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Chapter 6Chapter 6Chapter 6Chapter 6

Human ResourceHuman Resource

PracticesPractices

Toyota GeorgetownToyota Georgetown

““We’ve got nothing, technology-wise, We’ve got nothing, technology-wise, that anyone else can’t have. There’s that anyone else can’t have. There’s no secret Toyota Quality Machine out no secret Toyota Quality Machine out there. The quality machine is the there. The quality machine is the workforce -- the team members on the workforce -- the team members on the paint line, the suppliers, the engineers paint line, the suppliers, the engineers -- everybody who has a hand in -- everybody who has a hand in production here takes the attitude that production here takes the attitude that we’re making world-class vehicles.”we’re making world-class vehicles.”

Key IdeaKey IdeaIntroductionIntroduction

Businesses are learning that to satisfy customers, they must first satisfy employees.

Impact of Fredrick Taylor & Scientific Management

Objectives of HRMObjectives of HRM

To build a high-performance workplace and maintain an environment for quality excellence to enable employees and the organization to achieve strategic objectives and adapt to change.

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Key Activities in HRMKey Activities in HRM

Determine organization’s HR needs to Determine organization’s HR needs to build a high-performance workplacebuild a high-performance workplace

Assist in design of work systemsAssist in design of work systems Recruit, select, train & develop, counsel, Recruit, select, train & develop, counsel,

motivate, and reward employeesmotivate, and reward employees Act as liaison with unions & governmentAct as liaison with unions & government Handle other matters of employeeHandle other matters of employee

well-beingwell-being

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Leading Practices Leading Practices (1 of 2)(1 of 2)

Design work and jobs to Design work and jobs to promote promote cooperationcooperation, initiative, empowerment, , initiative, empowerment, innovation, and organizational culture innovation, and organizational culture

Promote Promote teamworkteamwork and skill sharing and skill sharing across work units and locationsacross work units and locations

EmpowerEmpower individuals and teams to individuals and teams to make decisions that affect quality and make decisions that affect quality and customer satisfactioncustomer satisfaction

Develop effective Develop effective performance performance managementmanagement systems, compensation, systems, compensation, and reward and recognition approachesand reward and recognition approaches

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Leading Practices Leading Practices (2 of 2)(2 of 2)

Effective processes for Effective processes for hiring and career hiring and career progressionprogression

Make extensive investments in Make extensive investments in training and training and educationeducation

MotivateMotivate employees to develop and use their employees to develop and use their full potentialfull potential

Maintain a work environment conducive to the Maintain a work environment conducive to the well-being and well-being and growth of all employeesgrowth of all employees

Monitor extent and Monitor extent and effectiveness of HReffectiveness of HR practices and measure employee satisfactionpractices and measure employee satisfaction

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TeamsTeams

TeamTeam - a small number of people with - a small number of people with complementary skills who are committed complementary skills who are committed to a common purpose, set of to a common purpose, set of performance goals, and approach for performance goals, and approach for which they hold themselves mutually which they hold themselves mutually accountableaccountable

TeamsTeams

Cooperation vs. competition Cooperation vs. competition among employeesamong employees

Teams represent a fundamental Teams represent a fundamental shift in how work is doneshift in how work is done

Teams lead to higher employee Teams lead to higher employee satisfaction and improvement in satisfaction and improvement in qualityquality

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Types of TeamsTypes of Teams

Management teamsManagement teams Natural work teamsNatural work teams Self managed teamsSelf managed teams Virtual teams Virtual teams Quality circlesQuality circles Problem solving teamsProblem solving teams Project teamsProject teams

Key IdeaKey IdeaTeamsTeams

The three basic functions of quality circles and problem-solving teams are to identify, analyze, and solve quality and productivity problems.

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Functions of TeamsFunctions of Teams

Implement solutions

Identifyproblems Select

problem

Collect data

Focus attention

Find causesDevelop

solutions

Pick best solution

Developfollow-up plan

Solve

Identify

Analyze

Key IdeaKey IdeaBuilding Effective TeamsBuilding Effective Teams

The key stages of a team’s life cycle are called forming, storming, norming, performing, and adjourning.

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Ingredients for Ingredients for Successful Teams Successful Teams (1 of 2 )(1 of 2 )

Clarity in team goalsClarity in team goals Improvement planImprovement plan Clearly defined rolesClearly defined roles Clear communicationClear communication Beneficial team behaviorsBeneficial team behaviors

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Ingredients for Ingredients for Successful Teams Successful Teams (2 of 2)(2 of 2)

Well-defined decision Well-defined decision proceduresprocedures

Balanced participationBalanced participation Established ground rulesEstablished ground rules Awareness of group processAwareness of group process Use of scientific approachUse of scientific approach

Six Sigma Project TeamsSix Sigma Project Teams

ChampionsChampions – senior managers who – senior managers who promote Six Sigmapromote Six Sigma

Master Black BeltsMaster Black Belts – highly trained experts – highly trained experts responsible for strategy, training, responsible for strategy, training, mentoring, deployment, and results.mentoring, deployment, and results.

