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1. Job Analysis: defines a job in terms of specific tasks and responsibilities and identifies the

CHAPTER 1: STRATEGIC HRM

Explain what is meant by human resource management Employee-Employer relationship Achieving the organisation's strategic objectives

abilities, skills, knowledge and qualifications needed to perform it successfully.

2. HR planning: organisation attempts to ensure that it has the right number of qualified
people in the right jobs at the right time.

3. Recruitment and Selection: process of seeking and attracting a pool of applicants and
predicting who be most likely to perform successfully in a job.

4. Performance Appraisal: is establishing a plan for performance improvement in order to

Satisfaction of individual employee needs determine how well employees are doing their job.

5. Training and development: focus on acquisition of the attitudes, skills and knowledge
Understand the relationship between human resource management and management required for employees to learn how to perform their jobs, improve their performance etc.

6. Career Planning: identifies employee career goals, possible future job opportunities and
personal improvement requirements. Deals directly with people Maximise human capital to improve the productive contribution of people HRM activities are divided between line/operating and HR managers

7. Employee Motivation: highly motivated employees tend to be more productive and have
lower rates of absenteeism, turnover and lateness.

8. Remuneration/Compensation: cash rewards, such as the base pay, bonuses, incentive

payments and allowances, which employees receive for working in an organisation.

9. Benefits: superannuation, life insurance, disability insurance, medical and hospital

Describe the HR managers role 1. Strategic Partner: achievement of organisation 's objectives by translating business strategy into action. 2. Administrative expert: efficiency -> HR managers effective -> management of HR activities 3. Employee Champion: meet needs of employees and employee voice 4. Change Agent: developing problem-solving and influence skills insurance, long-term sickness and accident disability insurance, annual leave, sick leave, maternity leave and tuition refund programs.

10. Industrial or Employee Relations: involves governments, industrial tribunals, employer

associations, trade unions, industrial law, awards, terms and conditions of work, grievance procedures, dispute settlement, advocacy and collective bargaining.

11. Health and Safety programs: help guarantee the physical and mental wellbeing of
employees. Organisations are required to provide a safe work environment free from physical hazards and unhealthy conditions.

12. Managing of diversity: and successfully integrate Australias multicultural population into
the workforce to maximise the contribution of all employees represents a special challenge to HR managers.

Understand the human resource management activities performed in organisations

HRM1O7 NOTES Explain the meaning of strategy

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Schermerhorn, the direction an organisation intends to move and establishes the

framework for action through which it intends to get there

Purpose: to maintain a position of advantage by capitalising on an organisations strengths

and minimising its weaknesses.

Explain the meaning of strategic human resource management according to Thompson and Strickland it Is the process whereby managers establish: An organisation's long-term direction, Set specific performance objectives, Develop strategies to achieve these objectives With influence of both internal and external environmental factors

CHAPTER 9: HUMAN RESOURCE DEVELOPMENT (HRD)

VET: is externally focused, meets skills needs of individuals/ helps employability. Involves nationally recognised quals that may meet the needs of the employing organisation.

and organisational. It includes training and development, career planning and performance appraisal. Its focus is on the acquisition of the required attitudes, skills and knowledge to facilitate the achievement of employee career goals and Aim organisational strategic business objectives. o Involves employee training and development and the exploitation of knowledge. Learning Help the organisation to achieve a competitive advantage, organisations that focus on the acquisition, sharing and utilisation of knowledge give L & D top priority. The special edge (better than its competitors) o HRD role: improved organisational performance and individual growth. o Aim: the training must specifically address the aim, so HRD must be linked to business Ensures long-term success for the organisation. objectives. Need for HRD: is an important activity. HRD is a key source to sustainable competitive advantage. Accelerating rates of change and global competition have meant that HRD has become important organisational and national issues. HRD is now recognised as critical to competitive Describe a strategic approach to human resource management see fig 1.14 p. 27 success. o It is not simply a desirable HRM activity but a powerful contributor to the achievement of This diagnostic model provides the HR manager with an analytical framework to anticipate and the organisations strategic business objectives. prevent problems from arising. o Newly hired employees need to be trained to perform their jobs. o Existing employees need to acquire new skills and knowledge. o HRD powerful tool in: Implementing a new policy; Implementing a strategy; Effecting organisational change; Changing an organisations culture; Meeting a major change in the external environment; Solving particular problems.

HRD: (p.339) developed in US. Far broader concept, embracing individual, career

HRM1O7 NOTES o Due to changes, people and organisations are continually faced with situations that require learning and the exploitation of knowledge. These changes include: Business and economic changes; technological changes; Organisational changes; Social, legal and other changes. Equal Employment Opportunity (EEO) and Training and Development (T&D): organisations must promote equality in T&D in order to gain access to a wide range of talent and enhance organisation flexibility. The EEO issues in training and development include (see p.343):

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Focus: on higher pay rates via restriction of entry and demarcation rather than
promoting learning. Promote: technique designed to promote employee commitment and a unitarist corporate culture. Up-skilling: creates exploitation via increased work intensification and increased employee stress. (now highlighted by the WorkChoices legislation)

Strategic HRD: (p.343)If this aim of HRD fails, the organisations competitive strategy will
not be supported. o Strategic approach to HRD: aims to meet an organisations specific business objectives. o Purpose of HRD: help the organisation and individuals to compete more effectively, now and in the future. o The HR manager should ask:

Where are we going?; What are the strategic business objectives of the organisation?;
What do we need to do to get there?; What needs to be done to build the employee skills and knowledge needed to achieve those objectives? Think about launching a new product-what do you need to make the launch a success? However, this has been criticised for promoting compliance with organisations values particularly when the performance appraisal, recruitment and selection, and reward systems are strategically integrated to reinforce the absorption of desired values. o Reasons for absence of strategic HRD:

Organisations lack or have ill-defined strategic objectives Top management views T&D as a necessary evil, something nice to do or an
employee benefit Organisations neglect long-term considerations and concentrate on short-term Organisations do not analyse T&D needs Evaluation of training is ignored or emphasises employee satisfaction rather than performance improvement. o Trade unions and training: former Coalition governments IR reforms reduced trade union influence and promoted individualisation of the employment relationship. Resulted = less training and fewer provisions for employee training in workplace agreements.

