM specialists. The top management and the line managers handle human resource functions.

Some aspects of human resource functions may actually be moresignificant in smaller firms than in larger ones. For example, a staffing mistake might be harmful and may cause the business to fail.

Manager / Owner

Sales Operations Finance

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4.2 Human Resource Management in Medium-Sized Firms

As a firm grows a separate staff function may be required to coordinate human resource activities. In a medium-sized firm theperson chosen to fill this role is expected to handle most of thehuman resource activities.

President

Sales Manager OperationsManager

FinanceManager

Human ResourceManager

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4.3 Human Resource Management in Large Firms

When the firms‘s human resource function becomes too complexfor one person, separate sections are often created and placedunder a human resource executive.

President

Vice PresidentHuman

Resource

Vice PresidentMarketing /

Sales

Vice PresidentOperations

Vice PresidentFinance

Manager HR

Planning

Manager Recruitment

Manager HRD

Manager Compensation /

Benefits

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4.4 Outsourcing

Outsourcing is the process of transfering the responsibility for an area of services and its objectives to an external provider. Byoutsourcing certain projects, companies can save time and resources and redirect their energy to more strategic issues.

Manager Human

Resource

Executive Development

ExecutiveRecruiting

HR Development

HR Recruitment

OutsourcedOutsourced

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4.5 Shared Service Center

A shared service center takes routine, transaction-based activitiesdispersed throughout the organization and consolidates them in one place.

For example, a company with 20 business units could consolidatethe routine HR tasks and perform them in one location.

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5. The Internal and External Environmentof Human Resource Management

Legal Considerations Society Economy Technology

Firm‘s Mission and Policies

Corporate Culture

Management Style

Employees and theirCapabilities and Attitudes

Informal Organization

Other Units of theOrganization

Formal Organization

Human Resource

Management

Labor Market Unions Competition Customers Shareholder

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6. Some Ins and Outs of HRM

Out: Job titles and labelsIn: Everyone is a businessperson, an owner of a business processand a

president of his / her job

Out: Chain of commandIn: Self-management, proactivity, personal responsibility, initiative

Out: Stability, order, structure better be safe than sorryIn: Flux, disorder, risk, better be sorry than safe

Out: Good citizenship, wait for someone to decide your fate, work in the

same organization for a long timeIn: Make a difference, learn from mistakes, change the employers, be flexible


Job AnalysisJob Analysis

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1. DefinitionJob analysis is the systematic process of determining a job‘s dutiesand responsibilities, its relation to other jobs, skills and knowledgerequired and working conditions under which it is performed.

A job consists of a group of tasks which make sure that the organizationachieves its goals.

A position is the collection of tasks and responsibilities performed byone person. There is a position for every person in an organization.

Job analysis is used to prepare job descriptions and job specifications.

The job description is a document that provides information regardingthe task, duties and responsibilities of the job.

The minimum acceptable qualifications that a person should possess in order to perform are listed in the job specification.

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Tasks Responsibilities Duties

Knowledge Skills Abilities

J ob

An a

lysi

s Job Description

Job Specification

HR Planning

Recruitment

Selection

Training and Development

Performance Appraisal

Downsizing

Compensationand Benefits

...

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2. Job Analysis MethodsThere are several methods of job analysis:

Questionaires

Observation

Interviews

Employee recording

Usually an analyst does not use one job analysis method exclusively. A combination of methods is often more appropriate.

Regardless of the methods taken the analyst should learn as much as possible about the job. It is necessary that the supervisor introduces theanalyst to the employees and explains the purpose of the job analysis. Trust and confidence ist an essential requirement for the process of job analysis.

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3. Job Description

The job description is a document that provides informationregarding the task, duties and responsibilities of the job. It has to be relevant and accurate.

Components of the job description are

- major duties performed,- percentage of time devoted to each duty,- performance standards to be achieved,- Working conditions and possible hazards,- supervision and subordination,- the machines and equipment used on the job.

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4. Job Specification

The job specification is a document containing the minimumacceptable qualifications that a person should possess in order to perform a particular job. Items are requirements concerning skills, knowledge, abilities, experience ...

