FACULTYOFMANAGEMENTSTUDIES

UNIVERSITYOFDELHI

M.B.A.(FullTime):JulyOctober2008

Paper:F106
HUMANRESOURCEMANAGEMENT
SupplementaryReadingMaterials

Facilitator:Dr.A.VenkatRaman

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

HUMANRESOURCESMANAGEMENTINACHANGINGENVIRONMENT

I.

Introduction
Theworldofworkcontinuestochange,butatamorerapidpace.

Changes in the world marketplace, corporate strategies, work force composition,

andmanagementstrategiesaffectHRMgoalsandpractices.

II.TheGlobalVillageanditsHRMImplications

Since late 80s, Indian companies finally realized the importance of worldwide
competition. The rise of multinational and transnational corporations places new
requirementsonHRmanagers.

A.Whatistheglobalvillage?

Thistermreferstothefactthatbusinessestodayoperatearoundtheworld.
Ensuring that employees can operate in the appropriate cultural milieu and that
communicationsareunderstoodbyamultilingualdiverseworkforce.
Workersmustalsobeabletooperateinculturesthatdifferonvariablessuchas
statusdifferentiation,societaluncertainty,assertiveness,andindividualism.
HRMalsomusthelpmulticulturalgroupsworktogether.

B.GlobalisationandHRM

Culturalenvironmentsthatarediverserequiremoreflexiblemanagementpracticesin
termsofHiring,Training,RewardingandMotivatingemployeesandmanagers.

Indianworkforceisstrikinglyheterogeneous.
Employees have different aspirations while taking up job / career in an
organizationdependingontheirsocialandeconomicbackground;andtheylearn
informallywhentheyworkwithindividualsfromdifferentcultures.
Technology, Changing demographics, and Globalization have resulted in diverse
workforceinwhichtheproportionofwomenissignificantlyincreasing.
Need to attract and maintain a diversified work force that also reflects the
diversityamongcustomers.
Managing employees in different age groups, social (subcultural groups) and
helpingthemtoworktogetherisalsoanHRMchallenge
Changing Skills Requirements: Increasing proportion of workers are now
employedintheservicesector,butthequality,capabilityandthetechnicalskillis
farfromsatisfactory.
Skilldeficienciescostcompaniesbillionsofdollars.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

C. CorporateDownsizing(Restructuring,Retrenchment,andDownSizing)andHRM

The rationale behind downsizing: Organizations have sought greater

efficiencybyreducingthenumbersofworkersandbyincreasingmanagers
spansofcontrol.
Downsizing and the HRM Implications: HRMs role includes ensuring
adequate communications, job redesign, training, and support for both
thoseleavingandsurviving.Inmanycasestheoverallperformancehasnot
been drastically improved, and some companies have hired employees
back.

D. ContinuousImprovementPrograms

This approach to management involves making constant efforts to better

products and service to customers, use of statistical controls and
managementsroleinachievingproductivity.
Effective improvement processes must be supported by top management
andinvolvecustomersandemployeesthroughouttheorganization.Unions
haverecognizedthevalueofimprovementefforts.
HRMmustprepareindividualsforchangeandprovidetraining.

E. ReengineeringWorkProcessforImprovedProductivity.

Reengineering occurs when more than 70 percent of the work processes

are evaluated and altered. While TQM involves ongoing incremental
changes,reengineeringinvolvesradicalchangeofentireworkprocesses.
Typicallythreefeaturesareincluded:customerfocus,productionfriendly
organizational structure, and thinking about organizational work from
scratch.
Its not a quick fix, and should not be used to simply downsize.
Management must be willing to change leadership styles, involve workers
andbuildteams.
Reengineering versus Continuous Improvements: Reengineering may be
neededtoreplaceoutdatedproductsorsystems;Continuousimprovement
canbeusedtomonitorandimprovetheupdatedprocesses.
HRM and Reengineering: HRMs role includes helping employees to deal
withemotionalaspectsofconflictandchange,providingskillstraining,and
adapting HR systems, such as compensation, benefits, and performance
standards.

F. TheContingentWorkForce

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

Unpredictabilityoftheeconomicenvironmenthasledtoorganizations
hiringtwotypesofworkers:CorepermanentStaff,andContingent
contractStaff.Contingentworkersincludeparttime,temporaryand
contractworkers.
AreContingentWorkersThrowAwayWorkers?:Althoughuseof
contingentworkersisgrowing,itisdifficulttostatetheirlegalstatusis
controversial.

HRMsroleincludesplanningforvirtualemployees,recruitingthem,and
helpingthemtoadapttotheorganization,aswellasdealingwithpotential
conflictsbetweencoreandcontingentworkers.
G. DecentralizedWorkSites

Some companies are asking their employees to work out of their homes,
andtokeepintouchviatheircomputers,modemsandfaxmachines.
Work is Where Your Computer Is: Technology makes telecommuting
possiblefromanywhereontheglobe.Sucharrangementsmeettheneeds
ofadiversifiedworkforce,reducetrafficcongestion,reducecosts,andhelp
organizations obtain qualified workers. Currently about 15 percent of the
workforceworksathome,intheUS.
HRM and Decentralized Work Sites: HRM can help managers supervise
home workers, and must ensure that compensation and legal protections
areappropriateinnontraditionalworksettings.

H. EmployeeInvolvement

In todays lean and mean work environment, employees at all levels are
expected to be more involved in decisionmaking relevant to their work.
This may include delegation of authority to lower level employees,
participativemanagementusinggroupdecisionmaking,andinvolvement
ofemployeesonworkteams.
HRM must provide training to help employees in these new roles, so that
involvement programs can achieve greater productivity, as well as
increasedemployeeloyaltyandcommitment.

I.TQMandHRM

TQM is anapproach based on continuous process improvement; focus on the

customer, and involvement of employees. Some organizations emphasize
statistical quality control to reduce the number of defects in a product or
number of problems with a service operation. Others have emphasized
frequentcustomercontactandsatisfaction.ManyTQMprogramsdonotstart
in the HR office, but HR definitely has a role to play in supporting an
organizations quality efforts. In order to implement a TQM approach,
managers and employees must work together to set standards, to evaluate
their products and services, and to bring about improvement. Selecting the
Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

right employees for a TQM environment, training them, and monitoring the
organizationsprogressareallareaswhereHRexpertisecanhelp.

J.Delayering,SpanofControl,HRMandOrganizationalEfficiency

In theory, delayering management, or cutting out middle layers of

management,makesanorganizationmoreefficientbecausethecostsofpaying
those people are eliminated. For example, suppose an organization has 3
workersreportingtoasupervisor,threesupervisorsreportingtoeachdirector,
3 vice presidents reporting to the CEO. The span of control is 3 in that
organization. Suppose the span of control were increased to 6 at only the
lowest level of the organization. Half of the supervisors could be eliminated,
andtherefore,halfofthedirectorsandonevicepresident.Itisusuallydifficult
to justify alayerofmanagement with only one person in it, so theremaining
vicepresident position might also be eliminated. If the span of control were
increaseduptheorganization,evenmoresavingswouldberealized.

Inreality,however,increasingthespanofcontroldoesnotnecessarilyincrease
efficiency. Work quality may suffer; morale and commitment are often
lessened; communication may become bottle necked. If fewer managers are
available to solve problems and represent their work units to customers and
others in the organization, employees need to learn to take on these
responsibilitiesandlearntheseskills,possiblyaspartoftheirnewrolesasself
managing team members. Downsizing to save costs in the short term is
effective.However,overthelongterm,ifdownsizingweredoneonlytosave
costs, there is a negative organizational impact. The role of HRM is to make
sure that downsizing is done strategically, rather than as a cost cutting
expedient.

K.EmployeeEmpowerment

Autonomyandcontroloverworkprocesshasbeenshowntobeimportant
for some employees decades ago (Hackman and Oldham's work on the
MotivatingPotential Score.) Recent social trendsand theexpectationsof
younger workers have made empowerment a reality for more employees.
The new expectation is for more responsibility and more autonomy. As
such,ifempowermentistrulysatisfyingemployees'needs,itwillnotbea
fad. Some firms may implement empowerment in a faddish way. If
managers dont take the time to provide the training and the support
neededtodevelopcompetentempoweredworkers,empowermentwilllead
toneithermoresatisfiednormoreproductiveworkers

Therefore,Empowermentis

Skilledcapableworkers+

Trustingenvironment+

Supervisorswillingtoletgo+
Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

Timetomakeithappen+

Training+

Supportfromthetop.