Training and Development (HRM Methods and Techniques): (p.345) To improve performance and avoid employee obsolescence, the employee should undergo further T&D. T&D activities reflect the capacity for people to grow and change. Key parts of HRD include o Development: (FUTURE) involves those activities that prepare an employee for future responsibilities. o Training: (NOW) represents activities that teach employees how to better perform their personal job. It starts when an employee enters the organisation. It has a rather narrow connotation. It focuses on the development of the skills of the workforce. 32% (1/3 of all organisations) of organisations give training to new employees. Carpan report: Australian level of training and education skills was far worse than our
economic training partners than other similar Western countries like China and Europe (world leaders). Australia has to re-think its training and development in organisations to improve living standards. Australia neglects leadership skills Importance of training: Increase knowledge of foreign competitors & cultures. Provides the skills required to work with new technology. Helps employees understand how to work in teams. Ensures that firms culture emphasises innovation, creativity & learning.

HRM1O7 NOTES Ensures employment security by providing new ways for employees to contribute to the company. Prepares employees to work in a diverse workforce. Aim: to provide them with the skills necessary to meet performance standards. To remedy substandard performance. Performance Appraisal: important source of information on training needs which highlights specific Changing technology in T&D: leads to unequal power relationships that enable employers to shape and restrict learning opportunities for employees and existing employees become redundant. Training beyond immediate job requirements: (HR planning = organisation attempts to ensure that it has the right number of qualified people in the right jobs at the right time) to do this organisation must provide T&D to ensure employee skills and knowledge match future HR requirements. If HR planning fails organisations competency and overall competitiveness will decline.

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success of the business. Measures of training effectiveness include (p.360): (these can be measured during or end of training activity) = Reactions; Learning; Behaviour; Results (see p.361 fig 9.8) Identify the programs strengths and weaknesses. Assess if content, organisation and administration contribute to learning & the use of training content on the job. Identify which trainees benefited most or least from the program. Gather data to assist in marketing programs. Determine the financial benefits and costs of the program. Compare the costs and benefits of training versus non-training investments. Compare the costs and benefits of different training programs, so as to choose the best program

Systematic approach: to training and development involves assessing needs,

selecting training methods and evaluating their effectiveness. (p.349) A three step approach to training that involves: Evaluation is the most important a) Assessment of training needs: establish what is needed, by whom, when and where, so that training objectives can be determined or established. Must examine the organisation, the task and the person. That is, what skills, knowledge and behaviours are needed. These include (p.350): Organisational variables determine the quality and quantity of the resources allocated to the training effort. Task variables nominating job tasks is essential for identifying the employee competencies necessary to perform the job. It helps identify job performance standards and knowledge, skills and abilities needed to perform these tasks. Person variables related with how an employee performs their tasks. b) Conduct of the Training Activity: select the training methods and learning principles to be employed in a training program. (see pp.350358) Location on the job versus off the job and in house versus out of house Timing in hours versus out of hours, spaced versus massed learning session length Presenters in house versus externals c) Evaluation of the training activity: measure how well the activity met the T&D objectives. Evaluation is necessary to ensure that training is contributing to the

Orientation/Induction: (p.363) is a key part of T&D process. It is the systematic introduction of new employees to their job, colleagues and the organisation. The need to orient employees and generate a feeling of belonging is critical to avoiding problems of incorrect job instruction, labour turnover and reduced morale. New employees need to learn about the organisation and its culture, to learn how to do their jobs and to be introduced to workmates. o Benefits of employee orientation: can achieve significant cost savings By reducing the anxieties of new employees. By fostering positive attitudes, job satisfaction and a sense of commitment at the start of the employment relationship. o Timing of orientation: Ideally, planned orientation activities should commence as soon as the employee joins the organisation. If not planned, there is a risk that new employees will learn about the organisation and their jobs from someone who may be untrained, ill informed or dissatisfied. Such erroneous information can quickly lead to frustration, poor performance and the development of a negative attitude towards the organisation.

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Orientation can be through a formal or informal program, orientation. To be successful the programs must be well planned. o Orientation program content: content should be clearly laid out and comprehensive in its coverage including history, philosophies, HR policies, products and services and so on and about the job. The content must provide essential information on the employment relationship, build identification with the organisation and establish high performance expectations.

We must alter our thinking to restore equilibrium or balance To do this, we must associate it with what we already know the learner must build cognitive structures through the use of : - Mental maps - Concept maps - Foster Critical thinking

Psychological principles of learning: o Constructivist approach to Learning HOW DO YOU LEARN?: a view based on the belief that knowledge isn't a thing that can simply be given by the instructor to trainees in their desks. rather trainees learn by matching data with what they already know So its the trainees who have the controls and develop the knowledge via their own mental processes. Trainees learn by fitting new information together with what they already know. Learners are the builders and creators of meaning and knowledge. Knowledge is constructed by learners through an active, mental process of development. Piaget (Swiss Psychologist) believed learning occurs by an active construction of meaning, rather than by receiving it passively. He states," when we, as learners, encounter an experience or situation that conflicts with our current way of thinking, a state of imbalance is created

combination of all three areas which is a large cog. Describe the activities associated with the development of people in organisation; Closely related to training, HRD &VET but has its own emphasis and L&D borrows something from all three of the other fields. o Creating a learning environment: employees need to Know why they should learn Use their own experiences (Constructivisim) for learning Learn by observing and interacting with others Trainer should try to accommodate left & right brain learners Have opportunities to practise Receive feedback and undergo a well coordinated and arranged training program o Future of learning:

Learning & Development (L&D): emerged in recent years in Australia

M-learning, mobile learning via mobiles, iPods Serious gaming: software application development with game technology-focuses on
using games

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Sharable Content Object Reference Model (SCORM): is a collection of standards and

specifications for web-based e-learning. It defines communications between client side content and a host system called the run-time environment (commonly a function of a learning management system). SCORM also defines how content may be packaged into a transferable ZIP file. SCORM is a specification of the Advanced Distributed Learning (ADL) Initiative, which comes out of the Office of the United States Secretary of Defense. Collaborative environments: tools for distributed work - projects include Project Wonderland, MPK20, jVoiceBridge, Porta-Person, Conference Manager, and the Sun Labs Meeting Suite. Asynchronous learning: is a teaching method using computer network technology. It is an approach to providing technology-based training that incorporates learner-centric models of instruction. Authoring tools: is a software package which are commonly used to create e-learning modules. Blended learning: combination of multiple approaches to learning. A typical example of this would be a combination of technology-based materials and face-to-face sessions used together to deliver instruction. Learning management systems (LMS): is a set of software tools designed to manage user learning interventions. LMSs go far beyond conventional training records The valueadd for LMSs is the extensive range of complementary functionality they offer. Learner self-service (e.g. self-registration on instructor-led training), training workflow.