Criteria are for example

- knowledge of business- customer orientation- interpersonal skills / team player- ability to influence others- confidentiality- planing, organizing and time management- written and oral communication...


Human Human ResourceResourcePlanningPlanning

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1. DefinitionHuman resource planning is the process of systematically reviewinghuman resoure requirements to ensure that the required numbers of employees with the required skills are available when and where they areneeded.

Human resource planning includes four factors:

Quantity: How many employees do we need?

Quality: Which skills, knowledge and abilities do we need?

Space: Where do we need the employees?

Time: When do we need the employees? How long do we need them?


2. The Human Resource PlanningProcess

Strategic Planning

Human Resource Planning

Forecasting Human Resource

Requirements

ComparingRequirements and

Availability

Forecasting Human Resource

Availability

Demand = Supply

No Action

Surplus of workers

Restricted Hiring, Reduced Hours, Early Retirement,

Layoffs, Downsizing

Shortage of workers

Recruitment

Selection

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A requirement forecast is an estimate of the numbers and kinds of employees the organization will need at future dates in order to realizeits goals. Before human resource requirements can be projected, thedemand for the company‘s goods and services must be forecasted first. Forecasting requirements provide managers with the means of estimating how many and what types of employees will be required.

Availability forecast is an estimate of the numbers and kinds of employees the organization will have got at future dates. Theavailability forecast is a process of considering incomings and outgoings during the planning period.

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3. Human Resource Forecasting Techniques

Forecasting techniques include

zero-base forecasting (zero-base forecasting is a method for estimating future employment needs using the organization‘s current level of employment as the starting point. Vacant positionsare not automatically filled. The filling has to be justified.),

the bottom-up approach (the bottom-up approach is a method beginning with the lowest organizational units. Each level forecasts ist requirements),

the use of mathematical models,

simulations.

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4. Quantitative Comparison of Requirments and Availability

Availability in t0

+ estimated incomings during the planning period- estimated outgoings during the planning period

Availability in tx- Requirments in tx

Balance

Positive balance: DownsizingNegative balance: Recruitment and / or human resource development

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5. Qualitative Comparison of Requirementsand Availability

Required Skills, Know-ledge and Abilities

• Today

• In Future

Available Qualifications

• Today

• In Future

Requirements > Qualifications: Human resource development, job rotation, job reduction

Requirements > Qualifications: Promotion, transfer, job enlargement, job enrichment, organization development

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6. Qualification Profil

The qualification profil is a document containing qualificationswhich a person possesses.

In order to check the aptitude the job specification and thequalification profil are compared.

What do we have

What will we have

What do we need

What will we need


RecruitmentRecruitment

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1. Definition

Recruitment is the process of attracting individuals

- just in time, - in sufficent numbers and - with appropriate qualifications

and encouraging them to apply for jobs.

Identifying productive sources of applicants and using suitablerecruitments methods are essentials to maximize recruitingeffectiveness and efficiency.

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2. Alternatives to Recruitment

Even when human resource planning indicates a need foradditional employees, a company may decide against increasingthe size of its workforce.

Alternatives to recruitment include

- outsourcing,- contingent workers,- employee leasing and- overtime.

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3. Environment of Recruitment

External environmentLabor Market Conditions- Quality- Quantity

Legal Considerations

Corporate Image

Internal environmentHuman Resource Planning

Promotion Policies: - Promotion from within- or a policy of fillingpositions from outside theorganization

The Firm‘s Knowledge of Employees

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4. The Recruitment Process

Human Resource Planning

Alternatives to Recruitment

Recruitment

Internal Sources External Sources

Internal Methods External Methods

Selection

Recruited Individuals


4.1 Recruitment Sources

Internal RecruitmentSources

Employees

External Recruitmentsources

High Schools

Vocational Schools

Colleges and Universities

Competitors and OtherFirms

The Unemployed

Older Individuals

Self-employed Workers

Normally internal recruitmenttakes priority over externalrecruitment. Exceptions are:

- to fill entry-level jobs- to acquire skills notpossessedby current employees

- to obtain employees withdifferent backgrounds to provide a diversity of ideas.


