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Copyright © 2017 Pearson Education, Inc.
Part One
Introduction
Chapter 1
Introduction to Human Resource Management
Lecture Outline:
What Is Human Resource Management?
Why Is HR Management Important to All Managers?
Line and Staff Aspects of Human Resource Management
Line Managers’ Human Resource Management Responsibilities
The Human Resource Department
The Trends Shaping Human Resource Management
Workforce Demographics and Diversity Trends
Trends in How People Work
Improving Performance: At Work: HR as a Profit Center
Globalization Trends
Economic Trends
Technology Trends
Today’s New Human Resource Management
A Brief History of Personnel/Human Resource Management
Distributed HR and the New Human Resource Management
Trends Shaping HR: Digital and Social Media
A Quick Summary
HR and Strategy
Improving Performance: The Strategic Context
HR and Performance
HR and Performance and Sustainability
HR and Employee Engagement
The New Human Resource Manager
HR and the Manager’s Skills
HR and Ethics
HR Manager Certification
HR and the Manager’s Human Resource Philosophy
The Plan of This Book
The Basic Themes and Features
Practical Tools for Every Manager
Chapter Contents Overview
Part 1: Introduction
Part 2: Recruitment, Placement, and Talent Management
Part 3: Training and Development
Part 4: Compensation
Part 5: Enrichment Topics in Human Resource Management
The Topics Are Interrelated
Chapter Review
Chapter 1: Introduction to Human Resource Management 1-2
Copyright © 2017 Pearson Education, Inc.
Where Are We Now…
The purpose of this chapter explains what Human Resource Management is, and why it’s
important to all managers. We’ll see that human resource management activities such as hiring,
training, appraising, compensation, and developing employees are part of every manager’s job.
We’ll see that human resource management is also a separate function. The main topics we’ll
cover will include what is human resource management, the trends shaping human resource
management, human resource management today, the new human resource manager, and the
plan of the book.
Interesting Issues:
For many people today Elance (www.elance.com) symbolizes much of what’s new in human
resource management. Millions of freelancers from graphic designers to translators, accountants,
and lawyers register on this site. Employers then use Elance to find, screen, hire, and pay the
talent they need in more than 180 countries.
Learning Objectives:
1-1. Explain what human resource management is and how it relates to the management
process.
1-2. Briefly discuss and illustrate each of the important trends influencing human resource
management.
1-3. List and briefly describe “distributed HR” and other important aspects of human
management today.
1-4. List at least four important human resource manager competencies.
1-5. Outline the plan of this book.
Annotated Outline:
I. What Is Human Resource Management? – to understand what human resource
management is, it’s useful to start with what managers do. Most writers
agree that managing involves performing five basic functions: planning,
organizing, staffing, leading, and controlling. These functions in total
represent the management process.
A. Why Is HR Management Important to All Managers?
1. Avoid Personnel Mistakes – managers don’t want to make
personnel mistakes, like not having employees doing their best,
hiring the wrong person for the job, experiencing high turnover,
having to be in court due to discriminatory actions, being cited for
unsafe practices, letting a lack of training undermine department
effectiveness, or committing any unfair labor practices.
2. Improving Profits and Performance – to help ensure that you get
results – through people.
3. You May Spend Some Time as an HR Manager
4. HR for Small Business
Chapter 1: Introduction to Human Resource Management 1-3
Copyright © 2017 Pearson Education, Inc.
B. Line and Staff Aspects of Human Resource Management – in
organizations, line authority traditionally gives managers the right to issue
orders to other managers or employees. Line authortiy creates a superior
(order giver) – subordinate (order receiver) relationship. Staff authority
gives a manager the right to advise other managers or employees. It
creates an advisory relationship.
C. Line Managers’ Human Resource Management Responsibilities – line managers do
have many human resources duties such as the following:
a. Placing the right person in the right job
b. Starting new employees in the organization (orientation)
c. Training employees for jobs that are new to them
d. Improving the job performance of each person
e. Gaining creative cooperation and developing smooth working relationships
f. Interpreting the company’s policies and procedures
g. Controlling labor costs
h. Developing the abilities of each person
i. Creating and maintaining departmental morale
j. Protecting employees’ health and physical conditions
D. The Human Resource Department – provides specialized assistance and
knowledge.
1. New Approaches to Organizing HR
a. Centralized HR – units whose employees are shared by all the
companies departments to obtain advice on matters
b. Shared Services HR – teams that offer services through intranets or
centralized call centers
c. Corporate HR – teams within a company that assist top management
in top-level issues
d. Embedded HR – teams that have a HR generalist (also known as
“relationship managers” or “HR business partners”) assigned to
functional department
e. Centers of expertise – specialized HR consulting firms within the
company
II. The Trends Shaping Human Resource Management – trends are occurring in the
environment of human resource management that are changing how employers get
their human resource management task done. These trends include workforce
trends, trends in how people work, technological trends, and globalization and
economic trends.