4. Identify knowledge, skills or abilities necessary to successfully perform each task.

CHAPTER 10: CAREER PLANNING & DEVELOPMENT Read chapter 10 pp. 384 404 (as it is very similar to chapter 9 and lecture has only covered the notes above)

factors need to be considered before training: 1. Support of managers & peers 2. Company strategy 3. Training resources o Person analysis: identify who needs training. Involves: 1. Who 2. Determining if perfect deficiencies result from a lack of knowledge, skill, ability or motivation 3. Determining readiness for training o Task Analysis: Identifying the tasks & knowledge, skills and behaviours that's needed. 1. Select the job to be analysed. 2. Develop a preliminary list of tasks performed 3. Validate preliminary list of tasks.

Organisation analysis: considering the context in which training will occur. 3

CHAPTER 11: REWARDING HR

reinforce the organisations culture and key values and to facilitate the achievement of its strategic business objectives. Involves remuneration practices being aligned with the achievement of the organisations strategic business objectives. E.g. Pay for performance discussed below. E.g. companies like ANZ, BHP Billiton, Fosters, Macquarie Bank and Westpac have aligned their executive remuneration to shareholder-based measures. o Remuneration: is what employees receive in exchange for their work. Includes pay and benefits (total remuneration) or just pay (cash remuneration).

Strategic Remuneration: (p.418) one of most important HRM activities. It can

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Philosophy: (p.419 see fig 11.2) it must be consistent with its overall strategic
business objectives and policies should emanate from the organisations strategic business objectives because these determine performance and behaviours to be: Motivated The kind of people to be attracted and retained Structure of organisation o Remuneration Policies and Practices: by rewarding desired results, this can reinforce employee behaviour that realises its strategic business objectives. o Remuneration program objectives: (p.420) For the organisation Attract and keep the desired quality and mix of employees Ensure equitable treatment (for both organisation and for the employee) Motivate employees Reinforce organisations key values and desired organisational culture. Control remuneration costs Comply with legal requirements For the employee Accurately measure and reward performance and contribution to achievement of BS objectives. Provide accurate remuneration changes Provide regular remuneration and performance reviews

Jobs can be differentiated by evaluating the information in this. Formats vary from
brief summaries to essay type descriptions or may follow from a rigid format to unstructured. Must be consistent with organisations strategic business objectives and culture. (also see p. 424) 2) Job Ranking: sizes jobs by placing them in rank order. This is the quickest, simplest, most user-friendly and oldest method. Disadvantage: it does not measure the magnitude of difference between jobs. Too subject to bias, too clumsy to be used in any but small businesses. 3) Job grading or classification: sizes jobs using a series of written classifications. 2 steps- 1) use no. of job-related factors 2) create generic or benchmark job descriptions for each grade or class. Disadvantage: at least satisfactory descriptions have to written for each grades or classes. In large businesses it becomes more complex = unworkable. Overcome this problem: use functional (or job family) gradings or classifications. 4) Point system: numerical values are assigned to specific job factors and the sum of those values provides a quantitative assessment of a jobs relative worth. Advantage: more precise, Disadvantage: but quite subjective decisions, time consuming, expensive and difficult. 5) Factor caparison system: (p.423) involves comparing/ranking jobs (independently no. of different times) on range of factors such as know-how, responsibility etc. Each factor ranking for each job is converted to points. The total no. of points for the factors = job size. Disadvantage: it is complex and not easily understood by employees, expensive to introduce and maintain. Hence, larger organisations can only use it. Which System should be used? (p.423) No system is perfect. This depends on Objectives; Size of organisation; Organisational resources Plan users Corporate culture Employee attitudes

Job evaluation: (p.420) the systematic determination of the relative worth of jobs
within an organisation. AIM = ensure jobs of different sizes or relative worth attract the appropriate pay differentials. It forms the basis for establishing the organisations job hierarchy and associated pay structure. Ranks biggest to smallest on a scale. blueprint that profiles the design of the job, making its potential usefulness to management. o Using an inaccurate or incompatible job description can damage organisation by clouding employee roles and organisational objectives. Must be employed in gender-neutral fashion. Effectiveness of job descriptions can be undermined byo Misuse by managers or employers

Job Description: necessary requirement for any job evaluation scheme. It is a

o Systems: (p.421) there are many methods to evaluate jobs these are 1) Job Description: It is a written statement explaining the purpose of a job, what activities are performed, the conditions under which they are accomplished and the performance standards required.

HRM1O7 NOTES o Incompatibility with organisations strategic objectives and culture o Difficulty in comprehension o Inflexibility in design and content o Rapid obsolescence o Excessive costs

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the concept of promotion so pay grade progression to one of undertaking more varied job duties and responsibilities. Organisations favour broad branding because It reflects their flatter structures Facilitates internal transfers and job mobility Emphasis promotion, Pay Surveys: is the vehicle for relating an organisations pay rates to those for Gives employees greater pay potential; and similar jobs in other organisations. Provide raw materials for job pricing. They are key Supports their new organisational structure. board in design of an organisations remuneration program. o Market posture: determine where an organisation seeks to be in pay market- above or Disadvantages: below market average or at market average. 3 typeso Lack of job compatibility 1) Pay above market average: enables organisations to attract, retain and motivate o Inclusion of mainly high-paying (or low-paying) organisations superior employees. o Poor definition of benchmark jobs 2) Pay market average: common market posture. Aim = to compensate employees at o Misinterpretation of the data. equal level to prevailing market rate. Two types of pay surveys 3) Pay below market average: used by bs in financial difficulty to make sufficient 1) Job match approach: matching similar jobs according to their job size using a common employees stay in bs. It may be only option available in short run. job evaluation method. It gives information on base pay and benefits. HR mangers can use o Policy pay line: (p.429 fig 11.10) a graphical representation of the organisations predicted this to calculate the bs competitive position and to plan any corrective action required. pay midpoints. Remuneration specialist uses these data to determine the organisations Advantage: Less expensive to implement, Disadvantage: but much less precise. current competitive position and to develop the bs new policy. 2) Benchmark jobs: jobs that is similar or comparable in content across firms. It must be stable in job content, widely occurring within organisation to be surveyed. o Job evaluation and pay survey: (p.426) job evaluation is concerned with internal equity. The pay survey makes it possible to assign appropriate pay ranges to each job so it ensures external equity is achieved and maintained. o Pay structure: once job sizes have been established, each job level is given a pay range showing the minimum and maximum pay to be paid. This presents all pay ranges over the whole spectrum of job sizes. o Pay line or curve: (p. 427 fig 11.8) graphically depicts the remuneration currently being paid for jobs, related to job size.

