EVOLUTION OF HR MGMT

1. EVOLUTION OF HR MGMT • SCIENTIFIC MANAGEMENT • Frederick Taylor, Henry Gantt, Frank & Lillian Gilbreth • INDUSTRIAL/ORGL PSYCHOLOGY • Munsterberg, Scott, Cattell • HUMAN RELATIONS MOVEMENT • Hawthorne Studies, Mayo, Follett, Lewin • GROWTH OF GOVERNMENTAL REGULATIONS • Wages (1930s), Unionization (1940s), Employment (1960s) • PROFESSIONALIZATION OF HR MANAGEMENT • Professional HR Societies & HRCI (Certification Institute)

2. EVOLUTION OF HR MGMT • SCIENTIFIC MANAGEMENT • Frederick Taylor, Henry Gantt, Frank & Lillian Gilbreth • HUMAN RELATIONS MOVEMENT • Hawthorne Studies, Mayo, Follett, Lewin • INDUSTRIAL/ORGL PSYCHOLOGY • Munsterberg, Scott, Cattell • HUMAN RESOURCE MOVEMENT • Theory Y, McGregor, Herzberg • GROWTH OF GOVERNMENTAL REGULATIONS • Wages (1930s), Unionization (1940s), Employment (1960s) • PROFESSIONALIZATION OF HR MANAGEMENT • Professional HR Societies & HRCI (Certification Institute)

3. SCIENTIFIC MANAGEMENT • Frederick Taylor • Midvale Steel • “Time Studies” • Simonds Rolling Machine Co • Redesigned jobs and productivity improvements (Job Descriptions & Incentives) • Selection and Training for workers • Bethlehem Steel • Coal shoveling and hauling steel “pigs” • The “Schmidt” experiment (aka Henry Noll) • Henry Gantt • Incremental Bonuses • Incentives for Foremen • Frank & Lillian Gilbreth • Motion Studies … “Therbligs” • Individual suggestion system

4. SCIENTIFIC MANAGEMENT ASSUMPTIONS • Productivity is a workplace problem • Managers should plan and direct the work of others • Individuals are economically motivated CONTRIBUTIONS • “Scientific” study of work (Time & Motion) • Setting of work standards • Use of incentives • Careful selection & training of workers • Division of labor---managers & workers • Productivity & efficiency increased LIMITATIONS • Social “needs” of workers overlooked • Many studies weren’t very scientific • Loss of self-control alienated workers • Group dynamics were ignored

5. HUMAN RELATIONS MOVEMENT • Hawthorne Studies at Western Electric Co • Illumination studies • Relay Assembly 1 • Relay Assembly 2 • Incentive Studies • Mica-splitting • Bank Wiring Room • Interview program • Discoveries at Hawthorne • Hawthorne Effect • Catharsis • Informal Group Influence

6. HAWTHORNE PLANTBank Wiring Room Layout I I W W W W W W W W W S S S _| |____________________________________________________________ doorway I = Inspector W = Wireman S = Solderer

7. Informal Groups that Emerged in the Bank Wiring Room II W WW WWWW W W S S S _| |____________________________________________________________ doorway Social Group 1 = red Social Group 2 = blue Deviates and Isolates not in either group = black

8. HUMAN RELATIONS MANAGEMENT ASSUMPTIONS • WORKERS ARE MOTIVATED BY SOCIAL NEEDS • SATISFIED WORKERS ARE PRODUCTIVE WORKERS CONTRIBUTIONS • EMPHASIS ON WORKER NEEDS AND MOTIVATION • “HAWTHORNE EFFECT”….ATTENTION GIVEN TO WORKERS HAS AN IMPACT ON THEIR BEHAVIOR • INFLUENCE OF THE INFORMAL GROUP • MANAGERS NEED STRONG SOCIAL SKILLS LIMITATIONS • HAPPY, SATISFIED WORKERS AREN’T NECESSARILY PRODUCTIVE • ECONOMIC ISSUES DO AFFECT WORKER PRODUCTIVITY • BORING WORK ISN’T LESS SO WITH A FRIENDLY SUPERVISOR…MOTIVATION IS STILL A PROBLEM • WORKERS FEEL SUPERVISOR INTEREST IN THEM ISN’T GENUINE…THEY’RE BEING MANIPULATED! • SHOULD BUSINESS BE RESPONSIBLE FOR MEETING ALL HUMAN NEEDS ON THE JOB?

