Strategic Human Resource Management-REVIEWER

STRATEGIC HR MANAGEMENT
LESSON 1 3. NONFINANCIAL COMPENSATION – Satisfaction receives from

HUMAN RESOURCE MANAGEMENT the job itself or from the psychological or physical environment in
which the person works.
HRM is the utilization of individuals to achieve organizational
objectives. EMPLOYEE AND LABOR RELATIONS
 Labor relations is an HR activity which handles the job of
CHARACTERISTICS: collective bargaining when a labor union represents the
 Diverse and human capital as an asset. company’s employees.
 Unitarist rather than pluralist, individualistic rather than  Law requires to recognize a union and bargain with it in good
collective (approach to employee relations) faith if the firm’s employees want the union to represent
 Strategic with an emphasis on integration. them.
 A management-driven activity.  Internal employee relations comprise the HRM activities
 Commitment-oriented and focused on business values. associated with the movement of employees within the
organization such as promotions, demotion, terminations,
FUNCTIONS and resignation.
1. Staffing
2. Performance Management SAFETY AND HEALTH
3. Human Resources Development  Safety involves protecting employees from injuries caused
4. Compensation by work-related accidents.
5. Employee and Labor Relations  Health refers to the employees’ freedom from physical or
6. Safety and Health emotional illness.
 Human Resources Research These aspects of the job are important because employees who works
in a safe environment and enjoy good health are more likely to be
STAFFING - it is the process through which an organization ensures productive and yield long-term benefits to the organization.
that it always has the proper number of employees with the appropriate
skills in the right jobs, at the right time, to achieve organizational Human Resource Research
objectives. It is not a distinct HRM function yet, it pervade all functional areas, and
the researcher’s laboratory is the entire work environment. It is an
It involves: important key to developing the most productive and satisfied
 Job analysis workforce possible.
 Human resource planning
 Recruitment and selection
PERFORMANCE MANAGEMENT - it is a goal-oriented process that

is directed toward ensuring that organizational processes are in place
to maximize the productivity of employees, teams, and ultimately, the
organization.
It involves:
 Performance appraisal
HUMAN RESOURCES DEVELOPMENT

 A major function consists of:
 Training
 Development
 Organizational development
 Career planning
 Career development
 Performance management and appraisal
WHO PERFORMS HUMAN RESOURCE MANAGEMENT
EMPLOYEE COMPENSATION AND BENEFITS ACTIVITIES?
Compensation is the total of all rewards provided to employees in HUMAN RESOURCE PROFESSIONAL - an individual who normally
return for their services. It may be one or a combinations of the acts in an advisory or staff capacity, working with other managers to
following: help them address human resource matters.
1. DIRECT FINANCIAL COMPENSATION (CORE LINE MANAGERS - individuals who are directly involved in
COMPENSATION) – Pay that a person receives in the form of accomplishing the primary purpose of the organization, by assuming
wages, salaries, commissions, and bonuses. some tasks typically done by HR professionals.
2. INDIRECT FINANCIAL COMPENSATION (EMPLOYEE HR OUTSOURCING - process of hiring external HR professionals to
BENEFITS) – All financial rewards not included in direct do the HR work that was previously done internally.
compensation, such as paid vacations, sick leave, holidays, and  Discrete services outsourcing
medical insurance.  Business process outsourcing (BPO)
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HR SHARED SERVICE CENTER (SSC) - a center that takes routine, PROFESSION IN HR MANAGEMENT
transaction-based activities dispersed throughout the organization and  HR executives
consolidates them in one places.  HR generalists
PROFESSIONAL EMPLOYER ORGANIZATION (PEO) - a company  HR specialists
that leases employees to other business.  HR managers
 Instructional coordinators
ELEMENTS OF HUMAN RESOURCE MANAGEMENT
ENVIRONMENT LESSON 2
BUSINESS ETHICS & CORPORATE SOCIAL RESPONSIBILITIES
ETHICS - the discipline dealing with what is good and bad, right and
wrong, or with moral duty and obligation.
CORPORATE SOCIAL RESPONSIBILITY (CSR) - the implied,

enforced, or felt obligation of managers, acting in their official capacity,
to serve or protect the interests of groups other than themselves.
CORPORATE SUSTAINABILITY - focuses on the possible future

impact of an organization on society, including social welfare, the
economy, and the environment.
Business Ethics
 Business is not alone.
 There must be leaders who are able and willing to instill
ethics throughout the culture of organization.
 Ethical decisions are major and some are minor. But
decisions in small matters often set a pattern for the more
important decisions a manager makes.
IMPORTANCE OF HUMAN RESOURCE MANAGEMENT
Source of Ethical Guidance
“Maybe the best definition of company culture is what everyone
does when no one is looking.” 1. Religion 2. Law 3. Culture
– Max Caldwell, Managing Director at Towers Watson
LEGISLATING ETHICS
Although laws cannot mandate ethics, they may be able to identify the
IHRM THROUGH THE LENS OF CORPORATE CULTURE
baseline separating what is good and what is bad.
 It gives applicants and newcomers a sense of how to behave
and what they out to be doing.  Labor Code of the Philippines (Presidential Decree No.
442) - the law that governs employment practices and labor
 It influences the employees’ degree of satisfaction with the
relations in the Philippines.
job as well as the level and quality of their performance.
 Philippine Cooperative Code of 2008 (R.A. 9520) - the law
 It provides a degree of perception with the management on
governing the registrations, regulation and promotion of
how fit is the prospective employees with the firm’s culture
cooperatives in the Philippines.
or value system.
 Foreign Investments Act of 1991 (R.A. No. 7042) - the law
 It enables optimal use of employees to reach short-term
that governs foreign investments in the Philippines.
results for the organization.
 Securities Regulation Code of the Philippines (R.A. No.
 Through organization development, the company has the
8799) - the law that governs the registration and regulation
means of changing the corporate culture.
of securities, pre-need plans, and securities market
professionals – and the protection of shareholder interests
EMPLOYER BRANDING
in the Philippines.
1. Company Name - it is an extension of product or business
branding.  Task Reform Act of 1997 (Republic Act No. 8424) - the
law that governs the national taxation in the Philippines and
2. Logo Design - it is the firm’s corporate image or culture created
gives the Bureau of Internal Revenue (BIR) the power and
to attract and retain the type of employees the firm seeking.
duty to assess and collect national internal revenue taxes in
3. Importance - its values and standards guide most workers to
stay as both shares the same ideas and principles. the country.
 Consumer Act of the Philippines (Republic Act No.
ISSUES IN HR MANAGEMENT 7394) - the law that protects the interest of consumers in the
Philippines, promote their general welfare, and establish
 HR Management promises more than it can deliver.
standards of conduct for business and industry.
 The morality of HR Management.
 Intellectual Property Code of the Philippines (R.A.
 Small businesses often do not have a formal HR unit or an
8293) - the law that governs the registration of patents,
HRM specialist.
trademarks and copyright, and the enforcement of
 Cultural barriers.
intellectual property rights in the Philippines.
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 FREELANCE WORKERS PROTECTION ACT (BILL NO. ETHICS TRAINING
8817)  It should be part of a proactive, not creative, strategy.
- requires a contract, additional payments (such as night shift  Regular training builds awareness of common ethical issues
pay, and hazard pay), and measures to protect freelance and provides tools for effective problem-solving.
workers.  Ethics training should begin at the top and continue through
- penalize companies who pay their freelance workers more all levels in the organization. However, training should take
than 15 days beyond the agreed payment date, and into consideration the differences in these levels.
companies that retaliate against freelance workers for using
the law to seek just compensation. CORPORATE SOCIAL RESPONSIBILITY
 It is the model in which economic, social, and environmental
CREATING AN ETHICAL CULTURE AND A CODE OF ETHICS responsibilities are satisfied concurrently.
ETHICAL CULTURE  When a corporation behaves as if it has a conscience, it is
- Requires a foundation of practices that continue even when said to be socially responsible. CSR considers the overall
leaders change, for it to last. influence of corporations on society at large and goes
- It is made up of factors such as ethical leadership, beyond the interests of shareholders. It is how a company
accountability, and values. as a whole behaves toward society. In many companies,
- The climate with top management is fundamental to a social responsibility has moves from nice to do to must do.
company’s ethical culture. It is where it starts and continues
to middle managers, supervisors, and employees. CARROLL’S PYRAMID OF CORPORATE SOCIAL
RESPONSIBILITY
ETHICS AUDIT - it is a systematic, independent, and documented Carroll’s Pyramid of Corporate Social Responsibility helps to explain
process for obtaining evidence regarding the status of an the social, ethical, legal and economic responsibilities by which a
organization’s ethical culture. business should operate. A Master of Business Administration
program, like the one offered by Victoria University Online, can help
GOOD PEOPLE MUST BE EMPLOYED professionals understand the framework that helps a business function
ethically and sustainably through courses like Business Ethics and
FOSTER A STRONG ETHICAL CULTURE Sustainability.
 Organizations are redesigning their ethics program to
facilitate a broader and more consistent process that
incorporates the analysis of outcomes and continual
improvement. They need a comprehensive framework that
encompasses communication of behavior expectations,
training on ethics and compliance issues, stakeholder input,
resolution of reported matters, and analysis of the entire
ethics program.
 Larger firms appoint an ethics officer.
DISTINCTION OF CODE OF CONDUCT AND A CODE OF ETHICS

 The code of conduct should tell employees what the rules of
conduct are.
 The code of ethics helps employees know what to do when
there is not a rule for something. It typically covers business
conduct, fair competition, and workplace and HR issues.
 The code is a statement of the values adopted by the CORPORATE SUSTAINABILITY
company, its employees, and its directors and sets the It is “meeting the needs of the present without compromising the ability
official tone of top management regarding expected of future generations to meet their own needs.”
behavior. – World Commission on Environment and Sustainability
HUMAN RESOURCE ETHICS “An approach to creating long-term shareholder value by embracing
 It is the application of ethical principles to HR relationships opportunities and managing risks deriving from economic,
and activities. environmental and social trends and challenges.”
 HR should review, develop, and enforce organizational – Dow Jones World Sustainability Index (DJSI)
policies to ensure a high level of ethics throughout the
organization. All employees should know what is ethical and SOCIAL AUDIT - it is a systematic assessment of a company’s
unethical in their specific area of operations. It is insufficient activities in terms of its social impact. Included in its focus on core
to say that everyone should behave ethically. values such as social responsibility, open communication, treatment
of employees, confidentiality, and leadership.
LINKING PAY TO ETHICAL BEHAVIOR
“When employees behave in undesirable ways, it’s a good idea to look 3 POSSIBLE TYPES OF SOCIAL AUDITS ARE BEING USED:
at what you’re encouraging them to do.” 1. Simple inventory of activities.
2. Compilation of socially relevant expenditures; and
3. Determination of social impact.
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How CSR succeed in the Global environment? 4. HR expertise – the knowledge and skills that define the unique
- it may be easier to be socially responsible in a prospering economy contribution the HR professional can make to effective people
but more difficult when the economy is bad. management.
“Can firms competing in the global environment continue the lowest A. The internal consultancy role.
possible production costs while complying with national laws and being B. The monitoring role.
socially responsible?” C. The guardian of values role.
1. INSTITUTE OF HUMAN RESOURCE PROFESSIONALS MODELS OF THE PRACTITIONERS OF HR

2. INTERNATIONAL FEDERATION OF PROFESSIONAL
MANAGERS Karen Legge (1978). 2 Types of HR Managers:
3. CHARTERED PROFESSIONALS IN HUMAN RESOURCES 1. Conformist innovators – who go along with their
(CPHR) organization’s ends and adjust their means to achieve them.
Their expertise is used as a source of professional power to
THE ROLE OF HR FUNCTION improve the position if their departments.
Competency framework for HR Professionals: 2. Deviant innovators – who attempt to change this
 Business and cultural awareness. means/ends relationship by gaining acceptance for a
 Strategic capability. different set of criteria for the evaluation of organizational
 Organizational effectiveness. success and their contribution to it.
 Internal consultancy.
 Service delivery. The Tyson and Fell (1968) model. 3 Types of Practitioners:
 Continuous professional development. 1. The clerk of works – all authority for action is vested in the
 Service delivery. line managers. HR policies are created after the actions led
to the need. Policies are not integral to the business and are
 Continuous professional development.
short term and ad hoc. Authority is vested in line managers
and HR activities are largely routine – employment and day-
Chartered Institute of Personnel and Development (CIPD, 2009)
to-day administration.
listed competencies required by its professional members:
2. The contracts manager – policies are well established,
 Personal drive and effectiveness.
often implicit, with a heavy industrial relations emphasis,
 People management and leadership. possibly derived from an employers association. The HR
 Professional competence. manager is likely to be very experienced in industrial
 Adding value through people. relations; will not be on the board and, but have some
 Continuing learning. authority to ‘police’ the implementation of policies; acts
 Thinking and applied resourcefulness. mainly in an interpretative role.
 ‘Customer’ focus. 3. The architect – explicit HR policies exist as part of the
 Strategic capability. corporate strategy. Human resource planning and
 Influencing and interpersonal skills. development are important concepts and a long-term view
is taken. Systems tend to be sophisticated. The head of the
CONFLICT IN THE GR CONTRIBUTION can arise in the following HR function is probably on the board and his or her power is
ways: derived from professionalism and perceived contribution to
 A death of values. the business.
 Different priorities.
 Freedom versus control. Kathleen Monks (1992). 4 Types of Practitioner following research
 Disputes. in 97 organizations in Ireland extended those developed by Tyson
 Ambiguities in the role. and Fell:
 Traditional/administrative – the personnel have mainly a
BASIC ROLES OF AN HR PRACTITIONER support role with the focus on administrative matters, record-
 Service provision to internal customers. keeping and adherence to rules and regulations.
 Guidance and advice to management.  Traditional/industrial relations – practitioners’
 The business partner role. concentration on industrial relations, giving their other
functions lower priority.
 The strategist role.
 The innovation and change agent role.  Innovative/professional – specialists are professional and
expert. They aim to remove traditional practices and replace
Caldwell (2001) categorizes HR change agents in four dimensions them with improved human resource planning, recruitment
1. Transformational change – a major change that has a dramatic and development, and reward policies and practices.
effect on HR policy and practice across the whole organization.  Innovative/sophisticated – personnel specialists are on
2. Incremental change – gradual adjustments of HR policy and the board, take part in integrating HR and business
practices that affect single activities or multiple functions. strategies, and are recognized as making an important
3. HR vision – a set of values and beliefs that affirm the legitimacy of contribution to organizational success. They develop in each
the HR function as strategic business partner. of the main HR areas.
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John Storey (1992a). TYPES OF PERSONNEL MANAGEMENT LESSON 3
SYSTEMS AND STRATEGIC HUMAN RESOURCES
MANAGEMENT
STRATEGIC PLANNING is the process by which top management

determines overall organizational purposes and objectives and how
they are achieved.
 It is an ongoing process that is constantly changing to find a
competitive advantage.
HRM versus HR Strategies