paid for a job at a particular job size. (see p.428 fig 11.9) o Broad banding: collapses numerous job grades with narrow pay brands in a pay structure into few broad job grades with wide pay brands. Restructuring and downsizing have changed

Pay Ranges- standard range: sets the minimum and maximum scheduled amounts
Equitable Remuneration: (p.429) o Pay secrecy: occurs where pay is kept confidential between the employer and employee.

HRM1O7 NOTES

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Disadvantage: Lawler (researcher) suggests secrecy over pay can generate mistrust of
remuneration program and reduce employee motivation and inhabit organisations effectiveness. o Pay compression: occurs when workers perceive that the pay differential between their pay and that of employees in jobs above or below them is too small. Disadvantage: it generates dissatisfaction and makes employees reluctant to acquire new skills, competencies or knowledge to strive for promotion. o Senior Executive Pay: (see pp.431 434) o Setting pay rates: Seniority (Unions favour this as the basis for pay increases), pay-forperformance and skill-based pay (management prefers these two = to motivate employees). Seniority: occurs when pay levels and increases are determined by length of time on the job and not performance. Advantage: most effective in keeping employees within organisation, avoid problems of biased managers and provide a quick and easy way of making pay increase and reward the loyal employee. Disadvantage: reduce labour turnover too heavily = employees poor motivation and poor performing. Pay-for performance: see below Merit pay = any pay increase awarded on to an employee bases on their individual performance. Cost of living increases= any pay increases to compensate employees for changes in their cost of living that are frequently linked to annual changes in a CPI. Skill-based pay: (p.437) a system that compensates employees on the basis of jobrelated skills and the knowledge they possess. Acquire new skills or knowledge. Purpose: to motivate employees to gain additional skills, competencies and knowledge = increase employees personal satisfaction and value to organisation. Advantages: 1. gives management greater flexibility in rostering, allocating work and covering for absenteeism and labour turnover, 2. leads to higher performance, 3. Increase motivation 3. Results to better trained workforce. Disadvantages: 1. Increased pay and training costs, 2. Complex Plan- If too many skills are permitted, 3. Resist- Some employees may not have the ability or desire to acquire new skills or knowledge, so may resist.

Pay for performance: a pay system that rewards employees on basis of their performance. Pay will vary with some measure of individual, team, or organizational performance.

o Pay for performance plans signal a movement away from entitlements (Milkovich, 2007) o Pay for performance rewards those members of the team who deserve it (Jack Wilch, former CEO of General Electric) o Purpose for Pay-for-performance:

Attain strategic goals Reinforce organizational norms Motivate performance at individual, group, and organizational levels Recognise differential employee contributions Achieve budget: increase sales decrease cost, increase productivity, increase customers and fit with organisation culture. Its got to make people want to succeed and work harder; Its got to be able to recognise when someone does put in the effort

Incentive Remuneration:(p.438) At risk remuneration: rewards that are payable only when a performance target is

met. (e.g. of incentive remuneration) Base pay: standard pay that an employee receives doing a job. Bonuses: discretionary rewards paid for achieving performance targets. Options: give employees the option to buy shares at a favourable price at future. o Contribution-based pay: (p.442) a pay plan designed to directly linked rewards to the contributions made by an individual employee. Promotes greater use of incentive pay for employees.

cash to the employee (gym membership, life insurance etc) and all non-financial rewards (office with a window) o Flexible benefit plans: these allow employees to select the particular benefits that match their individual needs. Each employee is allocated a sum of money that can be used to purchase specific benefits. o Types of employee benefits: (p.444 fig 11.16)

Employee benefits:(p.443) include financial rewards that are not paid directly in

Mandatory benefits: Annual leave, Public holidays, Sick leave , Superannuation Voluntary benefits: car, car parking, childcare, club membership etc.

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NOTES FROM LECTURE 8 Overview of lecture What is a Pay-for-Performance Plan? Contrasting perspectives (not in notes) see slide 10 The purpose The pay model see lecture slide 7 Theories: motivational/Behavioural Slide 14, 15 Short-term incentives slide 16 Long-term incentives slide 20 Gain Sharing: Employees earn bonuses tied to unit-wide performance as measured by a predetermined, gainsharing formula. Profit Sharing: Team incentives slide 24

