Summary Human Resource Management
B&M (EBB617B05)
Robert N Lussier & John R. Hendon Chapters 1-8, 11,12,16
,Chapter 1. The New Human Resource Management Process
In the 21st century organization, human resources (HR)—the people within an organization—
are one of the primary means of creating a competitive advantage for the organization, because
management of human resources affects company performance.
Managers are responsible for getting the job done through employees, so the organization’s
human resources are nearly always its most valuable resource.
overall concept of employee engagement is much larger. It is a combination of job satisfaction,
ability, and a willingness to perform for the organization at a high level and over an extended
period of time.
In this text, we define engaged employees as those who understand what they need to do to
add value to the organization and are satisfied enough with the organization and their roles
within it to be willing to do whatever is necessary to see to it that the organization succeeds.
HRM in the Past
HR managers were expected to be only paper pushers who could keep all of the personnel files
straight. They maintained organizational records, but they had very little to do with the
management of the organization’s business processes.
Present view of HRM
The old workplace in which managers simply told employees what to do is gone. In today’s
organization, you will most likely work in a team, perform lots of quantitative analysis on
business data, and share in decision making and other management tasks. Modern
organizations also expect significantly greater productivity than occurred in their historical
counterparts.
A productivity center is a revenue center that enhances profitability of the organization through
enhancing the productivity of the people within the organization. So, why does a modern
organization worry so much about HRM? Today’s HR managers are no longer running an
organizational cost center. Their function, along with that of all other managers within the
organization, is to improve organizational revenues and profits—to be a profit center.
Productivity is the end result of two components that managers work to create and improve
within the organization:
• Effectiveness—a function of getting the job done whenever and however it must be
done. It answers the question, “Did we do the right things?”
• Efficiency—a function of how many organizational resources we used in getting the
job done. It answers the question, “Did we do things right?”
Chief Human Resource Officers (CHRO) are concerned about employee engagement and
productivity, and especially about improving efficiency in their respective organizations,
and companies have learned that they need some of their best managers in the HRM job.
In addition to improving efficiency, some fairly new research has shown that among Fortune
500 firms, having a senior HR manager in the “C-suite”—meaning having a CHRO in addition
to having a chief operations officer (COO), a chief finance officer (CFO), and so on—increased
profitability by 105% over peer companies that did not have a CHRO!
,We physically use up monetary resources, facility resources, and material resources, but we
use up the time available from our people.
Technology’s effect on efficiency
Senior HR Managers have learned that one way to improve efficiency of their workers is
through use of technology.
New HRM challenges
The three biggest challenges according to HR executives:
1. Maintaining high levels of employee engagement
2. Developing next generation organization leaders
3. Maintaining competitive compensation and benefits offerings
The biggest challenges according to non-HR executives were very similar:
1. Developing next generation organizational leaders
2. Managing the loss of key workers and their skill sets
3. Maintaining competitive benefits and compensation offerings
The HR competencies that will be the most critical:
1. Business acumen: ability to understand and apply information to contribute to the
Organization’s strategic plan
2. Organizational leadership and navigation: ability to direct and contribute to
initiatives and processes within the organization
3. Critical evaluation: ability to interpret information to make business decisions and
recommendations
4. HR expertise: ability to apply the principles and practices of HRM to contribute to
the success of the business
We have pursued better selection and retention strategies for a number of years, and we have
recently become much better at identifying future leaders and managing organizational
relationships, culture, and structure. Where we have still not done as well—at least in most
organizations—is in business acumen, especially in quantitative areas dealing with metrics and
data analytics. The ability to analyze large data sets allows HRMs to work toward overcoming
another of their challenges—creating strategic agility
Labor demographics
“Businesses no longer have a “typical” worker—diversity in terms of gender, ethnicity and
religion abounds within organizations.” Aging of the workforce, skills shortages, and many
other factors affect the ability of HR to provide the organization with the right numbers and
types of employees.
Companies in developed countries are seeing a reduction in the number and quality of potential
skilled employees, as well as greater gender, ethnic, and age diversity than at any time in the
past. The lack of skilled workers for increasingly complex jobs is considered to be a major,
ongoing problem.
Knowledge workers and the pace of change
Knowledge workers are workers who “use their head more than their hands” and who gather
and interpret information to improve a product or process for their organizations. In essence,
knowledge workers manage knowledge for the firm.
, We must continually figure out ways to use the technology more successfully through hiring
and training better and more capable employees—our human resources. If we do this, then as
the technology changes, our people will continually figure out ways to take advantage of it
before our competitors’ people do.