Black BeltsBlack Belts – Experts who perform technical – Experts who perform technical analyses analyses

Green BeltsGreen Belts – functional employees trained – functional employees trained in introductory Six Sigma toolsin introductory Six Sigma tools

Team MembersTeam Members – Employees who support – Employees who support specific projectsspecific projects

High Performance Work High Performance Work SystemsSystems

Work and Job Design

Employee Involvement

Suggestion systems

Empowerment

Training and Education Teamwork and

Cooperation

Compensation and recognition

Health and safety

Flexibility

Innovation

Knowledge and skill sharing

Organizational alignment

Customer focus

Rapid response

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Designing High Designing High Performance Performance Work SystemsWork Systems

Work designWork design - how employees are - how employees are organized in formal and informal organized in formal and informal units (departments, teams, etc.)units (departments, teams, etc.)

Job designJob design - responsibilities and - responsibilities and tasks assigned to individualstasks assigned to individuals

Key IdeaKey IdeaWork and Job DesignWork and Job Design

The design of work should provide individuals with both the intrinsic and extrinsic motivation to achieve quality and operational performance objectives.

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Hackman/Oldham ModelHackman/Oldham Model

Core jobcharacteristics

Criticalpsychological states

Outcomes

Skill varietyTask identityTask significance

Experiencedmeaningfulness of work

Autonomy

Feedbackfrom job

Experiencedresponsibility

Knowledge of actual results

High motivation

High satisfaction

High workeffectiveness

Moderators

Enhancing Work DesignEnhancing Work Design

Job enlargementJob enlargement – expanding – expanding workers’ jobsworkers’ jobs

Job rotationJob rotation – having workers – having workers learn several tasks and rotate learn several tasks and rotate among them among them

Job enrichmentJob enrichment – granting more – granting more authority, responsibility, and authority, responsibility, and autonomyautonomy

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Employee InvolvementEmployee Involvement

Employee InvolvementEmployee Involvement - - any activity any activity by which employees participate in by which employees participate in work-related decisions and work-related decisions and improvement activities, with the improvement activities, with the objectives of tapping the creative objectives of tapping the creative energies of all employees and energies of all employees and improving their motivationimproving their motivation

Key IdeaKey IdeaEmployee InvolvementEmployee Involvement

EI approaches can range from simple sharing of information or providing input on work-related issues and making suggestions to self-directed responsibilities such as setting goals,making business decisions, and solving problems, often in cross-functional teams.

Advantages of EIAdvantages of EI

Replaces Replaces adversarial adversarial mentality with trust mentality with trust and cooperationand cooperation

Develops skills and Develops skills and leadership abilitiesleadership abilities

Increases morale Increases morale and commitmentand commitment

Fosters creativity Fosters creativity and innovationand innovation

Helps people Helps people understand quality understand quality principles and principles and instilling them into instilling them into the organization’s the organization’s cultureculture

Allows employees Allows employees to solve problems to solve problems at the sourceat the source

Improves quality Improves quality and productivityand productivity

Suggestion SystemSuggestion System

Toyota exampleToyota example

Employees generate nearly 3 Employees generate nearly 3 million ideas each year, of which million ideas each year, of which 85 percent are implemented by 85 percent are implemented by management.management.

EmpowermentEmpowerment

Giving people authority to make Giving people authority to make decisions based on what they feel decisions based on what they feel is right, to have control over their is right, to have control over their work, to take risks and learn from work, to take risks and learn from mistakes, and to promote mistakes, and to promote change.change.

“A sincere belief and trust in people.”

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Successful Successful EmpowermentEmpowerment

Provide education, resources, and Provide education, resources, and encouragementencouragement

Remove restrictive policies/proceduresRemove restrictive policies/procedures Foster an atmosphere of trustFoster an atmosphere of trust Share information freelyShare information freely Make work valuableMake work valuable Train managers in “hands-off” leadershipTrain managers in “hands-off” leadership Train employees in allowed latitudeTrain employees in allowed latitude

EmpowermentEmpowerment

Leaders and managers must Leaders and managers must relinquish some of the power and relinquish some of the power and authority.authority.

Management fear and resistanceManagement fear and resistance Advantages of EIAdvantages of EI It is not for everyoneIt is not for everyone

Key IdeaKey IdeaRecruitmentRecruitment

Meeting and exceeding customer expectations begins with hiring the right people whose skills and attitudes will support and enhance the organization’s objectives.