Techniques that make up the compensation system. o Compensation Objectives: shape the pay system and serve as a standard for evaluating the pay system. The basic objectives include efficiency, fairness, and compliance with laws and regulations. Efficiency: focuses on (1) improving performance, increasing quality, delighting customers and stockholders and (2) controlling labor costs. Fairness: attempts to ensure fair pay treatment for all employees by recognising employee both employee contributions and employee needs. Compliance: involves conforming to various federal and state compensation laws and regulations. Compensation Strategy: 4 stepso Pay Techniques 1. Include the methods used to operationalize policy decisions and link these policy decisions to the overall compensation objectives. 2. Job analysis and job evaluation are techniques used to establish a pay structure to achieve o Pay System Policies Terms: we must consider internal consistency in the pay system. 3. Pay surveys are one technique used to establish external competitiveness. Internal Alignment: refers to comparisons among jobs or skill levels inside a single 4. Incentive plans or performance based pay increases are techniques to distinguish employee organization. Pay for different jobs in the organization should reflect the relative similarities contributions. and differences in content of work or skills required for the job as well as differences in the o Incentives: relative contribution of the work or skills to the overall organization objectives. Internal consistency: Job analysis, Job evaluation Short-term: Merit pay, Lump-Sum Bonuses and Individual Spot Awards. External Competitiveness: refers to compensation relationships external to the Merit Pay: Expensive, Improving employee and organizational performance and organization: comparison with competitors. Since employees make comparisons with others more individual focus. doing similar jobs or with others possessing similar skills or competencies outside the Lump-Sum Bonuses: Increasingly used substitute for merit pay; Not built into base organization, pay must be sufficient to attract and retain a motivated work force (relates to pay; Viewed as less of an entitlement than merit pay; Less expensive than merit pay fairness objective). over the long. External competitiveness: Pay surveys Individual Spot Awards: Employee Performance/Contributions: refers to the relative emphasis placed on Long-term: Gain Sharing and Profit Sharing. performance. Emphasis placed on employee contributions is a key policy decision since it Gain Sharing: Employees earn bonuses tied to unit-wide performance as measured directly affects employees attitudes and work behaviors. by a predetermined, gainsharing formula. Management Contribution: refers to the policies related to management of the pay system Profit Sharing: Focus on predetermined index of profitability. Employees receive (safeguards). Involves annual bonus or shares in company based upon company-wide performance. Paid in (1) Ensuring the right people get the right pay for achieving objectives in the right cash or Deferred into a retirement plan. But Employees may not feel their jobs way; and directly impact profits (2) Communicating how the pay system works in ethical and fair ways. Team incentives: Employee contributions: Incentive plans, Performance-based pay increases Advantages: Positive impact on performance of about 5-10%/yr; Ease of o Pay model: serves as a framework for examining pay systems. It contains three (3) basic measurement; Cooperation valued; Support of teamwork; Increases participation in building blocks. decision-making. Disadvantages: Line of sight lessened; Increased turnover; Increases Compensation objectives. compensation risk to employees. Policies that form the foundation of the compensation system.

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CHAPTER 14: MANAGING DIVERSITY

Diversity: refers to the variety of differences between people in an organisation. Includes different races, ethnicities, age groups and genders. Diversity Management: a process of managing employees differences and similarities so that individuals can achieve maximum personal growth and can contribute positively to organisational goals. o Diversity as a concept: 3 types of diversities- demographic (gender, age, ethnicity), psychological (values, beliefs and knowledge), organisational (occupation tenure and hierarchal level).
o Australian

HRM planning strategies: when diversity policy and practices are coordinated in a organisation = employee satisfaction > employees are more productive, adaptable and loyal > high employee commitment. (see pp.554-557) Recruitment and Selection approaches, T&D, Performance Management and Career Development. In all these approaches the HR manager must effectively manage workplace diversity. (also see p.555 fig 14.1) good flow chart summarising this heading.
goals and are promoting culturally and linguistically diverse employees. Many stakeholders demand companies to change the way they organise and conduct bs by recognising and responding to diversity. o 3 HRM Roles: HRM diversity management at strategic, managerial and operational level. 1) Strategic Level: HRM influences organisational boards in focusing on promoting diversity. Their roles relate to developing business strategies that support diversity, as well as developing diversity orientated leaders for the future. Effect: HRM establish diversity management by assisting executives in gathering evidence to develop policies to ensure the desired culture is more diversity orientated. 2) Managerial Level: philosophical role by formulating, integrating and implementing HR policies that promote and support workplace diversity. 3) Operational Level: face-to-face contact with individual employees (e.g. counselling). Also careful selection of supervisors and managers who understand the nature of diversity. o Goals of Diversity Management: as a result of anti-discriminatory, EEO and AA. Hence, HRM viewed diversity management as matter of legal compliance. o Legal requirements: AA and EEO.

HRM approaches: (p.557) many Australian bs have included diversity in their

context of workplace diversity: Australia has been culturally and racially diverse for many generations. Since Federation, govt has shifted from its White Australia Policy to policies based on multiculturalism like AA, EEO and the legislations. Affirmative Action (AA): programs that require firms to make special efforts to recruit, hire and promote women Equal Employment Opportunities (EEO): giving people a fair chance to succeed by avoiding discrimination based on unrelated job factors. Human Rights Legislation: (see p.552 table 14.1)
o Impact

Legal obligations: EEO and AA are legal requirements, thus imposing legal
obligations and liabilities on employers. Also legislation imposes specific legal requirements on employers. The HR manager then needs to ensure that the organisations HR policies and practices comply with the relevant legislation. Public Service: legislation to promote EEO and AA at state and Federal levels. All Australian states and territories have anti-discrimination EEO legislation in addition to the Federal legislation. o Productive Diversity: is a utilitarian version of multiculturalism. It supports and encourages businesses to embrace diversity. For HRM key objective is benefit for all so concepts include flexibility, multiplicity, devolution, negotiation and pluralism. o Pros of Diversity Management: (p.561 Table 14.2)

of diversity on HRM: (p.554) modern HRM departments emphasise the role of individual employees through many HRM activities which focus on ensures employee involvement. These tasks require bs to Structure: working environment that promotes challenging work, appropriate pay and conditions and opportunities for on-job T&D. So HRM diversity policies must be integrated with organisational strategies.

Improved organisational performance and Flexibility Costs advantages Lower turnover rates and less absenteeism

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Reputation Creativity and innovation

o Risks and Challenges of not Managing Diversity: (p.562 Table 14.3)

Individual outcomes: discrimination, harassment, lower job satisfaction. Lower

commitment, lower performance and lower salarly. Group outcomes: conflict and communication problems. Organisational outcomes: lower performance, unproductive teams, ineffective systems and procedures, higher turnover, adverse publicity and inability to attract. Bottom-line costs: lower organisational performance, reduced competitiveness, lower profits and reduced benefit from T&D programs.

Diversity-orientated leadership: (p.568) HRM is charged with task of promoting the leadership of diversity to net business rewards beyond those achieved by retaining diverse employees. o Diversity leadership defined: is leadership that values and affirms differences in an organisation and models transformative, eclectic (diverse), inclusive and social justice behaviours.

