HRM gaining a competitive advantage chapter 016 3rd ed

Roles of HR 16-2  Strategic partner  management of strategic human resources  Administrative expert  management of firm infrastructure  Employee advocate  management of employee co

Chapter Strategically Managing the HR Function

Objectives

• Describe the roles that HR plays in firms today

and the categories of HR activities.

• Discuss how the HR function can define its

mission and market.

• Explain the approaches to evaluating the

effectiveness of HR practices.

• Describe the new structure for the HR function.

• Relate how process reengineering is used to

review and redesign HR practices.

• Discuss the types of new technologies that can

improve the efficiency and effectiveness of HR.

• Describe how outsourcing HR activities can

improve service delivery efficiency and

Roles of HR 16-2

 Strategic partner

 management of strategic human resources

 Administrative expert

 management of firm infrastructure

 Employee advocate

 management of employee contributions

 Change agent

 management of transformation and change

 management of strategic human resources

 management of firm infrastructure

 management of employee contributions

 management of transformation and change

Activities of HR 16-3

Transactional Traditional

Transformational

Customer-oriented Perspective

of the HR Function 16-4

Customers

•Line managers

•Strategic partners

•employees

HR Function

Technology

•Staffing

•Performance

Management

•Rewards

•Training &

Development

Customer Needs

• committed employees

•competent employees

Measuring Human Resource Effectiveness: Why Do It?

16-5

 Provides critical information for its

strategic management

 Market the function

 Provides accountability

 Provides critical information for its

strategic management

 Market the function

 Provides accountability

Evaluating Human Resource Practices:

Approaches

16-6

 Audit approach

 reviews outcomes of HR functions

 Analytic approach

 determines whether program had intended effect

 estimates costs / benefits of program

 human resource accounting

 utility analysis

 Audit approach

 reviews outcomes of HR functions

 Analytic approach

 determines whether program had intended effect

 estimates costs / benefits of program

 human resource accounting

 utility analysis

Auditing Examples of Key Indicators and

Customer Satisfaction Measures for HR

Functions

16-7

Key Indicators Customer Satisfaction Measures

Staffing

- Average days to fill position

- Ratio of acceptances to offers

- Ratio of minority / women to

representation in labor market

- Treatment of applicants

- Per capita recruitment costs

- Average years of education

per job family

- Anticipation of personnel needs

- Timeliness of referring qualified candidates to supervisors

- Skill in handling terminations

- Adaptability to changing labor market conditions

Equal Employment Opportunity

- Ratio of EEO grievances to

employee population

- Minority representation by

EEO category

- Minority turnover rate

- Resolution of EEO grievances

- Daily assistance provided by HR department in implementing AA

- Aggressive recruitment to identify qualified women/minority applicants

Auditing Examples of Key Indicators and

Customer Satisfaction Measures for HR

Functions

16-8

Key Indicators Customer Satisfaction Measures

Compensation

- Per capita merit increases

- Ratio of reclassification to total

employees

- Competitiveness in labor market

- Percentage of overtime hours to

straight time

- Ratio of average salary offers to

other firms in community

- Fairnesss of existing job evaluation systems in assigning grades & pay

- Relationship between pay and performance

- Employee satisfaction with pay

Benefits

- Average unemployment

sation payment

- Average workers’ compensation

payment

- Benefit cost per payroll dollar

- Promptness in handling claims

- Fairness in application of policies

- Communication of benefits

- Assistance to line managers in controlling unnecessary claims

Auditing Examples of Key Indicators and

Customer Satisfaction measures for HR

Functions

16-9

Key Indicators Customer Satisfaction Measures

Training

- % of employees participating

per job family

- % receiving tuition refunds

- Training dollars per employee

- How well programs meet needs of employees and company

- Communication about available training opportunities

- Quality of orientation program

Employee Appraisal

and Development

- Distribution of appraisal info

- Appropriate dimensions on

appraisal forms

- Ratio of promotions to employees

- Ratio of openings filled internally

to externally

- Assistance in identifying potential

- Organizational development activities provided by department

- Number of promotions from within

- Counseling provided to employees

in career planning

Example of Cost- Benefit Approach for a Selection Test 16-10

Cost-Benefit Information Test Information

Current employment 4,404

Number separating 618

Number selected 618

Average tenure 9.69 years

Number of applicants 1,236 Testing cost per applicant $10

Total test cost $12,360 Average test score .80 SD Test validity 76

SD (per year) $10,413

Computation

Quantity = Average tenure x Applicants selected

= 9.69 years x 618 applicants

= 5,988 person-years

Quality = Average test score x test validity x SDy

= .80 x .76 x $10,413

= $5,331 per year

Utility = ( Quantity x quality ) - costs

= (5,988 person-year x $5,331 per year) - $12,360

= $37.9 million

Improving HR Effectiveness 16-11

 Restructuring

 Outsourcing

 Restructuring

 Outsourcing

 Process Redesign

The Reengineering Process 16-12

Identify

the process to

be reengineer

ed

STEP 1

The Reengineering Process 16-13

Understand the process

STEP 1

STEP 2

- can jobs be combined?

- can employees have more autonomy?

- are all the steps needed?

- is there redundancy?

- how many exceptions are there?

- are steps in proper order?

- what is the desired outcome?

Identify

the process

to be

reengineere

d

The Reengineering Process 16-14

Identify

the process

to be

reengineered

Understan

d the process Redesign

the process

STEP 1

STEP 2

STEP 3

- develop models

- test models

- choose prototype

- integrate prototype

The Reengineering Process 16-15

Identify

the process

to be reengineered

Understand the process

Redesign the process

STEP 1

STEP 2

STEP 3

STEP 4

Implement the new process

The Reengineering Process 16-15

Identify

the process

to be reengineered

Understand the process

Redesign the process

STEP 1

STEP 2

STEP 3

STEP 4

Implement the new process

feedback

Using New Technologies to Improve HR Effectiveness 16-17

 Interactive Voice Technology

 Internet

 Networks & Client-Server

Architecture

 Relational Databases

 Imaging

 CD-ROM & Laser Disc Technology

 Expert Systems

 Groupware

 Interactive Voice Technology

 Internet

 Networks & Client-Server

Architecture

 Relational Databases

 Imaging

 CD-ROM & Laser Disc Technology

 Expert Systems

 Groupware

Software Applications for HRM 16-18

 Staffing

 applicant recruiting & tracking

 EEO & AA reports

 Developing a master employee database

 Human Resource Planning

 work-force profile analysis

 work-force dynamics analysis

 Performance Management

 Training & Career Development

 Compensation & Benefits

 payroll

 job evaluation

 salary surveys & planning

 international compensation

 benefits management

 Staffing

 applicant recruiting & tracking

 EEO & AA reports

 Developing a master employee database

 Human Resource Planning

 work-force profile analysis

 work-force dynamics analysis

 Performance Management

 Training & Career Development

 Compensation & Benefits

 payroll

 job evaluation

 salary surveys & planning

 international compensation

 benefits management