L.CorporateDayCareprogramsandWomenEmployees

Femalesarebecomingalargerportionofthelabourpool.Thebenefitsofdaycare
oftensignalamorehumanapproachtolifestyleissuesthatareimportantnotonly
tofemaleswithchildren, buttoallworkerswho valuelifestyleconsiderationsas
well as workplace. Figures show that absenteeism, turnover, and stressrelated
complaintsarelowerfororganizationsthatprovidedaycareandthatmoraleand
commitmentareimprovedinthoseorganizations.

Mostoftheabovementionedchangesrepresentchangesinourworkforce,economyand
technology;somerepresentorganizationresponsestothesechanges,suchasdownsizing
and empowerment. It is impossible to effectively implement any of the organizational
effectiveness programs without considering some of these trends. For example, a TQM
studymayindicatethatentireworkprocessesmustbereengineered,leadingtochanging
skill requirements and downsizing. Work force diversity and skill availability must be
consideredwhenhiringneededindividualstofittheneworganizationalstructures,which
areputinplacetoachievecompetitiveness.

Notes:

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

I.

HUMANRESOURCEPLANNINGANDCORPORATESTRATEGIES

Introduction
Manpower Planning (MPP) is the Quantitative estimation of the number of
people required (Demand Forecasting) and the number of people available
(SupplyAnalysis)inanorganization,inagiventimeframe.

HumanResourcePlanning(HRP)isaprocessbywhichanorganizationensures
that it has the optimum number of people, capable of effectively and efficiently
completingthosetasksthatwillhelptheorganizationachieveitsoverallstrategic
objectives.

HRP not only includes MPP, i.e. the quantitative estimation of number of
employeesneededandavailable,butalsotakesstockoftheexistingdeploymentof
the workforce, their skills, capabilities, competences, and identify any manpower
imbalances. If the existing deployment exceeds the optimum number, the
organization may resort to the option of down sizing, retrenchment, lay offs or
business expansion, diversification, enhanced production capacity, etc. If the
human resource imbalance occurs due to inadequate supply (wastage due to
turnover,etc),thenretentionstrategiesneedtobeexplored.

HRPislinkedtotheorganizationsoverallstrategyandplanningtocompete
domesticallyandglobally.Overallplansandobjectivesmustbetranslatedintothe
numberandtypesofworkersneeded.

SeniorHRMstaffneedstoleadtopmanagementinplanningforHRissues.

II.

PrerequisiteforHRP:
OutlinetheBusinessStrategiesandStrategicPlanningFrameworkofthe
Organization,intermsof:

A mission statement, which defines what business the organization is in,

includingwhyitexists,andwhoitscustomersare.
Strategic goals as set by senior management to establish targets for the
organizationtoachieve.
Objectives as defined for the next 520 years, and a SWOT Analysis that
determineswhatisneededtomeetobjectives.
Thedirection(strategy)andstructureofthecompanyaredetermined.
JobAnalysisisusedtodeterminewhatknowledge,skillsandabilitiesthatare
requiredbytheorganizationshumanresources.

LinkOrganizationalStrategytoHRP.
Ensurethatpeopleareavailabletomeet
therequirementssetduringstrategicplanning.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

 Assess current human resources, i.e. human resources inventory report, which
summarizesinformationoncurrentworkersandtheirskills.

Design and implement Human Resource Information Systems (HRIS), i.e. a

computerizeddatabasethatcontainimportantinformationaboutemployees

Develop Replacement Charts, which portray middletoupper level management

positions,whichmaybecomevacantinthenearfutureandlistinformationabout
individuals who might qualify to fill the positions. They are used for succession
planning.

III.ThedemandforLabour

A human resource inventory can be developed to project yearbyyear

estimatesoffutureHRneedsforeachjoblevelandtype.Forecastsmustbe
madeforneedsforspecificknowledge,skillsandabilities.
IV.EstimatingtheFutureSupplyofLabour:

A units supply of human resources comes from new hires, contingent

workers, transfersin or individuals returning from leaves. Transfers are
moredifficulttopredictsincetheydependonactionsinotherunits.
Decreases in internal supply come about through retirements, dismissals,
transfersout, layoffs, voluntary quits, sabbaticals, prolonged illnesses, or
deaths. Retirements are the easiest to forecast. Some of these factors are
morecontrollablebymanagementthanothers.

V. MatchingtheDemandandSupplyofLabour

Currentandfutureshortagesandoverstaffingshouldbeevaluated.
Recruitment,Training,ProductivityImprovementmaybeusedtomatch
supplywithdemand.

VI.DeterminingRequiredSkills,KnowledgeandAbilities

JobAnalysis:asystematicexplorationoftheactivitieswithinajob;it
definesanddocumentstheduties,responsibilitiesandaccountabilitiesofa
job.

JobAnalysisMethodsare,
1.
Observationmethod
2.
Individualinterviewmethod
3.
Groupinterviewmethod
4.
Structuredquestionnairemethod
5.
Technicalconferencemethod
6.
Diarymethod

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

 JobAnalysisStepsare
1.
Understandthepurposeofconductingthejobanalysis.
2.
Understandtheroleofjobsandvaluesintheorganization.
3.
BenchmarkpositionsChooserepresentativejobs.
4.
Seekclarification,wherevernecessary.
5.
Developthefirstdraftofthejobdescription.
6.
Reviewdraftwiththejobsupervisor.

PositionAnalysisQuestionnaire(PAQ)(developedatPurdueUniversity),
in which Jobs are rated on 194elements,grouped in six divisionsand 28
sections. The elements represent requirements that are applicable to all
typesofjobs.Thistypeofquantitativequestionnaireallowsmanydifferent
jobstobecomparedwitheachother.

VII.

PurposeofJobAnalysis
AlmostalHRMactivitiesaretiedtojobanalysis.
JobanalysisisthestartingpointforsoundHRM.

A.JobDescriptions
i.Writtenstatementofwhatjobholderdoes,howdone,underwhat
conditionsandwhy.
ii.Commonformat:title;duties;distinguishingcharacteristics;
environmentalconditions;authorityandresponsibilities.
iii.Usedtogiveinformationtoapplicants,toguidenewemployees,andto
evaluateemployees.
B.JobSpecifications
i. Statestheminimumacceptablequalifications,experienceand
personalitytraits.
ii. Usedwhenselectingqualifiedemployees.
C.JobEvaluation
i.Specifiestherelativevalueofeachjobintheorganization.
ii.Usedtodesignequitablecompensationprogram.

CurrentIssuesinHRP
A.Downsizing
i. HRP is often ignored in declining industries; Employee cuts are
consideredtobequickfixsolutions;Productivityoftenfell.
ii. Paradoxically many companies now hire and lay off employees at the
sametime.
iii.Rightsizing,i.e.searchfortheoptimalnumberismostchallenging.

B.LittleHelpwhileDownsizing

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

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i.Outplacementprovidesassistancetoexistingemployeeswhomustfind
ajoboutsidethecompany.Itmayincludejobhelpservices,VRS,financial
assistance, psychological counselling, support groups, severance pay,
extendedinsurancebenefitsanddetailedcommunications.

ii. The crucial period for outplaced employees is the first three to six
months.Costsofoutplacementrangeintothethousandsforeachindividual.

iii. Layoffsurvivor sickness is a set of attitudes, perceptions, and

behaviours of employees who remain following involuntary employee
reductions.

iv.Employerscanprovidesupportintheformofcounselling,group
discussionstoventfeelings,andimplementationofemployeeparticipation
programs.

Review:

DefiningHRP

Strategichumanresourceplanningistheprocessbywhichanorganizationensuresthatit
hastherightnumberandkindsofpeople,capableofeffectivelyandefficientlycompleting
thosetasksthatareindirectsupportofthecompany'smission.

WhatisinvolvedintheHRPprocess?

HRPisbasedonthestrategicplanningprocessfortheorganization,whichdeterminesthe
organizational mission, goals and objectives. HRP includes assessing current human
resources, estimating the supplies and demand for labour, and matching demand with
current supplies of labour. Outcomes of this process include recruitment, rightsizing,
reassignmentofemployees,orevenadjustmentintheorganizationsobjectives,basedon
availabilityofhumanresources.

DefiningJobAnalysis

Jobanalysisisasystematicexplorationoftheactivitiessurroundingandwithinajob.It
defines the jobs duties, responsibilities, and accountability. It is the process used to
documentjobrequirements,andprovidestheinformationonwhichtobaseHRsystems
forselection,performanceappraisal,training,compensationanddiscipline.