A. Workforce Demographics and Diversity Trends – the composition of the workforce
will continue to change over the next few years; specifically it will continue to become
more diverse with more women, minority group members, and older workers in the
workforce.
B. Trend in How People Work – work has shifted from manufacturing jobs to
service jobs in North America and Western Europe. Today, over two-
thirds of the U.S. workforce is employed in producing and delivering
services, not products.
1. On-Demand Workers
Chapter 1: Introduction to Human Resource Management 1-4
Copyright © 2017 Pearson Education, Inc.
2. Human Capital
C. Globalization Trends – refers to companies extending their sales, ownership, and/or
manufacturing to new markets abroad.
D. Economic Trends – Figure 1-2 shows the gross national product (GNP), a
measure of the United States of America’s total output. Figure 1-3 shows
that during this period, home prices leaped as much as 20% per year.
Unemployment remained docile at about 4.7%. Then around 2007-2008,
all these measures fell off the cliff. GNP fell, home prices dropped by 10%
or more, and unemployment nation-wide soon rose to more than 10%.
1. Labor Force Trends – the labor force in America is growing more
slowly than expected. Mostly because with baby boomers aging, the
“labor force participation rate” is declining—in other words, the
percent of the population that wants to work is declining.
2. The Unbalanced Labor Force –although unemployment rate is
dropping, it’s doing so in part because fewer people are looking for
jobs (remember the shrinking labor participation rate). Demands for
workers is unbalanced.
E. Technology Trends – it may be techology that most characterizes the trends
shaping human resources management today. Five main types of digital
technologies are driving this transfer of functionality from HR
professionals to automation.
1. Social Media – employers increasingly use tools such as Twitter,
Facebook, and LinkedIn to recruit new employees.
2. Mobile Applications – used by employers, for instance, to monitor
employee location and to provide digital photos at the facility clock-in
location to identify workers.
3. Gaming – enables employers to inject features such as feedback, fun,
and objectives into training, performance appraisal, and recruiting.
4. Cloud Computing – a more intutive user interface that enables
employers to monitor and report on things like a team’s goal
attainment and to provide real-time evaluative feedback.
5. Data Analytics – uses statistical techniques, algorithms, and problem-
solving to identify relationships among data for the purpose of solving
particular problems; it is also called talent analytics.
III. Today’s New Human Resource Manager
A. A Brief History of Personnel/Human Resource Management – “Personnel
management” is not new. Ancient armies and organized efforts always required
attracting, selecting, training, and motivating workers. But tasks like these were
mostly just part of every manager’s job, something that lasted in most countries until
the late 1800s. By 1900, employers set up the first “hiring offices.” New union laws
in the 1930s added “Helping the employer deal with unions” to personnel’s tasks.
New equal employment laws in the 1960s made employers more reliant on personnel
management to avoid discrimination claims. By the 1970s, globalization made
gaining a competitive edge through engaged employees and therefore, personnel
management important. Today, economic, demographic, and technological trends
including mobile and social media are changing how employers recruit, select, train,
Chapter 1: Introduction to Human Resource Management 1-5
Copyright © 2017 Pearson Education, Inc.
appraise, and motivate employees. In a sense, a new human resource manager is
emerging.
B. Distributed HR and the New Human Resource Management – more and more human
resources management tasks are being redistributed from a central HR department to
the company’s employees and line managers.
C. Trends Shaping HR: Digital and Social Media –the new human resource
management tools that are changing how people look for jobs, and how
companies recruit, retain, pay, and train employees. Examples are career
sites, recruitment sites, and talent analytics tools.
D. A Quick Summary – Figure 1-4 illustrates a summary of what trends mean
for human resource management.
E. HR and Strategy – today’s human resources managers are more involved in
longer-term, strategic “big picture” issues.
F. Improving Performance: The Strategic Context – illustrates building L.L.Bean.
Today’s employers want their HR managers to put in place practices that will produce
the employee behaviors that help the company achieve its strategic aims.
G. HR and Performance – employers expect their human resources manager/”people
experts” to spearhead employee performance-improvement efforts. There are three
levers that can be applied: HR department lever, employee cost lever, and strategic
results lever.
1. HR and Performance Measurement – metrics are used to validate.
2. HR and Evidence-Based Management – the use of data, facts, analytics, scientific
rigor, critical evaluation, and critically evaluated research/case studies to support
human resource management proposals, decisions, practices, and conclusions. It’s
using the best-available evidence in making decisions about the human resources
practices being focused on.
a. Actual measurements
b. Existing data
c. Research studies
d. High-performance work systems
3. HR and Adding Value – boosting profits and performance.
H. HR and Performance and Sustainablitiy – company’s efforts being
measured not only by performance but also “substainable” by which they
mean judged not just on profits, but on their environmental and social
performance as well.
