Management Chapter 1 The Rewards And Challenges Human Resources Management Outline Why Should

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CHAPTER 1

THE REWARDS AND CHALLENGES OF HUMAN

RESOURCES MANAGEMENT

CHAPTER OUTLINE

1.1 Why Should You Study Human Resources Management? Will It Pay Off?

1.1a Human Capital and Organizational Culture

1.2 Strategic and Global Challenges

1.2a Responding Strategically to Changes and Disruptions in the Marketplace

1.2b Competing, Recruiting, and Staffing Globally

1.2c Setting and Achieving Corporate Social Responsibility and Sustainability Goals

1.3 Technology Challenges

1.4 Productivity and Cost Challenges

1.4a Maximizing Productivity

1.5 Employee Challenges

1.5a Responding to the Demographic and Diversity Challenges of the Workforce

1.5b Educational Shifts Affecting the Workforce

1.5c Adapting to Cultural and Societal Changes Affecting the Workforce

1.6 The Role HR Managers Play and Their Partnership with Other Managers

LEARNING OUTCOMES

After studying this chapter, students should be able to:

1. Explain how human resource managers and other managers can have rewarding careers

3. Describe how technology can improve how people perform and how they are managed.

5. Discuss how firms can leverage employee differences to their strategic advantage and

6. Provide examples of the roles and competencies of today’s HR managers and their

relationship with other managers.

2 Part 1: Human Resources Management in Perspective

GENERATING INTEREST

A good way to kick off this course is this simple statement that is probably true at least

80 percent of the time: “The way management treats the employees is the way employees

will treat the customers.”

This statement can be proven by acquainting your students with Fortune magazine’s

annual ranking of the “100 Best Companies to Work For.” Locate the link to the most

• ESOPs

• Stock options

• Raises

• Unusual perks (doggie day care, onsite farmers’ market, three months’ paid

maternity leave, free gourmet food, incredible fitness facilities that will detail

employees’ cars or do their dry cleaning while they work out)

• Employee suggestion programs

Many other areas can be discussed as they relate to this introductory chapter: the

percentage of minorities, percentage of women, and voluntary turnover statistics.

Finally, prove the rest of the statement that “the way management treats the employees is

the way employees will treat the customers” by going to www.greatplacetowork.com and

finding articles that illustrate that “Great workplaces outperform their peers.”

The HRM cycle can play out at least two ways:

• If management treats employees well, the odds increase that employees will treat

the customers well. Happy customers typically become repeat customers, which

can positively impact the company’s financial performance, which can help the

company improve its compensation and benefits packages.

Chapter 1: The Rewards and Challenges of Human Resources Management 3

• If management does not treat employees well, the odds increase that employees

will not treat the customers well. Unhappy customers often take their business

elsewhere, which can negatively impact the bottom line, which can mean that

management has to cut back, which often results in continued poor treatment of

employees by management.

DEALING WITH TROUBLE SPOTS

Many students who take this course have their perspectives dramatically broadened

regarding how business functions, including HR, work together to achieve an

organization’s success. The Baldrige Performance Excellence Program provides insight

into the key factors that shape your organization’s operating environment. Go to

https://www.nist.gov/baldrige/baldrige-criteria-commentary and read Baldrige Criteria

Commentary. Presenting this material to your students can help them begin the course

with the big-picture organizational perspective that provides a framework for seeing the

importance of HR.

LECTURE OUTLINE

Discussion Starter #1: Will technology eliminate the need for human resource managers?

1.3.

1.1 Why Should You Study Human Resources Management? Will It Pay Off? Figure 1.1

(1) All managers are responsible for at least some of the activities that fall into the

1.1a Human Capital and Organizational Culture

Human capital is the knowledge, skills, and capabilities of individuals that have

economic value to an organization. Human capital is intangible. Managers should

develop and retain top performers.

4 Part 1: Human Resources Management in Perspective

Organizational culture is the shared values, beliefs, and assumptions people in

an organization have. It affects how people work together and how they treat

others.

Teaching Tip: Use Figure 1.1 to examine the framework of HRM. The box containing challenges can

lead into the next section, which discusses challenges companies face.

EOC Discussion Question #1: Are people always an organization’s most valuable asset? Why or

why not? Suppose your boss asked you to summarize the major people-related concerns related

to opening an office in India. What issues would be on your list?

1.2 Strategic and Global Challenges

Adaptability is the key to survival for an organization.

1.2a Responding Strategically to Changes and Disruptions in the Marketplace

Agility is a firm’s ability make quick changes to gain a competitive advantage.

Eliminating managerial layers is a common way of achieving agility.

1.2b Competing, Recruiting, and Staffing Globally

Importing and exporting goods and services is the easiest way to “go global.” The

1.2c Setting and Achieving Corporate Social Responsibility and Sustainability Goals

Globalization has led to an improvement in people’s living standards. Corporate

Chapter 1: The Rewards and Challenges of Human Resources Management 5

Video Highlight #1: Section 1.2c: Setting and Achieving Corporate Social Responsibility and

Sustainability Goals

VIDEO: A Sustainable Chef (4:55)

Today, many chefs are using their restaurants to push for sustainability and social change. Ben

Discussion Starter #2: Name a company you hope to work for someday. What is its track record in

terms of corporate social responsibility and sustainability? Are these factors important to you?

