Unit 16 Human Resource Management in Business - mrSIDHOM.COM

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Nov 20, 2013 (3 years and 28 days ago)

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Unit 16

Human Resource Management in
Business

Mr Sidhom

Unit introduction


Human resource management is a dynamic activity in any
organisation as it takes place against a changing economic,
technical, legal and social background.



It is important for learners to appreciate that effective human
resource management means getting the best out of the
people who work for an organisation in order to ensure the
organisation fulfils its purposes, whether it is a football club
winning the premiership, or a hospital increasing the success
rates for medical operations.


On completion of this unit you
should:

1.
Know the factors that are involved in human resource
planning in organisations


2.
Know how organisations motivate employees


3.
Understand how to gain committed employee cooperation


4.
Understand the importance of managing employee
performance at work.


Scenario


You are employed in the human resources department of a large IT
consultancy. The business is involved in several large
-
scale projects for
private and public sector clients. Working in IT systems design, planning
and delivery, the consultancy requires people with specific technical
skills. These need to be combined with an ability to work well within
teams, and to work flexibly in a fast
-
changing environment. The
consultancy has recently won a new IT project with a national
government agency. The project will be staffed by some people already
employed in
-
house, but a new recruitment drive will be needed.



This success coincides with an internal review of the HR function so your
line manager,
Reuban

Agboola
, feels this is a good time for serious
investigation of HR. You and
Reuban

are both going to attend a local
partnership meeting which will be attended by representatives from the
local authority, the regional development agency, the Learning and Skills
Council and others. He has volunteered to do a presentation about how
the IT sector is coping with the local labour market and he has asked
that you to prepare some material on HR that can be handed out at the
meeting.



Assignment
1
:

Acquiring
and retaining staff

Assignment 1: Acquiring and retaining staff

P
1
:

Describe

the

internal

and

external

factors

to

consider

when

planning

the

human

resource

requirements

of

an

organisation


M
1
:

explain

why

human

resources

planning

is

important

to

an

organisation


P
2
:

describe

how

the

employee

skills

required

to

do

the

jobs

in

an

organisation

are

identified


P
3
:

Outline

how

an

organisation’s

motivational

practices

and

reward

systems

are

informed

by

theories

of

motivation


M
2
:

compare

the

use

of

motivation

theories

in

an

organisation


D
1
:

suggest,

with

justifications,

ways

of

improving

motivation

in

an

organisational

setting



P1: Describe the internal and external factors to consider when
planning the human resource requirements of an organisation


a)
Create a leaflet that describes the main internal and external
factors which must be considered when an organisation is planning
its HR requirements. Use images and diagrams if you wish.


Internal planning factors:
organisational needs
eg

demand for products
and services, new products and services, new markets, technological
change, location of production; skills requirements; workforce profiles
(age, gender, ethnicity, ability)


External planning factors:
supply of labour (international, national,
regional, local, long
-
term trends, short
-
term trends); labour costs;
workforce skills; government policy; labour market competition;
changing nature of work; employee expectations
eg

full
-
time, part
-
time,
permanent, temporary, casual work; impact of automation; demand for
products and services


Sample answer

All organisations need to consider their human resources needs because it is impossible to deliver a business strategy
unless there are staff in place with the right combination of skills and aptitudes. In order to do this, HR planning must
take place. There are many factors to be taken into account.



Internal factors in HR planning


Organisational needs

These are usually governed by the demand for products and services. A business might decide to alter production
from one product to another so that it can target a new market. This may produce a need for staff with new, or
different, skills and knowledge. Existing staff might be able to retrain to acquire the new skill. This is a responsibility o
f
the HR department and must be a part of the plan. For a business that delivers a service, the same applies. Changes in
demand for a service cause new skills to be required.


Technological changes

Technology changes all the time. This covers office equipment, computers and software, as well as the technology
used in production. The point is that technological change can require staff to retrain or update their skills. It is poor
management practice to acquire new technology without establishing that staff can use it. Location of production A
decision to relocate requires considerable planning. For example, some time ago, the Civil Service decided to relocate
some government offices from London to north
-
east England. Staff considerations formed a major part of the
planning. Would staff be willing to move from London? Would people in the area have the right skills to fill any
vacancies?