Training and EducationTraining and Education

Quality awarenessQuality awareness Leadership Leadership Project Project

managementmanagement Communications Communications Teamwork Teamwork Problem solvingProblem solving Interpreting and Interpreting and

using datausing data

Meeting customer Meeting customer requirementsrequirements

Process analysisProcess analysis Process Process

simplificationsimplification Waste reductionWaste reduction Cycle time Cycle time

reductionreduction Error proofingError proofing

Key IdeaKey IdeaTraining and EducationTraining and Education

Customer needs and strategic directions should drive training strategies.

It is an essential requirement.

It is one of the largest initial cost in a TQ initiative.

CompensationCompensation

The objective of a good The objective of a good compensation system should be compensation system should be attract, retain and not demotivate attract, retain and not demotivate employees.employees.

Always a sticky issue.Always a sticky issue.

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Compensation and Compensation and RecognitionRecognition

CompensationCompensation– Merit versus capability/performance Merit versus capability/performance

based plansbased plans– GainsharingGainsharing

RecognitionRecognition– Monetary or non-monetaryMonetary or non-monetary– Formal or informalFormal or informal– Individual or groupIndividual or group

Key IdeaKey IdeaRecognitionRecognition

Recognition provides a visible means of promoting quality efforts and telling employees that the organization values their efforts, which stimulates their motivation to improve.

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Effective Recognition and Effective Recognition and Reward StrategiesReward Strategies

Give both individual and team awardsGive both individual and team awards Involve everyoneInvolve everyone Tie rewards to qualityTie rewards to quality Allow peers and customers to Allow peers and customers to

nominate and recognize superior nominate and recognize superior performanceperformance

Publicize extensivelyPublicize extensively Make recognition funMake recognition fun

MotivationMotivation

MotivationMotivation - an individual’s - an individual’s response to a felt needresponse to a felt need

TheoriesTheories– Content TheoriesContent Theories (Maslow; MacGregor; (Maslow; MacGregor;

Herzberg)Herzberg)– Process TheoriesProcess Theories (Vroom; Porter & (Vroom; Porter &

Lawler) Lawler) – Environmentally-based TheoriesEnvironmentally-based Theories

(Skinner; Adams; Bandura, Snyder, & (Skinner; Adams; Bandura, Snyder, & Williams)Williams)

Key IdeaKey IdeaMotivationMotivation

There is no such thing as an unmotivated employee, but the system within which people work can either seriously impede motivation or enhance it.

Performance AppraisalPerformance Appraisal

How you are measured is how you How you are measured is how you perform!perform!

Conventional appraisal systemsConventional appraisal systems– Focus on short-term results and individual Focus on short-term results and individual

behavior; fail to deal with uncontrollable behavior; fail to deal with uncontrollable factors factors

New approachesNew approaches– Focus on company goals such as quality and Focus on company goals such as quality and

behaviors like teamworkbehaviors like teamwork– 360-degree feedback; mastery descriptions360-degree feedback; mastery descriptions

Key IdeaKey IdeaPerformance AppraisalPerformance Appraisal

Performance appraisals are most effective when they are based on the objectives that support the strategic directions of the organization, best practices, and continuous improvement.

Measuring Employee Measuring Employee Satisfaction and Satisfaction and EffectivenessEffectiveness SatisfactionSatisfaction

– Quality of worklife, teamwork, Quality of worklife, teamwork, communications, training, leadership, communications, training, leadership, compensation, benefits, internal compensation, benefits, internal suppliers and customers suppliers and customers

EffectivenessEffectiveness– Team and individual behaviors; cost, Team and individual behaviors; cost,

quality, and productivity quality, and productivity improvements; employee turnover; improvements; employee turnover; suggestions; training effectivenesssuggestions; training effectiveness

Key IdeaKey IdeaMeasuring employee …Measuring employee …

HR measures allow companies to predict customer satisfaction, identify those issues that have the greatest impact on business performance, and allocate appropriate resources.

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Human Resources in the Human Resources in the Baldrige Award CriteriaBaldrige Award Criteria

The Human Resource Focus Category examines how an organization’s work systems and employee learning and motivation enable employees to develop and utilize their full potential in alignment with the organization ’s overall objectives and action plans, and how the organization builds and maintains a work environment and an employee support climate conducive to performance excellence and to personal and organizational growth.

5.1 Work Systems5.1 Work Systemsa. Organization and Management of Worka. Organization and Management of Workb. Employee Performance Management Systemb. Employee Performance Management Systemc. Hiring and Career Progressionc. Hiring and Career Progression

5.2 Employee Learning and Motivation5.2 Employee Learning and Motivationa. Employee Education, Training, and Developmenta. Employee Education, Training, and Developmentb. Motivation and Career Developmentb. Motivation and Career Development

5.3 Employee Well-Being and Satisfaction5.3 Employee Well-Being and Satisfactiona. Work Environmenta. Work Environmentb. Employee Support and Satisfactionb. Employee Support and Satisfaction