4.2 Recruitment Methods

External Recruitment Methods

Advertising

Private and Public Employment Agencies

Executive Search Firms

Job Fairs

Internships

Employee Referrals

Event Recruiting

Open Houses

Sign-on Bonuses

Internal RecruitmentMethods

Job Posting: Job posting is a procedure for informing theemployees that a job openingexists.

Job Bidding: Job bidding is a technique that permitsemployees who believe thatthey possess the requiredqualifications to apply for a posted job.

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4.3 Internet Recruiting

The requirements for effective Internet recruiting are

- to find Internet employment sites, - to establish a budget, - to develop an Internet Web site that is up-to-date and informative, - to write effective online ads, - to experiment with various advertising approaches, - to monitor both traditional and Internet advertisement, - to experiment with several Web sites and - become a sleuth on the Internet.

In addition, do not neglect traditional recruiting methods.

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4.4 Selection

4.4.1 DefinitionThe purpose of the selection is to identify and employ the best-qualified individuals. Selection is the process of choosing from a group of applicants the individual best suited for a particular position.

There are several factors influencing the selection:

- Legal considerations- Labor market conditions- Type of organization (Private, governmental or not for profit)- Speed of decision making- Organizational hierarchy

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4.4.2 The Selection Process

PreliminaryInterview

Review of Applications

SelectionTests

EmploymentInterviews

New Employee

PhysicalExamination

SelectionDecision

Referenceand Background Checks

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There are severalpreliminary interviews:

- Telephone interview- Computer interview - Videotaped interview



SelectionTests


New Employee

PhysicalExamination

SelectionDecision


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Fachhochschule Ludwigshafen am RheinProf. Dr. Jutta RumpAn application should

include

- name,- address,- education,- work history, - certificates and- references.



SelectionTests


New Employee

PhysicalExamination

SelectionDecision


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Employment tests includecognitive aptitude tests,psychomotor abilities tests, job-knowledge tests, work-sample tests, vocationalinterest tests, personality testsand drug and alcohol tests.



SelectionTests


New Employee

PhysicalExamination

SelectionDecision


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Types of interviewsare:

- unstructuredinterviews,- structured interviews,- behavioral interviews

There are severalmethods of interviewing:

one-on-one interviewgroup interviewboard interviewstress interviewassessment center

The employmentinterview is a goal-oriented conversationin which interviewerand applicantexchangeinformation.



SelectionTests


New Employee

PhysicalExamination

SelectionDecision


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SelectionTests


New Employee

PhysicalExamination

SelectionDecision


Personal reference checks may provideadditional information about the applicant and allow verification. An effective and comprehensive background investigationrelates to the provious employment, education, personal references, criminalhistory, credit history ...

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SelectionTests


New Employee

PhysicalExamination

SelectionDecision


The selection decision is when the final choice is made from amongthose who are still in the race after the Interview information, referencechecks, background investigations are evaluated.

The individual with the best overall qualification may not be hired. Theperson whose qualifications most closely conform to the requirementsshould be selected.

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SelectionTests


New Employee

PhysicalExamination

SelectionDecision


The physical examination must bedirectly relevant to the job requirements. The purpose of the physical examinationis to determine whether the applicant isphysically capable of performing thetasks.

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SelectionTests


New Employee

PhysicalExamination

SelectionDecision


The selection resultsshould be madeknown to both thesuccessful and theunsuccessfulcandidates as soonas possible.

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DownsizingDownsizing

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1. Definition

Downsizing is the process of reducing the surplus of employees.

If a surplus of employees is projected by the human resourceplanning, ways must be found to reduce the numbers of workers. There are several ways of downsizing:

Restriced hiring

Reduced hours

Early retirement

Non-prolongation of limited employment contracts

Non-prolongation of leasing contracts

Outplacement

Layoffs

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Restriced hiring: When a firm implements a restricted hiring policy, it reduces the workforce by not replacing employees who leave. New workers are hired only when the overall performance may beaffected.

Reduced hours: Instead of working 40 hours a week, themanagement decides to cut each employee‘s time to 30 or 20 hours. This cutback does not normally apply to the management level.

Early retirement: Older employees (older than 58) have thepossibility to retire at the age of 58 without substantial financialdisadvantages.

Outplacement: The employer helps the employee to find a new job.

