Strategic Human Resource Management Chapters 7-9

Chapter 7: Orientation, Training and Development and Career Planning Onboarding- the process of integrating and acculturating new employees and knowledge to become successful and productive (includes orientation, training and development activities) Outcomes include: greater retention, faster time to productivity, increased motivation, and engagement ORIENTATION Organizational Issues- history, names and titles, overviews; policies, employee handbook Employee Benefits- pay, vacations, breaks, benefits; services, programs, counseling Introductions- to supervisor, co-workers, trainers Job Duties- job location, job overview, safety; job tasks, objectives, relationships Orientation can serve several purposes - Reduce turnover - Reduce errors - Develop clear expectations - Improve job performance - Organizational stability - Reduce anxiety - Reduce grievances - Reduce need for discipline SOCIALIZATION Socialization- the continuing process by which an employee begins to understand and accept the values, norms, and beliefs held by others in the organization. Involves turning outsiders into insiders. May have taken place even before employees join organization EMPLOYEE TRAINING Companies compete in a global economy- fast-changing environment - Global competition has forced companies to flatten structures and reduce employees - Need to foster life-long learning to attract and retain multi-skilled employees - Training is needed to work effectively with diverse employees - Developments in information technologies require new skills and training strategies THE TRAINING SYSTEM Sequence of Events- needs assessment, objectives, content, learning principles, program implementation, and evaluation Needs Assessment- diagnoses present problems and future challenges that can be met through training or development - Needs to consider each person - Need may be determined by the HR department, supervisors, or self-nomination - Sources of information that may indicate a need for training e.g. production records, grievances, safety reports, performance appraisal, absenteeism and turnover, etc. Training Objectives- desired behaviours, conditions, performance criteria Learning Principles- participation, repetition, relevance, transference, feedback Employee Benefits- skills improvement, self-development, self-confidence, sense of growth Organizational Benefits- improved profitability, improved morale, lower costs, better corporate image TRAINING TECHNIQUES On-the-Job Job rotation Apprenticeship Coaching Off-the-Job Lectures and videos Role-playing Case study Simulation exercises Laboratory training Computer-based (CBT) Virtual reality (VR) Internet/ Web-based- Virtual education/ eLearning WEB-BASED DELIVERY SYSTEMS Web/ computer- user interacts with only one program Web/ electronic performance support- workers have access to databases, online tools Web/ virtual/ synchronous- meet at a predetermined time Web/ virtual asynchronous- classroom on the Internet- accessible anytime WEB-BASED TOOLS A variety of methods have been developed: - Blogs are websites with text and graphics RSS delivers regularly changing news Podcasts consist of audio or video clips Wikis are accessible Web pages Social networking websites Intranet training uses an intra-organizational computer network to deliver training Video-conferencing STRATEGIC HRD Strategic HRD- the identification of essential job skills and management of employees’ learning in relation to corporate and business strategies Benchmarking- comparing one’s own standards against those of industry leaders or competitors Employee Development- process of enhancing an employee’s future value through careful career planning DEVELOPMENTAL STRATEGIES Cognitive- altering thoughts and ideas- increasing knowledge and expertise; includes lectures, seminars, academic education Behavioural- change behaviour e.g. management style; includes role-playing, behaviour modeling, etc. Environmental- provide the setting for employees to develop; includes job rotation, OD, learning organization EVALUATION OF TRAINING AND DEVELOPMENT Criteria - Knowledge - Behaviour - Organizational results - Reaction CAREER PLANNING AND DEVELOPMENT Career Planning- process through which someone becomes more aware of their interests, needs and motivations Career Management- series of formal and less formal activities- designed and managed by the organization Career Development- a series of activities undertaken by individuals in pursuit of their careers Factors affecting individual career choice - Generational differences - Individual values, abilities, and attitudes - Personality-Job fit - The RIASEC Model (Realistic, Investigative, Artistic, Social, Enterprising, Conventional) HR Department and Career Planning Encourages management commitment and support Devise communication plans through HR tools Align HR processes to facilitate career planning Use of technology to support career planning efforts Develops promotable employees Lowers turnover Taps employee potential Furthers growth Reduces hoarding Satisfies employee needs Assists