Human Resource Management
Lecture 1
Case of Starbucks
Starbucks operates in all over the world, continuously expanding
Starbucks is rated very high in increase and has its own strategy to deal with increase ( look at
turn over rate - nearly 70% - on average in coffee industry : 140% )
→ therefore, Starbucks displays a great example for HRM
The History of HRM
> - 1930 : Taylorism and scientific management : in order to get workers you need strict control,
no idea of human or personal management
> 1930 - 1960 : Personnel management : people recognized the previous organization was not
effective and personnel management emerged, so managers were forced to improve the
efficiency of their workers but also the quality
> 1960- : Human resource management : HRM has 2 different tracks: 1 track : psychologists
announced that workers are still human and you can’t use them as machines but you have to
recognize their motivations and connections with other people.
> 1970- : Strategic human resource management 2. Track : HRM should be aligned with
corporate strategies
M in HRM
• Traditionally HRM aimed for : task completion ; Absenteeism ; Turnover
• Key outcomes now :
• Improve performance & productivity (effectiveness +efficiency )
• Achieve organizational goals
• Help employees prosper (e.g., engagement)
• Stimulate positive behaviors
• Fulfill social responsibilities
Before 60s the HRM idea was to get work done, complete tasks and make sure that people show
up to work and to reduce absentees and lower turn-over rate
Imagine Starbucks has to deal with 400% turn-over rate a year - every season you get new staff
members in your stores which costs a lot of money
Why do we manage people and employees?
We not only aim for performance and productivity ( traditional outcomes), we also aim to help the
company to achieve organizational goals → this aligns with the strategic HRM idea that how you
hire people and how you manage people serves the same purpose of helping your company to
achieve the goals
The people within an organization
Human Resources are one of the most important things when creating a competitive advantage
for the organization. Reason for this: most organizations of comparable size and scope within the
same industry have access to the same material and resources, therefore: people are the
company’s most valuable asset
If the organization can manage its human resources more successfully than its competitors do,
then it has a much greater chance of being successful
Successful = more productive and profitable than competitors
Employee Engagement
Employee engagement = combination of job satisfaction, ability, and a willingness to perform for
the organization at a high level and over an extended period of time
Companies nowadays also pursue to helping employees to find their own value and develop their
own skills and enjoy their work, as well as engagement in work which stimulates positive behavior
,R in HRM
Employees as resources :
1. Economic Resources
knowledge, skills & abilities
2. Intangible assets
creativity, social capitals
3. Varying asset values
star vs. non-star employees
ups and downs of employees
Following the traditional term of HRM : you pay them and anticipate they deliver labor in return
Labor - refers to increase in knowledge and skills because these capabilities help you to achieve
things done
Therefore, resources refers to economic resources but also social resources - when you hire
people you also hire the person with a whole social network behind → intangible asset
Another example for intangible asset is creativity and innovation
Also Variation among employees is huge. Star performance = outstanding performance that
contributes to corporate performance
H in HRM
1. Human needs
- self-determination theory
2. Motivation and emotions
- Maslow’s motivation hierarchy
3. Employees wellbeing
- Stress, burnout, satisfaction
4. Life beyond work
- Security and health, wellbeing, work-life balance
Take into account that people want to make their own decisions - human need!
An example of Starbucks
• HR policies
Employees as partners - this is about respecting them and their values not just as workers but
as partners. This is why Starbucks pays them more than just the minimum wage. They also have
a lot of learning opportunities. They treat their employees respectful and help them to develop
competencies
• HR systems
Compensation structure
• HR practices
Salaries above minimum wage
College Achievement Plan, Coffee master program
Open forums with senior management
Planning includes forecasting how many
workers you’ll need, what skills they need etc.
Obtaining relates to the hiring process, you need
to attract enough people
Once I hired people, how do I manage them?
Check their performance and provide trainings
and learning opportunities as well as
motivating
The most valid performance interviews are
,designed around each candidates unique background - wrong if you use different questions for
everyone it is hard to compare different people.