Layoffs: The employee is dismissed. He / she is no longeremployed. Normally layoffs base on a combination of seniority, productivity and ability.

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2. Reasons for Downsizing

Management Faults

Reorganization

Reengineering

Rationalization and Optimalization

Technical Progress

Closing or Relocation

Merger

Change of Demands

Ecomonic Trends

...


CompensationCompensation and and BenefitsBenefits

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1. Definition

Compensation is the total of all rewards which employees get in returnfor their services.

Direct financial compensation consists of the pay that a personreceives in the form of wages, salary, bonuses and commissions.

Indirect financial compensation (benefits) are all financial rewards thatare not included in direct compensation. These are for example insuranceand other programs for health, safety, security and general welfare.

Nonfinancial compensation consists of the satisfaction that a personreceives from the job itself or from the psychological and/or physicalenvironment in which the person works.

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2. Components of a Total CompensationProgram

Compensation

Financial Nonfinancial

Direct

-Wages-Salaries-Com-missions

-Bonuses

Indirect

-UnemploymentInsurance-Health Benefits-Pension Insurance Fund-Retirement Plans-Workers‘ Compensation-Payment for Time Not Worked

-Employee Services

The Job

-Skill Variety-Task Identity-TaskSignificance

-Autonomy-Feedback

Job Environment

-Sound Policies-CompetentEmployees

-Congenial Co-workers

-AppropriateStatus Symbols

-ComfortableWorkingConditions

-WorkplaceFlexibility

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3. Direct Financial Compensation

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3.1 Equity in Direct Financial Compensation

Equity – in the context of financial compensation – means fair pay treat-ment for employees. A fair days work for a fair days pay.

External equity exists when a firm‘s employees are paid comparable to workers who perform similar job in other firms.

Internal equity exists when employees are paid according to the relative value of their job within the same organization.

Team equity exists when more productive teams are rewarded more thanless productive teams.

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3.2 Factors of Individual Direct FinancialCompensation

The Organization

IndividualFinancial

Compensation

The Labor MarketThe Employee

The Job

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Organizational factors that should be considered includecompensation policies, organizational politics and the abilityto pay. This contains the decision to be a pay leader, payfollower or to strive for an average position in the labormarket.

The Organization

IndividualFinancial

Compensation


The Job

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IndividualFinancial

Compensation

The Organization

Factors that should beconsidered include

- unemployment rate- wage and salarysurvey, - cost of living, - labor unions, - the economy and - labor law / employmentlegislation.


The Job

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The Organization

IndividualFinancial

CompensationThe Labor MarketThe Employee

The Job

The organization pays for the value it attaches to certain duties, responsibilities and other job-related factors. Management techniques utilized for determining a job‘s relative worth includejob analysis, job description and job evaluation.

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The factors related to the employee include performance-based pay(merit pay, variable pay, skill-based pay, competency-based pay), seniority, experience, membership in the organization, potential, political influence...

The Organization

IndividualFinancial

CompensationThe Labor MarketThe Employee

The Job

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3.3 Job Pricing

Placing a monetary value on the worth of a job is called job pricing. It takes place after the job has been evaluated and the relative valueof each job in the organization has been determined.

Firms often use pay grades and pay ranges in the job pricing process.

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3.4 Executive Compensation

In determining executive compensation, firms typically prefer to relatesalary growth for the highest-level managers to overall corporateperformance, including the firm‘s market value. For the nextmanagement tier, they tend to integrate overall corporate performancewith market rates and internal considerations to come up withappropriate pay. For lower-level managers, salaries are oftendetermined on the basis of market rates, internal pay relationship and indivdiual performance. In general the higher the managerial position, the greater the flexibility managers have in designing their jobs.

Executive compensation often has several elements:

- Base salary- Short-term incentives or bonuses- Long-term incentives and capital appreciation- Perquisites (perks)

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4. Indirect Financial Compensation

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4.1 Measures of Indirect Financial Compensation

Unemployment insurance: If employees lose their jobs, they receivean unemployment compensation which depends on their last salaries / wages and on the length of continuous employment.

Health benefits: Heath benefits include health care, dental care and sometimes vision care.

Pension insurance fund: In Germany every employee has to pay a percentage in statutory pension insurance fund. At the age of 65 he / shegets the retirement benefits.