Workforce demographics

Another factor impacting on HR planning is the current profile of the workforce. If many staff are nearing retirement
age, or if there is a substantial gender or racial imbalance, then the organisation may need a recruitment programme.


Sample answer

External factors in HR planning


Supply of labour

HR planners must take account of the local labour market. A business must be able to recruit staff
with the necessary skills, abilities and aptitudes. This is crucial


most jobs require a range of
specialist skills, there are few unskilled jobs available. So HR planners need to know how many
people in the local labour market have the skills the business needs? Planners must also consider
demographics. Is the local workforce growing or in decline? What is the age structure of a workforce?


Cost of labour

This is a crucial area. Today, UK businesses face international competition from companies located in
countries with lower staff costs. For companies with global operations, it can be quite an easy
decision to relocate production to regions where labour is cheaper. This was the main reason why
Electrolux closed its factory in Durham, and moved production to Poland (see case study 1).


Government policy

All HR planners must take government policy into account, particularly in relation to national
insurance, taxation, contracts and employment law. Businesses considering relocating or starting
operations in a new area will want to know the government’s regional policy. Will government
(national and local) be supportive of any move?


Changing nature of work

People today want their work to be balanced with their family life. Companies wanting to attract
high
-
calibre staff may need to offer terms and conditions that reflect this desire.


M1: explain why human resources planning is
important to an organisation

(b)

Add a separate section to your leaflet that fully explains

why HR planning is important to an organisation.



Employee skills:
people as organisational resources; skill sets
eg

job specific, generic; skill acquisition; skills audit, skill
transferability; impact of technology



P2: describe how the employee skills required to do
the jobs in an organisation are identified

Now produce further background material for the
presentation.


(a)
Take four different jobs that exist within an
organisation. Create a brief written summary of the
various skills (such as numeracy, IT, people skills)
needed to do these jobs.


(b)
Draw up a diagram such as a flow chart to show how
the organisation identifies that these skills are required
in a job role. Use illustrations to show any
documentation that could be used.


Sample answer

Here is an outline structure for the presentation.


Slide 1


What is motivation? Why is it important?

Slide 2


Motivation theory: the old approach

Taylor’s approach: more pay leads to more work

Slide 3


Motivation theory: newer approaches

Slide 4


Maslow

Slide 5


Herzberg

Slide 6


Vroom

Slide 7


McGregor

Slide 8


McClelland

Slides 9 & 10


How these ideas can be implemented in an
organisation


How do organisations put these approaches into practice?


P3: Outline how an organisation’s motivational practices and
reward systems are informed by theories of motivation

HR managers are looking at ways of ensuring that the IT consultancy
continues to attract the very best candidates including the top graduates
from HE institutions. The policy is to attract, retain and develop the best
staff.


Create a presentation to describe at least four theories of motivation.
Outline how the organisation’s motivational practices and reward
systems can be informed by these theories.


Motivation theory:
theories of motivation
eg

Taylor, Mayo, Maslow,
Herzberg, McGregor, McClelland, Vroom


Reward systems:
pay; performance
-
related pay; pension schemes; profit
sharing; employee share options; mortgage subsidies; relocation fees;
bonuses; company vehicles; loans/advances; childcare; school fees;
corporate clothes; staff discounts; flexible working; leave; health care;
extended parental leave, career breaks; cafeteria incentive schemes; salary
sacrifice schemes


M2: compare the use of motivation theories in an organisation


Now extend the presentation you prepared in task 3 by
investigating the use of motivational theories in a real
organisation. You can choose any organisation that you are
familiar with. (It does not have to be an IT consultancy.)


(a)
Compare
the use of motivation theories in the organisation
you choose to investigate
.