Evidence- based HR practices are the key
HRM in the past
In the mid 70s HR managers were only expected to maintain organizational records, so that HR
departments provided limited services to the organization. HR was considered to bring no
revenue but to be costly
Present View of HRM
Today’t HR managers function is to improve organizational revenues and profits, which is done by
enhancing the productivity of the people working for the organization
Productivity = amount of output that an organization gets per unit of input
Improving Organizational Effectiveness
How can the company become more productive?
Productivity is the result of two components that managers work to create ad improve within the
organization
Effectiveness : getting the job done whenever and however it must be done - answers the
question ‚did we do the right things?‘
Efficiency : how many organizational resources were used in getting the job done - answers the
question ‚did we do things right?‘
HRM: New Challenges
First challenge : Globalization
Also refers to companies now dealing with suppliers and customers from different countries
Reasons: large companies want to expand
• Offshoring - relocation from home country to another country e.g. shift production it o a country
where its cheaper
• Outsourcing - shut down their own production of coffee since it was cheaper to produce in
other countries
• Reshoring - when a labor force in china gets more expensive or labor force gets more
expensive, you might bring jobs back home also for local acknowledgment
Starbucks : usually purchases coffee from Columbia and brings it to England but set up a firm in
Switzerland for the communication between UK and Columbia (Offshoring)
Global Participation and global employees
> Parent / home country : the country in which the company’s
corporate headquarters is located
- parent-country nationals
> Host country: the country in which the parent country
organization seeks to locate ( or has already located) a facility
- Host-country nationals
> Third country: a country other tan the host country or parent
country. A company may, but is less likely to have facility there.
- third-country nationals
HRM gets also a more and more global role since due to
globalization many companies want to send their employees to
different countries to explore different markets
, How does it challenge HRM to go through these different stages of Globalization?
> Obtain HR: home, host, third-party,…
racial and cultural diversity in labor forces
> Performance management: global assignment, expatriation and reparation
Global assignment and compensation - expatriation is very hard to rate regarding the turn
over rate in globalization, what do you plan for the people when they come back?
> Training and development
> Legislation compliance and labor relations
Second HRM Challenge : Changing demographic trends
> racial diversity
Lecture 1
Case of Starbucks
Starbucks operates in all over the world, continuously expanding
Starbucks is rated very high in increase and has its own strategy to deal with increase ( look at
turn over rate - nearly 70% - on average in coffee industry : 140% )
→ therefore, Starbucks displays a great example for HRM
The History of HRM
> - 1930 : Taylorism and scientific management : in order to get workers you need strict control,
no idea of human or personal management
> 1930 - 1960 : Personnel management : people recognized the previous organization was not
effective and personnel management emerged, so managers were forced to improve the
efficiency of their workers but also the quality
> 1960- : Human resource management : HRM has 2 different tracks: 1 track : psychologists
announced that workers are still human and you can’t use them as machines but you have to
recognize their motivations and connections with other people.
> 1970- : Strategic human resource management 2. Track : HRM should be aligned with
corporate strategies
M in HRM
• Traditionally HRM aimed for : task completion ; Absenteeism ; Turnover
• Key outcomes now :
• Improve performance & productivity (effectiveness +efficiency )
• Achieve organizational goals
• Help employees prosper (e.g., engagement)
• Stimulate positive behaviors
• Fulfill social responsibilities
Before 60s the HRM idea was to get work done, complete tasks and make sure that people show
up to work and to reduce absentees and lower turn-over rate
Imagine Starbucks has to deal with 400% turn-over rate a year - every season you get new staff
members in your stores which costs a lot of money
Why do we manage people and employees?