Knowledge is precious in an organization. There is a continuous shortage of knowledge
workers in most countries of the world, —too few knowledge workers and too many knowledge
jobs open and waiting for them.
Critical dependent variables
let’s look at some of the things that managers tell us they must control to compete in today’s
business environment, but that they can’t directly manipulate because people have free will.
These items are called dependent variables because they can be affected only through indirect
means. We don’t have the ability to directly manipulate them. We have to control some other
variable—called an independent variable because we can independently (directly) control it—
to affect these items in any meaningful way.
What issues are the most important and most difficult things to deal with?
1. Productivity—Productivity is the amount of output that an organization gets per unit of input,
with human input usually expressed in terms of units of time.
2. Employee engagement— those who understand what they need to do to
add value to the organization and are satisfied enough with the organization and their roles
within it to be willing to do whatever is necessary to see to it that the organization succeeds.
3. Turnover—permanent loss of workers from the organization. When people quit, it is
considered voluntary turnover, while when people are fired, it is involuntary turnover.
4. Absenteeism—temporary absence of employees from the workplace
we can’t force an employee come to work and thus avoid absenteeism, nor can we force an
employee to be happy with their work. We have to create conditions in which the employee is
willing to or even wants to come to work and in which they can enjoy their job. We can and
should do this through employment practices that the employee perceives as fair and
reasonable, such as providing acceptable pay for the tasks performed by the employee.
Turnover is the permanent loss of workers from the organization. Does turnover cost the
organization? Absolutely! There is strong and “growing recognition that collective turnover
can have important consequences for organizational productivity, performance, and—
potentially—competitive advantage.”
First is the cost of the paperwork associated with the departing employees; and if they left
involuntarily, we may have increases in our unemployment insurance payments and might even
have some potential security issues. Next, there is finding someone else to do the job, which
incurs job analysis costs, recruiting costs, and selection costs. Once we hire someone new, we
have orientation and other training costs, costs associated with getting the new worker up to
speed on their job (something we call a learning curve), and the costs associated with them just
not knowing our way of doing business (every company has a unique culture, and not knowing
how to act within that culture can cause problems).
Absenteeism is the failure of an employee to report to the workplace as scheduled. Absenteeism
costs companies money.
- Productivity loss
B&M (EBB617B05)
Robert N Lussier & John R. Hendon Chapters 1-8, 11,12,16
,Chapter 1. The New Human Resource Management Process
In the 21st century organization, human resources (HR)—the people within an organization—
are one of the primary means of creating a competitive advantage for the organization, because
management of human resources affects company performance.
Managers are responsible for getting the job done through employees, so the organization’s
human resources are nearly always its most valuable resource.
overall concept of employee engagement is much larger. It is a combination of job satisfaction,
ability, and a willingness to perform for the organization at a high level and over an extended
period of time.
In this text, we define engaged employees as those who understand what they need to do to
add value to the organization and are satisfied enough with the organization and their roles
within it to be willing to do whatever is necessary to see to it that the organization succeeds.
HRM in the Past
HR managers were expected to be only paper pushers who could keep all of the personnel files
straight. They maintained organizational records, but they had very little to do with the
management of the organization’s business processes.
Present view of HRM
The old workplace in which managers simply told employees what to do is gone. In today’s
organization, you will most likely work in a team, perform lots of quantitative analysis on
business data, and share in decision making and other management tasks. Modern
organizations also expect significantly greater productivity than occurred in their historical
counterparts.
A productivity center is a revenue center that enhances profitability of the organization through
enhancing the productivity of the people within the organization. So, why does a modern
organization worry so much about HRM? Today’s HR managers are no longer running an
organizational cost center. Their function, along with that of all other managers within the
organization, is to improve organizational revenues and profits—to be a profit center.
Productivity is the end result of two components that managers work to create and improve
within the organization:
• Effectiveness—a function of getting the job done whenever and however it must be
done. It answers the question, “Did we do the right things?”
• Efficiency—a function of how many organizational resources we used in getting the
job done. It answers the question, “Did we do things right?”
Chief Human Resource Officers (CHRO) are concerned about employee engagement and
productivity, and especially about improving efficiency in their respective organizations,
and companies have learned that they need some of their best managers in the HRM job.
In addition to improving efficiency, some fairly new research has shown that among Fortune
500 firms, having a senior HR manager in the “C-suite”—meaning having a CHRO in addition
to having a chief operations officer (COO), a chief finance officer (CFO), and so on—increased
profitability by 105% over peer companies that did not have a CHRO!