Levels of Diversity Management: (p.563) o Management of individuals: Stereotyping: categorising people using generalisations. can be negative (e.g. all males lack feelings) or positive (all Africans are good at sports). Prejudice: refers to peoples attitudes towards members of other groups that are based on faulty, incorrect and invalid generalisation. Discrimination: unfair treatment of a person or minority group. 1) Direct: where a irrelevant criterion is used to exclude a person or group from a benefit or opportunity. 2) Indirect: occurs when policies that appear to be neutral practice or decision advantages an individual or group over another. 3) Reverse/structural/systematic: is discrimination against persons who are not designated as members of a minority or disadvantaged class. Where it allows discrimination to become embedded in the system. Harassment: designed to humiliate, offend intimidate or make a person feel unwelcome or inadequate. o Management of groups: (read pp.564-566) Differences that escalate into conflict and overcoming negative group diversity outcomes and o Management at organisational level: HR practitioners have direct contact with employees at operational and managerial levels and use their specific knowledge of people, procedures and policies in the workplace. When the bs has diversity policies, both leaders and workers are required to respond to diversity issues. (read pp.567-568)

Organisational culture and climate: (pp.570-572) Inclusive workplace: (p.572) Cross-cultural diversity: (pp.574-576) Globalisation: (pp.577-578) Future Diversity Management: (pp.579-581)

HRM1O7 NOTES

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CHAPTER 13: EMPLOYEE HEALTH & SAFETY

OHS: concerned with the provision of a safe and healthy work environment OHS programs reflect an organisations strategic concern for employee productivity and quality of work life OHS strategies Obstructionist economic emphasis on cost and organisational self interest strategic focus = profit compulsion for minimum stds is needed social responsibility denied emphasis on minimum requirement only strategic focus = protecting organisation from prosecution emphasis is on doing the minimum ethically to meet community stds strategic focus = protecting image

Defensive economic legal Accommodative economic legal ethical Proactive economic legal ethical proactive

emphasis on taking preventative action voluntarily advances the wellbeing of employees, organisation and society

2900 work related deaths and 650 000 injuries a year in Australia = $34 billion Australian construction sites have the greatest rate of OHS issues based on death and injury rates (account for 20-30%) Major causes of injury include: o Mechanical failure o Chemical/radiation exposure

HRM1O7 NOTES

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o Slips/trips/falls o Heat/ electricity Major health issues include: o Infectious disease o Shiftwork stress related problems o Mental illness Effective OHS management contributes to the bottom line by minimising losses, reducing workers compensation costs and protecting its people Government regulation of OHS Greatest OHS responsibility is with the employer as they have the greatest control of the working environment Most OHS legislation is state based 12 major OHS Acts and 166 amending Lack of commitment to OHS: legislative instruments o Of Australias top 200 companies, 90% do not report any details of Inconsistencies between the states has called for Federal legislation their safety report, 96% dont publish safety objectives and 80% do o New unified system (based heavily on Victorian laws) not report a system that is used to manage risks o Proposed reforms include: o Low OHS fines in Asian countries allow for the exploitation for workers Employers will no longer have to prove that they are not at o Companies transfer their OHS risks and hazards by relocation fault for accidents industrial wastes and noxious industries to other countries (including Unions will not be allowed to prosecute safety breaches in Australia who sends lead-acid batteries to India) court o Australian industries with low OHS stds include: Unions have the right to enter workplaces where there is an Clothing accident Farming Emphasis on changing employer behaviour Fishery Prosecution as a last resort Forestry National Occupational Health and Safety Commission (NOHSC) {now the Australian Safety and Compensation Council (ASCC)} led push to improve Employer attitudes and behaviour that treat OHS as an expense are morally Australias record from the mid 80s. Despite lacking enforcement powers, all bankrupt Australian jurisdictions adopted the Duty of Care principle Organisations with healthy and safe work environments have lower insurance ASCC and benefit costs, reduced downtime, experience less damage to plan and o Lead and coodinate national OHS efforts equipment and gain an improved reputation as an employer of choice o To establish a nationally consistent approach to OHS and workers o Top performing companies have workers comp costs that are <10% compensation in Australia of that for the worst performing companies o Provides policy advice to the Workplace Relations Ministers Council o Work is led by the National OHS Strategy 2002-2012 (aims or 20% Organisations striving to achieve competitive advantage through increased reduction in deaths and 40% reduction in injuries by 2012) employee commitment, motivation and productivity, reduced operating costs o NB: Australia is failing to meet these targets due to self regulation and and enhanced public image must align health and safety objectives with their the tripartite approach strategic business objectives Self-regulation: applies where employers are held responsible for providing a o Through applying TQM principles, Boral and Westfarmers have see a safe and healthy work environment. Emphasis is placed on risk management spill over of these principles to safety and have thus applied these rather than detailed government regulation. improvement techniques to OHS Tripartite approach: An approach to OHS involving the active participation of employers, unions and governments o Subject to harsh criticism and has said to have failed o Reasons include:

HRM1O7 NOTES Confusion over OHS responsibilities OHS not seen as a core business activity Economic incentives to improve OHS have decreased Bureaucratisation of OHS has increased Resistance to change Concerns have been overridden by demands for increased productivity and profits o

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OHS considerations when designing, purchasing, installing, operating and maintaining equipment and materials Evaluation of OHS performance o Auditing enable the HR manager to obtain feedback on the efficiency and effectiveness of the organisations program and to take corrective action if needed o Need measures such as inspections, risk assessments, safety as a KPI for employees

Managing workplace health and safety Many organisations believe that their responsibilities stop after they appoint of safety officer Workplace related injuries and illnesses represent a waste of HR. These losses come straight off the bottom line. These costs need to be minimised so profits can be maximised Benefits include: o Lower turnover o Improved satisfaction and morale o Less absenteeism o Higher productivity o Increased attraction as an employer of choice Managers responsibilities o Motivating employees to be OHS conscious o Providing a safe and healthy work environment o Educating about OHS issues o Training employees in a safe way o Monitoring OHS performance o Ensuring compliance with OHS laws and regulations Elements of success o Link OHS objectives and strategies to the strategic business objectives o Develop a corporate culture that embraces OHS o Ensure senior management are committed o Implement HR systems that instil and motivate superior OHS performance o Ensure there is employee involvement o Ongoing communication, education and support o Design job appropriately o Elimination of hazards

Current OHS issues Terrorism o Industry is a primary target for groups seeking to impose global political and economic change o McDonalds, Starbucks and Qantas have all been targeted o Australian companies have increased security measures o NSW Chamber of Commerce recommends: Provide staff with visible security passes Develop an action plan in case of crisis Ensure staff alert to the presence of unauthorised personnel Establish contact with local police Screen mail Audit all security equipment Check credentials of security staff Sexual harassment o Behaviour involving sexually suggestive remarks, unwanted touching and sexual advances, request for sexual favours or other verbal of physical conduct of a sexual nature that is unwanted and that adversely affects a persons employment and/ or creates a hostile work environment o HR managers need to be more proactive and initiate programs that focus on leadership development, team building and social interaction o DJs case Smoking o Reduced social acceptance, demands by employees and customers are giving rise to smoke free environments

HRM1O7 NOTES o o o Should provide a smoke free environment with support such as Quit programs In China, smoking related deaths account for one million deaths per year as well as lost productivity time. Poses a heavy cost to the organisation, governments and the employee In Asia (except for HK, Thailand and Singapore) tobacco controls are weak o

Page 16 of 22 In the US, homicides committed by disgruntled current and former employees are increasingly common

Substance abuse o Employees are turning to alcohol because of work related stress o 17% in the workforce use an illicit drug with the public sector being the highest at 25% o Long term effects of binge drinking include; cancer of the mouth and throat, liver disease, depression and memory loss which decreases productivity of employees o To deal with it effectively, organisation must clearly outline the rights and responsibilities of the employer and employee. If drug testing is a policy, criticism from trade unions will follow Obesity o Organisations are implementing slim down campaigns including Ford and Pepsi co. o Increases the risk of diabetes, heart attacks, cancer, hypertension, stroke etc o In Asia, more than half the population does no exercise o Discrimination against overweight employees is said to be higher than for any other characteristic Workplace violence o Workplaces most at risk include: Health/ welfare/ community services Restaurants Education Retail Road and rail transport o Australian banks have been criticised for their lack of protection for employees ANZ was sued under the OHS Act after it ignored union advice about inadequate security Since the Finance sector union began prosecuting banks, armed robberies have decreased by 80%

Domestic violence o Considered a family and private matter however, implications are seen in workplaces o In Australia, one in four women are subject o Affects psychological wellbeing, productivity, attendance, physical safety, turnover rates etc o HR managers need to find ways to address the psychological aspects and protect employees Workplace bullying o Health and safety hazard o 62% of Australians admit being bullied in the workplace o majority of bullies are managers o higher in workplaces with autocratic and arbitrary management o estimated at costing $6-13 billion a year work-family conflict o the conflicting demands mad eon an individual by home and work o affects productivity o often higher for female employees with issues regarding their children o number one reason professional women in the US quit working o better work-life balance = career advancement o introduction of childcare centres, flexible work arrangements etc. exist o Westpac strongly promotes this balance

Employee stress A condition of strain that affects ones emotions, thought processes and physical condition Without stress, energy and motivation would be absent Stress related illness is said to account for 75% of all health problems Stress depends on whether the employee perceives the stressor as a threat or a challenge Causes o Work factors change, work load, shift work, physical environment, role ambiguity Most affected are women, singles, those living alone, early 20s

HRM1O7 NOTES One third of Australians are concerned with loosing their job and feel they have lost control of their economic future Australian university staff face high loads of stress due to under funding, large workloads, lack of recognition, poor management and job insecurity In Britain, is the largest cause of absenteeism o o o o o o o

Page 17 of 22 Awareness of stress is important and the level which stimulates productivity without damaging health is important Relaxation listening to music, yoga, pets Exercise Diet depleted vitamin supply from stress needs to be replenished, decrease in stimulants, those who over eat are 30% less productive Talk emotional release from frustrations Planning and time management review goals, make priorities Delegation essential for time management and stress control

Personal factors needs Type A personalities 6x more likely to have heart disease yet willingly seek out more stressful jobs o External factors crime, economic conditions, laws and regulations Those who travel for longer and further have increased stress Sydney is the most stressful city in Australia Australia has the highest rate of teen suicides high aspirations created by media, lack of confidence in the future and family disruptions Personal and family affairs also trigger high levels of stress especially for women Stress and job performance o Can help or hinder job performance o As stress increases, performance tends to improve as the employees calls up physical and mental resources to meet the challenges of the job > sense of achievement and satisfaction o If the stress exceeds the optimal level and places excessive demands on the employee, the result will be lower performance Decision making and stress o Inability to make decisions is a symptom of stress o Procrastination is the outcome Symptoms of stress - the more symptoms = higher level of stress o Washed out feeling o Feeling nervous o Tense o Indigestion o High blood pressure o Insomnia o Restlessness o Inability to concentrate and relax o Increase in drug use/ smoking o Change in eating habits o Aches and pains o Sexual difficulties Management of stress

CHAPTER 15: INTERNATIONAL HRM

Major differeces between domestic and international HRM o Additional activities such as taxation, international relocation, expatriate remuneration (someone who lives and works in a foreign country), cross cultural training and repatriation o Increased complexities such as currency fluctuations, foreign HR policies and practices, differing labor laws o Increased involvement with employees personal life (ie. Finding housing, schools, spouse employment) o More complex employee mix due to language and cultural differences o Increased risks personal security, illness, terrorism HR managers must instil a global orientation among employees to be successful

HRM1O7 NOTES International HRM policy Key questions when designing a policy: o What type of organisation is desired? o What are the key values? o What makes the organisation successful? o What is the purpose? o What type of corporate culture is desired? Orientation to International Operations International operations Personnel All mgmt held by home country personnel Centralised, home country, hed office From home country

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Multinational operations Localisation of some positions top held by those in home country Some decentralisation to a regional hed office, head office in home country Regional are main source of instruction, home country head office takes part Home country for expatriates, localised policies for foreign employees in each region Mix Relates the multi domestic approach

Global organisation All positions open to the best people Decentralised, head offices in each country Two way communication between head office and overseas operations Benchmarked on best international practice

Decision making

Communication

HR policies and practices

Mainly home country

Corporate culture Corporate strategy

Home country Relates to global approach

International Relates to a transnational approach

Certain aspects of policies such as benefits, titles etc need to be assessed to determine whether they are appropriate to be implemented in some countries Global view

HRM1O7 NOTES The task of transforming domestic managers into international managers is a strategic HRM problem facing many multinationals o Due to lack of understanding of the essential differences in managing HR in foreign environments o Reluctance of Japanese companies going global to hire local managers meant they are less profitable than European and US companies who understand that having local managers is crucial to the expansion of the organisation Technology implications o Must use a common system in all locations or set up a unique system in each location o Push towards service centres with self service technology to eliminate routine work o

Page 19 of 22 Indonesias corrupt government is harmful to business Companies should: Develop a set of core values as the basis of global policies and decision making Train employees to ask questions that will help them make business decisions that are both culturally sensitive and flexible within the context of the core values Balance the need for policy with the need for flexibility or imagination Trust o Necessary for quick and coordinated global action, the development of employee commitment and social harmony o Important for maintaining business relationships and negotiations o Management style o Effective managers do not use one style of leadership but adjust their style to each situation o In high power distance cultures (China, India, Korea etc) will expect their managers to tell them what to do and the managers will expect their instructions are implemented immediately o Australian managers say that people from these cultures lack initiative however, this is the way they know from experience and education o Asian managers emphasis the importance of hierarchy in interpersonal relationships EEO o Equal opportunity laws are the product of societys social values Performance appraisal o In Korea they are based on performance and on the employees disposition o In Thailand it is based on the employees attitude towards to company , not their performance o Should include performance but also personal variables ie. Communication, flexibility o Criteria must be valid ie. By the government, no corruption Training and development o Issue of what language to hold programs in o Must be sensitive to local customs and expectations

Key cross-cultural issues Communications o Cross-cultural communications: occur when a person from one culture communicates with a person from another culture Gestures, facial expressions, behaviour and words have different meanings across different cultures o High context cultures: cultures where non-verbal communications and indirect language are used to transfer meaning eg. China and Japan o Low context cultures: cultures where verbal communications are explicit and direct eg. USA and Australia o Silence in Asian countries is normal during negotiations where as in Western countries can be seen as threatening o Freedom of expression Western countries are more open o Direct confrontation In Asian counties is seen as rude o Appearance Asian countries are more conservative than Western countries Ethics o Deals with what is good and bad or right and wrong, or with moral duty and obligation. Ethical behaviour may require higher standards than that established by law o Japan: gangsters are hired to break up demonstrators, protect business people and intimidate others to prevent the truth being known o Corruption: includes fraud, bribery, graft and the payment of secret commissions and kickbacks

HRM1O7 NOTES o Remuneration o If they value hierarchy and status will benefit from remuneration strategies that promote and reinforce differences in status o Group orientated cultures will benefit from group rewards o US company Lincoln Electric believe that all employees would be willing to work harder to increase their income Industrial relations o Craft unions: unions that include workers who have a common skill (Australia, UK) o Enterprise Unions: Unions that restrict membership to employees of a particular company (Japan) o Australia seen as them and us and is often dealt with in a legal framework o Japan and US dealt with through cooperation o HR managers must be educated in international industrial relations and understand that each system is quite unique o o o o o o o

Page 20 of 22 Complicated labor laws Termination of surplus staff is difficult Chinese managers have not been subject to perform or operate efficiently Everything is negotiable Politics impacts on all HRM activities The change to a market economy has fostered corruption and deception Personal files Started when 12 yrs Released when go to a new job Contains education, rewards, punishment, personal history, evaluations, political background etc Performance appraisals Correct political attitudes, loyalty to the boss and seniority have traditionally been the main criteria determining performance ratings Objective measures are slowly being introduced Development orientated appraisals have been proven effective Recruitment and selection Bureaucratic and rigid Reliance on interview processes Personal connections and networking is very common Remuneration and benefits Very different between organisations, industries and location Training and development Opportunity to learn a new skill is a powerful motivator for Chinese employees Improves commitment and being seen as an employer of choice Lack of skilled workers = barrier to modernisation and the introduction of new technology and industrial reform > complaint by foreign companies

HRM in China Labor market o Poorly qualified personnel o Shortage of top-class professionals in accounting, HRM and marketing o Shortages in coastal cities o Achieving employee commitment is a HR strategy of firms in China State-owned enterprises o Guarantee of life long employment o Performance appraisals have been subjective and include self assessment and peer assessment o Remuneration have 3 components: Monetary wage Social wage (insurance, medical costs) Non-material incentives (encouragement, titles) o Employees are attracted to foreign firms because of improved pay and better working conditions, more opportunity for development, chance to live and work over seas HR challenges for foreign enterprises o Absence of reliable market data o Expenditure on training and development is often wasted

o o

HRM1O7 NOTES

Page 21 of 22 under threat of innovative and flexible Western HR policies and practices

HRM in Japan o Life long employment Guaranteed a job for their working life Practised by medium-large firms Strong sense of job security = favour highly mechanised processes HRM emphasis is on maintaining harmonious relations with the organisation Will only cut the workforce when the future of a company is seriously threatened Senority-based wage and promotion system System of merit by years Understood to be the true and fair way Necessary to maintain status Enterprise unions Being in an organised group within the company so that its voice is heard different to Western unions Good communication channel Restricted membership to fulltime employees hired from school or university Pay for performance Creates insecurity and uncertainty Spring offensive once a year when pay will increase allowance system is enjoyed monthly often though housing, meals, communication paid promotion based on ability senority receives recognition over Western way of ability duty to be promoted superior performers often do not accept promotions if they believe it will upset the established order fundamental differences jobs evaluated by methods that do not take into account the employees personal situation not a sole focus on profitability interests of minorities are second to group interests future validity of processes Managing International Assignments international recruitment o most positions are filled by local nationals: citizens of the host country of which the business is located. Reasons: cheaper restrictions on the hiring of home country personnel in the host location more familiar with local business environment o expatriates used when: new venture in a foreign location local personnel dont have the right experience/ knowledge culture/ legal and business framework differs dramatically expatriate selection o experience: culture shock, home sickness, differences in health care/ schooling/ housing/ language o must be able to adapt o culture shock inability to adjust to a new cultural environment proper orientation can alleviate expatriate career planning and repatriation o repatriation: return to home country after the completion of an overseas assignment o corporate isolation is a major problem due to lack of feedback and planning overseas o must take control of their own careers o particularly vulnerable if while overseas the company has undergone a merger during their absence o important for turnover and satisfaction performance appraisal o often badly handled o ensure they have key issues clarified and receive feedback whilst away remuneration o increasing incentives due to danger

HRM1O7 NOTES o US executives are reluctant to go to countries such as Indonesia, Iraq, Singapore

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CHAPTER 16: ASSESSING HRM EFFECTIVENESS

Read pp.630 649 aa o ss A: a) s s