Retirement plans: The employee pays voluntarily a part of his incomein a retirement or savings fund. At the age of 60 or 65 he or she gets an amount of retirement income which depends on the investment success.

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Disability insurance: The disability insurance protects employeesagainst loss of earnings resulting from total disability.

Workers‘ compensation: This benefit provides a degree of financialprotection for employees who incur expenses resulting from job-related accidents or illnesses.

Payment for time not worked: This includes rest periods, coffeebreaks, lunch periods, cleanup time, travel time, paid vacations, sickpay, military duty, civic duties, bereavement time...

Employee services: Employee services are relocation benefits, childcare, educational assistance, food servies and financial services ( forexample loans)

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4.2 Profit Sharing

Profit sharing is a compensation plan that results in the distribution of a predetermined percentage of the firm‘s profits to employees. Manycompanies use this type of compensations plans to integrate theemployees‘ interests with those of the firm.

Gain sharing is a special form of profit sharing. Gain sharing plans aredesigned to bind employees to the firm‘s performance by providing an incentive payment based on the improved company performance. Improved performance can take the form of increased productivity, increased customer satisfaction, lower costs...

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5. Nonfinancial Compensation

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5.1 The Job as a Total CompensationFactor

Some jobs can be so exciting, that the employee can hardly waitto get to work each day. A person in this type of job would notswap his or her employment with anyone in the world.

Most of us spend a large part of our lives not on the beach, butworking.When work is a drag, life may not be very pleasant.

In order to achieve motivation by the job, the job has to containfive dimensions:

- Skill variety- Task identity- Task significance- Autonomy- Feedback

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5.2 The Job Environment as a Total Compensation Factor

Employees can draw satisfaction not only from their work but also fromthe job environment. The job environment includes

working atmosphere and congenial co-workers,

competent employees,

appropriate status symbols and

working conditions.

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Working conditions achieve satisfaction and motivation especiallywhen workplace flexibility exists. Workplace flexibility is a key factorin attracting and retaining talented and qualified employees.

Programs of workplace flexibility include

flextime,

a compressed workweek,

job sharing,

telecommuting,

part-time work,

modified retirement.

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5.3 Cafeteria Compensation

Cafeteria compensation plans permit flexibility in allowing eachemployee to determine the compensation package which best satisfieshis or her particular needs. The rationale behind the cafeteria plans isthat employees have individual needs and preferences.

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Human Human ResourceResourceDevelopmentDevelopment

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1. Introduction

In every market customers are demanding higher quality, lower costs, and faster cycle times. To meet these requirements, firms mustcontinuously improve their overall performance. Rapide advances in technology and improved processes have been important factors in helping businesses. However, the most important competitiveadvantage is the workforce and especially the competency, knowledge and skills. The function / functional area dealing withcompetency, knowledge and skills is Human Resource Management.

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Fachhochschule Ludwigshafen am RheinProf. Dr. Jutta Rump2. Definition of Human Resource

Development (HRD)Improved performance is the buttom-line purpose of HRD. HRD is a major HRM function that consists not only training and development but also individual career planning, career development and performance appraisal.

Training is designed to provide learners with knowledge and skillsneeded for their present job.

Development involves learning that goes beyond today‘s job, it has a more long-term focus.

Career planning is an ongoing process whereby the individual setscareer goals and identifies the means to achieve them.

Career development is a formal approach used by the organization to ensure that people with proper qualifications and experiences areavailable when needed.

Through performance appraisal, employees are evaluated to determine how well they are performing their assigned tasks.

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3. The Purpose of HRD

Availability of qualified employees

Development of knowledge, skills and experience

Promotion of prospective managers and talented youngemployees

Improvement of leadership

Enhancement of motivation

Guarantee of employability

Decrease of fluctuation rate

Increase of flexibility

...

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4. The Importance of Change concerningHRD

Another basic purpose of HRD is to anticipate change and to respondproacticely to it.

The most prominent changes affecting HRD are the following:

Changes in organization structure caused by mergers, acquisitions, rapid growth, downsizing, and outsourcing.

Changes in technology and the need for more highly skilled workers.

Changes in educational level of employees.