We not only aim for performance and productivity ( traditional outcomes), we also aim to help the
company to achieve organizational goals → this aligns with the strategic HRM idea that how you
hire people and how you manage people serves the same purpose of helping your company to
achieve the goals
The people within an organization
Human Resources are one of the most important things when creating a competitive advantage
for the organization. Reason for this: most organizations of comparable size and scope within the
same industry have access to the same material and resources, therefore: people are the
company’s most valuable asset
If the organization can manage its human resources more successfully than its competitors do,
then it has a much greater chance of being successful
Successful = more productive and profitable than competitors
Employee Engagement
Employee engagement = combination of job satisfaction, ability, and a willingness to perform for
the organization at a high level and over an extended period of time
Companies nowadays also pursue to helping employees to find their own value and develop their
own skills and enjoy their work, as well as engagement in work which stimulates positive behavior
,R in HRM
Employees as resources :
1. Economic Resources
knowledge, skills & abilities
2. Intangible assets
creativity, social capitals
3. Varying asset values
star vs. non-star employees
ups and downs of employees
Following the traditional term of HRM : you pay them and anticipate they deliver labor in return
Labor - refers to increase in knowledge and skills because these capabilities help you to achieve
things done
Therefore, resources refers to economic resources but also social resources - when you hire
people you also hire the person with a whole social network behind → intangible asset
Another example for intangible asset is creativity and innovation
Also Variation among employees is huge. Star performance = outstanding performance that
contributes to corporate performance
H in HRM
1. Human needs
- self-determination theory
2. Motivation and emotions
- Maslow’s motivation hierarchy
3. Employees wellbeing
- Stress, burnout, satisfaction
4. Life beyond work
- Security and health, wellbeing, work-life balance
Take into account that people want to make their own decisions - human need!
An example of Starbucks
• HR policies
Employees as partners - this is about respecting them and their values not just as workers but
as partners. This is why Starbucks pays them more than just the minimum wage. They also have
a lot of learning opportunities. They treat their employees respectful and help them to develop
competencies
• HR systems
Compensation structure
• HR practices
Salaries above minimum wage
College Achievement Plan, Coffee master program
Open forums with senior management
Planning includes forecasting how many
workers you’ll need, what skills they need etc.
Obtaining relates to the hiring process, you need
to attract enough people
Once I hired people, how do I manage them?
Check their performance and provide trainings
and learning opportunities as well as
motivating
The most valid performance interviews are
,designed around each candidates unique background - wrong if you use different questions for
everyone it is hard to compare different people.
Evidence- based HR practices are the key
HRM in the past
In the mid 70s HR managers were only expected to maintain organizational records, so that HR
departments provided limited services to the organization. HR was considered to bring no
revenue but to be costly
Present View of HRM
Today’t HR managers function is to improve organizational revenues and profits, which is done by
enhancing the productivity of the people working for the organization
Productivity = amount of output that an organization gets per unit of input
Improving Organizational Effectiveness
How can the company become more productive?
Productivity is the result of two components that managers work to create ad improve within the
organization
Effectiveness : getting the job done whenever and however it must be done - answers the
question ‚did we do the right things?‘
Efficiency : how many organizational resources were used in getting the job done - answers the
question ‚did we do things right?‘
HRM: New Challenges
First challenge : Globalization
Also refers to companies now dealing with suppliers and customers from different countries
Reasons: large companies want to expand
• Offshoring - relocation from home country to another country e.g. shift production it o a country
where its cheaper
• Outsourcing - shut down their own production of coffee since it was cheaper to produce in
other countries
• Reshoring - when a labor force in china gets more expensive or labor force gets more
expensive, you might bring jobs back home also for local acknowledgment
Starbucks : usually purchases coffee from Columbia and brings it to England but set up a firm in
Switzerland for the communication between UK and Columbia (Offshoring)
Global Participation and global employees
> Parent / home country : the country in which the company’s
corporate headquarters is located
- parent-country nationals
> Host country: the country in which the parent country
organization seeks to locate ( or has already located) a facility
- Host-country nationals
> Third country: a country other tan the host country or parent
country. A company may, but is less likely to have facility there.
- third-country nationals
HRM gets also a more and more global role since due to
globalization many companies want to send their employees to
different countries to explore different markets
, How does it challenge HRM to go through these different stages of Globalization?
> Obtain HR: home, host, third-party,…
racial and cultural diversity in labor forces
> Performance management: global assignment, expatriation and reparation
Global assignment and compensation - expatriation is very hard to rate regarding the turn
over rate in globalization, what do you plan for the people when they come back?
> Training and development
> Legislation compliance and labor relations
Second HRM Challenge : Changing demographic trends
> racial diversity