AdvantagesandDisadvantagesofObservationMethod,Structured
QuestionnaireMethod,andDiaryMethodofJobAnalysisTechniques

Observationmethodcancollectaccuratedata,quickly,andcanassimilatethatdataeasily
withotherdata.Behaviourscanbeaccuratelydescribed.Theobserverhastheadvantage
Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

11

ofadispassionate,impartialopinionaboutthejob.Therearedisadvantageswhenusing
theobservationmethod.Workersmayactdifferentlyiftheyareobserved.Theobserver
may be watching the wrong thing. Typical events may not occur in the time period
watched. Theobservermaynotunderstandwhatheorshesees.Ifmultipleobservers
areused,theymustbetrainedtoconsistentlyreportthesamebehaviours.

The structuredquestionnaire methodhasseveraladvantages. Consistentresponsesare

obtainedbecausethesamequestionsareaskedofallworkers.Itiseasytotrainanalysts
inthetechnique.Theformatiseasytoanalyse.Disadvantagesofthetechniquearethat
thewrongquestionsmaybeaskedorthewrongpeoplemaybeinterviewed.

Thediarymethodisusefulingatheringsubtle,nonroutineorcomplexdataaboutajob.
Itprovidesinformationthatmaynotbeobvioustotheobserver.Itallowstheincumbent,
theexpert,torecordimportantjobcharacteristics.Analysts do nothavetodothedata
collectionorbetrainedtodoit.However,thereareseveraldisadvantageswiththediary
method.Incumbentsmayrecordthewrongdata.Differentincumbentsmayhavevastly
differentideasaboutthenatureoftheirwork.Theirreportsmaybeinaccurate,orduties
considered more or less important than they actually are. Keeping a diary is time
consuming. Workersoften forget andmay needto be prompted to recordtheir events.
Suchpromptingmayaltertheaccuracyoftherecordeddata.Dataisdifficulttoanalyse.
Itusuallyrequirescontentanalysis,amessytechnique.

MeaningofJobDescription,JobSpecification,andJobEvaluation

Job descriptions are written statements of what the jobholder does (duties and
responsibilities); job specifications identify the personal characteristics required to
perform successfully on the job; and job evaluation is the process of using job analysis
informationinestablishingacompensationsystem.

HRImplicationswhenanorganizationisinaRetrenchmentmode.

OrganizationsoftendonotdoagoodjobofstrategicHRPwhentheyareinretrenchment.
However,afirmthatabandonsplanningduringretrenchmentisprobablydoomed.The
labourpoolsourceisfocusedontheinternal.Longrangeplanningisextremelyimportant
during downsizing. Employees who may be useful should be retained if at all possible.
The focus is often more on outplacement, in which case the firm should seek to not
alienateformeremployeesorthecommunityatlarge.

External supply of employees for meeting future employee needs is better

becausetheseemployeesbringnewblood'intoanorganization,resultingin
moreinnovativeandcreativeideas

Outsideemployeesareindeedneededtobringnewideas,newbloodintoanorganization,
particularly if an organization is a stable bureaucracy where innovation is not valued.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

12

Theoutsiderisgoodatbringingafreshperspectivetooldproblems.Forfirmsthatvalue
innovationandinsight,bringinginoutsidersisagoodwaytoaccomplishthatgoal.

But,fororganizationsthatdonotwanttorocktheboat,newemployeeshiredfromthe
outsideshouldbeavoided.Iftheorganization'sculturedictatethatthewaythingshave
alwaysbeendoneisthebestwaytodothem,newbloodshouldnotbe(andusuallyisnot)
broughtinabove theentrylevel.Duringorientation,employeesaretaughttothinkthe
right way. Most theorists view the world as one of increasing turbulence and change,
withthetraditionalwaysofviewingtheworldanddoingbusinessasnolongeradequate.
Theproblem,then,isforstablebureaucraciestobeabletochangeenoughtoacceptnew
ideas.
RECRUITMENTANDSELECTION

I.
Introduction

Once an organization identifies its human resource needs through HRP, it can
begintheprocessofrecruitingpotentiallyqualifiedapplicants.

Recruitingbringstogetherthosewithjobstofillandthoseseekingjobs.Selection,
whichdetermineswhichcandidatestohire,isthenextstepinthestaffingprocess.

II.
RecruitingGoals

Toestablishthecontactwiththepotentialsourcesandprovideinformationthat
will attract a good number of qualified candidates and discourage unqualified
onesfromapplying.

A.Factorsthataffectrecruitingefforts

1.Organizationalsize

2.Employmentconditions

3.Workingconditions,salaryandbenefitsoffered

4.Organizationalgrowthordecline

B. Factors that limit managers freedom to recruitand select a candidate of their

choiceinclude

1.Imageoftheorganization

2.Attractivenessofthejob
3. Internal organizational policies, such as encouraging promotion from
within,thanexternalhire.
4.Governmentinfluence,suchasReservationlaws.
5.Recruitingcosts

C.RecruitingfromanInternationalPerspective.

Forsomepositions,thewholeworldisarelevantlabourmarket.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

13

1. Homecountry nationals are recruited when an organization is

searchingforsomeonewithextensivecompanyexperiencetolaunchavery
technicalproductinacountrywhereithasneversoldbefore.

2.Hostcountry nationalsare targetedasrecruitswhencompanieswant

eachforeignsubsidiarytohaveitsowndistinctnationalidentity.Insome
countries,lawscontrolhowmanyexpatriatesacorporationcansend.Host
country nationals minimize potential problems with language, family
adjustmentandhostilepoliticalenvironments.

3.Recruitingregardlessofnationalitymaydevelopanexecutivecadrewith
atrulyglobalperspective.
RecruitingSources:Theseshouldmatchthepositiontobefilled.

III.

Theinternalsearch:

A. Organizations that promote from within identify current employees for job
openingsbyhavingindividualsbidforjobs,byusingtheirHRInformationsystem
orbyutilizingemployeereferences.
Advantages of promoting from within include good public relations,
morale building, encouragement of ambitious employees and
availability of information on existing employee performance, cost
savings,internalcandidatesknowledgeoftheorganization,andthe
opportunitytodevelopmidandtoplevelmanagers.
Disadvantages include possible inferiority of internal candidates,
infightingandmoraleproblems,andpotentialinbreeding.

B. Employee referrals/recommendations: Current employees can be asked to

recommendrecruits.
Advantages include the employees motivation to make a good
recommendationandtheavailabilityofaccuratejobinformationfor
the recruit. Employee referrals tend to be more acceptable to
applicants,tobemorelikelytoacceptanoffer,andtohaveahigher
survivalrate.
Disadvantagesincludethepossibilityoffriendshipbeingconfusedwithjob
performance, the potential for nepotism, and the potential for
adverseimpact.

TheExternalSearches

A. Advertisements:Mustdecidetype&locationofad,dependingonjob;
decide whether to focus on job (job description) or on applicant (job
specification).Blindboxadsdontidentifytheorganization.

B. Employmentagencies

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

14

i. State Public Employment Services (Employment Exchanges or

ExServicemen Registry) traditionally have focused on helping
unemployedindividualswithlowerskilllevelstofindjobs.

ii. Private Employment Services (Placement Consultants) may

provide more comprehensive services. Fee may be paid by the
employer,employeeorboth.

iii. Management consulting, Executive Search or HeadHunter firms

specialize in executive placement and hardtofill positions. They
chargeemployersupto30%ofthefirstyearsalary,havenationwide
contacts,anddothoroughinvestigationsofcandidates
D. Colleges, Universities and Institutions may provide entrylevel or experienced
workers through their campus placement services. Campus placements,
accomplished by having recruiters visit campus, may cost the recruiter, for each
selectedcandidateorinsomeotherform.

E. ProfessionalOrganizations:Publishrostersofvacancies,placementservicesat
meetings,andmaycontrolthesupplyofprospectiveapplicants.

F. CyberspaceRecruiting:NearlyhalfofallmajorU.S.companies,andmanyIndian
companiesusetheInternettorecruitforjobsatalllevels.
G. Unsolicitedapplicants(WalkIns):Mayprovideastockpileofpotentialemployees
iftherearenocurrentopenings.

IV.Recruitmentalternatives

Temporary help services help organizations meet shortterm fluctuations in HRM

needs.Olderworkerscanalsoprovidehighqualitytemporaryhelp.
1.
Employee leasing. Trained workers are employed by a contract company, which
providesthemtoemployerswhenneededforaflatfee.

Independent contractors do specific work either on or off the companys premises.

Costsofregularemployees(i.e.taxes&benefitscosts)arenotincurred.

