CH-1-2 Strategic Importance of Human Resource Management – Canadian Human Resource Management: A Strategic Approach : Book Guide

This Document Contains Chapters 1 to 2 1 STRATEGIC IMPORTANCE OF HUMAN RESOURCE MANAGEMENT CHAPTER OBJECTIVES After studying this chapter, you should be able to: Discuss the objectives of human resource management. Identify steps in strategic management of human resources. Explain how human resource departments are organized and function. Discuss the role of human resource professionals in today’s organization. POWERPOINT® SLIDES Canadian Human Resource Management includes a complete set of Microsoft PowerPoint® files for each chapter. (Please contact your McGraw-Hill Ryerson representative to find out how instructors can receive these files.) In the lecture outline that follows, a reference to the relevant PowerPoint slide for this chapter is placed beside the corresponding lecture material. The slide number helps you to see your location in the slide show sequence and to skip slides that you don’t want to show to the class. (To jump ahead or back to a particular slide, just type the slide number and hit the Enter or Return key.) LECTURE OUTLINE (with PowerPoint® slides) Strategic Importance of Human Resource Management Slide 1 What is HRM? Slide 2 Strategic HRM Slide 3 Proactive HRM Slide 4 Steps in Strategic HRM Step 1: Environmental Scan Slide 5 Economic Forces Slide 6 Economic Forces Slide 7 Economic Forces Slide 8 Economic Forces Slide 9 Technological Forces Slide 10 Technological Forces Slide 11 Technological Forces Slide 12 Demographic Forces Slide 13 Demographic Forces Slide 14 Demographic Forces Slide 15 Demographic Forces Slide 16 Demographic Forces Slide 17 Cultural Forces Slide 18 Step 2: Organizational Mission and Goals Analysis Slide 19 Step 3: Analysis of organizational character and culture Slide 20 Step 4: Analysis of organizational strategies Slide 21 Step 5: Choice and implementation of HR strategies Slide 22 Step 6: Review and evaluation of human resource strategies Slide 23 The Organization of HRM Slide 24 The Service Role of the HR Department Slide 25 Today’s HR Professional Slide 26 STRATEGIC IMPORTANCE OF HUMAN RESOUCE MANAGEMENT INTRODUCTION—WHAT IS HRM? HRM is the leadership and management of people within an organization using systems, methods, processes, and procedures that enable employees to optimize their contribution to the organization and its goals. HRM aims to support and enable organizations to meet their short- and long-term economic, social, and environmental goals. STRATEGIC HUMAN RESOUCE MANAGEMENT • A strategy is similar to a game plan and is linked to the strategic needs of an organization—formulated at three levels: corporate, business, and functional • Human Resource strategies and tactics must be mutually consistent—strategies may fail if they are not supported by effective tactics, i.e. methods and procedures • Human Resource strategies need to reflect the organization’s mission and strategies, i.e., be consistent with organizational priorities PROACTIVE HRM STRATEGIES Strategic HRM should be proactive rather than reactive. • Proactive -- Strategic HRM often enables an organization to anticipate a problem and respond to it before causing damage to the organization -- Occurs when HR problems are anticipated and corrective action begins before the problem exists • Reactive -- Occurs when decision-makers respond to HR problems UNDERSTANDING THE STRATEGIC HRM PROCESS STEP 1. ENVIRONMENTAL SCAN • Continuous monitoring of economic, technological, demographic, and cultural forces and noting changes in governmental policies, legislation, and statements • The environmental scan includes the following economic forces: economic cycles, global trade, productivity improvement, global competitiveness Economic Force: Economic cycles • The Canadian economy goes through boom and bust cycles, which are often linked to boom and bust cycles in other economies • During recessionary periods, HR managers face challenges associated with layoffs, wage concessions, and the lower morale that accompanies recessions. • During boom cycles, HR managers must consider how to recruit and develop the organization’s talent base. Economic Force: Global trade • For Canada, international trade has always been a crucial issue -- Canada ranks high among exporting nations, exporting more than U.S. and Japan on a per capita basis -- Canadian jobs and economic prosperity depend upon international trade -- Exports of goods and services account for 31% of Canada’s Gross Domestic Product (GDP) Economic Force: Productivity Improvement • Productivity refers to the ratio of an organization’s outputs (goods and services) to its inputs (people, capital, material, and energy) -- Productivity improvement is essential for long-term success i.e., to reduce costs, save scare resources, and enhance profits • HR professionals contribute to improved productivity directly by finding better, more efficient ways to meet their objectives and indirectly by improving the quality of work life for employees • To meet productivity ratios, HR professionals may use outsourcing, outplacement, part-time workers, and contingent workers -- Nearly a quarter of all employment is part-time -- Contingent workers comprise nearly 25% of the workforce as well. The use of contractors is becoming popular in not only lower level, clerical or secretarial jobs but also for professional jobs like lawyers and accountants. Economic Force: Global Competitiveness • Productivity levels in the U.S., consistently outpace those in Canada • In recent years, Canada’s ability to innovate and create wealth has not kept pace with other countries—Canada ranked ninth as compared to sixth a decade ago. • Canada only holds 2% of the world’s patents, while the U.S. and Japan hold 60% The environmental scan includes technological forces: flexible work design, information sharing and knowledge management, and automation Technological Force: Flexible Work Design • An unprecedented degree of technology has changed the way we work, play, study, and entertain ourselves, while access to information has affected the way several organizations conduct their business. • Technology has brought flexibility into when and where work is carried out. For instance, employees can work without leaving their homes through telecommuting Technological Force: Information Sharing and Knowledge Management • More effective knowledge management – the process of capturing organizational knowledge and making it available for sharing and building new knowledge – has been another outcome of digital information systems • Information management systems store integrated information that can be accessed quickly and accurately • The internet has had a profound impact on human resource activities through social networking sites, video-sharing sites, wikis, blogs, and other interactive opportunities to own and control data, and add value to the applications used. Technological Force: Automation • Organizations automate to increase speed, provide better service to customers, increase predictability in operations, achieve higher standards of quality in production, and increase flexibility • May use robots to replace boring or hazardous jobs The environmental scan also includes demographic forces: gender balance in the workplace, shift towards knowledge workers, educational attainment of workers, aging population, generational shift Demographics of the labour force describe the composition of the workforce e.g. education levels, age. Demographic changes occur slowly and can usually be predicted with considerable accuracy. Demographic Force: Gender Balance in the Workplace • Nearly 48% of the workforce in 2012 are women • Women accounted for 70% of employment growth in Canada in last twenty years -- Raises