1-1

2003 Prentice Hall, Inc.

Human Resource Management

Chapter 1: Introduction to
Human Resource Management
Ass. Prof. Ipek Kalemci TUZUN

1-2

2003 Prentice Hall, Inc.

Personnel Management Approach

Human Resource
Management Approach

Manpower centered
Pragmatic
Job oriented

Resource centered
Strategic
Staff oriented

Employee-organization relations

by HRM approach

HRM is a term for what historically was referred as personnel administration

or personnel management. In todays arena, HR managers are sometimes

called people managers and employees are refereed as our associates.
2

1-3

2003 Prentice Hall, Inc.

The Management Process

Planning
Organizing
Staffing
Leading
Controlling

1-4

2003 Prentice Hall, Inc.

The evolution of HRM

Decade

Major Business Ideas

Common
HR titles
No HR people

Pre-1900s

Small business and

workers guilds

1900s

Large-scale enterprise Labor relations,

growth
personnel

1920s

Depression, first labor

legislation

Industrial
relations,
personnel
4

1-5

Decade

2003 Prentice Hall, Inc.

Major Business Ideas

Common
HR titles

1940s

WW II, growth of large

diversified enterprises

1960s

Civil rights and compliance Personnel

1980s

Growing impact of
Personnel,
globalization and
Human
technology; human capital; Resources
emergency of the
knowledge/service
economy

Personnel
administration

1-6

Decade
2000s

2003 Prentice Hall, Inc.

Major Business Ideas

Modern organizations,
organization effectiveness,
strategic HR planning

Common
HR titles
Human
Resource
Management

1-7

2003 Prentice Hall, Inc.

Management Process
Planning
Goals and standards
Rules and procedures
Plans and forecasting.
Organizing
Tasks
Departments
Delegating
Authority and communication
Coordinating
7

1-8

2003 Prentice Hall, Inc.

Management Process

Staffing
Hiring
Recruiting
Selecting
Performance standards
Compensation
Evaluating performance
Counseling
Training and developing
8

1-9

2003 Prentice Hall, Inc.

Management Process

Leading
Getting the job done
Morale
Motivation
Controlling
Setting standards
Comparing actual performance to standards
Corrective action
9

1-10

2003 Prentice Hall, Inc.

Human Resource Management

Human Resource Management is the process of acquiring, training,
appraising, and compensating employees and attending to their labor
relations, health and safety, and fairness concerns.

Human Resource Management can be defined as the implementation of the

strategies, plans and programs required to attract, motivate, develop,
reward and retain the best people to meet the organizational goals and
operational objectives of the organization.

10

1-11

2003 Prentice Hall, Inc.

HRM Functions Include:

Conducting job analyses

(determining the nature of each

employees job)
Planning labor needs and
recruiting job candidates
Selecting job candidates
Orienting and training new
employees
Managing wages and salaries
(compensating employees)
Providing incentives and
benefits
Appraising performance

Communicating (interviewing,

counseling, disciplining)
Training and developing
managers
Building employee commitment
Building loyalty

11

1-12

2003 Prentice Hall, Inc.

HHRM is Important to all Managers.

** In order to decrease turnover

The wrong person, High

turnover(**)
**(turnover rate; number of replacement * 100
average number of employee

Low effectiveness and

efficiencies
Useless interviews
Poor training
Unfair labor practices

rate;
Better advancement
opportunities
More training
Flexible schedules
mproved benefits
Greater employee
involvement in operations
Recognition programs
Good communication of
rules and regulations
Resolving employee
complaints

12

1-13

2003 Prentice Hall, Inc.

So,
Human Resources are the people in the organization
Human Resource Management is a series of activities and

decisions carried out by all line managers that help employees

get the job done and achieve their objectives
Human Resource Department consist of specially trained

professionals who help managers carry out human resource

management responsinsibilities

13

1-14

2003 Prentice Hall, Inc.

Line and Staff Aspects of HRM

Authority is the right to make decisions, to direct the work

of others, and to give orders

Line Managers are authorized to direct the work of

subordinates. They are always someones boss. In general

they are in charge of accomplishing of the groups goals

Staff Managers

are authorized to assist and advise line managers

in their goals. They aid line managers in areas like
recruiting, hiring and compensation