The HR strategies guides HRM development and implementation
programme.
“There is no great strategy, only great execution.”
— Gratton, 2000
DEVELOPMENT PROCESS
LEVELS OF STRATEGIC DECISION-MAKING Purcell (1989)
1. ‘Upstream’ first order missions– concerned with the long-term
direction of the enterprise or the scope of its activities.
2. ‘Downstream’ second-order decisions – concerned with internal
operating procedures and how the firm is organized to achieve its
goals.
3. ‘Downstream’ third-order decisions – concerned with choices on
human resource structures and approaches and are strategic in sense
of establishing basic parameters of employee relations management.
APPROACHES TO STRATEGIC HRM

OVER-ALL RESOURCES BASED STRATEGIC HRM (PENROSE,
1959)
 Focuses on satisfying the human capital requirements of the
Dave Ulrich & Wayne Brockbank (2005a and 2005b) organizations.
Formulated the 1997 model in 2005, listing the following roles:  Developed by Hamel and Prahalad (1989), who declared
 Employee advocate – focuses on the needs of today’s that competitive advantage is obtained if a firm can obtain
employees through listening, understanding, and and develop Human Resources that enable it to learn faster
empathizing. and apply its learning more effectively than its rivals.
 Human capital developer – in the role of managing and  The aim of a resource-based approach is to improve
developing human capital (individuals and teams), focuses resource capability which can produce ‘human resource
on preparing employees to be successful in the future. advantage’ (Boxall and Purcell, 2003).
 Functional expert – concerned with the HR practices that
are central to HR value, acting with insight on the basis of (1) HIGH-PERFORMANCE MANAGEMENT APPROACH
the body of knowledge they possess. Some are delivered (STEVENS, 1998)
through administrative efficiency (such as technology or  Involves the development of a number of interrelated
process design), and others through policies, menus and processes which together make an impact on the
interventions. Necessary to distinguish between the performance of the firm through its people in such areas as
foundation of HR – practices, learning and development, productivity, quality, levels of customer service, growth
rewards, etc – and the emerging HR practices such as profits, and, ultimately, the delivery of increased shareholder
communications, work process, and organization design, value; can be achieved by ‘enhancing the skills and
and executive leadership development. engaging the enthusiasm of employees’.
 Strategic partner – consists of multiple dimensions:  May be expressed as a drive to develop a performance
business expert, change agent, strategic HR planner, culture in an organization.
knowledge manager and consultant, combining them to
align HR systems to help accomplish the organization’s (2) HIGH-COMMITMENT MANAGEMENT MODEL (WOOD, 1996)
vision and mission, helping managers to get things done, Described by Wood (1996):
and disseminating learning across the organization.  A form of management which is aimed at eliciting a
 Leader – leading the HR function, collaborating with other commitment so that behavior is primarily self-regulated
functions and providing leadership to them, setting and rather than controlled by sanctions and pressures external
enhancing the standards for strategic thinking and ensuring to the individual, and relations with the organization are
corporate governance. based on high levels of trust.
 It creates development of career ladders and emphasis on
traceability and commitment, a high level of functional
flexibility with the abandonment of potentially rigid job
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descriptions; reduction of hierarchies and the ending of THE CONFIGURATIONAL (BUNDLING APPROACH)
status differentials; heavy reliance on team structure for Figure 4.1 Strategic Planning Process
disseminating information (team briefing), structuring work Derivative of the SWOT framework but it is less structured.
(team working), and problem solving (quality circles).
(3) HIGH-INVOLVEMENT MANAGEMENT

 Involves treating employees as partners in the enterprise
whose interests are respected and who have a voice matters
that concern them. It is concerned with communication and
involvement. The aim is to create a climate in which a
continuing dialogue between managers and the members of
their teams take place to define expectations and share
information on the organization’s mission, values, and
objectives. This establishes mutual understanding of what is
to be achieved and a framework for managing and
developing people to ensure that it will be achieved.
TYPES OF HR STRATEGIES
(1) OVERARCHING HR STRATEGIES
Describe the general intentions of the organization expressed as
broad-brush statements of aims and purpose that set the scene for
more specific strategies. They are concerned with overall
organizational effectiveness.
(2) SPECIFIC HR STRATEGIES CRITERIA FOR AN EFFECTIVE HR STRATEGY

Set out what the organization intends to do in different areas of HR.  It will satisfy business needs.
 It is founded on detailed analysis and study, not just wishful
APPROACHES TO HR STRATEGIES DEVELOPMENT thinking.
DELERY AND DATY (1996) IDENTIFIED THE:  It can be into actionable programmes that anticipate
- universalistic - contingency - configurational implementation requirement s and problems.
 It is coherent and integrated, being composed of
RICHARDSON AND THOMPSON (1999) components that fit with and support each other.
- best practice approach - best fit approach - bundling approach  It takes account of the needs of EVERYONE.
THE BEST PRACTICE STRATEGY IMPLEMENTATION

 The assumption that there is a set of best HRM practices  It is the most difficult and important part of strategic
and that adopting them will inevitably lead to superior management. No matter how creative and well formulated
organizational performance. the strategic plan, the organization will not benefit of it is
 Criticisms: inconsistency, focuses on the intangible assets, incorrectly implemented. It requires changes in the
difficult and impossible. organization’s behavior, either one or more organizational
 Ensure the importance of HR strategies’ appropriateness to dimensions.
the circumstances of the organization, including its culture,
operational processes and external environment. The Human Resource Planning Process
 Benchmarking is useful to pick and mix various ‘best
practice’ ingredients and develop an approach that applies
those.
 Criticisms: the impossibility of modeling all the contingent
variables, the difficulty of showing their interconnection, and
how changes in one variable have an impact on others.
‘A strategy’s success turns on combining “vertical” or external fit and

“horizontal” or internal fit.’
- Bundle are development and implementation of several HR practices

together so that they are interrelated and therefore complement and
reinforcement each other.
Criticisms: deciding which is the best way to relate different practices
together.
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(CONT. OF STRATEGY IMPLEMENTATION) Job Analysis: A Basic Human Resource Management Tool
I. LEADERSHIP
II. ORGANIZATIONAL STRUCTURE
III. INFORMATION AND CONTROL SYSTEMS
IV. TECHNOLOGY
V. HUMAN RESOURCES
WORKFORCE PLANNING
1. REQUIREMENTS FORECAST – determining the number, skill, and
location of employees the organization will need at future dates to
meet its goals.
2. AVAILABILITY FORECAST – whether the firm will be able to
secure employees with the necessary skills, and from what sources.
FORECASTING HUMAN RESOURCE REQUIREMENTS

1. ZERO-BASED FORECAST – uses the organization’s current level I. Competencies and competency modeling.
of employment as the starting point for determining future staffing II. Concept of Job Design
needs.  Job enrichment
2. BOTTOM-UP FORECAST – each successive level in the  Job enlargement
organization, starting with the lowest, forecasts its requirements,  Job rotation
ultimately providing an aggregate forecast of employees needed.  Re-engineering
III. Global Talent Management
FORECASTING HUMAN RESOURCE AVAILABILITY
When shortage or surplus Workers Forecasted… LESSON 4
 INNOVATIVE RECRUITING – a shortage of personnel often DIVERSITY AND MULTICULTURALISM
means that new approaches to recruiting must be used.
 COMPENSATION INCENTIVES – premium pay is one DIVERSITY – refers to any actual or perceived difference among
obvious methods; however, this approach may trigger a people.
bidding war that the organization cannot sustain for an
extended period. UNLAWFUL EMPLOYMENT DISCRIMINATION
 ALTERNATIVES TO LAYOFFS – special training programs Disparate treatment – employer treats some employees less
may be needed to prepare previously unemployable favorably than others because of race, religion, color, sex, national
individuals for positions with a firm. Remedial education and origin, or age. It is the most easily understood form of discrimination.
skills training are programs that may help attract individuals. Adverse impact – occurs if women and minorities are not hired at
least 80 percent of the best-achieving group.
ALTERNATIVES TO LAYOFFS
To implement a restricted hiring policy that reduces the workforce by Republic Act No. 10524: EQUAL OPPORTUNITY FOR
not replacing employees who leave. EMPLOYMENT (2012) – no person with disability shall be denied
1. HARD FREEZE – no new workers are hired to replace a vacated access to opportunities for suitable employment. They shall be subject
position. to the same terms and conditions of employment with the others.
2. SOFT FREEZE – the company is only hiring to fill critical positions;
it is only when the overall performance of the organization may be Republic Act No. 9710: THE MAGNA CARTA OF WOMEN (2009) –
affected. the state that equality of men and women and that it shall develop
3. SMART FREEZE – HR and managers evaluate every position to plans, policies, programs, measures, and mechanisms to address
determine the ones the company could not survive without and discrimination and inequality in the economic, political, social, and
those that are difficult to fill and continue to hire them. cultural life of women and mean.
SUCCESSION PLANNING – the process of ensuring that qualified WHO’S RESPONSIBLE FOR ENSURING EOE?
persons are available to assume key managerial positions once the National Government and its department such as
positions are vacant.  Department Of Labor and Employment (DOLE)
 Its goal is to help ensure a smooth transaction and  Civil Service Commission (CSC)
operational efficiency, but the transition is often difficult.  National Council on Disability Affairs (NCDA)
 A firm might have a good succession plan for top-level  Governance Commission for Government-Owned or -
positions but few plans for the levels where all the work is Controlled Corporations (GCG)
performed.  Department of Health (DOH)
 Succession planning is often neglected in small business  Department of Social Welfare and Development (DSWD)
because it is generally thought of in terms of replacing CEOs  Bureau of Internal Revenue (BIR)
and key executives within larger businesses.
In consultation with the concerned Senate and House committees and
other agencies, organizations and establishments take responsibility
for establishing and supporting EOE.
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DIVERSITY MANAGEMENT Job Bidding – Procedure that permits employees who believe that
 It is ensuring that there is continued development of a they possess the required qualifications to apply for a posted position.
diverse workforce by combining actual and perceived  The job posting and bidding procedures can help minimize
differences among workers to achieve maximum the commonly heard complaint that insiders never hear of a
productivity. job opening until it is filled.
 Focuses on the principle that all workers regardless of any  Today, companies use the intranet, the Internet, or post the
factor are entitled to same privileges and opportunities. job on the company Web site or company Facebook page.
ELEMENTS OF THE DIVERSE WORKFORCE Employee Referral

