Summary MNB1601 Summarised Study Notes

MNB1601

NOTES

, Business Management 1B
Topic ONE
Study Unit 1 – Human Resource management
1.1 Relationship between line managers and HR

 Advises and councils
 Service
 Policy formulation and implementation
 Employee advocacy
 Is responsible for: provision, maintenance and development of HR within the org
1.2 HR planning
1 Job analysis and job description
2 Job specification
3 HR forecasting and planning
Job analysis: describing and recording info about job behaviour and activities. Done by:
observation, interviewing, questionnaires
Job description: personal qualifications an employee must possess to perform duties and
responsibilities in job description (NOTE: forms basis of job specification for recruitment,
selection and training, and also provides basis for job compensation)
HR forecasting: forecast the quality and quantity of employees that the business is going to
need in the future. It balances supply and demand. Demand = affected by business
objectives. Supply – affected by HR programmes supplying the HR. Factors to keep in mind:
economic growth, new development in business, labour market
NOTE: HR manager does not motivate staff – they assess the level of motivation in various
departments and advises line managers of methods to improve it
NOTE: HR function assists line managers in the org to utilise staff effectively
NOTE: HR works with line management to solve people related issues, but tasks of each are very
different
Can now development the Human Resources Plan (see figure 9.3 in the TEXT BOOK for diagram)
1.3 Finding qualified workers
Recruitment
Internal recruitment:
ADVANTAGES – career planning, employees can see future at the business, boosts morale,
assessment of applicants is easier, costs are very low.
DISADVANTAGES – stagnation, not everyone appointed at lowest level is suitable for highest, people
with high potential may not be willing to wait through lower levels, can create competition between
staff (hindering cooperation)
External recruitment:

,ADVANTAGES – active effort to find right person for the job. New ideas, schools of thought and
approaches mean there is a possibility for innovation
DISADVANTAGES – costs are much higher, assessment is never perfect, morale of current workforce
can be negatively influenced
Most businesses use a mix of both – first looking internally, and then outside. Some advertise all
jobs (above a certain level) but encourage internal staff to apply.
The recruitment procedure:
 Must use efficient HR record system (HRIS) which contains employee qualifications, training
and experience, achievements and interests, etc. makes internal identification of possible
candidates more efficient
 From OUTSIDE is more complex – must know WHOM, WHERE and HOW to recruit, and
ensure not too many, but ENOUGH suitable candidates apply. Start with a labour market
analysis, including the geographic and social area from which labour should be recruited
Recruitment techniques:
Can use:
 Advertisements
 Consultants and labour agencies
 Through existing employees
 Personal approach
 Radio, TV and internet
 Sundry recruitment strategies, such as visits to schools/ technikons, bursaries, career
exhibits
Selection:
Varies from post to post, and the higher the level, the more intensive it is. Senior management
usually has 3 phases – preliminary screening, intensive assessment and final selection
Placement and induction:
New employees should have orientation and socialisation to ensure they start to work productively
faster
1.4 Developing qualified workers (HRD – human resources development)
Training – provides knowledge and skills to do a particular job, or change attitudes
Development – has longer term focus, and increases capacity at current job, LEARNING is key
HRD should start when employee joins company, and continue throughout their career. DON’T
“shotgun” and throw everything you can – must be specific to individual needs
Methods:
 Informally at work
 Formally at work
 Informally outside work
 Formally outside work
Performance appraisal:

, Is also called employee rating, employee evaluation, performance review and results appraisal.
Should be OBJECTIVE to be effective. Least effective when general impressions are noted, and
prejudice will be more likely. Should take a 360 degree approach. Results can be disappointing if
top management does not support, if there are unclear performance standards, if there is rater bias,
too many forms to complete and use of program has confliction purposes.
Results can be used for:
 Basis of financial reward
 Determine promotion
 Employee feedback
Feedback to employee is essential, and should be concise, specific, relevant and supportive
1.5 Keeping qualified workers
COMPENSATION is most important motivator (along with nature of work)
TYPES OF COMPENSATION
Direct compensation:
 Salaries and wages
 Usually related to how long worked there
 No correlation between pay and amount of work performed
 Easy to administer
BUT
 No distinction between production and unproductive workers so some companies use a
piece wage system, where they are compensated by how much work they perform,
regardless of how long it takes them
Indirect compensation:
 Fringe benefits
 Increase in size and scope as move to higher levels of org
 Usually include leave, insurance, housing, car and sometimes others
Reward:
 Salary, bonus and fringe benefits are NOT related to performance, and does not increase
motivation
 Some rewards that motivate are salary increases based on performance, merit increases,
financial bonus related to performance, paid holiday or overseas trip to outstanding
employees
SIZE OF COMPENSATION
 First do external analysis with countrywide salary survey
 Then internal comparison (with job evaluations)