14

1-15

2003 Prentice Hall, Inc.

Line Managers HRM Jobs

1. Placing the right person on

the right job

2. Starting new employees in
the organization (orientation)
3. Training employees for jobs
that are new to them
4. Improving the job
performance of each person
5. Gaining creative cooperation
and developing smooth working
relationships

6. Interpreting the companys

policies and procedures

7. Controlling labor costs
8. Developing the abilities of
each person
9. Creating and maintaining
department morale
10. Protecting employees health
and physical condition

15

1-16

2003 Prentice Hall, Inc.

FIGURE 13 Employment and RecruitingWho Handles It?

(Percentage of All Employers)

Note: Length of bars represents prevalence of activity among all surveyed employers.
Source: HR MAGAZINE, BNA/Society for Human Resource Management, 2002.
Reproduced with permission via Copyright Clearance Center.

16

1-17

2003 Prentice Hall, Inc.

As a company grows, line

managers need the assistance as
well as the specialized
knowledge and advice of a
separate HR staff

17

1-18

2003 Prentice Hall, Inc.

HRM DEPARTMENT

Line authority The authority exerted by a personnel manager by directing the activities of the
people in his or her own department and in service areas (like the plant cafeteria).
Implied authorityThe authority exerted by a personnel manager by virtue of others knowledge that
he or
she has access to top management (in areas like testing and affirmative action).

Functional controlThe authority exerted by an HR manager as coordinator of personnel activities.

Employee advocacyHR must take responsibility for clearly defining how management should be
treating employees, make sure
employees have the mechanisms required to contest unfair practices, and represent the interests of
employees within the framework of its primary obligation to senior management.

18

1-19

2003 Prentice Hall, Inc.

Human Resource Managers

Duties
Coordinative
Function

Line Function
Line Authority
Implied Authority

Functional Authority

Functions of
HR Managers

Staff Functions
Staff Authority
Innovator

19

1-20

2003 Prentice Hall, Inc.

Human Resource Specialties

Recruiters

Labor Relations
Specialists

Training
Specialists

Human
Resource
Specialties

EEO
Coordinators

Job Analysts

Compensation
Managers

20

1-21

2003 Prentice Hall, Inc.

Typical HR Positions
Recruiters; maintain contact with community and search for

qualified job applicants.

Job analysts; Collect and examine information about jobs to
prepare job descriptions and job specifications
Compensation managers; Develop compensation plans and
handle the employee benefits program.
Training specialists; Plan, organize, and direct training
activities.
Labor relations specialists. Advise management on all
aspects of unionmanagement relations.

21

1-22

2003 Prentice Hall, Inc.

FIGURE 11
HR Organization Chart
for a Large Organization

Source: [Link]/[Link]. Accessed May 6, 2007.

22

1-23

2003 Prentice Hall, Inc.

FIGURE 12 HR Organizational Chart (Small Company)

23

1-24

2003 Prentice Hall, Inc.

The changing role of HR

Effective HRM selection, training, pay and employee

fairness practices are crucial to capitalizing on

technology and remaining competitive
HR departments must move away from a

housekeeping focus to strategic maneuvering HRM

must evolve to remain dynamic

24

1-25

2003 Prentice Hall, Inc.

The new HR manager

Provides efficient operational services including

outsourcing service when necessary

Supports top managements strategic planning efforts
Acts as the companys internal consultant for

identifying and institutionalizing changes that

enhance employees skills allowing them to
contribute to the companys success

25

1-26

The Changing Environment of

Human Resource
Management

2003 Prentice Hall, Inc.

Globalization Trends

Changes and Trends

in Human Resource
Management

Technological Trends

Trends in the Nature of Work,

Human Capital
Workforce Demographic Trends

26

1-27

2003 Prentice Hall, Inc.

The Changing Environment of Human

Resource Management
Globalization; tendency of firms to extend their sales and

manufacturing to new markets abroad

Technological advances; technology has been forcing and
enabling firms to become more competitive (skilled employee,
empowerment)
The nature of work; Human capital(knowledge, education,
training, skills and expertise of a firms worker) provides
competitive advantage
The workforce diversity; increased diversity provide
challenges for HR management: Older, more multi-ethnic
workforce,Nontraditional workers,
Generation Y,Retirees

