HUMAN RESOURCE

MANAGEMENT
The Strategic Management Process
The Management Planning Process
• The basic management planning process consists of five steps:
I. setting objectives,
II. making basic planning forecasts,
III. reviewing alternative courses of action,
IV. evaluating which options are best,
V. then choosing and implementing your plan
• A plan shows the course of action for getting from where you are to the goal
• Planning is always “ goal-directed” (such as, “double sales revenue to $16 million in
fiscal year 2017”)
• In companies, it is traditional to view the goals from the top of the firm down to
front-line employees as a chain or hierarchy of goal
The Strategic Management Process
• The strategic management process includes seven steps:
i. ask, “What business are we in now?
ii. evaluate the firm’s internal and external strengths, weaknesses, opportunities, and threats
(SWOT analysis)
iii. formulate a new business direction (Vision and mission statements)
iv. decide on strategic goals
v. choose specific strategies or courses of action
vi. implement the strategic plan
vii. evaluate the strategic plan
• The process starts by defining the company’s current business. Specifically, “What products do we
sell, where do we sell them, and how do our products or services differ from our competitors’?
• For example, the Coca-Cola Company sells mostly sweetened beverages such as Coke and Sprite,
while PepsiCo sells drinks but also foods such as Quaker Oats and chips
• The second step is to ask, “Are we in the right business given our strengths and
weaknesses and the challenges that we face?” To answer this, managers “audit” or
study both the firm’s environment and the firm’s internal strengths and
weaknesses. It involves SWOT analysis and PEST analysis. The environmental scan
worksheet guides for compiling information about the company’s environment, this
includes the economic, competitive, and political trends that may affect the
company
• SWOT analysis: is a strategic planning and strategic management technique used
to help a person or organization identify Strengths, Weaknesses, Opportunities,
and Threats related to business competition or project planning
• PEST analysis: is a measurement tool which is used to assess markets for a
particular product or a business at a given time frame. PEST stands for Political,
Economic, Social, and Technological factors
• the task in step 3 will be to decide what should our new business be, in
terms of what we sell, where we will sell it, and how our products or
services differ from competitors’ products and services? Some managers
express the essence of their new business with a vision statement
• Vision statement: A general statement of the firm’s intended direction; it
shows, in broad terms, “what we want to become
• Whereas the vision statement describes in broad terms what the business
should be, the company’s mission statement summarizes what the
company’s main tasks are today
• Mission statement: Summarizes the answer to the question, “What
business are we in?
• the manager’s next step (step 4) is to translate the desired new direction
into strategic goals
• Next, (step 5) the manager chooses strategies, courses of action, that will
enable the company to achieve its strategic goals
• Step 6, strategy execution, means translating the strategies into action. This
means actually hiring (or firing) people, building (or closing) plants, and
adding (or eliminating) products and product lines
• Finally, in step 7, the manager evaluates the results of planning and
execution
• Things don’t always turn out as planned. All managers should periodically
assess the progress of their strategic decisions
Types of Strategy
• Managers are usually engaged in three types or levels of strategic planning
1. Corporate-level strategy: type of strategy that identifies the portfolio of
businesses that, in total, comprise the company and the ways in which these
businesses relate to each other. For example, single-business corporate
strategy, diversification corporate strategy
2. Competitive strategy: a strategy that identifies how to build and strengthen the
business’s long-term competitive position in the marketplace. Competitive
advantage: Any factors that allow an organization to differentiate its product or
service from those of its competitors to increase market share
3. Functional strategy: a strategy that identifies the broad activities that each
department will pursue in order to help the business accomplish its
competitive goals
Managers’ Roles in Strategic
Planning
• Devising the company’s overall strategic plan is top management’s
responsibility
• Few top executives formulate strategic plans without lower-level
managers’ input
• The human resource manager is in a good position to supply competitive
intelligence, information on competitors like details regarding
competitors’ incentive plans, employee opinion surveys about customer
complaints, and information about pending legislation such as labor laws
are examples
• Human resource managers should also be the masters of information
about their own firms’ employees’ strengths and weaknesses
Strategic Human Resource
Management
• Strategic Human Resource Management: formulating and executing
human resource policies and practices that produce the employee
competencies and behaviors the company needs to achieve its
strategic aims
• the manager formulates strategic plans and goals
• then asks, “What employee skills and behaviors will we need to
achieve these plans and goals?