9. HUMAN RESOURCES MANAGEMENT ASSUMPTIONS • INTERESTING WORK MOTIVATES INTRINSICALLY • WORKERS ARE TRUSTWORTHY…GIVE THEM RESPONSIBILITY • THE MANAGER’S JOB IS TO CHALLENGE WORKERS & TO DEVELOP THEIR TALENTS CONTRIBUTIONS • THEORY X AND THEORY Y • PARTICIPATIVE DECISION-MAKING AND MANAGEMENT • JOB REDESIGN AND JOB ENRICHMENT • MANAGEMENT BY OBJECTIVES • MORE RIGOROUSLY-TESTED THEORIES LIMITATIONS • NOT EVERYONE WANTS A CHALLENGING JOB • BEHAVIOR IS COMPLEX…THEORIES HAVE MANY EXCEPTIONS • ELEGANT THEORIES MAKE LITTLE SENSE TO MANAGERS…A LACK OF ACCEPTANCE PROBLEM

10. HUMAN CAPITAL MANAGEMENTMANAGING & MEASURING WORKER PRODUCTIVITY What is the effect of HR on the bottom line of the firm? Is there a significant relationship between compensation and worker turnover in our organization? Does worker training and development enhance retention? …customer satisfaction? …repeat sales levels? What value would you attribute to each worker? How much is each employee “worth?” Are all employees alike and thus should be managed similarly, or should each employee be developed and managed uniquely? What brings out the “best” in each worker? What makes them maximally productive and valuable to the organization?

11. PROFESSIONAL HR ORGANIZATIONS • SOCIETY FOR HUMAN RESOURCE MANAGEMENT • (SHRM) 250,000+ members • JNLS: HR Magazine, HR News • AMERICAN SOCIETY FOR TRAINING & DEVELOPMENT • (ASTD) 80,000+ members • JNL: Training & Development Journal • WORLD-AT-WORK (formerly the American Compensation Association) • (WAW) 23,000+ members • JNL: WAW/ACA Journal (formerly Compensation Review) • INTERNATIONAL PERSONNEL MANAGEMENT ASSOCIATION • (IPMA) 6500+ members • JNL: Public Personnel Management • NATIONAL HUMAN RESOURCE ASSOCIATION (formerly the Intl Assn for Personnel Women) • (NHRA) 1500+ members • JNL: Human Resources: Jnl of the International Assn for Personnel Women

12. HUMAN RESOURCE CERTIFICATION INSTITUTE (HRCI) • PROFESSIONAL IN HUMAN RESOURCES (PHR) • Need 4+ yrs HR experience (full-time, exempt position) or • 2+ yrs HR experience w/ appropriate bachelor’s degree or • 1+ yr HR experience w/ appropriate master’s degree • Students may sit for PHR exam; and have 5 years to get experience • Must pass comprehensive PHR examination (need a score of 500+) • Certified for 3 years / Re-certification required every 3 years • SENIOR PROFESSIONAL IN HUMAN RESOURCES (SPHR) • Need 8+ yrs HR experience (full-time, exempt position) or • 6+ yrs HR experience w/ appropriate bachelor’s degree or • 5+ yrs HR experience w/ appropriate master’s degree • SPHR candidates also need 3+ yrs experience at policy-making level • Must pass comprehensive SPHR examination (need a score of 500+) • Certified for 3 years/ Re-certification required every 3 years

13. HR CERTIFICATION EXAMFor Professional and Senior Professional HR Designation • TOPICS PHR SPHR • Strategic Management 12% 26% • Workforce Planning & Employment 26% 16% • HR Development 15% 13% • Compensation & Benefits 20% 16% • Employee & Labor Relations 21% 24% • Health, Safety and Security 6% 5% 100% 100% Must correctly answer at least 75% of the questions in each of the six areas to earn a 500 score (the minimum passing score).

14. HR CERTIFICATION EXAMFor Global Professional in Human Resources Designation • TOPICS GPHR • Strategic HR Management 22% • Organizational Effectiveness & Employee Development 14% • Global Staffing 10% • International Assignment Management 28% • Global Compensation & Benefits 16% • International Employee Relations & Regulations 10% 100% Must correctly answer at least 75% of the questions in each of the six areas to earn a 500 score (the minimum passing score).