Changes in human resources, creating a diverse workforce consistingof many groups.

Competitive pressures necessitating flexible courses and just-in-time and just-what‘s-needed training.

Increased emphasis on learning organizations and human performance management.

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5. Training and Development

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5.1 Definition

Training is designed to provide learners with knowledge and skillsneeded for their present job.

Development involves learning that goes beyond today‘s job, it has a more long-term focus. It prepares employees to keep pace with theorganization as it changes.

Training and development acitivities have the potential to alignemployees of a company with its corporate strategies.

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5.2 The Training and Development Process

1. DeterminingT&D Needs

2. EstablishingSpecificObjectives

3. SelectingT&D Methods

5. EvaluatingT&D Programs

4. ImplementingT&D Programs

External Environment

Internal Environment

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Determining Training and DevelopmentNeeds

T&D needs may be determined by conducting analyses on severallevels. From overall organizational perspective, the firm‘s strategicmission, goals, and corporate plans should be studied, along with theresults of human resource planning. The next level of analysisfocuses on the tasks that must be accomplished in order to achievethe firms purposes. Job descriptions, performances appraisals and interviews or surveys of supervisors and job incumbents are importantdata sources for this analysis level. Finally, individual training needsmust be addressed. The relevant questions are “Who needs to betrained?“ and “What kind of training is needed?“

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Establishing Training and DevelopmentObjectives

T&D objectives are necessary. Without them, designing meaningfulT&D programs would not be possible.

T&D objectives are indepted to several standards. These standardsare

- handling, - precision and - measurability.

Besides T&D objectives have three dimensions:

- Content- Direction and - Time

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Selecting Training and DevelopmentMethods

Training-on-the-Job- Learning by Experience(learningjob tasks by actually

performing)- Job Rotation- Job Enlargement- Job Enrichment- Computer-Based Training- Web-Based Training- Teamwork- Substitution- Coaching- Mentoring- Internship

Training-off-the-Job- Business Games- Case Study- Videotapes- In-Basket Training- Role Playing- Distance Learning and Videoconferencing

- Classroom Programs- Simulators- Quality Circle- Work Groups

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Implementing Training and DevelopmentPrograms

Implementing T&D programs is often difficult.

1. Many managers are action oriented and feel that they aretoo busy for T&D.

2. Qualified trainers must be available.

3. Training implies change which employees may resist.

4. The content and the methods of T&D must relate to the workrequirements and to the career planning.

5. Another difficulty in implementing T&D programs is recordkeeping. Records inform how well he or she performs duringthe training and on the job.

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Evaluation Training and Development

The credibility of T&D can be enhanced if the tangible benefits to theorganization can be shown. There are several approaches in order to determine the valuable service and the value added.

- Participants opinions- Extent of learning- Behavioral change- Accomplishment of T&D objectives- Application at the workplace- Feedback of immediate supervisors and collegues- Benchmarking

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5.3 Special Subjects of Training and Development

Management Development

Orientation

Vocational Training

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5.3.1 Management Development

DefinitionManagement development consists of all learning experiencesprovided by an organization for the purpose of upgrading skills and knowledge required in current and future managerial positions.

If critical knowledge and skills are provided by organizations in develoment programs, the process will require personal commitment of the individual manager. In fact, taking responsibility for one‘s owndevelopment may be the most important aspect.

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The Adjustment of Management DevelopmentManagement development can be offered in-house or outside thecompany.

The most frequently mentionedreasons for keeping managementtraining inside the company arethe following:

- Consideration of companyrequirements and needs

- Lower costs- Less time- More control of content and procedure

The most frequently mentionedreasons to conduct managementtraining outside the company arethe following:

- An outside perspective- New viewpoints- Exposure to experts and research- Broader vision

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Special Training Areas

Management development often deals with

- leadership- diversity,- customer service,- conflict resolution,- values,- teamwork,- empowerment,- remedical training.

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5.3.2 Orientation

DefinitionFirst impressions are the most lasting. Because of this, manycompanies have orientation programs for new hires.

Orientation wants to inform new employees about the company(products, benefits, policies, procedures, organizational structure, corporate culture), the job and the work group. To perform effectivelyund efficiently, they need information which allows them to do theirjobs and helps them to understand their co-workers behavior.