D1: suggest, with justifications, ways of improving motivation
in an organisational setting

(b)
Suggest
, with justifications, ways of improving employee




motivation
within this organisation
.



Sample answer
f
or M2 and D1

Motivation in practice


A study of how one organisation seeks to motivate its employees. A set of slides
that address these questions.

1.

Does the organisation empower workers?

2.

Does it listen to them?

3.

Are workers allowed to contribute?

4.

Do managers encourage feedback?

5.

Does the business have different reward systems for particular groups of

staff
?

6.

Does the business encourage social interaction?

7.

What is the structure of the business?


How
can this practice be improved? Ideas for how this organisation can improve
employee motivation and raise morale might include introducing or enhancing:

1.

worker councils

2.

work teams

3.

rewards for performance

4.

consultation

5.

flexible work patterns.


Assignment 2:
Employee performance

Mr Sidhom

Assignment 2: Employee performance

P4

Describe how organisations obtain the co
-
operation of
employees through the contract of employment and employee
involvement
techniques


P5:
describe how employee performance is measured and
managed


M3:
explain how the results from measuring and managing
performance inform employee
development


D2:
assess the importance of measuring and managing
employee performance at work


P4 Describe how organisations obtain the co
-
operation of employees through the contract of
employment and employee involvement techniques

(a)
Set
out


in the most appropriate format


the contents and purpose of a
contract of employment. If you are able, provide some examples with your
answer.


(b)
Outline
the various ways in which an organisation such as the IT consultancy can
involve employees in the
business
. For example, you might consider things like staff
newsletters
.



Contracts of employment:
contractual entitlements (pay, hours of work, leave, notice
period, pension benefits); employee and employer rights; types of employment contract
(full time, fractional, part time, temporary, casual); disciplinary procedures; grievance
procedures; union membership; codes of behaviour


Employee involvement techniques:
membership of work groups
eg

board, works
councils, quality circles, intra
-
organisational groups (transnational, national, site
specific); suggestions schemes; devolved authority and responsibility; open
communications (formal, informal, top
-
down, bottom
-
up, lateral); types of
communication (newsletters, company bulletins); organisational culture (ethos, values,
mission); national accreditation (Investors in People (IIP), Charter Mark, International
Standards Organisation (ISO))


Sample answer for P4 (a)

Gaining employee co
-
operation through the contract of employment


A
contract of employment is an agreement between employer and employee. It establishes
rights and duties of both parties


these are called the terms of the contract.


[Learners could provide examples of specific terms here from a real employment context.]


The main terms of contracts of employment usually include:

1.

hours of work

2.

pay

3.

sick pay arrangements

4.

disciplinary or grievance procedures

5.

period of notice.


Employees are entitled to a written statement of the main terms of employment within eight
weeks of starting work.


The terms of a contract bind both parties. These cannot be changed unless the employee
resigns, or there is a mutual agreement to change them. How does this help to assure co
-
operation of employees? Because employees commit to the terms that are offered, this gives
the employer the right to expect staff to abide by the terms. Employers, for their part, must
follow the procedures that have been agreed, such as in relation to the period of notice.


Sample answer for P4
(b)

Gaining co
-
operation through employee involvement


The job of any manager would be impossible without a degree of staff co
-
operation. Management
decisions have an impact upon employees. Managers who take decisions in isolation and without any
consultation with their staff can often find that they have difficulty implementing these decisions
because they meet with staff resistance. The old
-
fashioned management practice tended to based on
the principle that employees should be instructed and sometimes bullied into working. They had to
‘do what they were told’. Managers took decisions without reference to staff opinion.
Communication was always top down. Today, modern managers try to seek staff views. Many
organisations create opportunities for staff to express their views and opinions.


There are several mechanisms for involving employees:

1.

work groups, such as quality circles, works councils


used to discuss particular issues

2.

suggestion schemes


these can be very successful in saving money and time, managers

offer
rewards
for
the best suggestions

3.

better communications


such as staff newsletters, the organisation’s intranet, bulletins

4.

Investors in People

5.

Charter Mark.


