Human Resource Management: Gaining a Competitive Advantage – Chapter 1

A company’s ability to maintain and gain market share in its industry
Human resource management (HRM)
Policies, practices, and systems that influence
employees’ behavior, attitudes, and performance.
Human Resource Management Practices
1. Analysis and design of work
2. HR planning
3. Recruiting
4. Selection
5. Training and development
6. Compensation
7. Performance management
8. Employee relations
Responsibilities of HR Departments
1. Employment and recruiting
2. Training and development
3. Compensation
4. Benefits
5. Employee services
6. Employee and community relations
7. Personnel records
8.Health and safety
9.Strategic planning
HR as a Business with Three Product Lines
1.Administrative Services and Transactions: Compensation, hiring and staffing
2. Business Partner Services: Developing effective HR systems and helping implement business plans, talent management
3.Strategic Partner: Contributing to business strategy based on considerations of human capital, business capabilities, readiness, and developing HR practices as strategic differentiators
Six Competencies for the HR Profession
1. Credible Activist (most important)
2. Cultural Steward
3. Talent Manager/ Organizational Designer
4. Strategic Architect
5. Business Ally
6. Operational Executor
Two important challenges faced by HR managers
1. Shifting their focus from current operations to strategies for the future. This shift presents two challenges: self-service and outsourcing.
2. Preparing non-HR managers to develop and implement human resource practices
Giving employees online access to HR information
The practice of having another company (a vendor, third-party provider, or consultant) provide services
HR responsibilities most likely to be outsourced completely
1. Employee assistance and counseling
2. Flexible spending account administration
3. Background and criminal background checks
Strategic business issues that HR might help address
1. Identifying new business opportunities
2. Assessing possible merger, acquisition, or divestiture
3. Working on recruiting and developing talent
Evidence-based HR
Demonstrating that human resources practices have a positive influence on the company’s bottom line or key stakeholders (employees, customers, community, shareholders)
What question should you ask to evaluate the relationship between HRM and the business strategy?
What is HR doing to ensure that the right people with the right skills are doing the right things in the jobs that are important for the execution of the business strategy?
Why have HRM roles changed?
Managers see HRM as the most important lever for companies to gain a competitive advantage over both domestic and foreign competitors.
Is time spent on administrative tasks increasing or decreasing?
Time spent on administrative tasks is decreasing.
Which HR roles are increasing?
HR roles as a strategic business partner, change agent and employee advocate are increasing.
3 Competitive Challenges Influencing HRM
1. Technology
2. Sustainability
3. Globalization
A company’s ability to make a profit without sacrificing the resources of its employees, the community, or the environment.
Knowledge workers
Employees who contribute to the company not through manual labor, but through what they know about customers or a specialized body of knowledge.
Intangible assets
A type of company asset including human capital, customer capital, social capital, and intellectual capital.
Giving employees responsibility and authority to make decisions regarding all aspects of product development or customer service.
Learning organization
A culture of lifelong learning, enabling all
employees to continually acquire and share knowledge
Psychological contract
Expectations of employee contributions and what the company will provide in return
Employee engagement
The degree to which employees are fully involved in their work and the strength of their commitment to their job and the company
Talent management
A systematic planned strategic effort by companies to attracting, retaining, developing and motivating highly skilled employees and managers
Alternative work arrangements
Independent contractors, on-call workers, temporary
workers, and contract company workers who are not employed full-time by the company.
Balanced Scorecard
A means of performance measurement that gives managers a chance to look at their company from the perspectives of internal and external customers, employees, and shareholders.
The balanced scorecard should be used to _____?
1. Link human resource management
activities to the company’s business strategy
2. Evaluate the extent to which
the HRM function is helping the company meet its strategic objectives
Total quality management
A cooperative form of doing business that relies on the talents and capabilities of both labor and management to continually improve quality and productivity.
Malcolm Baldrige National Quality Award
An award established in 1987 to promote quality awareness, to recognize quality achievements of U.S. companies, and to publicize successful quality strategies.
ISO 9000:2000
Quality standards, developed by the International Organization
for Standardization (ISO) in Geneva, Switzerland, adopted worldwide
Six Sigma Process
System of measuring, analyzing, improving, and controlling processes once they meet quality standards.
Lean Thinking
A process used to determine how to use less effort, time, equipment, and space but still meet customers’ requirements.
Internal Labor Force
Labor force of current employees
External Labor Market
Persons outside the firm who are actively seeking employment.
Changing Demographics and Diversity of the Workforce
-Aging of the workforce
-Increased diversity of workforce
-Influence of immigration
Skills to successfully manage a diverse workforce
1. Communicating effectively with employees from a wide variety of cultural backgrounds
2. Coaching and developing employees of different ages, educational backgrounds, ethnicity, physical ability, and race
3. Providing performance feedback that is based on objective outcomes rather than values and stereotypes that work against women, minorities, and handicapped persons by prejudging these persons’ abilities and talents
4. Creating a work environment that makes it comfortable for employees of all backgrounds to be creative and innovative
5. Recognizing and responding to generational issues
5 Legal Areas that Influenced HRM
1. Equal employment opportunity legislation
2. Employee safety and health
3. Employee pay and benefits
4. Employee privacy
5. Job security
Sarbanes-Oxley Act of 2002
A congressional act passed in response to illegal and unethical behavior by managers and executives. The Act sets stricter rules for business especially accounting practices including requiring more open and consistent disclosure of financial data, CEOs’ assurance that the data is completely accurate, and provisions that affect the employee-employer relationship (e.g., development of a code of conduct for senior financial officers)
Exporting jobs from developed countries to less developed countries
Exporting jobs to rural parts of the United States
High-performance work systems
Work systems that maximize the fit between the company’s social system and technical system.
Electronic human resource management (e-HRM)
The processing and transmission of digitized information used in HRM, including text, sound, and visual images from one computer or electronic device to another.
Human Resource Information System (HRIS)
A system used to acquire, store, manipulate, analyze, retrieve, and distribute HR information.
HR Dashboard
HR metrics such as productivity, absenteeism that are accessible by employees and managers through the company intranet or human resource information system.

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