importance of child care, work-family balance, dual career families, and employment equity Demographic Force: Shift toward knowledge workers • Shift from employment in primary and extractive industries to service, technical, and professional jobs; nearly 78% of the total labour force is employed in service producing industries. -- Information workers (data and knowledge workers) and non-information workers -- Knowledge workers have been the fastest growing type of workers in Canada—organizations need to attract, retain, and retrain these knowledge workers Demographic Force: Educational attainment of workers • Increases are expected to continue, however, 9% of women and 15% of men drop out of school; currently more than 8 million Canadians lack basic school certificate or diploma. Demographic Force: Aging Population • Average age of the workforce is increasing (impending “old age crisis”), along with the general aging population in Canada -- Pressure for expanded retirement benefits, variable work schedules, coordination of government benefits with company benefits, and retraining programs, etc. Demographic Force: Generational Shift • The Baby Boomers, Generation X, and Generation Y are qualitatively different workers • Although the differences within groups may be wider than the differences between groups, understanding that people have different expectations from their workplaces is a useful starting point The environmental scan also includes cultural forces: diversity, ethics Cultural Force: Diversity • Canadian society is a cultural mosaic—Canada encourages maintaining unique culture and heritage vs. U.S. “melting pot” -- Brings opportunities and challenges for an HR department Cultural Force: Ethics • Ethical conduct of business is becoming an increasingly important issue. Managers should understand different ethical perspectives and take into account the ethical implications of their decisions. STEP 2. ORGANIZATIONAL MISSION AND GOALS ANALYSIS • The organization’s overall mission and goals guide the human resources that are needed to fulfil the mission and goals • For instance, goals such as productivity (or revenue surplus), organizational growth, employee satisfaction, efficiency, ability to adapt to environmental changes, etc., will help to identify human resources strategies STEP 3. ANALYSIS OF ORGANIZATIONAL CHARACTER AND CULTURE • Human resource strategies should be formulated only after a careful look at the organization’s character: its employees, objectives, technology, size, age, unions, policies, successes, and its failures. Character reflects the organization’s past and shapes the future. • Each organization has a unique culture—core beliefs and assumptions that are widely shared by all organizational members. Need to be familiar with and adjust to the culture of the organization. STEP 4. ANALYSIS OF ORGANIZATIONAL STRATEGIES There are three generic organizational strategies: • Cost Leadership strategy: Aims to gain competitive advantage through lower costs, e.g., seek efficiency and use tight controls • Differentiation strategy: Focuses on creating a creating a distinctive or unique product that is unsurpassed in quality, innovative design or other feature, i.e., achieved through product design, unique technology, or even advertising and promotion • Focus strategy: Concentrates on segment of the market and attempts to satisfy that segment’s with a low-priced or highly distinctive product STEP 5. CHOICE AND IMPLEMENTATION OF HUMAN RESOURCE STRATEGIES Strategic choice and implementation involved identifying, securing, organizing, and directing the use of resources both within and outside the organization. • Ultimately, there should be a clear line of sight between the human resource strategy and the corporate goals. • The HR strategy must reflect every change in the organizational strategy and support it. • In formulating strategies, the HR department must continuously focus on the following 5 groups of activities: • Planning Human Resources—Job Analysis, HR Planning • Attracting Human Resources—Meeting Legal Requirements, Recruitment • Placing, Developing and Evaluating Human Resources—Training, Development, Career Planning, Performance appraisals • Motivating Employees—Compensation, Benefits, Employee Motivation • Maintaining High Performance—Employee Relations, Meeting the Needs of a Diverse Workforce, Safety, Union Relations Note: Defined action plans with target achievement dates are required to ensure effective implementation of HR strategies STEP 6. REVIEW AND EVALUATION OF HUMAN RESOURCE STRATEGIES • Strategies should be examined periodically for their continued appropriateness and with consideration for changing factors, e.g., technology, environments, internal factors, etc. • A human resource audit involves a holistic examination of the human resource policies, practices, and systems of a firm (or division) to eliminate deficiencies and improve ways to achieve goals • HR departments must also focus on looking to the future to be proactive in their orientation THE ORGANIZATION OF HRM The Human Resource Department in a Small Organization • A separate HR department emerges in an organization when the human resource activities become a burden to other departments—often emerges as a small department or an individual reporting directly to a middle-level manager -- Typical duties include maintaining employee records, helping managers find new recruits A Large Human Resource Department • As the organization grows, the HR department usually grows in impact/complexity and specialists are added, often in the areas of employment, compensation, training, safety, employee and labour relations • Greater importance of the head of human resources may be signified by a change in title to “Vice President” THE SERVICE ROLE OF THE HR DEPARTMENT • Staff Authority -- Human resource departments are service departments. They exist to assist employees, managers, and the organization -- Authority to advise, not direct managers in other departments • Line Authority -- Possessed by managers of operating departments, allows these managers to make decisions about production, performance and people • Functional Authority -- In highly technical or extremely routine situations, the human resource department may be provided the authority to make decisions usually made by line managers or senior managers, e.g., deciding the type of benefits provided to employees TODAY’S HUMAN RESOURCE MANAGEMENT PROFESSIONAL • In the last thirty years, there has been an enormous growth in the number of HR managers (1971: 4,055; 1999: more than 43,000) -- HRM has been slow to evolve into a full-fledged profession • Human Resource managers expected to possess competencies including: Mastery of HRM Tools, Change Mastery, Personal Credibility • CCHRA (Canadian Council of Human Resources Associations), a collaborative effort of HR Associations from across Canada, coordinates the nationally recognized designation in HR called the CHRP (Certified Human Resources Professional) ANSWERS TO REVIEW AND DISCUSSION QUESTIONS 1. What are the goals of a human resource department? Choose an organization that you are familiar with and indicate which of these goals will be more important in this organization and why. Strategic HRM is systematically linked to the strategic needs of an organization and aims to provide it with an effective work force while meeting the needs of its members and other constituents in society. HRM aims to improve the productive contribution of individuals while simultaneously attempting to achieve other societal and individual objectives. In practice, this means that the department is attempting to achieve the organizational, functional, societal, and individual (or personal) goals of employees wherever feasible. Today’s organizations must be able to survive and compete in a vastly changed world, where high productivity and effectiveness are cornerstones to success. The HR department aims to achieve these goals while at the same time attempting to satisfy societal and employee individual needs. 