RecruitmentendsandSelectionbeginsoncewehavelocatedthetargetednumberof
diverse,qualifiedapplicants.

V.
SelectionProcess.

The purpose of each step in the selection process is to predict who will be a successful
employee. Successful employees meet the requirements and are a good fit with the
Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

15

company.TheobjectiveoftheselectionprocessistofindaPersonJobOrganization
(PJO)fit.

TheSelectionProcessfollows
A. Initialscreening:

i..Screeningofinquiries:Makesureapplicantsmeetminimalrequirementsinjob
specification.
ii.Screeninginterviews:Clarifythejobdescriptionandsalaryrangeforapplicants.
B. CompletionoftheApplicationform.

i.
Obtain a jobperformancerelated synopsis of applicants
experiencesandskills.
ii.
Testwhetherapplicantscanfollowdirections.
iii.
Obtainsignaturesattestingtotruthfulnessandgivingpermissionto
checkreferences.

C. Employmenttests

i.
Mayincludeintelligence,aptitude,abilityandinteresttests.

D. TheComprehensiveInterview

i.
Usedtoassessmotivation,abilitytoworkunderpressure,abilityto
fitinandotherattributesnoteasilyassessedbyapplicationortests.
ii.
Questionsandtopicsshouldbejobrelated.

E. Backgroundinvestigation

i.
Includes contacting former employers, other references, verifying
educationalaccomplishmentsandlegalstatus,andcriminalrecords.

F. ConditionalJobOffer:

i.
Implies that if everything checks out okay (medical, physical,
substanceabusetest),theofferwillbepermanent.

G. Physical/medicalExamination

i.
Physicalexamsmustbetiedtojobrequirements.
ii.
Informationmaybeusedtoevaluatefutureinsuranceclaims.
iii.
Drugtestsmaybeusedtodisqualifyapplicants.

H. JobOffer

i. Hiringmanagershouldmakefinaldecision.
Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
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16

ii. HRdept.playsadministrativerole
iii. Finalistswhoarenothiredneedtobenotified.

Applicant must also make a decision to accept or reject a job offer, based on perceived
compatibilityofjobwithpersonalityandgoals.Companyalsomustconsiderhowrejected
candidatesaretreated.

VI.
TheComprehensiveApproach:

Inacomprehensiveselectionapproach,allapplicantsareputthroughevery
stepoftheprocess,andthefinaldecisionisbasedonresultsfromallstages.A
discrete method eliminates individuals who receive low evaluations at one
step.

The comprehensive approach is more costly and may build false hopes, but
helpsmanagersmakethe bestdecisionsfor jobswherestrengthsinonearea
maycompensateforweaknessesinanother.

VII.
Key Elements for Successful Predictors: The success of the selection method
willdependon,

Reliability: The ability of the selection tool to measure an attribute

consistently.

Validity:Indicateshowwellaselectiontoolpredictsjobperformance.There
areseveralwaystoassessvalidity:
1.
Content validity: The degree to which to content of a test
representsthecontentofthejob.
2.
Construct validity: The degree to which a test measures a
particulartraitrelatedtosuccessfulperformanceonthejob.
3.
Criterionrelatedvalidity:Thedegreetowhichaselectiondevice
accurately predicts a relevant job performance criterion. May be
assessedtwoways:
a.
Predictive validity is determined by correlating selection
testscoresofapplicantswiththeirfuturejobperformance.
b.
Concurrent validity is determined by correlating the test
scores of current employees with measures of their job
performance.
4.
Cut scores on a selection device can be determined by validity
studies; applicants scoring below the cut score are predicted to be
unsuccessfulonthejobandare,therefore,rejected.

The Validity Analysis: Correlation coefficients (validity coefficients)

summarize the statistical relationship between an individuals test score
andhis/herjobperformance.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

17

 Cut scores and their impact on hiring: By graphing test scores vs

performance ratings, we can see the effects of various cut scores on the
successofahiringprocedurewithaparticularvalidity.

Validitygeneralization.Thisisastatisticalprocedure,whichdetermines
thevalidityofaselectiontestforscreeningapplicantsforavarietyofjobs.
Information on validity in some settings is used to estimate validity for
otherjobsettings.

VIII. SelectionfromanInternationalPerspective

Selectionforinternationalassignmentsincludesfactorssuchasinterestin
workingoverseas,abilitytorelatetodifferentcultures,andsupportiveness
ofthecandidatesfamily(familysituationfactor").

Women executives have done well abroad in Asia and Latin America,
despitepastreluctancetoassignthemtothesecountries.
Finally,despitealltheeffortsoftheorganizationonemustkeepinmindthatthefinal
decisiontoacceptorrejecttheofferiswiththeCandidate

Review:

"DualObjectives"ofRecruitment

The two goals of recruiting are to generate a large pool of applicants from which to
choose while simultaneously providingenough information for individuals to selfselect
outoftheprocess.

FactorsthatinfluenceRecruiting

FactorsthatconstrainHumanResourcesManagementindeterminingrecruitingsources
includeimageoftheorganization,attractivenessandnatureofthejob,salaryandother
benefits, internal policies, career avenues and mobility options, government
requirements,therecruitingbudgetandeventheplaceofposting.

Advantages and Disadvantages of recruiting through Internal search,

EmployeeReferralsandCasualorUnsolicitedapplicants

Advantagesofaninternalsearcharethatthepersonalreadyknowsthecultureandthe
organization. Fit is more onesided in this case. If the candidate is selected, he or she
probably will accept the job. Internal applicants have already cleared background
investigations, and other external hurdles, so the recruiting process is a simpler one.
Disadvantagesofaninternalsearcharethatthepoolwillberestrictedtoattitudes,skills
andabilitiesalreadyintheorganization.
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18


Employee referrals have several advantages. The candidate probably already has a
realistic sense of the organization from the employee. Therefore, if the candidate is
selected,heorsheprobablywillacceptthejob.Theemployeecanserveasareference,
thus somewhat potentially simplifying security and background investigation measures.
Disadvantagesaretiedtothenatureoftheemployeewhorecommendedtheapplicant.If
thatemployeeisnotagoodemployee,chancesarethatheorshehasnotrecruitedagood
employee. The applicant pool is restricted to acquaintances of current workers. The
limitationisnotassevereasaninternalsearch,butitissimilarinkind.

The advantage of casual or unsolicited applicants is that the labour pool is expanded in
unexpected ways. Also, there is no recruiting expense to the employer. Disadvantages
arethatmorepaperworkisinvolved,andtheorganizationmaynothireanextraordinary
potentialemployeeifit isnot awarethatthe person'sskillsandabilitiesareneeded. If
thefirmissystematicinitsrecruitingefforts,thecasualapplicantmaywellbematched.If
thefirmisalsorigid,casualandunsolicitedapplicantsmaybeignored.

Objectivesofselection

The primary purpose of selection activities is to predict which job applicant will be
successfulifhired.Duringtheselectionprocess,candidatesarealsoinformedaboutthe
jobandorganization.Thesemayconflict,becausethebestqualifiedapplicantmaynot
findthejobdesirable.

TheSevenStepsofSelectionprocess

Selection is usually a series of hurdles or steps. Each one must be successfully cleared
beforetheapplicantproceedstothenext.Thediscreteselectionprocessmayincludethe
following seven steps: initial screening interview, completion of the application form,
employmenttests,comprehensiveinterview,backgroundinvestigation,physicalexamina
tion(afterinitialofferismade),andfinalemploymentdecision.

ConceptsofReliabilityandValidityandtheirRelevance

Reliability is confidence that an indicator will measure the same thing every time.
Validity is confidence that what is stated as measured is actually measured. There are
several types of validity important in the selection and recruiting phases of human
resources.Contentvalidityisthedegreetowhichthecontentofthetestrepresentsthe
actual work situation. For example, a typing test has high content validity for a typist.
Constructvalidityreferstothedegreetowhichaparticulartraitisrelatedtosuccessful
jobperformance.Forinstance,honestywouldbeimportantforabankteller.Criterion
relatedvalidityisthedegreetowhichaparticularselectiondeviceaccuratelypredictsthe
importantelementsofwork.

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reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

19

Humanresourcesprofessionalsareconcernedwithvaliditybecause,legally,employment
tests must be shown to be relevant to the job for which a person is hired, as are other
selectioncriteria.

"Shouldanorganizationfollowapromotefromwithinpolicy?"