organizations meet legal requirements Chapter 8: Performance Management Performance Management- involves much more than just performance appraisal. Individual employees need to meet their performance goals- collectively, helps the organization to meet its goals Uses of Performance Data - Corporate culture - Organizational benchmarks - Human capital potential - Systems and processes - Resources Informs - Current policies - Program directions - Sharing results with stakeholders - Asking for shareholder input Characteristics of Effective Performance Management - Performance objectives - Performance goals - Performance measurement - Output measures - Outcome measures Performance Management System Goals Organizations try to achieve the following: - Transform organizational objectives into clearly understood measureable outcomes - Provide instruments for measuring, managing, and improving the success of the organization - Include measures of quality, cost, speed to provide as in-depth, predictive system - Shift to an ongoing, forward-looking strategic partnership between management and employees Performance Management as part of Managerial Strategy Performance Appraisal- the process by which organizations evaluate employee job performance; provides data to assess every employee Balanced Scorecard- very popular approach; combines the performance measures of the total organization- integrates customer satisfaction, internal processes, learning, and innovation Uses of Performance Appraisal - Feedback and performance improvement - Administrative decisions - Employee development and career planning - Criteria for test validation - Training program objectives - Job redesign Key elements of Performance Appraisal The HR department usually develops performance appraisals for employees in all departments - Centralization is meant to ensure uniformity in order to provide for useful results - Employee’s immediate supervisor usually performs the actual evaluation APPRAISAL SYSTEMS Job-Related- evaluates behaviours that constitute job success Practical- understood by evaluators and employees Have performance standards- benchmarks for measuring performance Have performance measures- ratings used to evaluate performance PERFORMANCE MEASURES Direct- rater actually sees the employee’s performance Indirect- rater has only substitutes for performance (constructs) Objective- verifiable by others; usually quantitative Subjective- not verifiable by others; based on rater’s opinions Characteristics for Effectiveness - Validity - Reliability - Input into development - Acceptable standards - Acceptable goals - Control of standards - Frequency of feedback - Rater training - Ratee training - Input into interview process - Appraisal consequences - Different sources (raters) PAST PERFORMANCE: NONCOMPARATIVE Rating Scale- oldest and most widely used method; subjective i.e. based on the rater’s opinion; responses may be given numerical values BARS- descriptions of effective/ ineffective performance- examples placed alongside a scale; job-related, practical, and standardized Tests and Observations- may include paper-and-pencil tests or an actual demonstration of skills 360 Degree- multiple sources of ratings e.g. self, peer, supervisor, subordinate, customer PAST PERFORMANCE: COMPARATIVE Ranking Method- employees ranked from best to worst; subject to halo and recency effects Forced Distributions- employees sorted into categories; usually a certain proportion must be put into each category FUTURE PERFORMANCE METHODS Management-by-Objectives Approach- employee and supervisor jointly establish performance goals for the future; goals should be mutually agreed upon and objectively measurable Assessment Centre Technique- relies on multiple types of evaluation and multiple raters; usually used for middle-level managers OTHER DEVELOPMENTS Web-based Performance Appraisal- has become the standard for all sizes of firms; ideally performance appraisal software is part of an enterprise-wide software system Competencies- focus more on skills than job performance Talent Management- identifying and developing specific individuals who are seen as having high potential IMPLICATIONS OF APPRAISAL TRAINING Training Raters- raters need knowledge of system and its purpose; focus on cognitive aspect of the rating process Focus on reducing/ eliminating rating errors: Recency Effect- occurs when ratings are strongly affected by the employee’s most recent actions (either good or bad) Contrast Errors- occur when raters compare employees to each other rather than to a standard IMPLICATIONS OF APPRAISAL EVALUATION INTERVIEWS Evaluation interviews are performance review sessions that give employees feedback - Tell-and-sell - Tell-and-listen - Problem-solving The interview should be a positive, performance-improving dialogue EFFECTIVE EVALUATION INTERVIEWS - Emphasize positive aspects of employee performance - Tell each employee the evaluation session is to improve performance not to discipline - Provide immediate positive and developmental feedback in a private location - Review performance formally at least annually - Make criticisms specific, not general and vague - Focus on criticisms on performance, not personality - Stay calm and do not argue - Identify specific actions the employee can take - Emphasize the evaluator’s willingness to assist - End the evaluation session by stressing the positive aspects of performance and reviewing plans to improve performance HRM FEEDBACK The performance management process also provides insight into effectiveness of HRM If poor performance is widespread, many employees are excluded from promotions and transfers Unacceptably high numbers of poor performance may indicate errors in the HRM function- e.g. selection process may be screening candidates poorly; job analysis information may be inaccurate, etc. LEGAL ASPECTS OF PERFORMANCE APPRAISAL A performance appraisal form is a legal document Raters must use only performance criteria that are relevant to the job Avoid non relevant criteria A reasonable time must be set for performance improvement Well-documented performance shortcomings and use of feedback interviews have been viewed favourably in court and with arbitrators Chapter 9: Compensation Management Compensation- cash and non-cash rewards employee receive in exchange fo their work. Effective compensation management- employees more likely to be satisfied, motivated, and contribute to objectives Compensation perceived inappropriate- performance, motivation, and satisfaction may decline dramatically; turnover may occur; dissatisfaction with absolute or relative pay Objectives of Compensation - Retain employees - Ensure equity - Reward behaviour - Control costs - Legal compliance - Administrative efficiency - Acquire personnel Phase 1: Job Analysis Initial job analysis Identify and study jobs - Position descriptions - Job descriptions - Job Standards Phase 2: Job Evaluation Determine relative worth or value of jobs Provides for internal equity Job Evaluation methods - Job ranking - Job grading - Point systems Phase 3: Salary Surveys Discover what other employers are paying for specific key jobs Provides for external equity Sources of data: HRSDC, consultants, employer associations, professional associations Phase 4: Establishing the pay level for each job- combines job evaluation rankings, survey wage rates, and other considerations; wage-trend line developed Creating compensation structure- job classes and rate ranges Challenges Affecting Compensation - Union power Productivity Wage and salary policies Government constraints Prevailing wage rates PAY EQUITY CHRA prohibits discrimination because of sex It is illegal for companies to pay women less than men if their jobs involve equal skills, effort, responsibilities, and conditions Government enforces these provisions Equal pay for equal work (equal pay)- parts of Canada Labour Code since 1971; employers must pay men and women the same wage or salary when they do the same work Equal pay for work of equal value (pay equity)- jobs of comparable worth to the organization should be paid equally; part of CHRA since 1978 Wage Gap- historical gap between the income of men and women; women earn about 80% as much as men Wage gap exists in part due to: - Women tend to work in lower-paying occupations e.g. teaching, retail, nursing - Career gaps- leave workforce to care for children - 5-10% due to gender-based pay discrimination Pay-for-Performance- incentive systems provide the clearest link between pay and performance or productivity Incentive Pay- directly linked to employee’s performance or productivity Benefits - Performance is reinforced regularly - Reinforcement is quick and frequent - Desired behaviours are likely to continue - Wages paid in proportion with performance Problems - Administration can be complex - May result in inequities - Employees may not achieve standards due to uncontrollable forces - Union resistance - Employees may focus on only one aspect INDIVIDUAL VS. TEAM-BASED INCENTIVES Individual - Piecework - Production bonuses Commissions Maturity curves Executive incentives Team-Based - Team results - Production incentives - Profit-sharing plans - Stock ownership (ESOPs) - Cost reduction plans - Non-monetary PAY SECRECY Advantages - Most employees prefer to have their pay kept secret - Gives managers greater freedom - Covers up inequities Disadvantages - May generate distrust in the pay system - Employees may perceive there is no relationship between pay and performance APPROACHES TO PAY Skill- or knowledge-based Pay- based on the employee’s skills or knowledge Variable Pay- performance-linked compensation approach Broadbanding- consolidation of pay grades into a few broad bands Tailor-made perks International pay CHANGING COMPENSATION SYSTEMS Traditional - Pay = 100% base salary - Entitlement-based increases - Few incentive/ bonus plans- restricted to executives Modern - Variable component added - Performance-driven gains - Many kinds of plans, extended throughout organization Areas that impact pay systems - Motivating performance - Identifying valued rewards - Performance-related - Setting goals Consequences Motivating development Attraction and retention