Chapter Planning for Human Resources © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved Chapter Outline • 3-1 Gaining Competitive Advantage • 3-2 HRM Issues and Practices 3-3 The Managers Guide â 2010Cengage Learning.Atomic Dog is a trademark used herein under license All rights reserved 3-1a Opening Case: Gaining Competitive Advantage at General Motors • Problem: Time spent on completing HR transactions hurts employee and HR productivity • Solution: Developing an employee services center website • How the employee services center enhanced competitive advantage: Significant reduction is cost and time Improvement in speed and quality of employee work Improvement in the productivity of HR department © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-1b Linking Human Resource Planning to Competitive Advantage • HR planning: Process of identifying and responding to organizational needs and charting new policies, systems, and programs that will assure effective human resource management under changing conditions • Objectives of HR planning Enable organizations to anticipate their future HRM needs Identify practices that will help them meet those needs © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-1b Linking Human Resource Planning to Competitive Advantage (cont.) • HR planning ties together all human resource activities and integrates these with the rest of the organization • It enables companies to gain control of their future by preparing for events that are likely to occur © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-1b Linking Human Resource Planning to Competitive Advantage (cont.) • Consequences associated with the failure to plan for human resources Employers are forced to respond to events after they occur; that is, they become reactive, rather than proactive An organization may be unable to correctly anticipate an increase in its future demand for employees, leading to understaffing Understaffing leads to consequences such as increased stress levels, increase in back orders, decrease in customer goodwill, an increase in competition, and a loss of market share © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-2a Strategic Planning • Through the strategic planning process, organizations determine where they are going • The process consists of the following activities: Determine the organizational mission Scan the organizational environment Set strategic goals Formulate a strategic plan, part of which addresses human resource needs © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-2a Strategic Planning (cont.) • Determine the organizational mission Mission statement is a declaration of the organization’s overall purpose It defines the basic business scope and operations that distinguish the organization from others of a similar nature © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-2a Strategic Planning (cont.) • Scan the organizational environment External and internal environments must be scanned to identify threats and opportunities External environment: Includes political, legal, economic, social, and technological issues; the industry environment must also be scanned Internal environment: Assessment of the firm’s strengths and weaknesses in order to form strategic goals that take advantage of strengths The task of gathering information for strategy formulation rests with all managers and employees © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-2b Human Resource Planning (cont.) • Precaution regarding the use of statistical methods Statistical methods of demand forecasting assume that the relationship between workforce size and the business factor remains constant over time If this relationship were to change unexpectedly, the forecast would become inaccurate © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-2b Human Resource Planning (cont.) • Judgmental approaches Involves the use of human judgment, rather than a manipulation of numbers Two most common techniques: - Group brainstorming Sales force estimates © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-2b Human Resource Planning (cont.) • Supply forecasting: The process used to estimate which positions will be filled at a particular point in time • Steps to supply forecasting Step 1: Organization groups its positions by title, function, and level of responsibility Step 2: Estimate within each job group, how many of its current employees will: - Remain in their positions during the planning period How many will move to another position How many will leave the organization © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-2b Human Resource Planning (cont.) • Estimating future human resource needs A firm derives its specific staffing needs by combining the results of the supply and demand forecasts within each job group © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-2c Outcomes of the HR Planning Process • Dealing with an oversupply of employees The current trend toward organizational restructuring usually results in a smaller workforce When an organization’s strategic plan calls for restructuring, the HRM response is usually one of downsizing - Downsizing usually means layoffs Because of the negative outcomes that are often associated with layoffs, employers are encouraged to seek alternatives © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-2c Outcomes of the HR Planning Process (cont.) • Dealing with an undersupply of employees Hiring additional workers Alternatives to additional hiring - Improve productivity of existing workforce through additional training Overtime Additional shifts Job reassignments Temporary workers Improve retention rates © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-2d Human Resource Information Systems • Human Resource Information Systems (HRIS): A computerized information package that provides management with increasing capacity to record, store, manipulate, and communicate information across wide geographic boundaries, with access to many users © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-2d Human Resource Information Systems (cont.) • An HRIS contains information about: A company’s jobs - Number and types of jobs Number of people needed in each job Qualifications needed to perform each job A company’s employees - Individual’s equal employment opportunity classification Date of hire Salary history Performance ratings © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-2d Human Resource Information Systems (cont.) • Purposes served by HRIS Handles most of the record keeping done by HR professionals Reduces paperwork and cuts administrative costs Organizational members outside the HRM department can more easily access the information Store information essential for filling vacant positions © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-2d Human Resource Information Systems (cont.) • HRIS on the “Net” – Intranet • Internet networks that are accessible only to employees within the company They can store a great deal of HR information It allows companies to save money by eliminating printing and distribution costs Employees like it because it allows them to quickly and privately access HR information HRIS on the “Net” – Extranet Link a firm's intranet to a variety of outside organizations and vendors Gives employees secure access to information and services from outside parties © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-2d Human Resource Information Systems (cont.) • Ensuring the confidentiality of HRIS information The organization must ensure that user access is limited to relevant information - Sensitive and confidential information should only be accessible by the HRM department or specified individuals Institute strong written policies that stipulate the organization’s intention to protect employee privacy rights © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-3a HR Planning and the Manager’s Job • Line managers: • Formulate goals for their units Develop strategies for meeting those goals Formulate individual performance goals Staffing: Ensure that work unit is properly staffed at all times Forecast the volume of work to be completed Devise a work schedule Schedule overtime and vacations Adjust work schedules in “emergency” situations Request authorization to create new positions, if needed © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-3a HR Planning and the Manager’s Job (cont.) • Employee retention Line managers’ style of management can have a major impact on a subordinate’s decision to remain with the company Managers must be able to establish good working relationships with their employees by treating them in a fair and consistent manner, while exhibiting concern for their well-being Managers must also be effective teachers, motivators, and communicators © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-3b How the HR Department Can Help • HR professionals’ plans must be aligned with changes spurred by the organization’s strategic plan The plan may call for such interventions as: • Greater flexibility in the workplace Greater rigor in training Increased responsibilities for management Increased worker participation The use of performance incentives Analysis and measurement of the work of the HRM department should be ongoing © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved 3-3c HRM Skill-Building for Managers • Information regarding the future needs and workforce demands of the unit will better enable the HRM department to help identify, select, and train current and future workers as needed • Not all departments have the same needs for human resources; the functional managers must work together to develop a comprehensive plan • The most direct approach to getting this information is to meet with an HR professional, top managers, and other line managers on a regular basis, at least semiannually © 2010 Cengage Learning. Atomic Dog is a trademark used herein under license All rights reserved ... basis of certain business factors - A business factor is an attribute of the business such as sales volume or market share, which closely relates to the size of the needed workforce Is used... license All rights reserved 3-2b Human Resource Planning (cont.) • Trend analysis: Future demand for human resources is projected on the basis of past business trends regarding a business factor •... an increase in its future demand for employees, leading to understaffing Understaffing leads to consequences such as increased stress levels, increase in back orders, decrease in customer goodwill,