2. Draw a diagram of a HR department in a firm that employs over 5,000 persons, and name the likely components of such a department. Which of these functions are likely to be eliminated in a small firm employing 50 persons? See Figure 1-15, p. 28 in the text. In a small firm, the middle-level managers are likely to be eliminated. 3. Identify and briefly describe three major external challenges (choosing one each from economic, technological, and demographic categories) facing human resource managers in Canada and their implications. Examples can be taken from Figure 1-2, p. 7; the discussion is on pp. 6 to 18. 4. Outline the three major strategies pursued by Canadian businesses. What implications do they have for human resource function within the firms? Illustrate your answers with suitable examples. The three major strategies are cost leadership, focus, and differentiation (See p. 20). 5. What are four trends (or attributes) in the Canadian labour market that have implications for a human resource manager? Explain your answer citing which of the HR functions will be affected and how. Trend 1: The increasing number of women in the work force. HR Dimensions: Benefits (child care, counselling for two-career families), recruitment, selection (employment equity, promotion). Trend 2: Shift toward knowledge workers. HR Dimensions: Recruitment and Selection (recruitment strategies, selection criteria), training and development (special programs), compensation (pay for knowledge, not skills). Trend 3: Educational attainment of workers. HR Dimensions: Training and development (re-training programs), compensation (incentives). Trend 4: Aging population. HR Dimensions: Training (re-training programs), benefits (coordination of government and company benefits), work options (variable work schedules). Trend 5: Generational Shift. HR Dimensions: Recruitment, training, benefits (what is desirable), work options (flexibility). See the discussion on pp. 12-16 of the text. ANSWERS TO CRITICAL THINKING QUESTIONS 1. Suppose your company is planning a chain of high-quality restaurants to sell food products that the company already produces. Outline which areas of human resource management will be affected. Virtually every area of human resource management will be affected. Initially, consideration will have to be given to human resource planning, recruitment, selection, training, compensation, and overall employee communications and relations. Once the business is established, plans nor the further development of present employees, career planning, and performance evaluation will have to be undertaken. 2. If a bank is going to open a new branch in a distant city, with what inputs will the human resource department be concerned? What activities will the department need to undertake in the transition to a fully staffed and operating branch? What type of feedback do you think the department should seek after the branch has been operating for six months? The primary inputs of concern to the human resource department are the availability of the needed workers in the branch bank’s locale, staffing requirements, and anticipated salary levels. Creating a fully operating branch requires a plan for the human resources needs and then to recruit, select, hire, and train the personnel. Perhaps the most important feedback the human resource department should seek after the branch has operated for six months is an evaluation of employee performance. This information enables the human resource department to assess how successful it was in conducting the necessary human resource activities needed to start the branch bank. 3. Find two recent news items and explain how these developments might affect the demands made on the HR department of an organization. Answers will vary. 4. Suppose the birthrate during the early 2000s was to double from the low rates of the 1990s. What implications would this growth have in the years 2020 and 2030 for (a) grocery stores, (b) fast food restaurants, (c) Canadian Armed Forces, (d) large metropolitan universities? (a) Grocery store: it will probably be easier to hire staff due to larger supply, more difficult for older workers to find jobs. (b) Fast food restaurants: can be selective in hiring; large supply (higher selection ratio); lower turnover due to lack of alternatives. (c) Canadian Armed Forces: more applicants; higher selection ratio; higher quality recruits. (d) Large metropolitan university: higher enrolment; higher staffing needs; higher revenues. 5. Assume you were hired as the human resource manager in a firm that historically gave low importance to the function. Most of the human resource management systems and procedures in the firm are outdated. Historically, this function was given a low-status, “record-keeping” role within the firm. Armed with sophisticated HR training, you recently entered the firm and want to upgrade the HR systems and status of the department. In other words, you want to make management recognize the true importance of sound HR practices for strategic success. What actions will you take in the short and long term to achieve your goals? Be specific in our action plans and illustrate your steps where relevant. Answers will vary. Short-term suggestion: Make HRM relevant to line managers. Show some tangible benefits (e.g., improved communication, faster processing of departmental requests). Medium and Long term: Encourage their input in formulating the overall HR strategy and policies; encourage human resource audit to bring about continuous improvements; show tangible contributions (e.g., reduced employee turnover, better morale, reduced absenteeism; better legal compliance). ETHICS QUESTION Comments to Instructors There is no right or wrong answer to this question. It is for class discussion purposes. WEB RESEARCH Comments to Instructors These exercises have been designed for students to demonstrate their computer and Internet skills to research the required information. Answers will vary INCIDENT 1.1: HUMAN RESOURCE DECISION MAKING AT CALGARY IMPORTERS LTD. Incident Comments A constantly recurring issue between human resource departments and operating managers is who should make critical human resource-related decisions. Operating managers claim they are responsible for results, therefore, they should have the authority to hire, fire, compensate, and perform other human resource activities. However, when operating managers are given complete control, inequities and inconsistencies arise. If you were president of Calgary Importers Ltd. And were asked to resolve this dispute, which argument would you agree with? Why? Because managers are responsible for their performance, the president risks depriving these managers of the authority they need to do their jobs if they are not allowed to make human resource decisions about their staff. Thus, supporting the line manager’s need for decision-making authority seems reasonable arrangement. However, when different managers make decisions looking at only departmental needs, consistency in overall HR practices may be lost. The result could be confusion, sense of inequity on the part of employees and potential legal violations Can you suggest a compromise that would allow line managers to make these decisions consistently? Most organizations strive to achieve consistency in their human resource decision making without depriving the manager of the authority to make decisions. This compromise approach results in operating managers being able to make decisions within the department’s guidelines. Usually these decisions, particularly with