 Single parents and Working mothers  An employee of the company recommends a friend or
 Women in Business associate as a possible member of the company; this
 Mothers returning to the Workforce (on Ramping) continues to be the way that top performers are identified.
– returnship Example: Organizations such as Southwest Airlines,
 Dual-career families Microsoft, Disney, and Ritz typically employ many of their
 Ethnic and Race new hires exclusively through employee referrals.
 Older Workers  Employee enlistment is a unique form of employee referral
 People with Disabilities in which every employee becomes a company recruiter.
 Immigrants, Foreign Workers
 Young Persons, Some with Limited Education or Skills EXTERNAL RECRUITMENT SOURCES
At times, a firm must look beyond its own borders to find employees,
 Multigenerational Diversity – Baby Boomers, Gen X, Gen
particularly when expanding its workforce. External recruitment is
Y, and Gen Z
needed to…
 Lesbian, gay, bisexual, and transgender (LGBT) employees
(1) Fill entry-level jobs;
(2) Acquire skills not possessed by current employees; and
LESSON 5 (3) Obtain employees with different backgrounds to provide a diversity
RECRUITMENT of ideas.
 High Schools and Vocational Schools – Some companies
Process of attracting individuals on a timely basis, in sufficient work with schools to ensure a constant supply of trained
numbers, and with appropriate qualifications to apply for jobs with an
individuals with specific job skills. In some areas, companies
organization.
even loan employees to schools to assist in the training
programs.
RECRUITMENT PROCESS
 Community Colleges – Many community colleges are
1. Employee Requisition – Document that specifies job title,
sensitive to the specific employment needs in their local
department, the date the employee is needed for work, and
labor markets and graduate highly sought-after students
other details.
with marketable skills.
2. Recruitment Sources – Where qualified candidates are
 Colleges and Universities – Establishing a relationship
located.
with faculty members is important because most professors
3. Recruitment Methods – are the specific means used to
are well aware of their students’ academic performance and
attract potential employees to the firm, such as online
abilities. Because on-campus recruitment is mutually
recruiting.
beneficial, both employers and universities should take
When a firm identifies the sources of candidates,
steps to develop and maintain close relationships. It is
it uses appropriate methods for either internal or external
important that the firm knows the school and the school
recruitment to accomplish recruitment objectives.
knows the firm.
Internal Recruitment Methods  Competitors in the Labor Market – When recent
Management should be able to identify current employees who are experience is required, competitors and other firms in the
capable of filling positions as they become available. Helpful tools same industry or geographic area may be the most
used for internal recruitment include human resource databases, job important source of recruits. Another name for actively
postings and job bidding, and employee referrals. recruiting employees from competitors is called poaching.
 Former Employees – Today’s young workers are more
Human Resource Databases likely to change jobs and later return to a former employer
Human resource databases permit organizations to determine than their counterparts who entered the workforce 20 or 30
whether current employees possess the qualifications for filling open years ago, and smart employers try to get their best ex-
positions. As a recruitment device, these databases have proven to be employees to come back. The boomerang effect might
extremely valuable to organizations. Databases can be valuable in happen because there was a strong bond with previous
locating talent internally and supporting the concept of promotion from coworkers or the new job was not what the employee
within. envisioned.
 Unemployed – The unemployed often provide a valuable
JOB POSTING AND JOB BIDDING source of recruits. Companies may downsize their
operations, go out of business, or merge with other firms,
Job Posting – Procedure for informing employees that job openings
leaving qualified workers without jobs.
exist.
 Military Personnel – Hiring former service members makes
sense to a lot of employers because many of these
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individuals have a proven work history and are flexible,  AllianceQ – Group of Fortune 500 companies, along with
motivated, and drug-free. more than 3,000 small and medium-sized companies, that
 They were found to be hardworking, smart, and intense; have collaborated to create a pool of job candidates.
they had leadership experience and were flexible. They  Niche Sites – Web sites that cater to highly specialized job
are prompt, used to reporting for work on time, and know markets such as a particular profession, industry, education,
the importance of a professional appearance and location, or any combination of these specialties.
presence.  Contingent Workers – Described as the “disposable
 Self-Employed Workers – Such individuals may constitute American workforce” by a former secretary of labor, have
a source of applicants for any number of jobs requiring a nontraditional relationship with the worksite employer, and
technical, professional, administrative, or entrepreneurial work as part-timers, temporaries, or independent
expertise within a firm. contractors.
 Ex-Offenders – Some organizations have found it beneficial  These disposable workers permit maximum flexibility for
to hire ex-offenders. the employer and lower labor costs. Historically,
 As an example, supermarket retail consultant and contingent workers have been called the bookends of
restaurateur Howard Solganik has launched a program recessions. They are the first to go when a recession
that puts ex-offenders to work helping area farmers begins and the last to be recalled when the economy gets
increase the supply of local, seasonal produce to better.
consumers. Solganik said, “My experience in the  Hourly Workers’ Sites – Most hourly workers pursue jobs
restaurant business exposed me to ex-offenders. I saw by filling out applications rather than creating and sending
that most were hard workers and also were grateful for out résumés. So sites allow job seekers to build an
the jobs they were given.” application that can be viewed by employers.
HR Internet Guides – www.hr-guide.com TRADITIONAL EXTERNAL RECRUITMENT METHODS

This Web site contains links to other Internet-based resources for topics such as
recruitment, selection, and equal employment opportunity.
Although online recruiting has greatly impacted how recruiting is
accomplished, traditional methods are not dead.
RECRUITING TECHNOLOGY  Media Advertising – Advertising communicates the firm’s
 Mobile Recruiting – Recruiters use mobile apps to post employment needs to the public through media such as
newspapers, trade journals, radio, television, and billboards.
jobs, run text message–based recruiting campaigns, create
online communities for potential new hires to learn about  Private Employment Agencies – Private employment
their companies, monitor social networks for news about agencies, often called “headhunters,” are best known for
industries they hire for, and keep in touch with staff and recruiting white collar employees and offer an important
outside agencies. service in bringing qualified applicants and open positions
together.
 Internet Recruiter – Person whose primary responsibility is
 Public Employment Agencies – Public employment
to use the Internet in the recruitment process (also called
agencies are operated by each state but receive overall
cyber recruiter).
policy direction from Employment Services.
 Virtual Job Fair – Online recruiting method engaged in by
 They typically use computerized job-matching systems to
a single employer or group of employers to attract a large aid in the recruitment process, and they provide their
number of applicant. services without charge to either the employer or the
 Corporate Career Web Sites – Job sites accessible from a prospective employee.
company home page that list available company positions  Executive Search Firms – Executive search firms are used
and provide a way for applicants to apply for specific jobs. by some firms to locate experienced professionals and
 Weblogs (Blogs for Short) – Weblogs, or blogs, have executives when other sources prove inadequate. The key
changed the ways in which individuals access information. benefit of executive search firms is the targeting of ideal
Some employers and employment agencies have also candidates. In addition, the executive search firm can often
discovered that blogging is a way to do detailed and stealthy find passive candidates, those not actively looking for a job.
background checks.  There are two types of executive search firms:
 General-Purpose Job Boards – Firms use general- contingency and retained.
purpose job boards by typing in key job criteria, skills, and 1) Contingency search firms – receive fees only on
experience, and indicating their geographic location. Job successful placement of a candidate in a job opening.
seekers can search for jobs by category, experience, 2) Retained search firms – are considered consultants to
education, location, or any combination of categories. their client organizations, serving on an exclusive
 NACElink network – The result of an alliance among the contractual basis, and typically recruit top business
National Association of Colleges and Employers, executives.
DirectEmployers Association, and Symplicity Corporation, it  Recruiters – Recruiters most commonly focus on technical
is a national recruiting network and suite of Web-based and vocational schools, community colleges, colleges, and
recruiting and career services automation tools serving the universities
needs of colleges, employers, and job candidates.  Job Fair – Recruiting method engaged in by a single
 .Jobs – Network of employment Web sites where any employer or group of employers to attract a large number of
company can list job openings for free. applicants to one location for interviews.
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 Internship – Special form of recruitment that involves Active or Passive Job Seekers
placing a student in a temporary job with no obligation either The recruitment method that proves to be most successful will depend
by the company to hire the student permanently or by the to an extent on whether the recruited individual is an active or passive
student to accept a permanent position with the firm job seeker.
following graduation.
a) Active Job Seekers – Individuals committed to finding another job
 Professional Associations – Virtually every professional whether presently employed or not.
group publishes a journal and has a Web site that is widely b) Passive Job Seekers – Potential job candidates, who are typically
used by its members. Many professional associations in employed, satisfied with their employer, and content in their current
business areas including finance, marketing, accounting, role but if the right opportunity came along, they might like to learn
and human resources provide recruitment and placement more.
services for their members.
 Unsolicited Applicants – A company must have a positive Legal Considerations – A poorly conceived recruiting process can do
image or employer brand to attract unsolicited applicants. If much to create problems in the selection process. Therefore, it is
an organization has the reputation of being a good place to essential for organizations to emphasize nondiscriminatory practices
work, it may be able to attract qualified prospects even at this stage.
without extensive recruitment efforts.
 Open Houses – Open houses pair potential hires and ALTERNATIVES TO RECRUITMENT
recruiters in a warm, casual environment that encourages Even when HR planning indicates a need for additional employees, a
on-the-spot job offers. There are pros and cons to holding a firm may decide against increasing the size of its workforce.
truly open house. If the event is open, it may draw a large
turnout, but it also may attract a number of unqualified  Promotion From Within (PFW) – Policy of filling vacancies
candidates. above entry-level positions with current employees.
 Event Recruiting – Recruiters going to events being  Overtime – Perhaps the most commonly used alternative to
attended by individuals the company is seeking. recruitment, especially in meeting short-term fluctuations in
 Sign-on Bonuses – Employers use sign-on bonuses to work volume, is overtime. Overtime may help both employer
attract top talent, particularly in high-demand fields such as and employee.
health care, sales, marketing, and accounting. Bonuses  The employer benefits by avoiding recruitment, selection,
allow a firm to pay a premium to attract individuals without and training costs. The employees gain from increased
dramatically upsetting its salary scale. income during the overtime period.
 Competitive Games – companies uses games as a  Onshoring – Moving jobs not to another country but to
recruiting tool. lower-cost U.S. cities.
 Example: Code Jam is an international programming
competition hosted and administered by Google. The GLOBAL IMPLICATIONS FOR RECRUITMENT
competition began in 2003 as a means to identify top Outsourcing, offshoring, and reshoring are three global activities that
engineering talent for potential employment at Google. affect recruitment activities.
The competition consists of a set of algorithmic problems 1) Outsourcing – Process of hiring an external provider to do the
that must be solved in a fixed amount of time. work that was previously done internally.
2) Offshoring – Migration of all or a significant part of the
TAILORING RECRUITMENT METHODS TO SOURCES development, maintenance, and delivery of services to a vendor
Because each organization is unique, so are the needed types and located in another country.
qualifications of workers to fill positions. Thus, to be successful, a firm 3) Reshoring – Reverse of offshoring and involves bringing work
must tailor its recruitment sources and methods to its specific needs. back to the United States.
 Managers must first identify the source (where prospective
employees are located) before choosing the methods (how LESSON 6
to attract them). It is likely that other firms, possibly SELECTION
competitors, employ such individuals.
 After considering the recruitment source, the recruiter must SIGNIFICANCE OF EMPLOYEE SELECTION
then choose the method (or methods) of recruitment that Selection – Process of choosing from a group of applicants the
offers the best prospects for attracting qualified candidates. individual best suited for a particular position and the organization.
ENVIRONMENT OF RECRUITMENT Selection Process

Factors external to the organization can significantly affect the firm’s 1) Companies make selection decisions to determine whether
recruitment efforts. individuals who were identified through the selection process will be
offered employment.
Labor Market Conditions – Of particular importance to the success 2) This process typically begins with preliminary screening. Next,
of recruitment is the demand for and supply of specific skills in the applicants complete the firm’s application for employment or provide
labor market. In general, a firm’s recruitment process is often simplified a résumé.
when the unemployment rate in an organization’s labor market is high. 3) Then they progress through a series of selection tests, one or more
 The number of unsolicited applicants is usually greater, and the employment interviews, and pre-employment screening, including
increased size of the labor pool provides a better opportunity for background and reference checks. The hiring manager then offers
attracting qualified applicants. the successful applicant a job, subject to successful completion of a
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medical examination. Notice that an applicant may be rejected or abilities, and motivation of potential employees, allowing managers to
opt out at any time during the selection process. choose candidates according to how they will fit into the open positions
and corporate culture.
Advantages and Disadvantages of Selection Tests