,We physically use up monetary resources, facility resources, and material resources, but we
use up the time available from our people.
Technology’s effect on efficiency
Senior HR Managers have learned that one way to improve efficiency of their workers is
through use of technology.
New HRM challenges
The three biggest challenges according to HR executives:
1. Maintaining high levels of employee engagement
2. Developing next generation organization leaders
3. Maintaining competitive compensation and benefits offerings
The biggest challenges according to non-HR executives were very similar:
1. Developing next generation organizational leaders
2. Managing the loss of key workers and their skill sets
3. Maintaining competitive benefits and compensation offerings
The HR competencies that will be the most critical:
1. Business acumen: ability to understand and apply information to contribute to the
Organization’s strategic plan
2. Organizational leadership and navigation: ability to direct and contribute to
initiatives and processes within the organization
3. Critical evaluation: ability to interpret information to make business decisions and
recommendations
4. HR expertise: ability to apply the principles and practices of HRM to contribute to
the success of the business
We have pursued better selection and retention strategies for a number of years, and we have
recently become much better at identifying future leaders and managing organizational
relationships, culture, and structure. Where we have still not done as well—at least in most
organizations—is in business acumen, especially in quantitative areas dealing with metrics and
data analytics. The ability to analyze large data sets allows HRMs to work toward overcoming
another of their challenges—creating strategic agility
Labor demographics
“Businesses no longer have a “typical” worker—diversity in terms of gender, ethnicity and
religion abounds within organizations.” Aging of the workforce, skills shortages, and many
other factors affect the ability of HR to provide the organization with the right numbers and
types of employees.
Companies in developed countries are seeing a reduction in the number and quality of potential
skilled employees, as well as greater gender, ethnic, and age diversity than at any time in the
past. The lack of skilled workers for increasingly complex jobs is considered to be a major,
ongoing problem.
Knowledge workers and the pace of change
Knowledge workers are workers who “use their head more than their hands” and who gather
and interpret information to improve a product or process for their organizations. In essence,
knowledge workers manage knowledge for the firm.
, We must continually figure out ways to use the technology more successfully through hiring
and training better and more capable employees—our human resources. If we do this, then as
the technology changes, our people will continually figure out ways to take advantage of it
before our competitors’ people do.
Knowledge is precious in an organization. There is a continuous shortage of knowledge
workers in most countries of the world, —too few knowledge workers and too many knowledge
jobs open and waiting for them.
Critical dependent variables
let’s look at some of the things that managers tell us they must control to compete in today’s
business environment, but that they can’t directly manipulate because people have free will.
These items are called dependent variables because they can be affected only through indirect
means. We don’t have the ability to directly manipulate them. We have to control some other
variable—called an independent variable because we can independently (directly) control it—
to affect these items in any meaningful way.
What issues are the most important and most difficult things to deal with?
1. Productivity—Productivity is the amount of output that an organization gets per unit of input,
with human input usually expressed in terms of units of time.
2. Employee engagement— those who understand what they need to do to
add value to the organization and are satisfied enough with the organization and their roles
within it to be willing to do whatever is necessary to see to it that the organization succeeds.
3. Turnover—permanent loss of workers from the organization. When people quit, it is
considered voluntary turnover, while when people are fired, it is involuntary turnover.
4. Absenteeism—temporary absence of employees from the workplace
we can’t force an employee come to work and thus avoid absenteeism, nor can we force an
employee to be happy with their work. We have to create conditions in which the employee is
willing to or even wants to come to work and in which they can enjoy their job. We can and
should do this through employment practices that the employee perceives as fair and
reasonable, such as providing acceptable pay for the tasks performed by the employee.
Turnover is the permanent loss of workers from the organization. Does turnover cost the
organization? Absolutely! There is strong and “growing recognition that collective turnover
can have important consequences for organizational productivity, performance, and—
potentially—competitive advantage.”
First is the cost of the paperwork associated with the departing employees; and if they left
involuntarily, we may have increases in our unemployment insurance payments and might even
have some potential security issues. Next, there is finding someone else to do the job, which
incurs job analysis costs, recruiting costs, and selection costs. Once we hire someone new, we
have orientation and other training costs, costs associated with getting the new worker up to
speed on their job (something we call a learning curve), and the costs associated with them just
not knowing our way of doing business (every company has a unique culture, and not knowing
how to act within that culture can cause problems).
Absenteeism is the failure of an employee to report to the workplace as scheduled. Absenteeism
costs companies money.
- Productivity loss
