Human Resource Management

Shah M Saad Husain

Human Resource Management by Shah M Saad Husain

Human Resource Management

Shah M Saad Husain
B Engg, MS Engg, PE, MBA, FICS, FIMM

33 years management experience with government, Pakistani private sector and multinational companies in engineering, petroleum, energy and mineral sectors.
in HR, General Management, Marketing, Project Management, Engineering Operations, Business Development, External Affairs, Corporate Planning, CSR and Customer Relations. with PIDC, Habib Group, British Petroleum, BHP Billiton, Toyota Indus Motor, Pak-Arab Refinery.

22 years teaching experience at IBA, CBM, PIQC, PIM, NIPA, LUMS. Subjects: HRM, Performance & Compensation Management, Marketing Management, Strategic Management, Project Management, Industrial Marketing, Japanese Management, CSR, Customer Ascendancy.
Human Resource Management by Shah M Saad Husain

Human Resource Management Course Contents

The Strategic Role of HRM Job Analysis and Job Design Staffing Employee Development Compensation Employee Relations

Human Resource Management by Shah M Saad Husain

Human Resource Management Course Objectives

Knowledge of HRM Theory, Concepts, Processes and
Practices.

Identifying Sources of Information and using them. Class Interaction, learning from the Marketplace. Practical Application of course, developing
Strategies for Organizations.

HRM

Performance Assessment: Students nTeacher.

Human Resource Management by Shah M Saad Husain

Human Resource Management

Course Requirements

Readings from selected texts, journals Theory, Concepts discussed in Class Student Projects and Reports Real Life Cases Examinations Presentations and Class Evaluations Class Participation, Quizzes, Home Assignments

Human Resource Management by Shah M Saad Husain

Strategic Human Resource Management

Instructions for Students

Bring Course File to each class Read reading materials before class Write notes as slides are explained and discussed Keep track of Course Calendar, Class Timings, Grades, etc., on E-group and with CR Maintain contact with CR and SSH Meet Attendance and Punctuality requirements Discipline is key. Adhere to Class Rules.

Human Resource Management by Shah M Saad Husain

Human Resource Management - Grading

Midterms ( 2 x 20 ) Final Project Report, Presentation Home Assignments, Quizzes All Quizzes are open book

= = = =

40 30 25 5

For an overall A grade in the course:

A in Final Examination A in Project Report Active Class Participation No disciplinary violations

Human Resource Management by Shah M Saad Husain

Human Resource Management - Readings

I. Luis R. Gomez Mejia, David B. Balkin, Robert L. Cardy (2008) : Prentice Hall Managing Human Resources Lloyd L. Byars, Leslie W. Rue (1997) : Irwin McGraw-Hill Human Resource Management Wayne F. Cascio (2005), Tata McGraw-Hill Managing Human Resources

II.

III.

Human Resource Management by Shah M Saad Husain

Human Resource Management

1 The Strategic Role of HRM

Human Resource Management by Shah M Saad Husain

HUMAN RESOURCE MANAGEMENT

Employer/Organizational Objectives Organizational Structure Job Identification, Analysis & Design Job Specification (Before Joining) Job Description (After Joining) Tasks, Activities, Responsibilities, Accountabilities Power (Financial/Administrative) Reporting Structure Manpower Planning, Recruitment, Induction Training & Development

Employee Objectives
Growth in
Family & Self Profession Career Security Social Status Work

JOB (Scope & Depth) Employee Employer Relationship

Employer Objectives
Services Growth in Goods & Services Customer Satisfaction Revenue Generation Profits Return on Equity (ROE) Expansion of Business Corporate Reputation

EMPLOYEE

EMPLOYER
Compensation & Rewards

Performance Management

Performance Evaluation Increments Bonus Incentives Career Development Ultimate Potential

Salary Benefits Facilities and Perks Allowances Professional, Career, Societal Recognition Internal + External (Mkt) Equity

Human Resource Management by Shah M Saad Husain

Human Resource Management by Shah M Saad Husain

Human Resource Management by Shah M Saad Husain

Human Resource Management by Shah M Saad Husain

Introduction to HRM
Human Resources Strategy in a firm is a firms deliberate and planned use of human resources to help it gain a competitive advantage. The HRM strategy of a firm is its grand plan to ensure that it effectively uses its people to accomplish its mission.

Human Resource Management by Shah M Saad Husain

HRM and Corporate Strategic Goals

Human Resource Management is essential to advance a firms strategic goals.

CORPORATE STRATEGIC GOALS
CORPORATE STRATEGY
HR STRATEGY
HR TACTICS
HR PLANS
HR POLICIES, SYSTEMS, SOPs

Linking Corporate Strategic Goals with HRM

HR PRACTICES

Human Resource Management by Shah M Saad Husain

Human Resource Management by Shah M Saad Husain

HRM and the 21st Century

Due to Internet technologies, organizations are undergoing a complete transformation. The 21st century organization must adapt itself to management via the web. Intellectual capital will be critical to success. Advantage of bringing new technologies to the market will be shorter. Technologies will let competitors match them almost immediately.