More fundamentally, an organisation can devolve authority and responsibility. This is sometimes
called empowerment. By enabling staff to make decisions without reference to senior managers, the
organisation hopes to speed up decision making and encourage greater employee commitment.


All this requires a positive organisational culture in which employees have a real sense of
participation and involvement. The ideal is to create a feeling among staff that their opinions and
actions really matter.



P5: describe how employee performance is measured and managed

M3: explain how the results from measuring and managing performance inform
employee development

D2: assess the importance of measuring and managing employee performance at work


This
task focuses on staff performance measurement
systems.

P5:
Prepare hand
-
outs
to describe the various ways in which staff performance can be measured.

M3:
Explain
how the results from this process can be used to plan staff development.

D2:
Assess
the importance of measuring and managing staff performance at work.


Measuring performance:
performance indicators (achievement against
targets); goal theory; SMART (specific, measurable, achievable,
realistic, time
-
bound) targets
eg

sales targets, growth targets, financial
targets, waiting times, pass rates, punctuality, attendance;
benchmarking


Managing performance:
probation; appraisal; supporting employees
eg

mentoring, monitoring, buddying; occupational health; managing
workloads; delegating authority; responsibility; capacity; competence;
autonomy; linking rewards to performance; discipline; employee
development(training, learning, job rotation, accelerated promotion,
personal, professional)


Sample answer for P5 (a)

Introduction


Staff performance is crucial to the success of an organisation. Good management is about being able to motivate staff to work

to

the best of their ability. Every employee in an organisation has a job description. However, this only sets out the responsib
ili
ties,
overall purpose and context of a job role. It helps line managers if job objectives are stated in SMART terms


that is, specifi
c,
measurable, achievable, realistic and time constrained. This provides clear targets and goals for the employee. This view has

ha
d
a huge impact on management theory (see, for example, Locke’s goal theory).

Measuring performance


This section should describe the various ways in which employee performance can be measured.


A series of specific examples could provide with appropriate commentary. These examples could include:

1.

sales targets


say, a 10% increase in sales of X by Y

2.

Financial targets


say, a 10% decrease in costs by...

3.

Growth targets


say, an increase in market share by 3% by...

4.

waiting times


in customer service situations

5.

bed occupancy


in hospitals

6.

room occupancy


in hotels

7.

pass rates, retention rates, success rates, attendance rates


in education

8.

Benchmarking against competitors.


Managing performance


This section should summarise the ways in which performance can be managed. This would include:

1.

performance appraisal (IPRs)


using targets as part of process

2.

employee support through mentoring, monitoring and buddying

3.

occupational health


in relation to issues such as stress management

4.

managing staff workloads

5.

delegating authority and responsibility


to empower staff

6.

creating reward schemes


to take account of superior performance

7.

giving autonomy


letting staff use their initiative

8.

employee development


basing this on results of the targets setting

9.

Promotion


judged on ability to meet targets.


Sample answer for
M3 (b)

How results from target and goals setting can inform staff
development


During an appraisal system or individual performance review, a line manager can
refer to the previous year’s targets and measure the extent to which they have
been achieved.


The employee can refer to the targets and offer explanations if he or she has fallen
short. In a joint review of the year’s work, the manager and employee can agree
staff development programmes that might assist. Specific examples should be
provided here from learners’ research. These might include situations in which the
employee needs:



better IT skills



financial awareness



commercial knowledge



teamwork skills, management skills, etc.


The targets that are set for training and development are agreed. If there are
problems then a programme of remedial development can be used to assist the
employee.


Sample answer for D2 (c)

Why measuring performance is
important:


A summary of the ways in which performance management
techniques could be important to an organisation should be followed
by learner judgement of whether they actually believe they are
valuable. All judgements should be justified.


They could be important because they:

1.

are a motivator for employees

2.

provide a focus for appraising staff

3.

enable managers to identify weaknesses

4.

provide a practical basis for remedial actions and staff

development

5.

give specific criteria for managers to judge performance.