Advantages
 Research indicates that customized tests can be a reliable
and accurate means to predict on-the job performance.
 Organizations use tests to identify attitudes and job-related
skills that interviews cannot recognize.
 Also, the cost of employment testing is small in comparison
to ultimate hiring costs. They are a more efficient way to get
at information that results in better-qualified people being
hired.
Disadvantages
 Employers should be aware that tests might be
unintentionally discriminatory.
 When a test excludes a protected class at a significant rate,
the test should be avoided unless the employer can show
that the test is job related for the position in question and
consistent with business necessity. Test anxiety can also be
a problem. Applicants often become quite anxious when
confronting yet another hurdle that might eliminate them
from consideration.
 Using selection tests carries with it legal liabilities of
two types:
1) One is a lawsuit from rejected applicants who claim a test
was not job related or that it unfairly discriminated against
a protected group, violating federal employment laws.
2) The second potential legal problem relates to negligent
PRELIMINARY SCREENING hiring lawsuits filed by victims of employee misbehavior
Preliminary Screening – In employee selection, a review to eliminate or incompetence
those who obviously do not meet the position’s requirements.
CHARACTERISTICS OF PROPERLY DESIGNED SELECTION
REVIEW OF APPLICATIONS AND REVIEW OF RÉSUMÉS TESTS
Having the candidate complete an application for employment is Properly designed selection tests are standardized, objective, based
another early step in the selection process. This may either precede on sound norms, reliable, and of utmost importance, valid.
or follow preliminary screening. The employer then evaluates it to see Standardization – Uniformity of the procedures and conditions related
whether there is an apparent match between the individual and the to administering tests.
position. Objectivity – Condition that is achieved when everyone scoring a
 Employment-at-will is a policy that either the employer or given test obtains the same results.
the employee can terminate employment at any time for any Norm – Frame of reference for comparing an applicant’s performance
reason. with that of others.
Résumé – Goal-directed summary of a person’s experience,
education, and training developed for use in the selection process. RELIABILITY
 Historically, a one-page résumé was the standard that applicants Extent to which a selection test provides consistent results.
were told to use.
For example, if a person were to take the same test of personality
 Keyword résumé – Résumé that contains an adequate
several times and received highly similar scores (consistent results),
description of the job seeker’s characteristics and industry
this personality test would be judged to be reliable.
specific experience presented in keyword terms in order to
accommodate the computer search process. VALIDITY
 Keywords – Words or phrases that are used to search Extent to which a test measures what it claims to measure.
databases for résumés that match. If a test cannot indicate ability to perform the job, it has no value. And
if used, it will result in poor hiring decisions and a potential legal liability
SELECTION TESTS for the employer.
Tests are essential components of employee selection. There are
many considerations, including advantages and disadvantages, Test Validation Approaches
property of tests, validation approaches, and test type. The Uniform Guidelines on Employee Selection Procedures
Preliminary Considerations – Recognizing the shortcomings of other established three approaches to validating selection tests: criterion-
selection tools, many firms have added selection tests to their hiring related validity, content validity, and construct validity.
process. These tests rate factors such as aptitude, personality,
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1) Criterion-Related Validity – Test validation method that compares Assessment Center – Selection technique that requires individuals to
the scores on selection tests to some aspect of job performance perform activities similar to those they might encounter in an actual
determined, for example, by performance appraisal. job.
 Typical assessment center tests include having applicants complete
2) Concurrent validity is determined when the firm obtains test in-basket exercises and perform in management games,
scores and the criterion data at essentially the same time. leaderless discussion groups, mock interviews, and other
 For instance, it administers the test to all currently employed simulations.
telemarketers and compares the results with company records that  Research has shown that the in-basket exercise, a typical
contain current information about each employee’s job component of assessment centers, is a good predictor of
performance. If the test is able to identify productive and less management performance. Its validity provides an alternative to
productive workers, one could say that it is valid paper-and-pencil tests.
3) Predictive Validity involves administering a test and later obtaining UNIQUE FORMS OF TESTING
the criterion information. Genetic tests – Tests given to identify predisposition to inherited
 For instance, all applicants take the test but the firm uses other diseases, including cancer, heart disease, neurological disorders, and
selection criteria, not the test results, to make the selection decision. congenital diseases.
a) Content Validity – Test validation method whereby a person Graphoanalysis – Use of handwriting analysis as a selection factor.
performs certain tasks that are actually required by the job or Polygraph Tests – For many years, another means used to verify
completes a paper-and-pencil test that measures relevant job background information was the polygraph, or lie-detector test. One
knowledge. purpose of the polygraph was to confirm or refute the information
b) Construct Validity – Test validation method that determines contained in a candidate’s application.
whether a test measures certain constructs, or traits, that job
analysis finds to be important in performing a job. EMPLOYMENT INTERVIEW
A. Employment Interview – Goal-oriented conversation in which an
EMPLOYMENT TESTS interviewer and an applicant exchange information.
Individuals differ in characteristics related to job performance. Broadly,
tests fall into one of two categories: aptitude tests and achievement B. Interview Planning
tests. Interview planning is essential to effective employment interviews. A
primary consideration should be the speed in which the process
1) Aptitude Tests – A test of how well a person can learn or acquire occurs. Many studies have demonstrated that the top candidates for
skills or abilities. nearly any job are hired and off the job market within anywhere from 1
2) Achievement Tests – A test of current knowledge and skills. to 10 days.
3) Cognitive Ability Tests – Tests that determine general reasoning
ability, memory, vocabulary, verbal fluency, and numerical ability. C. Content of the Interview
4) Psychomotor Abilities Tests – Psychomotor abilities refer to the Both the interviewer and the candidate have agendas for the interview.
capacity to connect brain or cognitive functions and functions of the After establishing rapport with the applicant, the interviewer seeks
body such as physical strength. additional job-related information to complement data provided by
 An example of a psychomotor ability is reaction time, which is other selection tools.
defined as “the ability to quickly respond (with the hand, finger, or  Occupational Experience – The interviewer will explore the
foot) to a signal (sound, light, picture) when it appears.” candidate’s knowledge, skills, abilities, and willingness to
5) Personality Tests – Self-reported measures of traits, handle responsibility.
temperaments, or dispositions.  Academic Achievement – In the absence of significant
 Personality – Individual differences in characteristic patterns of work experience, a person’s academic record takes on
thinking, feeling, and behaving. greater importance.
 Generally, fire departments and law enforcement agencies  Interpersonal Skills – An individual may possess important
use the Minnesota Multiphasic Personality Inventory (MMPI) technical skills significant to accomplishing a job.
test, which consists of 567 statements that help to determine a  Personal Qualities – Personal qualities normally observed
subject’s degree of paranoia, depression, mania, or anxiety. during the interview include physical appearance, speaking
 In police departments the MMPI is used to detect the ability, vocabulary, poise, adaptability, assertiveness,
inclination toward substance abuse. These types of tests are leadership ability, and cooperative spirit.
typically used in the early stage of the selection process.
6) Integrity tests represent a specific type of personality attribute. CANDIDATE’S ROLE AND EXPECTATIONS
Integrity refers to “being honest and ethical.”  Although the interviewer will provide information about the
 Employers have used them to measure candidates’ attitudes company, it is still important for candidates to do their
toward theft, dishonesty, absenteeism, violence, drug use, homework, including studying the job description and
alcohol abuse, and other counterproductive behaviors. checking the Internet (including the firm’s Web site) before
7) Job-knowledge Tests – Tests designed to measure a candidate’s the interview.
knowledge of the duties of the job for which he or she is applying.  Employees are also conducting background checks on
8) Work-sample Tests – Tests that require an applicant to perform a companies to check out potential employers on such
task or set of tasks representative of the job. things as financial stability, whether or not the company
would be a good place to work, and career opportunities.
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Recruiters need to remember that interviewees also have objectives POTENTIAL INTERVIEWING PROBLEMS
for the interview. One might be to determine what the firm is willing to Potential interviewing problems that can threaten the success of
pay as a starting salary. employment interviews.
 Inappropriate Questions – Many questions are clearly
Job seekers have other goals that may include the following:
hiring standards to avoid. When they are asked, the
 To be listened to and understood.
responses generated create a legal liability for the employer.
 To have ample opportunity to present their qualifications. The most basic interviewing rule is this: “Ask only job-related
 To be treated fairly and with respect. questions.”
 To gather information about the job and the company.
 To make an informed decision concerning the desirability of  Permitting Non–job-related Information – If a candidate
the job. begins volunteering personal information that is not job
related, the interviewer should steer the conversation back
GENERAL TYPES OF INTERVIEWS on course.
Types of interviews are often broadly classified as structured,  Interviewer Bias – Often a problem that may arise in an
unstructured, behavioral, and situational. interview is interviewer bias where the interviewer makes
assumptions about the interviewee that may be incorrect
Unstructured Interview – Interview in which the job applicant is asked and lets these biases influence the selection decision.
probing, open-ended questions. 1) Stereotyping bias occurs when the interviewer assumes
Structured Interview – Interview in which the interviewer asks each that the applicant has certain traits because they are
applicant for a particular job the same series of job-related questions. members of a certain class.
Behavioral Interview – Structured interview in which applicants are  The classic case of stereotyping bias is when an
asked to relate actual incidents from their past relevant to the target interviewer assumes that a woman applicant cannot
job. meet a certain physical requirement such as being able
 Behavioral interviewers look for three main things: a description to lift 50 pounds.
of a challenging situation, what the candidate did about it, and 2) A positive halo bias occurs when the interviewer
measurable results. generalizes one positive first impression feature of the
Situational Interview – Gives interviewers better insight into how candidate.
candidates would perform in the work environment by creating  Such might be the case with discovering that you have
hypothetical situations candidates would be likely to encounter on the something in common with the applicant. The opposite
job and asking them how they would handle them. could occur with negative horn bias where the
interviewer’s first negative impression of the candidate
METHODS OF INTERVIEWING generalizes throughout the interview.
Organizations conduct interviews in several ways. The level of the 3) Contrast errors may occur when, for example, an
open position and the appropriate labor market determine the most interviewer meets with several poorly qualified applicants
fitting approach. and then confronts a mediocre candidate.
1) One-on-one Interview – In a typical employment interview, the  By comparison, the last applicant may appear to be
applicant meets one-on-one with an interviewer. better qualified than he or she actually is. The opposite
 As the interview may be a highly emotional occasion for the can also occur. Suppose that a clearly outstanding
applicant, meeting alone with the interviewer is often less candidate is followed by a very good candidate. The
threatening. This method provides a better opportunity for an second candidate may not be considered even if the
effective exchange of information to take place. first candidate turns down the job offer.
2) Group Interview – Meeting in which several job applicants interact 4) Premature judgment bias suggests that interviewers
in the presence of one or more company representatives. often make a judgment about candidates in the first few
3) Board Interview (Panel Interview) – An interview approach in minutes of the interview.
which several of the firm’s representatives interview a candidate at  Apparently, these interviewers believe that they have
the same time. the ability to determine immediately whether a
4) Multiple Interviews – At times, applicants are interviewed by peers, candidate will be successful or not. When this occurs,
subordinates, and potential superiors. a great deal of potentially valuable information is not
 This approach permits the firm to get a more encompassing view of considered.
the candidate. It also gives the candidate a chance to learn more  Even if an interviewer spent a week with an applicant,
about the company from a variety of perspectives. the sample of behavior might be too small to judge the
 The result of this type of interview is a stronger, more cohesive team candidate’s qualifications properly.
that shares the company’s culture and helps ensure organizational  In addition, the candidate’s behavior during an
fit. interview is seldom typical or natural, thereby making a
5) Stress Interview – Form of interview in which the interviewer quick judgment difficult.
intentionally creates anxiety. 5) Interview illusion bias is closely related to premature
6) Realistic Job Preview (RJP) – Method of conveying both positive judgment but not the same.
and negative job information to an applicant in an unbiased manner.  Managers may say something to the effect “Give me
 Employers who give detailed RJPs get two results: fewer just five minutes with an applicant and I can tell if they
employees accept the job offer, and applicants who do accept the will be successful with our company.” Their belief in
offer are less likely to leave the firm. their interview ability was likely exaggerated.
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 Recruiters are often overconfident about their ability to judge assigns a potentially dangerous person to a position in which he or she
others in general. Interviewers have to be careful about placing can inflict harm.
excessive weight on interviews and thinking “I just feel good
about this applicant” when making the hiring decision. SELECTION DECISION
 At this point, the focus is on the manager who must take the
Interviewer Domination – In successful interviews, relevant most critical step of all: the actual hiring decision.
information must flow both ways.  In making this decision, the manager will review results of
 Sometimes, interviewers begin the interview by telling candidates the selection methods used.
what they are looking for, and then are excited to hear candidates
parrot back their own words. MEDICAL EXAMINATION
Lack of Training – Interviewers should be trained to have a job-  At this stage, some companies may also require drug testing
related purpose for asking each question. When the cost of making to determine whether applicants are using chemical
poor selection decisions is considered, the expense of training substances or alcohol.
employees in interviewing skills can be easily justified.  There are a variety of reasons for choosing to test applicants
for drug use. Primarily, the use of illegal drugs, which impairs
Nonverbal Communication – Body language is the nonverbal
judgment and psychomotor coordination, may create
communication method in which physical actions such as motions,
workplace hazards.
gestures, and facial expressions convey thoughts and emotions.
NOTIFICATION OF CANDIDATES
CONCLUDING THE INTERVIEW
When the interviewer has obtained the necessary information and  Management should notify both successful and
answered the applicant’s questions, he or she should conclude the unsuccessful candidates of selection decisions as soon as
interview. Management must then determine whether the candidate is possible.
suitable for the open position and organization.  This action is a matter of courtesy and good public relations.
Any delay may also result in the firm losing a prime
PRE-EMPLOYMENT SCREENING AND BACKGROUND CHECKS candidate because top prospects often have other
Background investigation is more important than ever because of the employment options.
rise in negligent hiring lawsuits, recent corporate scandals, and
national security concerns. METRICS FOR EVALUATING THE EFFECTIVENESS OF
 At this stage of the selection process, an applicant has normally RECRUITMENT/SELECTION
completed an application form or submitted a résumé, taken the There is, however, no one-size-fits-all metric that employers can adopt
necessary selection tests, and undergone an employment to achieve greater hiring efficiency. The metrics that best suit each
interview. company depends on a variety of factors, including its business goals.
 On the surface the candidate looks qualified. It is now time to a) Quality of Hire – Many recruiters believe that quality of hire is the
determine the accuracy of the information submitted or to most important metric to use in the selection process. Some
determine whether vital information was not submitted. possible measures to determine the quality of hire might be
communication effectiveness, ability to motivate others, leadership
CONTINUOUS BACKGROUND INVESTIGATION ability, and cultural fit.
Background investigations are not just for pre-employment any more. b) Time Required to Hire – The shorter the time to hire, the more
 Some employers are screening their employees on an ongoing efficient the HR department is in finding the replacement for the job.
basis. In certain industries, such as banking and health care, The top candidates for nearly any job are hired and off the job
employers are required by regulation to routinely research the market within anywhere from 1 to 10 days.
criminal records of employees. c) New-Hire Retention – New-hire retention is calculated by
determining the percentage of the new hires that remain with the
BACKGROUND INVESTIGATION WITH SOCIAL NETWORKING company at selected intervals, typically one or two years.
An increasing number of employers are using social networking to d) Hiring Manager Overall Satisfaction
conduct background investigations. Employers use an applicant’s The manager is largely responsible for the success of his or her
Facebook page, LinkedIn profile, and postings made on an industry department. It is the quality of the employees in the workgroup that
blog to find out about individuals they are considering hiring. have a major impact on success of the department.
e) Turnover Rate – Turnover rate is the number of times on average
REMEMBERING HIRING STANDARDS TO AVOID that employees have to be replaced during a year.
Some of the standards used in the background investigation have the  For example, if a company has 200 employees and 200 workers
potential to violate a hiring standard to avoid. A word of caution is had been hired during the year, a 100 percent turnover rate would
advised in situations when an applicant acknowledges that he or be experienced.
she has been convicted of a crime. f) False Starts – Employees who are hired and then quit within 120
days.
Reference Checks – Validations from individuals who know the
g) Cost Per Hire
applicant that provide additional insight into the information furnished
by the applicant and verification of its accuracy.  In determining the recruiting cost per hire, the total recruiting
expense must first be calculated.
Negligent Hiring – Liability a company incurs when it fails to conduct  Then, the cost per hire may be determined by dividing the
a reasonable investigation of an applicant’s background, and then recruiting expenses (calculation of advertising, agency fees,
14
employee referrals, relocation, recruiter pay, and benefits costs) by the g) Organizational Fit – Management’s perception of the degree to
number of recruits hired. which the prospective employee will fit in with the firm’s culture or
h) Selection Rate – The number of applicants hired from a group of value system.
candidates expressed as a percentage is the selection rate. h) Selection Technology – Two tools that are invaluable to the
 For example, if 100 qualified candidates are available and 25 are selection process in the technology boom that is sweeping HR today
chosen, the selection rate would be 25 percent. are applicant-tracking systems (ATSs) and candidate
i) Acceptance Rate – The acceptance rate is the number of relationship management (CRM).