15. Human Resource Management… • Working with people to achieve the organization’s objectives • All managers and supervisors have human resource management responsibilities • Requires that all managers follow good HRpractices and ethics to create a productive and motivating work environment • Covers five major functional areas

16. Human Resource Management Practices

17. Human Resource Management Functions 1 Employment and Staffing Appraisal, Training and Development Human Resource Management Employee and Labor Relations Compensation Planning and Research

18. FUNCTIONAL AREAS WITHIN HR • EMPLOYMENT / STAFFING • RECRUITMENT • SELECTION • APPRAISAL, TRAINING, AND DEVELOPMENT • PERFORMANCE APPRAISAL • TRAINING (including safety education) AND DEVELOPMENT • COMPENSATION • SALARIES, WAGES AND BENEFITS • INCENTIVE PLANS • EMPLOYEE RELATIONS • DISPUTE RESOLUTION AND DISCIPLINE • UNION RELATIONS • HR PLANNING AND RESEARCH • FORECASTING • JOB ANALYSIS • ATTITUDE SURVEYS • VALIDATION STUDIES

19. Responsibilities of HR Departments…

20. Employment / Staffing • Staffing - Process through which organization ensures it always has proper number of employees with appropriate skills in right jobs at right time to achieve organizational objectives • Human resource planning - Systematic process of matching the internal and external supply of people with job openings anticipated in the organization over a specified period of time . • Recruitment - Process of attracting individuals on a timely basis, in sufficient numbers, and with appropriate qualifications, to apply for jobs with an organization • Selection - Process of choosing from a group of applicants the individual best suited for a particular position and the organization

21. Top 10 Generic Qualities Employers Seek in Job Candidates • Communication skills (written & verbal) • Honesty/integrity • Dependability/conscientiousness • Motivation/initiative • Attention to detail • Interpersonal skills • Adaptability/flexibility • Analytical/logical • Computer skills • Teamwork

22. Appraisal,Training, and Development • Performance appraisal - Formal system of review and evaluation of individual or team task performance • Performance management - Goal-oriented process directed toward ensuring organizational processes are in place to maximize productivity of employees, teams, and ultimately, the organization • Training - Designed to provide learners with knowledge and skills needed for their present jobs • Development - Involves learning that goes beyond today's job; it has more long-term focus • Career development - Formal approach used by organization to ensure that people with proper qualifications and experiences are available when needed • Organization development - Planned process of improving organization by developing its structures, systems, and processes to improve effectiveness and achieving desired goals

23. At Southwest Airlines, the company’s focus is on keeping employees loyal, motivated, trained, and compensated. In turn, there is a low turnover rate and a high rate of customer satisfaction.

24. Engaged, Enabled Employees Deliver Bottom-Line Benefits

25. Compensation • Direct Financial Compensation -Pay that person receives in form of wages, salaries, bonuses, and commissions. • Indirect Financial Compensation (Benefits) -All financial rewards not included in direct compensation such as paid vacations, sick leave, holidays, and medical insurance. • Nonfinancial Compensation - Satisfaction that person receives from job itself or from psychological and/or physical environment in which person works.

26. Employee and Labor Relations • Private-sector union membership has fallen from 39 percent in 1958 to 7.8 percent in 2007. • Business is required by law to recognize a union and bargain with it in good faith if the firm’s employees want the union to represent them • Is the function of HR to control workers, or to help them and act as their advocate? • Resolving personnel grievances and disagreements fairly in both union and union-free environments

27. Human Resource Research • Human resource research pervadesall HR functional areas. • Forecasting and Planning • Job Analysis • Attitude Surveys • Validation Studies • Compensation Surveys

28. Most Workers Are Satisfied With Their Jobs GALLUP POLL

29. Questions asked in HR Today • Can some HR tasks be performed more efficiently by line managers, supervisors, or outside vendors? • Can some HR tasks be centralized or eliminated altogether? • Can technology perform tasks that were previously done by HR personnel? • Can we shrink the HR department and still create a high-performance work environment? • What role should HR fill today and specifically… what HR role do I play in my firm?

30. AMA SARATOGA STUDYHow are HR Departments Changing? • ONLY 30% STILL DO ALL STANDARD IN-HOUSE HR FUNCTIONS • 32% HAVE ESTABLISHED AN IN-HOUSE “UNIVERSITY” • ONLY 27% HAVE RETAINED THE TRAINING AREA “AS IS” • BENEFITS HAVE BEEN OUTSOURCED OR MOVED TO SHARED SERVICE CENTERS • STAFFING IS BEING DELEGATED BACK TO LINE MANAGERS • RATIO OF EMPLOYEES SERVED PER HR EMPLOYEE HAS INCREASED

31. Who Performs Human Resource Management Tasks? • Human Resource Managers • Line Managers and Supervisors • HR Shared Service Centers • HR Specialty Firms (Outsourced Functions) • Professional Employer Orgs (Employee Leasing)