respect to major changes, are subject to review by the department’s specialists. If the review by the human resource department uncovers inconsistencies, the manager is advised of the problem and given an advisory recommendation to remove the inconsistency. If the manager persists in ignoring the policy or advice, managers at higher levels are consulted. INCIDENT 1.2: CANADIAN BIO-MEDICAL INSTRUMENTS LTD. Incident Comments When enterprises expand internationally, many new considerations have to be taken into account. Besides cross-cultural issues, local constraints will have to be considered. International HRM requires creativity, tolerance, and adaptability at all levels of management. Assume you are the vice-president in charge of human resources. What additional information would you want these three employees to find out? Apart from legal details, the firm would want to find out, among other things: • the availability of locally qualified personnel • the local salary levels and benefits • the cost of living • immigration and work permit requirements for foreign nationals • the structure and work climate in a typical German firm of this size (including the degree of worker participation present) • major unions in the industry and their policies • safety and health requirements for employees What human resource issues or policies are you likely to confront in the foreseeable future? • hiring of employees (either locally or in Germany) • training of employees who have to work in Germany in that country’s customs, laws, living conditions, and work ethic (in the case of Canadians who are hired to work in Germany) • safety, health, and employment laws • compensation issues • performance appraisal criteria for expatriate managers and staff • planning the career path of expatriate managers on their return after assignments. Research shows that a substantial number of expatriates leave their employer because of the employer not meeting their expectations on their return. • communication with expatriate employees and managers CHAPTER CASE STUDY: MAPLE LEAF SHOES LTD., A STRATEGIC MANAGEMENT EXERCISE Answers to Discussion Questions 1. What are some changes within Maple Leaf Shoes and in its environment that have caused a shift in its strategy? List the challenges facing the company using the classification provided in your text. Students may point out any of the number of changes that have occurred in the firm and its environments. Samples include: • The firm’s cost of production is on the rise. • There seems to be more competition, especially based on price. Maple Leaf Shoes’ prices are no longer very low priced compared to those of other manufacturers. • Remaining non-managerial staff are about to be unionized. • There is increasing competition from abroad. Several of the new competitors are from countries such as Mexico and Thailand, which have lower labour costs. • The planned facilities in Indonesia (and plans to enter India and Mexico) raise new HR challenges in the areas of managerial training (especially those who have Asian assignments), diversity training, and developing new HRM policies and systems to be suitable for an international organization. • There is a lack of well-trained managerial and supervisory staff. The growth plans will make this even more apparent in future. Several of the challenges listed in Figure 1-1, pg. 4 can be added to the above list. 2. Assume that you are hired as a consultant to help the firm hire a new human resource manager. What immediate and long-term job responsibilities will you identify for the new job incumbent? The immediate priorities will be: • Meeting human rights legislation requirements and the requirements imposed by various federal and provincial laws. • Preparing for contract negotiations with unions. • Job analysis of key functions and task holders to set the stage for cost-reduction proposals. • Employee relations, especially fostering communication with employees and improving the overall morale by establishing necessary administrative systems. The long-term priorities will be: • Training and developing managers and other staff to prepare them for future expansion. • Employment planning, which will also involve the preparation of skills inventories and replacement charts, and employee career counseling. This will also have to be tied to a performance appraisal system. • Facilitating organizational changes to accommodate new priorities imposed by growth and expansion. 3. Identify three sample objectives of the human resource department at Maple Leaf Shoes and list associated strategies and action plans to be implemented by the department. There may be a number of acceptable answers here. It is recommended that the instructor evaluate the objective for its clarity and rationale. Financial information is given in Table 1, pg. 40. For example: The objective may be: “To train 20 percent of the current managerial staff in topics X, K, and Z by 15-7-2012 at a cost not exceeding $_. The trained managers should be able to do (a) ____ , (b) ____ , and (c) ________ satisfactorily.” This could translate into actions such as: 1. Identifying the sample of managers who need training. Thus, the training needs analysis must be completed by a set date (with monetary and resource constraints attached to it). 2. The training methodology must be identified next, choosing from lecture, role playing, computer simulation, on-the –job training, etc. Once again, the person responsible for each action and the date by which the action must be completed is to be identified. CASE STUDY: CANADIAN PACIFIC AND INTERNATIONAL BANK Answers to Discussion Questions 1. What are some major challenges facing CPIB? The major challenge to CPIB is to improve its competitive position by becoming ore innovative. Specifically, technological developments have allowed for electronic banking and virtual banks with lower overhead costs. Further, shareholders have been demanding more voice in bank decisions. More broadly, CPIB operates in a highly regulated industry. Due to such regulations, Canadian banks feel they are at a disadvantage relative to U.S. banks. 2. What are the specific implications for the human resource function? HRM must take a proactive approach to meet the technological and competitive challenges. This includes a thorough environmental analysis to identify environmental threats and opportunities. Such an analysis may suggest adopting cutting-edge technology, for example. As discussed on page 20, the type of organization strategy that CPIB adopts will greatly affect HR priorities and practices. If a focus strategy is used, this would indicate a high emphasis on training, with moderate emphasis on both skill application and flexibility to change. 3. What suggestions do you have for the current challenges faced by the HR function? The bank should adopt a differentiation strategy because this is consistent with their history of capitalizing on opportunities, especially in opening up in foreign markets. It should continue to innovate technologically as it did before as a key player in the development of e-commerce. To address the concerns of shareholders, CPIB should emphasize it s lean operations yet still maintain its practice as a good corporate citizen. Adopting such a strategy means that employees should be selected on the basis of broad skills and their creativity and innovation, while training and development are given high emphasis. HRM should foster an environment that encourages employee flexibility to deal with change. 