applicants who accepted the job divided by the number who were
offered the job. SELECTION IN A GLOBAL ENVIRONMENT
 If this rate is unusually low, it would be wise to determine the reason When determining which leadership style will be more appropriate for
that jobs are being turned down. A low acceptance rate increases a company, a country’s culture plays a major role in determining
recruiting cost. whether an executive will be successful or not.
j) Yield Rate – A yield rate is the percentage of applicants from a
particular source and method that make it to the next stage of the LESSON 7: PERFORMANCE MANAGEMENT AND APPRAISAL
selection process.
Performance Management (PM) – Goal-oriented process directed
toward ensuring that organizational processes are in place to
ENVIRONMENTAL FACTORS AFFECTING THE SELECTION
maximize the productivity of employees, teams, and ultimately, the
PROCESS
organization.
A standardized selection process followed consistently would greatly
 It is a major player in accomplishing organizational strategy
simplify the selection process. However, circumstances may require
in that it involves measuring and improving the value of the
making exceptions.
workforce.
The following sections describe environmental factors that affect  PM includes incentive goals and the corresponding incentive
the selection process: values so that the relationship can be clearly understood and
a) Other HR Functions communicated. There is a close relationship between
b) Legal Considerations – Legal matters play a significant role in HR incentives and performance.
management because of EEOC legislation, executive orders, and
court decisions. Performance Appraisal (PA) – Formal system of review and
c) Speed of Decision Making – The time available to make the evaluation of individual or team task performance.
selection decision can also have a major effect on the selection A critical point in the definition is the word formal because, in actuality,
process. Conditions also can impact the needed speed of decision managers should be reviewing an individual’s performance on a
making. continuing basis.
d) Organizational Hierarchy – Organizations usually take different
approaches to filling positions at varying levels. USES OF PERFORMANCE APPRAISAL
e) Applicant Pool – Number of qualified applicants recruited for a 1. Human Resource Planning. In assessing a firm’s HR, data must
particular job. be available to identify those who have the potential to be promoted
f) selection ratio – Number of people hired for a particular job or for any area of internal employee relations. Through PA it may be
compared to the number of qualified individuals in the applicant discovered that there is an insufficient number of workers who are
pool. prepared to enter management.
2. Training and Development. Performance appraisal should point
out an employee’s specific needs for training and development.
 By identifying deficiencies that adversely affect performance,
e) Type of Organization training and development (T&D) programs can be developed that
 The type of organization employing individuals, such as permit individuals to build on their strengths and minimize their
private, governmental, or not for profit, can also affect the deficiencies.
selection process. 3. Career Planning and Development
 Most private-sector businesses are heavily profit oriented. Career planning is an ongoing process whereby an individual sets
Prospective employees who can help achieve profit goals career goals and identifies the means to achieve them. On the other
are the preferred candidates. hand, career development is a formal approach used by the
 Consideration of the total individual, including job-related organization to ensure that people with the proper qualifications and
personality factors, is involved in the selection of employees experiences are available when needed.
for this sector. 4. Compensation Programs
f) Probationary Period “the behaviors you reward are the behaviors you get.”
 Many firms use a probationary or introductory period that Rewarding behaviors necessary for accomplishing organizational
permits them to evaluate an employee’s ability based on objectives is at the heart of a PM system. To encourage good
established performance. performance, a firm should design and implement a reliable PA system
 The purpose of a probationary period is to establish the and then reward the most productive workers and teams accordingly.
suitability of a new employee for the position and to resolve 5. Internal Employee Relations. PA data are also used for decisions
any issues there might be in the new employee’s in several areas of internal employee relations, including promotion,
performance over the first three months or so. demotion, termination, layoff, and transfer.
15
6. Assessment of Employee Potential. Some organizations attempt Competencies, as we discussed in Chapter 4, refer to an individual’s
to assess an employee’s potential as they appraise his or her job capability to orchestrate and apply combinations of knowledge,
performance. Although past behaviors may be a good predictor of skills, and abilities consistently over time to perform work
future behaviors in some jobs, an employee’s past performance successfully in the required work situations.
may not accurately indicate future performance in other jobs.  Competencies may be technical in nature, relate to
interpersonal skills, or are business oriented.
PERFORMANCE APPRAISAL PROCESS  For example, analytical thinking and achievement
orientation might be essential in professional jobs. In
leadership jobs, relevant competencies might include
developing talent, delegating authority, and people
management skills. The competencies selected for
evaluation purposes should be those that are closely
associated with job success.
GOAL ACHIEVEMENT
If organizations consider ends more important than means, goal
achievement outcomes become an appropriate factor to evaluate. The
outcomes established should be within the control of the individual or
team and should be results that lead to the firm’s success.
 This aspect of employee appraisal should be the most positive
element in the entire process and help the employee focus on
behavior that will produce positive results for all concerned.
IMPROVEMENT POTENTIAL
 When organizations evaluate their employees’ performance,
many of the criteria used focus on the past.
 From a PM viewpoint, the problem is that you cannot change
the past. Unless a firm takes further steps, the evaluation
data become merely historical documents. Therefore, firms
should emphasize the future, including the behaviors and
outcomes needed to develop the employee, and in the
ESTABLISH PERFORMANCE CRITERIA (STANDARDS) process, achieve the firm’s goals.
Management must carefully select performance criteria as it pertains  This involves an assessment of the employee’s potential.
to achieving corporate goals. The most common appraisal criteria are Including potential in the evaluation process helps to
traits, behaviors, competencies, goal achievement, and improvement ensure more effective career planning and development.
potential.
RESPONSIBILITY FOR PERFORMANCE APPRAISAL
TRAITS, BEHAVIORS, AND COMPETENCIES – Traits, behaviors, Often the human resource department is responsible for coordinating
and competencies are often used as PA standards. the design and implementation of PA programs. However, it is
essential that line managers play a key role from beginning to end.
Traits represent an individual’s predisposition to think, feel, and These individuals usually conduct the appraisals, and they must
behave, and many traits are usually thought of as being biologically directly participate in developing the program if it is to succeed.
created. A personality trait is more ingrained with an individual as with
a person being introverted or extroverted, or less conscientious or IMMEDIATE SUPERVISOR
more conscientious. An employee’s immediate supervisor has traditionally been the most
Behaviors are typically viewed as resulting from a variety of logical choice for evaluating performance, and this continues to be the
sources including traits and situational context. case. The supervisor is usually in an excellent position to observe the
For example, a highly conscientious person is more likely to engage in employee’s job performance, and the supervisor has the responsibility
behaviors that lead to timely task completion than someone who is for managing a particular unit.
less conscientious because conscientiousness is associated with
dutifulness. SUBORDINATES
 An appropriate behavior to evaluate for a manager might be Some firms conclude that evaluation of managers by subordinates is
leadership style. For individuals working in teams, both feasible and needed. They reason that subordinates are in an
developing others, teamwork and cooperation, or customer excellent position to view their superiors’ managerial effectiveness.
service orientation might be appropriate.  Advocates believe that this approach leads supervisors to become
 Desired behaviors may be appropriate as evaluation criteria especially conscious of the work group’s needs and to do a better
because if they are recognized and rewarded, employees job of managing.
tend to repeat them. If certain behaviors result in desired
outcomes, there is merit in using them in the evaluation PEERS AND TEAM MEMBERS – A major strength of using peers to
process. appraise performance is that they work closely with the evaluated
employee and probably have an undistorted perspective on typical
performance, especially in team assignments.
16
SELF-APPRAISAL Employees are ranked from the best performer to the poorest
If employees understand their objectives and the criteria used for performer.
evaluation, they are in a good position to appraise their own
performance. Many people know what they do well on the job and FORCED DISTRIBUTION METHOD
what they need to improve. If they have the opportunity, they will Performance appraisal method in which the rater is required to
criticize their own performance objectively and take action to improve assign individuals in a work group to a limited number of categories,
it. similar to a normal frequency distribution.
 An alternative approach, called a forced distribution method PA
CUSTOMER APPRAISAL and sometimes referred to as a stacked ranking system, assigns
 Customer behavior determines a firm’s degree of success. employees to groups that represent the entire range of
Therefore, some organizations believe it is important to performance. For example, three categories that might be used are
obtain performance input from this critical source. best performers, moderate performers, and poor performers.
 Organizations use this approach because it demonstrates a
Forced distribution approaches have drawbacks. The forced
commitment to the customer, holds employees accountable,
distribution approach can distort ratings because employee
and fosters change.
performance may not fall into these predetermined distributions.
 Customer-related goals for executives generally are of a
broad, strategic nature, whereas targets for lower-level Let’s assume that a supervisor must use the following forced
employees tend to be more specific. distribution to rate her employees’ performance:
 15 percent well below average
360-DEGREE FEEDBACK  25 percent below average
People all around the employee whose performance is being judged  40 percent average
may provide input. Those sources, as we have already discussed,  15 percent above average
include senior managers, the employee himself or herself, a  5 percent well above average
supervisor, subordinates, peers, team members, and internal or
external customers. By shifting the responsibility for evaluation to This distribution is problematic to the extent that the actual distribution
more than one person, many of the common appraisal errors can be of employee performance is substantially different from this forced
reduced or eliminated. distribution. If 35 percent of the employees’ performance were either
above average or well above average, then the supervisor would be
360-degree feedback evaluation method – Popular performance required to underrate the performance of 15 percent of the employees.
appraisal method that involves evaluation input from multiple levels Based on this forced distribution, the supervisor can rate only 20
within the firm as well as external sources. percent of the employees as having demonstrated above-average or
well-above- average job performance.
PERFORMANCE APPRAISAL PERIOD
Formal performance evaluations are usually prepared at specific Paired Comparisons. Supervisors compare each employee to every
intervals. Although there is nothing magical about the period for other employee, identifying the better performer in each pair.
formal appraisal reviews, in most organizations they occur either
annually or semiannually. BEHAVIORAL SYSTEMS
 Even more significant, however, is the continuous interaction  Performance appraisal methods that focus on
(primarily informal), including coaching and other developmental distinguishing between successful and unsuccessful
activities, that continues throughout the appraisal period. behaviors.
 Behavioral systems rate employees on the extent to which
CHOOSING A PERFORMANCE APPRAISAL METHOD they display successful job performance behaviors. In
The various methods are next presented as if they are separate and contrast to trait and comparison methods, behavioral
distinct when in actuality each may be used in conjunction with another methods rate objective job behaviors. When correctly
method. For instance, the 360-degree feedback method may developed and applied, behavioral models provide results
incorporate portions of the ranking scale. There are multiple that are relatively free of rater errors and biases.
approaches to appraising employee performance. It is instructive to The three main types of behavioral systems are the critical
group them into categories according to what they are designed to incident technique (CIT), behaviorally anchored rating scales
measure. (BARS), and behavioral observation scales (BOS).
PA methods fall into four broad categories:
 Trait systems Critical Incident Technique (CIT)
 Comparison systems  Performance appraisal method that requires keeping
 Behavioral systems written records of highly favorable and unfavorable
employee work actions.
 Results-based systems
 The critical incident technique (CIT) requires job incumbents
TRAIT SYSTEMS – Type of performance-appraisal method, requiring and their supervisors to identify performance incidents (e.g.,
raters (e.g., supervisors or customers) to evaluate each employee’s on-the-job behaviors and behavioral outcomes) that
traits or characteristics (e.g., quality of work and leadership). distinguish successful performances from unsuccessful
ones. The supervisor then observes the employees and
COMPARISON SYSTEMS – A type of performance-appraisal method, records their performance on these critical job aspects.
require that raters (e.g., supervisors) evaluate a given employee’s Behaviorally Anchored Rating Scale (BARS)
performance against other employees’ performance attainments.  Performance appraisal method that combines elements of
the traditional rating scale and critical incident
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methods; various performance levels are shown along a problems commonly mentioned are not exclusive to this method but
scale with each described in terms of an employee’s specific rather, reflect improper implementation.
job behavior.
The following section highlights some of the more common
 Behaviorally anchored rating scales (BARS) are based on
problem areas.
the CIT, and these scales are developed in the same fashion
with one exception. For the CIT, a critical incident would be
APPRAISER DISCOMFORT
written as “the incumbent completed the task in a timely
 Conducting PAs is often a frustrating task for managers. If a
fashion.”
PA system has a faulty design, or improper administration,
 A typical job might have 8–10 dimensions under BARS, employees will dread receiving appraisals and the managers
each with a separate rating scale.
will despise giving them.
 In fact, some managers have always loathed the time,
Behavioral Observation Scale (BOS)
paperwork, difficult choices, and discomfort that often
 A specific kind of behavioral system for evaluating job
accompanies the appraisal process.
performance by illustrating positive incidents (or
 Going through the procedure cuts into a manager’s high-
behaviors) of job performance for various job dimensions.
priority workload and the experience can be especially
 BOS is developed in the same way as a BARS instrument,
unpleasant when the employee in question has not
except that it incorporates only positive performance
performed well.
behaviors. The BOS method tends to be difficult and time-
consuming to develop and maintain.
SUBJECTIVITY OF PERFORMANCE EVALUATIONS
A potential weakness of many PA methods is that they lack objectivity.
RESULTS-BASED PERFORMANCE APPRAISAL
For example, commonly used factors such as traits, behaviors, and
 Performance appraisal method in which the manager and competencies are virtually impossible to measure with objective
subordinate jointly agree on objectives for the next measures.
appraisal period; in the past a form of management by
objectives. Rating Errors
 Results-based performance appraisal methods focus on In performance appraisals, differences between human judgment
measurable outcomes such as an individual’s or team’s processes versus objective, accurate assessments uncolored by bias,
sales, customer service ratings, productivity, reduced prejudice, or other subjective, extraneous influences.
incidence of workplace injuries, and so forth. The selection Major types of rater errors include:
of results largely depends on three factors.  Bias Errors. Evaluation errors that occur when the rater
 The first factor is the relevance of the results that may evaluates the employee based on a personal negative or
be used to judge a company’s progress toward meeting positive opinion of the employee rather than on the
its strategic goals. employee’s actual performance.
 The second factor is the reliability with which results can 1. First-impressionIeffect.OAn initial favorable or
be measured. unfavorable judgment about an employee’s which is
 The third factor is the extent to which the results ignored or distorted.
measure is truly a measure of performance over which an 2. Positive halo effect (or halo effect). Evaluation error
employee has the resources and latitude to achieve the that occurs when a manager generalizes one positive
designated results. performance feature or incident to all aspects of
 Various segments of the MBO process can easily be employee performance, resulting in a higher rating.
integrated into an effective goal-oriented system. Goal- 3. Negative halo effect (or horn error). Evaluation error
oriented systems are often a component of broader that occurs when a manager generalizes one negative
development programs that help employees achieve performance feature or incident to all aspects of
career goals. employee performance, resulting in a lower rating.
4. A similar-to-me effect refers to the tendency on the part
Work Standards Method of raters to judge favorably employees whom they
Performance appraisal method that compares each employee’s perceive as similar to themselves. Supervisors biased
performance to a predetermined standard or expected level of by this effect rate more favorably employees who have
output. attitudes, values, backgrounds, or interests similar to
 The work standards method is often coupled with a particular theirs.
incentive pay plan known as the piecework plan. Piecework plans 5. Illegal discriminatory bias. A bias error for which a
typically found in manufacturing settings, rewards employees based supervisor rates members of his or her race, gender,
on their individual hourly production against an objective output nationality, or religion more favorably than members
standard and is determined by the pace at which manufacturing of other classes.
equipment operates. For each hour, workers receive piecework  Contrast Errors. A rating error in which a rater (e.g., a
incentives for every item produced over the designated production supervisor) compares an employee to other employees
standard. rather than to specific explicit performance standards.
 Errors of central tendency/Central Tendency Error.
PROBLEMS IN PERFORMANCE APPRAISAL Evaluation appraisal error that occurs when employees
PA is constantly under a barrage of criticism. The rating scales method are incorrectly rated near the average or middle of a
seems to be the most vulnerable target. Yet in all fairness, many of the
scale.
18
 Errors of leniency or strictness/Leniency Error. Giving consider inaccurate or unfair. They must have a procedure for
an undeserved high performance appraisal rating to an pursuing their grievances and having them addressed objectively.
employee. Strictness Errors – Being unduly critical of an
employee’s work performance. LEGAL CONSIDERATIONS IN PERFORMANCE APPRAISAL
Employee lawsuits may result from negative evaluations. Employees
Employee Anxiety often win these cases, thanks in part to the firm’s own PA procedures.
The evaluation process may also create anxiety for the appraised A review of court cases makes it clear that legally defensible PA
employee. This may take the form of discontent, apathy, and turnover. systems should be in place.
In a worst-case scenario, a lawsuit is filed based on real or perceived
unfairness. PERFORMANCE APPRAISAL INTERVIEW
The appraisal interview is the Achilles’ heel of the entire evaluation
CHARACTERISTICS OF AN EFFECTIVE APPRAISAL SYSTEM process. In fact, appraisal review sessions often create hostility and
The basic purpose of a PA system is to improve the performance of can do more harm than good to the employee– manager relationship.
individuals, teams, and the entire organization. The system may also To minimize the possibility of hard feelings, the face-to-face meeting
serve to assist in making administrative decisions concerning pay and the written review must have performance improvement, not
increases, promotions, transfers, or terminations. criticism, as their goal.
JOB-RELATED CRITERIA – Job-relatedness is perhaps the most SCHEDULING THE INTERVIEW