Orientation is effective in retaining and motivating personnel.

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Purposes of Orientation

Orientation acquaints employees with

- the employment situation (the job, department ...),- company policies and rules,- compensation and benefits,- corporate culture.

Orientation influences

- the socialization,- team membership,- dealing with change.

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5.3.3 Vocational Training

DefinitionVocational training is the first systematical training of occupationalskills and competence. It is based on special laws.

In Germany firms and schools ( especially vocational trainingschools) are responsible for the vocational training. This is calledthe dual system of vocational training.

The firms are responsible for the practical training and thevocational training schools impart comprehensive skills and general knowledge.

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Advantages und Disadvantages of theDual System

• Risk of conflicts betweenproduction objectives and training goals

• No cooperations betweeninstructors and teachers

• Out-dated curricula and antiquated training plans(this refers especially to thevocational schools)

• Vocational Training isclose to reality

• Learning by doing• Integration the

apprentices in productionoperations

DisadvantagesAdvantages

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Implementing the Vocational Training

Methodical approach (job instruction, discussions, work in projects, team work, junior firms, computer-based training, visits ...)

Time management (period of vocational training, reduction of theapprenticeship, time sharing between firm and school ...)

Space management (apprentices‘ shop, employment in thefunctional departments ...)

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The Holistic Vocational Training

Many firms aim at the holistic vocational training. The holistic vocationaltraining contains

- skills and knowledge (this is the traditional way of vocational training), - methodical and social qualifications.

The employees should learn the capability to act. In this case theybecome more flexible and are able to take over many different jobs.

The capability to act includes the following components:

- The employee knows what to do.- He / she knows the work process.- He / she knows the objectives which relate to the job.- He / she knows the players and the relations / connections betweenthem.

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6. Career Planning and Career Development

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6.1 Definition

A career is a general course that a person chooses to pursuethroughtout his or her working life.

Career planning is an ongoing process whereby an individual setscareer goals and identifies the means to achieve them. The major focusof career planning should be on matching personal goals withopportunities that are realistically available.

In organizational career planning, the organization identifies paths and activities for indvidual employees as they develop. Organizational careerplanning is necessary to help ensure that a firm improves its abilitiy to perform by identifiying needed capabilities and the type of people neededto perform in an ever-evolving business environment.

Career development is a formal approach used by the organization to help people acquire the skills and experiences needed to perform currentand future jobs. Career development is important to maintain a motivatedand committed workforce.

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6.2 Career Security / Employability

For many employees career planning involves planning ways to improve their career security as opposed to ensuring job securitywithin the organization. Fewer and fewer companies offer real job security by protecting employees against job loss. Instead of job security, employees strive for career security.

Career security is the development of marketable skills and expertisethat help ensure employment within a range of career.

Career security is different from job security in the way that job securityimplies security in one job, often with one company. With careersecurity employees are offered opportunities to improve their skills in an ever-changing work-environment. Under this so-calledemployability doctrine, employees owe the company theircommitment while on board and the company owes ist workers theopportunity to learn new skills.

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6.3 Factors Influencing Career Planning

There are several factors which infuence a person‘s view of a career. Two major factors affect career planning:

Career-impacted life stages:

The main life stages of career cycle include growth, exploration, establishment, maintenance and decline.

Career anchors:

The career anchors are managerial competence, functionalcompetence, security, creativity, autonomy and independence, and technical competence.

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6.4 Career-Impacted Life Stages

DeclineDeclineMainten-ance

Mainten-anceEstablishmentEstablishmentExplorationExplorationGrowthGrowth

Stage 1 Stage 2 Stage 3 Stage 4 Stage 5

From birthto age 14

Developinga self-concept

From 15 to 24

Developing a realistic under-standing of abilities and talents

From 25 to 44

Finding a suitableoccupation; engaging in those activitiesthat helpestablish a career

Between the age of 45 and 64

Making an effortto maintain and to push thecareer

Losing power and respon-sibility; preparing forretirement

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6.5 Individual Career Planning

Through career planning, a person continuously evaluates his or her abilities and interests, considers alternative career opportunities, estblishes career goals, and plans practical development activities.