Why or why not?

EOC Discussion Question #2: Name a company you hope to work for someday. What is its track

record in terms of corporate social responsibility and sustainability? Are these factors important

to you? Why or why not?

1.3 Technology Challenges

Advancements in technology have changed the business world—cloud computing and

social media are prime examples. Technology requires knowledge workers rather than

touch workers. Knowledge workers are workers whose responsibilities extend beyond

the physical execution of work to include planning, decision-making, and problem-

solving.

6 Part 1: Human Resources Management in Perspective

Big data describes the massive amounts of data available that can be used to make

EOC Discussion Question #3: Will technology eliminate the need for human resource

managers?

1.4 Productivity and Cost Challenges

Spend more money to drive employee costs lower by increasing employee productivity.

1.4a Maximizing Productivity

(2) increasing the amount that employees produce by adding more human and/or

physical capital to the process.

1.4b Managing the Size of the Workforce

To manage productivity, match the size of the workforce to the demand,

considering technology, the firm’s strategic direction, and global competition.

1.4c Managing Pay and Benefits

Although firms closely monitor employee pay and benefit programs, health care

costs are a major concern. Employee leasing and freelance employees can keep

EOC Discussion Question #4: Do cost-containment pressures work against the effective

management of people? Why or why not?

1.5 Employee Challenges Figure 1.2

8 Part 1: Human Resources Management in Perspective

As technology changes, companies develop privacy policies to protect

information they collect from applicants and employees. Employers have the right

to monitor employees’ behavior on the job.

Employee engagement is the extent to which employees are enthused about their

work and committed to it. Engaged employees perform better than disinterested

employees.

Discussion Starter #3: What are the pros and cons of having a more diverse workforce? Is the

United States in a better position to compete globally because of its diverse population?

ANSWER: Students’ answers may vary. Probably most students will focus on the pros and say that

EOC Discussion Question #5: What are the pros and cons of having a more diverse workforce?

Is the United States in a better position to compete globally because of its diverse population?

1.6 The Role HR Managers Play and Their Partnership with Other Managers Figure 1.7

Figure 1.8

Teaching Tip: Use Figure 1.7 to discuss the growth of the HR management career field and its value

to organizations.

1.6a Responsibilities of Human Resource Managers

1.6b Competencies Human Resource Managers Require

HR managers need business mastery, HR mastery, and personal credibility.

Teaching Tip: Use Figure 1.8 to discuss skills HR managers need. Ask students for examples of each

skill.

EOC Discussion Question #6: In your opinion, what is the most important role HR managers

play?

Chapter 1: The Rewards and Challenges of Human Resources Management 9

ANSWERS TO END-OF-CHAPTER DISCUSSION QUESTIONS

1. Contrary to what many managers might say, people are not always an organization’s

most important asset. In fact, many times managers adversely affect the impact

2. Students’ answers will be based on their values and background. Some students may be

it.

3. Students’ answers will vary. Any answer is at least partially speculative. Regardless of

4. Students’ answers may vary. This is an interesting opinion question. Perhaps the class

can be divided into discussion groups, who will report back to the class with their

5. Students’ answers may vary. Probably most students will focus on the pros and say that

the United States benefits from its diverse population. However, challenge the students to

6. Students’ answers will vary. This question is meant to stimulate conversation about the

complementary roles within HRM—how they fit together and support the business.

10 Part 1: Human Resources Management in Perspective

NOTES FOR END-OF-CHAPTER CASE STUDIES

Case Study 1: New HR Strategy Makes Lloyd’s a “Best Company”

1. The case does not specify the skills that Black thinks the workforce in general needs to

work successfully in HR; however, based on the focus of her efforts and on what she has

indicated regarding the ideal characteristics of future HR professionals, several things are

2. Some of the outcomes of the company’s new HR strategy include not only a more

positive internal organizational environment in which employees can function more

3. Some of the challenges of establishing HR policies for a global company include culture

(along with religion), communication, laws, and economic systems. A policy that is

4. Situations that might require an HR manager to say “no” could involve almost any HR

policy or objective that might pay off for the firm but not for a given person, department,

or team. Black spoke of the need to say no in order to establish appropriate boundaries—

Chapter 1: The Rewards and Challenges of Human Resources Management 11

Case Study 2: Shell’s Top Recruiter Takes His Cues from Marketing

1. Recruitment, by its very nature, involves marketing. Firms that have an abundance of

highly qualified applicants trying to sell themselves in pursuit of a limited number of jobs

do not need to recruit. However, marketing not only seeks to sell something to a customer

2. Students’ answers will vary. However, some may say that to become an employer of

choice a firm needs to understand the needs and values of the type of employees the firm

3. Students’ answers will vary. Depending on the size of the class, instructors might divide

the class into two debate teams to discuss the question. The correctness of the statement

FLIP TIPS

Group Activity

Step 1: Split into groups and select a company to which you would consider applying.

Step 2: Assess the company’s HR policies. Consider these policies as the criteria for