basic criterion needed in employee performance appraisals. The Supervisors usually conduct a formal appraisal interview at the end of
evaluation instrument should tie in closely to the accomplishment of an employee’s appraisal period. It should be made clear to the
organizational goals. employee as to what the meeting is about.
PERFORMANCE EXPECTATIONS INTERVIEW STRUCTURE

 Employees must understand in advance what is expected of A successful appraisal interview should be structured in a way that
them. How can employees function effectively if they do not allows both the supervisor and the subordinate to view it as a problem-
know what they are being measured against? solving rather than a fault-finding session. The manager has several
 On the other hand, if employees clearly understand the purposes when planning an appraisal interview.
expectations, they can evaluate their own performance and Although costs are a consideration, there is merit in conducting
make timely adjustments as they perform their jobs, without separate interviews for discussing (1) employee performance and
having to wait for the formal evaluation review. development and (2) pay. Many managers have learned that as soon
as the topic of pay emerges in an interview, it tends to dominate the
STANDARDIZATION – Firms should use the same evaluation conversation, with performance improvement taking a back seat.
instrument for all employees in the same job category who work for the
same supervisor. USE OF PRAISE AND CRITICISM
 Praise is appropriate when warranted, but it can have limited
TRAINED APPRAISERS value if not clearly deserved. If an employee must eventually
The training should be an ongoing process to ensure accuracy and be terminated because of poor performance, a manager’s
consistency. It should cover how to rate employees and how to false praise could bring into question the “real” reason for
conduct appraisal interviews. Instructions should be rather detailed being fired.
and the importance of making objective and unbiased ratings should
 Criticism, even if warranted, is especially difficult to give.
be emphasized.
The employee may not perceive it as being constructive. It
is important that discussions of these sensitive issues focus
CONTINUOUS OPEN COMMUNICATION
on the deficiency, not the person.
 Most employees have a strong need to know how well they
are performing. A good appraisal system provides highly EMPLOYEES’ ROLE
desired feedback on a continuing basis.
 From the employees’ side, two weeks or so before the
 When something new surfaces during the appraisal review, they should go through their diaries or files and make
interview, the manager probably did not do a good enough a note of all projects worked on, regardless of whether or not
job communicating with the employee throughout the they were successful.
appraisal period.
 The best recourse for employees in preparing for an
appraisal review is to prepare a list of creative ways they
CONDUCT PERFORMANCE REVIEWS
have solved problems with limited resources. They will look
In addition to the need for continuous communication between
especially good if they can show how their work contributes
managers and their employees, a special time should be set for a
to the value of the company.
formal discussion of an employee’s performance. Performance review
allows them to detect any errors or omissions in the appraisal, or an
CONCLUDING THE INTERVIEW
employee may disagree with the evaluation and want to challenge it.
Ideally, employees will leave the interview with positive feelings about
management, the company, the job, and themselves. If the meeting
DUE PROCESS – Ensuring due process is vital. If the company does
results in a deflated ego, the prospects for improved performance will
not have a formal grievance procedure, it should develop one to
be bleak. Although you cannot change past behavior, future
provide employees an opportunity to appeal appraisal results that they
performance is another matter. The interview should end with specific
and mutually agreed-on plans for the employee’s development.
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NATIONAL CULTURE AND PERFORMANCE APPRAISAL expected, and the law does not preclude supervisory discretion in the
PA is an area of human resource management that has special process. However, systems that possess certain characteristics are
problems when translated into different countries’ cultural more legally defensible.
environments. 10. Explain how the appraisal interview should be conducted and
discuss how performance appraisal is affected by a country’s
Culture also plays a significant role in the success and failure of PA
culture. A successful appraisal interview should be structured in a way
systems in the Middle East. In the Middle East there is a view called
that allows both the supervisor and the subordinate to view it as a
wasta, which significantly affects how business is conducted. Wasta
problem-solving rather than a fault-finding session. PA is an area of
refers to using mutual favors instead of merit to get things done.
human resource management that has special problems when
Because wasta implies reciprocity, it remains entrenched in society,
translated into different countries’ cultural environments. The use of
and it has a major effect on HR, especially PA.
PA in the United States is relatively new compared to many older
countries. Here, formal performance appraisal came into systematic
SUMMARY
use toward the beginning of the 20th century. However, PA in other
1. Describe performance management.
countries has evolved over many centuries and is strongly affected by
Performance management (PM) is a goal-oriented process that is
a country’s culture.
directed toward ensuring that organizational processes are in place to
maximize productivity of employees, teams, and ultimately, the LESSON 8: TRAINING AND DEVELOPMENT
organization. PM systems are one of the major focuses in business
today. With PM, the effort of each and every worker should be directed Training and Development (T&D). Heart of a continuous effort
toward achieving strategic goals. designed to improve employee competency and organizational
2. Define performance appraisal and identify the uses of performance.
performance appraisal. Training. Activities designed to provide learners with the knowledge
Performance appraisal (PA) is a system of review and evaluation of and skills needed for their present jobs.
individual or team task performance. PA data are potentially valuable
for use in numerous human resource functional areas, including Development. Learning that goes beyond today’s job and has a more
human resource planning, recruitment and selection, training and long-term focus.
development, career planning and development, compensation Organization Development (OD). Planned and systematic attempts
programs, internal employee relations, and assessment of employee to change the organization, typically to a more behavioral environment.
potential.
Figure 8-1: Organization of training and development elements
3. Discuss the performance appraisal process. The identification of
specific goals is the starting point for the PA process and the beginning
of a continuous cycle. Then job expectations are established with the
help of job analysis. The next step involves examining the actual work
performed. Performance is then appraised. The final step involves
discussing the appraisal with the employee.
4. Identify the various performance criteria (standards) that can
Learning Organization. Firm that recognizes the critical importance
be established. The most common appraisal criteria are traits,
of continuous performance-related T&D and takes appropriate action.
behaviors, competencies, goal achievement, and improvement
potential.
TRAINING AND DEVELOPMENT PROCESS
5. Identify who may be responsible for performance appraisal and
The general T&D process that anticipates or responds to change may
explain the performance period. People who are usually responsible
be seen in Figure 8-2. First, an organization must determine its specific
for PA include immediate supervisors, subordinates, peers and team
needs for training. As we will see, needs are considered at the levels
members, self-appraisal, and customer appraisal. Formal
of the organization, task, and persons.
performance evaluations are usually prepared at specific intervals.
Figure 8-2: Training and Development Process
Although there is nothing magical about the period for formal appraisal
reviews, in most organizations they occur either annually or
semiannually.
6. Identify the various performance appraisal methods. PA
methods include 360-degree feedback evaluation, rating scales,
critical incidents, work standards, ranking, forced distribution,
behaviorally anchored rating scales, and results-based approaches.
7. List the problems that have been associated with performance
appraisal. The problems associated with Pas include appraiser
discomfort, lack of objectivity, halo/ horn errors, leniency/strictness,
central tendency, recent behavior bias, personal bias (stereotyping),
and employee anxiety.
8. Explain the characteristics of an effective appraisal system.
Characteristics include job-related criteria, performance expectations,
standardization, trained appraisers, continuous open communication,
conduct performance reviews, and due process.
9. Describe the legal considerations associated with performance
appraisal. A review of court cases makes it clear that legally
defensible PA systems should be in place. Perfect systems are not
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Determine specific training and Development Needs ESTABLISH TRAINING AND DEVELOPMENT PROGRAM
The first step in the T&D process is to determine specific T&D needs. OBJECTIVES
In today’s highly competitive business environment, undertaking a T&D must have clear and concise objectives and be developed to
program because other firms are doing it is asking for trouble. A achieve organizational goals. Without them, designing meaningful
systematic approach to addressing bona fide needs must be T&D programs would not be possible. Worthwhile evaluation of a
undertaken and must be done taking into consideration the mission of program’s effectiveness would also be difficult, at best.
the organization.
Training and Development Needs Assessment. Heart of a
continuous effort designed to improve employee competency and
organizational .performance.
ORGANIZATIONAL ANALYSIS
Organizational analysis focuses on the firm’s strategic mission, goals
and corporate plans are studied, along with the results of strategic
human resource planning
Organizational Analysis – Training needs assessment activity,
which focuses on the firm’s strategic mission, goals, and corporate
plans are studied, along with the results of strategic HR planning.
TASK ANALYSIS – A training needs assessment activity, which