Individual career planning must begin with self-understanding or self-assessment. Then, the person is in a position to establish realistic goalsand to determine what to do to achieve these goals.

Self-assessment means learning about oneself. Some useful tools are

- a strength/weakness balance sheet and - a likes and dislikes survey

Getting to know oneself is not an singular event. Self-assessment shouldbe viewed as a continuous process.

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6.6 Organizational Career Planning

In organizational career planning, the organization identifies pathsand activities for indvidual employees as they develop.

Management observes the employee‘s performence and compares itwith the job standards. Strength and weakness are noted, enablingmanagement to assist the employee in making a tentative careerdecision. This tentative career decision is based on a number of factors, including personal needs, abilities and aspirations, and theorganization‘s needs.

Although the primary responsibility for career planning rests with theindividual, organizational career planning must run closely parallel to individual career planning if a firm is to retain its best and brightestemployees. Workers have to see that the company‘s organizationalcareer planning effort is directed toward furthering their specificcareer objectives.

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6.7 Career Paths

A career path is a flexible line of movement through which an employee may move during employment with a company.

There are several career paths:

Traditional career path

Network career path

Lateral career path

Dual career path

Adding value to the career / employability doctrine

Demotion

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6.8 Career Development

Career development is a formal approach taken by the organization to ensure that people with proper qualifications and experiences areavailable when needed.

Career development relates to skills, knowledge and experiences as well as behavioral modifications that allow individuals to work betterand add values.

Career development benefits both: the organization and the employee.

The tools of career development are similar to those discripted in chapter “Training and Development“

The employee‘s immediate supervisor is responsible for providingsupport, advice and feedback.

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6.9 Career Planning and DevelopmentMethods

There are numerous methods for career planning and development:

- Discussions with knowledgeable individuals- Company materials for example job descriptions- Performance appraisal- Workshops- Self-assessment and personal development plans- Software packages and career planning web sites- Inquiry of the corporate policies, objectives and strategies

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7. Performance Appraisal

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7.1 Definition

Performance appraisal is a system which reviews and evaluates an individual‘s or teams‘s job performance. Besides an effective system should evaluate accomplishments, should develop plans for theindividual and the team and should assess employee potential.

The primary goal of performance appraisal is to improve performance.

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7.2 Uses of Performance Appraisal

Performance appraisal data can be used in several human resourcefunctions. It is the information base for

- human resource planning,- recruitment and selelection,- training and development,- career planning and development,- compensation programs,- internal employee relations.

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7.3 The Performance Appraisal Process

Stage 5Stage 5Stage 4Stage 4Stage 3Stage 3Stage 2Stage 2Stage 1Stage 1

Identifyingspecificperformanceappraisalgoals

Establishingjob expecta-tions / job analysis

Examiningworkperformed

Appraisingperformance

Discussingappraisalwith theemployee

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7.4 Appraisal Criteria

In practice the most common appraisal critiera are

qualifications,

traits (attitude, appearance, initiative...),

behaviors (leadership style, teamwork, cooperation, customer service orientation...),

task outcomes,

improvement potential.

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7.5 Responsibility for Appraisal

In many companies the human resource department is responsiblefor developing and implementing performance appraisal programs. It is essential that line managers play a key role from beginning to end. They must directly participate in the program – as designerand user.

There are severals possibilities in carrying responsibility for rating:

Evaluation of the employees by their supervisors

Evaluation of managers by subordinates

Peer evaluation

Self-appraisal

Evaluation by the customers

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7.6 Requirements

An effective performance appraisal requires the following factors:

Job-related criteria

Performance expectations

Standardization

Documentation

Trained appraisers

Continuous open communication

Due process

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7.7 Performance Appraisal Methods

There are several performance appraisal methods:

- Appraisal interview- Rating scales- Critical incidents method- Behaviorally anchored rating scales- Essay method- Works standards method- Ranking method- Paired comparison- Forced distribution method- Assessment center- The 360-degree feedback

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7.8 Problems in Performance Appraisal

The problems associated with performance appraisal include

-the lack of objectivity,- halo error,- leniency,- strictness,- central tendency,- recent behavior bias,- personal bias,- manipulation of evaluation.

Skript human resource management

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