32. Supervisors’ Involvement in HRM

33. Traditional Human Resource Functions in a Large Firm President and CEO Vice President, Marketing Vice President, Operations Vice President, Finance Vice President, Human Resources Appraisal, Training and Development Compensation Employment and Staffing Planning, Safety and Research Employee Relations

34. A Possible Evolving HR Organization Example President and CEO Vice President, Operations Vice President, Strategic Human Resources Vice President, Finance Vice President, Marketing Director of Safety and Health Training & Development (Outsourced) Compensation (Shared Service Centers) Staffing (more involvement of Line Managers, etc)

35. Philosophically… What is HR Supposed to Do? • HR is supposed to keep the firm out of lawsuits and legal trouble, but… • HR is also supposed to keep the workers happy and productive. WHICH WAY DOES HR LEAN IN YOUR FIRM? • Does HR primarily serve the workers… acting as their advocate, or is HR supposed to “keep the workers in line” for top management? ARE HR PEOPLE HIRED TO SERVE EMPLOYEES …OR TO MANAGE THE EMPLOYEES?

36. ETHICS IN HUMAN RESOURCE MGMT Many ethical issues in the workplace involve human resource management. DO EMPLOYEES HAVE RIGHTS? • RIGHT OF FREE CONSENT (no coercion) • RIGHT OF PRIVACY (no unnecessary intrusion) • RIGHT OF FREEDOM OF SPEECH • RIGHT OF DUE PROCESS (a fair hearing)

37. Ethical companies act according to four principles: • In their relationships with customers, vendors, and clients; ethical companies emphasize mutual benefits and don’t attempt to take advantage of others. • Employees assume responsibility for the actions of the company and attempt to act in the best interests of their customers and constituents. • The company has a sense of purpose or vision that employees value and use in their day-to-day work. • They emphasize fairness and live by the rule…”do no harm to others.”

38. Standards for Identifying Ethical Practices

39. Standards for Identifying Ethical Human Resource Management Practices • HRM practices must result in the greatest good for the largest number of people. • Employment practices must respect basic human rights of privacy, due process, consent, and free speech. • Managers must treat employees and customers equitably and fairly. • Treat your employees and customers the way you’d like to be treated…The “Golden Rule”

40. EXTERNAL FACTORS THAT IMPACT HRM • LABOR FORCE DEMOGRAPHICS • Women with Children • Workforce Diversity and Immigrants • Older Workers • People with Disabilities • Young Persons with Limited Skills • TECHNOLOGICAL ADVANCEMENT • Computers & Automation (skills need renewal, otherwise obsolete wkrs) • Cyberwork (Blackberrys, cell phones, texting…workers on call 24/7) • GLOBAL COMPETITION AND CUSTOMER EXPECTATIONS • GOVERNMENTS AND REGULATIONS • Federal, State and Local • ECONOMIC CONDITIONS AND CYCLES • OTHER PUBLICS • Unions, Communities, Shareholders, etc.

41. INTERNAL FACTORS THAT IMPACT HRM • CORPORATE MISSION, PHILOSOPHY & CULTURE • Who are we and what are we trying to accomplish? • CORPORATE STRATEGIES AND OBJECTIVES • Grand and Competitive Strategies • ORGANIZATION POLICIES AND PROCEDURES • Bureaucratic vs Organic? Is Discretion Encouraged? • TASKS, POSITIONS & WORK GROUPS • The Organizational “Chart” • LEADERSHIP STYLES • McGregor – Theory X or Theory Y? • French & Raven - Power/Influence View • Hersey & Blanchard – Maturity/Life-Cycle View • House & Mitchell – Path-Goal View

42. THEORY X and THEORY YMcGregor THEORY X THE AVERAGE WORKER: • DISLIKES WORK AND WILL AVOID IT IF POSSIBLE • MUST BE COERCED, CONTROLLED, OR REWARDED TO ACHIEVE WORK OBJECTIVES • PREFERS DIRECTION… WANTS TO BE TOLD WHAT TO DO • WISHES TO AVOID RESPONSIBILITY… HAS LITTLE AMBITION • WANTS SECURITY ABOVE ALL Must be closely monitored and supervised all the time because you can’t trust these employees THEORY Y THE AVERAGE WORKER: • SEEKS CHALLENGE AND GROWTH IN HIS/HER JOB • IS MOTIVATED BY THE WORK ITSELF • PREFERS SELF-DIRECTION AND INDEPENDENCE • ACCEPTS RESPONSIBILITY AND WILL WORK HARD TO ACHIEVE WORK OBJECTIVES • IS CREATIVE, MAKES SUGGESTIONS, AND WANTS TO PARTICIPATE IN WORK DECISIONS Give more autonomy and discretion to you employees, and provide them with challenging work and growth opportunities. You can trust them!