As you see, the purpose is established first. The specific learning
focuses on the tasks required to achieve the firm’s purposes.
objectives that follow leave little doubt about what the training should
accomplish. With these objectives, managers can determine whether
The following are some of the Customer Service Representative job
training has been effective. For instance, in the example, a trainee
tasks that are specified in the Occupational Information Network
either can or cannot state how to get help on equal employment
(O*NET).
opportunity matters.
 Confer with customers by telephone or in person to provide
information about products or services, take or enter
TRAINING METHODS
orders, cancel accounts, or obtain details of complaints.
Regardless of whether programs are in-house or outsourced, firms use
 Check to ensure that appropriate changes were made to a number of methods for imparting knowledge and skills to the
resolve customers’ problems. workforce and usually more than one method, called blended
 Keep records of customer interactions or transactions, training, is used to deliver T&D. As part of the blended training
recording details of inquiries, complaints, or comments, as process, mobile learning is enhancing or replacing some traditional
well as actions taken. training methods.
 Resolve customers’ service or billing complaints by
performing activities such as exchanging merchandise, CLASSROOM METHOD – The classroom method, in which the
refunding money, or adjusting bills. instructor physically stands in front of students, continues to be
 Refer unresolved customer grievances to designated effective for many types of training. One advantage of instructor-led
departments for further investigation. training is that the instructor may convey a great deal of information in
 Order tests that could determine the causes of product a relatively short time.
malfunctions.
E-LEARNING – The T&D method for online instruction using
PERSON ANALYSIS – A training needs assessment activity that technology based methods such as the DVDs, company intranets, and
focuses on finding answers to questions such as Who needs to be the Internet. A takeoff on e-learning is the live virtual classroom,
trained? What do they need to do differently from what they’re often referred to as virtual instructor led, that uses a Web-based
doing today? What kind of knowledge, skills, and abilities (KSAs) platform to deliver live, instructor-led training to geographically
do employees need? dispersed learners.
CASE STUDY – T&D method in which trainees are expected to study
Among many, O*NET lists the following most important KSAs, the information provided in the case and make decisions based on it.
respectively, to the customer service representative job:
Customer and Personal Service—Knowledge of principles and BEHAVIOR MODELING AND TWEETING
processes for providing customer and personal services. This includes  Behavior Modeling – T&D method that permits a person to
customer needs assessment, meeting quality standards for services, learn by copying or replicating behaviors of others to
and evaluation of customer satisfaction. show managers how to handle various situations.
Active Listening—Giving full attention to what other people are  Social networking, such as Twitter, has been used as a
saying, taking time to understand the points being made, asking learning tool involving behavior modeling. “In a
questions as appropriate, and not interrupting at inappropriate times. corporation, micro-blogging can be a way to augment
Oral Comprehension—The ability to listen to and understand behavior modeling,” says Sarah Millstein, author of the
information and ideas presented through spoken words and O’Reilly Radar Report. This works by having a person who
sentences. excels at a task send out frequent updates about what he or
she is doing.
21
ROLE-PLAYING – T&D method in which participants are required to There are basically three categories of online higher education
respond to specific problems they may encounter in their jobs by programs available: hybrid, synchronous, and asynchronous.
acting out real-world situations. 1. Hybrid programs permit students to take some classes online and
some in a traditional university setting.
TRAINING GAMES
2. Online synchronized study offers students the choice of studying
Games can be quite useful learning tools to aid in the group dynamic
through an online portal system; however, the student is expected
process. Games are a cost-effective means to encourage learner
to appear for most classes on a real-time schedule. With this
involvement and stimulate interest in the topic, thereby enhancing
approach, students interact with a real professor and obtain real-
employees’ knowledge and performance.
time support for the learning material.
 Business Games – T&D method that permits participants to
3. With asynchronous learning, students have a series of
assume roles such as president, controller, or marketing vice-
assignments that need to be completed in a certain time frame. A
president of two or more similar hypothetical organizations and
system is available that allows students to communicate with the
compete against each other by manipulating selected factors in a
professor and classmates.
particular business situation.
IN-BASKET TRAINING – T&D method in which the participant is VESTIBULE SYSTEM – T&D delivery system that takes place away
asked to establish priorities for and then handle a number of from the production area on equipment that closely resembles
business papers, e-mail messages, memoranda, reports, and equipment actually used on the job.
telephone messages that would typically cross a manager’s desk.
VIDEO MEDIA
ON-THE-JOB TRAINING (OJT) These media are especially appealing to small businesses that cannot
An informal T&D method that permits an employee to learn job tasks afford more expensive training methods and are often incorporated in
by actually performing them. e-learning and instructor-led instruction. In addition, they provide the
 The key to this training is to transfer knowledge from a highly flexibility desired by any firm. Behavior modeling, previously
skilled and experienced worker to a new employee, while mentioned, has long been a successful training method that uses
maintaining the productivity of both workers. video media.
 OJT is used to pass on critical “how to” information to the SIMULATORS – T&D delivery system comprised of devices or
trainee. Individuals may also be more highly motivated to programs that replicate actual job demands.
learn because it is clear to them that they are acquiring the
knowledge needed to perform the job. SOCIAL NETWORKING
Today’s employees interact, learn, and work in much different ways
APPRENTICESHIP TRAINING – Training method that combines and styles than in the not-so-distant past. Increasingly mobile and
classroom instruction with on-the-job training. geographically dispersed workforces are becoming the norm. At the
TEAM TRAINING – Training focused on teaching knowledge and skills same time, dwindling or stagnant travel budgets are creating a need
to individuals who are expected to work collectively toward meeting a for different training methods. As a result, some organizations are
common objective. using social networking and collaborative tools to enable informal
 Team Coordination Training. Team training focused on learning.
educating team members how to orchestrate the individual  The premise behind the educational success of social networking is
work that they do to complete The Task. the learning approach referred to as constructivism. A
 Cross-training. Type of training for educating team constructivist learning environment differs from the traditional
members about the other members’ jobs so that they may model. In this setting, the teacher guides the learner toward
perform them when a team member is absent, is assigned multiple learning sources, rather than acting as the sole source
to another job in the company, or has left the company of knowledge.
altogether.
IMPLEMENTING TRAINING AND DEVELOPMENT PROGRAMS
TRAINING AND DEVELOPMENT DELIVERY SYSTEMS A perfectly conceived training program will fail if management cannot
The previous section focused on the various T&D methods available convince the participants of its merits. Participants must believe that
to organizations, and the list is constantly changing. In this section, our the program has value and will help them achieve their personal and
attention is devoted to how training may be delivered to participants. professional goals. A long string of successful programs certainly
enhances the credibility of T&D.
CORPORATE UNIVERSITY
T&D delivery system provided under the umbrella of the METRICS FOR EVALUATING TRAINING AND DEVELOPMENT
organization. Managers should strive to develop and use T&D metrics because such
 The corporate T&D institution’s focus is on creating information can smooth the way to budget approval and executive buy-
organizational change that involves areas such as company in. Most managers agree that training does not cost, it pays, and that
training, employee development, and adult learning. training is an investment, not an expense. However, the actual value
 It aims to achieve its goals by conducting activities that foster of the training must be determined if top management will be ready to
individual and organizational learning and knowledge. invest in it.
COLLEGES AND UNIVERSITIES The traditional framework for evaluation of training is based on
four criteria. Although this framework was developed decades ago,
ONLINE HIGHER EDUCATION HR professionals often rely on it to organize evaluation efforts.
Educational opportunities including degree and training programs that
are delivered, either entirely or partially, via the Internet.
22
REACTIONS  Other Human Resource Functions. Successful
 Training evaluation criterion focused on the extent to which accomplishment of other human resource functions can also
trainees liked the training program related to its usefulness, have a crucial impact on T&D.
and quality of conduct.  For instance, if recruitment-and-selection efforts or its
 The survey questions can be specific or general (“how compensation package attract only marginally qualified
satisfied were you with the presentation of sales skill workers, a firm will need extensive T&D programs. Hiring
strategies?” versus “how satisfied were you with the marginally qualified workers will likely have a significant
overall training program?”). impact on the firm’s safety and health programs.
Therefore, additional training will be required.
LEARNING
 The extent to which an employee understands and retains
HUMAN RESOURCE MANAGEMENT TRAINING INITIATIVES
principles, facts, and techniques.
HR is responsible for many company-wide training initiatives on HR-
 As with trainee reactions, learning is often assessed on related matters. Among these initiatives are orientation (onboarding),
completion of the training program (and sometimes, ethics, compliance (equal employment opportunity, Occupational
throughout the training course) by the appropriate tests Safety and Health), and diversity.
(typing speed or recall of concepts from memory).
 The pretest–posttest control group design is one evaluation ORIENTATION – Initial T&D effort for new employees that informs
procedure that may be used. them about the company, the job, and the work group.
BEHAVIOR – The third criterion is behavior change. Orientation formats are unique to each firm. However, some basic
 Behavior Change. Change in job-related behaviors or purposes are listed here.
performance that can be attributed to training.  The Employment Situation. At an early point in time, it is
 Transfer of Training. Training evaluation method helpful for the new employee to know how his or her job
focusing on the extent to which an employee generalizes fits into the firm’s organizational structure and goals.
knowledge and skill learned in training to the work  Company Policies and Rules. Every job within an
place, as well as maintains the level of skill proficiency or organization must be performed within the guidelines and
knowledge learned in training. constraints provided by policies and rules. Employees
must understand these to ensure a smooth transition into the
ORGANIZATIONAL RESULTS – Typically, training outcomes such as workplace.
enhanced productivity, lower costs, and higher product or service  Compensation. Employees have a special interest in
quality. obtaining information about the reward system.
 Benchmarking. Process of monitoring and measuring a firm’s Management normally provides this information during the
internal processes, such as operations, and then comparing the recruitment-and-selection process and often reviews it
data with information from companies that excel in those areas. during orientation.
 Corporate Culture. The firm’s culture reflects, in effect,
FACTORS INFLUENCING TRAINING AND DEVELOPMENT “How we do things around here.” This relates to
There are numerous factors that both impact and are impacted by everything from the way employees dress to the way they
T&D. talk.
 Shortage of Skilled Workers. Shortage of future skilled  Team Membership. A new employee’s ability and
workers was first projected in the 1980s but has recently willingness to work in teams was likely determined before
received additional attention. he or she was hired. In orientation, the program may again
 Technological Advances. Perhaps no factor has emphasize the importance of becoming a valued member of
influenced T&D more than technology. As technology the company team.
becomes capable of handling more and more tasks,  Employee Development. An individual’s employment
employers combine jobs and confer broader responsibilities security is increasingly becoming dependent on his or her
on remaining workers. ability to acquire needed knowledge and skills that are
 Global Complexity. The world is simply getting more constantly changing. Thus, firms should keep employees
complex, and this has had an impact on how an organization aware not only of company-sponsored developmental
operates. Now more than ever, to sustain competitive programs, but also of those available externally.
advantage companies must provide their employees with  Socialization. To reduce the anxiety that new employees
leading-edge skills, and encourage employees to apply their may experience, the firm should take steps to integrate
skills proficiently. them into the informal organization. Some organizations
 Learning Styles. Learning style supports the concept that have found that employees subjected to socialization
people have a natural preference, based on their dominant programs, including the topics of politics and career
sense, in how they choose to learn and process information. management, perform better than those who have not
It may be visual, hearing, or touching. undergone such training.
 Blended Training. The use of multiple training methods  To this list, add the fact that there are numerous forms and
to deliver T&D. documents a new employee must complete or read and
 Just-In-Time Training (on-demand training). Training acknowledge.
provided anytime, anywhere in the world when it is
needed. CAREERS AND CAREER PATHS
 Career. General course that a person chooses to pursue
throughout his or her working life.
23
 Career Path. A flexible line of movement through which a effect of a decision on personal feelings as well as on others
person may travel during his or her work life. (Feeling) stand in contrast to a preference to make objective
decisions (Thinking). Lifestyle refers to an individual’s inclination to
TRADITIONAL CAREER PATH – Employee progresses vertically
be either flexible or structured. A preference to establish goals,
upward in the organization from one specific job to the next.
strategies for goal attainment, and deadlines for meeting them
NETWORK CAREER PATH – Method of career progression that (Judging) stands in contrast to a preference for embracing the
contains both a vertical sequence of jobs and a series of horizontal unexpected, modifying decisions, and working without definitive
opportunities. timelines and deadlines (Perceiving).
LATERAL SKILL PATH – Career path that allows for lateral moves An example of a formal test is the Career Key, which is based on
within the firm, taken to permit an employee to become revitalized and Holland’s Theory of Career Choice. This theory is premised on the
find new challenges. idea that people are more likely to thrive in situations that match their
personalities. It specifies six personality and corresponding situational
DUAL-CAREER PATH – Career path that recognizes that technical
types.
specialists can and should be allowed to contribute their expertise to a
company without having to become managers. For example, according to Holland’s theory:
Persons having an Investigative personality type “dominate” this
ADDING VALUE TO YOUR CAREER
environment. There are more of them than there are people of
Adding value to your career may appear to be totally self-serving, but
other personality types. For example, in a scientific laboratory
nevertheless, it is a logical and realistic career path. In the rapidly
there will be more persons having an “Investigative” personality
changing world today, professional obsolescence can creep up on a
than there will be people who have an Enterprising type.
person. What makes a person valuable in today’s work environment is
“Investigative” people create an “Investigative” environment. For
the knowledge and experience he or she brings to a job.
example, they particularly value people who are precise,
DEMOTION – Process of moving a worker to a lower level of duties scientific, and intellectual—who are good at understanding and
and responsibilities, which typically involves a reduction in pay. solving science and math problems.
FREE AGENTS (BEING YOUR OWN BOSS) Examples of jobs that fit this description include architects and
FREE AGENTS. People who take charge of all or part of their careers physicians.
by being their own bosses or by working for others in ways that fit their
particular needs or wants. CAREER DEVELOPMENT AND CAREER DEVELOPMENT
METHODS
CAREER PLANNING APPROACHES
Career Development. Formal approach used by the organization to
 Career Planning. Ongoing process whereby an individual ensure that people with the proper qualifications and experiences are
sets career goals and identifies the means to achieve them. available when needed.
 “If you don’t know where you’re going, any road will get
you there” is certainly true in career planning. Career Career development programs are expected to achieve one or
planning must now accommodate a number of objectives more of the following objectives:
and enable us to prepare for each on a contingency basis.  Effective development of available talent. Individuals are
more likely to be committed to career development that is
SELF-ASSESSMENT – Process of learning about oneself. part of a specific career plan. This way, they can better
 Strength/Weakness Balance Sheet. A self-evaluation understand the purpose of development. Career
procedure, developed originally by Benjamin Franklin that development consistently ranks high on employees’ want
assists people in becoming aware of their strengths and lists, and they can often be a less expensive option than pay
weaknesses. raises and bonuses.
 Likes And Dislikes Survey. Procedure that helps  Self-appraisal opportunities for employees considering
individuals in recognizing restrictions they place on new or nontraditional career paths. Some excellent
themselves. workers do not view traditional upward mobility as a career
FORMAL ASSESSMENT – The use of established external option because firms today have fewer promotion options
approaches to facilitate evaluation of an issue at hand. available. Other workers see themselves in dead-end jobs
 Perhaps the most well-known example is the Myers-Briggs and seek relief. Rather than lose these workers, a firm can
Type Indicator. offer career planning to help them identify new and different
career paths.
The MBTI describes the following four preferences:  Development of career paths that cut across divisions
 Energy measures an individuals’ degree of extraversion or and geographic locations. The development should not be
introversion to determine whether a person gains energy through limited to a narrow spectrum of one part of a company.
interpersonal relationships (extraversion) or through self-reflection  A demonstration of a tangible commitment to
(introversion). developing a diverse work environment. Individuals who
 Information-Gathering measures a preference for gathering recognize a company as desiring a diverse environment
information about facts to consider before making a decision often have greater recruiting and retention opportunities.
(Sensing) or a preference for gathering information about  Satisfaction of employees’ specific development needs.
possibilities before making a decision. Individuals who see their personal development needs being
 Decision making measures a preference for the amount of met tend to be more satisfied with their jobs and the
consideration a person gives to their own or others’ feelings and organization. They tend to remain with the organization.
values relative to facts and details. Preferences to consider the
24
 Improvement of performance. The job itself is the most MANAGEMENT DEVELOPMENT
important influence on career development. Each job can Consists of all learning experiences provided by an organization
provide different challenges and experiences. resulting in upgrading skills and knowledge required in current and
 Increased employee loyalty and motivation, leading to future managerial positions.
decreased turnover. Individuals who believe that the firm is MENTORING AND COACHING
interested in their career planning are more likely to remain
 Mentoring and coaching have become important means of
with the organization.
management development. Because the purposes of
 A method of determining training and development mentoring and coaching are similar in concept and the terms
needs. If a person desires a certain career path and does are often used interchangeably in the literature, they are
not currently have the proper qualifications, this identifies a discussed together.
training and development need.
 Coaching and mentoring activities, which may occur either
MANAGER/EMPLOYEE SELF-SERVICE formally or informally, are primarily development
Manager and employee self-service have proven to be useful in career approaches emphasizing one-on-one learning.
development. Many companies are providing managers with the  Mentoring. Approach to advising, coaching, and nurturing
online ability to assist employees in planning their career paths and for creating a practical relationship to enhance individual
developing required competencies. Through employee self-service, career, personal, and professional growth and development.
employees are provided with the ability to update performance goals  Coaching. Often considered a responsibility of the
online and to enroll in training courses. immediate boss, who provides assistance, much like a
mentor.
DISCUSSIONS WITH KNOWLEDGEABLE INDIVIDUALS
In a formal discussion, the superior and subordinate employees may REVERSE MENTORING – A process in which older employees learn
jointly agree on what career development activities are best. The from younger ones.
resources made available to achieve these objectives may also
include developmental programs. In some organizations, human ORGANIZATION DEVELOPMENT: A STRATEGIC HUMAN
resource professionals are the focal point for providing assistance on RESOURCES TOOL
the topic. In other instances, psychologists and guidance counselors Individuals and groups receive the bulk of T&D effort. However, some
provide this service. In an academic setting, colleges and universities firms believe that to achieve needed change, they must move the
often provide career planning and development information to entire organization in a different direction. Efforts to achieve this are
students. Students often go to their professors for career advice. the focus of OD—planned and systematic attempts to change the
organization, typically to a more behavioral environment.
COMPANY MATERIAL
Some firms provide material specifically developed to assist in career SURVEY FEEDBACK – Organization development method of basing
development. Such material is tailored to the firm’s special needs. In change efforts on the systematic collection and measurement of
addition, job descriptions provide valuable insight for individuals to subordinate’s attitudes through anonymous questionnaires.
personally determine whether a match exists between their strengths  It enables management teams to help organizations create working
and weaknesses and specific positions. environments that lead to better working relationships, greater
PERFORMANCE APPRAISAL SYSTEM productivity, and increased profitability.
The firm’s performance appraisal system can also be a valuable tool Survey feedback generally involves the following steps:
in career development. Discussing an employee’s strengths and 1. Members of the organization, including top management, are
weaknesses with his or her supervisor can uncover developmental involved in planning the survey.
needs. If overcoming a particular weakness seems difficult or even 2. All members of the organizational unit participate in the survey.
impossible, an alternative career path may be the solution. 3. The OD consultant usually analyzes the data, tabulates results,
WORKSHOPS suggests approaches to diagnosis, and trains participants in the
Some organizations conduct workshops lasting two or three days for feedback process.
the purpose of helping workers develop careers within the company. 4. Data feedback usually begins at the top level of the organization and
Employees define and match their specific career objectives with the flows downward to groups reporting at successively lower levels.
needs of the company. At other times, the company may send workers 5. Feedback meetings provide an opportunity to discuss and interpret
to workshops available in the community or workers may initiate the data, diagnose problem areas, and develop action plans.
visit themselves.
QUALITY CIRCLES – Groups of employees who voluntarily meet
Consider just two of the developmental activities available for HR regularly with their supervisors to discuss problems, investigate
professionals: causes, recommend solutions, and take corrective action when
authorized to do so.
 Society for Human Resource Management Seminar
Series. Many HR seminars are available to SHRM
TEAM BUILDING – Conscious effort to develop effective work groups
members.
and cooperative skills throughout the organization.
 American Management Association, Human Resource
Seminars. There are numerous human resource seminars
LEARNING ORGANIZATION AS A STRATEGIC MINDSET
offered through the AMA.
A learning organization needs to provide a supportive
learning environment and it provides specific learning processes and
practices. Also, it is vital that management supports and reinforces
learning. A learning organization moves beyond delivering tactical
25
training projects to initiating learning programs aligned with strategic on a variety of other training programs including ethics, compliance
corporate goals. (for example, safety and health), and diversity training.
Learning organizations view learning and development 9. Explain the concept of a careers and career paths.
opportunities in all facets of their business and try to constantly look A career is the general course that a person chooses to pursue
ahead and ensure that all employees are taking full advantage of their throughout his or her working life. A career path is a flexible line of
learning opportunities. In a learning organization employees are movement through which a person may travel during his or her work
rewarded for learning and are provided enriched jobs, promotions, and life. Career paths include traditional career path, network career path,
compensation. Organizations with a reputation for having a culture of lateral skill path, dual-career path, adding value to your career,
being a learning leader tend to attract more and better-qualified demotion, and free agents.
employees. 10. Identify career planning approaches. Career planning is an
ongoing process whereby an individual sets career goals and identifies
TRAINING IN THE GLOBAL CONTEXT the means to achieve them. Self-assessment (for example, a likes
 It is important to recognize that broadening training practice and dislikes survey) and formal assessment approaches (for example,
to the world stage presents additional issues. For instance, surveys that measure how an individual would behave in particular
some countries distinguish themselves from others through situations) help organizations and employees with career planning.
the widespread use of specific training models.
 For example, the apprenticeship training model is prevalent LESSON 9: DIRECT FINANCIAL COMPENSATION
in some European countries such as Germany, and it is (CORE COMPENSATION)
successful there for a number of reasons because of the
collaborative efforts between schools and industry.
SUMMARY
1. Summarize the training and development process.
Training is designed to permit learners to acquire knowledge and
skills needed for their present jobs. Development involves learning
that goes beyond today’s job. The process begins with the
organization’s determination of its specific training needs. Then
specific objectives need to be established. After setting the T&D
objectives, management can determine the appropriate methods and
the delivery system to be used. Management must continuously
evaluate T&D to ensure its value in achieving organizational
objectives.
2. Explain how to determine specific training and development
needs and objectives. Training professionals rely on three analytic
approaches to determine training needs – organizational analysis, task
analysis, and person analysis.
3. Summarize various training methods. Training methods include
instructor-led training, e-learning, case study, behavior modeling, role-
playing, training games, in-basket training, on-the-job training, and
apprenticeship training.
4. Describe alternative training and development delivery
systems. Delivery systems include corporate universities, colleges
and universities, community colleges, online higher education,
vestibule system, video media, and simulators.
5. Summarize training and development implementation issues.
Implementing T&D programs is often difficult. One reason is that
managers are typically action-oriented and feel that they are too busy
for T&D. Training and development requires more creativity than
perhaps any other human resource function.
6. Explain the metrics for evaluating training and development.
Some possible metrics for evaluating training and development
include participants’ opinion, extent of learning, behavioral change,
accomplishment of T&D objectives, return on investment from training,
and benchmarking.
7. Explain factors influencing training and development.
There are numerous factors that both impact and are impacted by
T&D, including top management support, shortage of skilled workers,
technological advances, world complexity, lifetime learning, learning
styles, and other human resource functions.
8. Summarize some human resource management training
initiatives. Orientation is the guided adjustment of new employees to
the company, the job, and the work group. HR typically takes the lead
26