2 JOB ANALYSIS AND DESIGN CHAPTER OBJECTIVES After studying this chapter, you should be able to: Describe the uses of job analysis information for human resource managers. Discuss the various steps in conducting job analysis and methods of job data collection. Describe the contents of a job description and a job specification. Discuss the various approaches to setting performance standards. Outline the key considerations in job design. POWERPOINT® SLIDES Canadian Human Resource Management includes a complete set of Microsoft PowerPoint® files for each chapter. (Please contact your McGraw-Hill Ryerson representative to find out how instructors can receive these files.) In the lecture outline that follows, a reference to the relevant PowerPoint slide for this chapter is placed beside the corresponding lecture material. The slide number helps you to see your location in the slide show sequence and to skip slides that you don’t want to show to the class. (To jump ahead or back to a particular slide, just type the slide number and hit the Enter or Return key.) LECTURE OUTLINE (with PowerPoint® slides) Job Analysis and Design Slide 1 Job Analysis Slide 2 Job Analysis Terminology Slide 3 HR Activities Relying on Job Analysis Slide 4 INTRODUCTION Human resource specialists need to understand the actual characteristics that presently exist in each job • Job analysis is the systematic study of a job to discover its specifications and skill requirements for use in wage-setting, recruitment, training or job-simplification purposes • Job is a group of related activities and duties; one or more people may do the same job at an organization • Position is a collection of tasks and responsibilities performed by an individual MAJOR HUMAN RESOURCE MANAGEMENT ACTIVITIES THAT RELY ON JOB ANALYSIS INFORMATION 1. Improve productivity • Efforts to improve employee productivity levels necessitate careful study of jobs 2. Eliminate discrimination • Elimination of unnecessary job requirements that can cause discrimination in employment 3. Creation of recruitment materials • Creation of job advertisements used to generate a pool of qualified applicants 4. Person-job matching • Matching of job applicants to job requirements 5. Planning • Planning of future human resource requirements 6. Training • Determination of employee orientation and training needs 7. Compensation • Fair and equitable compensation of employees 8. Performance standards • Identification of realistic and challenging performance standards 9. Re-design jobs • Re-design of jobs to improve performance, employee morale, or quality of work life 10. Performance appraisal • Fair and accurate appraisal of employee performance Steps in Job Analysis Slide 5 Phase 1: Preparation Slide 6 Phase 2: Collection of Information Slide 7 Phase 3: Use of Information Slide 8 Job Description Slide 9 Job Specifications Slide 10 Job Performance Standards Slide 11 Competency Models Slide 12 Job Design: Key Considerations Slide 13 Organizational Considerations Slide 14 Ergonomic Considerations Slide 15 STEPS IN JOB ANALYSIS PHASE 1: PREPARATION FOR JOB ANALYSIS 1. Familiarization with the Organization and Its Jobs • Before studying jobs it is important to have an awareness of an organization’s objectives, strategies, structure, inputs, and desired outcomes -- Unionized organizations require that job analysis steps meet the provisions of the collective agreement -- May also study industry and government reports about the jobs to be analyzed 2. Determine uses of Job Analysis Information • Job analysis plays a critical role for many HR functions -- Important to determine specific objectives, e.g., selection, training, designing performance appraisal and compensation systems 3. Identify Jobs to be Analyzed • Due to resource and time constraints need to determine jobs that are targets for job analysis, e.g., jobs that are critical to the success of an organization, jobs that are difficult to learn PHASE 2: COLLECTION OF JOB ANALYSIS INFORMATION 4. Determine Sources of Job data • Human sources -- Job incumbents, supervisors, job experts, work colleagues, subordinates, customers • Non-human sources -- Existing job descriptions and specifications, equipment design blueprints, equipment maintenance manuals and records, training and safety manuals, organization charts and other company records, National Occupational Classification, videos, professional journals, Internet 5. Data Collection Instrument Design • Job analysis schedules -- Checklists that seek to collect information about jobs uniformly -- Questionnaires are used to uncover the duties, responsibilities, human characteristics and working conditions, and performance standards of the investigated jobs -- Various standardized forms are available for job analysis including Functional Job Analysis, O*NET, Fleishman Job Analysis System, Position Analysis Questionnaire, and Critical Incident Method, with FJA and the PAQ as particularly popular. 6. Choice of Data Collection Method There is no best way to collect job analysis information. Trade-offs between time, cost and accuracy are associated with each method • Interviews -- Slow and expensive, however, it allows the interviewer to explain unclear questions and probe into uncertain answers • Focus Groups -- Allow the ideas of 5 to 7 people knowledge about the job to build off of each other during a 1 to 2 hour session • Mailed questionnaires -- Allows many jobs to be studied at once, at little cost, however there is less accuracy due to incomplete responses, misunderstood questions and unreturned questionnaires -- Electronic surveys are increasingly used • Employee log -- Can be quite accurate, however they are not a popular technique as they are time-consuming, and may be viewed as a nuisance resulting in resistance and declining accuracy over time • Observation -- Slow, costly and potentially less accurate, however, may be necessary when language barriers exist or to confirm results of other methods • Combinations -- Often two or more techniques are used concurrently to ensure high accuracy at minimum cost PHASE 3: USE OF JOB ANALYSIS INFORMATION The information collected about various jobs is put into usable forms including: -- job descriptions -- job specifications -- job performance standards -- competency models JOB DESCRIPTION A recognized list of functions, tasks, accountabilities, working conditions, and competencies for a particular occupation or job • Job identity -- Includes job title, job location, job code, job grade, and status • Job summary and duties -- Summary is a narrative that concisely summarizes the job -- Duties and job responsibilities are clearly stated • Working conditions -- Description of the physical environment, hours of work, safety and health hazards, travel requirements etc. • Approvals -- Reviewed for accuracy by selected jobholders and supervisors JOB DESCRIPTIONS VS. SPECIFICATIONS • The difference between a job description and a job specification is one of perspective. -- Job description defines what the jobs does--profile of the job -- Job specification describes what the job demands of employees who do it and the human factors required. It is a profile of the human characteristics needed by the job. These requirements include experience, training, education, physical demands, and mental demands JOB SPECIFICATIONS A written statement that explains what a job demands of jobholders and the human skills and factors required • Should include specific tools, actions, experiences, education and training -- Includes clear behaviour statements, e.g., “lifts 40-kg bags” JOB PERFORMANCE STANDARDS The work performance expected from an employee on a particular job • Standards become objectives or targets for employee efforts • Criteria against which job success is measured • Sources of standards include: -- Job analysis information • Alternative sources: -- Work measurement--methods for evaluating what a job’s performance standards should be, i.e., the normal performance of average workers. May involve use of historical data, time studies and/or work sampling -- Participative goal-setting--process of