Human resource management gaining a competitive advantage mcgraw hill chap005

Chapter 05Human Resource Planning and Recruitment Human Resource Management: Gaining a Competitive Advantage... Forecasting Stage of HR Planning  Determine Labor Demand derived from p

Chapter 05

Human Resource Planning and

Recruitment

Human Resource Management:

Gaining a Competitive Advantage

Forecasting Stage of HR

Planning

 Determine Labor Demand

derived from product/service demanded

external in nature

 Determine Labor Supply

promotions, turnover, retirements, etc.

transitional matrices identify employee

movements in different job categories over time to chart historical trends in company’s labor supply

useful for AA / EEO purposes

 Determine Labor Surplus or Shortage

Options for Reducing Expected

Labor Surplus Option Speed Human Suffering

Fast Fast Fast Fast Fast Slow Slow Slow

High High High Moderate Moderate Low

Low Low Low

1 Downsizing

2 Pay reductions

3 Demotions

4 Transfers

5 Work sharing

6 Hiring freeze

7 Natural attrition

8 Early retirement

Options for Avoiding Expected

Labor Surplus

Option Speed Revocability

Fast Fast Fast Slow Slow Slow Slow

Downsizing -planned elimination of large numbers of

personnel to enhance organizational competitiveness.

4 Reasons for Downsizing:

1 reduce labor costs

2 technological changes reduce need for labor*

3 mergers and acquisitions reduce bureaucratic

overhead

4 organizations change location of where they do

business

* Economy wide, capital spending ratio increased over 300% between

1990-Possible Negative Effects of

Downsizing

Long-term effects of an improperly managed

downsizing effort can be negative

 Lower long-term profit, performance and

productivity

 Loss of talent

 Disrupts social networks needed for creativity and innovation

Early Retirement Programs

 The average age of U.S workforce is

increasing.

 Baby boomers are not retiring early due to:

 improved health

 fear that Social Security will be cut

 mandatory retirement is outlawed

 collapse of the financial and housing markets made

it economically unviable to retire

 Many employers try voluntary attrition

among older workers through early retirement

Employing Temporary Workers

Hiring temporary workers helps eliminate a

labor shortage and affords flexibility needed to

operate efficiently during demand swings

3 Advantages:

1. Temporary workers free a company from

administrative tasks and financial burdens

2. Temporary workers are often times tested by

a temporary agency

3. Many temporary agencies train employees

before sending them to employers

Outsourcing and Offshoring

Outsourcing uses an outside organization for

a broad set of services

Offshoring is outsourcing where jobs leave

one country and go to another

To help ensure the success of outsourcing:

 Choose an established, large outsourcing

vendor

 Jobs that are proprietary or require tight

security should not be outsourced

Recruitment Sources

JOBS