• finally asks, “Specifically what recruitment, selection, training, and
other HR policies and practices should we put in place so as to
produce the required employee skills and behaviors
Strategic Human Resource
Management Tools
• Managers use several tools to translate the company’s strategic goals
into human resource management policies and practices. Like:
• The strategy map: a strategic planning tool that shows the “big
picture” of how each department’s performance contributes to
achieving the company’s overall strategic goals
• The HR scorecard: a process for assigning financial and nonfinancial
goals or metrics to the human resource management related chain of
activities required for achieving the company’s strategic aims and for
monitoring results. The HR scorecard is not a scorecard.
The HR scorecard……..
• Managers use special scorecard software to facilitate this
• The computerized scorecard process helps the manager quantify the
relationships between the followings:
I. the HR activities (amount of testing, training, and so forth)
II. the resulting employee behaviors (customer service, for instance)
III. the resulting firm-wide strategic outcomes and performance (such as
customer satisfaction and profitability)
• The HR scorecard derives from the “balanced scorecard” a planning
approach, which aims to balance hard data such as financial measures with
soft data such as customer satisfaction in assessing a company’s performance
• The digital dashboard: The saying “a picture is worth a thousand
words” explains the purpose of the digital dashboard. It presents the
manager with desktop graphs and charts, and so a computerized
picture of where the company stands on all those metrics from the HR
scorecard process.
What Are HR Audits?
• Human resource managers often collect data on matters like employee turnover
and safety via human resource audits
• One practitioner calls an HR audit “an analysis by which an organization
measures where it currently stands and determines what it has to accomplish to
improve its HR function
• The HR audit generally involves using a checklist to review the company’s human
resource functions (recruiting, testing, training, and so on), as well as ensuring
that the firm is adhering to regulations, laws, and company policies
• The HR auditor may first review payroll data, focusing on what and when each
employee was paid. He or she will then turn to whether the human resource
records are in order (for instance, are medical records kept separate from
résumés?).
Jon Analysis
• Talent management starts with understanding what jobs need to be
filled, and the human traits and competencies employees need to do
those jobs effectively
• Organizations consist of positions that have to be staffed
• The organization chart shows the title of each supervisor’s position
and who is accountable to whom, who has authority for each area,
and who is expected to communicate with whom
• Job analysis: It is the procedure through which you determine the
duties of the company’s positions and the characteristics of the
people to hire for them
• Job analysis produces information for writing job descriptions (a list of
what the job entails) and job (or “person”) specifications (what kind
of people to hire for the job)
• Virtually every personnel-related action—interviewing applicants,
training, appraising employees etc., requires knowing what the job
entails and what human traits one needs to do the job well
• The supervisor or human resources specialist normally collects one or more of the
following types of information via the job analysis:
I. Work activities: Information about the job’s actual work activities, such as
cleaning, selling, teaching, or painting. This list may also include how, why, and
when the worker performs each activity
II. Human behaviors: Information about human behaviors the job requires, like
sensing, communicating, lifting weights, or walking long distances
III. Machines, tools, equipment, and work aids: Information regarding tools used,
materials processed, knowledge dealt with or applied (such as finance or law),
and services rendered (such as counseling or repairing)
IV. Performance standards: Information about the job’s performance standards (in
terms of quantity or quality levels for each job duty, for instance).
V) Job context: Information about such matters as physical working
conditions, work schedule, incentives, and, for instance, the number of
people with whom the employee would normally interact
VI) Human requirements: Information such as knowledge or skills
(education, training, work experience) and required personal attributes
(aptitudes, personality, interests)
Uses of Job Analysis Information
• Job analysis is important because it supports different HRM activities:
• Recruitment and Selection: Information about what duties the job entails and what human
characteristics are required to perform these duties helps managers decide what sort of people to
recruit and hire
• EEO Compliance: Job analysis is crucial for validating all major human resources practices. For
example, to comply with the Americans with Disabilities Act, employers should know each job’s
essential job functions—which in turn requires a job analysis
• Performance Appraisal: A performance appraisal compares each employee’s actual performance with
his or her duties and performance standards. Managers use job analysis to learn what these duties
and standards are
• Compensation: Compensation (such as salary and bonus) usually depends on the job’s required skill
and education level, safety hazards, degree of responsibility, and so on—all factors you assess through
job analysis
• Training: The job description lists the job’s specific duties and requisite skills—thus pinpointing what
training the job requires
Conducting a Job Analysis
• There are six steps in doing a job analysis of a job, as follows
• Step 1: Decide How You Will Use the Information: Some data collection
techniques— like interviewing the employee—are good for writing job
descriptions. Other techniques, like the position analysis questionnaire
we describe later, provide numerical ratings for each job; these can be
used to compare jobs for compensation purposes
• Step 2: Review Relevant Background Information About the Job, Such as
Organization Charts and Process Charts: It is important to understand
the job’s context. For example, organization charts show the
organization wide division of work, and where the job fits in the overall
organization
• Process chart: A workflow chart that shows the flow of inputs to and
outputs from a particular job. A process chart provides a detailed
picture of the workflow. In the process chart, the quality control clerk
should review components from suppliers, check components going
to the plant managers, and give information regarding the
components’ quality to these managers. Finally, an existing job
description may provide a starting point for revising the job
description
Conducting a Job Analysis------
• Workflow Analysis: Reviewing the organization chart, process chart, and
job description helps the manager identify what a job’s duties and
demands are now
• However, it does not answer questions like “Does how this job relates to
other jobs make sense?” or “Should this job even exist?” To answer such
questions, the manager may conduct a workflow analysis
• Workflow analysis is a detailed study of the flow of work from job to job in
one identifiable work process (such as processing a mortgage application)
• In turn, this analysis may lead to changing or “reengineering” the job
• The accompanying HR as a Profit Center feature illustrates workflow
analysis
• In conducting a workflow analysis, the manager may use a flow
process chart; this lists in order each step of the process. The
manager may convert this step-by-step flow process chart into a
diagrammatic process chart. This shows, with arrows and circles, each
step in the process
Conducting a Job Analysis-------
Business Process Reengineering
• The workflow analysis at American Atlantic led to a reengineering of its claims processing operation.
• Business process reengineering means redesigning business processes, usually by combining steps,
so that small multifunction teams, often using information technology, do the jobs formerly done by
a sequence of departments
• The basic reengineering approach is to:
i. Identify a business process to be redesigned (such as processing an insurance claim)
ii. Measure the performance of the existing processes
iii. Identify opportunities to improve these processes
iv. Redesign and implement a new way of doing the work
v. Assign ownership of sets of formerly separate tasks to an individual or a team who use new
computerized systems to support the new arrangement
• As at Atlantic American, reengineering usually requires redesigning individual jobs. For example,
workers doing date stamping must now know how to use the new date-stamping machine
Conducting a Job Analysis---------
Job Redesign
• Early economists believed that specialized jobs were more efficient (practice
makes perfect). Today, most agree that specialized jobs can backfire
• three ways to redesign specialized jobs to make them more challenging
I. Job enlargement: means assigning workers additional same-level activities.
Thus, the worker who previously only bolted the seat to the legs might attach
the back too
II. Job rotation: means systematically moving workers from one job to another
III. Job enrichment: means redesigning jobs in a way that increases the
opportunities for the worker to experience feelings of responsibility,
achievement, growth, and recognition—and therefore more motivation. It does
this by empowering the worker—for instance, by giving the worker the skills
and authority to inspect the work, instead of having supervisors do that
Conducting a Job Analysis------
• Step 3: Select Representative Positions: With a job to analyze, the manager
then generally selects a sample of positions to focus on. For example, to
analyze an assembler’s job, it is usually unnecessary to analyze the jobs of
all the firm’s 200 assembly workers; instead a sample of 10 jobs will do
• Step 4: Actually Analyze the Job In brief: the actual job analysis involves
greeting each job holder; briefly explaining the job analysis process and the
participants’ roles in this process; spending about 15 minutes interviewing
the employee to get agreement on a basic summary of the job; identifying
the job’s broad areas of responsibility, such as “calling on potential clients”;
and then interactively identifying specific duties/tasks within each area
using the following methods…..
• Make the job analysis a joint effort by a human resources manager, the
worker, and the worker’s supervisor. The human resource manager might
observe the worker doing the job, supervisor and worker fill out job
questionnaires. Then he or she lists the job’s duties and required human
traits. The supervisor and worker then verify the HR manager’s list of job
• Make sure the questions and the process are both clear to the
employees. (For example, some might not know what you mean when
you ask about the job’s “mental demands.”)
• Use several job analysis methods. For example, a questionnaire might
miss a task the worker performs just occasionally. Therefore it’s prudent
to follow up the questionnaire with a short interview.
Conducting a Job Analysis------
• Step 5: Verify the Job Analysis Information with the Worker
Performing the Job and with His or Her Immediate Supervisor: This
will help confirm that the information (like on the job’s duties) is
factually correct and complete and help to gain their acceptance
• Step 6: Develop a Job Description and Job Specification: The job
description lists the duties, activities, and responsibilities of the job,
as well as its important features, such as working conditions. The job
specification summarizes the personal qualities, traits, skills, and
background required for getting the job done
Methods for collecting Job Analysis
information
• There are many ways (interviews, or questionnaires) to collect job information. The basic rule is to
use those that best fit your purpose.
• Thus an interview might be best for creating a list of job duties. The more quantitative “position
analysis questionnaire” method may be best for quantifying each job’s worth for pay purposes
1. The Interview:
• Job analysis interviews range from unstructured (“tell me about your job”) to highly structured ones
containing hundreds of specific items to check off.
• Managers may conduct individual interviews with each employee, group interviews with groups of
employees who have the same job, and/or supervisor interviews with one or more supervisors who
know the job
• Use group interviews when a large number of employees are performing similar or identical work,
since this can be a quick and inexpensive way to gather information
• As a rule, the workers’ immediate supervisor attends the group session; if not, you can interview
the supervisor separately
• Typical Questions: Typical interview questions include the following:
I. What is the job being performed?
II. What exactly are the major duties of your position?
III. What physical locations do you work in?
IV. What are the education, experience, skill, and [where applicable] certification and licensing requirements?
V. In what activities do you participate?
VI. What are the job’s responsibilities and duties?
VII. What are the basic accountabilities or performance standards that typify your work?
VIII. What are your responsibilities?
IX. What are the environmental and working conditions involved?
X. What are the job’s physical demands?
XI. The emotional and mental demands?
XII. What are the health and safety conditions?
XIII. Are you exposed to any hazards or unusual working conditions?
• Structured Interviews: Many managers use questionnaires to guide
the interview. It includes questions regarding matters like the general
purpose of the job; supervisory responsibilities; job duties; and
education, experience, and skills required.
• Pros And Cons:
i. Its advantages include It’s a simple and quick way to collect
information. Skilled interviewers can also unearth important
activities that occur only occasionally, or informal contacts that
aren’t on the organization chart. The employee can also vent
frustrations that might otherwise go unnoticed.
• ii) Disadvantages: Distortion of information is the main problem,
employees view it as pay-related, and exaggerate some
responsibilities while minimizing others, take job duties either as
simple task statements or as ability statements, report the ability-
based versions of the statements. It has also been reported that
people inflate their job’s importance when talk about abilities to
impress the perceptions of others. Employees will even puff up their
job titles to make their jobs seem more important
Questionnaires
• Having employees fill out questionnaires to describe their job duties and
responsibilities is another good way to obtain job analysis information.