In such times, it will be critical to attract and retain the best thinkers.
Retaining and attracting the top talent will require more than just paychecks. It will require a culture of empowering people, and a reward system that rewards the best as if they were the owners of the company.

Intellectual capital will be called on from around the globe. A global corporation might be based in the US but does its software programming in Sri Lanka, engineering in Germany, its manufacturing in China, and is linked via the Internet to allow employees to interact and work in real time.

Human Resource Management by Shah M Saad Husain

HRM and the 21st Century Corporation

20th Century Corporation Predicated itself on stability 21st Century Corporation Predicated itself on constant change

Organized around rigid hierarchies

Built on self-sufficiency Organizational chart defined as a shrinking pyramid leading to the CEO

Organized around networks and teams

Built on alliances shifting partnerships and

Organizational chart more likely to be a flat web, intricately woven that links partners, employees, external contractors, suppliers, and customers in various collaborations Constructed on knowledge technological advantages. and

Constructed on bricks and mortar

Human Resource Management by Shah M Saad Husain

Human Resource Management by Shah M Saad Husain

Human Resource Management by Shah M Saad Husain

Outcomes of HRM Practices

HRM practices make an important practical difference in three key organizational outcomes.
1.

Productivity Quality of Work Life Profit : Total Revenue minus the Total Cost

2. 3.

Human Resource Management by Shah M Saad Husain

Outcomes of HRM Practices: 1. Productivity

A measure of the output of goods and services relative to the input of labor, capital, and equipment.
Higher productivity Leads to higher wages without boosting inflation. Is not working harder, it is working smarter. Is about doing more with fewer people, less money, less time and space, and fewer resources.

Human Resource Management by Shah M Saad Husain

MORE PRODUCTIVE ORGANIZATIONS GET MORE GOODS AND SERVICES FROM A GIVEN AMOUNT OF LABOR, CAPITAL, EQUIPMENT.

Human Resource Management by Shah M Saad Husain

Outcomes of HRM Practices:

1. Productivity Improvement

Rebuild employee loyalty.

Establish a clear link between rewards and production. Say no to Quick Fix approach. Emphasize on Continuous Improvement.

Human Resource Management by Shah M Saad Husain

Outcomes of HRM Practices:

2. Quality of Work Life

Two ways of looking at Quality of Work Life (QWL)

Organizational Conditions and Practices such as promotion from within, democratic supervision, participative management, employee involvement, safe working conditions, mutual trust, team work. Employees Perceptions that they are respected, relatively well satisfied, and able to grow and develop as human beings and professionals.

Human Resource Management by Shah M Saad Husain

Human Resource Management by Shah M Saad Husain

Outcomes of HRM Practices: 3. Profit

Management Systems that produce profits through people share the following dimensions:
1. 2. 3. 4. 5. 6. 7. 8. 9.

Employment Security. Selective Hiring. Self-managed teams and decentralization. High Compensation contingent on organizational performance. Extensive Training, Development and Professional grooming. Reduced differences in status. Respect for competence and performance. Sharing of information, effective communication systems. Employee Care and Satisfaction. Trust.

Human Resource Management by Shah M Saad Husain

Outcomes of HRM Practices:

4. Roles of HR Professionals Today
The greatness of an Organisation is due to the Greatness of its People, Eiji Toyoda
1.

Strategic Partners: work with multiple stakeholders to achieve business plans. Innovators: create an environment that supports continuous learning and improvement. Collaborators: create win-win situations with internal and external stakeholders. Change facilitators: anticipate the need for change, think, conceptualize, articulate, execute and energize organization to bring change.

2.

3.

4.

Human Resource Management by Shah M Saad Husain

HRs Strategic Role

Successful firms align their HR strategies and tactics with:

1. 2. 3. 4.

Environmental Opportunities and Threats. Business Strategies. Organizational Unique Characteristics. Organizations Competence.

Human Resource Management by Shah M Saad Husain

Planning and Implementing Strategic HR

Strategic HR Planning involves:

1. 2. 3. 4.

Formulation of HR strategies Designing Programs and Tactics Execution Monitoring Results

Human Resource Management by Shah M Saad Husain

The Benefits of HR Planning

1.

Encouragement of proactive rather than reactive behavior Explicit communication of Company Goals Stimulation of critical thinking and ongoing examination of assumptions Identification of gaps between Current Situation and Future Vision Encouragement of Line Managers Participation Identification of HR constraints and opportunities Teamwork and creation of common bonds

2.

3.

4.

5.

6.

7.

Human Resource Management by Shah M Saad Husain

The Challenges of Strategic HR Planning

1.

Maintaining a competitive advantage Reinforcing overall business strategy Avoiding excessive concentration on day-to-day problems Developing HR strategies suited to unique organizational features Coping with the environment Securing management commitment Translating the strategic plan into action Combining intended and emergent strategies Accommodating change

2.

3.

4.

5.

6.

7.

8.

9.