goal setting where managers develop performance standards through discussion with subordinates COMPETENCY MODELS • Competency-based job descriptions and specifications have become increasingly popular -- Competency is a knowledge, skill, ability, or behaviour required to be successful on the job -- competencies are broader in scope than KSAOs e.g., problem solving, communication, leadership -- a competency framework describes a group of competencies required in a particular job, most jobs have between 10 and 15 -- key differences include: competencies may be job spanning, they may vary in importance across job roles (as seen in competency matrices), and they contribute to the success of the organization in addition to success on the job JOB DESIGN Key Considerations in Job Design: • Organizational Considerations -- Efficiency: Stress efficiency in effort, time, labour costs, training, and employee learning time. Includes principles of scientific management and industrial engineering -- Work Flow: Sequence of and balance between jobs in an organization • Ergonomic Considerations -- Focuses on how human beings physically interface with their work. -- Multi-disciplinary using principles from biology (anatomy and physiology), the behavioural sciences (psychology and sociology), and physics and engineering -- Focuses on fitting the task to the worker in many instances rather than simply forcing employees to adapt to the task -- Can lead to significant improvements in efficiency and productivity (Saturn) and are also important to maintain safety at the workplace (aging workforce issues) Employee Considerations Slide 16 Optimal Job Specialization Slide 17 Increasing Quality of Work Life Slide 18 Environmental Considerations Slide 19 Meeting Job Analysis Challenges Slide 20 Employee Considerations -- Autonomy: Independence, having control over one’s work and one’s response to the work environment – Variety: The worker has the opportunity to use different skills and abilities, or perform different activities -- Task Identity: The feeling of responsibility and pride that results from doing an entire piece of work, not just a small part of it -- Feedback: Information that helps employees evaluate the success or failure or an action or system -- Task Significance: Knowing that the work one does is important to others in the organization or to others HOW MUCH JOB SPECIALIZATION IS OPTIMAL? As jobs become more specialized, productivity climbs until behavioural elements such as boredom offset the advantages of further specialization Specialization Advantages • Specialization increases productivity to a certain point • Specialized jobs take less time to learn, frustration is decreased and feedback is increased • Provides jobs for workers with limited skills Specialization Disadvantages • Employee satisfaction drops and boredom causes errors or resignations to occur • Routine jobs hold less appealing to educated or affluent workers INCREASING QUALITY OF WORK LIFE • Job Rotation -- Moving employees from one job to another to provide more variety and to learn new skills • Job Enlargement -- Expanding the number of related tasks in a job to increase the job cycle and draw on a wider range of employee skills • Job Enrichment -- Adding more responsibilities and autonomy to a job, giving the worker greater power to plan, do, and evaluate job performance • Employee Involvement and Work Teams -- Work is increasingly being organized around teams and processes -- Self-managed and autonomous work teams are increasingly used ENVIRONMENTAL CONSIDERATIONS • Workforce Availability -- Efficiency considerations must be balanced against the abilities and availability of the people who perform the work • Social Expectations -- The acceptability of a job’s design is influenced by the expectations of society and workers • Work Practices -- Set ways of performing work arrived at from tradition or from the collective wishes of employees JOB ANALYSIS IN TOMORROW’S “JOBLESS” WORLD Global competition, changing technology and worker profiles and rapid increases in knowledge requirements for many jobs have made accurate and timely job descriptions difficult. • To meet these challenges one possibility is a future-oriented style -- When describing job activities and specifications i.e. focus on both present and future requirements • Job analysis will continue to be relevant for legal compliance purposes ANSWERS TO REVIEW AND DISCUSSION QUESTIONS 1. Suppose you work for an organization that does not collect job analysis. What arguments will you make to introduce it? What methods of collecting job analysis information will you recommend and why? Job analysis information is needed to help design jobs necessary for an organization to be productive. The job analysis information is used to write a job description and job specification, and is the basis for HR strategy and functioning. An improvement in the task definition will result in greater productivity and profits. Figure 2-1, p. 52, gives the major HR activities that rely on job analysis information. The choice of job analysis methods depends on the specific HR goals (see Figure 2-5, p.60). For example, interviews and questionnaires are best suited for designing a compensation system, while interviews and employee logs are best suited for employee counselling. 2. Define job descriptions and job specifications, illustrating how the two are related, yet different. Job descriptions indicate what the duties, activities, and responsibilities of jobs are. Job specifications outline the human characteristics needed to perform the job successfully. Both rely on the Job Analysis for their information. 3. Why are clear job specifications important? What are the costs of imprecise specifications? Well-developed job specifications inform HR planners, recruiters, and interviewers what to look for. Lacking clear job specifications, planners, recruiters, and interviewers have to rely on guess work, resulting in poor employee–job match. 4. How can performance standards be set for production jobs when job analysis information is insufficient? How would you set standards for a research scientist if you were chief scien¬tist? Performance standards on production jobs can be set in a variety of ways. Historical data can be used to determine what actual performance has been and that figure can serve as a standard, particularly in stable work environments with little technologi¬cal change. Time study can be used by studying the time it takes to do individual tasks. These tasks are timed repeatedly using the standard method to arrive at the rated job time. To this figure allowances are added for production delays, breaks, and other nonproductive time to determine the standard time for the job. With this time figure known, analysts can compute the stan-dard output. In setting the standards for a research scientist, the chief scientist probably would want to use some form of participative goal setting. Under this approach the scientists discuss the job and the subordinate suggests likely standards. After review and discussion with the chief scientist, these standards are modified to the point that the standards are realistic and accepted. 5. What factors need to be considered when redesigning jobs? Of these, which is (are) most important? The factors to consider are efficiency, workflow, ergonomic considerations, employee considerations, autonomy, variety, task identity, feedback, and task significance. While efficiency is important, the needs of employees as well as environmental realities also affect job redesign efforts. . ANSWERS TO CRITICAL THINKING QUESTIONS 1. Suppose you were assigned to write the job description in a shirt factory in British Columbia employing mostly Chinese immigrants who spoke little English. What methods would you use to collect job analysis data? Perhaps the best approach is by direct observation. From observa¬tions, the analyst can complete the job analysis schedule and write up a job description. The job description then can be checked with the supervisor to ensure that no important aspects of the jobs are overlooked. 