Promotion from within encourages current employees to do well in their present jobs
withthehopeofrewardintermsofadvancementwithinthefirm.Thisprospectbuilds
morale; helps define purpose and meaning at work. Corporate values and culture are
moredefined andupheldin promotefromwithinorganizations.Aslongasthefirmis
developingtheskillsandabilitiesitneeds,thisarrangementisadesirableone.

But, organizations who only promote from within are getting new ideas and new blood
onlyattheentrylevel,thelowestlevelsoftheorganization.Stagnationandcomplacency
can result. If innovation, adaptability to external circumstances are desirable, then
promotefromwithinisnotgood.

"The use of leased and temporary employees in an organization will only

leadtoa decreasein employeemorale.Theseemployeescomein,dotheir
job,thenleaveituptothe'fulltimers'tohandlethedetails."

Temporaryandleasedemployeesdonothaveloyaltytotheorganization,anddoleaveto
goelsewhere.Therefore,theymaynotfixproblemsaslovinglyasanemployeewhohas
to live with the solution. Also, temporary and leased employees do not have the
experienceorculturalsensitisationtoknowtheprobableapproachestosituationsthatan
insiderwouldhave.Iftheyleaveamess,moraleforsurvivorsmayindeedbelow.The
judgment of management that would trust such responsibility to temps could well be
questioned.Onealternativeistotransferfulltimeemployeesfromotherjobswithinthe
firmtomeetextraordinaryneedswhentheyarise.

However, temporary and leased employees are valuable to the firm for many reasons.
They can be morale builders to other employees by doing jobs that no fulltime person
wantstodo,orfindstoostressfultodo.Theycantakeoverseasonaloverloadsandhelp
fulltime employees do their jobs. They can be used to aid in technology transitions or
conversions, bringing needed skills with them while fulltime staff learn new skills.
Temporaryemploymentalsoaffordsthefirmachancetoevaluatenewemployeesbefore
permanenthiringarrangementsaremadewiththem.Thus,newfulltimeemployeesare
better fits, and this too is a morale builder. It is the responsibility of management and
HRM in terms of job design to make sure that temporary employees are not placed in
positions that will encourage someone to walk away from a mess for fulltimers to
handle.

Notes:
Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

20

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

21

INDUCTION,ORIENTATIONANDSOCILAIZATION

I.

II.

Introduction
Socialization, training and development are all used to ensure that employees
understandwhatisexpectedandcanbeproductiveontheirjobs.

Ideally, employees will understand and accept the behaviours desired by the
organization, and will be able to attain their own goals by exhibiting these
behaviours.
TheOutsiderInsiderPassage

A. Socialization

i.
Aprocessofadaptationtoanewworkrole.
ii.
Adjustmentsmustbemadewheneverindividualschangejobs;the
mostprofoundadjustmentoccurswhenanindividualfirstentersan
organization.

B.TheassumptionsofEmployeeSocialization

i.
Socialization influences employee performance, by providing
informationonhowtodothejobandensuringorganizationalfit.
ii.
Socialization increases organizational stability, since it promotes
consistencyofphilosophyandobjectives.
iii.
New members suffer from anxiety, which motivates them to learn,
butwhichrequiresspecialattentiontoputthematease.
iv.
Socialization does not occur in a vacuum. It is influenced by subtle
and less subtle statements and behaviours exhibited by colleagues,
management,employees,clientsandothersoveraperiodoftime.
v.
Thewayinwhichindividualsadjusttonewsituationsisremarkably
similar.Allnewemployeesgothroughasettlinginperiod.

C.TheSocializationProcess

i.
PreArrival stage: Individuals arrive with values, attitudes and
expectations,whichtheyhavedeveloped,frompreviousexperience
andtheselectionprocess.
ii.
EncounterStage:Individualsdiscoverhowwelltheirexpectations
matchrealitieswithintheorganization.
iii.
Metamorphosis stage: Individuals have adapted to the
organization,feelacceptedandknowwhatisexpectedofthem.

III.ThePurposeofNewEmployeeOrientation:

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reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

22

Orientation may be done by the supervisor, the HRM staff or some

combination. It may be formal or informal, depending on the size of the
organization.

A. LearningtheOrganizationsCulture

i.
Cultureincludeslongstanding,oftenunwrittenrulesaboutwhatis
appropriatebehaviour.
ii.
Socializedemployeesknowhowthingsaredone,whatmatters,and
whichbehavioursandperspectivesareacceptable.

B. TheCEOsRoleinOrientation

i.
Since the mid1980s, it has become more common for toplevel
managerstobevisibleduringthenewemployeeorientationprocess.

ii.
CEOscan
a.
Provideavisionforthecompany.
b.
Introducecompanyculturewhatmatters.
c.
Conveythatthecompanycaresaboutemployees.
d.
Allay some new employee anxieties and help them to feel
goodabouttheirjobchoice.

C. HRMsRoleinOrientation

i.
CoordinatingRole:HRMinstructsnewemployeeswhentoreport;
Providesinformationaboutbenefitschoices.
ii.
ParticipantRole:HRMoffersitsassistanceforfutureemployee
needs(careerguidance,etc.).

Review:

BenefitsofSocializationfortheOrganization

Goodsocializationaddscontinuityandstabilitytoanorganization.Communicationis
facilitated,asmemberssharevisionsandvalues.Goalsareeasiertosetwithashared
senseofpurposefortheorganization.Goalsareeasiertoattainwhenworkersagree
thatthebusinessinwhichtheyareengagedisworthdoing.

BenefitsofSocializationfortheNewEmployee

Organizationalentryiseased,sothatnewemployeesdonotmakeasmanymistakes.
Whennewemployeesknowwhatisexpectedofthem,theyhavebetterorganizational
performance and less frustration and uncertainty. Turnover rates are lower for
organizationsthatconductagoodorientationprogramfornewemployees.
Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
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23

SocializationProgramforEmployeeswhoareInnovativeandIndividualistic

Notionsofindividualityandcreativityareimportant.Theideathatthesocialization
shouldbeconsistentwiththedesiredoutcomesisimportant.Theprogramshouldnot
beaformal.

Somepossibilitiesare,

Showthenewemployeethedesk,givethemacomputerandanumbertocallifheor
shehasquestions.

Schedule an informal discussion session with coworkers to talk about their current
projects,orcurrentproblems,orfutureplans,orsomesuch.

Schedule meetings with clients or users that focus on problems or solutions or

opportunities.

Exhibitwhatotheremployeeshaveaccomplishedpatents,newideas,newprocesses,
whateverisdeemeddesirable.

Letthenewemployeespendthedaywithaninnovativeemployeewhohassimilar
interests.

Ifschedulesorcheckpointsarediscussed,leavegoalsopenendedandflexible.

Socialization Program, if Employees are totally loyal and committed to the

organization'sgoals

Notions of loyalty and commitment are important. The idea that the socialization
should be consistent with the desired outcomes is important. Rewards for desired
behavioursandpenaltiesforundesirablebehavioursshouldbeincluded.

Somepossibilitiesare,

Takethenewemployeetoarecognitiondinnerforlongtermemployees

Explainrewardsystemstothenewemployeethatstressloyaltyandcommitment

Gossipabout"mavericks"whoofcoursearenolongerintheorganization,whodid
thingsthewrongway

Introducehappylongtermemployeestothenewhire
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24

Letthenewemployeegotolunchwithlongterm,committed,happyemployees.
RoleofHRMandCEOinOrientation.

Each function in HRM has a specific role in orientation. Explain how the promotion
fromwithinprocessworksandusuallycoordinatestherestoftheorientationprocess.
TrainingandDevelopmenttalksaboutdevelopmentprogramsofferedandwhatthat
means to the employee. Compensation and Benefits has forms completed and
discusses salary and benefit offerings, and details of the compensation program.
Employee Relations discusses the company's communications programs, health and
safetyissues,andemployeerecognitionprograms.
TheCEO'sroleinorientationistowelcomethenewemployees,reaffirmtheirchoice
of joining the company, and discuss the organization's goals and objectives while
conveyinginformationabouttheorganization'sculture.

IsProperSelectionaSubstituteforSocialization?
Thefacetioussolutiontoeveryhumanresourceproblemishiringtherightpersonin
thefirstplace.However,thatisnoteasytodo.Ifanindividualhasthesamevalues
and respectsthesame norms, andisfamiliarwith therolesusedinanorganization,
thenlittlesocializationisnecessary.Thatindividualhasalreadylearnedandaccepted
the "Do's" and "Don'ts" of the organization. Little adjustment remains to be made.
Thistypeofsituationmaybepossiblewhenchildrenofcompanyofficersarehired,or
when new employees come from sister organizations. However, even the most
compatibleindividualneedstolearnthepeculiaritiesofthisorganization.Thereare
boundtobeissuesatonetimeoranotherwheretheindividualandtheorganization
arenotsimpatico.Knowingwhichhumanresourceprofessionalareatogotoatthat
time is helpful. If a person is compatible when hired, at some time in the future,
organizational growth and personal growth may diverge. Socialization includes
gettingtoknow thecompany,butalsotheindividuals, thegroups,andthenatureof
thetask.

.
Selection,SocializationandTraining:Thelinkage

There can be a reciprocal relationship between selection and training. If both

functionsareawareoftheneedsoftheorganization,theycanworktogethertogetthe
right people. Selection has to hire people who are ready to perform. If training can
providecertainskillsorsetsofskillstonewworkers,theselectionfunctionhasmore
options open to it and can hire avariety ofworkers who canbe"fine tuned" during
training.Ifthetwofunctionsdonotinteractwell,selectionisleftonitsown.Training
also has no early warning from selection areas, so it has less time to respond to
demandsfortraining.

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25

TrainingandSocializationcanhaveaharmoniousrelationshipinanorganization.If
employeesaresocializedintothinkingthattrainingisanecessary,vibrantpartofthe
organization,apiecethathelpsthemgrowandchangewiththecompany,thenthejob
oftrainersisaneasierandmorepleasantone.Iftraininghaspartialresponsibilityfor
an orientation program, socialization is facilitated. Training that encourages
employeegrowthandthatiscompetencybased,helpstocreatepositivecultureinan
organization. If employees are socialized into regarding training as a nuisance or
wasteoftimeorpunitive,theywillattendtrainingfunctionsreluctantly,ifatall.They
will not see training as an avenue of personal or professional growth. Such a
relationship makes it very difficult for training to be responsive to organizational
needs. If training functions are not integrated into the rest of the human resource
management areas, it will be irrelevant. Poor training, inadequate training,
superfluous training can help socialize employees in negative ways to disregard
their supervisors, to have disdain for the organization, to have a sense that the
companyneitherknowsnorcaresabouttheirwellbeing.

Notes:

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reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

26

PERFORMANCEEVALUATIONANDPERFORMANACEMANAGEMENT

I.

Introduction

The Performance Appraisal process is a formal process by which each

employees performance is evaluated. Whereas Performance
Management process is not only that evaluates employees past
performance, but also documents the performance pattern, provides
adequate scope for developing employees potentials, and focuses on
continuous performance improvement through appropriately tailored
reinforcementmechanisms.

ThePerformanceappraisalprocessshouldbebasedonjobanalysis,and
includes decisions about who should evaluate performance, what format
shouldbeusedandhowtheresultsshouldbeutilized.Theprocessshould
bedesignedtostrengthentheeffortperformancelinkage.

II.

TheLinkagetoMotivation:

III.

Employeesaremotivatedbythelinkagestheyperceivebetweentheireffortsand
performance,andbetweentheirperformanceandrewards.

An appraisal system helps the organization communicate its expectations for

performance, and the connections between performance and rewards to
employees.

Performanceappraisalcanincreaseemployeeconfidencewhenemployeesreceive
feedbackthattheireffortsarepayingoff.

PerformanceManagementSystems
A.

Thepurposes
i.
Feedbackletemployeesknowhowwelltheyhavedone.
ii.
Developmentworkwithemployeestoimprove.
iii.
Documentationtomeetlegalrequirements.

B. Difficultiesinperformancemanagementsystems

i.
Open discussions on performance may elicit emotions and may
generateconflictswhensubordinatesandsupervisorsdonotagree.
ii.
The formal organizational process may encourage the wrong
behaviours; e.g. managers focusing on the negative to make
numbersbalance.

C.
EffectivelyEvaluatingemployees

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reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

27

i.
ii.
iii.
iv.
v.
vi.
vii.
viii.
ix.

IV.

PerformanceAppraisalsandObjectivity
i.
ii.

V.

Preparefor,andscheduletheappraisalinadvance.Includereview
ofjobdescriptions,goalsandperformancedata.
Create a supportive environment to put employees at ease.
Appraisalscanelicitemotions.
Describethepurposeoftheappraisaltoemployees.Forexample,
will the appraisal have implications for pay raises, promotions or
otherdecisions?
Involvetheemployeeintheappraisaldiscussion,includingaself
evaluation: Ask employees to prepare and be receptive to their
perspective.
Focus discussion on work behaviours, not on the employees.
Describe specific behaviours you have observed, rather than
evaluateemployeecharacteristics.
Support your evaluation with specific examples. Jobrelated
behaviouralobservationsanddiscussionsfocusingontheeffectsof
anemployeesbehaviouraremostuseful.
Give both positive and negative feedback. Good work should be
reinforced.Suggestionsforimprovementshouldbeclear.
Ensure employees understand what was discussed in the
appraisal.Askemployeestosummarizewhathasbeendiscussed.
Generate a development plan. Write down what should be done,
bywhen,andwhatyouwilldotoassist.

HRMpracticesmustbebiasfree,objectiveandjobrelated.
Validperformanceappraisalsareconductedatestablishedintervalsandare
donebytrainedappraisers.

TheAppraisalProcess
A.

Establishmentofperformancestandards
i.
Derivedfromcompanysstrategy.
ii.
Basedonjobdescription.

B.

C.

Communicationofexpectationstoemployee.

D.

E.

Measurementofperformanceusinginformationfrom
i.
Personalobservation
ii.
Statisticalreports
iii.
Oralreports
iv.
Writtenreports
Comparisonofactualperformancewithstandards.
Discussionofappraisalwithemployee.

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28

VI.

F.
Initiationofcorrectiveactionwherenecessary.

i.
Immediateactiondealswithsymptoms.

ii.
Basiccorrectiveactiondealswithcauses.

AppraisalMethods
A.

B.

C.

VII.

Absolutestandards:Inthismethod,employeesarenotcomparedtoeach
other
i.
Essayappraisal: Appraiser writes narrative describing
employeeperformance&suggestions.
ii.
Critical incident appraisal: Based on specific behavioural
anecdotesillustratingeffectiveorineffectivejobperformance.
iii.
Checklistappraisal:Appraiserchecksoffbehavioursthatapplyto
theemployee.
iv.
Adjective rating scale appraisal: Appraiser rates employee on a
numberofjobrelatedfactors.
v.
Forcedchoice appraisal: In order to reduce bias, appraisers
choose statements which best describe the employee from sets of
statements,whichappeartobeequallyfavorable.
vi.
Behaviourally Anchored Rating Scales (BARS): Appraiser rates
employees on factors which are defined by behavioral descriptions
illustratingvariouspointsalongeachratingscale.
Relative standards: In this method employees are compared to each
other.
i.
Group order ranking: Employees are placed in a classification
reflectingtheirrelativeperformance,suchastoponfifth.
ii.
Individualranking:Employeesarerankedfromhighesttolowest.
iii.
Paired comparison: Each individual is compared to every other;
finalrankingisbasedonnumberoftimestheindividualispreferred
memberinapair.
ObjectivesBasedMethod
i.
Employees can be evaluated on how well they achieve specific
objectives.
ii.
A formal approach to using objectives is Management by
Objectives (MBO). It consists of four steps: goal setting, action
planning,selfcontrolandperiodicreviews.

FactorsThatCanDistortAppraisals
A.

Leniencyerror
i.
Eachevaluatorhashis/herownvaluesystem.
ii.
Someevaluatehigh(positiveleniency)andothers,low.

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29

B.

C.
D.
E.

F.

G.

H.

Haloerror:Thetendencytoletanassessmentofanindividualononetrait
influenceevaluationonother,differenttraits.
Similarityerror:Occurswhenanevaluatorratesothersinthesameway
thattheevaluatorperceiveshimorherself.
Lowappraisermotivation:Evaluatorsmaynotfeelthatitisworthwhile
spending the time to do a thorough evaluation, or may be reluctant to be
accurateifimportantrewardsfortheemployeedependontheresults.
Centraltendency:Thereluctancetousetheextremesofaratingscaleand
toadequatelydistinguishamongemployeesbeingrated.
Inflationarypressures:Pressuresforequalityandfearofretributionfor
lowratingsleadstolessdifferentiationamongratedemployees.
Inappropriate substitutes for performance: Effort, enthusiasm,
appearance,etc.aremoreappropriateforsomejobsthanothers.
AttributionTheory
i.
Biasesoftenresultwhenwedecidewhethersomeonesperformance
isduetointernalfactorstheycancontrolorexternalfactorswhich
theycannot;e.g.ifpoorperformanceisattributedtointernalcontrol,
the judgment is harsher than when it is attributed to external
control.

ii.
Impression management refers to efforts by employees to obtain
higherratingsbyportrayinganimagedesiredbytheirsupervisors.

VIII.CreatingMoreEffectivePerformanceManagementSystems

A.
Usebehaviourbasedmeasures:Measuresbasedonspecificdescriptions
of behaviour are more jobrelated and elicit more interrater agreement
thantraits,suchasloyaltyorfriendliness.

B.
Combineabsoluteandrelativestandards:Absolutestandardstendtobe
positivelylenient;relativestandardssufferwhenthereislittlevariability.

C.
Provide ongoing feedback: Expectations and disappointments should be
sharedwithemployeesonadaytodaybasis.

D.
Have multiple raters: Increasing the number leads to more reliable and
validratings.
i.
Use peer evaluations: Coworkers offer constructive and specific
evaluations; upward appraisals allow employees to give their
managersfeedback.
ii.
360Degreeappraisals:Supervisors,peers,employees,customers
andotherswithrelevantinformationevaluatetheemployee.
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30

IX.

E. RateSelectively

i.
Appraisers only evaluate in those areas about which they have
sufficientknowledge.
ii.
Moreeffectiveratersareaskedtodotheappraisals.

F.
Train appraisers: Untrained appraisers can demoralize employees and
increaselegalliabilities.

InternationalPerformanceAppraisal
A.

Whoperformstheevaluation?
i.
ii.
iii.

B.

Differentculturalperspectivesbetweentheparentandlocalcountry
maymakeevaluationdifficult.
Evaluationformsmaynotbetranslatedaccurately.
Quantitative measures may be misleading because regulations,
accountingpractices,andchancesforsuccessdifferacrosscountries.

Whichevaluationformatwillbeused?
i.
ii.
iii.

Maymakesensetousedifferentformsforparentcountrynationals
andhostcountrynationals.
Performancecriteriaforaparticularpositionshouldbemodifiedto
fittheoverseaspositionandsite.
Includeacurrentexpatriatesinsightsaspartoftheevaluation.

Review:

PurposesofPerformanceManagement

The purposes of performance management systems are feedback, development,

and documentation. Performance appraisals are designed to support the em
ployees,theappraisers,andtheorganization.

AppraisalProcess:ADescription

Thesixstepappraisalprocessisasfollows:

a.
Establishperformancestandardswithemployees.
b.
Managerandemployeesetmeasurablegoals.
c.
Measureactualperformance.
d.
Compareactualperformancewithstandards.
e.
Discusstheappraisalwiththeemployee.
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reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

31

f.

Ifnecessary,initiatecorrectiveaction.
Advantages and Disadvantages of Absolute Standards and Relative
Standards

Absolute standards refer to a method in performance management systems

whereby employees are measured against companyset performance
requirements. Absolute standard evaluation methods involve the essay
appraisal, the critical incident approach, the checklist rating, the graphic rating
scale, the forcedchoice inventory, and the behaviourallyanchored rating scale
(BARS).

Relative standards refer to a method in performance management systems

whereby employees' performance is compared to that of other employees.
Relative standard evaluation methods include group order ranking, individual
ranking,andpairedcomparisons.

The advantage of absolute standards is that employees can be assessed as

adequate against the external standard, but there is no indication of how
employeescomparetoeachother.Withrelativestandards,theoppositeistrue.
The advantage is that employees are compared to each other, but there is no
externalyardstick.

BARS:IsBARSbetterthanTraitOrientedMeasures?

A Behaviourally Anchored Rating Scale (BARS) is an absolute assessment

technique. Critical incidents are identified, and a range of performance
possibilities (from poor to good) is described for each dimension. This
behaviouralbasedmeasureispreferabletoatraitorientedmeasurebecauseit
capturesactualobservable,jobperformanceratherthanatraitthatmayormay
notinfluenceperformance.

MBO

ManagementbyObjectives(MBO)isanapproachtoappraisalthatmakesuseof
objectives. Organizational objectives are converted into individual objects in a
fourstep process: goal setting, actual planning, selfcontrol, and periodic
reviews.

FactorsthatdistortPerformanceAppraisals

Performance appraisal might be distorted for a number of reasons, such as

leniency error, halo error, similarity error, central tendency, low appraiser
motivation, inflationary pressures, and inappropriate substitutes for
performance.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

32

 "Performance Appraisal is a twoway street. Supervisors evaluate

their subordinates, and subordinates should evaluate their
supervisors."

Thesubordinateisinauniquepositiontoevaluatetheworkofasupervisor.To
the extent that the supervisor's work is the direction of subordinates, those
workersarethe'experts'onthatsubject.However,thesupervisor'sjobislarger
thantheportionofitthatthesubordinatesees.Therefore,thesubordinatehas
noknowledgeofandnovalidopinionabout,therestofthesupervisor'sjob.

"The higher the position an employee occupies in an organization,

theeasieritistoappraisehisorherperformanceobjectively."

Externally reported figures are usually available from the business unit on up.
Performance figures can be tied to profit and loss, and overall business unit
success. But, the numbers do not always tell the whole story. Turnover, and
employeeproblemsmaynotshowupinthenumbers.Also,someproblemsmay
notappearintheshortterm.Further,externalinfluencesmayhelpdetermine
thenumbers,beyondtheperformanceoftheemployee.

"Using a Performance Evaluation instrument that is not valid is a

wasteoftime."

Such a process can be more than a waste of time. It can damage trust, loyalty,
commitment and performance for both employees and managers, if individuals
believe that the ratings are unfair or meaningless. However, it depends on how
the evaluation instrumentisused. If ratingsare primarily usedto stimulate an
honest discussion between manager and employee, the quality of the ratings
themselvesisnotasimportantastheusefulnessofthecommunicationsprocess.
Even if ratings are the basis for decisionmaking, no form is perfectly valid but
using multiple raters, trainingraters, and providing behaviourbased guidelines
tohelpratersmakejudgments,canimproveratings.

Notes:

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

33

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

34

TRAININGANDDEVELOPMENT

I. Introduction

Organizationsaredynamic
RateofChangeisfasterthaneverbefore
Changeistoorapid,continuousandstressful
Responsetimefordecisionsgetshorterandshorter
Rapidtechnologicaladvancesleadtofasterobsolescence
Increasing competition and the need for competitive advantages keeps
organizations to facilitate organization wide learning and continuous
improvement
Information explosion had necessitated managers to be sophisticated and
accurateinstrategicbusinessdecisions
Traditional management styles are no longer effective in the new work
places
Newleadershipstylesarethrustonmanagers,asmoreskilledworkforceis
entering the workforce. Need to move from task masters to team
managers
Globalisation had necessitated the managers to be sensitive to cultural
factorsatworkplace

II.WhatisEmployeeTraining?

A.
Definitions

i.
Employee training is a learning experience designed to achieve a
relatively permanent change in an individual that will improve the
abilitytoperformonthejob.
ii.
Employeedevelopmentisfutureorientedtraining,focusingonthe
personalgrowthoftheemployee

III.OrganizationalFactorsInfluencingtheTrainingandDevelopment

i.
SizeoftheOrganization
ii.
OrganizationoftheTrainingDepartment
iii.
OrganizationsCorporateStrategy
iv.
Technologyemployed
v.
ManagementSupportandAttitudetowardstraining
vi.
Financialcomponents(Cost&Benefit)ofTraining
vii.
CapabilityoftheTrainingStaff
viii. TrainingofTrainers
ix.
LegalIssuesinTraining,ifany.

III.TrainingStages/Phases.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

35

Therearefourdistinctbutinterrelatedstagesoftraininganddevelopment.They
are,
NeedAssessmentStage
DesignandObjectiveSettingStage
ImplementationorConductStage
EvaluationandFeedbackStage

A.

DeterminingTrainingNeeds:
i.
ii.
iii.
iv.
v.

B.

Training needs could be broadly categorised as, Performance

discrepancyneedsorAnticipatoryneeds.
Specifictraininggoalsshouldbebasedontheorganizationsstrategy
and a determination of what work needs to be done and the skills
necessarytocompletethework.
Drops in productivity or increased rejects may indicate a need for
moretraining.
Thecostsoftraining,relativetothebenefits,mustbeconsidered.
Understand whether training addresses the trainable deficiency or
thereisaproblemofmotivation

TrainingApproaches
i.

ii.