IV. The New Human Resource Manager – it’s more complicated being a human resource
manager today. It requires new competencies and skills. The Society of Human
Resources Management (SHRM) has itemized the behaviors and competencies (with
definitions) that today’s HR manager should be able to exhibit:
1. Leadership & Navigation – the ability to direct and contribute to initiatives and
processes within the organization.
2. Ethical Practice – the ability to integrate core values, integrity, and
accountability throughout all organizational and business practices.
3. Business Acumen – the ability to understand and apply information with which
to contribute to the organization’s strategic plan.
Chapter 1: Introduction to Human Resource Management 1-6
Copyright © 2017 Pearson Education, Inc.
4. Relationship Management – the ability to manage interactions to provide service
and to support the organization.
5. Consultation – the ability to provide guidance to organizational stakeholders.
6. Critical Evaluation – the ability to interpret information with which to make
business decisions and recommendations.
7. Global & Cultural Effectiveness – the ability to value and consider the
perspective and backgrounds for all parties.
8. Communication – the ability to effectively exchange information with
stakeholders.
9. SHRM also says HR Managers are to have command of the basic functional
areas of HR such as the following:
a. Functional Area #1: Talent Acquisition & Retention
b. Functional Area #2: Employee Engagement
c. Functional Area #3: Learning & Development
d. Functional Area #4: Total Rewards
e. Functional Area #5: Structure of the HR Function
f. Functional Area #6: Organizational Effectiveness & Development
g. Functional Area #7: Workforce Management
h. Functional Area #8: Employee Relations
i. Functional Area #9: Technology & Data
j. Functional Area #10: HR in the Global Context
k. Functional Area #11: Diversity & Inclusion
l. Functional Area #12: Risk Management
m. Functional Area #13: Corporate Social Responsibility
n. Functional Area #14: U.S. Employment Laws & Regulations
o. Functional Area #15: Business & HR Strategy
A. HR and the Manager’s Skills
B. HR and Ethics
C. HR Manager Certification – certifications are used to demonstrate mastery of
contemporary human resource management knowledge and competencies. HR
Certification Institute (HRCI) is an independent certifying organization for human
resource professionals. HRCI awards several credentials:
1. Professional in Human Resources (PHR)
2. Senior Professional in Human Resources (SPHR)
D. HR and the Manager’s Human Resources Philosophy – the basic assumptions you
make about people are – Can they be trusted? Do they like their work? And other
assumptions together comprise the philosophy of human resources. Another way the
philosophy is created is it should evolve as knowledge and experience is
accumulated. Also the organization’s top management molds the philosophy.
V. The Plan of This Book
A. The Basic Themes and Features
B. Practical Tools for Every Manager
1. Responsibility of every manager
2. Use human resource management techniques to improve performance,
productivity, and profitability.
Chapter 1: Introduction to Human Resource Management 1-7
Copyright © 2017 Pearson Education, Inc.
a. Improving Performance: HR Tools for Line Managers and Small
Businesses
b. Improving Performance: HR as Profit Center
c. Improving Performance: HR Practices Around the Globe
d. Improving Performance Through HRIS
e. Diversity Counts
3. How digital and high-tech trends are shaping human resource management
4. Understand how the employer’s human resource management policies and
practices produce the employee skills and performance the company needs to
achieve its strategic aims.
C. HR is the responsibility of every manager.
a. HR managers must defend plans and contributions in measurable
terms.
b. HR systems must be designed to achieve the company’s strategic
aims.
VI. Chapter Contents Overview
Part 1: Introduction
Chapter 1: Introduction to Human Resource Management
Chapter 2: Equal Opportunity and the Law
Chapter 3: Human Resource Management Strategy and Analysis
Part 2: Recruitment, Placement, and Talent Management
Chapter 4: Job Analysis and Talent Management
Chapter 5: Personnel Planning and Recruiting
Chapter 6: Employee Testing and Selection
Chapter 7: Interviewing Candidates
Part 3: Training and Development
Chapter 8: Training and Developing Employees
Chapter 9: Performance Management and Appraisal
Chapter 10: Managing Careers
Part 4: Compensation
Chapter 11: Establishing Strategic Pay Plans
Chapter 12: Pay for Performance and Financial Incentives
Chapter 13: Benefits and Services
Part 5: Enrichment Topics in Human Resource Management
Chapter 14: Build Positive Employee Relations
Chapter 15: Labor Relations and Collective Bargaining
Chapter 16: Employee Safety and Health
Chapter 17: Managing Global Human Resources
Chapter 18: Managing Human Resources in Small and Entrepreneurial
Firms
The Topics Are Interrelated
Chapter Review
Chapter Section Summaries:
