HUMAN RESOURCE
M ANAGEMENT
SECOND
AN
B
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EXPERIENTIAL
E R N A R D I N
APPROACH
R
U S S E L L
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C H A P T E R
HRM IN A CHANGING ENVIRONMENT
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Chapter 1 Human Resource Management in a Changing Environment
Objectives
1. Increasing importance of HRM
2. Discrepancy between practice and research
3. Activities of HRM in context of eight domains:
4. Employee involvement in HRM programs
5. Trends
6. Measurement in HRM
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Figure 1.1: A Model of the HR-Shareholder Value Relationship
Employee
Skills
Business
and Strategic
Initiatives
Design of
Human
Resource
Management
System
Productivity
Employee
Motivation
Job Design
& Work
Structures
Creativity
Improved
Operating
Performance
Profits Market
and
Value
Growth
Discretionary
Effort
Source: Becker, B.E., Huselid, M.A., Pickus, P.S. and Spratt, M.F. (1997). HR as a source of shareholder value: Research and recommendations.
Human Resource Management 36, 39-48. Copyright 1997. Reprinted with permission John Wiley & Sons, Inc. 605 Third Ave., New
York, NY 10157-0228.
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Figure 1.2 Sample of Discrepancies Between Academic Research Findings and
HRM Practices
Academic Research Findings
HRM Practice
Recruitment
Use of Yield Ratios
Less than 5% use yield ratios
Less than 20% know how
Staffing
Realistic Job Previews
Less than 5 % use RJP in
high turnover jobs
Weighted Application Blanks
Less than 10% know what a
WAB is; less than 1% use
Structured, behavioral, or
18% use structured interviews
situational interviews
Statistical Models
Less than 5% use actuarial
No Graphology
Use is on the increase
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Figure 1.2 Sample of Discrepancies Between Academic Research
Findings and HRM Practices (continued)
Academic Research Findings
HRM Practice
Performance Appraisal
No Traits
More than 75% use traits
Train Raters
Less than 24% train raters
Accountable for appraisals
Less than 30% of managers are evaluated
on appraisals given
Merit pay not in base
Gainsharing
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Compensation
More than 75% tie merit into base pay
Less than 5% use it
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Figure 1.3: Major Domains/Activities of Human Resource Management
Organizational Design
Staffing
• HR planning
• Recruiting/interviewing/hiring
• Job analysis
• Affirmative action
• Job design
• Promotion/transfer/separation
• Work teams (Sociotechnical
systems)
• Induction/orientation
• Employee selection methods
• Information systems
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Figure 1.3: Major Domains/Activities of Human Resource Management
(continued)
Employee Training and Organizational
Development
• Management/supervisory development
• Career planning/development
• Employee assistance/counseling
programs
• Skill training, nonmanagement
• Retirement preparation programs
• Attitude surveys
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Employer/Employee Relations
•
•
•
•
•
•
Labor relations
Collective bargaining
Employee grievances
Alternative dispute resolution
Attitude surveys
Employee
communications/publications
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Figure 1.3: Major Domains/Activities of Human Resource
Management (continued)
Reward Systems and Benefits
Productivity Improvement Programs
• TQM programs
• Quality circles
• Productivity/enhancement programs
• Suggestion systems
• Teambuilding
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•
•
•
•
•
•
Safety programs/OSHA compliance
Health/medical services
Complaint/disciplinary procedures
Compensation administration
EEO compliance
Wage/salary administration· Insurance
benefits administration
• Unemployment compensation
administration
• Pension/profit sharing plans
• Outplacement services
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Figure 1.3: Major Domains/Activities of Human Resource
Management (continued)
Health and Safety
Performance Appraisal and
Management
• Management appraisal/MBO
• Customer-focused performance
appraisal
• OSHA compliance
• Accident prevention
• Stress reduction
• Wellness programs
• Employee assistance/counseling
programs
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Figure 1.4: Contemporary Trends That Affect HRM
Trend 1:
Concern over productivity
Trend 2:
The need to be flexible in response to changing business
environments
Trend 3:
Increasing international competition and the expanding global
economy
Trend 4:
Increase litigation related to HRM
Trend 5:
Changing characteristics of the workforce
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Figure 1.5: Unique Challenges in International Joint Ventures
HR Activity
Staffing
Decision making
Communication
Compensation
Career planning
Performance management
Training
HRM Challenge
Host country may demand staffing policies contrary to
maximizing profits.
Conflicts among diverse constituent groups; complexity of
decision processes.
Interpersonal problems due to geographical dispersion and cultural
differences.
Perceived and real compensation differences.
Perceptions regarding value of overseas assignments; difficulties
in reentry.
Differences in standards; difficulties in measuring performance
across countries.
Special training for functioning in international joint ventures
(IJV) structure.
Source: Adapted from O. Shenkar and Y. Zeira, Human resource management in international joint ventures: Directions for research. Academy
of Management Review, 12, 1987, 546-557. Reprinted with permission.
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Table 1.1.1 Most Common Private Sector Problems
More common problems in service organizations are marked by an asterisk (*).
Ensuring compliance with regulatory agencies and laws (EEOC, new ADA
requirements, OSHA)
Employee staffing and EEO*
Training management and effectiveness
Effective customer service*
Job dissatisfaction/employee attitudes
Preemployment screening
Need for methods to improve performance*
Lack of employee motivation*
Negligent hiring
Ineffective performance appraisals*
Increasing levels of teamwork
Recruitment and retention*
Health care costs
Establishment of drugfree workplace policy
Pension plans
Effective pay for performance systems*
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Table 1.1.1 (continued)
Most Common Public Sector Problems
Workload increase/workforce freeze and reduction
Excessive health care costs and sick leave
Training program evaluation
EEO compliance --- new ADA regulations
Affirmative action programs --- line management resistance
Computer reporting programs
Competitive salaries
Benefit administration
Computer training
Safety programs
Greater technical skills
Incentive compensation program
Insufficient funding
Child care
Terminating employees
Injury compensation costs
Union demands
Invalid performance appraisals
Ineffective pay for performance
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Chapter 1 Important Terms
• Productivity
• Staffing
• Productivity growth rate
• Reward systems, benefits, and
compliance
• Malcolm Baldrige National Quality
Awards
• Diversity
• Structural unemployment
• Job skills gap
• Organization design
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• Employee and organizational
development
• Performance management
• Effectiveness
• Efficiency
• Effectiveness criteria
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