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STRATEGIC HR MANAGEMENT

LESSON 1 3. NONFINANCIAL COMPENSATION – Satisfaction receives from

PERFORMANCE MANAGEMENT - it is a goal-oriented process that

HUMAN RESOURCES DEVELOPMENT

CORPORATE SOCIAL RESPONSIBILITY (CSR) - the implied,

CORPORATE SUSTAINABILITY - focuses on the possible future

DISTINCTION OF CODE OF CONDUCT AND A CODE OF ETHICS

1. INSTITUTE OF HUMAN RESOURCE PROFESSIONALS MODELS OF THE PRACTITIONERS OF HR

STRATEGIC PLANNING is the process by which top management

HRM versus HR Strategies

APPROACHES TO STRATEGIC HRM

(3) HIGH-INVOLVEMENT MANAGEMENT

(2) SPECIFIC HR STRATEGIES CRITERIA FOR AN EFFECTIVE HR STRATEGY

THE BEST PRACTICE STRATEGY IMPLEMENTATION

‘A strategy’s success turns on combining “vertical” or external fit and

- Bundle are development and implementation of several HR practices

FORECASTING HUMAN RESOURCE REQUIREMENTS

ELEMENTS OF THE DIVERSE WORKFORCE Employee Referral

HR Internet Guides – www.hr-guide.com TRADITIONAL EXTERNAL RECRUITMENT METHODS

ENVIRONMENT OF RECRUITMENT Selection Process

Advantages and Disadvantages of Selection Tests

JOB-RELATED CRITERIA – Job-relatedness is perhaps the most SCHEDULING THE INTERVIEW

PERFORMANCE EXPECTATIONS INTERVIEW STRUCTURE

TASK ANALYSIS – A training needs assessment activity, which

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