• Some questionnaires are structured checklists. Here each employee gets
an inventory of perhaps hundreds of specific duties or tasks
• At the other extreme, the questionnaire may simply ask, “describe the
major duties of your job
• In practice, the best questionnaire often falls between these two extremes.
A typical job analysis questionnaire might include several open ended
questions, such as “give a brief description of the main function/purpose of
your job?, as well as structured questions (concerning, for instance,
education required).
• Advantages: a questionnaire is a quick and efficient way to obtain
information from a large number of employees
• it’s less costly than interviewing hundreds of workers
• Disadvantages: developing the questionnaire and testing it (by making
sure the workers understand the questions) can be time-consuming
• employees may distort their answers
Observations
• Direct observation is especially useful when jobs consist mainly of observable physical
activities like assembly-line worker and accounting clerk
• observation is usually not appropriate when the job entails a lot of mental activity (lawyer,
design engineer)
• Nor is it useful if the employee only occasionally engages in important activities, such as a
nurse who handles emergencies
• Reactivity—the worker’s changing what he or she normally does because you are watching
—is another problem
• Managers often use direct observation and interviewing together
• One approach is to observe the worker on the job during a complete work cycle. It could be
a minute for an assembly-line worker or an hour, a day, or longer for complex jobs.
• take notes of all the job activities then, ask the person to clarify open points and to explain
what other activities he or she performs that you didn’t observe
Participant Diary/Logs
• It is another method to ask workers to keep a diary/log
• here for every activity engaged in, the employee records the activity
(along with the time) in a log
• Some firms give employees pocket dictating machines and pagers for
keeping record
• Then at random times during the day, they page the workers, who
dictate what they are doing at that time
Quantitative Job Analysis Techniques
• Qualitative methods like interviews and questionnaires are not always
suitable
• For example, if your aim is to compare jobs for pay purposes, a mere
listing of duties may not suffice, e.g. Job A is twice as challenging as
Job B, and so is worth twice the pay
• to do this, one need to have quantitative ratings for each job
• position analysis questionnaire and the Department of Labor
approach are quantitative methods for doing this
• Position analysis questionnaire (PAQ):
• A questionnaire used to collect quantifiable data concerning the duties and responsibilities of ­
various jobs
• is a very popular quantitative job analysis tool, consisting of a questionnaire containing 194 items
• each represent a basic element that may play a role in the job
• each belong to one of five PAQ basic activities:
1. Having Decision-Making/Communication/Social Responsibilities
2. Performing Skilled Activities,
3. Being Physically Active
4. Operating Vehicles/Equipment
5. Processing Information
• The final PAQ “score” reflects the job’s rating on each of these five activities. To get those scores, the
job analyst decides if each of the 194 items applies to the job and, if so, to what extent
• Department of Labor (DOL) Procedure:
• Experts at the U.S. Department of Labor did much of the early work
developing job analysis
• They used their results to compile what was for many years the bible of
job descriptions, the Dictionary of Occupational Titles
• This mammoth book contained detailed information on virtually every
job in America
• Internet-based tools have largely replaced the Dictionary
• However, the U.S. Department of Labor job analysis procedure remains a
good example of how to quantitatively rate, classify, and compare jobs
Electronic Job Analysis Methods
• Employers increasingly rely on electronic or Web-based job analysis methods
• the manager or job analyst use the Web to review existing information about a job
• rather than collecting information about a job through direct interviews or
questionnaires, the analyst uses online systems to send job questionnaires to job
experts (often job incumbents) in remote locations
• the Web also facilitates sharing and discussing responses, via Skype etc
• the job analyst may thereby convene job experts to discuss and finalize the
knowledge, skills, abilities, and other characteristics required for doing the job
• the human resource department can distribute standardized job analysis
questionnaires to geographically disbursed employees via their company intranets,
with instructions to complete the forms and return them by a particular date