2. You work in the human resource department of a large brewery in Atlantic Canada. You are in the process of writing job descriptions for all managerial and supervisory staff. One manager who is in the production division of the brewery refuses to complete a job analysis questionnaire. (a) What reasons would you use to persuade that individual to complete it? The best approach is to explain how the data is to be used. Most managers want the human resource department to do the best job it can during recruiting, compensating, training, and other human resource activities. The analysts might be able to convince the manager that a lack of completed job descriptions will reduce the level of service the department can provide this and other manag¬ers. (b) If, after your best efforts at persuasion failed, you still wanted job analysis information on the manager's job, how would you get it? Direct observation might be a good start. It can identify many of the activities and the proportion of the manager's time each took. Discussions or completed questionnaires by other managers who did similar work can provide further insight. Finally, the manager's superior can be asked to complete a questionnaire about the subordinate manager's job. 3. Suppose you have been assigned to design the job of ticket clerk for a regional airline in Ontario. How would you handle the following trade-offs? (a) Would you recommend highly specialized job designs to mini¬mize training or very broad jobs with all clerks cross-trained to handle multiple tasks? Why? (b) Would you change your answer if you knew that employees tended to quit the job of ticket clerk within the first six months? Why or why not? Since airline ticket clerks often face bursts of activity just before a plane arrives followed by periods of relative calm, it would seem advisable that each clerk be fully cross-trained to handle the peak workload. However, if employees who were fully cross-trained tended to quit in a short time, the airline might be better off training people in only narrow specialties. The more specialized jobs would require less training and take less time to master at a satisfac¬tory level of performance. Although this may create some conges¬tion at the time of check-in, the airline's loss of people would not be as costly and replacements could be trained quickly to fill in highly specialized jobs that become vacant. 4. Assume you are told to evaluate a group of jobs in a boat-building business. After studying each job for a considerable amount of time, you identify the following activities associated with each job. What job-redesign techniques would you recommend for these jobs, if any? (a) Sailmaker. Cuts and sews material with very little variety in the type of work from day to day. Job is highly skilled and takes years to learn. (b) Sander. Sands rough wood and fibreglass edges almost contin¬uously. Little skill is required in this job. (c) Sales representative. Talks to customers, answers phone inquiries, suggests customized additions to special-order boats. (d) Boat preparer. Cleans up completed boats, waxes fittings, and generally makes the boat ready for customer delivery. Few skills are required for this job. The sailmaker's job is probably viewed as a craft. To make the job more specialized might deprive the sailmaker of variety in types of sails or reduce the amount of task identity. The sander has a boring job that is physically demanding. Since it is easy to learn, rotation with the boat preparer's job may add variety, and reduce boredom and fatigue. Job rotation and possi¬bly some job enrichment (e.g., checking for quality) may improve it. Sales representatives normally have a job with a high degree of variety, task identity, autonomy, and feedback. The job probably could not be specialized, and there is probably little need to expand the job through the addition of other behavioural princi¬ples. The boat preparer's job probably could be expanded through job rotation (perhaps with the sander). Also, this employee could be made a "troubleshooter" and do the final quality control check. 5. What are the key performance dimensions of the instructor who is teaching this course? How will you go about setting perfor¬mance standards for the individual? Establish performance standards and associated time-bound, specific objectives in any of two areas of your choice. The Figure "Competency Model for a University Instructor" below provides guidelines for establishing suitable performance dimensions. Students can download this Figure from the book's Online Learning Centre http://www.mcgrawhillconnect.ca For developing performance standards, the dean of faculty may want to use some form of participative goal setting. ETHICS QUESTION Comments to Instructors There is no right or wrong answer to this question. It is for class discussion purposes. WEB RESEARCH Comments to Instructors These exercises have been designed for students to demonstrate their computer and Internet skills to research the required information. Answers will vary INCIDENT 2.1: HILLARY HOME APPLIANCES CORPORATION Incident Comments This incident illustrates the necessity of performing a job analysis to help redesign the jobs to improve productivity. HR plays a key role in job analysis and job design to improve productivity. 1. What prompted the HR manager to make the statement? The HR manager realized that productivity was suffering. To improve productivity, there needs to be a job analysis to redesign jobs. By redesigning the jobs, both performance and morale can be improved. 2. If you were the HR manager, what arguments will you provide to convince the two supervisors of the desirability of job analysis and employee involvement teams? Job analysis provides the necessary information to the managers to plan for future HR requirements and help determine training needs. Greater employee involvement will help motivate employees to work on their own. It can reduce monotony while create a greater sense of task significance to the team members. EXERCISE 2-1: A GOOD WORK ENVIRONMENT Comments to Instructor Most students will have had some work experience and will be able to list some work-related enjoyable situations. Answers will vary. CASE STUDY: MAPLE LEAF SHOES LTD. - AN EXERCISE IN JOB ANALYSIS Answers to Discussion Questions 1. What is your evaluation of Lance's approach to the project? The major positive point is that Lance made an attempt to inter¬view all the senior managers of the organization (although he did not succeed in this). Some of the questions used by Lance also are proactive in tone (e.g., “What are the major challenges facing Maple Leaf Shoes in the next five years?”). He also seems to be working under the assumption that for a human resource department to be effective, it should meet the expectations of its clients (in this instance, other managers, decision makers, and staff). The use of personal interviews should help to gather “rich” information (as opposed to merely large “chunks” of information). This is because other nonverbal cues and symbolic gestures can give additional insights into the respondent's frame of mind. However, Lance's approach has more weaknesses than strengths. The student may point out a number of theoretical and methodolog¬ical flaws in Lance's approach. The following are given as sample items: • The question checklist used by Lance is too short and does not give much insight into the human resource function. • The free-response format used by Lance for all questions makes the responses