Onthejobtrainingiswidelyusedandeffectivewhenthedamage
traineescandoisminimal.
a.
Apprenticeship training puts trainees under the guidance
ofamasterworker,typicallyfor25years.
b.
Job Instruction Training (JIT) is systematic approach
consisting of preparing the trainees, presenting the
instruction, having trainees try out the job, and placing
traineesonthejobwithadesignatedresourceperson.

Offthejob training includes a variety of techniques, such as

lectures,films,demonstrationsandsimulationexercises.

a.

IV.

Programmedinstructionis anapproachthatputsmaterial
to be learned into highly organized, logical sequences that
requirethetraineetorespond.
b.
Interactive videodisks allow users to make changes and
selections as they interact with a personal computer, which
includesvideopictures.
c.
Virtual reality systems simulate actual work activities by
sending messages to the brain, thereby allowing individuals
to interact with the simulated environment as if they were
reallythere.
EmployeeDevelopment

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

36

A.
B.

This futureoriented set of activities is predominantly an educational

process.Intodaysworkenvironment,allemployeescanbenefitfromthe
methodspreviouslyusedtodevelopmanagerialpersonnel
Employeedevelopmentmethods
i.
ii.
iii.
iv.
v.
vi.

V.

Jobrotationinvolvesmovingemployeestovariouspositionsinthe
organizationtoexpandtheirskills,knowledgeandabilities.
Assistantto positions allow employees with potential to work
underandbecoachedbysuccessfulmanagers.
Committee assignments provide opportunities for decision
making, learning by watching others, and becoming more familiar
withorganizationalmembersandproblems.
Lecturecoursesandseminarsbenefitfromtodaystechnologyand
areoftenofferedinadistancelearningformat.
Simulationsincludecasestudies,decisiongamesandroleplays.
Outdoor training typically involves major emotional and physical
challenges,whichteachtraineestheimportanceofteamwork.

OrganizationDevelopment
A.

B.

C.

D.

OD efforts support changes that are made in the organizations systems,

technology,processesandpeopleinlinewiththestrategicdirectionofthe
business. In todays business environment, change is described by the
whitewatermetaphorthatreflectstheuncertainanddynamicnatureof
change.

ODMethods

i.
ClimateSurveysaskorganizationalmembersfortheirperceptions
and attitudes. The summarized data are used to identify problems
andclarifyissuessothatcommitmentstoactioncanbemade.
ii.
Team building may include goal setting, development of
interpersonal relationships, clarification of roles and team process
analysistoincreasetrust,openness,andteamfunctioning.
iii
Thirdparty interventions use a facilitator to help different
organizational groups to change the attitudes, stereotypes and
perceptionstheyhaveofeachother.

Theroleofchangeagents
i.
Changeagentsmaybeinternal,traininganddevelopment
employees,orexternalconsultants.
ii.
Theymustunderstandorganizationaldynamics,haveoutstanding
communicationskills,andbeskilledattakingriskstosupport
change.

TheLearningOrganization

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

37


1.
2.

VI.

EvaluatingTrainingandDevelopmentEffectiveness
A.

B.

How do we evaluate training programs? Typically, employee and

manager opinions are used. These opinions, or reactions are not
necessarily valid measures, since they are influenced by things like
difficulty, entertainment value, or personality of the instructor.
Performancebased measures are better indicators of trainings cost
effectiveness.
Performancebasedevaluationmeasures
i.
ii.
iii.

VII.

AsdescribedbyMITProfessorPeterSenge,thistypeoforganization
values continued learning and fosters an environment where open,
trustingrelationshipsresultinorganizationalrevitalization.
Learningorganizationsarecharacterizedby:
a.
Systemsthinking
b.
Personalmastery
c.
Mentalmodels(waysofdoingthings)
d.
Sharedvision
e.
Teamlearning

Posttrainingperformancemethod.Employeesonthejob
performanceisassessedaftertraining.
Preposttrainingperformancemethod.Employeesperformance
is assessed both before and after training, to determine whether a
changehastakenplace.
Preposttrainingperformancewithcontrolgroupmethod.This
sophisticated technique compares the preposttraining results of
the trained group with the job performance at the same points in
time of a control group, which does not undergo instruction. The
approach is used to control for factors other than training, which
mayaffectjobperformanceovertime.

InternationalTrainingandDevelopmentIssues
A.

Training
i.

ii.

Crosscultural training is necessary for expatriate managers and

their families before assignments (to learn language and culture);
during, and after foreign assignments (to adjust to changes back
home).
Crosscultural training is more than language training; it includes
learning about the cultures history, politics, economy, social and
business practices and may involve roleplaying, simulations and
immersionintheculture.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

38

B.

Development.
i.

ii.

Often,organizationsdonotdoagoodjobofplanningforthereturn
ofoverseasmanagers.Thisleadstothemanagersbeingfrustrated
with lack of recognition and opportunity back home and to others
reluctancetotakeoverseasassignments.
Expatriatescanbeassignedadomesticposition,canpreparefora
newoverseasassignment,canretireorbeterminated.

Review:

WhyManagerscouldbesonegativeabouttraining?

One reason for their lack of support may be that they have had previous negative
experiences. Training that is not based on needs assessment and an understanding of
learningprinciplesmaybeawasteoftimeandmoney.Anotherreasonmaybethatthey
feelthreatenedbytheidea.Sometimestrainingneedsassessmentanddiscussionswith
employees during training reveal management deficiencies. Training may make
employeesmoreawareofthesupporttheyneedfrommanagement,intheformofclear
instructions,equipment,andtimetopayattentiontoqualityandcustomerneeds.

Signalsthatwarnamanagerthatemployeetrainingmaybenecessary

Training is needed when incumbents do not have the skills, knowledge or attitudes to
perform necessary behaviours to do the work of the organizations. Such needs are
signalled in various ways. Low job performance or a drop in productivity, high reject
ratesorlargerthanacceptablescrap,allmayindicatetrainingneeds.Otherfactorsthat
maycausepoorperformance,suchaspoorequipmentorbadsupervision,shouldberuled
outbeforetrainingisoffered.

Howtoobtainsupportneededforasuccessfulqualityprogram?

First,thecoordinatorneedstounderstandthemanagersperspectivesandthenatureof
the organizational problems. This is probably best done using an OD approach, which
emphasizestheentireorganizationalsystem.Thecoordinatorneedstostartbytalkingto
the plant manager, and making sure that the executives recognize the need for changes
and are motivated to support change. If they are not, perhaps the coordinator can get
commitment from the plant manager to collect some data on scrap, waste, customer
satisfaction, etc. A discussionof this data and alternative ways to improve productivity
and morale may make the need for quality training clear. Or, perhaps there are other
approachesthatmayworkbesttostart,suchasraisingworkstandards.

WhyEvaluationoftrainingeffectivenessnecessary?
Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

39


Trainingeffectivenessshouldbeevaluatedforseveralreasons.First,trainingcannotbe
improved unless its effectiveness is evaluated. Second, evaluation is a fact of life for
operational divisions of a firm. Evaluation helps give credibility to trainers and the
trainingfunction.Third,communicationswithotherdivisionsareenhancedbyspeakinga
common language of evaluation. Fourth, tracking training effectiveness is useful to use
for longterm planning and strategic organizational development interventions in the
firm.

ImportanceofCulturalTrainingforemployeesonoverseasassignment

Most of the problems in overseas assignments are cultural, not technical, in nature.
Further, expatriates who have good cultural training before departure experience less
difficulty in the overseas assignment and when they return. It is costly to send an
employeeoverseas,andthecompanyloseswhenavaluableemployeemustreturnearly
becausehis/herfamilycannotadjustorwhenafrustratedmanagerleavesthecompany
shortlyafterhis/herreturnfromtheassignment.

Trainingprogramsarefrequentlythefirstcasualtieswhenmanagement
wantstocutcosts.Why?

Costcuttingtargetsnonessentialorextraneousitemsintheshortrun.Trainingoftenfalls
into this category because human resource managers do not evaluate their programs
carefullyenoughtodemonstratevaluetotheorganization.Also,iftrainingisperformed
basedonwhatthetrainingdepartmentcandoorlikestodo,insteadofonwhatskillsand
behaviours the organization needs to have in its employees, training is not part of the
strategic goal setting of the organization. Again, it is an easy target for shortterm
solutions.
When training departments are eliminated in longterm strategic plans, they have not
demonstratedtheirabilitytomeetneedsoftheorganization;theyhavenotbeenintune
withthecompany.

Notes:

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.

40