Human Resource Management by Shah M Saad Husain

Selecting HR Strategies to Increase Firms Performances

HR Strategys effect on a firms performance depends on how well it fits with other factors Fit refers to the consistency and compatibility between HR strategies and other important aspects of the organization

Human Resource Management by Shah M Saad Husain

Fit with Organization Strategies

Corporate Strategy is referred to as the mix of businesses a corporation decides to hold and the flow of resources among those businesses. e.g., PARCO Business Unit Strategies are those that are formulated and implemented by a firm that is relatively autonomous, even if it is part of a larger corporation. eg. PAPCO

Human Resource Management by Shah M Saad Husain

Effective HR Strategy Formulation and Implementation

Human Resource Management by Shah M Saad Husain

Human Resource Management by Shah M Saad Husain

Selected HR Strategies That Fit Miles and Snows Two Major Types of Business Strategies

Human Resource Management by Shah M Saad Husain

Fit with the Environment

HR strategies should help the organization better exploit environmental opportunities or cope with the unique environmental forces that affect it The relevant environment can be measured in terms of four dimensions:
1.

Degree of uncertainty: how much accurate information is available to make appropriate business decisions Volatility: how often does the environment change Magnitude of change: how drastic the changes are Complexity: how many different elements in the environment affect the firm either individually or together

2.

3.

4.

Human Resource Management by Shah M Saad Husain

Selected HR Strategies for Firms Low and High on Different Environmental Characteristics

Human Resource Management by Shah M Saad Husain

Fit with Organizational Characteristics

1.

The production process for converting inputs into outputs

Routine production process benefits from HR strategies that emphasize control

example: Specific job description and job specific trainings

Firms with non-routine production processes such as advertising firms, custom printers, and biotechnology companies, benefit from flexible HR strategies that support organizational adaptability, quick response to change and creative decision making
example: Broad job classes, loose work planning, and generic training

Human Resource Management by Shah M Saad Husain

Fit with Organizational Characteristics

2.

The Firms Market Posture

Firms that experience high sales growth and engage in product innovation for a wide market segment benefit from HR Strategies that support growth and entrepreneurial activities
example: External recruitment or buying skills, decentralized pay decisions, customized appraisal

Firms with low rates of sales growth and limited product innovation for a narrow market segment benefit from HR strategies that emphasize efficiency, control, and firm specific knowledge
example: Internal recruitment or making skills. On-the-job training, and high dependence on superiors

Human Resource Management by Shah M Saad Husain

Fit with Organizational Characteristics

3.

The firms overall managerial philosophy

Companies whose top executives are risk-averse and operate with an autocratic leadership style, and are inwardly focused use HR strategies that match this outlook
example: Seniority based pay, formal hiring and socializing of new employees, selection decisions made by the HR department and use of top-down communication channels.

Management characterized by high risk taking, participation, egalitarianism, and external, proactive environmental orientation use HR strategies that fits this outlook
example: include variable pay, giving supervisors a major role in hiring decisions, up-and-down communication channels, and multiple inputs for performance appraisals

Human Resource Management by Shah M Saad Husain

Fit with Organizational Characteristics

4.

The firms organizational structure

Highly formal organizations that are divided into functional areas like marketing, finance, production, etc, and concentrate decision making on top: HR strategies for such organizations include a control emphasis, centralized pay decisions, explicit job descriptions, and job-based pay.
Firms whose structures are less regimented benefit from HR strategies that include informal hiring and socializing of new employees, decentralized pay decisions, broad job classes and individual-based pay.

Human Resource Management by Shah M Saad Husain

Fit with Organizational Characteristics

5.

The firms organizational culture

Companies that foster an entrepreneurial climate have loose work planning, informal hiring and socializing of new employees and variable pay. Firms that discourage entrepreneurship generally prefer a control emphasis, detailed work planning, formal hiring and socializing of new employees, and fixed pay. Firms with emphasis on moral commitment- the extent to which a firm tries to foster a long-term emotional attachment between the firm and the employees have emphasis on preventive vs. remedial disciplinary action to handle employee mistakes, and explicit ethical codes to monitor and guide behavior. Firms that are low on moral commitment rely on authoritarian relationship between employee and company.

Human Resource Management by Shah M Saad Husain

Fit with Organizational Capabilities

Distinctive competencies of a firm are its capabilities such as technology, management systems, reputation, etc, that give it a Competitive Edge HR strategies should enhance a firms performance by:
1

helping the company exploit its specific advantages or strengths while avoiding weaknesses assisting the firm in better utilizing its unique blend of human resource skills and assets

2.

Human Resource Management by Shah M Saad Husain

Choosing consistent and appropriate HR tactics to implement HR strategies

The best-laid HR strategies may fail when specific HR programs are poorly chosen or implemented In addition to fitting with each of the four organizational characteristics; organizational strategy, environment, organizational capabilities and characteristics, a firms HR strategies should be mutually consistent HR strategies are likely to be successful if they reinforce one another rather than work at cross-purposes. example: Working in teams, but traditional individual based performance appraisals

Human Resource Management by Shah M Saad Husain

Choosing Consistent and Appropriate HR Tactics to Implement HR Strategies

Human Resource Management by Shah M Saad Husain

Competencies Required of HR Department to Become a Full Strategic Partner

Human Resource Management by Shah M Saad Husain