incomparable with each other. Thus, forming any overall conclusion on any of the questions may be hard. • Several job analysis steps listed in Figure 2-2, p. 50, have not been followed. • Only three out of five managers responded; the interview with Clark seems useless given the number of interruptions and his nonfamiliarity with the day-to-day challenges facing the human resource manager and the staff. • Lance didn't meet with subordinates (a major “customer” of human resource management), unions, and the large number of people who work outside head office. • Apparently Lance has no plan to look at the records of the company to gain insights into the past practices. • At the end of the three interviews, Lance still does not have any clear idea of job duties, performance stan¬dards, criteria for evaluating the effectiveness of the human resource department function in this organization, and physical and other special attributes needed for the human resource manag¬er. At this point, the instructor may want to ask students what conclusions they can form based on the three interviews. While there may not be complete agreement among the members of the class, the following may emerge as some tentative conclusions: • The human resource department (HRD) at Maple Leaf shoes has not contributed much to job design, organizational planning and change, or employee planning. • Controlling the cost of production is a high priority in this firm if it is to prosper (and even to survive in the long run). • Unions in the organization are getting increasingly mili¬tant, and dealing with them is an urgent priority for the new human resource manager. • Several members of the company have a poor, negative, or low opinion of the human resource department; until now the human resource department in the firm has played a low-key, record-keeping role (poor cousin image?). • There is a need to establish more systems and procedures covering various aspects of staff management. • Human resource department staff strength at Maple Leaf, in comparison to other similar-sized organizations, seems low. • Those pieces of information are important; however, these by themselves are inadequate for the purpose of designing job de¬scriptions and specifications and identifying performance stan-dards. 2. What would you do if you were in Lance's position right now? Interviews are useful; however, a greater number of them need to be done, especially with all categories of employees, union officials, customers, colleagues, and subordinates of the human resource manager. Staff in other regions should also be contacted either through mail questionnaires or telephone interviews. The latter might be more expensive although it will increase the response rate. A combination of the two (that is, a mail questionnaire followed by a telephone reminder or follow-up) may be a good approach as it can protect the anonymity of the respondent and lead to more frank responses. A longer and more exhaustive interview schedule should be designed focusing on, among other things: • What is the purpose of the job? • What is being done currently? • How work is being done currently? • What are the primary duties? • What are the other duties? • What constitutes successful performance of duties? • What constitutes acceptable performance of duties? • How much training is needed for these duties? • What are the human resource manager's responsibilities? • What physical and human attributes are critical and desir¬able for the position (e.g., initiative, attention, judgment)? • Is experience important for the job? • Can training be substituted for experience? • What are some unusual psychological and other demands on the human resource manager? Past human resource department records should be looked at to gauge the effectiveness and gaps in performance of the human resource department; these could give some insights into the responsibilities of the position. For example, the union may be able to provide information on the number, type, and seriousness of employee grievances in the past; details of safety violations may also be available from the company itself or by contacting the local government agencies. Employee turnover, absenteeism, and productivity data should give some indications to the re¬searcher about the magnitude of the challenge awaiting the new human resource manager. Publications such as NOC, human resource magazines and reports, the job descriptions of human resource management in other similar organizations, etc., may also give additional insights into what is being done elsewhere and what should be added to the responsibilities of the human resource manager at Maple Leaf Shoes (subject to organizational goals and resource constraints, of course). While interviewing managers and staff, ask for past critical incidents reflecting effective or ineffective human resource management. This could help in attempting to identify job specification and performance standards. It may be useful to introduce the notion of job competencies to Maple Leaf Shoes, which would require the analysis of characteris¬tics of high performers. CASE STUDY: CANADIAN PACIFIC AND INTERNATIONAL BANK - REDEFINING JOBS FOR FUTURE Answers to Discussion Questions 1. Assume that you are invited as a consultant by CPIB. What procedures would you introduce that would ensure that the restudied job information was correct? A variety of job analyses can be used to verify that the changed job descriptions are accurate. Through use of electronic questionnaires, the job incumbents can be surveyed periodically to determine what aspects of the existing job description is inaccurate and why there are different views of their jobs. Differences may be due to differing expectations between CPIB and former CCTC employees. To check whether the job information is correct, the jobs could be studied by job experts through observations and interviews. Work colleagues and customers could also be interviewed individually or in groups to determine if the information is accurate. 2. Given the ability of most managers to “communicate” directly with the computer, can CPIB use this to its advantage in collecting job analysis information? CPIB can computerize the collection of the job analysis data. Both existing job descriptions and specifications can be posted on the Intranet within CPIB. As well, a job analysis questionnaire, like Figure 2-4, p. 56-58, can be completed through the computer by the job incumbents. This would also make it easier to analyze and compare the survey results, and can be more readily adopted to usable forms such as job descriptions and job specifications. 3. What additional skills and competencies would you focus on while planning a training program for CCTC staff? How should CPIB establish performance and skill standards for CCTC staff? Traditional job specifications focus on competencies associated with high job performance. Competencies relevant to the CCTC staff also would include problem solving, analytical thinking, and leadership. Broader conceptualizations of competencies include beliefs and values. For the CCTC staff, an important competency is the degree to which their values are compatible with that of CPIB. For the CCTC staff, the performance standards can be established through work measurement and participative goal setting. Based on their job description, work measurement can be based on historical data, time study, and/or work sampling. Where the tasks do not have obvious standards, participative goal setting can be used. Employees at CCTC can gain insight on CPIB’s expectations and rewards can be tied to the meeting of these performance goals. Solution Manual for Canadian Human Resource Management: A Strategic Approach Hermann F. Schwind, Hari Das, Terry H. Wagar, Neil Fassina, Julie Bulmash 9780071051552, 9781259066665