27

1-28

2003 Prentice Hall, Inc.

The Changing Role of

Human Resource Management
Strategic Human
Resource
Management

Managing with the

HR Scorecard
Process

New
Responsibilities
for HR Managers

Creating HighPerformance Work

Systems

Measuring the HRM

Teams Performance

28

1-29

2003 Prentice Hall, Inc.

Important HRM issues

Strategic human resource management

HRs use of technology

Managing ethics

29

1-30

2003 Prentice Hall, Inc.

What is strategic HRM?

A strategy is a companys plan for matching internal

strengths and weakness with external opportunities

and threats
Strategic HRM is the formulation and execution of HR

policies and practices that produce competent

employees with the behaviors needed to achieve the
companys strategic goals

30

1-31

2003 Prentice Hall, Inc.

FIGURE 18 Strategy and the Basic Human Resource

Management Process

31

1-32

2003 Prentice Hall, Inc.

HR and technology
Self-service

Call centers
Productivity

improvement
Outsourcing

32

1-33

2003 Prentice Hall, Inc.

Some Ways HR Managers Use Technology

33

1-34

2003 Prentice Hall, Inc.

Issues related to HR ethics

Workplace safety

Security of employee records

Employee theft
Affirmative action
Comparable work
Employee privacy rights

34

1-35

2003 Prentice Hall, Inc.

High-Performance Work System

Practices
Employment security

Selective hiring
Extensive training
Self-managed teams/decentralized decision making

Reduced status distinctions

Information sharing
Contingent (pay-for-performance) rewards
Transformational leadership
Measurement of management practices
Emphasis on high-quality work
35

1-36

2003 Prentice Hall, Inc.

Benefits of a High-Performance
Work System (HPWS)
Generate more job applicants
Screen candidates more effectively

Provide more and better training

Link pay more explicitly to performance
Provide a safer work environment
Produce more qualified applicants per position
Hiring based on validated selection tests
Provide more hours of training for new employees
Conduct more performance appraisals

36

1-37

2003 Prentice Hall, Inc.

FIGURE 15 Five Sample HR Metrics

HR Metric*
Absence rate

How to Calculate It
# of days absent in month
Average # of employees during month # of workdays

Cost per hire

100

Advertising + agency fees + employee referrals + travel cost of

applicants and staff + relocation costs + recruiter pay and benefits
Number of hires

HR expense
factor

Time to fill

HR expense
Total operating expense
Total days elapsed to fill job requisitions
Number hired

Turnover rate

Number of separations during month

Average number of employees during month

100

Sources: Robert Grossman, Measuring Up, HR Magazine, January 2000, pp. 2935; Peter V. Le Blanc, Paul Mulvey, and Jude T. Rich, Improving the Return on Human Capital: New Metrics,
Compensation and Benefits Review, January/February 2000, pp. 1320; Thomas E. Murphy and Sourushe Zandvakili, Data and Metrics-Driven Approach to Human Resource Practices: Using
Customers, Employees, and Financial Metrics, Human Resource Management 39, no. 1 (Spring 2000), pp. 93105; [HR Planning, Commerce Clearing House Incorporated, July 17, 1996;]
SHRM/BNA 2000 Cost Per Hire and Staffing Metrics Survey; [Link]. See also, SHRM Research 2006 Strategic HR Management Survey Report, Society for Human Resource Management..

37

1-38

2003 Prentice Hall, Inc.

Measuring HRs Contribution

The HR Scorecard

Shows the quantitative

standards, or metrics the firm
uses to measure HR activities.

Measures the employee

behaviors resulting from these
activities.

Measures the strategically

relevant organizational
outcomes of those employee
behaviors.

38

1-39

2003 Prentice Hall, Inc.

The Human Resource Managers

Proficiencies
New Proficiencies

HR proficiencies

Business proficiencies

Leadership proficiencies

Learning proficiencies

39