43. POWER & INFLUENCE MODEL(French & Raven) • LEGITIMATE POWER (Obtained from the organization) • Authority based on the Position • REWARD POWER (Obtained mostly from the organization) • Positive, based on Desired Outcomes • COERCIVE POWER (Obtained mostly from the organization) • Threats. Punishment • EXPERT POWER (Obtained from the employees) • Advice, Knowledge, Information • REFERENT POWER (Obtained from the employees) • Charisma, Social Liking, Identification

44. DISCOVERIES ON POWER-BASED LEADERSHIP (YUKL 89) • COERCIVE POWER • Generates Resistance (You Get Minimal Cooperation) • LEGITIMATE & REWARD POWER • Generates Compliance (You Get Satisfactory Behaviors) • EXPERT & REFERENT POWER • Generates Commitment (Your Workers Go the 2nd Mile)

45. LIFE-CYCLE (MATURITY) THEORY(HERSEY & BLANCHARD 77) • LEADER BEHAVIORS NEED TO VARY, DEPENDING ON THE MATURITY OF THE INDIVIDUAL. (…a contingent view) • DIRECTIVE • Gives clear direction and instruction to immature employees • COACHING • Expands two-way communication; helps build confidence/motivation • SUPPORTING • Employee now feels confident; active two-way communication still needed for shared decisions • DELEGATING • Responsibility for planning and decision making given to highly mature employees

46. PATH-GOAL THEORY OF LEADERSHIP(House & Mitchell 74) • SITUATIONAL FACTORS • CHARACTERISTICS OF EMPLOYEES • Perceived Ability, N ACH, Locus of Control, etc. • CHARACTERISTICS OF THE ENVIRONMENT • Task Structure, Organizational Controls, Work Group, etc. • LEADERSHIP STYLES • DIRECTIVE • SUPPORTIVE • ACHIEVMENT ORIENTED • PARTICIPATIVE

47. IMPACT OF PERSONAL DIFFERENCES ON HRM INDIVIDUAL ABILITIES & SKILLS PERSONALITY High vs Low N-ACH, High Conscientiousness Intuiting vs Sensing, Thinking vs Feeling, and Perceiving vs Judging, EXPECTATIONS AND ASPIRATIONS Looking to the Future vs Guided by the Past MOTIVATION Equity Theory Expectancy Theory Reinforcement Theory

48. EQUITY THEORY (ADAMS 65) • I compare my work outcomes (Om) with my perception of what others’ outcomes are (Oo). I also compare my work inputs (Im) with what I think others are contributing to their jobs (Io). • If the relative ratio of my outcomes/inputs (Om/Im) is similar to the perceived outcomes/inputs (Oo/Io) of others at work, EQUITY exists and the organization is perceived to be “fair.” (Om/Im) = (Oo/Io) I feel fairly treated (content)

49. PERCEPTIONS OF INEQUITY(… my organization isn’t fair) • If I believe my outcomes/inputs ratio is more generous than the outcome/input ratio of others, I feel guilty and over-rewarded. This is POSITIVE INEQUITY, and this perception may or may not motivate one to action. (Om/Im) > (Oo/Io) I feel over-rewarded (guilty) • If I think my outcomes/inputs ratio is less than the outcome/input ratio of others, I feel frustrated, unappreciated, and under-rewarded. This is NEGATIVE INEQUITY, and this perception usually motivates one to act to resolve this “unfair” situation. (Om/Im) < (Oo/Io) I feel under-rewarded (frustrated)

50. LIKELY RESPONSES WHEN INEQUITY IS PERCEIVED ATTEMPT TO RESTORE A SENSE OF EQUITY (FAIRNESS) BY… • CHANGING MY OUTCOMES • CHANGING MY INPUTS • RECONSIDERING MY PERCEIVED RATIOS • CHANGING “OTHER’S” INPUTS OR OUTCOMES • CHANGING MY COMPARISON “OTHER” • LEAVING THE ORGANIZATION THESE STRATEGIES ARE USED FOR RESOLVING PERCEPTIONS OF BOTH POSITIVE AND NEGATIVE INEQUITY